Document ID: SEC-2008-0104-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: International Securities Exchange, LLC
Posted Date: 2008-01-22T05:00Z

[Federal Register: January 22, 2008 (Volume 73, Number 14)]
[Notices]               
[Page 3785-3786]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22ja08-107]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57144; File No. SR-ISE-2008-03]

 
Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule 
Change Extending the Pilot Program Increasing Position and Exercise 
Limits for Options on the iShares[supreg] Russell 2000[supreg] Index 
Fund

 January 14, 2008.
    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 January 8, 2008, the International Securities Exchange, LLC 
(``Exchange'' or ``ISE'') filed with the Securities and Exchange 
Commission (``Commission'') the proposed rule change as described in 
Items I and II below, which Items have been substantially prepared by 
the Exchange. The Exchange has designated this proposal as non-
controversial under Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 
19b-4(f)(6) thereunder,\4\ which renders the proposed rule change 
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)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange is proposing to extend an existing pilot program that 
increases the position and exercise limits for options on the 
iShares[supreg] Russell 2000[supreg] Index Fund (``IWM'') traded on the 
Exchange (``IWM Pilot Program''). The text of the proposed rule change 
is available on the Exchange's Web site (http://www.ise.com), at the 

Exchange's principal office, and at the Commission's Public Reference 
Room.

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 IWM Pilot Program provides for increased position and exercise 
limits for IWM options traded on the Exchange.\5\ Specifically, the IWM 
Pilot Program increases the position and exercise limits for IWM 
options from 250,000 contracts to 500,000 contracts.\6\
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    \5\ The proposal that established the IWM Pilot Program was 
designated by the Commission to be effective and operative upon 
filing. See Securities Exchange Act Release No. 55175 (January 25, 
2007), 72 FR 4753 (February 1, 2007) (SR-ISE-2007-07). The IWM Pilot 
Program was extended by the Commission and is due to expire on 
January 18, 2008. See Securities Exchange Act Release No. 56020 
(July 6, 2007), 72 FR 38109 (July 12, 2007) (SR-ISE-2007-56).
    \6\ Pursuant to ISE Rule 414, the exercise limit established 
under Rule 414 for IWM options shall be equivalent to the position 
limit prescribed for IWM options in Supplementary Material .01 to 
Rule 412. The increased exercise limits would only be in effect 
during the pilot period, to run from January 22, 2007 through March 
1, 2008.
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    The purpose of the proposed rule change is to extend the IWM Pilot 
Program until March 1, 2008. The Exchange is not proposing any other 
changes to the IWM Pilot Program. The Exchange believes that extending 
the IWM Pilot Program is warranted due to the positive feedback 
received from market participants and for the reasons cited in the 
original rule filing that proposed the adoption of the IWM Pilot 
Program. Further, the Exchange represents that it has not encountered 
any problems or difficulties relating to the IWM Pilot Program since 
its inception.
    The Exchange believes that maintaining the increased position and 
exercise limits for IWM options will lead to a more liquid and more 
competitive market environment for IWM options that will benefit 
customers interested in trading this product. As a result, the Exchange 
requests that the Commission extend the pilot through March 1, 2008.

[[Page 3786]]

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with and furthers the objectives of Section 6(b)(5) of the Act \7\ in 
that it is designed to promote just and equitable principles of trade, 
to remove impediments to and perfect the mechanisms 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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    \7\ 15 U.S.C. 78f(b)(5).
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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 that is 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 not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

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

    The Exchange has designated the proposed rule change as one that: 
(1) Does not significantly affect the protection of investors or the 
public interest; (2) does not impose any significant burden on 
competition; and (3) does not become operative for 30 days from the 
date of filing, or such shorter time as the Commission may designate if 
consistent with the protection of investors and the public interest. 
Therefore, the foregoing rule change has become effective pursuant to 
Section 19(b)(3)(A) of the Act \8\ and subparagraph (f)(6) of Rule 19b-
4 thereunder.\9\ The Exchange has asked the Commission to waive the 
operative delay to permit the Pilot Program extension to become 
effective prior to the 30th day after filing.
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to provide the Commission 
with written notice of its intent to file the proposed rule change, 
along with a brief description and text of 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 Exchange has fulfilled this requirement.
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    The Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest 
because it will allow the benefits of the IWM Pilot Program to continue 
without interruption.\10\ Therefore, the Commission designates the 
proposal operative upon filing.
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    \10\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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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 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.

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 No. SR-ISE-2008-03 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-ISE-2008-03. 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 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-ISE-2008-03 and should be 
submitted on or before February 12, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-967 Filed 1-18-08; 8:45 am]

BILLING CODE 8011-01-P