46290 Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Notices 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 60375 

(July 23, 2009), 74 FR 38071. 

4See, e.g., CBOE Rule 52.11, Facilitation of 

Orders and Crossing Trades. 

5No CBSX DPMs are stationing personnel at the 

Floor Post at this time. 

6 In approving this proposed rule change, the 

Commission has considered the proposed rule’s 

impact on efficiency, competition, and capital 

formation. See 15 U.S.C. 78c(f). 

7 15 U.S.C. 78f(b)(5). 

8 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3SPY options are based on the SPDR exchangetraded fund (‘‘ETF’’), which is designed to track the 

performance of the S&P 500 Index. 

4An SQT is an Exchange Registered Options 

Trader (‘‘ROT’’) who has received permission from 

the Exchange to generate and submit option 

quotations electronically through an electronic 

interface with AUTOM via an Exchange approved 

proprietary electronic quoting device in eligible 

options to which such SQT is assigned. See 

Exchange Rule 1014(b)(ii)(A). 

5An RSQT is an ROT that is a member or member 

organization with no physical trading floor 

presence who has received permission from the 

Exchange to generate and submit option quotations 

electronically through AUTOM in eligible options 

to which such RSQT has been assigned. An RSQT 

may only submit such quotations electronically 

from off the floor of the Exchange. See Exchange 

Rule 1014(b)(ii)(B). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60589; File No. SR–CBOE– 

2009–047] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Order Approving a 

Proposed Rule Change To Permit All 

CBSX Market-Makers To Operate From 

the CBSX Floor Post 

August 31, 2009. 

On July 2, 2009, the Chicago Board 

Options Exchange, Incorporated 

(‘‘Exchange’’ or ‘‘CBOE’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’), pursuant to Section 

19(b)(1) of the Securities Exchange Act 

of 1934 (‘‘Act’’) 1 and Rule 19b–4 

thereunder,2 a proposed rule change to 

allow all CBSX Market-Maker types to 

operate from the Floor Post. The 

exchange filed Amendment No. 1 to the 

proposed rule change on July 23, 2009. 

The proposed rule change, as amended, 

was published for comment in the 

Federal Register on July 30, 2009.3 The 

Commission received no comment 

letters on the proposed rule change. 

This order approves the proposed rule 

change. 

CBSX is an all-electronic stock 

marketplace operated by the Exchange. 

The CBSX Floor Post is a location on the 

CBOE trading floor where marketmakers can be stationed to respond to 

stock price discovery requests from 

CBOE’s trading floor community. The 

Floor Post is a location for price 

discovery only; since CBSX is an 

electronic exchange, there is no openoutcry trading permitted, and any trades 

agreed to at the Floor Post must be 

entered into the CBSX system in 

accordance with the applicable rules.4

Currently, only members who serve as 

Designated Primary Market-Makers 

(‘‘DPMs’’) on CBSX may operate from 

the CBSX Floor Post.5 The Exchange 

now proposes to permit all CBSX 

Market-Makers types to operate from the 

Floor Post. The Floor Post will continue 

to restrict any sightlines to the equity 

options trading posts. 

After careful review, the Commission 

finds that the proposal is consistent 

with the Act and the rules and 

regulations thereunder applicable to a 

national securities exchange.6 In 

particular, the Commission believes that 

the proposal is consistent with the 

requirements of Section 6(b)(5) of the 

Act 7—which requires, among other 

things, that the rules of a national 

securities exchange be designed to 

promote just and equitable principles of 

trade, to prevent fraudulent and 

manipulative acts, to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system and, in 

general, to protect investors and the 

public interest—because it will promote 

additional price discovery at the CBSX 

Floor Post. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act, that the 

proposed rule change (SR–CBOE–2009– 

047) be, and it hereby is, approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.8

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–21583 Filed 9–4–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60587; File No. SR–Phlx– 

2009–73] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NASDAQ 

OMX PHLX, Inc. Relating to Standard 

and Poor’s Depository Receipts/ 

SPDRs (‘‘SPY’’) Equity Options 

August 28, 2009. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’)1, and Rule 19b–4 thereunder,2

notice is hereby given that on August 

20, 2009, NASDAQ OMX PHLX, Inc. 

(‘‘Phlx’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I, II, 

and III, below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to assess a 

$.05 per contract fee for Standard and 

Poor’s Depositary Receipts/SPDRs 

(‘‘SPY’’)3 equity options that are 

directed to specialists, Streaming Quote 

Traders (‘‘SQTs’’)4 and Remote 

Streaming Quote Traders (‘‘RSQTs’’)5 by 

a member or member organization and 

are executed electronically in lieu of the 

existing specialist and Registered 

Options Trader (on-floor) equity options 

transaction fees. 

