[Federal Register Volume 62, Number 238 (Thursday, December 11, 1997)]
[Notices]
[Pages 65299-65300]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-32367]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-39389; File No. SR-CBOE-97-60]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the Chicago Board Options
Exchange, Inc., Relating to Transaction Fees for Options on the
Standard & Poor's 100 Stock Index
December 3, 1997.
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 November 20, 1997, the Chicago Board Options Exchange, Inc.
(``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 the CBOE.
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------
\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 CBOE proposes to modify the Exchange transaction fees
applicable to transactions in options on the Standard & Poor's 100
Stock Index (``OEX'').
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 CBOE 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 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
1. Purpose
The Exchange recently filed with the Commission a proposed rule
change \3\ in which the Exchange informed the Commission that Standard
& Poor's (``S&P'') intended to reduce the value of its S&P 100 Stock
Index (``Index'') to one-half of its present value by doubling the
divisor used in calculating the Index.\4\ In connection with the
``split'' of the OEX, the Exchange has evaluated the appropriateness of
the current fee schedule and has determined to reduce the transaction
fees applicable to transactions in OEX. The current and proposed
transaction fees absent any reduction or rebate \5\ are: (1) For
customer trades for options with a premium less than $1--current: $0.20
per contract side; proposed: $0.15 per contract side; (2) for customer
trades of options with a premium equal to or greater than $1--current:
$0.40 per contract side; proposed: $0.30 per contract side; (3) for
member firm proprietary trades--current: $0.10 per contract side:
proposal: $0.06 per contract side; and (4) for market-maker trades--
current: $.06 per contract side; proposed: $.05 per contract side. The
foregoing fee changes are being implemented by the Exchange pursuant to
CBOE Rule 2.22. The Exchange will distribute a circular to its members
to notify them of these fee changes.
---------------------------------------------------------------------------
\3\ The Commission approved the proposed rule change on November
19, 1997. See Securities Exchange Act Release No. 39338, 62 FR 63209
(November 26,1997) (order approving File No. SR-CBOE-97-48).
\4\ According to the Exchange, the value of the Index was
reduced by one-half effective November 24, 1997. Telephone
conversation between Timothy Thompson, Senior Attorney, CBOE, and
Deborah Flynn, Division of Market Regulation, Commission, on
December 2, 1997.
\5\ The fees may actually be less than these amounts pursuant to
the Exchange's Prospective Fee Reduction Schedule, the Customer
Large Trade Discount Program, and rebate programs that have been
filed with the Commission as part of the Exchange's fee schedule.
---------------------------------------------------------------------------
The Exchange is adopting this fee reduction for transactions in OEX
options in order to promote trading in these options after the split in
OEX. The Exchange believes that the reduction in the fees may encourage
more participation in the trading of these options.
[[Page 65300]]
2. Statutory Basis
The proposed rule change 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 designed to provide for the
equitable allocation of reasonable dues, fees, and other changes among
CBOE members.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78(b)(4).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose a 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 establishes or changes a due, fee, or
other charge imposed by the Exchange and therefore has become effective
pursuant to Section 19(b)(3)(A) of the Act \8\ and subparagraph (e) of
Rule 19b-4 \9\ thereunder. At any time within 60 days of the filing of
such 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 proposes of the Act.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 19b-4(e).
---------------------------------------------------------------------------
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing. Persons making written submission
should file six copies thereof with the Secretary, Securities and
Exchange Commission, 450 Fifth Street NW., Washington, DC 20549. Copies
of the submissions, 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 NW., Washington,
DC. Copies of such filing also will be available for inspection and
copying at the CBOE. All submissions should refer to File No. SR-CBOE-
97-60 and should be submitted by January 2, 1998.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\10\
---------------------------------------------------------------------------
\10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 97-32367 Filed 12-10-97; 8:45 am]
BILLING CODE 8010-01-M