Document ID: SEC-2008-0502-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: American Stock Exchange LLC
Posted Date: 2008-04-02T04:00Z

[Federal Register: April 2, 2008 (Volume 73, Number 64)]
[Notices]               
[Page 18011-18013]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02ap08-103]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57562; File No. SR-Amex-2008-26]

 
Self-Regulatory Organizations; American Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating to the Elimination of the Options Marketing Fee Related to P/A 
Orders That Are Routed Via the Options Linkage for Execution on an Away 
Options Exchange

March 26, 2008.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

[[Page 18012]]

(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on March 19, 2008, the American Stock Exchange LLC (``Amex'' 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 prepared by the Exchange. Amex has 
designated this proposal as one establishing or changing a due, fee, or 
other charge imposed by Amex under Section 19(b)(3)(A)(ii) of the Act 
\3\ and Rule 19b-4(f)(2) thereunder,\4\ which renders the proposal 
effective upon filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to eliminate the options marketing fee 
related to principal acting as agent (``P/A'') orders that are routed 
via the Options Linkage for execution on an away options exchange. The 
text of the proposed rule change is available at the Exchange, 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 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. Amex 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 Exchange proposes to eliminate the options marketing fee 
related to P/A Orders that are routed via the Options Linkage for 
execution on an away options exchange. A P/A Order is an order for the 
principal account of a specialist reflecting the terms of a related 
unexecuted public customer order for which the specialist is acting as 
agent. The Exchange believes that specialists, registered options 
traders (``ROTs''), and supplemental registered options traders 
(``SROTs'') should not be subject to the options marketing fee for P/A 
Orders that are executed on an away options exchange.
    The options marketing fee is collected on those specialist, ROT, 
and SROT transactions involving electronically executed customer orders 
from firms accepting payment for directing their orders to the 
Exchange. The Exchange believes that, accordingly, the purpose of the 
options marketing fee is to provide incentives for an order flow 
provider to send customer order flow to the Amex.
    The Exchange states that if a specialist, ROT or SROT has 
negotiated a payment to a firm of less than the marketing fee, the 
difference between the marketing fee and the actual payment is refunded 
to the specialist, ROT and SROT. The options marketing fee is also not 
charged on transactions between and among ROTs and specialists.
    The current options marketing fee, on a per contract side basis, is 
set forth below.

----------------------------------------------------------------------------------------------------------------
                                          Specialist and Registered     Supplemental Registered Options Trader
                                            Options Trader (ROT)                        (SROT)
----------------------------------------------------------------------------------------------------------------
Equity Options.........................  $0.75 or $0.35 or $0.40*..  0.75 or $0.35*
Exchange-Traded Fund Share Options       $0.75 or $0.35 or $0.40*..  $0.75 or $0.35*
 (including QQQQ Options and excluding
 SPY Options*).
SPY Options............................  $1.00 or $0.40*...........  $1.00
Trust Issued Receipt (HOLDR) Options...  $0.75 or $0.35 or $0.40*..  $0.75 or $0.35*
Index Options (including MNX Options     No Charge.................  No Charge.
 and excluding NDX and RUT Options).
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* The $0.35 options marketing fee applies to those series of Equity Options, Exchange Traded Fund Share Options,
  and Trust Issued Receipt Options that quote and trade in one cent increments under the penny pilot program.
  The $0.40 options marketing fee applies to those series of Equity Options, Exchange Traded Fund Share Options
  (including SPY Options), Trust Issued Receipt Options, and NDX and RUT Options that are manually executed
  customer orders of 1,000 contracts or greater.

    The Exchange states that the purpose of this proposal is to 
eliminate the options marketing fees for specialists, ROTs, and SROTs 
in those cases where an underlying customer order through a P/A Order 
is routed to an away exchange as required by the Options Linkage Plan 
and the related rules of the Exchange. In such an instance, the 
Exchange believes that the purpose for imposing the options marketing 
fee does not exist.
    The Exchange believes that this proposal to eliminate the options 
marketing fee for P/A Orders that are routed via the Options Linkage to 
an away options exchange for execution is necessary so that 
specialists, ROTs, and SROTs are not paying an options marketing fee 
for orders that are not executed on the Exchange.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \5\ in general, and Section 6(b)(4) of the 
Act \6\ in particular, in that it is designed to provide for an 
equitable allocation of reasonable dues, fees, and other charges among 
its members and issuers and other persons using exchange facilities.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4).
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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 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.

[[Page 18013]]

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

    The foregoing proposed rule change has been designated as a fee 
change pursuant to Section 19(b)(3)(A)(ii) of the Act \7\ and Rule 19b-
4(f)(2) \8\ thereunder, because it establishes or changes a due, fee, 
or other charge imposed by the Exchange. Accordingly, the proposal will 
take effect upon filing with the Commission. 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.
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    \7\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \8\ 17 CFR 240.19b-4(f)(2).
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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-Amex-2008-26 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.
All submissions should refer to File Number SR-Amex-2008-26. 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 such 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-Amex-2008-26 and should be 
submitted on or before April 23, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8-6730 Filed 4-1-08; 8:45 am]

BILLING CODE 8011-01-P