
[Federal Register: July 9, 2010 (Volume 75, Number 131)]
[Notices]               
[Page 39602-39603]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09jy10-108]                         

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

SECURITIES AND EXCHANGE COMMISSION

 
Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated: Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Reduce the Payments That CBOE Makes to CBOE Trading 
Permit Holders That Participate in a Program Under Which CBOE 
Subsidizes the Costs of Providing and/or Using Certain Order Routing 
Functionalities

July 1, 2010.
    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 June 30, 2010, Chicago Board Options Exchange, Incorporated 
(``CBOE'' or 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 CBOE. 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.
---------------------------------------------------------------------------

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

    CBOE proposes to reduce the payments that CBOE makes to CBOE 
Trading Permit Holders that participate in a program under which CBOE 
subsidizes the costs of providing and/or using certain order routing 
functionalities. This rule change does not provide for any 
modifications to the text of 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 Commissions 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, CBOE 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. 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, Proposed Rule Change

1. Purpose
    CBOE proposes to reduce the payments that CBOE makes to CBOE 
Trading Permit Holders that participate in a program under which CBOE 
subsidizes the costs of providing and/or using certain order routing 
functionalities.\3\ If a Trading Permit Holder has elected not to have 
CBOE perform certain marketing services on its behalf, the payment 
would be reduced, with respect to orders routed to CBOE through a 
participating Trading Permit Holder's system, from $0.05 per contract 
to $0.04 per contract.\4\ If a member has elected to have CBOE perform 
marketing services on its behalf, the payment with respect to such 
orders would be reduced from $0.04 per contract to $0.03 per contract. 
The Exchange intends to make the change effective commencing August 1, 
2010.
---------------------------------------------------------------------------

    \3\ The order router subsidy program is described in SR-CBOE-
2007-34 (see Securities Exchange Act Release No. 55629 (April 13, 
2007), 72 FR 19992 (April 20, 2007) (SR-CBOE-2007-34)) as 
supplemented by SR-CBOE-2008-27 (see Securities Exchange Act Release 
No. 57498 (March 14, 2008), 73 FR 55 (March 20, 2008) (SR-CBOE-2008-
27)).
    \4\ The marketing services that CBOE provides to Trading Permit 
Holders electing to have CBOE provide such services are described on 
page 5 of SR-CBOE-2007-34.
---------------------------------------------------------------------------

    CBOE is not proposing any other changes in the program. CBOE stated 
in SR-CBOE-2007-34, and affirmed in SR-CBOE-2008-27, that nothing about 
the subsidy program would relieve any CBOE Trading Permit Holder that 
is using an order routing functionality whose provider is participating 
in the program from complying with its best execution obligations.\5\ 
Those statements remain true with respect to the program as CBOE is 
proposing to revise it.
---------------------------------------------------------------------------

    \5\ SR-CBOE-2007-34, pp. 5-6; SR-CBOE-2008-27, p 4.
---------------------------------------------------------------------------

2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the 
Securities Exchange Act of 1934 (``Act'') \6\, in general, and furthers 
the objectives of Section 6(b)(4) \7\ of the Act in particular, in that 
it is designed to provide for the equitable allocation of reasonable 
dues, fees, and other charges among CBOE Trading Permit Holders and 
other persons using its facilities.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4).

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

[[Page 39603]]

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 necessary or appropriate in 
furtherance of 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. 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 \8\ and subparagraph (f)(2) of Rule 19b-4 \9\ 
thereunder. At any time within 60 days of the filing of the 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)(2).
---------------------------------------------------------------------------

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-2010-066 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-2010-066. 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 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 
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-CBOE-2010-066 and should be 
submitted on or before August 9, 2010.


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Elizabeth M. Murphy,
Secretary.
[FR Doc. 2010-16686 Filed 7-8-10; 8:45 am]
BILLING CODE P

