[Federal Register: March 6, 2008 (Volume 73, Number 45)]
[Notices]
[Page 12238-12240]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06mr08-117]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-57397; File No. SR-ISE-2008-13]
Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change Relating to Fee Changes
February 28, 2008.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on February 11, 2008, the International Securities Exchange, LLC
(``ISE'' 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 ISE. The ISE has designated this proposal as one
establishing or changing a due, fee, or other charge applicable only to
a member 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 ISE is proposing to amend its Schedule of Fees to establish
fees for transactions in options on five Premium Products.\5\ The text
of the proposed rule change is available at the ISE, at the
[[Page 12239]]
Commission's Public Reference Room, and on the ISE's Web site (http://
www.iseoptions.com/legal/proposed_rule_changes.asp).
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\5\ ``Premium Products'' is defined in the Schedule of Fees as
the products enumerated therein.
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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 ISE 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 ISE 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 Exchange is proposing to amend its Schedule of Fees to
establish fees for transactions in options on the UltraShort FTSE/
Xinhua China 25 ProShares (``FXP''),\6\ UltraShort MSCI Emerging
Markets ProShares (``EEV''),\7\ iShares Russell 1000 Growth Index Fund
(``IWF''),\8\ SPDR S&P Retail Select ETF (``XRT''),\9\ and The Market
Vectors--Agribusiness ETF (``MOO'').\10\ The Exchange represents that
FXP, EEV, IWF, XRT and MOO are eligible for options trading because
they constitute ``Exchange-Traded Fund Shares,'' as defined by ISE Rule
502(h).
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\6\ ``FTSE[supreg]'' is a trademark jointly owned by the London
Stock Exchange PLC and The Financial Times Limited and is used by
FTSE/Xinhua Index Limited (``FXI'') under license. ``Xinhua(r)'' is
a trademark of Xinhua Finance Limited and is used by FXI under
license. All other trademarks and service marks are the property of
their respective owners. The UltraShort FTSE/Xinhua China 25
ProShares (``FXP'') are not sponsored, endorsed, issued, sold or
promoted by FXI. FXI has not licensed or authorized ISE to (i)
engage in the creation, listing, provision of a market for trading,
marketing, and promotion of options on FXP or (ii) to use and refer
to any of their trademarks or service marks in connection with the
listing, provision of a market for trading, marketing, and promotion
of options on FXP or with making disclosures concerning options on
FXP under any applicable federal or state laws, rules or
regulations. FXI does not sponsor, endorse, or promote such activity
by ISE and is not affiliated in any manner with ISE.
\7\ ``MSCI Emerging Markets Index'' and ``MSCI'' are service
marks of Morgan Stanley Capital International (``MSCI'') and have
been licensed for use for certain purposes by ProFunds Trust. All
other trademarks and service marks are the property of their
respective owners. The UltraShort MSCI Emerging Markets ProShares
(``EEV'') are not sponsored, endorsed, issued, sold or promoted by
MSCI. MSCI has not licensed or authorized ISE to (i) engage in the
creation, listing, provision of a market for trading, marketing, and
promotion of options on EEV or (ii) to use and refer to any of their
trademarks or service marks in connection with the listing,
provision of a market for trading, marketing, and promotion of
options on EEV or with making disclosures concerning options on EEV
under any applicable federal or state laws, rules or regulations.
MSCI does not sponsor, endorse, or promote such activity by ISE and
is not affiliated in any manner with ISE.
\8\ iShares[reg] is a registered trademark of Barclays Global
Investors, N.A. (``BGI''), a wholly owned subsidiary of Barclays
Bank PLC. ``Russell 1000[reg] Growth Index'' is a trademark of Frank
Russell Company (``Russell'') and has been licensed for use for
certain purposes by BGI. All other trademarks and service marks are
the property of their respective owners. iShares Russell 1000 Growth
Index Fund (``IWF'') is not sponsored, sold or endorsed by Russell.
Russell and BGI have not licensed or authorized ISE to (i) engage in
the creation, listing, provision of a market for trading, marketing,
and promotion of options on IWF or (ii) to use and refer to any of
their trademarks or service marks in connection with the listing,
provision of a market for trading, marketing, and promotion of
options on IWF or with making disclosures concerning options on IWF
under any applicable federal or state laws, rules or regulations.
Russell and BGI do not sponsor, endorse, or promote such activity by
ISE and are not affiliated in any manner with ISE.
