80 FR 70 pgs. 19705-19707 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees Schedule
Type: NOTICEVolume: 80Number: 70Pages: 19705 - 19707
Pages: 19705, 19706, 19707Docket number: [Release No. 34-74668; File No. SR-CBOE-2015-032]
FR document: [FR Doc. 2015-08379 Filed 4-10-15; 8:45 am]
Agency: Securities and Exchange Commission
Official PDF Version: PDF Version
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-74668; File No. SR-CBOE-2015-032]
Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees Schedule
April 7, 2015.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the "Act"),1and Rule 19b-4 thereunder,2notice is hereby given that on March 27, 2015, Chicago Board Options Exchange, Incorporated (the "Exchange" or "CBOE") filed with the Securities and Exchange Commission (the "Commission") the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.
Footnotes:
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b-4.
I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change
The Exchange proposes to amend its Fees Schedule. The text of the proposed rule change is available on the Exchange's Web site ( http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx ), at the Exchange's Office of the Secretary, 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
[top] 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 Exchange proposes to adopt a Trading Permit Holder Regulatory Fee of $90 per month, per Regular Trading Hours3("RTH") Trading Permit, applicable to all Trading Permit Holders ("TPHs"). Specifically, the Exchange is proposing to adopt this fee as the Exchange's regulatory costs have increased and in order to help more closely cover the costs of regulating all TPHs and performing regulatory responsibilities. The Exchange believes the proposed fee amount is modest, as well as reasonable for TPHs of all sizes. The Trading Permit Holder Regulatory Fee will be non-refundable and assessed through the integrated billing system during the first week of the following month. Additionally, the Exchange notes that if a Trading Permit is issued during a calendar month after the first trading day of the month, the Trading Permit Holder Regulatory Fee for the Trading Permit for that calendar month will be prorated based on the remaining trading days in the calendar month.
Footnotes:
3 Rule 1.1(qqq) defines "Regular Trading Hours" as the hours during which transactions in options may be made on the Exchange as set forth in Rule 6.1 (which hours are from 8:30 a.m. to either. 3:00 p.m. or 3:15 p.m. Chicago time).
Finally, as noted above, the proposed fee is applicable during RTH only. As such, the Exchange proposes to remove "(Also applies to ETH)(37)" from the Regulatory Fees header and relocate that language next the "Options Regulatory Fee ("ORF")" and "DPM's and Firm Designated Examining Authority Fee" so that it is clear which Regulatory fees are applicable during ETH. The Exchange notes that no substantive change is being made by this change. Rather, the Exchange believes this proposed rule change will maintain clarity in the Fees Schedule and avoid potential confusion.
The proposed rule change is to take effect on April 1, 2015.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the "Act") and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.4Specifically, the Exchange believes the proposed rule change is consistent with Section 6(b)(4) of the Act,5which provides that Exchange rules may provide for the equitable allocation of reasonable dues, fees, and other charges among its Trading Permit Holders and other persons using its facilities. Additionally, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5)6requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers.
Footnotes:
4 15 U.S.C. 78f(b).
5 15 U.S.C. 78f(b)(4).
6 15 U.S.C. 78f(b)(5).
The Exchange believes the proposed fee change is reasonable because it is designed to recoup costs associated with performing its regulatory obligations with respect to TPHs. The proposed rule change will help the Exchange offset increased regulatory expenses, but not result in total regulatory revenue exceeding total regulatory costs. The Exchange believes it is equitable and not unfairly discriminatory because it will apply to all TPHs. Additionally, the Exchange believes it is reasonable, equitable and not unfairly discriminatory to assess the fee per Trading Permit because there is generally a correlation between an increased number of Trading Permits and business on the Exchange, which in turn requires more resources to regulate that business. As such, the Exchange believes assessing this fee on a per Trading Permit basis is the most equitable method of assessing this fee.
The Exchange also believes the proposed rule change is consistent with Section 6(b)(1) of the Act,7which provides that the Exchange be organized and have the capacity to be able to carry out the purposes of the Act and to enforce compliance by the Exchange's TPHs and persons associated with its TPHs with the Act, the rules and regulations thereunder, and the rules of the Exchange. The proposed rule change is designed to fund the Exchange's regulatory program and to help more closely cover the costs of regulating TPHs for which the Exchange has a regulatory responsibility. Thus, the proposed changes will help the Exchange to enforce compliance of its TPHs with the Act and Exchange rules.
Footnotes:
7 15 U.S.C. 78f(b)(1).
Finally, the Exchange believes the proposed change to relocate the language "(Also applies to ETH)(37)" makes clear to market participants which Regulatory fees apply during ETH and reduces potential confusion. The alleviation of potential confusion will remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, protect investors and the public interest.
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. The Exchange believes any burden on competition imposed by the proposed rule change is outweighed by the need to help the Exchange to adequately fund its regulatory activities to ensure compliance with the Exchange Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
The Exchange neither solicited nor received comments on the proposed rule change.
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) of the Act8and paragraph (f) of Rule 19b-49thereunder. 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 will institute proceedings to determine whether the proposed rule change should be approved or disapproved.
Footnotes:
8 15 U.S.C. 78s(b)(3)(A).
9 17 CFR 240.19b-4(f).
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
• 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-CBOE-2015-032 on the subject line.
Paper Comments
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
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For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.10
Footnotes:
10 17 CFR 200.30-3(a)(12).
Brent J. Fields,
Secretary.
[FR Doc. 2015-08379 Filed 4-10-15; 8:45 am]
BILLING CODE 8011-01-P