Document ID: SEC-2007-0655-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: Options Clearing Corp.
Posted Date: 2007-05-10T04:00Z

[Federal Register: May 10, 2007 (Volume 72, Number 90)]
[Notices]               
[Page 26669-26671]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10my07-121]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55709; File No. SR-OCC-2007-05]

 
Self-Regulatory Organizations; The Options Clearing Corporation; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating to OCC's Clearing Fee Schedule

May 4, 2007.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ notice is hereby given that on April 11, 2007, The 
Options Clearing Corporation (``OCC'') 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 
primarily by OCC. 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).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The proposed rule change would (i) make permanent the current 
discounted clearing fee schedule for specified contracts, (ii) further 
discount the newly adopted clearing fee schedule, and (iii) modify the 
new product clearing fee schedule, with all changes being effective May 
1, 2007.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections (A), 
(B), and (C) below, of the most significant aspects of such 
statements.\2\
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    \2\ The Commission has modified parts of these statements.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    The purpose of the proposed rule change is to amend OCC's standard 
clearing and new products fee schedules, effective May 1, 2007, as 
described below. First, OCC is making permanent the current discounted 
clearing fee schedule for (i) securities

[[Page 26670]]

options and (ii) security futures where at least one side of the trade 
is cleared by an OCC clearing member. Second, OCC is discounting the 
newly adopted permanent clearing fee schedule until further action by 
the OCC Board of Directors. Third, OCC is modifying its new product fee 
schedule to reflect the foregoing clearing fee changes and to make it 
easier to administer. The following charts summarize the changes:

----------------------------------------------------------------------------------------------------------------
                                          Current permanent
                                       standard fee  schedule,   New permanent standard  Discounted standard fee
           Contracts/trade               effective  April 1,         fee  schedule,         schedule, effective
                                                 2004           effective  May 1, 2007*        May 1, 2007
----------------------------------------------------------------------------------------------------------------
1-500................................  $0.0825/contract.......  $0.05/contract.........  $0.035/contract.
501-1,000............................  $0.0675/contract.......  $0.04/contract.........  $0.028/contract.
1,001-2,000..........................  $0.0575/contract.......  $0.03/contract.........  $0.021/contract.
>2,000...............................  $110.00 (capped).......  $55.00 (capped)........  $35.00 (capped).
----------------------------------------------------------------------------------------------------------------
*Clearing fees are currently charged at these rates as discounted fees. See File No. SR-OCC-2006-14.

------------------------------------------------------------------------
 New product fee schedule, effective July     New product fee schedule,
                  1, 2005                       effective May 1, 2007
------------------------------------------------------------------------
First calendar month traded: $ .00.         From first day of listing
                                             through the end of the
                                             following calendar month.
Second calendar month traded: $0.00.
Cleared trades w/contracts of: 1-4,400--$
 .01.
Thereafter reverts to clearing fees
 specified in the current clearing fee
 schedule.
Greater than 4,400--$ 40.00 per trade
Third calendar month traded:                ............................
Cleared trades w/contracts of: 1-2,200--$   ............................
 .02.
Greater than 2,200--$ 40.00 per trade.      ............................
Fourth calendar month traded:               ............................
Reverts to current clearing fees.           ............................
------------------------------------------------------------------------

    The foregoing reductions in OCC's clearing fees reflect the strong 
contract volume experienced by OCC this year to date. OCC believes that 
these fee changes will financially benefit clearing members and other 
market participants without adversely affecting OCC's ability to meet 
its expenses and maintain an acceptable level of retained earnings. The 
discounted clearing fees will remain in effect until further action by 
OCC's Board of Directors.
    The proposed rule change is consistent with Section 17A of the Act 
because it benefits clearing members and other market participants by 
reducing and discounting clearing fees and allocating them in a fair 
and equitable manner. The proposed rule change is not inconsistent with 
the existing rules of OCC, including any other rules proposed to be 
amended.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    OCC does not believe that the proposed rule change would impose any 
burden on competition.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants, or Others

    Written comments were not and are not intended to be solicited with 
respect to the proposed rule change and none have been received.

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

    Because the foregoing rule change changes fees charged clearing 
members by OCC, it has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act\3\ and Rule 19b-4(f)(2)\4\ thereunder. At 
any time within sixty 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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    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 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-OCC-2007-05 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-OCC-2007-05. 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 Section, 100 F Street, 
NE., Washington, DC 20549. Copies of such filing also will be available 
for inspection and copying at the principal office of OCC and on OCC's 
Web site at http://www.optionsclearing.com.

    All comments received will be posted without change; the Commission 
does not edit personal identifying

[[Page 26671]]

information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-OCC-2007-05 and should be submitted on or before May 31, 
2007.

    For the Commission by the Division of Market Regulation, 
pursuant to delegated authority.\5\
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    \5\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-8957 Filed 5-9-07; 8:45 am]

BILLING CODE 8010-01-P