50376 Federal Register / Vol. 73, No. 166 / Tuesday, August 26, 2008 / Notices 

8 15 U.S.C. 78k–1. 

9 17 CFR 242.608(b)(4). 

10 17 CFR 200.30–3(a)(29). 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6). 

2 into effect summarily upon 

publication of this notice on a 

temporary basis. The Commission 

believes that such action is appropriate 

in the public interest, for the protection 

of investors, and the maintenance of fair 

and orderly markets because it will 

allow the options exchanges to 

implement the initiative to reduce quote 

message traffic beginning immediately. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether proposed 

Amendment No. 2 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 4–443 in the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number 4–443. 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 inspection and copying in 

the Commission’s Public Reference 

Section, 100 F Street, NE., Washington, 

DC 20549–1090 on 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 Exchanges. 

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 4–443 and should be submitted 

on or before September 16, 2008. 

V. Conclusion 

It is therefore ordered, pursuant to 

Section 11A of the Act,8 and Rule 608 

thereunder 9 that proposed Amendment 

No. 2 be, and it hereby is, approved on 

a temporary basis until December 17, 

2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–19782 Filed 8–25–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meeting 

Notice is hereby given, pursuant to 

the provisions of the Government in the 

Sunshine Act, Public Law 94–409, that 

the Securities and Exchange 

Commission will hold a Closed Meeting 

on Thursday, August 28, 2008 at 2 p.m. 

Commissioners, Counsel to the 

Commissioners, the Secretary to the 

Commission, and recording secretaries 

will attend the Closed Meeting. Certain 

staff members who have an interest in 

the matters also may be present. 

The General Counsel of the 

Commission, or his designee, has 

certified that, in his opinion, one or 

more of the exemptions set forth in 5 

U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) 

and 17 CFR 200.402(a)(3), (5), (7), 9(ii) 

and (10), permit consideration of the 

scheduled matters at the Closed 

Meeting. 

Commissioner Aguilar, as duty 

officer, voted to consider the items 

listed for the Closed Meeting in closed 

session. 

The subject matter of the Closed 

Meeting scheduled for Thursday, 

August 28, 2008 will be: 

Formal orders of investigation; 

Institution and settlement of 

injunctive actions; 

Institution and settlement of 

administrative proceedings of an 

enforcement nature; 

Resolution of litigation matters; and 

Other matters relating to enforcement 

proceedings. 

At times, changes in Commission 

priorities require alterations in the 

scheduling of meeting items. 

For further information and to 

ascertain what, if any, matters have been 

added, deleted or postponed, please 

contact: The Office of the Secretary at 

(202) 551–5400. 

Dated: August 21, 2008. 

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–19791 Filed 8–25–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 58387; File No. SR–CBOE–

2008–83] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change Related to Complex 

Order Price Check Parameters 

August 19, 2008. 

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 August 

19, 2008, the Chicago Board Options 

Exchange, Incorporated ‘‘Exchange’’ or 

(‘‘CBOE’’) 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 Exchange filed the proposal as a 

(‘‘non-controversial’’) proposed rule 

change pursuant to section 

19(b)(3)(A)(iii) of the Act 3 and Rule 

19b–4(f)(6) thereunder.4 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 

Rule 6.53C, Complex Orders on the 

Hybrid System, to codify an automated 

system feature that prevents complex 

order executions from occurring at 

potentially erroneous prices. 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 


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5Rule 8.7(b)(iv)(A) sets forth the bid/ask 

differentials for open outcry trading in an 

individual series, which are as follows: No more 

than $0.25 between the bid and offer for each 

option contract for which the bid is less than $2, 

no more than $0.40 where the bid is at least $2 but 

does not exceed $5, no more than $0.50 where the 

bid is more than $5 but does not exceed $10, no 

more than $0.80 where the bid is more than $10 but 

does not exceed $20, and no more than $1.00 where 

the bid is more than $20. 

