
[Federal Register Volume 77, Number 100 (Wednesday, May 23, 2012)]
[Notices]
[Pages 30566-30570]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-12441]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67009; File No. SR-BX-2012-036]


Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
the Grandfathered Rules, BOX Trading Rules, BX By-Laws, BX Rules and 
Remove the BOXR Operating Agreement and By-Laws

May 17, 2012.
    Pursuant to Section 19(b)(1) under the Securities Exchange Act of 
1934 (the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby 
given that on May 14, 2012, NASDAQ OMX BX (``BX'' or the ``Exchange'') 
filed with the Securities and Exchange Commission (the ``Commission'') 
the proposed rule change as described in Items I and II below, which 
Items have been prepared by the Exchange. The Exchange has designated 
the proposed rule change as constituting a non-controversial rule 
change under Rule 19b-4(f)(6) under the Act,\3\ 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\ 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 proposes to amend proposal [sic] to amend the 
Grandfathered Rules, the Boston Options Exchange Group LLC (``BOX'') 
Trading Rules, remove the Boston Options Exchange Regulation LLC 
(``BOXR'') By-Laws and the Amended and Restated Limited Liability 
Company Agreement (``BOXR Operating Agreement''), and amend the BX By-
Laws and the BX Rules. 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 
Web site 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 Exchange included statements 
concerning the purpose of and basis for

[[Page 30567]]

