[Federal Register Volume 76, Number 90 (Tuesday, May 10, 2011)]
[Notices]
[Pages 27117-27118]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-11313]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-64390; File No. SR-C2-2011-011]
Self-Regulatory Organizations; C2 Options Exchange, Incorporated;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend the C2 Fees Schedule
May 4, 2011.
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 April 29, 2011, C2 Options Exchange, Incorporated (the ``Exchange''
or ``C2'') 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 has designated this proposal as one establishing or changing a
due, fee, or other charge imposed by the Exchange under Section
19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder.\4\ 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
C2 proposes to amend its Fees Schedule. The text of the proposed
rule change is available on the Exchange's Web site (http://www.c2exchange.com), at the Exchange's Office of the Secretary and at
the Commission.
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
C2 proposes to amend its Fee Schedule to revise its transaction
fees for all multiply-listed, equity and exchange-traded fund (``ETF'')
option classes traded on C2. Currently, transactions fees as set out in
the Fees Schedule under two categories: (i) Transaction fees for option
classes C, BAC, XLF, F, and SPY; \5\ and (ii) transaction fees for all
other multiply-listed, equity and ETF option classes.\6\
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\5\ For C, BAC, XLF, F, and SPY, the transaction fees are
currently as follows: public customers do not receive a maker rebate
and pay a liquidity removing taker rate of $.25 per contract; C2
Market-Makers receive a liquidity making rebate of $.25 per contract
and pay a liquidity removing taker rate of $.34 per contract; and
all other users receive a liquidity making rebate of $.10 per
contract and pay a liquidity removing taker rate of $.34 per
contract. There are no taker fees or maker credits for trades
executed as part of the open for these classes.
\6\ For all other multiply-listed, equity and ETF option
classes, the transaction fees are currently as follows: Public
customers do not receive a maker rebate and pay a liquidity removing
taker rate of $.15 per contract; C2 Market-Makers receive a
liquidity making rebate of $.15 per contract and pay a liquidity
removing taker rate of $.25 per contract; and all other users
receive a liquidity making rebate of $.10 per contract and pay a
liquidity removing taker rate of $.40 per contract. There are no
taker fees or maker credits for trades executed as part of the open
for these classes.
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The transaction fees will be simplified to have only a single
category for all multiply-listed, equity and ETF option classes. Within
that category, the transaction fees will be structured as follows:
Public customers will receive a liquidity making rebate of $.22 per
contract and will pay a liquidity removing taker rate of $.25 per
contract; C2 Market-Makers will receive a liquidity making rebate of
$.25 per contract and will pay a liquidity removing taker rate of $.33
per contract; and all other users will receive a liquidity making
rebate of $.22 per contract and will pay a liquidity removing taker
rate of $.33 per contract. As is currently the case, there will
continue to be no maker credits or taker fees for trades executed as
part of the open for these classes. Finally, we note that the Exchange
is making a non-substantive amendment to reorganize the text of the
Fees Schedule (the sequence of the liquidity making rebate and
liquidity removing taker rate columns in the Fees Schedule are being
flip-flipped). The change will be effective on May 2, 2011.
[[Page 27118]]
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the
Act,\7\ in general, and furthers the objectives of Section 6(b)(4) \8\
of the Act in particular, in that it is designed to provide for the
equitable allocation of reasonable dues, fees, and other charges among
C2 Trading Permit Holders and other persons using Exchange facilities.
The Exchange believes that modifying the C2 transaction fee rates so
that the rebate and charge levels are more closely aligned between
participant types is consistent with: (i) Section 6(b)(4) of the Act in
that it represents an equitable allocation of fees; and (ii) Section
6(b)(5) of the Act in that the modifications are not designed to
unfairly discriminate between customers, brokers, or dealers. The
Exchange believes that the preferred customer fee is consistent with
the long history in the options markets of customers being given
preferred fees and that the Market-Maker rebate is reflective of the
fact that Market-Makers have affirmative obligations to enhance market
quality and can be rewarded for their commitments through advantaged
pricing.
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\7\ 15 U.S.C. 78f(b).
\8\ 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 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 proposed rule change is designated by the Exchange as
establishing or changing a due, fee, or other charge, thereby
qualifying for effectiveness on filing pursuant to Section
19(b)(3)(A)(ii) of the Act \9\ and subparagraph (f)(2) of Rule 19b-4
\10\ thereunder.
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\9\ 15 U.S.C. 78s(b)(3)(A)(ii).
\10\ 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 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 e-mail to [email protected]. Please include
File Number SR-C2-2011-011 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-C2-2011-011. 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 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-C2-2011-011 and should be
submitted on or before May 31, 2011.
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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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-11313 Filed 5-9-11; 8:45 am]
BILLING CODE 8011-01-P