6Following from the example above, on an intraday basis the senior official or two Floor Officials 

may determine based on market conditions to grant 

relief by widening the applicable individual series 

or net priced price check parameters (e.g., the 

ranges for the individual series and/or net priced 

price check parameters might be temporarily 

widened to 3 X). 

7 2 X the standard bid/ask differentials would be 

as follows: $0.50 between the bid and offer for each 

option contract for which the bid is less than $2, 

$0.80 where the bid is at least $2 but does not 

exceed $5, $1.00 where the bid is more than $5 but 

does not exceed $10, $1.60 where the bid is more 

than $10 but does not exceed $20, and $2.00 where 

the bid is more than $20. 

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 

Statutory Basis for, the Proposed Rule 

Change 

1.Purpose 

Complex orders that are eligible for 

automatic execution through the CBOE’s 

electronic complex order book (‘‘COB’’) 

may be automatically executed in 

accordance with the provisions of Rule 

6.53C. Complex orders that are not 

eligible to route to COB route to PAR. 

The purpose of the proposed rule 

change is to amend Rule 6.53C to codify 

a description of new complex order 

price check parameter functionality, 

which is a functionality that could be 

activated in certain series of a given 

options class that would prevent an 

automatic execution of a complex order 

from occurring at a potentially 

erroneous price. The complex order 

price check parameter is designed to 

help maintain a fair and orderly market. 

The functionality would prevent 

executions from automatically occurring 

in three types of scenarios: 

Market Width Scenarios 

COB would not automatically execute 

complex orders that are market orders if 

(i) the width between the Exchange’s 

best bid and best offer in any individual 

series leg is not within an acceptable 

price range, or (ii) the width between 

the Exchange’s best net priced bid and 

best net priced offer in the individual 

series legs comprising the complex 

order is not within an acceptable price 

range. The applicable price ranges will 

be determined by the Exchange on an 

individual series leg basis for each 

series comprising the complex order 

and on a net price basis based on the 

sum of each individual series leg of the 

complex order, as applicable, and will 

be announced to the membership via 

Regulatory Circular generally at least 

one day in advance. For purposes of this 

provision, an ‘‘acceptable price range’’

shall be based on no less than 1.5 times 

the corresponding bid/ask differentials 

for the individual series legs as set forth 

in Rule 8.7(b)(iv)(A).5 In addition, the 

Exchange is proposing that the senior 

official in CBOE’s Control Room or two 

Floor Officials may grant intra-day relief 

by widening the acceptable price range. 

Any such intra-day changes will be 

announced to the membership when 

granted. Market orders (in whole or in 

part) that trigger the applicable complex 

order price check parameters and, thus, 

that are not eligible for automatic 

execution, will be routed on a class by 

class basis to PAR, BART, or at the order 

entry firm’s discretion to the order entry 

firm’s booth printer. Thus, if part of a 

market order may be executed within an 

acceptable price range, that part of the 

order will be executed automatically 

and the part of the order that would 

execute at a price outside the acceptable 

price range will be routed as described 

above. 

For illustrative purposes, assume the 

Exchange determines to set a price 

check parameter for the series of a class 

that provides that complex orders 

would not automatically execute if they 

are market orders and (i) the width 

between the Exchange’s best bid and 

best offer in any individual series leg is 

2 × the standard bid/ask differential, or 

(ii) the width between the Exchange’s 

best net bid and best net offer in the 

individual series legs is greater than or 

equal to 1.5 × the standard bid/ask 

differential for the individual series 

legs.6

Example 1: Assume a complex order to 

buy Series A and sell Series B is routed to 

COB. Also assume at that time the best bid 

and offer (‘‘;BBO’’ in Series A is $1.00–$1.60 

(wider than the 2 X series parameter), the 

BBO in Series B is $3.00–$3.10 (within the 

2 X series parameter). Because the bid/ask 

differential in Series A ($0.60) is greater than 

2 X the applicable standard bid/ask 

differential for the series,7 the price check 

parameter will be triggered. The incoming 

complex order will not automatically execute 

in COB and will instead route to PAR, BART 

or the booth. 