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
    Boston Options Exchange LLC (``BOX'') is ceasing to operate as an 
options trading facility of the Exchange.\4\ BX and BOX have entered 
into a Regulatory Services Agreement which specifies, among other 
matters, that BX will terminate its responsibility for fulfilling 
certain obligations and cease performing certain regulatory functions 
as of the effective date of June 1, 2012, or sooner if BOX satisfies 
all of the conditions required for BOX to operate as a national 
securities exchange (``the facility termination effective date'').\5\ 
As proposed, the BOX Trading Rules will no longer be operative to 
permit options trading on BX as of the facility termination effective 
date. If BOX meets the requirements and operates as an exchange, it 
will be a self-regulatory organization responsible for the activities 
occurring on BOX after the facility termination effective date. BX is 
not the Designated Options Examining Authority (``DOEA'') for any BOX 
Options Participant.
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    \4\ Currently, BOX is a facility of the Exchange under Section 
3(a)(2) of the Act. See Securities Exchange Act Release Nos. 49066 
(January 13, 2004), 69 FR 2773 (January 20, 2004) (SR-BSE-2003-17); 
49065 (January 13, 2004), 69 FR 2768 (January 20, 2004) (SR-BSE-
2003-04) (``BOXR Order''); and 49068 (January 13, 2004), 69 FR 2775 
(January 20, 2004) (SR-BSE-2002-15). See also Release No. 34-58324; 
73 FR 46936 (August 7, 2008) (File Nos. SR-BSE-2008-02; SR-BSE-2008-
23; SR-BSE-2008-25; SR-BSECC-2008-01) (``Order approving the 
Acquisition of the Boston Stock Exchange, Incorporated by The NASDAQ 
OMX Group, Inc.'').
    \5\ BOX has filed an application with the Commission for 
registration as a national securities exchange under Section 6 of 
Act. See Securities Exchange Act Release No. 66242 (January 26, 
2012), 77 FR 4841 (January 31, 2012). The application has been 
granted and is conditioned on the satisfaction of certain 
requirements. See Securities Exchange Act Release No. 66871 (April 
27, 2012), 77 FR 86 (May 3, 2012).
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    BX will continue to have certain responsibility for the trading 
activities and the actions of the BOX Options Participants for the time 
period during which BOX was operating as a facility of the Exchange 
(``BOX legacy matters'').\6\ BX has always retained the ultimate 
authority and responsibility for the rules and regulations and the 
activities of the BOX facility. However, BX had delegated to BOXR the 
authority to act on behalf of the Exchange regarding regulatory matters 
relating to the BOX facility. The sole purpose of BOXR has been to 
regulate the BOX facility. As such, after BOX ceases to be a facility 
of the Exchange, the delegation of regulatory authority to BOXR will be 
terminated and BX will retain all such responsibilities for BOX legacy 
matters. Currently, for matters pertaining to BOX Options Participants, 
BOXR utilizes procedural rules regarding discipline and arbitration 
found in the ``Grandfathered Rules,'' which will be defined below. As 
proposed, rather than have two sets of procedural rules for discipline 
and arbitration, BX will utilize the procedural rules governing 
disciplinary matters and arbitrations which currently exist in the BX 
Rules \7\ and are used for the Equity market. Currently, there are no 
formal disciplinary proceedings or arbitrations pending against BOX 
Options Participants.\8\ As such, there is no need for temporary rules 
to be implemented.\9\ All formal proceedings, if any are commenced, 
will utilize the new procedural rules.
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    \6\ For example, potential BOX legacy matters may include 
disciplinary matters and arbitrations.
    \7\ These Rules are also known as the Equity Rules. The 
definition of Equity Rules is found at BX Rule 0120(p).
