1898 Federal Register / Vol. 78, No. 6 / Wednesday, January 9, 2013 / Notices 

24 15 U.S.C. 78s(b)(3)(A). 

25 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires a self-regulatory organization to 

provide the Commission with written notice of its 

intent to file the proposed rule change, along with 

a brief description and text of the proposed rule 

change, at least five business days prior to the date 

of filing of the proposed rule change, or such 

shorter time as designated by the Commission. The 

Exchange has fulfilled this requirement. 

26For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

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

27See, e.g., Security Exchange Act Release Nos. 

57654 (April 11, 2008), 73 FR 21003 (April 17, 

2008) (SR–NASDAQ–2008–028) and 57936 (June 6, 

2008), 73 FR 33481 (June 12, 2008) (SR–Phlx–2008– 

36). See also NYSE MKT Rule 904C, CBOE Rule 

24.4, and Phlx Rule 1001A. 

28 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The term ‘‘Professional’’ means any person or 

entity that (i) is not a broker or dealer in securities, 

and MNX options for other options 

exchanges, and the Exchange believes 

that harmonizing the standard across 

options markets will enable market 

participants to handle trading in NDX 

and MNX options similarly regardless of 

which options market in which they are 

trading. 

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 that is 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 

Because the foregoing proposed rule 

change: (1) Does not significantly affect 

the protection of investors or the public 

interest; (2) does not impose any 

significant burden on competition; and 

(3) by its terms does not become 

operative for 30 days after the date of 

this filing, or such shorter time as the 

Commission may designate if consistent 

with the protection of investors and the 

public interest, the proposed rule 

change has become effective pursuant to 

Section 19(b)(3)(A) of the Act 24 and 

Rule 19b–4(f)(6) thereunder.25

A proposed rule change filed under 

Rule 19b–4(f)(6) normally does not 

become operative for 30 days after the 

date of filing. However, Rule 19b– 

4(f)(6)(iii) permits the Commission to 

designate a shorter time if such action 

is consistent with the protection of 

investors and the public interest. The 

Exchange requests that the Commission 

waive the 30-day operative delay so that 

it can list and trade NDX and MNX 

options with no position limits without 

delay. The Commission believes that 

waiving the 30-day operative delay is 

consistent with the protection of 

investors and the public interest.26 The 

Commission notes the proposal is 

substantively identical to prior 

proposed rule changes and existing 

rules of other exchanges, and does not 

raise any new regulatory issues.27 For 

these reasons, the Commission 

designates the proposed rule change as 

operative upon filing. 

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–NYSEArca–2012–140 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–NYSEArca–2012–140. 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 

10:00 a.m. and 3:00 p.m. Copies of the 

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– 

NYSEArca–2012–140 and should be 

submitted on or before January 30, 2013. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.28

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2013–00196 Filed 1–8–13; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–68577; File No. SR–Phlx– 

2012–141] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NASDAQ 

OMX PHLX LLC Relating to 

Professional Options Transaction 

Charges 

January 3, 2013. 

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 

21, 2012, NASDAQ OMX PHLX LLC 

(‘‘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 amend 

certain electronic Professional 3 Options 


srobinson on DSK4SPTVN1PROD with 
Federal Register / Vol. 78, No. 6 / Wednesday, January 9, 2013 / Notices 1899 

and (ii) places more than 390 orders in listed 

options per day on average during a calendar month 

for its own beneficial account(s). See Rule 

1000(b)(14). 

4Section II of the Pricing Schedule includes 

options overlying equities, ETFs, ETNs, and indexes 

which are Multiply Listed. 