Example 2: Assume a complex order to 

buy Series A and sell Series B is routed to 

COB. Also assume at the time the BBO in 

Series A is $1.00–$1.40 (within the 2 X series 

parameter), the BBO in Series B is $2.00 

–$2.60 (within the 2 X series parameter). 

Because the net price bid/ask differential for 

the two series ($1.00) is greater than 1.5 × the 

applicable standard bid/ask differential for 

the series ($0.975), the price check parameter 

will be triggered. The incoming complex 

order will not automatically execute in COB 

and will instead route to PAR, BART or the 

booth. 

Example 3: Assume a complex order to 

buy 50 Series A contracts and sell 50 Series 

B contracts is routed to COB. Also assume at 

that time the BBO in Series A is $1.00–$1.20 

(within the 2 X series parameter) for 100 

contracts, the BBO in Series B is $2.00–$2.20 

(within the 2 X series parameter) for 10 

contracts, and the next available bid in Series 

B is $0.05 for 100 contracts. The incoming 

complex order would execute paying $1.20 

for 10 Series A contracts and collecting $2.00 

for 10 Series B contracts. When the market 

in Series B decrements to $0.05–$2.20, the 

price check parameter would be triggered for 

any one of three reasons: the width of Series 

B is$0.05–$2.20 (wider than the 2 X series 

parameter), the net price width of Series A 

and B is $2.35 (wider than the 2 X net price 

parameter of $1.30), and the net price has 

moved from a credit to debit (discussed 

below). The balance of the incoming complex 

order will route to PAR, BART or the booth. 

Credit-to-Debit (Debit-to-Credit) 

Scenarios 

In classes designated by the Exchange, 

COB would not automatically execute 

market orders that would be executed at 

a net credit (debit) price after receiving 

a partial execution at a net debit (credit) 

price. The remaining balance of any 

such market orders that trigger this 

complex order price check parameters 

will be routed on a class by class basis 

to PAR, BART, or at the order entry 

firm’s discretion to the order entry 

firm’s booth printer. The designated 

classes for which this price check 

parameter is activated will be 

announced to the membership via 

Regulatory Circular. 

Example 3 above illustrates the 

operation of this parameter. In the 

example, the incoming order would 

initially receive an execution for 10 

spreads at a net credit price of $0.80 

each (i.e., the net sale proceeds from 

Series B are larger than the net purchase 

cost from Series A). When the bid in 

Series B decrements to $0.05, the net 

execution price would become a net 

debit price of $1.15 each (i.e., the net 

sale proceeds from Series B are less than 

the net purchase cost from Series A). 

Such an execution would appear to be 

erroneous because normally a person in 


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8As referenced herein, a ‘‘vertical’’ complex order 

is one in which all the component series have the 

same expiration date. 

9A vertical market order that would result in an 

execution at a net credit price (i.e., the net sale 

proceeds from the series being sold are more than 

the net purchase cost from the series being bought) 

but that would normally execute at a net debit price 

(i.e., the net sale proceeds from the series being sold 

are less than the net purchase cost from the series 

being bought) would be a favorable execution for 

the market order and would not trigger this price 

check parameter. 

10 15 U.S.C. 78s(b)(1). 

11 15 U.S.C. 78f(b). 

12 15 U.S.C. 78f(b)(5). 

13 15 U.S.C. 78s(b)(3)(A). 14 17 CFR 240.19b–4(f)(6). 

this scenario would expect to execute its 

entire market order at a net credit price. 

