Document ID: SEC-2009-0626-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX, Inc. Relating To Trading Post/Booth and Registration Fees
Posted Date: 2009-05-07T04:00Z

[Federal Register: May 7, 2009 (Volume 74, Number 87)]
[Notices]               
[Page 21424-21425]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07my09-140]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59852; File No. SR-Phlx-2009-39]

 
Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX, Inc. Relating 
To Trading Post/Booth and Registration Fees

April 30, 2009.
    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 April 24, 2009, NASDAQ OMX PHLX, Inc. (``Phlx'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``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: (1) 
Rename the Trading Post/Booth fee and increase the fee from $250 to 
$300 per month; (2) designate certain space on the trading floor as 
Market Maker Trading Space and assess members a fee of $300 per month; 
(3) eliminate the Trading Post with Kiosk fee of $375 per month and 
replace it with a Specialist Post fee of $4,500 per month for a full 
post and $1,125 per month for a quarter post, up to a maximum of 
$4,500; (4) increase the Floor Facility fee from $125 to $200 per 
month; (5) increase the Trading Floor Personnel Registration fee from 
$25 to $50 per month; and (6) make other minor amendments to the Fee 
Schedule.
    While changes to the Exchange's fee schedule pursuant to this 
proposal are effective upon filing, the Exchange has designated this 
proposal to be effective on May 1, 2009.
    The text of the proposed rule change is available on the Exchange's 
Web site at http://nasdaqomxphlx.cchwallstreet.com/NASDAQOMXPHLX/
Filings/, 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 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 increase the costs of 
certain floor-related charges due to a rise in occupancy expenses. The 
Exchange proposes to adjust its fees related to certain trading floor 
charges to keep pace with the rising overhead costs associated with 
maintaining the trading floor. The Exchange has not made any 
significant changes to these fees in several years.
    The Exchange proposes to increase the Trading Post/Booth fee from 
$250 to $300 per month. The Trading Post/Booth space is physical space 
on the Exchange's trading floor, which space typically is used by floor 
brokers. The Exchange proposes to increase this fee to cover increasing 
occupancy costs, such as electricity usage due to the increase of 
member computers on the trading floor. Additionally, the Exchange 
proposes to rename the Trading Post/Booth fee as the ``Trading/
Administrative Booths and Market Maker Trading Space'' fee. The 
Exchange proposes to designate certain space on the trading floor to be 
termed as ``Market Maker Trading Space'' and assess members $300 per 
month for that space. The Exchange would clearly define space where 
Register Options Traders could locate computer and related equipment 
required to function as a Streaming Quote Trader.\3\ The Exchange 
proposes to implement this fee to cover increasing costs associated 
with the trading floor.
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    \3\ A Streaming Quote Trader or SQT is an Exchange Registered 
Options Trader (``ROT'') who has received permission from the 
Exchange to generate and submit option quotations electronically 
through an electronic interface with AUTOM via an Exchange approved 
proprietary electronic quoting device in eligible options to which 
such SQT is assigned. See Exchange Rule 1014(b)(ii)(A).
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    The Exchange proposes to eliminate the Trading Post with Kiosk fee 
of $375. The kiosk is an open, flat surface that contains computer 
terminals and allows specialists to face the trading crowd. The fee is 
currently imposed on specialists with a trading post with kiosk on the 
trading floor. Instead, the Exchange proposes to adopt a Specialist 
Post fee which would vary with the size of the post. Specialists would 
be assessed a Specialist Post fee of $1,125 per month for a quarter 
post and $4,500 per month for a full post with a maximum fee of $4,500 
per month. Currently the specialists have multiple, contiguous, trading 
posts with kiosks on the trading floor. This fee should result in no 
additional increase to the specialists currently on the trading floor 
as the total amount paid currently for each trading post with kiosk, or 
$375, multiplied by the total number of posts utilized is equivalent to 
the fee range of the proposed charges, $1,125 for a quarter post and 
$4,500 for a full post, per month. Additionally, the Exchange is 
capping the total amount of fees paid by a specialist for the 
Specialist Post fee at $4,500 per month. The posts would continue to 
facilitate specialist interaction with the trading crowd.
    The Exchange proposes to increase the Floor Facility fee from $125 
to $200 per month. The Floor Facility fee is applicable to floor 
members and foreign currency options participants that are not 
currently assessed fees related to the usage of a Trading Post/Booth 
and would not be assessed a Trading/Administrative Booths and Market 
Maker Trading Space fee. The Floor Facility fee is intended to fairly 
allocate costs attendant to providing members and participants with 
services necessary to the conduct of business on the floor of the 
Exchange. The Exchange proposes to increase this fee to offset the 
increased costs of operating a trading floor facility.
    The Exchange also proposes increasing the Trading Floor Personnel 
Registration fee from $25 to $50 per month. Pursuant to Exchange Rule 
620 \4\ all trading floor personnel are required to be registered with 
the Exchange. This

[[Page 21425]]

fee is imposed on members and participant organizations for individuals 
who are employed by such member or participant organizations and who 
work on the Exchange's trading floor, such as clerks, interns, stock 
execution clerks and other associated persons, but who are not 
registered as members or participants. The Exchange proposes to 
increase this fee to offset the rising occupancy costs associated with 
operating a trading floor facility.
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    \4\ See Exchange Rule 620(a), titled Trading Floor Personnel 
Registration, ``Each Floor Broker, Specialist and Registered Options 
Trader on any Exchange trading floor must register as such with the 
Exchange. * * *''
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    The Exchange also proposes to make a minor amendment to its Fee 
Schedule to amend the title of Section II of the Fee Schedule. 
Currently that section is titled Index Options Fees and the Exchange 
proposes to amend that section title to ``Sector Index Options Fees.'' 
This title would be amended in the Table of Contents as well as in 
Section II of the Fee Schedule. The Exchange believes that the wording 
``Sector Index Options Fees'' is a more appropriate title for these 
products.
2. Statutory Basis
    The Exchange believes that its proposal to amend its schedule of 
fees is consistent with Section 6(b) of the Act \5\ in general, and 
furthers the objectives of Section 6(b)(4) of the Act \6\ in 
particular, in that it is an equitable allocation of reasonable fees 
and other charges among Exchange members. The Exchange believes that 
the proposed increases in fees to the associated Trading/Administrative 
Booths and Market Maker Trading Space, Floor Facility and Trading Floor 
Personnel fees are reasonable and the revenue will assist the Exchange 
in defraying the occupancy costs of maintaining the floor facility for 
its members. The Specialist Post fee should not result in a fee 
increase for specialists. The Exchange believes that because 
specialists pay significantly more total transaction fees on a monthly 
basis than similar fees assessed on Register Options Traders and floor 
brokers, the proposed fees are reasonable. Finally, the Exchange 
believes that the amendment to the title of Section II is a proper 
title to identify fees in the Fee Schedule.
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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 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 \7\ and paragraph (f)(2) of Rule 19b-4 \8\ 
thereunder. 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.
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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-Phlx-2009-39 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-2009-39. 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 the filing will also be available for 
inspection and copying at the principal office of the self-regulatory 
organization. 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-2009-39 and should be submitted on or before May 28, 2009.

    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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Elizabeth M. Murphy,
Secretary.
[FR Doc. E9-10524 Filed 5-6-09; 8:45 am]

BILLING CODE 8010-01-P