5The Penny Pilot was established in January 

2007; and in October 2009, it was expanded and 

extended through June 30, 2012. See Securities 

Exchange Act Release Nos. 55153 (January 23, 

2007), 72 FR 4553 (January 31, 2007) (SR–Phlx– 

2006–74) (notice of filing and approval order 

establishing Penny Pilot); 60873 (October 23, 2009), 

74 FR 56675 (November 2, 2009) (SR–Phlx–2009– 

91) (notice of filing and immediate effectiveness 

expanding and extending Penny Pilot); 60966 

(November 9, 2009), 74 FR 59331 (November 17, 

2009) (SR–Phlx–2009–94) (notice of filing and 

immediate effectiveness adding seventy-five classes 

to Penny Pilot); 61454 (February 1, 2010), 75 FR 

6233 (February 8, 2010) (SR–Phlx–2010–12) (notice 

of filing and immediate effectiveness adding 

seventy-five classes to Penny Pilot); 62028 (May 4, 

2010), 75 FR 25890 (May 10, 2010) (SR–Phlx–2010– 

65) (notice of filing and immediate effectiveness 

adding seventy-five classes to Penny Pilot); 62616 

(July 30, 2010), 75 FR 47664 (August 6, 2010) (SR– 

Phlx–2010–103) (notice of filing and immediate 

effectiveness adding seventy-five classes to Penny 

Pilot); 63395 (November 30, 2010), 75 FR 76062 

(December 7, 2010) (SR–Phlx–2010–167) (notice of 

filing and immediate effectiveness extending the 

Penny Pilot); 65976 (December 15, 2011), 76 FR 

79247 (December 21, 2011) (SR–Phlx–2011–172) 

(notice of filing and immediate effectiveness 

extending the Penny Pilot); and 67326 (June 29, 

2012), 77 FR 40126 (July 6, 2012) (SR–Phlx–2012– 

86) (notice of filing and immediate effectiveness 

extending the Penny Pilot). See also Exchange Rule 

1034. 

6Non-Penny Pilot refers to options classes not in 

the Penny Pilot. 

7Today, the Specialist, Market Maker, BrokerDealer and Firm fees are differentiated between 

electronic and firm fees. 

8A ‘‘Specialist’’ is an Exchange member who is 

registered as an options specialist pursuant to Rule 

1020(a). 

9A ‘‘Market Maker’’ includes Registered Options 

Traders (Rule 1014(b)(i) and (ii)), which includes 

Streaming Quote Traders (see Rule 1014(b)(ii)(A)) 

and Remote Streaming Quote Traders (see Rule 

1014(b)(ii)(B)). Directed Participants are also market 

makers. 

10Broker-Dealers are assessed a Penny Pilot 

Options Transaction Charge of $0.45 per contract 

for electronic orders and a non-Penny Pilot Options 

Transaction Charge of $0.60 for electronic orders. 

11Firms are assessed a Penny Pilot Options 

Transaction Charge of $0.40 per contract for 

electronic orders and a non-Penny Pilot Options 

Transaction Charge of $0.45 for electronic orders. 

12A FLEX option is a customized option that 

provides parties to the transaction with the ability 

to fix terms including the exercise style, expiration 

date, and certain exercise prices. See Exchange Rule 

1079. FLEX Options are a trademark of the Chicago 

Board Options Exchange. 

13An ‘‘accommodation’’ or ‘‘cabinet’’ trade refers 

to trades in listed options on the Exchange that are 

worthless or not actively traded. Cabinet trading is 

generally conducted in accordance with Exchange 

Rules, except as provided in Exchange Rule 1059 

entitled ‘‘Accommodation Trading’’, which sets 

forth specific procedures for engaging in cabinet 

trading below $1 per option contract. Cabinet or 

accommodation trading of option contracts is 

intended to accommodate persons wishing to effect 

closing transactions in those series of options dealt 

in on the Exchange for which there is no auction 

market. 

14The Exchange’s systems do not allow for FLEX 

or Cabinet transactions to be executed 

electronically. 

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

16 15 U.S.C. 78f(b)(4). 

17The Chicago Board Options Exchange 

Incorporated (‘‘CBOE’’) assesses professionals and 

voluntary professionals a $0.30 per contract 

transaction fee for electronic orders. See CBOE’s 

Fees Schedule. See also NYSE Amex LLC’s (‘‘NYSE 

Amex’’) Fee Schedule, which assesses Professional 

Customers a $0.32 per contract fee for electronic 

Continued 

Transaction Charges in Section II 4 of 

the Exchange’s Pricing Schedule 

entitled ‘‘Multiply Listed Options.’’ 

While changes to the Pricing 

Schedule pursuant to this proposal are 

effective upon filing, the Exchange has 

designated the proposed amendment to 

be operative on January 2, 2013. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http:// 

nasdaqomxphlx.cchwallstreet.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 

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. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend 

Section II of the Exchange’s Pricing 

Schedule to increase the electronic 

Professional Options Transaction 

Charges for both Penny Pilot Options 5

and non-Penny Pilot Options.6 The 

Exchange believes that increasing the 

electronic Professional Options 

Transaction Charges in Penny Pilot and 

non-Penny Pilot Options will allow the 

Exchange to compete more effectively. 

