Document ID: SEC-2009-1656-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the Fee Schedule of the Boston Options Exchange Facility
Posted Date: 2009-11-24T05:00Z

[Federal Register: November 24, 2009 (Volume 74, Number 225)]
[Notices]               
[Page 61397-61398]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24no09-89]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61017; File No. SR-BX-2009-072]

 
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Amending the 
Fee Schedule of the Boston Options Exchange Facility

November 17, 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 November 12, 2009, NASDAQ OMX BX, Inc. (the ``Exchange'') 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 by the Exchange. The Exchange filed the proposed 
rule change pursuant to Section 19(b)(3)(A)(ii) of the Act\3\ and Rule 
19b-4(f)(2) thereunder,\4\ which renders the proposal effective upon 
filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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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 Fee Schedule of the Boston 
Options Exchange Group, LLC (``BOX''). The text of the proposed rule 
change is available from the principal office of the Exchange, at the 
Commission's Public Reference Room and also on the Exchange's Internet 
website at http://nasdaqomxbx.cchwallstreet.com/NASDAQOMXBX/Filings/.

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 these statements may be examined at 
the places specified in Item IV below. The self-regulatory organization 
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 recently submitted a proposed rule change, SR-BX-2009-
071, which made several changes to the BOX Fee Schedule.\5\ Certain of 
these changes eliminated references to outbound P/A Orders from the Fee 
Schedule as these order types are no longer sent by BOX.\6\ Some of the 
text that was removed from the Fee Schedule in SR-BX-2009-071 should 
not have been removed but rather amended to reflect applicability to 
Eligible Orders that are routed away by Routing Brokers.
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    \5\ See Securities Exchange Act Release No. 60934 (November 4, 
2009), 74 FR 58358 (November 12, 2009) (SR-BX-2009-071). The BOX Fee 
Schedule can be found on the BOX Website at http://
www.bostonoptions.com.
    \6\ The Exchange is a participant in the Options Order 
Protection and Locked/Crossed Market Plan (``Decentralized Plan''). 
See Securities Exchange Act Release No. 60405 (July 30, 2009), 74 FR 
39362 (August 6, 2009) (File No. 4-546) (Order Approving the 
National Market System Plan Relating to Options Order Protection and 
Locked/Crossed Market Plan). Instead of routing P/A Orders BOX now 
sends Eligible Orders to Away Exchange(s), when such Away 
Exchange(s) display the Best Bid or Best Offer, in accordance with 
the Decentralized Plan, via certain non-affiliated third party 
routing broker/dealers (``Routing Broker(s)''). See Securities 
Exchange Act Release No. 60832 (October 16, 2009), 74 FR 54607 
(October 22, 2009) (SR-BX-2009-66).
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    The Exchange proposes to once again include the specific language 
in the BOX Fee Schedule, as appropriate, to reflect its applicability 
to Eligible Orders routed to Away Exchanges by Routing Brokers. 
Specifically, the Exchange proposes to exempt outbound Eligible Orders 
routed to Away Exchanges by Routing Brokers from the fees and credits 
of Section 7 of the BOX Fee Schedule, as these transactions are deemed 
to neither `add' nor `take' liquidity from the BOX Book.\7\ 
Additionally, the Exchange proposes to impose of a fee of $0.50 per 
contract for all Eligible Orders routed to Away Exchanges by Routing 
Brokers in excess of 4,000 contracts per month for an individual BOX 
Options Participant, as was imposed for outbound P/A Orders.\8\
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    \7\ See Securities Exchange Act Release No. 60504 (August 14, 
2009), 74 FR 42724 (August 24, 2009) (SR-BX-2009-047).
    \8\ See Securities Exchange Act Release No. 60610 (September 1, 
2009), 74 FR 46285 (September 8, 2009) (SR-BX-2009-058). The 
Exchange stated in SR-BX-2009-58 that ``exempting all outbound P/A 
Orders from fees may tempt BOX Options Participants to increase non 
executable order flow to BOX in order to avoid fees on other 
exchanges.'' The Exchange proposed the $0.50 fee ``to eliminate the 
abusive use of this exemption.'' As proposed in SR-BX-2009-58, the 
proposed re-inclusion of this fee will have no effect on the billing 
of orders of non-BOX Options Participants.
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    Additionally, the Exchange proposes a clarifying change to text of 
Section 7(d) of the BOX Fee Schedule regarding the volume discount 
applied to executions in Price Improvement Period (``PIP'') auctions of 
the Participant that initiated the PIP which occur at a price at least 
better than the NBBO. To clarify the application of the volume discount 
the Exchange proposes that the final sentence of Section 7(d) will read 
as follows: ``This discount is calculated monthly for the Participant's 
previous calendar month's executions in PIP auctions which it initiated 
and which were filled at a price at least better than the NBBO.''

[[Page 61398]]

2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act,\9\ in general, and Section 
6(b)(5) of the Act,\10\ in particular, in that it is designed to foster 
cooperation and coordination with persons engaged in regulating, 
clearing, settling, processing information with respect to, and 
facilitating transactions in securities, to remove impediments to and 
perfect the mechanism for a free and open market and a national market 
system and, in general, to protect investors and the public interest, 
as well Section 6(b)(4) of the Act,\11\ in particular, in that it 
provides for the equitable allocation of reasonable dues, fees, and 
other charges among its members and issuers and other persons using its 
facilities. The proposed changes will result in clarification of the 
fees charged for trading activity on BOX.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(5).
    \11\ 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

    The Exchange has 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)(ii) of the Exchange Act\12\ and Rule 19b-4(f)(2) 
thereunder,\13\ because it establishes or changes a due, fee, or other 
charge applicable only to a member.
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    \12\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \13\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily abrogate the rule change if it 
appears to the Commission that the action is necessary or appropriate 
in the public interest, for the protection of investors, or would 
otherwise further the purposes of the Act.

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-BX-2009-072 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-BX-2009-072. 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 will also 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 No. SR-BX-2009-072 and should be 
submitted on or before December 15, 2009.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9-28099 Filed 11-23-09; 8:45 am]

BILLING CODE 8011-01-P