Document ID: SEC-2008-1004-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: International Securities Exchange
Posted Date: 2008-07-18T04:00Z

[Federal Register: July 18, 2008 (Volume 73, Number 139)]
[Notices]               
[Page 41389-41390]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18jy08-125]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58147; File No. SR-ISE-2008-53]

 
Self-Regulatory Organizations; International Securities Exchange, 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Relating to Fee Changes

July 11, 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 June 27, 2008, the International Securities Exchange (``Exchange'' 
or ``ISE'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change. On July 7, 2008, the 
Exchange filed Amendment No. 1 to the proposed rule change. The 
proposed rule change, as modified by Amendment No. 1, is described in 
Items I, II, and III below, which Items have been prepared by ISE. ISE 
has designated this proposal as one establishing or changing a due, 
fee, or other charge imposed by ISE 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, 
as modified by Amendment No. 1, 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 ISE is proposing to amend its Schedule of Fees with respect to 
transactions executed in securities reported to Tape B. The text of the 
proposed rule change is available on the Exchange's Web site (http://
www.ise.com), 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, ISE 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 ISE 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's current equity fee schedule consists of a tiered 
rebate structure: the first five million maker shares executed on an 
average daily volume (ADV) basis receive a rebate of $0.0032 per share, 
with an increase in the rebate to $0.0035 for each maker share executed 
above five million ADV. For shares executed on an order delivery basis, 
the Exchange currently rebates $0.0027 for maker shares executed. The 
Exchange proposes to retain this fee structure for transactions 
executed in securities reported to Tape A and Tape C (hereinafter 
referred to as Tape A and Tape C securities), but to change the fee 
structure for transactions executed in securities reported to Tape B 
(hereinafter, referred to as Tape B securities).
    Effective July 1, 2008, the Exchange proposes to adopt a fee 
structure for Tape B securities (excluding both order delivery and 
MidPoint Match orders) whereby the maker receives a per share rebate of 
$0.0017 and the taker fee is lowered from $0.003 to $0.0015 on all 
shares. The execution fee for equities priced under $1.00, regardless 
of which tape they are reported to, is 0.3% of trade value with no 
rebates for adding liquidity. For order delivery orders executed in 
Tape B securities, the Exchange proposes to provide a rebate of $0.0015 
for maker shares. The Exchange is lowering these fees in an effort to 
increase the trading volume in Tape B securities.\5\
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    \5\ See Amendment No. 1.
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    The Exchange proposes to add a note to the Schedule of Fees to 
clarify that Tape B securities maker transactions count towards ADV 
totals for the purpose of calculating Tape A and Tape

[[Page 41390]]

C securities rebates.\6\ Additionally, the Exchange proposes to clarify 
that the routing fee of $0.003 continues to apply on a per share basis 
for all securities routed to another market center, including Tape B 
securities.
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    \6\ Equity EAMs receive a rebate of $0.0035 per share in Tape A 
and Tape C securities for the maker shares exceeding the monthly ADV 
of 5 million. The first 5 million shares per day will continue to 
receive a rebate of $0.0032 per share.
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2. Statutory Basis
    The basis under the Act for this proposed rule change is the 
requirement under Section 6(b)(4) of the Act \7\ that an exchange have 
an equitable allocation of reasonable dues, fees and other charges 
among its members and other persons using its facilities.
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    \7\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change does not 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

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

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

    Because the foregoing rule change establishes or changes a due, 
fee, or other charge imposed by the Exchange, it has become effective 
pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(2) \9\ 
thereunder. 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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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 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 No. SR-ISE-2008-53 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-ISE-2008-53. 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 ISE. 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-ISE-2008-53 and should be 
submitted on or before August 8, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-16404 Filed 7-17-08; 8:45 am]

BILLING CODE 8010-01-P