The Exchange also believes that the 

proposed fees will operate to assist the 

Exchange in recouping increased costs 

generally tied to supporting a larger 

number of options classes, option series 

and overall transaction volume. 

Specifically, the Exchange proposes to 

increase the electronic Professional 

Options Transaction Charges for both 

Penny Pilot Options and non-Penny 

Pilot Options from $0.25 to $0.30 per 

contract. The Exchange is not proposing 

to increase the floor Professional 

Options Transaction Charges or any 

other electronic Professional transaction 

charges. 

The Exchange also proposes to amend 

its Pricing Schedule at Section II to add 

another column to the Professional fees 

to differentiate electronic and floor fees 

as it does today with other market 

participants.7 The Exchange also 

proposes a technical amendment to the 

Specialist,8 Market Maker,9 BrokerDealer 10 and Firm 11 transaction fees to 

correct the Pricing Schedule to note an 

‘‘N/A’’ for electronic FLEX 12 and 

Cabinet 13 Options pricing instead of 

$0.10 per contract. While the $0.10 per 

contract fee is noted on the Pricing 

Schedule, no market participant has 

been assessed that fee because FLEX 

and Cabinet Options are transacted on 

the Exchange’s trading floor and are not 

transacted electronically.14 The 

Exchange proposes to note ‘‘N/A’’ for 

those electronic fees because these types 

of transactions are not able to be 

executed electronically on the Exchange 

and this would correct the Pricing 

Schedule to reflect no fee is being 

assessed. 

2. Statutory Basis 

The Exchange believes that its 

proposal to amend its Pricing Schedule 

is consistent with Section 6(b) of the 

Act 15 in general, and furthers the 

objectives of Section 6(b)(4) of the Act 16

in particular, in that it is an equitable 

allocation of reasonable fees and other 

charges among Exchange members and 

other persons using its facilities. 

The Exchange’s proposal to increase 

the electronic Professional Options 

Transaction Charges in both Penny Pilot 

and non-Penny Pilot Options is 

reasonable because of the greater costs 

incurred by the Exchange associated 

with supporting a larger number of 

options classes, option series and 

overall transaction volume. Also, the 

Exchange believes increasing the 

electronic Professional Options 

Transaction Charges in both Penny Pilot 

and non-Penny Pilot Options from $0.25 

to $0.30 per contract is reasonable 

because the $0.05 per contract increase 

would allow the Exchange to recoup the 

aforementioned costs while also 

continuing to assess a Professional a rate 

that is lower than Broker-Dealer and 

Firm electronic rates. Also, the 

increased Professional fees are 

comparable with electronic Professional 

fees at other options exchanges.17


srobinson on DSK4SPTVN1PROD with 
1900 Federal Register / Vol. 78, No. 6 / Wednesday, January 9, 2013 / Notices 

orders which take liquidity from 1 to 16,999 

contracts. 

18See Exchange Rule 1014 entitled ‘‘Obligations 

and Restrictions Applicable to Specialists and 

Registered Options Traders.’’ 

19A transaction resulting from an order that was 

electronically delivered utilizes Phlx XL II. See 

Exchange Rules 1014 and 1080. Electronically 

delivered orders do not include orders transacted 

on the Exchange floor. A transaction resulting from 

an order that is non-electronically-delivered is 

represented on the trading floor by a floor broker. 

See Exchange Rule 1063. All orders will be either 

electronically or non-electronically delivered. 

20CBOE assesses a Professional and Voluntary 

Professional a $0.25 per contract manual fee in 

Penny and Non-Penny Classes and assesses a $0.45 

per contract electronic fee in Penny and a $0.60 per 

contract electronic fee in Non-Penny Pilot Options. 

NYSE Amex assesses a $0.25 per contract fee for 

manual Professional Customer transactions and a 

tiered electronic Professional Customer rate starting 

at $.32 per contract for electronic orders which take 

liquidity from 1 to 16,999 contracts. 21 15 U.S.C. 78s(b)(3)(A)(ii). 

