Document ID: SEC-2013-2049-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Chicago Board Options Exchange, Inc.
Posted Date: 2013-12-02T05:00Z

[Federal Register Volume 78, Number 231 (Monday, December 2, 2013)]
[Notices]
[Pages 72137-72139]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-28725]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-70943; File No. SR-CBOE-2013-115]

Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend the CBSX Fees Schedule

November 25, 2013.
    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 November 21, 2013, Chicago Board Options Exchange, Incorporated 
(the ``Exchange'' or ``CBOE'') 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 Fees Schedule of its CBOE Stock 
Exchange. The text of the proposed rule change is available on the 
Exchange's Web site (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), 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 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
    CBSX proposes to amend its Maker fees for transactions in all other 
securities (securities other than the ``Select Symbols'', of which 
there currently are none) priced $1 or greater. Currently, such fees 
are assessed on the following scale: \3\
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    \3\ The parentheticals (1) and (5) in the scale refer to 
footnotes in the CBSX Fees Schedule. Footnote (1) reads:
     These rates apply to all transactions in securities priced $1 
or greater made by the same market participant in any day in which 
such participant adds (for Makers) or removes (for Takers) the 
established amount of shares (or percentage of TCV, as applicable) 
or more of liquidity that is determined in the chart above for each 
tier. Market participants who share a trading acronym or MPID may 
aggregate their trading activity for purposes of these rates. 
Qualification for these rates will require that a market participant 
appropriately indicate his trading acronym and/or MPID in the 
appropriate field on the order.
    Footnote (5) reads:
    ``TCV'' means total consolidated volume calculated as the volume 
reported by all exchanges and trade reporting facilities to a 
consolidated transaction reporting plan. Volume from Maker 
executions in the Select Symbols (priced $1 or greater) will count 
towards a market participant's % of TCV.
    The Exchange does not propose to amend either Footnotes (1) or 
(5).

------------------------------------------------------------------------
 
------------------------------------------------------------------------
Maker (adds less than 0.08% of TCV of liquidity   $0.0018 per share
 in one day) (1)(5).
Maker (adds at least 0.08% but less than 0.16%    $0.0017 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds at least 0.16% but less than 0.24%    $0.0016 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds at least 0.24% but less than 0.42%    $0.0015 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds 0.42% or more of TCV of liquidity in  $0.0014 per share
 one day) (1)(5).
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    The Exchange proposes to break up the 0.24%-0.42% tier into two 
separate tiers at 0.33%, with Maker transactions in the 0.33%-0.42% 
tier being assessed a lower fee of $0.0014 per share (currently, Maker 
transactions in such tier would be assessed the same fee as in the 
0.24%-0.33% tier, which is $0.0015 per share). The Exchange also 
proposes to add a 0.42%-0.52% tier, with Maker transactions in that 
tier being assessed a fee of $0.0013 per share (which is lower than the 
$0.0014 per share fee that Maker transactions in that tier currently 
are assessed). Finally, the Exchange proposes to add a tier for Makers 
who add 0.52% of TCV of liquidity in one day or more, with such 
transactions being assessed a lower fee of $0.0012 per share (which is 
lower than the $0.0014 per share fee that

[[Page 72138]]

Maker transactions in that tier currently are assessed). As such, upon 
effectiveness of the proposed changes, the Maker fees for transactions 
in all other securities priced $1 or greater will be as follows:

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Maker (adds less than 0.08% of TCV of liquidity   $0.0018 per share
 in one day) (1)(5).
Maker (adds at least 0.08% but less than 0.16%    $0.0017 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds at least 0.16% but less than 0.24%    $0.0016 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds at least 0.24% but less than 0.33%    $0.0015 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds at least 0.33% but less than 0.42%    $0.0014 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds at least 0.42% but less than 0.52%    $0.0013 per share
 of TCV of liquidity in one day) (1)(5).
Maker (adds 0.52% or more of TCV of liquidity in  $0.0012 per share
 one day) (1)(5).
------------------------------------------------------------------------

    The proposed changes are aspirational. The Exchange believes that 
the proposed new tiers will provide liquidity targets for CBSX market 
participants to aspire to reach, and the lowered fees in these new 
tiers will provide incentives for such CBSX market participants. The 
Exchange believes that the increased liquidity that results will 
benefit all market participants, and perhaps enable some such market 
participants to reach higher tiers (with the corresponding lower 
transaction fees) than they otherwise might.
    The proposed changes are to take effect on December 2, 2013.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\4\ Specifically, the Exchange believes the proposed rule change is 
consistent with Section 6(b)(4) of the Act,\5\ which requires that 
Exchange rules provide for the equitable allocation of reasonable dues, 
fees, and other charges among its Trading Permit Holders and other 
persons using its facilities. The Exchange believes the proposed fee 
(and tier) changes are reasonable because all the proposed changes 
involve lowering fees from their current levels (in the tiers created/
affected). There are no fee increases proposed by this proposed rule 
change, the affected market participants will certainly prefer to be 
assessed lower fees. The Exchange believes that the proposed changes 
are equitable and not unfairly discriminatory because, while they 
provide for lower fees for market participants who hit certain 
liquidity levels than others, the proposed new tiers (and corresponding 
lowered fees) are intended to provide liquidity targets for CBSX market 
participants to aspire to reach. The Exchange believes that the 
increased liquidity that results will benefit all market participants, 
and perhaps enable some such market participants to reach higher tiers 
(with the corresponding lower transaction fees) than they otherwise 
might. Finally, the proposed new fee tiers will be applied equally to 
all CBSX market participants.
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    \4\ 15 U.S.C. 78f(b).
    \5\ 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. CBSX does not believe that 
the proposed rule change will impose any burden on intramarket 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act because, while they provide for lower fees for 
market participants who hit certain liquidity levels than others, the 
proposed new tiers (and corresponding lowered fees) are intended to 
provide liquidity targets for CBSX market participants to aspire to 
reach. The Exchange believes that the increased liquidity that results 
will benefit all market participants, and perhaps enable some such 
market participants to reach higher tiers (with the corresponding lower 
transaction fees) than they otherwise might. Finally, the proposed new 
fee tiers will be applied equally to all CBSX market participants. The 
Exchange does not believe that the proposed rule change will impose any 
burden on intermarket competition that is not necessary or appropriate 
in furtherance of the purposes of the Act because the proposed changes 
are intended to attract greater liquidity and make CBSX a more 
attractive marketplace for market participants on all exchanges 
(thereby enhancing competition). To the extent that the proposed 
changes make CBSX a more attractive marketplace for market participants 
on other exchanges, such market participants may elect to become CBSX 
market participants. Also, the proposed changes only apply to trading 
on CBSX.

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 
proposed rule change.

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) of the Act \6\ and paragraph (f) of Rule 19b-4 \7\ 
thereunder. 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 will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
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    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f).
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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 email to rule-comments@sec.gov. Please include 
File Number SR-CBOE-2013-115 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-CBOE-2013-115. This file

[[Page 72139]]

number should be included on the subject line if email 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 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 
10:00 a.m. and 3:00 p.m. Copies of such filing also will be available 
for inspection and copying at the principal offices 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-2013-115, and should be submitted on or before 
December 23, 2013.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-28725 Filed 11-29-13; 8:45 am]
BILLING CODE 8011-01-P