    \8\ Currently, formal proceedings are commenced by a notice of 
specific charges set forth in a charge memorandum. See current 
Grandfathered Rules, Chapter XXX, Section 2(a). See also BX Rule 
9211. A disciplinary proceeding shall begin when the complaint is 
served and filed. Although there are currently no formal proceedings 
that have been commenced, there is one Options Participant reviewing 
a Letter of Acceptance, Waiver and Consent. See Chapter XXX, Section 
10 and Chapter XXXIV.
    \9\ Compare to American Stock Exchange (``AMEX''), which 
implemented temporary rules to avoid potential confusion to 
respondents where formal proceedings had commenced by AMEX and were 
still pending at the Transaction date, on which date new procedural 
disciplinary rules were to be effective. See Securities Exchange Act 
Release Nos. 58286 (August 1, 2008), 73 FR 46097 (August 7, 2008); 
and 35678 (September 29, 2008), 73 FR 57705 (October 3, 2008) (SR-
Amex-2008-64) (``Amex Proposal'').
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    These proposed changes are not intended to change any underlying 
rules, rather these proposed changes and the reliance on existing BX 
Rules are intended to permit the use of BX's current discipline and 
arbitration procedures for BOX legacy matters. These procedures are 
substantially similar to those in the Grandfathered Rules. These BX 
disciplinary procedures provide fair procedures for the discipline of 
the former BOX Options Participants and persons who were associated 
persons of former BOX Options Participants and for arbitration 
proceedings stemming from activities which occurred while BOX was a 
facility of the Exchange.
    There are also some amendments updating outdated references. 
Finally, references to BOX and BOX related matters (i.e. BOX, BOXR) 
which are no longer needed in the BX By-Laws and Rules, once BOX is no 
longer a facility of the Exchange, are being removed. For these 
reasons, as will be explained more fully below, BX proposes to amend 
the Grandfathered Rules and the BOX Trading Rules, and to remove the 
BOXR By-Laws and BOXR Operating Agreement, in their entirety, and the 
BX By-Laws, the BX Rules, with an effective date of the facility 
termination effective date.
Grandfathered Rules
    First, BX is proposing to amend the ``Grandfathered Rules.'' The 
Grandfathered Rules are the Rules of Board of Governors of the Boston 
Stock Exchange as in effect on the date of the closing of the 
acquisition of the Exchange by The NASDAQ OMX Group, Inc. Currently, as 
set forth in BX Rules 0210(r), the Grandfathered Rules are operative to 
the extent that such rules are applicable to BOX and to Options 
Participants and to activities of members, members organizations, 
persons associated with members, and other persons subject to the 
jurisdiction of the Exchange that occurred prior to the adoption of the 
Equity Rules. As proposed, the Grandfathered Rules will be amended, as 
explained below, to apply to the activities of BOX and the BOX Options 
Participants and associated persons subject to the jurisdiction of the 
Exchange. These rules, however, will not be operative to permit 
trading.
    The Grandfathered Rules currently consist of two sections: The 
Provisions of the Former Constitution of the Boston Stock Exchange, 
Inc. That Have Been Incorporated Into the Grandfathered Rules; and the 
Rules of the Board of Governors. A heading will be added to refer to 
these as the Grandfathered BSE Rules. As will be described more fully 
below, BX also proposes to incorporate the BOX Trading Rules, as 
amended in the manner described below, (``The Grandfathered BOX 
Rules'') into the Grandfathered Rules. For this new third section, a 
heading will be added to refer to these as the Grandfathered Trading 
Rules of the Boston Options Exchange Group, LLC. The Grandfathered 
Rules will remain posted on the BX Web site.