The Exchange’s proposal to increase 

the electronic Professional Options 

Transaction Charges in both Penny Pilot 

and non-Penny Pilot Options is 

equitable and not unfairly 

discriminatory because Professionals 

would continue to be assessed lower 

fees as compared to Broker-Dealers and 

Firms with respect to electronic options 

transactions charges. Market Makers and 

Specialists would be assessed lower 

fees, both electronic and floor, as 

compared to Professionals, because 

Market Makers and Specialists have 

burdensome quoting obligations 18 to 

the market which do not apply to 

Professionals, Customers, Firms and 

Broker-Dealers. Customers are not 

assessed Options Transactions Charges 

in either Penny Pilot or non-Penny Pilot 

Options because Customer order flow 

brings liquidity to the market, which in 

turn benefits all market participants. 

Broker-Dealers and Firms today pay 

higher fees as compared to a 

Professional for electronic transactions 

and this is not changing. The 

Professional Options Transaction 

Charges in both Penny Pilot and nonPenny Pilot Options for non-electronic 

transactions or floor transactions would 

remain unchanged. 

The Exchange believes that assessing 

higher electronic Options Transaction 

Charges in both Penny Pilot and nonPenny Pilot Options of $0.30 per 

contract as compared to a floor Options 

Transaction Charge in both Penny Pilot 

and non-Penny Pilot Options of $0.25 

per contract is reasonable, equitable and 

not unfairly discriminatory because 

these fees recognize the distinction 

between the floor order entry model and 

the electronic model and the proposed 

fees respond to competition along the 

same lines.19 Floor participants incur 

costs associated with accessing the 

floor, i.e. need for a floor broker, and 

other costs which are not born by 

electronic members. Today, the 

Exchange assesses different fees for 

electronic as compared to floor 

transactions for Firms, Broker-Dealers, 

Specialists and Market Makers in 

Section II of the Pricing Schedule. The 

Exchange is proposing to likewise 

distinguish electronic and floor 

Professional Options Transactions 

Charges in both Penny and non-Penny 

Pilot Options. Other options exchanges 

likewise distinguish floor and electronic 

fees for Professionals.20 The Exchange 

believes that the proposed fees are in 

line with similar fees offered on other 

exchanges. 

The Exchange operates in a highly 

competitive market, comprised of 

eleven exchanges, in which market 

participants can easily and readily 

direct order flow to competing venues if 

they deem fee and rebate levels at a 

particular venue to be excessive. 

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. The 

Exchange believes that the proposed 

electronic Professional Options 

Transaction Charges in Penny and nonPenny Pilot Options remain competitive 

with fees at other options exchanges. 

The Exchange believes that the 

proposed fees are competitive and do 

not misalign the differentials currently 

assessed with respect to other market 

participants. Market participants can 

easily and readily direct order flow to 

competing venues if they deem fee and 

rebate levels at a particular venue to be 

excessive. Accordingly, the fees that are 

assessed and the rebates paid by the 

Exchange must remain competitive with 

fees charged and rebates paid by other 

venues and therefore must continue to 

be reasonable and equitably allocated to 

those members that opt to direct orders 

to the Exchange rather than competing 

venues. 

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.21 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. If the Commission 

takes such action, the Commission shall 

institute proceedings to determine 

whether the proposed rule should be 

approved or disapproved. 

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–Phlx–2012–141 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–2012–141. 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 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 


srobinson on DSK4SPTVN1PROD with 
Federal Register / Vol. 78, No. 6 / Wednesday, January 9, 2013 / Notices 1901 

22 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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–Phlx–2012–141 and should 

be submitted on or before January 30, 

2013. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.22

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2013–00256 Filed 1–8–13; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 3468570; File No. SR–ISE– 

2012–82] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change To Make Non-Substantive, 

Technical Corrections to ISE Rules 

January 3, 2013. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on December 

21, 2012, the International Securities 

Exchange, LLC (the ‘‘Exchange’’ or 

‘‘ISE’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’) 

the proposed rule change as described 

in Items I and II below, which Items 

have been prepared by the selfregulatory organization. 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 the Substance 

of the Proposed Rule Change 

The Exchange proposes to make a 

number of non-substantive, technical 

corrections to its rules. Examples of 

such technical corrections include 

updating ISE rule number citations and 

cross references, correcting 

typographical errors, deleting obsolete 

rule text, and updating references to 

outdated terms, such as changing 

references from the National 

Association of Securities Dealers 

(‘‘NASD’’) to Financial Industry 

Regulatory Authority (‘‘FINRA’’). The 

text of the proposed rule change is 

available on the Exchange’s Internet 

Web site at 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 the 

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. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange is proposing to make a 

number of non-substantive, technical 

corrections to its rules. Examples of 

such technical corrections include 

updating ISE rule number citations and 

cross references, correcting 

typographical errors, deleting obsolete 

rule text, and updating references to 

outdated terms, such as changing 

references from NASD to FINRA. 

