Document ID: SEC-2008-1089-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: American Stock Exchange LLC
Posted Date: 2008-08-07T04:00Z

[Federal Register: August 7, 2008 (Volume 73, Number 153)]
[Notices]               
[Page 46099-46104]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07au08-110]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58272; File No. SR-Amex-2008-61]

 
Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating to the Listing and Trading of Broad-Based Index Binary Options

July 31, 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 July 29, 2008, the American Stock Exchange LLC (the ``Amex'' or the 
``Exchange'') 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 substantially by the Exchange. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to list and trade binary options based on 
certain broad-based indexes.
    The text of the proposed rule change is available at the Amex's 
principal office, the Commission's Public Reference Room, and http://
www.amex.com.

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 Amex 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 this proposed rule change is to enable the listing 
and trading on the Exchange of binary options on certain broad-based

[[Page 46100]]

indexes.\3\ Currently, the Amex lists and trades a particular binary 
option called a Fixed Return Option\SM\ (``FRO'' or ``Fixed Return 
Option'') on underlying individual stocks and exchange-traded fund 
(``ETF'') shares.\4\ FROs are not currently listed and traded on 
securities indexes.
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    \3\ A ``broad stock index group'' (referred to as a broad-based 
index) is defined in Amex Rule 900C(b)(1) as a stock index group 
relating to a stock index which reflects representative stock market 
values or prices of a broad segment of the stock market.
    \4\ See Securities Exchange Act Release No. 56251 (August 14, 
2007), 72 FR 46523 (August 20, 2007) (order approving File No. SR-
Amex-2004-27).
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    Binary options will have an exercise settlement amount that is 
equal to the applicable exercise settlement value multiplied by the 
applicable contract multiplier. The exercise settlement value will be 
an amount determined by the Exchange on a class-by-class basis and will 
be greater or equal to $10 and less than or equal to $1,000. The 
contract multiplier will also be established on a class-by-class basis 
and will be at least 1. Binary options are automatically exercised if 
the settlement value of the underlying index equals, exceeds, or is 
less than the exercise price, depending on the type of the option 
(i.e., call or put). Binary options will be based on the same framework 
as existing standardized options that are traded on the Amex and the 
other options exchanges; however, the payout of a binary option is an 
amount that is contingent upon the occurrence of the option being ``in-
'' or ``at-the-money'' versus the degree to which the option is ``in-
the-money.'' As a result, the payout at expiration will be an ``all-or-
nothing'' occurrence.
Characteristics of Binary Options
    The proposed binary options will be European-style and will have an 
exercise settlement amount that is based on the exercise price in 
relation to the settlement value of the underlying broad-based index at 
expiration. After a particular binary option class has been approved 
for listing and trading on the Exchange, the Exchange may open for 
trading series of options on that class. In order to afford investors 
maximum flexibility, binary option series may expire from one day up to 
36 months from the time that they are listed. Binary options will be 
quoted based on the existing strike intervals utilized for traditional 
index options (e.g., $2.50 per contract if the index is below 200 and 
$5.00 per contract is the index is above 200) with minimum price 
variations, established by class, to be no less than $0.01.
    At expiration, the option will pay out an exercise settlement 
amount that is equal to the exercise settlement value multiplied by the 
contract multiplier. Unlike traditional index options, the value of the 
payout is not affected by the magnitude of the difference between the 
underlying index and the exercise price. Rather, the payout will be a 
set amount contingent upon whether the settlement value of the 
underlying index is: (1) Equal to or above the exercise price at 
expiration for call binary options; or (2) below the exercise price at 