[[Page 30568]]

    The opening explanatory paragraph to the Grandfathered Rules is 
being amended to reflect that the rules apply to activities of former 
BOX Options Participants and associated persons subject to the 
jurisdiction of the Exchange; in addition, the rules continue to apply 
to activities of members, members organizations, persons associated 
with members, and other persons subject to the jurisdiction of the 
Exchange that occurred prior to the adoption of the post-acquisition 
Equity Rules. In Chapter I, Section I, BX is also clarifying that 
references to the Board of Governors, where appropriate for the 
affected rules, mean the Board of Directors of the Exchange and that 
references to the Constitution shall mean the BX By-Laws where 
applicable. There are also references to the Constitution that will be 
renamed as ``Incorporated Constitution Provision'' to refer to the 
provisions of the Former Constitution which were incorporated into the 
Grandfathered Rules.\10\ As proposed, in other sections where there is 
an applicable rule with a reference to a specific provision of the 
former Constitution, sections will be amended to replace the term 
Constitution with the term BX By-Laws. For example, Chapter II, 
Sections 14 and 25 have references to penalties provided for in Article 
XIV, Section 4 of the Constitution. Article XIV, Section 4 was not 
incorporated into the rules, as the By-Laws replaced this section of 
the former Constitution; this section will now reflect that penalties 
are provided for in the BX By-Laws. These amendments do not 
substantially alter the rules in their current format, but rather 
provide the correct reference.
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    \10\ See e.g., Chapter XXXIII, Section 7 regarding BEACON 
Liability.
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    Chapter IA is being removed, because, as noted above and discussed 
in more detail in the paragraph below, the procedural rules for 
disciplinary proceedings will be the current BX Rule 9000 Series. 
Similarly, Section 4 (Imposition of Fines for Minor Violation(s) of 
Rule and Floor Decorum Policies) of Chapter XVIII (Conduct) is being 
amended to reflect that Chapter XXX is being removed, as described 
below, as proceedings involving discipline will be governed by the BX 
Rule 9000 Series. In particular, in subsection (a), it will be 
referenced that BX Rule 9216 governs when BX imposes a fine for a minor 
rule violation. Sections 4(b) through (d) and 4(f) are being removed as 
they relate to disciplinary proceedings, which, as proposed, will be 
governed by the BX Rule 9000 Series. In addition, a cross reference to 
the Grandfathered BOX Rules Chapter X, Section 2 is being added to note 
that it will provide for rule violations that may be considered minor 
in nature. Section 4(e) is being removed as unnecessary, because it is 
almost identical to Chapter X, Section 2(e) of the current BOX Trading 
Rules and proposed Grandfathered BOX Rules. Grandfathered Chapter 
XVIII, Section 6 is being removed as is it no longer applicable.
    BX is proposing to remove Chapter XXX, Disciplining Members, Denial 
of Membership. The Principal Considerations in Determining Sanctions 
found in Chapter XXX have been incorporated in the BOXR Sanctioning 
Guidelines.\11\ BX will continue to follow the Guidelines. The 
remainder of Chapter XXX sets forth the procedural rules to be followed 
for disciplining members. As proposed, in its place, BX will utilize 
the 9000 Series of the BX Rules,\12\ which is the Code of Procedure 
that sets forth the rules regarding disciplining a member or person 
associated with a member and will now govern the disciplinary process 
for any legacy disciplinary matter. Under Chapter XXX, an explanatory 
sentence is being added stating the 9000 Series of BX Rules will now 
govern the disciplinary process. BX is removing Chapter XXXII regarding 
Arbitration Rules from the Grandfathered Rules because it has proposed 
utilizing the BX 10000 Series, which is the Code of Arbitration 
Procedure. As proposed, in its place will be a sentence that reflects 
that arbitrations will be governed by the BX 10000 Series.
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    \11\ The BOXR Sanctioning Guidelines are not set forth in the 
rules, but are part of the policies and procedures that are followed 
once a determination has been made that sanctions are to be imposed.
    \12\ Not every section of these procedures may apply to former 
BOX Participants. For example, because there will be no on-going 
activities, there may be no reason for a former BOX Participant to 
avail itself of the 9600 Series regarding exemptions.
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    Chapter XXXIV (Minor Rule Violations) is being amended to add a 
reference to Chapter X of the proposed, Grandfathered BOX Trading 
Rules. This section provides for rule violations deemed minor in 
nature. In addition, for the reasons noted above, references to the 
9000 Series governing discipline and BX Rule 9216 regarding Acceptance, 
Waiver and Consent are being amended, as appropriate.
    BX is terminating its delegation of authority to BOXR, and as such 
is proposing to remove the Delegation of Authority language from the 
Grandfathered Rules. Chapter XXXVI of the Grandfathered Rules sets 
forth the Rules under which BX has granted BOXR authority to carry out 
certain regulatory responsibilities over the BOX facility. BX has 
always retained the ultimate regulatory responsibility for the 
oversight of the BOX facility with oversight conducted by BX's 
Regulatory Oversight Committee. For any BOX legacy matter, all 
regulatory responsibilities will be carried out in the manner set forth 
in the BX By-Laws and the BX Rules, and with continued oversight by the 
BX Regulatory Oversight Committee. Finally, Chapter XXXIX, Affiliation 
with NASDAQ OMX Group, Inc., Section 2(c) is being removed, as BOX will 
no longer be a facility of the Exchange.
BOX Trading Rules
    BX also proposes to incorporate the Trading Rules of the Boston 
Options Exchange Group LLC, with the amendments described below, (``BOX 
Trading Rules'') into the Grandfathered Rules and locate them at end of 
current Grandfathered Rules by creating a new section of the 
Grandfathered Rules called Grandfathered BOX Trading Rules. As stated 
above, these rules apply to activities of the BOX Options Participants 
and associated persons subject to the jurisdiction of the Exchange, 
during the time period that BOX was a facility of the Exchange. As 
proposed, a new paragraph will be added to the Grandfathered BOX 
Trading Rules section, before the General Provisions, to set forth that 
BOX is no longer a facility of the Exchange. These Grandfathered BOX 
Trading Rules and the applicable Grandfathered BSE Rules continue to 
apply to the activities of BOX and Options Participants and associated 
persons subject to the jurisdiction of the Exchange that occurred 
during the time that BOX was a facility of the Exchange. Terms below 
must be read in context regarding activities which occurred when BOX 
was a facility of the Exchange and also regarding activities relating 
to continued Exchange jurisdiction, such as disciplinary matters.
    As proposed, certain definitions found in Section 1 of the 
Grandfathered BOX Trading Rules will be amended to reflect that BOX is 
no longer a facility of the Exchange: (6) The term ``BOX'' will mean 
the Boston Options Exchange or Boston Stock Exchange Options Exchange, 
formerly an options trading facility of the Exchange under Section 
3(a)(2) of the Act; (7) the term ``BOX Rules'' or ``Rules of BOX'' will 
mean the Rules of the former Boston Options Exchange Facility. Where 
applicable, it may mean Grandfathered BOX Rules, in