Following is a narrative description of 

each of the corrections: 

• The Table of Contents to the ISE 

Rules is being amended to reflect that 

ISE Rule 718 is now ‘‘Reserved’’ since 

ISE Rule 718 (Accommodation 

Liquidations (Cabinet Trades)) was 

deleted. 

• The Table of Contents is being 

amended to make conforming changes 

to the title of ISE Rule 720 (Obvious and 

Catastrophic Errors) so that it matches 

the title as it appears in the rules. 

• ISE Rule 210 (Liability for Payment 

of Fees) is being amended to update an 

incorrect rule cross-reference number in 

paragraph (a). 

• ISE Rule 312 (Limitation on 

Affiliation between the Exchange and 

Members) is being amended to delete 

references in paragraph (a) to Maple 

Merger Sub LLC because that subsidiary 

no longer exists. Paragraphs (b) and (c) 

are being deleted since the Exchange is 

no longer affiliated with Direct Edge 

ECN LLC (‘‘DE ECN’’), DE ECN is no 

longer a facility of the Exchange, and 

ISE (including its affiliates) no longer 

maintains an ownership interest in 

Ballista Securities LLC. Since 

paragraphs (b) and (c) are being deleted, 

the opening paragraph no longer needs 

to be designated as paragraph (a), so the 

(a) is being deleted. 

• ISE Rule 604 (Continuing Education 

for Registered Persons) is being 

amended to change a reference in 

paragraph (b) from NASD to FINRA and 

brackets are being changed to 

parentheses wherever they appear 

throughout the rule. 

• ISE Rule 704 (Collection and 

Dissemination of Quotations) is being 

amended to change references in 

paragraphs (a) and (b) from Rule 11Ac1– 

1 to Rule 602 of Regulation NMS. 

• ISE Rule 713 (Priority of Quotes and 

Orders) is being amended to update an 

incorrect rule cross-reference number in 

paragraph (a), as well as to add nonsubstantive words to correct the 

sentence structure of paragraph (a). 

Additionally, Supplementary Material 

.03 to ISE Rule 713 was amended to 

update an incorrect rule cross-reference 

number in paragraph (d). 

• ISE Rule 715 (Types of Orders) is 

being amended to correct the defined 

term of ‘‘Priority Customer Orders’’ in 

paragraph (g), and to correct the defined 

term of ‘‘Add Liquidity Order’’ in 

paragraph (n). In addition, 

Supplementary Material .02 to ISE Rule 

713 is being moved into ISE Rule 713 

itself as new paragraphs (o), (p), and (q), 

since ISE has fully-migrated to its new 

trading system, Optimise. Thus, it is no 

longer necessary to separately maintain 

those order types in the Supplementary 

Material. 

• ISE Rule 718 (Accommodation 

Liquidations (Cabinet Trades)) is being 

deleted in its entirety, since that trading 

functionality is not offered in Optimise, 

and therefore not possible on the 

Exchange. ISE Rule 718 is now 

‘‘Reserved.’’ 

• ISE Rule 722 (Complex Orders) is 

being amended to delete the obsolete 

clause to ISE’s Optimise platform in 

Supplementary Material .03 and .04. In 

addition, ISE Supplementary Material 

.05 is being amended to correct the 

defined term ‘‘Priority Customer 

Orders’’, to insert a missing word, and 

to update an incorrect rule crossreference number. 

• ISE Rule 723 (Price Improvement 

Mechanism for Crossing Transactions) is 

being amended to delete paragraph 

(d)(6) since that trading functionality is 

not offered in Optimise. As a result, the 

corresponding sentence that crossreferenced paragraph (d)(6) is being 

deleted from Supplementary Material 

.05 and .09. 


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