\9\ ``Standard & Poor's[reg],'' ``S&P[reg],'' ``Standard &
Poor's Depositary Receipts[reg],'' ``SPDR[reg]'' and ``the S&P[reg]
Retail Select Industry Index,'' are trademarks of The McGraw-Hill
Companies, Inc. (``McGraw-Hill''), and have been licensed for use by
SSgA Fund Management, Inc., and streetTRACKS[reg] Series Trust in
connection with the listing and trading of SPDR[reg] S&P Retail
Select ETF (``XRT''). XRT is not sponsored, sold or endorsed by
Standard & Poor's, (``S&P''), a division of McGraw-Hill, and S&P
makes no representation regarding the advisability of investing in
XRT. McGraw-Hill and S&P have not licensed or authorized ISE to (i)
engage in the creation, listing, provision of a market for trading,
marketing, and promotion of options on XRT or (ii) to use and refer
to any of their trademarks or service marks in connection with the
listing, provision of a market for trading, marketing, and promotion
of options on XRT or with making disclosures concerning options on
XRT under any applicable federal or state laws, rules or
regulations. McGraw-Hill and S&P do not sponsor, endorse, or promote
such activity by ISE and are not affiliated in any manner with ISE.
\10\ The Market Vectors--Agribusiness ETF (``MOO'') is
distributed by Van Eck Securities Corporation and seeks to track the
DAXglobal[reg] Agribusiness Index, which is published by Deutsche
B[ouml]rse AG (``Deutsche B[ouml]rse''). The DAXglobal[reg]
Agribusiness Index is a trademark of Deutsche B[ouml]rse and is
licensed for use by Van Eck Associates Corporation (``Van Eck'') in
connection with MOO. Deutsche B[ouml]rse does not sponsor, endorse,
or promote MOO and makes no representation regarding the
advisability of investing in MOO. Van Eck has not licensed or
authorized ISE to (i) engage in the creation, listing, provision of
a market for trading, marketing, and promotion of options on MOO or
(ii) to use and refer to any of their trademarks or service marks in
connection with the listing, provision of a market for trading,
marketing, and promotion of options on MOO or with making
disclosures concerning options on MOO under any applicable federal
or state laws, rules or regulations. Van Eck does not sponsor,
endorse, or promote such activity by ISE and is not affiliated in
any manner with ISE.
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All of the applicable fees covered by this filing are identical to
fees charged by the Exchange for all other Premium Products.
Specifically, the Exchange is proposing to adopt an execution fee and a
comparison fee for all transactions in options on FXP, EEV, IWF, XRT
and MOO.\11\ The amount of the execution fee and comparison fee for
products covered by this filing shall be $0.15 and $0.03 per contract,
respectively, for all Public Customer Orders \12\ and Firm Proprietary
orders. The amount of the execution fee and comparison fee for all ISE
Market Maker transactions shall be equal to the execution fee and
comparison fee currently charged by the Exchange for ISE Market Maker
transactions in equity options.\13\ Finally, the amount of the
execution fee and comparison fee for all non-ISE Market Maker
transactions shall be $0.37 and $0.03 per contract, respectively.\14\
Further, since options on FXP, EEV, IWF, XRT and MOO are multiply-
listed, the Exchange's Payment for Order Flow fee shall apply to all of
these products. The Exchange believes the proposed rule change will
further the Exchange's goal of introducing new products to the
marketplace that are competitively priced.
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\11\ These fees will be charged only to Exchange members. Under
a pilot program that is set to expire on July 31, 2008, these fees
will also be charged to Linkage Principal Orders (``Linkage P
Orders'') and Linkage Principal Acting as Agent Orders (``Linkage P/
A Orders''). The amount of the execution fee charged by the Exchange
for Linkage P Orders and Linkage P/A Orders is $0.24 per contract
side and $0.15 per contract side, respectively. See Securities
Exchange Act Release No. 56128 (July 24, 2007), 72 FR 42161 (August
1, 2007) (SR-ISE-2007-55).
\12\ Public Customer Order is defined in Exchange Rule
100(a)(39) as an order for the account of a Public Customer. Public
Customer is defined in Exchange Rule 100(a)(38) as a person that is
not a broker or dealer in securities.
\13\ The execution fee is currently between $.21 and $.12 per
contract side, depending on the Exchange Average Daily Volume, and
the comparison fee is currently $.03 per contract side.
\14\ The amount of the execution and comparison fee for non-ISE
Market Maker transactions executed in the Exchange's Facilitation
and Solicitation Mechanisms is $0.16 and $0.03 per contract,
respectively.
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the objectives of Section 6 of the Act,\15\ in general, and
furthers the objectives of Section 6(b)(4),\16\ in particular, in that
it is designed to provide for the equitable allocation of reasonable
dues, fees, and other charges among its members and other persons using
its facilities.
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\15\ 15 U.S.C. 78f.
\16\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
[[Page 12240]]
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing rule change establishes or changes a due,
fee, or other charge imposed by the Exchange, it has become effective
pursuant to Section 19(b)(3)(A) of the Act \17\ and Rule 19b-4(f)(2)
\18\ thereunder. 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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\17\ 15 U.S.C. 78s(b)(3)(A).
\18\ 17 CFR 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, 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 No. SR-ISE-2008-13 on the subject line.
Paper Comments
Send paper comments in triplicate to Nancy M. Morris,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-ISE-2008-13. 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 ISE. 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-ISE-2008-13 and should be
submitted on or before March 27, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\19\
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\19\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8-4311 Filed 3-5-08; 8:45 am]
BILLING CODE 8011-01-P