Document ID: SEC-2008-0659-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Chicago Board Options Exchange, Inc.
Posted Date: 2008-05-07T04:00Z

[Federal Register: May 7, 2008 (Volume 73, Number 89)]
[Notices]               
[Page 25814-25815]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07my08-141]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57758; File No. SR-CBOE-2008-44]

 
Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Order Granting Accelerated Approval 
of Proposed Rule Change, as Modified by Amendment No. 1 Thereto, 
Relating to Equity Linked Term Notes

May 1, 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 April 15, 2008, the Chicago Board Options Exchange, 
Incorporated (``CBOE'' or ``Exchange'') filed with the Securities and 
Exchange Commission (``Commission'') the proposed rule change as 
described in Items I and II below, which Items have been prepared 
substantially by the Exchange. On April 30, 2008, the Exchange 
submitted Amendment No. 1 to the proposed rule change. The Commission 
is publishing this notice to solicit comments on the proposed rule 
change, as amended, from interested persons, and is granting 
accelerated approval to the proposed rule change.
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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 CBOE Rule 31.5(I), which provides 
the requirements for the listing and trading of Equity Linked Term 
Notes (``ELTNs'') on the Exchange. The text of the proposed rule change 
is available at the principal office of the Exchange, the Commission's 
Public Reference Room, and http://www.cboe.com.

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

    In its filing with the Commission, CBOE included statements 
concerning the purpose of, and basis for, the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item III below. CBOE 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
    Rule 19b-4(e)\3\ under the Act provides that the listing and 
trading of a new derivative securities product by a self-regulatory 
organization shall not be deemed a proposed rule change, pursuant to 
paragraph (c)(1) of Rule 19b-4,\4\ if the Commission has approved, 
pursuant to section 19(b) of the Act,\5\ the self-regulatory 
organization's trading rules, procedures, and listing standards for the 
product class that would include the new derivative securities product, 
and the self-regulatory organization has a surveillance program for the 
product class. The Exchange proposes to amend CBOE Rule 31.5(I), which 
sets forth CBOE's listing standards for ELTNs, to clarify that the 
listing and trading of ELTNs on CBOE, including the trading of ELTNs on 
CBOE pursuant to unlisted trading privileges, is subject to Rule 19b-
4(e) under the Act.
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    \3\ 17 CFR 240.19b-4(e).
    \4\ 17 CFR 240.19b-4(c)(1).
    \5\ 15 U.S.C. 78s(b).
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2. Statutory Basis
    Because this proposal clarifies that the listing and trading of 
ELTNs on the Exchange is subject to Rule 19b-4(e) under the Act,\6\ the 
Exchange believes that the proposal is consistent with the Act and the 
rules and regulations thereunder and, in particular, the requirements 
of Section 6(b) of the Act.\7\ Specifically, the Exchange believes that 
the proposal is consistent with the Section 6(b)(5) \8\ requirements 
that the rules of an exchange be designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, to remove impediments to and perfect the mechanism 
of a free and open market and a national market system, and, in 
general, to protect investors and the public interest.
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    \6\ 17 CFR 240.19b-4(e).
    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
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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 that is not

[[Page 25815]]

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 solicited or received with respect to the 
proposed rule change.

III. 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-2008-44 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-CBOE-2008-44. 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 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-2008-44 and should be 
submitted on or before May 28, 2008.

IV. Commission's Findings and Order Granting Accelerated Approval of 
the Proposed Rule Change

    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of the Act and the 
rules and regulations thereunder applicable to a national securities 
exchange.\9\ In particular, the Commission finds that the proposed rule 
change is consistent with section 6(b)(5) of the Act,\10\ which 
requires that the rules of an exchange be designed, among other things, 
to prevent fraudulent and manipulative acts and practices, to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general, to protect investors and the public interest.
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    \9\ In approving this rule change, the Commission notes that it 
has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
    \10\ 15 U.S.C. 78f(b)(5).
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    The Commission finds good cause for approving this proposal before 
the 30th day after the publication of notice thereof in the Federal 
Register. The proposal seeks to clarify that the Exchange's listing and 
trading of ELTNs is subject to Rule 19b-4(e) under the Act. Therefore, 
the Commission does not believe that the Exchange's proposal raises any 
novel regulatory issues. The Commission believes that accelerating 
approval of this proposal would ensure that the Exchange's rules 
clearly reflect the standards for listing and trading of ELTNs and 
conform the rules to those of other Exchanges without undue delay.\11\
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    \11\ See e.g., International Securities Exchange Rule 2130 and 
NYSE Arca Rule 5.2(j)(2).
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V. Conclusion

    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\12\ that the proposed rule change, as amended (SR-CBOE-2008-44), 
be, and it hereby is, approved on an accelerated basis.
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    \12\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-10071 Filed 5-6-08; 8:45 am]

BILLING CODE 8010-01-P