Vertical Scenarios 

In classes designated by the Exchange, 

COB would not automatically execute 

certain vertical complex orders 8 that 

appear to be erroneously priced. This 

functionality is designed to detect and 

prevent executions in limited scenarios 

where (i) a market order would be 

executed at a net debit price when it 

clearly should be executed at a net 

credit price (but not vice versa),9 and (ii) 

a order is entered at a net credit price 

when it clearly should have been 

entered at a net debit price (or vice 

versa). Specifically, a market order that 

would trade at a net (debit) price or a 

complex order priced at net credit 

(debit) price that consists of at least two 

series legs would be automatically 

rejected by COB if the complex order 

would result in an execution to: 

• Buy (sell) a number of call option 

contracts and sell (buy) the same 

number or applicable ratio (as 

determined by the Exchange on a class 

by class basis) of call option contracts in 

a series with the same underlying 

security and expiration date but a higher 

exercise price; or 

• Buy (sell) a number of put option 

contracts and sell (buy) the same 

number or applicable ratio (as 

determined by the Exchange on a class 

by class basis) of put option contracts in 

a series with the same underlying 

security and expiration date but a lower 

exercise price. 

As with the other price check 

parameters, the designated classes for 

which this parameter is activated, as 

well as any applicable ratio, will be 

announced to the membership via 

Regulatory Circular. If these conditions 

exist when an order is routed to COB, 

the complex order will be rejected. To 

the extent the parameters are triggered 

once an order is resting in COB or after 

an incoming order receives a partial 

execution, such complex orders will be 

routed on a class by class basis to PAR, 

BART, or at the order entry firm’s 

discretion to the order entry firm’s 

booth printer. The following examples 

illustrate this price check parameter: 

Example 1: Assume a complex order to 

buy 50 Jan 45 XYZ calls and sell 50 Jan 50 

XYZ calls is entered at a net credit price (i.e., 

the net sale proceeds from the Jan 50 calls 

are larger than the net purchase cost from the 

Jan 45 calls). Such an order would appear to 

be erroneously priced as a net credit—it 

should instead be a net debit—because 

normally a person would expect that the Jan 

50 calls would not cost more than the Jan 45 

calls. 

Example 2: Assume a butterfly spread to 

buy 50 Jan 45 XYZ calls, sell 100 Jan 50 XYZ 

calls and buy 50 Jan 55 XYZ calls is entered 

at a net credit price (i.e., the net sale 

proceeds from the Jan 50 calls are more than 

the net purchase cost from the Jan 45 and 55 

calls). Such an order would appear to be 

erroneously priced as a net credit—it should 

instead be a net debit—because normally a 

person would expect that selling the middle 

50 strike would result in less than the cost 

of buying the upper 55 and lower 45 strikes. 

Example 3: Assume a market order to buy 

50 Jan 45 XYZ calls and sell 50 Jan 40 XYZ 

calls is entered. Also assume that the Jan 45 

XYZ calls are quoted $4.00–$4.10 for 10 

contracts and the next available offer is $4.30 

for 100 contracts, and that the Jan 40 XYZ 

calls are quoted $4.50–$4.60 for 10 contracts 

and the next available bid is $4.20 for 100 

contracts. The incoming market order would 

receive an execution for 10 spreads at a net 

credit price of $0.40 each (i.e., the net sale 

proceeds from the Jan 40 Series are larger 

than the net purchase cost from the Jan 45 

Series). When the series decrement, the net 

execution price would become a net debit 

price of $0.10 each (i.e., the net sale proceeds 

from the Jan 40 Series are less than the net 

purchase cost from the Jan 45 Series). Such 

an execution would appear to be erroneous 

because normally a person in this scenario 

would expect to execute the vertical spread 

at a net credit price. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the Act 10

and the rules and regulations under the 

Act applicable to national securities 

exchanges and, in particular, the 

requirements of section 6(b) of the 

Act.11 Specifically, the Exchange 

believes the proposed rule change is 

consistent with the section 6(b)(5) 12

requirements that the rules of an 

exchange be designed to promote just 

and equitable principles of trade, to 

prevent fraudulent and manipulative 

acts, to remove impediments to and to 

perfect the mechanism for a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest. The 

proposed rule change will contribute to 

the maintenance of fair and orderly 

markets because it will provide an 

automated process for preventing 

potentially erroneous executions in 

complex orders from occurring. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

