Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Notices 28083 

7 15 U.S.C. 78f. 

8 15 U.S.C. 78f(b)(4). 

9 15 U.S.C. 78s(b)(3)(A)(ii). 

10 17 CFR 240.19b–4(f)(2). 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

follows: (1) The fees for directed orders 

designated as Intermarket Sweep Orders 

that execute at the NYSE will increase 

to $0.0023 from $0.0020 per share 

executed; (2) The fee for other directed 

orders that execute at the NYSE will 

increase to $0.0022 from $0.0019 per 

share executed for members with an 

average daily volume through the 

NASDAQ Market Center in all securities 

during the month of more than 35 

million shares of liquidity provided; (3) 

The fee for all for other directed orders 

that execute at the NYSE from members 

that do not reach the 35 million 

threshold will increase to $0.0023 from 

$0.0020 per share; (4) The fee for MOPP 

orders that execute at the NYSE will 

increase to $0.0023 from $0.0020 per 

share; and (5) The fee for TFTY orders 

that execute at the NYSE will increase 

to $0.0017 from $0.0014 per share. All 

other fees and pass-through fees remain 

unchanged. 

2. Statutory Basis 

NASDAQ believes that the proposed 

rule change is consistent with the 

provisions of Section 6 of the Act,7 in 

general, and with Section 6(b)(4) of the 

Act,8 in particular, in that it provides for 

the equitable allocation of reasonable 

dues, fees and other charges among 

members and issuers and other persons 

using any facility or system which 

NASDAQ operates or controls. The 

impact of the modest price increases 

upon the net fees paid by a particular 

market participant will depend upon a 

number of variables, including the 

routing strategies that it uses, the 

relative availability of liquidity on 

NASDAQ and other venues, the prices 

of the market participant’s quotes and 

orders relative to the national best bid 

and offer (i.e., its propensity to add or 

remove liquidity), and the types of 

securities that it trades. NASDAQ notes 

that it operates in a highly competitive 

market in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive. 

Accordingly, if particular market 

participants object to the proposed fee 

increases, they can avoid paying the fees 

by directing orders to other venues or 

using routing strategies and order types 

that are not subject to the increases. 

NASDAQ believes that its fees continue 

to be reasonable and equitably allocated 

to members on the basis of whether they 

opt to direct orders to NASDAQ. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

NASDAQ does not believe that the 

proposed rule change will result in any 

burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended. 

Because the market for order execution 

and routing is extremely competitive, 

members may readily direct orders to 

NASDAQ’s competitors if they object to 

the proposed rule change. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor 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 9 and 

subparagraph (f)(2) of Rule 19b–4 

thereunder.10 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–NASDAQ–2010–058 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–NASDAQ–2010–058. 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 Web site viewing and 

printing 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–NASDAQ–2010–058, and 

should be submitted on or before June 

9, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2010–11936 Filed 5–18–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62085; File No. SR–CHX– 

2010–08] 

Self-Regulatory Organizations; The 

Chicago Stock Exchange, Inc.; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change To Establish 

a Fixed Provide Credit for CHXRegistered Institutional Brokers 

May 12, 2010. 

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 April 30, 

2010, the Chicago Stock Exchange, Inc. 

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

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I, II and III 


jlentini on DSKJ8SOYB1PROD with NOTICES
28084 Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Notices 

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

4 17 CFR 240.19b–4(f)(2). 

5Section E.1 of the Fee Schedule defines ADV as 

follows: ‘‘ ‘ADV’ means, with respect to a 

Participant, the number of shares such Participant 

has executed as a liquidity provider in any and all 

trading sessions on average per trading day 

(excluding partial trading days) across all tapes on 

the trading facilities of the CHX (excluding all cross 

transactions and transactions in issues priced less 

than $1.00/share) for the calendar month in which 

the executions occurred.’’ 

6See, Section E.3. of the Fee Schedule. (‘‘If the 

institutional broker executes the order in the 

Matching System or as otherwise permitted by CHX 

rules, the institutional broker (not its customer) will 

be assessed applicable Matching System fees (see 

(1) and (2) above).’’) 

7Section E.1. of the Fee Schedule. 

8 Institutional Broker firms (formerly Floor 

Brokers under the Exchange’s old floor based 

trading model) are firms that primarily receive 

orders needing special handling and manual entry 

into the CHX system. These brokers are essentially 

order-entry firms for which the Exchange is the 

designated examining authority. 

