Federal Register / Vol. 77, No. 5 / Monday, January 9, 2012 / Notices 1101 

14 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See ISE Fee Schedule, page 18 (footnote 3). 

4See ISE Schedule of Fees, page 9. 

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 email to rulecomments@sec.gov. Please include File 

No. SR–Phlx–2011–178 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 No. 

SR–Phlx–2011–178. This file number 

should be included on the subject line 

if email 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 Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE., 

Washington, DC 20549, 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 office 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 No. SR–Phlx–2011– 

178 and should be submitted on or 

before January 30, 2012. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–95 Filed 1–6–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66082; File No. SR–C2– 

2011–041] 

Self-Regulatory Organizations; C2 

Options Exchange, Incorporated; 

Notice of Filing and Immediate 

Effectiveness of a Proposed Rule 

Change To Amend the Fees Schedule 

With Respect to Public Customer 

Maker/Taker Fee (Rebate) and 

Connectivity Charges 

January 3, 2012. 

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 December 

20, 2011, the C2 Options Exchange, 

Incorporated (‘‘Exchange’’ or ‘‘C2’’) filed 

with the Securities and Exchange 

Commission (‘‘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 

C2 proposes to amend its Fees 

Schedule. The text of the proposed rule 

change is available on the Exchange’s 

Web site (http://www.cboe.org/legal), at 

the Exchange’s Office of the Secretary, 

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 

self-regulatory organization 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 those 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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend its 

Fees Schedule. First, the Exchange 

proposes to amend its Maker and Taker 

fees and rebates with regards to Public 

Customer complex orders. Currently, 

the Exchange provides a Maker rebate of 

$0.25 per contract for such orders, and 

assesses no Taker fee. However, for 

competitive reasons, the Exchange 

desires to offer improved pricing for 

Public Customer complex orders. The 

International Securities Exchange, LLC 

(‘‘ISE’’) provides rebates of $0.30 per 

contract for both Makers and Takers for 

complex orders that trade with noncustomer orders in select high-volume, 

competitive classes.3 The Exchange 

hereby proposes to provide a rebate of 

$0.35 per contract for both Makers and 

Takers for complex orders, regardless of 

with whom such orders trade. By 

providing a higher rebate, and not 

limiting with whom such orders can 

trade nor in which classes the new 

rebates apply, the Exchange intends to 

attract a higher volume of customer 

trades and thereby provide other market 

participants with higher liquidity and 

greater trading opportunities. 

The Exchange also proposes to 

increase the fees charged for access to a 

Network Access Port (1 Gigabyte) to 

$500 per month for regular access and 

$1000 per month for Sponsored User 

access. The Exchange recently made a 

sizable investment to upgrade the 

equipment involved in the Network 

Access Port, and thereby proposes to 

increase the fees in order to recoup such 

costs and maintain such equipment in 

the future. The Exchange currently 

charges a different rate for regular access 

and Sponsored User access, and merely 

proposes to increase the rates in equal 

proportion. Moreover, this change in 

Network Access Port fees is in line with 

the amounts assessed for similar access 

at other exchanges. ISE assesses a fee of 

$500 for network access up to and 

including 1 gigabyte.4 Chicago Board 

Options Exchange, Incorporated 

(‘‘CBOE’’) also recently submitted a 

proposed rule change to increase the 

fees charged for access to a Network 

Access Port (1 Gigabyte) to $500 per 


tkelley on DSK3SPTVN1PROD with NOTICES
1102 Federal Register / Vol. 77, No. 5 / Monday, January 9, 2012 / Notices 

5See SR–CBOE–2011–121. 6See ISE Schedule of Fees, page 8 and SR–CBOE– 

2011–121. 7See NOM Rule 7053. 8See SR–CBOE–2011–121. 9 15 U.S.C. 78f(b). 

10 15 U.S.C. 78f(b)(4). 

11See ISE Schedule of Fees, page 18. 

12See ISE Schedule of Fees, page 9. 

13See ISE Schedule of Fees, page 8 and NOM 

Rule 7053 and also SR–CBOE–2011–121. 

14 15 U.S.C. 78s(b)(3)(A). 