[[Page 30569]]

context, but it may also mean the rules in place while BOX was a 
facility of the Exchange; (9) the term ``BOXR'' or ``BOX Regulation'' 
will mean Boston Options Exchange Regulation LLC, which was a wholly-
owned subsidiary of the Exchange; where applicable for the 
Grandfathered BOX Rules, it may mean the Exchange; (10) the term ``BSE 
Rules'' will mean the Grandfathered Rules; (24) the term ``Exchange'' 
will mean the Boston Stock Exchange, now known as NASDAQ OMX BX, Inc.; 
(42) the term ``Options Participant'' or ``Participant'' or ``Former 
BOX Options Participant'' is being amended to reflect that the 
Participants were registered with the Exchange pursuant to the BOX 
Trading Rules; (61) the term ``Rules of the Exchange'' will mean the BX 
By-Laws, where applicable, the BX Rules and the Grandfathered Rules, 
including these Grandfathered BOX Rules.
    Prior to being granted BOX Options Participant status, by executing 
the Options Market Participation Agreement, every Participant 
acknowledged that the Participant and its associated persons are 
subject to the oversight and jurisdiction of the Exchange. Rather than 
solely relying upon an open ended contractual jurisdiction provision, 
as proposed Chapter II, Section I (h) is being added to codify that 
acknowledgment in the Rules and add a two year provision for filing a 
complaint that is similar to that set forth in the BX Rules, providing 
as follows: ``A Participant or an person associated with a Participant 
that has had its Participant status terminated or revoked shall 
continue to be subject to the filing of a complaint under these Rules 
based upon conduct that commenced prior to the effective date of the 
Participant's termination of its Participation. Any such complaint, 
however, shall be filed within two years after the effective date of 
resignation, cancellation, or revocation.'' This provision is similar 
to that found in BX Rules 1012 and 1031.
    Outdated references to the specific sections of the Constitution 
that are unnecessary are being removed. To avoid confusion, now that 
certain sections of the BX Rules are being relied upon, certain 
references to the ``Rules of the Exchange'' will be referred to as the 
BSE Rules. For the reasons described above, references to Grandfathered 
BSE Chapter XXX will be removed and instead the BX Rule 9000 Series 
will apply.\13\ References to Grandfathered BSE Rules, Chapter XXX in 
proposed Grandfathered BOX Trading Rules, Chapter X, Section 1, 
regarding the procedures to be followed for imposing a Minor Rule 
Violation Plan fine will be replaced by BX Rule 9216, and, where 
appropriate, BX Rule 9000 Series, which will govern this process going 
forward. The Minor Rule Violation penalties and the references to 
underlying Grandfathered BOX Trading Rules governed by the Minor Rule 
Violation Plan will remain in the proposed Grandfathered BOX Trading 
Rules, Chapter X, Section 2 and will not be added into the BX Rules. 
Similarly, procedures to be followed for letters of Acceptance, Waiver 
and Consent will be set forth in BX Rule 9216; therefore, the section 
regarding Acceptance, Waiver and Consent procedures found in 
Grandfathered BOX Trading Rules, Chapter X, Section 3 is being removed. 
In addition, the Appendix is being amended to reflect that BOX will no 
longer be facility of the Exchange, to remove outdated references to 
the former Constitution, to refer to the the former Incorporated 
Constitution Provisions where appropriate, and to reflect that the 
disciplinary and arbitration procedures will be found in the 9000 and 
1000 Series of the BX Rules.
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    \13\ See Proposed Grandfathered BOX Trading Rules, Chapter III, 
Sections 8(c) and 13, Chapter VI, Section 4, and Chapter VIII, 
Section 5.
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BOXR Operating Agreement and BOXR By-Laws
    BX is proposing to eliminate the BOXR By-Laws and Operating 
Agreement in their entirety. As stated above, once BOX ceases to be a 
facility of the Exchange, BOXR will no longer have a purpose, as BOXR's 
sole purpose was to regulate the BOX facility. BOXR LLC will be merged 
into its parent, BX.
NASDAQ OMX BX Rules and By-Laws
    In addition, BX proposes to amend the Rules of BX. Specifically, 
Rule 0015 (b) provides that the Options Rules (including the 
Grandfathered Rules) shall apply to all Options Participants, and will 
be amended to: (i) Remove the reference to Options Rules as there will 
no longer be a set of rules called Options Rules; (ii) reflect that the 
9000 Series and the 10000 Series of these Rules (meaning the BX Rules) 
and the Grandfathered Rules shall apply to former BOX Options 
Participants and associated persons for activities that occurred during 
the time that BOX was a facility of the Exchange; and (iii) remove the 
provision that ``[t]he Equity Rules shall apply to Options Participants 
only if they are also members of the Exchange,'' because, as will be 
explained below, as proposed, the term Options Participant is being 
removed from the rules.
    As proposed, the following definitions found in Rule 0120 will be 
amended. Specifically, Definition (q) ``Options Rules'' will be 
reserved. Definition (r) ``Grandfathered Rules'' will be amended to 
mean the Rules of the Board of Governors of the Boston Stock Exchange, 
as in effect on the date of the closing of the acquisition of the 
Exchange by The NASDAQ OMX Group, Inc. and as such rules may be 
subsequently amended, to the extent that such rules are applicable to 
BOX and to Options Participants that occurred while BOX was a facility 
of the Exchange. The Grandfathered Rules shall also apply to activities 
of members, members organizations, persons associated with members, and 
other persons subject to the jurisdiction of the Exchange that occurred 
prior to the adoption of the Equity Rules. Definitions (s) Options 
Participant, (t) BOXR, (u) BOX LLC, (v) BOX and (w) BOX Rules will be 
reserved, because BOX will no longer be a facility of the Exchange. 
Similarly, as proposed, Article I of the BX By-Laws will be amended to 
reflect that BOX will no longer be a facility of the Exchange. 
Specifically, Sections (d) through (h) will now be reserved, as these 
definitions are no longer needed once BOX ceases to be a facility of 
BX. Section 4.3(a) regarding qualifications for the Board of Directors 
will be amended to remove the requirement that one Industry Director 
shall represent BOX Participants as that is no longer needed. 
Subsection (b) will be removed as it references actions which occurred 
after the adoption of the By-Laws after the NASDAQ OMX Group, Inc. 
acquired the Boston Stock Exchange. Finally, Section 4.14, Committees 
Not Composed Solely of Directors, will be amended to remove the manner 
in which an Industry Director who is a representative of BOX 
Participants is nominated to the Board as it is no longer needed.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act,\14\ in general, and Section 
6(b)(5) of the Act,\15\ in particular, in that it is designed to 
promote just and equitable principles of trade, 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