9 15 U.S.C. 78f. 

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

below, which Items have been prepared 

by the Exchange. CHX has filed the 

proposal pursuant to Section 19(b)(3)(A) 

of the Act 3 and Rule 19b–4(f)(2) 

thereunder,4 which renders the proposal 

effective upon filing with the 

Commission. 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 CHX proposes to amend its 

Schedule of Participant Fees and 

Assessments (the ‘‘Fee Schedule’’), 

effective May 3, 2010, to establish a 

fixed provide credit for CHX-registered 

institutional brokers for agency trade 

executions of one-sided orders entered 

by their customers in Tape A, B and C 

securities which execute within the 

Exchange’s Matching System. The 

proposal also removes certain obsolete 

references to the now-defunct ITS 

trading system in the Fee Schedule. The 

text of this proposed rule change is 

available on the Exchange’s Web site at 

http://www.chx.com/rules/ 

proposed_rules.htm and in the 

Commission’s Public Reference Room, 

100 F Street, NE., Washington, DC 

20549. 

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 

CHX included statements concerning 

the purpose of and basis for the 

proposed rule changes and discussed 

any comments it received regarding the 

proposal. The text of these statements 

may be examined at the places specified 

in Item IV below. The CHX 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 

Through this filing, the Exchange 

would amend its Fee Schedule, effective 

May 3, 2010, to establish a non-variable 

credit for certain liquidity-providing 

single-sided orders submitted by CHXregistered Institutional Brokers on 

behalf of their customers to the 

Exchange’s Matching System and 

subsequently executed there. The 

Exchange’s Fee Schedule provides for a 

tiered schedule of fees and rebates for 

Participants for trade executions of 

single-sided orders in securities priced 

over $1 in the event that certain volume 

thresholds (described as the ‘‘Average 

Daily Volume’’ or ‘‘ADV’’) are achieved.5

For transactions subject to the Agency 

Execution fee of Section E.3., the Fee 

Schedule states that the take fees and 

provide credits accruing pursuant to 

Section E.1. (Matching System single 

order executions (one-sided orders of 

100+ shares)) shall be assessed against 

the Institutional Broker handling the 

transaction, and not the Participant 

which is a party to the transaction.6

Currently, the Institutional Broker is 

exempt from payment of the liquidity 

taking fee normally charged to 

Participants if it is handling an order 

subject to the Agency Execution fees.7

Pursuant to this filing, the Exchange 

would modify its Fee Schedule to state 

that Institutional Brokers would be 

entitled to a fixed provide credit 

irrespective of its ADV for orders subject 

to the Agency Execution fees. A provide 

credit of $0.0029/share in Tape A and 

C securities and $0.0032/share in Tape 

B securities priced $1.00/share or more 

would be paid to the Institutional 

Broker representing the Participant 

which originated the order (regardless of 

the ADV attributable to either firm). The 

filing also calls for a provide credit of 

0.20% of the trade value in Tape A, B 

and C securities priced less than $1.00/ 

share to be paid to the Institutional 

Broker representing the Participant 

which originated the order (regardless of 

the ADV attributable to either firm). 

Institutional Brokers are typically 

smaller firms that enter orders manually 

and cannot realistically achieve the 

higher ADV levels needed for 

preferential pricing.8 Payment of a fixed 

provide credit at a preferential rate to 

Institutional Brokers acts as an incentive 

to post liquidity in the CHX Matching 

System when those firms are 

considering how best to seek execution 

of their customer’s orders. 

Representation of such orders within 

the CHX Matching System in turn 

benefits the Exchange by potentially 

increasing transaction revenue (in the 

form of take fees for orders which 

interact with posted liquidity) and 

market data revenue. Creating a fixed 

provide rate which does not vary based 

upon the Institutional Broker’s ADV 

allows for a simple and consistent 

formula which these firms can rely 

upon when deciding to how to handle 

their customer’s orders. Furthermore, 

any market participant may apply for 

registration as a CHX Institutional 

Broker and, if eligible, avail themselves 

of the fixed provide credit. 

