[Federal Register Volume 77, Number 180 (Monday, September 17, 2012)]
[Notices]
[Pages 57169-57171]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-22789]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-67830; File No. SR-Phlx-2012-112]
Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Relating to
Rebates and Fees for Adding and Removing Liquidity in Select Symbols
September 11, 2012.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\, and Rule 19b-4 \2\ thereunder, notice is hereby given
that, on August 31, 2012, NASDAQ OMX PHLX LLC (``Phlx'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I, II and III below, which Items have been
[[Page 57170]]
prepared by the Exchange. 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.
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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 Exchange's Pricing Schedule at
Section I titled ``Rebates and Fees for Adding and Removing Liquidity
in Select Symbols.'' \3\ Specifically, the Exchange proposes to amend
certain Simple Order Fees for Removing Liquidity. The Exchange also
proposes various technical amendments to the Pricing Schedule.
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\3\ The rebates and fees in Section I apply to certain Select
Symbols which are listed in Section I of the Pricing Schedule.
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While changes to the Pricing Schedule pursuant to this proposal are
effective upon filing, the Exchange has designated the proposed
amendment to be operative on September 4, 2012.
The text of the proposed rule change is available on the Exchange's
Web site at http://www.nasdaqtrader.com/micro.aspx?id=PHLXfilings, at
the principal office of the Exchange, 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 purpose of the proposed rule change is to amend Section I of
the Exchange's Pricing Schedule. Specifically, the Exchange is
proposing to amend Section I of the Pricing Schedule to increase
certain Simple Order Fees for Removing Liquidity. Despite the increase
to these fees, the Exchange believes that the fees remain competitive
with fees assessed by other options exchanges.
The Exchange is also proposing to make technical amendments to
Section I of the Pricing Schedule.
The Exchange is proposing to amend Section I, Part A of the Pricing
Schedule to increase the Simple Order Fees for Removing Liquidity for
Customers from $0.39 per contract to $0.43 per contract and increase
the Simple Order Fees for Removing Liquidity for Specialists \4\ and
Market Makers \5\ from $0.39 to $0.45 per contract.
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\4\ A Specialist is an Exchange member who is registered as an
options specialist pursuant to Rule 1020(a).
\5\ A ``Market Maker'' includes Registered Options Traders
(``ROTs'') (Rule 1014(b)(i) and (ii), which include Streaming Quote
Traders (``SQTs'') (See Rule 1014(b)(ii)(A)) and Remote Streaming
Quote Traders (``RSQTs'') (See Rule 1014(b)(ii)(B)).
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Also, the Exchange is proposing to make technical corrections in
Section I, Part A by replacing ``$0.00'' with ``N/A'' for several
categories. This is not a change to these fees, but a technical
amendment since in these instances ``N/A'' better reflects that a fee
is not relevant for this category rather than ``$0.00'' which simply
reflects that no fee is currently being charged for this category.
2. Statutory Basis
The Exchange believes that its proposal to amend its Pricing
Schedule is consistent with Section 6(b) of the Act \6\ in general, and
furthers the objectives of Section 6(b)(4) of the Act \7\ in
particular, in that it is an equitable allocation of reasonable fees
and other charges among Exchange members and other persons using its
facilities.
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\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(4).
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The Exchange believes that its proposal to increase the Simple
Order Fees for Removing Liquidity for Customers, from $0.39 to $0.43
per contract, and the Simple Order Fees for Removing Liquidity for
Specialists and Market Makers, from $0.39 to $0.45 per contract, is
reasonable because the increases remain competitive with fees assessed
by other options exchanges.\8\
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\8\ NYSE Arca, Inc. assesses Customers, Firms, Broker-Dealers
and Market Makers a $0.45 take fee. See NYSE Arca, Inc.'s Fee
Schedule.
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The Exchange believes that its proposal to increase the Simple
Order Fees for Removing Liquidity for Customers, Specialists and Market
Makers is equitable and not unfairly discriminatory because the
Exchange would assess all market participants, except Customers, a
$0.45 per contract Simple Order Fee for Removing Liquidity. The
Exchange proposes to assess a lower Simple Order Fee for Removing
Liquidity to Customers of $0.43 per contract as compared to $0.45 per
contract for all other market participants because Customer order flow
enhances liquidity on the Exchange for the benefit of all market
participants.
The Exchange believes that the technical amendments proposed to
Section II, Part A are reasonable, equitable and not unfairly
discriminatory because the amendments are not substantive but rather
technical amendments to provide more detail in the Pricing Schedule for
greater clarity.
The Exchange operates in a highly competitive market, comprised of
ten exchanges, in which market participants can easily and readily
direct order flow to competing venues if they deem fee levels at a
particular venue to be excessive or rebates to be inadequate.
Accordingly, the fees that are assessed and the rebates paid by the
Exchange must remain competitive with fees charged and rebates paid by
other venues and therefore must continue to be reasonable and equitably
allocated to those members that opt to direct orders to the Exchange
rather than competing venues.
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)(ii) of the Act.\9\ 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. If the Commission takes such action, the Commission shall
institute proceedings to determine whether the proposed rule should be
approved or disapproved.
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\9\ 15 U.S.C. 78s(b)(3)(A)(ii).
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[[Page 57171]]
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 [email protected]. Please include
File Number SR-Phlx-2012-112 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-Phlx-2012-112. 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-Phlx-2012-112 and should be
submitted on or before October 9, 2012
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-22789 Filed 9-14-12; 8:45 am]
BILLING CODE 8011-01-P