While changes to the Exchange’s fee 

schedule pursuant to this proposal are 

effective upon filing, the Exchange has 

designated this proposal to be effective 

for trades settling on or after August 25, 

2009. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http:// 

nasdaqomxphlx.cchwallstreet.com/ 

NASDAQOMXPHLX/Filings/, at the 

principal office of the Exchange, and at 

the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

forth in sections A, B, and C below, of 

the most significant aspects of such 

statements. 


jlentini on DSKJ8SOYB1PROD with NOTICES
Federal Register / Vol. 74, No. 172 / Tuesday, September 8, 2009 / Notices 46291 

6See Exchange Rule 1080(l), ‘‘...The term 

‘Directed Specialist, RSQT, or SQT’ means a 

specialist, RSQT, or SQT that receives a Directed 

Order.’’ A Directed Participant has a higher quoting 

requirement as compared with a specialist, SQT or 

RSQT who is not acting as a Directed Participant. 

See Exchange Rule 1014. 

7See Exchange Rule 1080(l). ‘‘...The term ‘‘Order 

Flow Provider’’ (‘‘OFP’’) means any member or 

member organization that submits, as agent, 

customer orders to the Exchange.’’ 

8 15 U.S.C. 78f(b). 

9 15 U.S.C. 78f(b)(4). 

10 15 U.S.C. 78s(b)(3)(A)(ii). 

11 17 CFR 240.19b–4(f)(2). 12 17 CFR 200.30–3(a)(12). 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to create incentives for 

specialists, SQTs and RSQTs that 

receive directed order flow to provide 

liquidity in SPY equity options 

contracts sent to the Exchange for 

execution. The Exchange believes this 

incentive will allow the Exchange to 

remain competitive, while encouraging 

additional order flow in options 

overlaying SPY. The Exchange proposes 

to assess a $.05 per contract fee in SPY 

equity options that are directed to 

specialists, SQTs and RSQTs (‘‘Directed 

Participants’’ or ‘‘Directed Specialists, 

RSQTs, or SQTs’’6) by a member or 

member organization (‘‘Order Flow 

Provider’’ or ‘‘OFP’’)7, and executed 

electronically on the Exchange’s 

electronic trading platform for options, 

the Phlx XL II system. The $0.05 per 

contract rate would be assessed to the 

Direct Participants, in lieu of the equity 

options transactions fees of $.22 per 

contract side for Registered Option 

Traders (‘‘ROTs’’) (on-floor) and $.21 

per contract side for specialists on 

contracts executed electronically. 

Customers who are on the contra-side of 

a trade involving Directed Orders would 

not be subject to a fee and will remain 

free of charge. 

The Exchange currently provides a 

discount for ROTs (on-floor) and 

specialists that exceed 4.5 million 

contracts in a given month (the 

‘‘Volume Threshold’’) by assessing $ 

0.01 per contract on contract volume 

above the Volume Threshold instead of 

the applicable options transaction 

charges. The Exchange aggregates the 

trading activity of separate ROTs (onfloor) and specialists for purposes of the 

Volume Threshold if there is at least 

75% common ownership between the 

member organizations as reflected on 

each member organization’s Form BB, 

Schedule A. The Exchange proposes to 

assess a $0.01 per contract instead of a 

$0.05 per contract fee for SPY equity 

option transactions when the Directed 

Participant exceeds the 4.5 million 

contracts Volume Threshold in a given 

month. The contract volume associated 

with SPY equity options contracts, 

including the proposal to assess a $.05 

per contract fee in SPY equity options, 

would therefore be included in the 

Volume Threshold calculation and the 

$0.01 per contract rate would apply in 

the event a Directed Participant reaches 

the 4.5 million contracts Volume 

Threshold. 

2. Statutory Basis 

The Exchange believes that its 

proposal to amend its schedule of fees 

is consistent with Section 6(b) of the 

Act 8 in general, and furthers the 

objectives of Section 6(b)(4) of the Act 9

in particular, in that it is an equitable 

allocation of reasonable fees and other 

charges among Exchange members. 

Specifically, the Exchange believes that 

this proposal is equitable because it 

would apply evenly to specialists, SQTs 

and RSQTs transacting SPY equity 

options contracts sent to the Exchange 

for execution, in that any specialist, 

SQT or RSQT [sic] 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Act 10 and 

paragraph (f)(2) of Rule 19b–4 11

thereunder. At any time within 60 days 

of the filing of the proposed rule change, 

the Commission may summarily 

abrogate such rule change if it appears 

to the Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–Phlx–2009–73 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–Phlx–2009–73. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for inspection and copying in 

the Commission’s Public Reference 

Room on official business days between 

the hours of 10 a.m. and 3 p.m. Copies 

of such filing also will be available for 

inspection and copying at the principal 

offices of the Exchange. All comments 

received will be posted without change; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–Phlx– 

2009–73, and should be submitted on or 

before September 29, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–21457 Filed 9–4–09; 8:45 am] 

BILLING CODE 8010–01–P 


jlentini on DSKJ8SOYB1PROD with NOTICES