[[Page 30570]]

and open market and a national market system and, in general, to 
protect investors and the public interest. Further, BX believes that 
the proposal is consistent with Sections 6(b)(1) of the Act, which 
requires, among other things, that a national securities exchange be so 
organized and have the capacity to carry out the purposes of the Act, 
and to comply and enforce compliance by its members and persons 
associated with its members, with the provisions of the Act, the rules 
and regulation thereunder, and the rules of the exchange. Specifically, 
the proposal is intended to address the relationship between BX and the 
former BOX Participants that will exist for BOX legacy matters once BOX 
is no longer a facility of BX. The disciplinary procedures provide for 
fair procedures for the discipline of the former BOX Participants and 
persons who were associated persons of former BOX Participants for 
activities which occurred while BOX was a facility of the Exchange, 
consistent with Section 6(b)(7) of the Act.\16\ BX believes that with 
the removal of the BOX-related provisions the composition and selection 
of the BX Board of Directors will continue to satisfy the requirement 
in Section 6(b)(3) of the Act \17\ that the rules of the Exchange 
provide for the fair representation of members in the selection of 
directors and administration of the Exchange.
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    \14\ 15 U.S.C. 78f(b).
    \15\ 15 U.S.C. 78f(b)(5).
    \16\ 15 U.S.C. 78f(b)(7).
    \17\ 15 U.S.C. 78f(b)(7).
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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

    No written comments were either solicited or received.

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) \18\ of the Act and Rule 19b-4(f)(6) \19\ thereunder. The 
proposed rule change effects a change that (A) does not significantly 
affect the protection of investors or the public interest; (B) does not 
impose any significant burden on competition; and (C) by its terms, 
does not become operative for 30 days after the date of the filing, or 
such shorter time as the Commission may designate if consistent with 
the protection of investors and the public interest; provided that the 
self-regulatory organization has given the Commission 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.\20\
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    \18\ 15 U.S.C. 78s(b)(3)(A).
    \19\ 17 CFR 240.19b-4(f)(6).
    \20\ 17 CFR 240.19b-4(f)(6)(iii). BX provided the Commission 
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 on which the Exchange 
filed the proposed rule change, or such shorter time as designated 
by the Commission.
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    The Exchange has requested that the Commission waive the 30-day 
operative delay so that the proposal may become operative upon the 
facility termination effective date. The Exchange believes that it will 
avoid potential confusion for BOX Options Participants that may result 
from a new set of rules pertaining to the new BOX Exchange, to have to 
the changes described above in effect on the facility termination 
effective date.
    Because the new BOX Exchange is now operating as a national 
securities exchange and BOX is now a facility of the new BOX Exchange 
and not of BX,\21\ the Commission believes it is consistent with the 
protection of investors and the public interest to waive the 30-day 
operative delay, and allow the Exchange to reflect this change in its 
rules on the facility termination effective date.\22\
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    \21\ See supra note 5. The new BOX Exchange became operational 
on May 14, 2012.
    \22\ For the purposes only of waiving the operative date of this 
proposal, 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 such 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.

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-BX-2012-036 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-2012-036. 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 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 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-BX-2012-036 and should be 
submitted on or before June 13, 2012.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\23\
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    \23\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-12441 Filed 5-22-12; 8:45 am]
BILLING CODE 8011-01-P