15 17 CFR 240.19b–4(f)(2). 

month for regular access and $1000 per 

month for Sponsored User access.5

The Exchange also proposes to 

increase the fees charged for a CMI 

Login ID and FIX Login ID to $500 per 

month for regular access and $1000 per 

month for Sponsored User access. Firms 

may access C2 via either a CMI Client 

Application Server or a FIX Port, 

depending on how their systems are 

configured. As with the Network Access 

Port, the Exchange recently made a 

sizable investment to upgrade the 

equipment involved in the CMI Client 

Application Servers and FIX Ports, and 

thereby proposes to increase the fees in 

order to recoup such costs and maintain 

such equipment in the future. Moreover, 

these changes are in line with amounts 

assessed for connectivity at other 

exchanges. ISE assesses a FIX fee of 

$1200 for a minimum of two monthly 

login IDs (so, $600 for one), or a fee of 

$2,400 for a higher-volume user.6 The 

NASDAQ Stock Market LLC’s Options 

Market (‘‘NOM’’) assesses a fee of $500 

per FIX port per month, as well.7 CBOE 

also recently submitted a proposed rule 

change proposes to increase the fees 

charged for a CMI Login ID and FIX 

Login ID to $500 per month for regular 

access and $1000 per month for 

Sponsored User access.8 Regarding the 

Sponsored User fees, the Exchange 

currently charges a different rate for 

regular access and Sponsored User 

access, and merely proposes to increase 

the rates in equal proportion. 

The proposed changes are to take 

effect January 1, 2012. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the Act,9

in general, and furthers the objectives of 

Section 6(b)(4) 10 of the Act in 

particular, in that it is designed to 

provide for the equitable allocation of 

reasonable dues, fees, and other charges 

among Trading Permit Holders and 

other persons using Exchange facilities. 

The proposed change to increase the 

Maker and Taker rebates for Public 

Customer complex orders is reasonable 

because Public Customers will now be 

receiving a higher rebate than 

previously. This proposed change is 

equitable and not unfairly 

discriminatory because offering a greater 

rebate for such orders will attract more 

customer trading volume to the 

Exchange, and this greater volume and 

liquidity will benefit all market 

participants, including those non-Public 

Customer market participants who will 

now have more opportunities to trade 

with Public Customer orders. Further, 

this proposed change is in line with, 

and even more competitive than, the 

proposed fees on ISE for similar 

transactions.11

The proposed change to increase the 

Network Access Port fees is reasonable 

because the fees are within the same 

range as those assessed on other 

exchanges,12 and because such increase 

will assist in recouping expenditures 

recently made by the Exchange to 

upgrade the connectivity equipment. 

This proposed change is equitable and 

not unfairly discriminatory because the 

fees, as before, will be assessed to all 

market participants. The proposed 

changes to increase the fees assessed for 

CMI Login IDs and FIX Login IDs are 

also reasonable because such fees are 

within the same range as those assessed 

on other exchanges,13 and because such 

increases will assist in recouping 

expenditures recently made by the 

Exchange to upgrade the connectivity 

equipment. This proposed change is 

equitable and not unfairly 

discriminatory because the fees, as 

before, will be assessed to all market 

participants. Assessing higher fees for 

Sponsored Users is equitable and not 

unfairly discriminatory because 

Sponsored Users are able to access the 

Exchange and use the equipment 

provided without purchasing a trading 

permit. As such, Trading Permit Holders 

who have purchased a trading permit 

will have a higher level of commitment 

to transacting business on the Exchange 

and using Exchange facilities than 

Sponsored Users. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

C2 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 solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The proposed rule change is 

designated by the Exchange as 

establishing or changing a due, fee, or 

other charge, thereby qualifying for 

effectiveness on filing pursuant to 

Section 19(b)(3)(A) of the Act 14 and 

subparagraph (f)(2) of Rule 19b–4 15

thereunder. At any time within 60 days 

of the filing of the proposed rule change, 

the Commission summarily may 

temporarily suspend 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 email to rulecomments@sec.gov. Please include File 

Number SR–C2–2011–041 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–C2–2011–041. This file 

number should be included on the 

subject line if email 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 Web site viewing and 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 77, No. 5 / Monday, January 9, 2012 / Notices 1103 

16 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The term ‘‘Professional Order’’ means an order 

that is for the account of a person or entity that is 

not a Priority Customer. See ISR Rule 100(a)(37C). 

4The term ‘‘Non-ISE Market Maker’’ means a 

market maker as defined in Section 3(a)(38) of the 

Securities Exchange Act of 1934 (the ‘‘Act’’) 

registered in the same options class on another 

options exchange. See Schedule of Fees, page 4. 

5The term ‘‘market makers’’ refers to 

‘‘Competitive Market Makers’’ and ‘‘Primary Market 

Makers’’ collectively. See ISE Rule 100(a)(25). 

6The Select Symbols are identified by their ticker 

symbol on the Exchange’s Schedule of Fees. 

7See Securities Exchange Act Release No. 65548 

(October 13, 2011), 76 FR 64980 (October 19, 2011) 

(SR–ISE–2011–39). 

