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###### Securities and Exchange Commission

          - [Release No. 34-55582; File No. SR-ODD-2007-01] 

                    On March 13, 2007, The Options Clearing Corporation (“OCC”) submitted to the Securities and Exchange Commission (“Commission”), pursuant to Rule 9b-1 under the Securities Exchange Act of 1934 (“Act”),[1]                                          five preliminary copies of a supplement to its options disclosure document (“ODD”) reflecting certain changes to disclosure regarding rate-modified cash-settled foreign currency options (“Rate-Modified FCOs”).[2]                                          On April 3, 2007, the OCC submitted to the Commission five definitive copies of the supplement.[3] 

                    The ODD currently provides general disclosures on the characteristics and risks of trading standardize options. Recently, an options exchange amended its rules to permit the listing and trading of Rate-Modified FCOs.[4]                                          The proposed supplement, which supersedes and replaces the January 2007 Supplement to the ODD,[5]                                          provides disclosure on the characteristics of non-rate modified cash-settled foreign currency options (“Non-Rate Modified FCOs”) and adds new disclosure on the characteristics of Rate-Modified FCOs.                 

                    In addition to providing new disclosure on the characteristics of Rate-Modified FCOs, the proposed supplement to the ODD also reorganizes the January 2007 Supplement to distinguish disclosures regarding Non-Rate Modified FCOs from Rate-Modified FCOs, as well as providing a separate heading for certain disclosures pertaining to all dollar-denominated cash-settled foreign currency options. Further, the proposed supplement adds new clarification regarding exercise settlement values of Rate-Modified FCOs. The proposed supplement is intended to be read in conjunction with the more general ODD, which, as described above, discusses the characteristics and risks of options generally.[6] 

                    Rule 9b-1(b)(2)(i) under the Act [7]                                          provides that an options market must file five copies of an amendment or supplement to the ODD with the Commission at least 30 days prior to the date definitive copies are furnished to customers, unless the Commission determines otherwise, having due regard to the adequacy of information disclosed and the public interest and protection of investors.[8]                                          In addition, five copies of the definitive ODD, as amended or supplemented, must be filed with the Commission not later than the date the amendment or supplement, or the amended options disclosure document, is furnished to customers. The Commission has reviewed the proposed supplement and finds, having due regard to the adequacy of information disclosed and the public interest and protection of investors, that the proposed supplement may be furnished to customers as of the date of this order.                 

                    It is therefore ordered, pursuant to Rule 9b-1 under the Act,[9]                                          that definitive copies of the proposed supplement to the ODD (SR-ODD-2007-01), reflecting disclosure regarding Non-Rate Modified FCOs and adding disclosure regarding Rate-Modified FCOs, may be furnished to customers as of the date of this order.                 

                        For the Commission, by the Division of Market Regulation, pursuant to delegated authority.[10] 

Florence E. Harmon, 

Deputy Secretary. 

# Footnotes

1.                             17 CFR 240.9b-1.                     
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2.                                                     *See*                         letter from Jean M. Cawley, First Vice President and Deputy General Counsel, OCC, to Sharon Lawson, Senior Special Counsel, Division of Market Regulation (“Division”), Commission, dated March 5, 2007.                    
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3.                                                     *See*                         letter from Jean M. Cawley, First Vice President and Deputy General Counsel, OCC, to Sharon Lawson, Senior Special Counsel, Division, Commission, dated April 3, 2007.                    
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4.                                                     *See*                         Securities Exchange Act Release No. 55575 (April 3, 2007) (approving File No. SR-ISE-2006-59).                    
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5.                                                     *See*                         Securities Exchange Act Release No. 55035 (December 29, 2006), 72 FR 1358 (January 11, 2007) (SR-ODD-2006-01) (“January 2007 Supplement”).                    
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6.                             The Commission notes that the options markets must continue to ensure that the ODD is in compliance with the requirements of Rule 9b-1(b)(2)(i) under the Act, 17 CFR 240.9b-1(b)(2)(i), including when future changes are made regarding Non-Rate Modified FCOs and Rate-Modified FCOs. Any future changes to the rules of the options markets would need to be submitted to the Commission under Section 19(b) of the Act. 15 U.S.C. 78s(b).                    
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7.                             17 CFR 240.9b-1(b)(2)(i).                     
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8.                             This provision permits the Commission to shorten or lengthen the period of time which must elapse before definitive copies may be furnished to customers.                    
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9.                             17 CFR 240.9b-1.                     
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10.                                 17 CFR 200.30-3(a)(39).                         
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 [FR Doc. E7-6709 Filed 4-9-07; 8:45 am] 

BILLING CODE 8010-01-P