expiration for put binary options.
    The OTC Market. Binary options have been traded in the over-the-
counter (``OTC'') market for many years. However, OTC binary options 
have several disadvantages. OTC binary options are typically offered by 
an institution on a non-fungible basis so the customer can only 
purchase or close out the option from the particular institution that 
is issuing the option. As a result, OTC binary options lack 
transparency and a trading market (liquidity). The Amex's proposal is 
intended to provide the market for binary options with a standardized 
product without the credit risk of an individual issuer. By providing a 
listed and standardized market for a class of binary options, the 
Exchange seeks to attract investors who desire a binary option but at 
the same time prefer the certainty and safeguards of a regulated and 
standardized marketplace. Binary options are designed to be a 
simplified version of traditional, exchange-traded options and to 
provide investors with a simple product with an easy to understand risk 
profile.
    Simplicity. Binary options are easier to understand and utilize 
than traditional options because of the manner of their payout (i.e., a 
set exercise settlement amount if the underlying closes at, below, or 
above the exercise price) and because they are cash-settled. A 
significant benefit of a binary option is that the buyer and writer of 
the option know the expected return at the time of purchase if the 
underlying index performs as expected. In contrast, the ``traditional'' 
option does not typically have a known return at the time of purchase, 
i.e., the return cannot be accurately determined until the option is 
nearing expiration due to price movements. In addition, because the 
return on the binary option is a set amount, a buyer of a binary option 
does not need to determine the absolute magnitude of the underlying 
index's price movement relative to the exercise price, as is the case 
with traditional options.
    Risk Transparency. In addition, unlike traditional options where a 
writer has unlimited risk, the maximum obligation in connection with a 
binary option is known when the contract is written. And, unlike with 
an OTC binary option, counter-party credit risk is significantly 
reduced through the issuance and guarantee of the contracts by The 
Options Clearing Corporation (``OCC'').
    Liquidity. As an exchange-traded option, binary options will have 
the advantage of liquidity provided by Amex specialists, registered 
options traders (``ROTs''), supplemental registered options traders 
(``SROTs''), and remote registered options traders (``RROTs''), and, 
therefore, spreads should be tighter than exists in the OTC market. 
Further, the Exchange believes that standardization will enable more 
interested parties to become market participants. Therefore, the 
Exchange believes that the proposal offers a more transparent and level 
playing field than the OTC market.
Discussion of Particular Rules
    Definitions. Proposed Rule 900BIN includes new proposed definitions 
applicable to binary options set forth in Rule 900BIN(b). In 
particular, the terms ``binary option,'' ``exercise price,'' ``exercise 
settlement amount,'' ``contract multiplier,'' and ``reporting 
authority'' are proposed to be defined. In addition, the term ``call 
binary option'' is proposed to be defined to mean an option that 
returns an exercise settlement amount if the settlement value of the 
underlying broad-based index is at or above the exercise price at 
expiration (i.e., in- or at-the-money). Also, the term ``put binary 
option'' is defined to mean an option that returns an exercise 
settlement amount if the settlement value of the underlying broad-based 
index is below the exercise price at expiration (i.e., in-the-money).
    Further, the term ``settlement value'' is defined to mean the value 
of the underlying broad-based index that is used to determine whether a 
binary option is in-, at-, or out-of-the-money. For binary options on a 
broad-based index on which traditional options on the same broad-based 
index are A.M.-settled, the ``settlement value'' is the reported 
opening level of such index as derived from the prices of the 
underlying securities on such day and as reported by the reporting 
authority for the index. For binary options on a broad-based index on 
which traditional options on the same broad-based index are P.M.-
settled, the ``settlement value'' is the reported closing level of such 
index as derived from the prices of the

