[Federal Register: September 5, 2007 (Volume 72, Number 171)]
[Notices]
[Page 50996-50997]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05se07-82]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-56331; File No. SR-Amex-2007-93]
Self-Regulatory Organizations; American Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
Relating to the Options Directed Order Participant Transaction Charge
Rebate Program
August 28, 2007.
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 August 20, 2007, the American Stock Exchange LLC (``Amex'' or
``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 substantially prepared by the
Exchange. Amex has designated this proposal as one establishing or
changing a due, fee, or other charge imposed by Amex under Section
19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\
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\ 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
The Exchange proposes to extend the transaction charge rebates
currently applicable to supplemental registered options traders
(``SROTs'') to all Directed Order Participants. The text of the
proposed rule change is available at the Exchange, the Commission's
Public Reference Room, and http://www.amex.com.
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. Amex has substantially 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 Exchange proposes to extend the options transaction charge \5\
rebates currently applicable to SROTs \6\ to all Directed Order
Participants (including SROTs) that provide liquidity to the Exchange
and receive electronic directed customer orders (the ``Directed Order
Fee Rebate Program''). This Directed Order Fee Rebate Program would
provide fee rebates to Directed Order Participants that provide order
flow to the Exchange from an order flow provider firm.\7\
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\5\ The options transaction charge is the collective of the
Options Transaction Fee, the Options Comparison Fee, and the Options
Floor Brokerage fee, as noted on the Options Fee Schedule.
\6\ See Securities Exchange Act Release No. 56002 (July 2,
2007), 72 FR 37548 (July 10, 2007) (SR-Amex 2007-55).
\7\ See Securities Exchange Act Release No. 56269 (August 15,
2007), 72 FR 47086 (August 22, 2007) (Notice of Filing and Order
Granting Accelerated Approval of SR-Amex 2007-75). Generally, for
purposes of the Directed Order Flow Program, a directed order is
deemed to be an electronic customer order from an order flow
provider that is directed to a specific specialist, registered
options trader (``ROT''), SROT, or remote registered options trader
(``RROT'').
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This proposal would allow the Exchange to provide Directed Order
Participants with options transaction charge rebates for the number of
options contracts that are electronically directed to them and executed
on the Exchange. The following rebate schedule is proposed:
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Rebate per
Monthly directed order volume (in contracts) contract
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0-1,000,000................................................ $0.05
1,000,001-2,000,000........................................ .10
2,000,001-3,000,000........................................ .125
3,000,001 and up........................................... .15
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Rebates would be capped at 100% of transaction charges so that once
a Directed Order Participant's transaction charges reach zero, the
Exchange would not pay out any additional credits.\8\
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\8\ For example, a Directed Order Participant which pays
$100,000 in transaction charges per month, could not receive more
than a $100,000 rebate.
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The Exchange notes that Directed Order Participants are entitled to
the options transaction charge rebate, which is separate and apart from
the Exchange's Payment for Order Flow Plan.\9\ The proposed options
transaction charge rebate, which is provided to Directed Order
Participants, will not come from the marketing fees collected on those
transactions.
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\9\ See supra note 7.
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act \10\ in general, and Section 6(b)(4) of
the Act \11\ in particular, in that it is designed to provide for an
equitable allocation of reasonable dues, fees, and other charges among
exchange members and other persons using exchange facilities.
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\10\ 15 U.S.C. 78f(b).
\11\ 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 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 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 proposed rule change has been designated as a fee
change pursuant to Section 19(b)(3)(A)(ii) of the Act \12\ and Rule
19b-4(f)(2) \13\ thereunder, because it establishes or changes a due,
fee, or other charge imposed by the Exchange. Accordingly, the proposal
will take effect upon filing with the Commission. At any time within 60
days of the filing of such 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.
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\12\ 15 U.S.C. 78s(b)(3)(A)(ii).
\13\ 17 CFR 240.19b-4(f)(2).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing,
[[Page 50997]]
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-Amex-2007-93 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-Amex-2007-93. 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-Amex-2007-93 and should be
submitted on or before September 26, 2007.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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Nancy M. Morris,
Secretary.
[FR Doc. E7-17479 Filed 9-4-07; 8:45 am]
BILLING CODE 8010-01-P