Document ID: SEC-2011-0556-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ OMX PHLX LLC
Posted Date: 2011-04-14T04:00Z

[Federal Register Volume 76, Number 72 (Thursday, April 14, 2011)]
[Notices]
[Pages 21078-21080]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-9073]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64286; File No. SR-Phlx-2011-50]

Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Relating to 
Singly Listed and Multiply Listed Indexes

April 8, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given 
that on April 8, 2011, NASDAQ OMX PHLX LLC (``Phlx'' or ``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 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 amend the Exchange's Fee Schedule to 
discontinue assessing an Options Surcharge Fee for RMN.\3\
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    \3\ RMN represents options on the one-tenth value Russell 
2000[supreg] Index (the ``Reduced Value Russell Index'' or ``RMN'').
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    The Exchange also proposes to remove specific symbol references to 
certain indexes in the title of Section II of the Exchange's Fee 
Schedule captioned, ``Equity Options Fees (Includes options overlying 
equities, ETFs, ETNs, HOLDRS, BKX, RUT, RMN, MNX, NDX which are 
Multiply Listed)'' and instead substitute the word ``indexes.'' The 
Exchange proposes to make other conforming changes in the Fee Schedule.
    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, 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

[[Page 21079]]

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 discontinue assessing 
an Options Surcharge for RMN because that index is no longer Multiply 
Listed and the license fee costs would be absorbed in the fees assessed 
on Singly Listed products.\4\ The Exchange currently assesses an 
Options Surcharge for RUT,\5\ RMN, MNX \6\ and NDX \7\ of $.15 per 
contract for Specialists, ROTs, SQTs \8\ and RSQTs,\9\ Broker Dealers 
and Firms. The Exchange will continue to assess an Options Surcharge 
for RUT, MNX, NDX and BKX.
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    \4\ RMN recently became a Singly Listed index option. The 
Exchange assesses higher fees for Singly Listed options as there are 
increased costs associated with those products.
    \5\ RUT represents the options on the Russell 2000[reg] Index 
(the ``Full Value Russell Index'' or ``RUT'').
    \6\ MNX represents options on the one-tenth value of the Nasdaq 
100 Index traded under the symbol MNX (``MNX'').
    \7\ NDX represents options on the Nasdaq 100 Index traded under 
the symbol NDX (``NDX'').
    \8\ An SQT is defined in Exchange Rule 1014(b)(ii)(A) as an ROT 
who has received permission from the Exchange to generate and submit 
option quotations electronically in options to which such SQT is 
assigned.
    \9\ A RSQT is defined Exchange Rule in 1014(b)(ii)(B) as 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 in options to 
which such RSQT has been assigned. An RSQT may only submit such 
quotations electronically from off the floor of the Exchange.
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    The purpose of this rule change is also to make the title of 
Section II of the Fee Schedule more general to address when a 
particular option switches from a Multiply Listed to a Singly Listed 
product. Specifically, the Exchange is amending Section II of the Fee 
Schedule, titled ``Equity Options Fees (Includes options overlying 
equities, ETFs, ETNs, HOLDRS, BKX, RUT, RMN, MNX, NDX which are 
Multiply Listed)'' to ``Equity Options Fees (Includes options overlying 
equities, ETFs, ETNs, indexes and HOLDRS, which are Multiply Listed).'' 
The Exchange is proposing to remove specific references to certain 
index symbols, namely BKX,\10\ RUT, RMN, MNX and NDX, in the heading 
and instead use the broader term ``indexes'' in order to account for a 
circumstance where one of these named index options becomes Singly 
Listed.\11\ The broader term ``indexes'' would clarify that only index 
options that are Multiply Listed would be assessed the fees in Section 
II. Index options that are Singly Listed options would continue to be 
assessed the fees in Section III, which applies to options overlying 
currencies, equities, ETFs, ETNs, indexes and HOLDRs not listed on 
another exchange.
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    \10\ BKX represents the KBW Bank Index.
    \11\ RMN recently became a Singly Listed index option. This 
proposed amendment would remove RMN from Section II of the Fee 
Schedule as well as the other specifically named index symbols and 
instead refer to indexes generally.
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    The Exchange is proposing to make this change in the Preface 
Section of the Fee Schedule as well as references to Section II fees in 
Section IV, titled ``PIXL Pricing.''
2. Statutory Basis
    The Exchange believes that its proposal to amend its Fee Schedule 
is consistent with Section 6(b) of the Act \12\ in general, and 
furthers the objectives of Section 6(b)(4) of the Act \13\ in 
particular, in that it is an equitable allocation of reasonable fees 
and other charges among Exchange members and other persons using its 
facilities.
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    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that it is reasonable to not assess an 
Options Surcharge on RMN, a Singly Listed index option, because the 
license costs, which are recouped by the Options Surcharge Fee, are 
absorbed in the higher fees assessed to Singly Listed index options.
    The Exchange believes that it is reasonable to remove the specific 
references to certain index symbols and instead insert the reference to 
``indexes'' because the reference to the category of products is 
consistent with the remainder of the Fee Schedule \14\ and more 
accurately describes the category of products applicable to Section II 
of the Fee Schedule.
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    \14\ See Section III of the Fee Schedule titled ``Singly Listed 
Options (Includes options overlying currencies, equities, ETFs, 
ETNs, indexes and HOLDRS not listed on another exchange), where the 
broader term ``indexes'' is utilized.
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    The Exchange believes that the proposals to not assess an Options 
Surcharge on RMN and remove specific references to index symbols and 
insert the reference to ``indexes'' are equitable because these 
proposals would uniformly apply to members and member organizations 
trading Singly Listed and Multiply Listed products.

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.\15\ At any time within 60 days of the 
filing of the proposed rule change, the Commission summarily may 
temporarily suspend 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. If the Commission takes such action, the 
Commission shall institute proceedings to determine whether the 
proposed rule should be approved or disapproved.
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    \15\ 15 U.S.C. 78s(b)(3)(A)(ii).
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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-Phlx-2011-50 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.

All submissions should refer to File Number SR-Phlx-2011-50. 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

[[Page 21080]]

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-Phlx-2011-50 and should be submitted on 
or before May 5, 2011.

    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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Cathy Ahn,
Deputy Secretary.
[FR Doc. 2011-9073 Filed 4-13-11; 8:45 am]
BILLING CODE 8011-01-P