[[Page 46101]]

underlying securities on such day and as reported by the reporting 
authority for the index.
    Designation of Binary Option Contracts and Maintenance Listing 
Standards. Proposed Rule 901BIN (Designation of Binary Options 
Contracts) provides that the Exchange may from time to time approve for 
listing and trading on the Exchange binary options on a broad-based 
index which has been selected in accordance with Commentary.02 to Rule 
901C. Binary options will be a separate class from other options 
overlying the same broad-based index. Proposed Rule 915BIN also 
provides that only binary option contracts approved by the Exchange and 
currently open for trading on the Exchange may be purchased or sold on 
the Exchange. Binary options dealt in on the Exchange will be 
designated as to expiration date, exercise price, exercise settlement 
value, contract multiplier, and underlying index.
    Binary options on broad-based indexes for which traditional options 
on the same broad-based index are A.M.-settled will be A.M.-settled, 
and binary options on broad-based indexes for which traditional options 
on the same broad-based index are P.M.-settled will be P.M.-settled. To 
the extent possible, the Exchange will recognize and treat binary 
options like existing standardized options. Standardized systems for 
listing, trading, transmitting, clearing, and settling options, 
including systems used by the OCC, will be employed in connection with 
binary options. In addition, binary options will have a symbology based 
on the current system, so that symbols are created that represent the 
expiration date, exercise price, exercise settlement value, and 
underlying index.
    Proposed Rule 901BIN provides that after a particular binary option 
has been approved for listing and trading on the Exchange, the Exchange 
may open for trading series of options on that class. Binary option 
series may be designated to expire from one day up to 36 months from 
the time that they are listed. The Exchange may add new series of 
options of the same class as provided for in Rule 903C and the related 
Commentaries. Additional series of the same binary option class may be 
opened for trading on the Exchange when the Exchange deems it necessary 
to maintain an orderly market or to meet customer demand. The opening 
of a new series of binary options on the Exchange will not affect any 
other series of options of the same class previously opened. Proposed 
Rule 915BIN (Maintenance Listing Standards) provides that the 
maintenance listing standards set forth in Rule 901C and related 
Commentaries will be applicable to binary options on broad-based 
indexes.
    Margin Requirements. The Exchange is proposing to add Rule 462(d)11 
to include requirements applicable to binary options. The proposed 
margin requirements are substantially similar to the current margin 
requirements applicable to FROs.\5\
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    \5\ The Exchange recently filed a proposed rule change to 
slightly modify its margin requirements relating to FROs. Once 
approved by the Commission, the FRO margin requirements will be 
identical to the proposed margin rules for binary options. See File 
No. SR-Amex-2008-46.
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    For a Margin Account, no binary option carried for a customer shall 
be considered of any value for purposes of computing the margin 
required in the account of such customer. The initial and maintenance 
margin required on any binary option carried long in a customer's 
account is 100% of the purchase price of such binary option (i.e., the 
premium). In connection with short positions in binary options, the 
customer margin required is the exercise settlement amount. As for 
spreads, no margin is required on a binary call option (put option) 
carried short in a customer's account that is offset by a long binary 
call option (put option) for the same underlying security or instrument 
that expires at the same time and has an exercise price that is less 
than (greater than) the exercise price of the short call (put). The 
long call (put) must be paid for in full. As for a straddle/
combination, when a binary call option is carried short in a customer's 
account and there is also carried a short binary put option that 
expires at the same time and has an exercise price that is less than or 
equal to the exercise price of the short call, the initial and 
maintenance margin required is the exercise settlement amount 
applicable to one contract.
    For a cash account, a binary option carried short in a customer's 
account will be deemed a covered position, and eligible for the cash 
account, if either one of the following is held in the account at the 
time the option is written or is received into the account promptly 
thereafter: (i) Cash or cash equivalents equal to 100% of the exercise 
settlement amount; (ii) a long binary option of the same type (put or 
call) for the same underlying security or instrument that is paid for 
in full and expires at the same time, and has an exercise price that is 
less than the exercise price of the short in the case of a call or 
greater than the exercise price of the short in the case of a put; or 
(iii) an escrow agreement. The escrow agreement must certify that the 
bank holds for the account of the customer as security for the 
agreement (A) cash, (B) cash equivalents, (C) one or more qualified 
equity securities, or (D) a combination thereof having an aggregate 
market value of not less than 100% of the exercise settlement amount, 
and that the bank will promptly pay the member organization the cash 
settlement amount in the event the account is assigned an exercise 
notice.
    The Exchange believes that these proposed levels are appropriate 
because risk exposure is limited with binary options and the proposed 
customer initial and maintenance margin is equal to the maximum risk 
exposure.\6\
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    \6\ Pursuant to Amex Rule 462(d)2.(F), the Exchange has the 
ability to determine at any time to impose higher margin 
requirements than those described above in respect of any binary 
option position when it deems such higher margin requirements are 
appropriate.
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    Limitations of Liability of the Exchange. The Exchange proposes in 
Rule 902BIN to apply the limitation of liability provision set forth in 
Rule 902C to binary options.
    Position Limits, Position Reporting Requirements, No Exercise 
Limits, and Other Restrictions. The Exchange is proposing a two-pronged 
approach to determine position limits for binary options. In 
determining compliance with Rule 904C, the Exchange proposes a fixed 
position limit of 15,000 contracts for binary options on a broad-based 
index for which traditional options on the same broad-based index have 
no position limit, provided that the exercise settlement amount is 
$10,000. For binary options that have an exercise settlement amount 
that is not equal to $10,000, the position limit will be 15,000 times 
the ratio of 10,000 to the exercise settlement amount (e.g., if the 
binary option exercise settlement amount is $1,000, then the position 
limit is 150,000 contracts. If the binary option exercise settlement 
amount is $12,000, then the position limit is 12,500 contracts).
    The Exchange proposes a formulaic position limit for binary options 
on a broad-based index for which traditional options on the same broad-
based index have a position limit. The formulaic position limit will be 
calculated in accordance with the following methodology: (1) Determine 
the Market Capitalization of the S&P 500 Index; (2) determine the 
Market Capitalization of the broad-based index underlying the binary 
option; (3) calculate the Market Capitalization Ratio of the broad-
based index underlying the binary option to the Market Capitalization 
of the S&P 500 Index. The position limit for binary options subject to 
a formulaic limit with

