Document ID: SEC-2008-1322-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Chicago Board Options Exchange, Inc.
Posted Date: 2008-09-29T04:00Z

[Federal Register: September 29, 2008 (Volume 73, Number 189)]
[Notices]               
[Page 56620-56622]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr29se08-119]                         

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58615; File No. SR-CBOE-2008-95]

 
Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Amend CBOE Rules Relating to Appointment Costs

September 22, 2008.
    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 September 16, 2008, the 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 and II below, which Items have been prepared by 
the Exchange. The Exchange filed the proposal as a ``non-
controversial'' proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(6) thereunder.\4\ The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to make technical changes to the tables 
setting forth the appointment costs for option classes in CBOE's rules. 
The text of the proposed rule change is available on the Exchange's Web 
site (http://www.cboe.org/Legal), at the Exchange's Office of the 
Secretary and at the Commission.

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 self-regulatory organization 
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 those 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 parts of such statements.

[[Page 56621]]

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

1. Purpose
    The purpose of this rule change is to make technical changes to the 
tables setting forth the appointment costs for option classes in CBOE's 
rules.
    In connection with CBOE's determination to trade options on the 
Morgan Stanley Retail Index Option class (MVR) on the Hybrid Trading 
System (``Hybrid'') commencing on September 23, 2008,\5\ CBOE proposes 
to delete reference to MVR in the list of Hybrid 3.0 classes in the 
table contained in Rule 8.3(c)(iii). MVR then would be added to the 
table of Hybrid classes in paragraph (c)(i) of Rule 8.3 and placed in 
the AA Tier, which has been reconfigured to hold all option classes 
which have a fixed appointment cost. CBOE intends to maintain an 
appointment cost of .25 for MVR when it trades on Hybrid.
---------------------------------------------------------------------------

    \5\ MVR currently trades on the Hybrid 3.0 Platform.
---------------------------------------------------------------------------

    As noted above, CBOE also proposes to reconfigure the AA and A+ 
Tiers in Rule 8.3(c)(i) such that the AA Tier would hold all option 
classes which have a fixed appointment cost. The reference to an A+ 
Tier would be deleted, and the five option classes currently in the A+ 
Tier would be placed in the AA Tier.\6\ The appointment cost of the 
existing AA Tier classes and the former A+ Tier classes would remain 
the same. CBOE is making this change for operational reasons.
---------------------------------------------------------------------------

    \6\ CBOE also proposes to make a technical change to Rule 
8.85(e) and Rule 8.92(d) to delete the reference to the A+ Tier.
---------------------------------------------------------------------------

    CBOE believes that these changes to the tables are technical in 
nature and will facilitate CBOE's decision to trade MVR on the Hybrid 
Trading System.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations under the Act applicable to a national securities exchange 
and, in particular, the requirements of Section 6(b) of the Act. 
Specifically, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) Act \7\ requirements that the rules 
of an exchange be designed to promote just and equitable principles of 
trade, in that these proposed changes are technical in nature and 
enable the Exchange to trade MVR on Hybrid.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    CBOE 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

    The Exchange neither solicited nor received comments on the 
proposal.

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

    Because the foregoing rule does not (i) significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 30 
days from the date on which it was filed, or such shorter time as the 
Commission may designate if consistent with the protection of investors 
and the public interest, provided that the self-regulatory organization 
has given the Commission written notice of its intent to file the 
proposed rule change at least five business days prior to the date of 
filing of the proposed rule change or such shorter time as designated 
by the Commission, the proposed rule change has become effective 
pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(6) 
thereunder.\9\ 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.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    Under Rule 19b-4(f)(6) of the Act,\10\ the proposal does not become 
operative for 30 days after the date of its filing, or such shorter 
time as the Commission may designate if consistent with the protection 
of investors and the public interest. The Exchange has requested that 
the Commission waive the 30-day operative date. The Exchange states 
that waiving the 30 days will enable it to begin trading MVR options on 
Hybrid on September 23, 2008, which would promote competition and 
efficiency without undue delay. Based on these reasons, the Commission 
believes that waiving the 30-day operative delay is consistent with the 
protection of investors and the public interest, and thus designates 
the proposal effective upon filing.\11\
---------------------------------------------------------------------------

    \10\ Id.
    \11\ For purposes only of waiving the operative date of this 
proposal, the Commission has considered the proposed rule's impact 
on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
---------------------------------------------------------------------------

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-CBOE-2008-95 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-CBOE-2008-95. 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 CBOE. 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

[[Page 56622]]

submissions should refer to File Number SR-CBOE-2008-95 and should be 
submitted on or before October 20, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
Florence E. Harmon,
Acting Secretary.
---------------------------------------------------------------------------

    \12\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

[FR Doc. E8-22747 Filed 9-26-08; 8:45 am]

BILLING CODE 8010-01-P