[Federal Register Volume 67, Number 95 (Thursday, May 16, 2002)]
[Notices]
[Pages 34964-34965]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-12205]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-45904; File No. SR-CBOE-2002-17]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Chicago Board Options 
Exchange, Incorporated Relating to Fees for Telecommunications, Screen-
Based Trading, and Market Data Products

May 9, 2002.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'')\1\ and Rule 19b-4 thereunder,\2\ notice hereby is given that 
on April 19, 2002, the Chicago Board Options Exchange, Incorporated 
(``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 
Exchange. 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.
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I. Self-Regulatory Organization's Statement of the Terms of 
Substance of the Proposed Rule Change

    CBOE is proposing to make a change to its Fee Schedule to: (1) 
Reduce its telecommunication fees; (2) modify its connectivity fee 
schedule for the CBOEdirect screen-based trading system; and (3) 
reflect charges for additional market data (regarding the New York 
Stock Exchange's OpenBook) now available through trading floor 
terminals rented by CBOE members. The text of the proposed rule change 
is available at the Exchange's Office of the Secretary 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

    In its filing with the Commission, CBOE included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received regarding 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

1. Purpose
Reduction of Telecommunication Fees
    CBOE increased its telecommunications fees this year to help fund 
the installation of a new trading floor phone system.\3\ Because the 
installation of the phone system will take place later than previously 
anticipated, CBOE has decided that certain of the fees should be 
reduced. CBOE proposes to implement these reductions through the 
changes to Section 7G of the Exchange Fee Schedule.
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    \3\ See Securities Exchange Act Release No. 45269 (January 11, 
2002), 67 FR 2710 (January 18, 2002) (SR-CBOE-2001-72).
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Modification of Connectivity Fees for CBOEdirect

    In a previous rule filing, CBOE provided a detailed technical 
explanation of the connectivity fees imposed by the Exchange in 
connection with the CBOEdirect screen-based trading platform.\4\ CBOE 
now proposes certain modifications to the connectivity fees that would 
reduce the costs of certain connectivity alternatives while also more 
fairly distributing the overall costs associated with CBOEdirect 
connectivity. CBOE proposes to implement these modifications through 
the changes to Section 15 of the Exchange Fee Schedule.
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    \4\ See Securities Exchange Act Release No. 45009 (October 31, 
2001), 66 FR 56365 (November 7, 2001) (SR-CBOE-2001-55).
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Fees Relating to New NYSE Open Book Service
    The New York Stock Exchange (``NYSE'') has launched a new market 
data product called OpenBook, which will display the NYSE book through 
all prices for an individual stock. OpenBook is accessible through 
quote vendors that supply the information as

[[Page 34965]]

an add-on service. CBOE members who rent trading floor terminals will 
be able to access the OpenBook data for an additional fee, set forth in 
the proposed amendments to Section 7(G)(10) of the Exchange Fee 
Schedule. Although CBOE will collect the fee for OpenBook access, all 
of the fee will be passed on to the quote vendor.\5\
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    \5\ Telephone conversation between Christopher Hill, Legal 
Division, CBOE, and Michael Gaw, Division of Market Regulation, 
Commission, on May 9, 2002.
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2. Statutory Basis
    CBOE believes that 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 charges among CBOE members.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement of Burden on Competition

    CBOE does not believe that the proposed rule change would impose 
any burden on competition not necessary or appropriate in furtherance 
of 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

    CBOE has asserted that, 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\8\ and subparagraph (f)(2) of Rule 19b-4 thereunder.\9\ 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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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 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, including whether the proposed rule 
change is consistent with the Act. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street NW., Washington DC 20549-0609. 
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 at the 
Commission's Public Reference Room. Copies of such filing will also be 
available for inspection and copying at the principal office of the 
Exchange. All submissions should refer to File No. SR-CBOE-2001-17 and 
should be submitted by June 6, 2002.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-12205 Filed 5-15-02; 8:45 am]
BILLING CODE 8010-01-P