Federal Register / Vol. 75, No. 98 / Friday, May 21, 2010 / Notices 28669 

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

2 17 CFR 240.19b–4. 

3For a complete description of Phlx XL II, see 

Securities Exchange Act Release No. 59995 (May 

28, 2009), 74 FR 26750 (June 3, 2009) (SR–Phlx– 

2009–32). The instant proposed fees will apply only 

to option orders entered into, and routed by, the 

Phlx XL II system. 

4See Securities Exchange Act Release No. 59995 

(May 28, 2009), 74 FR 26750 (June 3, 2009) (SR– 

Phlx–2009–32). 

5The Exchange defines a ‘‘professional’’ as any 

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

securities, and (ii) places more than 390 orders in 

listed options per day on average during a calendar 

month for its own beneficial account(s) (hereinafter 

‘‘Professional’’). 

6See SR–ISE–2010–41. 

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

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). 

been added, deleted or postponed, 

please contact: 

The Office of the Secretary at (202) 

551–5400. 

Dated: May 19, 2010. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2010–12366 Filed 5–19–10; 4:15 pm] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62105; File No. SR–Phlx– 

2010–71] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX, Inc.; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to 

Professional Routing Fees 

May 13, 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 May 7, 

2010, 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 amend its 

fees governing pricing for Exchange 

members using the Phlx XL II system,3

for routing standardized equity and 

index option professional orders to 

away markets for execution. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://nasdaqtrader.com/ 

micro.aspx?id=PHLXfilings, at the 

principal office of the Exchange, at the 

Commission’s Public Reference Room, 

and on the Commission’s Web site at 

http://www.sec.gov. 

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 purpose of the proposed rule 

change is to recoup costs that the 

Exchange incurs for routing and 

executing professional orders in equity 

and index options to away markets. 

In May 2009, the Exchange adopted 

Rule 1080(m)(iii)(A) to establish Nasdaq 

Options Services LLC (‘‘NOS’’), a 

member of the Exchange, as the 

Exchange’s exclusive order router.4 NOS 

is utilized by the Phlx XL II system 

solely to route orders in options listed 

and open for trading on the Phlx XL II 

system to destination markets. 

Currently, the Exchange’s Fee 

Schedule includes Routing Fees for 

customer and professional orders. The 

Exchange currently assesses a fee of $.06 

per contract in all professional 5 option 

orders that are routed to International 

Securities Exchange, LLC (‘‘ISE’’). 

The Exchange proposes to amend the 

current fee of $.06 per contract that is 

assessed for routing professional orders 

to ISE in all options to $.24 per contract. 

The Exchange is proposing this charge 

in order to recoup clearing and 

transaction charges which are incurred 

by the Exchange when orders are routed 

to ISE. Each destination market’s 

transaction charge varies and there is a 

standard clearing charge for each 

transaction incurred by the Exchange. 

The Exchange proposes this fee change 

to account for an increase in cost for 

routing to ISE.6

As with all fees, the Exchange may 

adjust these Routing Fees in response to 

competitive conditions by filing a new 

proposed rule change. While changes to 

the Exchange’s Fee Schedule pursuant 

to this proposal are effective upon filing, 

the Exchange has designated this 

proposal to be operative for trade date 

May 10, 2010. 

2. Statutory Basis 

The Exchange believes that its 

proposal to amend its schedule of fees 

is consistent with Section 6(b) of the 

Act 7 in general, and furthers the 

objectives of Section 6(b)(4) of the Act 8

in particular, in that it is an equitable 

allocation of reasonable fees and other 

charges among Exchange members. The 

Exchange believes that this fee is 

equitable because it would be equally 

assessed on all professional orders 

routed to ISE. The Exchange also 

believes that this fee is reasonable 

because the Exchange is seeking to 

recoup the costs incurred by the 

Exchange to route professional orders to 

ISE on behalf of its members. 

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 9 and paragraph 

(f)(2) of Rule 19b–4 10 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, 


emcdonald on DSK2BSOYB1PROD with NOTICES
28670 Federal Register / Vol. 75, No. 98 / Friday, May 21, 2010 / Notices 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6). 

5Any Exchange Member that has an MPID issued 

by FINRA is identified in the Exchange’s internal 

systems by that MPID. Each Exchange Member that 

does not already have an MPID and each Sponsored 

Participant is issued an identifier that is specific to 

the Exchange and allows the Exchange to determine 

the User for each order and trade. 

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–2010–71 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-2010–71. 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 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–Phlx2010–71 and should be submitted on or 

before June 11, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–12227 Filed 5–20–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62102; File No. SR–BATS– 

2010–011] 

Self-Regulatory Organizations; BATS 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend BATS Rule 

11.9, Entitled ‘‘Orders and Modifiers’’ 

May 13, 2010. 

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 May 4, 

2010, BATS Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BATS’’) 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 Exchange. The Exchange has 

designated this proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(6)(iii) 

thereunder,4 which renders it 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 Substance of 

the Proposed Rule Change 

The Exchange proposes to make a 

modification to the existing technology 

that it provides to a User that wishes to 

avoid trading against orders from that 

same User (currently referred to as 

‘‘Member Match Trade Prevention’’ or 

‘‘MMTP’’). 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at http://www.batstrading.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 parts 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 make a 

minor change to its Member Match 

Trade Prevention, or MMTP, 

functionality, described in BATS Rules 

11.9(f) and 21.1(g) and to rename the 

functionality as Match Trade Prevention 

(‘‘MTP’’). 

MMTP modifiers are designed to 

prevent two orders with the same 

Unique Identifier (as defined below) 

from executing against each other. The 

Exchange currently offers four MMTP 

modifiers that can be set at the market 

participant identifier (‘‘MPID’’), the 

Exchange Member identifier or the 

Exchange Sponsored Participant 

identifier level (any such identifier, a 

‘‘Unique Identifier’’).5 BATS is 

proposing a change to the MMTP 

Decrement and Cancel identifier 

(‘‘MDC’’); none of the other MMTP 

identifiers are affected by this proposal, 

other than to change the references 

throughout the rule text to MTP. 

Under the existing rules, an incoming 

order marked with the MDC modifier 

will not execute against opposite side 

resting interest marked with any MMTP 

modifier originating from the same 

Unique Identifier. If both orders are 

equivalent in size, both orders will be 

cancelled back to the originating User. 

If the orders are not equivalent in size, 

the equivalent size will be cancelled 

back to the originating User and the 

larger order will be decremented by the 

size of the smaller order, with the 

balance remaining on the BATS Book; 

provided, however, that if the resting 

order is marked with any MMTP 

modifier other than MDC, and the 

incoming order is smaller in size than 

the resting order, then both orders will 

be cancelled back to the originating User 

(the ‘‘MDC Exception’’). Thus, as shown 

in the example below, rather than 

decrementing either order, pursuant to 

the MDC Exception both orders are 

cancelled in their entirety when the 

resting order contains an MMTP 

modifier other than MDC and is larger 

than the incoming order. 

Current MDC Exception—Example: 

An order to buy 500 shares @ $22.00 is 


emcdonald on DSK2BSOYB1PROD with NOTICES