8See Securities Exchange Act Release No. 65958 

(December 15, 2011) (SR–ISE–2011–81). 

printing in the Commission’s Public 

Reference Room, 100 F Street NE., 

Washington, DC 20549, 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 office 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–C2– 

2011–041 and should be submitted on 

or before January 30, 2012. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.16

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–97 Filed 1–6–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66084; File No. SR–ISE– 

2011–84] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change Relating to Fees for Certain 

Complex Orders Executed on the 

Exchange 

January 3, 2012. 

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

Securities Exchange Act of 1934 (the 

‘‘Exchange Act’’ or the ‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 notice is hereby 

given that, on December 20, 2011, the 

International Securities Exchange, LLC 

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

the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I and II 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 ISE is proposing to amend fees 

for certain complex orders executed on 

the Exchange. The text of the proposed 

rule change is available on the 

Exchange’s Web site (http:// 

www.ise.com), 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 

self-regulatory organization 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 self-regulatory organization has 

prepared summaries, set forth in 

sections A, B and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of this proposed rule 

change is to amend fees charged by the 

Exchange for certain orders on two of 

the most actively-traded index option 

products, the NASDAQ 100 Index 

option (‘‘NDX’’) and the Russell 2000 

Index option (‘‘RUT’’). 

For trading in NDX and RUT, for both 

regular and complex orders, the 

Exchange currently charges $0.20 per 

contract for firm proprietary orders and 

Customer (Professional Orders), 3 and 

$0.45 per contract for Non-ISE Market 

Maker 4 orders. ISE market maker 

orders 5 in these two symbols are subject 

to a sliding scale, ranging from $0.01 per 

contract to $0.18 per contract, 

depending on the amount of overall 

volume traded by a market maker 

during a month. Market makers also 

currently pay a payment for order flow 

(PFOF) fee of $0.65 per contract when 

trading against Priority Customers. 

Priority Customer orders are not charged 

for trading in NDX and RUT. Options on 

NDX and RUT are traded on the 

Exchange pursuant to a license 

agreement entered into by the Exchange 

with index providers for NDX and RUT. 

In addition to the fees noted above, the 

Exchange currently charges ISE market 

maker orders, Non-ISE Market Maker 

orders and firm proprietary orders $0.22 

per contract and $0.15 per contract for 

NDX and RUT, respectively, to defray 

the licensing costs. Because of 

competitive pressures in the industry, 

certain customer orders are not charged 

this surcharge fee. The Exchange’s 

current fee schedule notes that Public 

Customer Orders are excluded from this 

surcharge fee. Historically, Public 

Customer orders were synonymous with 

retail customer orders. The Exchange 

now distinguishes retail customers from 

professional customers, the latter being 

professional traders who are not market 

makers or broker/dealers but behave the 

way that market makers and broker/ 

dealers do. Orders from these customers 

are identified on the Exchange as 

Professional Orders. Orders from retail 

customers are identified on the 

Exchange as Priority Customer orders. 

Thus, for the sake of clarity, the 

Exchange proposes to replace the words 

‘‘Public’’ with ‘‘Priority’’ for all the 

surcharge fees that appear on the 

Exchange’s fee schedule. Thus, Priority 

Customer orders will remain exempt 

from this fee, while Professional Orders 

will be subject to the fee. 

The Exchange currently assesses a per 

contract transaction fee to market 

participants that add or remove 

liquidity in the Complex Order Book 

(‘‘maker/taker fees’’) in symbols that are 

in the Penny Pilot program. Included 

therein is a subset of 103 symbols that 

are assessed a slightly higher taker fee 

(the ‘‘Select Symbols’’).6 Additionally, 

pursuant to SEC approval which allows 

market makers to enter quotations for 

complex order strategies in the Complex 

Order Book,7 the Exchange recently 

adopted maker/taker fees and rebates for 

orders in the following three symbols: 

XOP, XLB and EFA.8

The Exchange now proposes to extend 

its maker/taker fees and rebates to 

complex orders in NDX and RUT. 

Specifically, for Customer (Professional 

Orders), firm proprietary and ISE market 

maker orders, ISE proposes to adopt a 

‘‘make’’ fee of $0.25 per contract and a 

‘‘take’’ fee of $0.70 per contract. For 

Non-ISE Market Maker orders, ISE 

proposes to adopt a ‘‘make’’ fee of $0.25 

per contract and a ‘‘take’’ fee of $0.75 

per contract. For crossing complex 

orders in NDX and RUT, i.e., orders 

executed in the Exchange’s Facilitation 

Mechanism, Solicited Order 

Mechanism, Block Order Mechanism 

and Price Improvement Mechanism, and 


tkelley on DSK3SPTVN1PROD with NOTICES