[Federal Register Volume 62, Number 101 (Tuesday, May 27, 1997)]
[Notices]
[Pages 28749-28750]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-13696]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-38654; File No. SR-CBOE-97-20]
Self-Regulatory Organizations; The Chicago Board Options
Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change Relating to Fees Charged for Participation in the
NYSE Options Program
May 19, 1997.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ notice is hereby given that on April 25, 1997, the
Chicago Board Options Exchange (``CBOE'' 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 prepared by CBOE. 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) (1988).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The purpose of the proposed rule change is to impose booth and
telecommunications fees for participation in the New York Stock
Exchange (``NYSE'') Options Program. CBOE proposes to impose these fees
from the start of trading of those options on CBOE's alternate trading
floor (``Green Badge Floor'') on April 28, 1997.\2\
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\2\ On April 23, 1997, the Commission approved proposed rule
changes regarding the transfer of the NYSE Options business to CBOE.
See Securities Exchange Act Release No. 38541 (April 23, 1997), 62
FR 23516 (order approving File No. SR-CBOE-97-14); and 38542 (April
23, 1997), 62 FR 23521 (order approving File No. SR-NYSE-97-05).
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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, CBOE included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments that it received on the proposed rule change.
The text of these statements may be examined at the places specified in
Item IV below. CBOE 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
The purpose of the proposed rule change is to impose Exchange fees
for booth and telecommunications costs which are different than the
fees set forth in CBOE's standards fee schedule. The fees for the NYSE
Options Program will be imposed from the start of trading of these
options on the CBOE on April 28, 1997.
The proposed fees are: (1) For non-Options Clearing Corporation
member firms, the Green Badge space flat fee of $500 per month per
booth with no variable fee; (2) for Options Clearing Corporation member
firms, a flat fee of or $150 per month per booth with no variable
fee;\3\ for initial installation only, a fee of $250 per Exchange
phone;
[[Page 28750]]
and (4) for initial installation only, a fee of $50 per single line
set.
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\3\ Although CBOE's proposed rule change indicates that the $150
flat fee applies to CBOE member firms, CBOE has clarified that the
fee applies to Options Clearing Corporation members participating in
the NYSE Options Program. Telephone conversation between Timothy
Thompson, Senior Attorney, CBOE and Margaret R. Blake, Division of
Market Regulation, Commission (May 13, 1997).
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CBOE proposes the imposition of these fees pursuant to CBOE Rule
2.22. The Exchange will distribute a circular to its members to notify
them of the imposition of these Exchange fees.\4\
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\4\ Prior to the transfer of NYSE Options business, CBOE
notified NYSE Options firms of the telecommunication and booth fees.
Memorandum from Ed Joyce, CBOE, to relocating NYSE Options firms
(March 31, 1997).
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The Exchange is imposing these fees as a result of the transfer of
the NYSE Options Program. The fees are less than comparable fees
charged on the CBOE main floor because of the reduced value of the
Green Badge floor space relative to the value of booth space on the
CBOE main floor. The telecommunications fees are reduced for initial
installation only with fees reverting back to the standard schedule
after the relocation is completed. The purpose for the reduced
telecommunications fees is due to the Green Badge Floor having been
newly constructed, causing the phone installation costs to be
substantially less than adding a phone to a pre-existing location.
CBOE believes the proposed rule change is consistent with its
requirements under the Act, specifically with Section 6(b)(4),\5\ in
that it provides for the equitable allocation of reasonable dues, fees,
and other charges among its members and issuers and other persons using
its facilities.
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\5\ 15 U.S.C. 78f(b)(4).
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(B) Self-Regulatory Organization's Statement on Burden on Competition
CBOE does not believe that the proposed rule change will impose any
burden on competition.
(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 rule change established or changes a due, fee, or
other charge imposed by the Exchange and therefore, has become
effective pursuant to Section 19(b)(3)(A)(ii) \6\ of the Act and Rule
19b-4(e)(2) \7\ thereunder. At any time within sixty 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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\6\ 15 U.S.C. 78s(b)(3)(A)(ii).
\7\ 17 CFR 240.19b-4(e)(2).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. Persons making written submissions
should file six copies thereof with the Secretary, Securities and
exchange Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.
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, 450 Fifth Street, N.W., Washington,
D.C. 20549. Copies of such filing will also be available for inspection
and copying at the principal office of the Exchange. All submissions
should refer to the File No. SR-CBOE-97-20 and should be submitted by
June 17, 1997.
For the Commission by the Division of Market Regulation,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-13696 Filed 5-23-97; 8:45 am]
BILLING CODE 8010-01-M