The Exchange also proposes to 

remove from Section E.1. and E.3. of the 

Fee Schedule certain obsolete references 

to the Intermarket Trading System 

(‘‘ITS’’) and the payment obligations 

relating to orders transmitted to other 

ITS participating markets through the 

ITS system. The ITS system was 

deactivated in 2007 and is no longer is 

use. The removal of these obsolete 

references will serve to eliminate a 

potential source of confusion for 

Exchange Participants. 

2. Statutory Basis 

The Exchange believes that 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) 

of the Act 10 in particular, in that it 

provides for the equitable allocation of 

reasonable dues, fees and other charges 

among its members. Among other 

things, the change to the Fee Schedule 

would provide incentives to Exchangeregistered Institutional Brokers to 

increase the amount of liquidity 

provided on our trading facilities, which 

may contribute to an increase in trading 

volume on the Exchange and in the 

income derived therefrom. The removal 

of the obsolete references to the 

Intermarket Trading System in the Fee 

Schedule will serve to eliminate a 

potential source of confusion for 

Exchange Participants. 

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. 


jlentini on DSKJ8SOYB1PROD with NOTICES
Federal Register / Vol. 75, No. 96 / Wednesday, May 19, 2010 / Notices 28085 

11 15 U.S.C. 78s(b)(3)(A)(ii). 

12 17 CFR 240.19b–4(f)(2). 

13 17 CFR 200.30–3(a)(12). 

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

2The specific language of the proposed 

interpretation can be found on OCC’s Web site at 

http://www.theocc.com/publications/rules/ 

proposed_changes/proposed_changes.jspU. 

3Securities Exchange Act Release No. 57895, 73 

FR 32066 (June 5, 2008). 

4Securities Exchange Act Release No. 59054, 73 

FR 75159 (Dec. 10, 2008). These filings also 

provided that futures on the exchange-traded funds 

in question would be cleared and treated as security 

futures. 

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. 

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 11 and 

subparagraph (f)(2) of Rule 19b–4 

thereunder 12 because it establishes or 

changes a due, fee, or other charge 

applicable only to a member imposed by 

the self-regulatory organization. 

Accordingly, the proposal is effective 

upon Commission receipt of the filing. 

At any time within 60 days of the filing 

of such 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 purpose 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–CHX–2010–08 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–CHX–2010–08. 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 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 

publicly available. All submissions 

should refer to File Number SR–CHX– 

2010–08 and should be submitted on or 

before June 9, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2010–11938 Filed 5–18–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62094; File No. SR–OCC– 

2010–07] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing of Proposed Rule Change 

Relating to Clearing Options on the 

CBOE Gold ETF Volatility Index 

May 13, 2010. 

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

Securities Exchange Act of 1934,1 notice 

is hereby given that on April 26, 2010, 

The Options Clearing Corporation 

(‘‘OCC’’) filed with the Securities and 

Exchange Commission the proposed 

rule change as described in Items I, II, 

and III below, which Items have been 

prepared primarily by OCC. 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 proposed rule change would 

allow OCC to add an interpretation 

following the introduction in Article 

XVII of OCC’s By-Laws to clarify that 

OCC will clear and treat as securities 

options any option contracts on the 

CBOE Gold ETF Volatility Index. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

OCC 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. OCC 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 

The purpose of the proposed rule 

change is to make clear that options on 

the CBOE Gold ETF Volatility Index, 

which is an index that measures the 

implied volatility of options on the 

SPDR Gold Trust, which is an exchangetraded fund designed to reflect the 

performance of gold bullion. To 

accomplish this purpose, OCC is 

proposing to add an interpretation 

following the introduction in Article 

XVII of OCC’s By-Laws, clarifying that 

OCC will clear and treat as securities 

options any option contracts on the 

CBOE Gold ETF Volatility Index.2 On 

May 30, 2008, the Commission 

approved rule filing SR–OCC–2008–07, 

which added a similar interpretation 

with respect to the treatment and 

clearing of options on shares of the 

SPDR Gold Trust.3 On December 4, 

2008, the Commission approved rule 

filings SR–OCC–2008–13 and SR–OCC– 

2008–14, which extended similar 

treatment to options on iShares®

COMEX Gold Shares and iShares®

Silver Shares.4 On February 25, 2010, 

the Commission approved rule filing 

SR–OCC–2009–20, which extended 

similar treatment to options and 

security futures on ETFS Physical Swiss 


jlentini on DSKJ8SOYB1PROD with NOTICES