CBOE 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 

The Exchange neither solicited nor 

received comments on the proposal. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing rule does not (i) 

significantly affect the protection of 

investors or the public interest; (ii) 

impose any significant burden on 

competition; and (iii) become operative 

for 30 days from the date on which it 

was filed, or such shorter time as the 

Commission may designate if consistent 

with the protection of investors and the 

public interest, provided that the selfregulatory organization has given the 

Commission written notice of its intent 

to file 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 proposed rule change 

has become effective pursuant to section 

19(b)(3)(A) of the Act 13 and Rule 19b–

4(f)(6) thereunder.14 At any time within 

60 days of the filing of such 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–CBOE–2008–83 on the 

subject line. 


sroberts on PROD1PC76 with NOTICES
Federal Register / Vol. 73, No. 166 / Tuesday, August 26, 2008 / Notices 50379 

15 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3A Firm ID is a 1–4 character identification code 

(letters and /or numbers). Each CBOE member firm 

may establish its own unique Firm ID. 

4 15 U.S.C. 78s(b)(1). 

5 15 U.S.C. 78f(b). 

6 15 U.S.C. 78f(b)(5). 

7 15 U.S.C. 78s(b)(3)(A). 

8 17 CFR 240.19b–4(f)(6). 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–CBOE–2008–83. 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 inspection and copying in 

the Commission’s Public Reference 

Room, 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–CBOE–

2008–83 and should be submitted on or 

before September 16, 2008. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Florence E. Harmon, 

Acting Secretary. 

[FR Doc. E8–19706 Filed 8–25–08; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–58394; File No. SR–CBOE–

2008–85] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change Adopting a New Order 

Type 

August 20, 2008. 

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 August 

19, 2008, the Chicago Board Options 

Exchange, Incorporated (the ‘‘Exchange’’

or ‘‘CBOE’’) 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 

substantially 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 modify 

Rule 6.53 (Certain Types of Orders 

Defined) to allow for the submission of 

attributable orders. The text of the 

proposed rule change is available on the 

Exchange’s Web site (http:// 

www.cboe.org/legal), at the Office of the 

Secretary, CBOE 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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to modify 

Rule 6.53 (Certain Types of Orders 

Defined) to allow for the submission of 

attributable orders.3 These orders allow 

users to voluntarily display their firm 

IDs on the orders. The NASDAQ 

Options Market, LLC (‘‘NOM’’) currently 

allows its participants to submit 

attributable orders (See NOM Chapter 

VI, Section (1)(d)(1)). As proposed, the 

Exchange may limit the systems/ 

processes for which attributable orders 

will be available. For example, the 

attributable order-type may initially 

only be available in connection with 

certain Exchange auction processes like 

the Hybrid Agency Liaison system 

which ‘‘flashes’’ marketable orders for 

price improvement executions before 

those orders are routed to another 

market center pursuant to the Options 

Linkage Plan. This proposal is 

responsive to requests by Exchange 

users who believe that enhanced 

executions may be obtained if firm ID 

information is allowed on orders (on a 

voluntary basis). 

2. Statutory Basis 

Since this proposal allows for greater 

customization by providing users with 

an additional order type, the Exchange 

believes that the proposal is consistent 

with the Act 4 and the rules and 

regulations thereunder and, in 

particular, the requirements of Section 

6(b) of the Act.5 Specifically, the 

Exchange believes the proposal is 

consistent with the Section 6(b)(5) 6

requirements that the rules of an 

exchange be designed to promote just 

and equitable principles of trade and to 

remove impediments to and to perfect 

the mechanism for a free and open 

market and a national market system. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

CBOE 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 

The Exchange neither solicited nor 

received comments on the proposal. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The proposed rule change is filed for 

immediate effectiveness pursuant to 

Section 19(b)(3)(A) 7 of the Act and Rule 

19b–4(f)(6) 8 thereunder because it 

effects a change that (i) Does not 

significantly affect the protection of 

investors or the public interest; (ii) does 

not impose any significant burden on 

competition; and (iii) by its terms, does 

not become operative for 30 days after 

the date of the filing, or such shorter 

time as the Commission may designate 

if consistent with the protection of 


sroberts on PROD1PC76 with NOTICES