[[Page 46102]]

an exercise settlement amount of $10,000 will be: (i) 10,000 contracts 
if the Market Capitalization Ratio is greater than or equal to 0.50; 
(ii) 5,000 contracts if the Market Capitalization Ratio is less than 
0.50 but greater than or equal to 0.25; (iii) 2,500 contracts if the 
Market Capitalization Ratio is less than 0.25 but greater than or equal 
to 0.10. The Exchange will seek Commission approval prior to 
establishing position limits for binary options on broad-based indexes 
that have a Market Capitalization Ratio that is less then 0.10. For 
binary options that have an exercise settlement amount that is not 
equal to $10,000, the position limit will be the ratio of 10,000 to the 
exercise settlement amount multiplied by the applicable formulaic 
limit.
    Proposed Rule 904BIN also provides that positions in binary options 
on the same broad-based index and/or an ETF tracking that broad-based 
index will be aggregated, irrespective of whether the positions have 
different exercise settlement amounts. In determining compliance with 
the position limits set forth in proposed Rule 904BIN, binary options 
will not be aggregated with non-binary option contracts on the same or 
similar underlying security or broad-based index. In addition, binary 
options on broad-based indexes will not be aggregated with non-binary 
option contracts and/or Fixed Return Options on an underlying stock or 
stocks included within such broad-based index, and binary options on 
one broad-based index will not be aggregated with binary options on any 
other broad-based index. For purposes of the position limits 
established under proposed Rule 904BIN, long positions in put binary 
options and short positions in call binary options will be considered 
to be on the same side of the market; and short positions in put binary 
options and long positions in call binary options will be considered to 
be on the same side of the market.
    Binary options will not be subject to the hedge exemption to the 
standard position limits found in Rule 904. Under proposed Rule 904BIN, 
the following qualified hedge exemption strategies and positions will 
be exempt from the established binary option position limits: (1) A 
binary option position ``hedged'' or ``covered'' by an appropriate 
amount of cash to meet the settlement obligation (e.g., $1,000 for a 
binary option with an exercise settlement amount of $1,000), (2) a 
binary option position ``hedged'' or ``covered'' by a sufficient amount 
of a related or similar security to meet the settlement obligation, or 
(3) a binary option position ``hedged'' or ``covered'' by a traditional 
option covering the same underlying broad-based index sufficient to 
meet the settlement obligation. Binary options will not be subject to 
exercise limits due to the fact that they are European-style options 
and are automatically exercised at expiration if the settlement value 
of the underlying index is equal to or greater than the exercise price 
of a call binary option or less than the exercise price in the case of 
a put binary option. Proposed Rule 905BIN confirms this.
    Proposed Rule 906BIN (Reporting of Positions) provides that 
positions in binary options shall be reported pursuant to Rule 906C 
(meaning the minimum position in the account which must be reported is 
200 or more binary options). In computing reportable binary options 
positions under Rule 906C, positions in binary options will be reported 
to the Exchange when an account establishes an aggregate same side of 
the market position of 200 or more binary options, with the aggregation 
of position in accordance with Rule 904BIN. The Exchange believes that 
the reporting requirements and the surveillance procedures for hedged 
positions will enable the Exchange to closely monitor sizable positions 
and corresponding hedges.
