Federal Register / Vol. 74, No. 117 / Friday, June 19, 2009 / Notices 29251 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4 In Amendment No. 1, the Exchange corrected a 

typographical error that occurred on the cover sheet 

that accompanied the Exchange’s submission on 

Form 19b–4. Specifically, the Exchange conformed 

its categorization of the statutory provision 

applicable to the proposed rule change (i.e., Section 

19(b)(3)(A) instead of Section 19(b)(2) of the Act) to 

make the cover sheet consistent with the text of the 

Form 19b–4. 

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

6 15 U.S.C. 78f(b)(4). 

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

8 17 CFR 240.19b–4(f)(2). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60102; File No. SR– 

NYSEArca-2009–50] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change, as Modified 

by Amendment No. 1, by NYSE Arca, 

Inc. Implementing Schedule of Fees 

and Charges for Exchange Services by 

adding a Ratio Threshold Fee 

June 11, 2009. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on June 1, 

2009, NYSE Arca, Inc. (‘‘NYSE Arca’’ or 

the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the self-regulatory 

organization. On June 9, 2009, the 

Exchange filed Amendment No. 1 to the 

proposed rule change.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 its 

Schedule of Fees and Charges for 

Exchange Services (‘‘Schedule’’) by 

adding a Ratio Threshold Fee. While 

changes to the Schedule pursuant to this 

proposal will be effective upon filing, 

the proposed fee will become operative 

on June 1, 2009. The text of the 

proposed rule change is attached as Ex.5 

to the 19b–4 form. A copy of this filing 

is available on the Exchange’s Web site 

at http://www.nyse.com, at the 

Exchange’s principal office 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 adding a 

Ratio Threshold Fee to its Fee Schedule. 

The proposed Ratio Threshold Fee will 

be charged to OTP Holders based on the 

number of orders entered compared to 

the number of executions received in a 

calendar month. The fee will be 

assessed as follows: 

Monthly order to execution ratio Monthly 

charge 

Between 10,000 and 14,999 to 1 $5,000 

Between 15,000 and 19,999 to 1 10,000 

Between 20,000 and 24,999 to 1 20,000 

25,000 to 1 and greater ................ 35,000 

This fee shall not apply to orders that 

improve the Exchange’s prevailing best 

bid-offer (BBO) market at the time the 

orders are received. 

OTP Holders with order to execution 

ratios of 10,000 to 1 or greater have the 

potential residual effect of exhausting 

system resources, bandwidth, and 

capacity. Such order to execution ratios 

may, in turn, create latency and impact 

other OTP Holders ability to receive 

timely executions. Recognizing that 

orders and executions often occur in 

large numbers, the purpose of this fee is 

to focus on activity that is truly 

disproportionate while fairly allocating 

costs among members. The proposed fee 

has multiple thresholds and is greater at 

higher order to execution ratios because 

the potential impact on exchange 

systems, bandwidth and capacity 

becomes greater with increased order to 

execution ratios. 

The new Ratio Threshold Fee will 

become effective on June 1, 2009. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the provisions of Section 6 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),5 in general, and Section 6(b)(4) 

of the Act,6 in particular, in that it is 

designed to provide for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members and 

other persons using its facilities. Under 

this proposal, all similarly situated 

members of NYSE Arca will be charged 

the same reasonable dues, fees and other 

charges. 

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 

The foregoing rule change is effective 

upon filing pursuant to Section 

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

subparagraph (f)(2) of Rule 19b–4 8

thereunder, because it establishes a due, 

fee, or other charge imposed by NYSE 

Arca. 

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–NYSEArca-2009–50 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. 

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29252 Federal Register / Vol. 74, No. 117 / Friday, June 19, 2009 / Notices 

9 17 CFR 200.30–3(a)(12). 

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 options entered into, and routed by, the Phlx XL 

II system. 

4An SQT is an Exchange Registered Options 

Trader (‘‘ROT’’) who has received permission from 

the Exchange to generate and submit option 

quotations electronically through AUTOM in 

eligible options to which such SQT is assigned. An 

SQT may only submit such quotations while such 

SQT is physically present on the floor of the 

Exchange. See Exchange Rule 1014(b)(ii)(A). 

5An RSQT is an ROT that is a member or member 

organization with no physical trading floor 

presence who has received permission from the 

Exchange to generate and submit option quotations 

electronically through AUTOM in eligible options 

to which such RSQT has been assigned. An RSQT 

may only submit such quotations electronically 

from off the floor of the Exchange. See Exchange 

Rule 1014(b)(ii)(B). 

6See supra note 3. 

7See Exhibit 3 to the proposed rule change. See 

also infra note 9 

8See Securities Exchange Act Release No. 59995 

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

Phlx–2009–32). 

All submissions should refer to File 

Number SR–NYSEArca-2009–50. 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, 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 will also be available 

for inspection and copying at the 

principal office of the self-regulatory 

organization. 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-2009–50 and should be 

submitted on or before July 10, 2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–14352 Filed 6–18–09; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–60103; File No. SR–Phlx– 

2009–47] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX, Inc.; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to 

Order Routing Fees 

June 11, 2009. 

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 June 5, 

2009, NASDAQ OMX PHLX, Inc. 

(‘‘Phlx’’ or ‘‘Exchange’’) 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 adopt fees 

governing pricing for Phlx members 

using the Phlx XL II system,3 for routing 

standardized equity and index options 

to away markets for execution. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http:// 

nasdaqomxphlx.cchwallstreet.com/ 

NASDAQOMXPHLX/Filings/, 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 purpose of the proposed rule 

change is to adopt fees for executions of 

options orders entered into the 

Exchange’s enhanced electronic trading 

platform for options, Phlx XL II but 

routed to away markets. The Exchange 

proposes a routing fee based upon the 

cost to the Exchange of executing such 

orders at those markets. In order to 

reflect the Exchange’s cost of execution 

at away markets, the fees will be 

separated as applicable, depending on 

the away market’s fee schedule, by type 

of option (penny pilot, equity/nonpenny pilot, ETF or HLDS/non-penny 

pilot, and Index) and vary depending 

upon whether the order is being routed 

for a customer, a member firm, a market 

maker (which includes a specialist, a 

Registered Options Trader, a Streaming 

Quote Trader (‘‘SQT’’),4 and a Remote 

Streaming Quote Trader (‘‘RSQT’’)),5 or 

by a Floor Broker. Initially, the Phlx XL 

II system will only route customer 

orders.6 The Table reflects that routing 

fees are currently not applicable to firms 

and market makers, since their order 

will not be routed by the Phlx XL II 

system. In the event that the Exchange 

determines to route firm and market 

maker orders, membership will be 

notified by an Options Trader Alert 

(‘‘OTA’’) of any applicable routing fees, 

and the Table will be updated to reflect 

such fees. 

The Exchange proposes to pass 

through to Exchange members the actual 

transaction fees (including surcharges/ 

license fees if applicable) assessed by 

away markets plus the clearing fees for 

the execution of orders routed from the 

Phlx XL II system. The Exchange has 

collected and organized in table format 

the fees to be assessed for routing to 

each destination exchange.7

The Exchange recently 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.8 The 

sole use of NOS by the Phlx XL II 

system will be to route orders in options 

listed and open for trading on the Phlx 

XL II system to destination markets. A 

particular destination market would 

charge NOS their applicable transaction 

fees, which would then be passed 

through to Phlx, and ultimately to the 

initiating member under this proposal. 

Similarly, clearing fees charged to NOS 

by the Options Clearing Corporation 

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