Document ID: SEC-2013-0429-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Chicago Board Options Exchange, Inc.
Posted Date: 2013-03-05T05:00Z

[Federal Register Volume 78, Number 43 (Tuesday, March 5, 2013)]
[Notices]
[Pages 14386-14388]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-04991]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68998; File No. SR-CBOE-2013-024]

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

February 27, 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 February 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 (``CBSX''). 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.

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 Exchange proposes to amend the CBSX Fees Schedule with regard 
to the data reports it provides to Trading Permit Holders (``TPHs'') 
and other interested parties at their requests. These persons and 
organizations sometimes approach CBSX and request that CBSX prepare and 
provide various reports regarding their trading activity. The 
production of these reports sometimes requires that employees put in a 
significant amount of time and work to write and develop the programs 
necessary to be able to run or generate such reports. Currently, the 
CBSX Fees Schedule does not speak to such requests (though the Fees 
Schedule of CBOE, CBSX's parent exchange, does \3\). The Exchange 
proposes to add to the CBSX Fees Schedule a comprehensive, consistent 
and standard structure

[[Page 14387]]

regarding the provision of CBSX data reports.
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    \3\ See CBOE Fees Schedule, Exchange Data Reports table.
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    CBSX proposes to establish three different tiers of data report 
requests. The first, most basic tier (referred to as ``C Level'' 
requests) will regard requests for standard reports regularly generated 
and run by CBSX and made available on a daily, weekly or monthly basis 
that do not require historical data generation, customization beyond a 
standard format (PDF, HTML, etc.) or distribution frequency (daily, 
weekly, monthly, etc.), or specialized development. There will be no 
cost for such requests, regardless of whether they are one-time, 
initial, or daily, weekly, or monthly requests.
    The second tier (referred to as ``B Level'' requests) will regard 
initial report requests (or enhancements to existing report 
subscriptions) that require less than one (1) man-hour to develop and/
or generate. The [sic] will be no cost for such requests. The third 
tier (referred to as ``A Level'' requests) will regard initial report 
requests (or enhancements to existing subscriptions) that require one 
(1) or more man-hours to develop and/or generate. The cost for such 
requests will be $100 for first 5 man-hours and $100 per hour for each 
additional man-hour. Fees for reports will be estimated in advance and 
such estimates will be provided to the requester. If the estimate 
changes once creation of the report begins, a revised estimate will be 
provided to the requester. For parties requesting to receive B or A 
Level reports on a recurring basis, subscriptions to such reports will 
be provided at a cost of $100 per month for monthly reports and $200 
per month for daily or weekly reports.
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. CBSX believes that the proposed new fee 
structure for data reports is reasonable because it is designed to 
reflect CBSX's costs in creating such reports. CBSX believes that the 
proposed new fee structure for data reports is equitable and not 
unfairly discriminatory because it will apply to all requesting parties 
equally. CBSX believes it is equitable and not unfairly discriminatory 
to assess no fees for C Level reports because these are standard 
reports that do not require specific development, customization or 
generation. CBSX believes that it is equitable and not unfairly 
discriminatory to assess no fees for initial B Level requests because 
these reports do not require very much (less than one man-hour) work on 
CBSX's part to create and produce. CBSX believes that it is equitable 
and not unfairly discriminatory to assess a fee of $100 for the first 
five man-hours of work for A Level requests because these reports take 
at least one man-hour of work on CBSX's part to develop and generate 
and CBSX must begin to recoup the costs of such work, while still 
desiring to be able to provide requesting market participants with a 
reasonable amount of information to assist them. CBSX believes that it 
is equitable and not unfairly discriminatory to assess a fee of $100 
per man-hour above five hours for A Level requests because such 
requests can take up a significant amount of CBSX resources and at this 
point CBSX must begin to be more fully-compensated for dedicating 
resources to these tasks. CBSX believes that it is equitable and not 
unfairly discriminatory to assess subscription fees for requests for 
information on a more regular basis (as opposed to re-assessing the 
initial fees) because the development for such work has already been 
done.
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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

    CBSX 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 fees structure will impose an unnecessary burden on 
intramarket competition because it will apply equally to all requesting 
parties. CBSX does not believe that the proposed fees structure will 
impose an unnecessary burden on intermarket competition because CBSX is 
providing reports specific to activity on CBSX, and other exchanges may 
provide reports specific to activity on those exchanges, and the costs 
for development, generation and production of such reports may be 
different on those exchanges. Further, to the extent that the proposed 
fees structure for data reports may attract market participants on 
other exchanges to CBSX, such market participants can always elect to 
become CBSX market participants.

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 C.F.R. 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-2013-024 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-2013-024. This file 
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

[[Page 14388]]

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 office 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-2013-024, and should be 
submitted on or before March 26, 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. 2013-04991 Filed 3-4-13; 8:45 am]
BILLING CODE 8011-01-P