    Proposed Rule 909BIN provides that binary options are subject to 
Rule 909C except for Commentaries .01 and.02 to Rule 909C because such 
Commentaries are relevant only for options that are settled by delivery 
of an underlying security.
    Determination of Exercise Price. The Exchange proposes in Rule 
910BIN to provide that the determination of whether binary options are 
in-, at-, or out-of-the-money at expiration will be a function of the 
settlement value of the underlying broad-based index in relation to the 
type of binary option (i.e., put or call) and the exercise price.
    Trading Mechanics for Binary Options. The Exchange intends to trade 
binary options similar to the manner in which it trades other index 
options. Under the proposed rules, trading in binary options will be 
conducted in the following manner:
     Trading Rotations, Halts, and Suspension of Trading 
(Proposed Rule 918BIN): The trading rotation, halt, and suspension 
procedures contained in existing Rule 918C will be applicable to binary 
options.
     Premium Bids and Offers; Minimum Increments; Priority and 
Allocation (Proposed Rule 951BIN): All bids and offers will be deemed 
to be for one contract unless a specific number of option contracts is 
expressed in the bid or offer. A bid or offer for more than one option 
contract which is not made all-or-none will be deemed to be for that 
amount or any lesser number of options contracts. An all-or-none bid or 
offer will be deemed to be made only for the amount stated. All bids 
and offers made for binary option contracts related to an underlying 
index will be governed by Rules 951--ANTE (Premium Bids and Offers), 
Rule 951C (Minimum Price Variation), Rule 954 (Units of Trading), Rule 
935--ANTE (Allocation of Executed Contracts), and Commentary .04 to 
Rule 950--ANTE(l) (Allocation of Executed Contracts Outside of ANTE), 
as applicable. The minimum price variation will be established on a 
class-by-class basis by the Exchange and will not be less than $0.01. 
The rules of priority and order allocation procedures set forth in 
Rules 935--ANTE and Commentary .04 to Rule 950--ANTE(l) will apply to 
binary options.
     Maximum Bid-Ask Differentials; Market-Maker Appointments 
and Obligations (Proposed Rule 952BIN): Proposed Rule 952BIN provides 
that specialists, ROTs, SROTs, and RROTs are expected to bid and offer 
so as to create differences of no more than 25% of the designated 
exercise settlement value between the bid and offer for each binary 
option contract or $5.00, whichever amount is wider, except during the 
last trading day prior to the expiration, where the maximum permissible 
price differential for binary options may be 50% or $5.00, whichever 
amount is wider.
    The allocation of securities to specialists and appointment of 
ROTs, SROTs, and RROTs in connection with binary option classes will be 
the same as the appointments for other options, as set out in existing 
Rule 27 (Specialist) and Rule 958--ANTE (ROTs, SROTs, and RROTs).
     Automatic Exercise of Binary Option Contracts (Proposed 
Rule 980BIN): Proposed Rule 980BIN provides that binary options will be 
automatically exercised at expiration if the settlement value of the 
underlying broad-based index is equal to or greater than the exercise 
price of a call binary option or less than the exercise price in the 
case of a put binary option. Rules 981 and 982 will be inapplicable to 
binary options.
     FLEX Trading Rules (Proposed Rule 981BIN): Proposed Rule 
981BIN provides that binary options will be eligible for trading as 
Flexible Exchange Options as provided for in Rules 900G et al. For 
purposes of Rule 903G, the applicable exercise settlement amount will 
be designated by the parties to the contract, the parties to the 
contract cannot designate an Exercise Style other

[[Page 46103]]

than European-style, and the term ``index multiplier'' as used in those 
rules will refer to the ``contract multiplier'' as defined in Rule 
900BIN. Rule 906G will not apply to binary options and the position 
limit methodology set forth in Rule 904BIN shall apply. Rule 904G(g), 
regarding minimum quote width, will not apply to binary options and the 
minimum quote width set forth in Rule 952BIN will apply.
OCC Rule Filing; Options Disclosure Document
    The OCC has amended its By-Laws and Rules to accommodate the 
listing and trading of binary options.\7\ The Exchange is also aware 
that OCC filed revisions to the Options Disclosure Document (``ODD'') 
in order to accommodate binary options. The Commission recently 
approved the ODD revisions.\8\
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    \7\ See Securities Exchange Act Release No. 56875 (November 30, 
2007), 72 FR 69274 (December 7, 2007) (File No. SR-OCC-2007-08).
    \8\ See Securities Exchange Act Release No. 58043 (June 26, 
2008), 73 FR 38260 (July 3, 2008) (File No. SR-ODD-2008-02).
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Systems Capacity
    The Amex believes the Exchange and the Options Price Reporting 
Authority have the necessary systems capacity to handle the additional 
traffic associated with the listing and trading of binary options. The 
Exchange does not anticipate that there will be any additional quote 
mitigation strategy necessary to accommodate the trading of binary 
options.
Surveillance
    The Exchange represents that it has an adequate surveillance 
program in place for the trading of broad-based index binary options 
and intends to largely apply its existing surveillance program for 
index options and FROs to the trading of broad-based index binary 
options series.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the 
Act,\9\ in general, and furthers the objectives of Section 6(b)(5),\10\ 
in particular, in that it is designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, to foster cooperation and coordination with 
persons engaged in regulating, clearing, settling, processing 
information with respect to, and facilitating transaction in 
securities, and, in general, to protect investors and the public 
interest. The Exchange believes that the proposal will provide 
investors and the marketplace with additional investment opportunities 
as well as risk management tools as a result of the introduction of 
binary options on the Exchange.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(5).
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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.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    The Exchange did not receive any written comments on the proposed 
rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The Amex has designated the proposed rule change as one that: (1) 
Does not significantly affect the protection of investors or the public 
interest; (2) does not impose any significant burden on competition; 
and (3) does not become operative for 30 days from the date of filing, 
or such shorter time as the Commission may designate if consistent with 
the protection of investors and the public interest. In addition, as 
required under Rule 19b-4(f)(6)(iii),\11\ the Amex provided the 
Commission with written notice of its intention to file the proposed 
rule change, along with a brief description of the text of the proposed 
rule change, at least five business days prior to filing the proposal 
with the Commission. Therefore, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act \12\ and Rule 19b-
4(f)(6) thereunder.\13\
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    \11\ 17 CFR 240.19b-4(f)(6)(iii).
    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f)(6).
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    The Amex has requested that the Commission waive the 30-day 
operative delay. The Commission hereby grants the Amex's request.\14\ 
The Amex's proposal is substantially similar to a CBOE proposal that 
the Commission approved \15\ and does not appear to raise any novel or 
significant issues. Therefore, the Commission believes that waiving the 
30-day operative delay is consistent with the protection of investors 
and the public interest and designates the proposed rule change as 
operative upon filing.
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    \14\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposal's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
    \15\ See Securities Exchange Act Release No. 57850 (May 22, 
2008), 73 FR 31169 (May 30, 2008) (order approving File No. SR-CBOE-
2006-105).
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    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 rule-comments@sec.gov. Please include 
File Number SR-Amex-2008-61 on 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 SR-Amex-2008-61. 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

[[Page 46104]]

information that you wish to make available publicly. All submissions 
should refer to File Number SR-Amex-2008-61 and should be submitted on 
or before August 28, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-18154 Filed 8-6-08; 8:45 am]

BILLING CODE 8010-01-P