[Federal Register Volume 69, Number 100 (Monday, May 24, 2004)]
[Notices]
[Pages 29591-29592]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-11646]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-49723; File No. SR-CBOE-2004-26]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the Chicago Board Options 
Exchange, Inc. to Remove From the Exchange Rules References to Certain 
Indexes and Trading Permits

May 18, 2004.
    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 May 10, 2004, 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 CBOE. Pursuant to 
Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(6) 
thereunder,\4\ CBOE has designated this proposal as non-controversial, 
which renders the proposed rule change 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)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to remove from its rules references to 
``Options Trading Permits'' and ``IPC Permits'' as these permits are no 
longer valid on the Exchange. The Exchange also proposes to remove from 
its rules references to the ``IPC Index.'' In addition, the Exchange is 
making a housekeeping change to Appendix A of Chapters XLVII to XLIX. 
The text of the proposed rule change is available at CBOE and at the 
Commission.

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 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

1. Purpose
    The Exchange is removing from its membership rules references to 
certain permits that granted the holders of the permits certain trading 
rights on the Exchange. Specifically, the Exchange is proposing to 
remove from its rules references to ``IPC Permits'' and related 
references and ``Options Trading Permits'' as these permits either are 
no longer valid on the Exchange or have since expired pursuant to their 
terms.
    The Exchange represents that it previously entered into a license 
agreement with Bolsa Mexicana de Valores (``Bolsa'') pursuant to which 
Bolsa licensed the Exchange to trade options on the Indice de Precios y 
Cotizaciones (``IPC''). CBOE states that in consideration for the grant 
of this license, it agreed to issue IPC permits to Bolsa members to 
trade options on the IPC and amended its membership rules to provide 
for the issuance of IPC permits that granted to the holder of an IPC 
permit limited trading rights. CBOE represents that since it never 
issued any IPC permits and because IPC Index options are no longer 
listed on the Exchange, the Exchange is removing all references in its 
rules relating to the IPC Index and IPC permits.
    In addition, the Exchange states that in 1997, it entered into an 
agreement (the ``NYSE Agreement'') with the New York Stock Exchange, 
Inc. (``NYSE'') whereby the NYSE transferred its options business to 
the Exchange. The Exchange states that in connection with the transfer 
of NYSE's options business, it made available to the individuals who 
had traded options on the NYSE a certain number of Options Trading 
Permits (``OTPs''), whose rights and obligations are set forth in Rule 
3.27, ``Options Trading Permits''. On April 27, 2004, in accordance 
with the terms of the NYSE Agreement, the OTPs

[[Page 29592]]

expired. Holders of OTPs who wished to continue trading on the Exchange 
needed to either purchase or lease a CBOE membership or obtain CBOE 
membership trading rights through the exercise of a full Chicago Board 
of Trade membership. The Exchange represents that it is removing rule 
text relating to OTPs because all OTPs have expired.
    The Exchange is also making a housekeeping change to Appendix A of 
Chapters XLVII to XLIX of the Exchange rules (``Appendix'') to update 
the Appendix as a result of the removal of Rules 3.26 and 3.27 from the 
Exchange rules and certain other rule changes to the Exchange rules 
that are not reflected in the Appendix.
2. Statutory Basis
    The proposed rule change removes from Exchange rules certain 
provisions that are no longer applicable and makes a nonsubstantive 
housekeeping change to certain other provisions and therefore, the 
Exchange believes, is consistent with Section 6(b) of the Act \5\ in 
general and furthers the objectives of Section 6(b)(5) of the Act \6\ 
in particular in that it should promote just and equitable principles 
of trade, serve to remove impediments to and perfect the mechanism of a 
free and open market and a national market system, and protect 
investors and the public interest.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
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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 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

    The foregoing proposed rule change has become effective pursuant to 
Section 19(b)(3)(A) of the Act \7\ and Rule 19b-4(f)(6)\8\ thereunder 
because the proposed rule change (1) does not significantly affect the 
protection of investors or the public interest, (2) does not impose any 
significant burden on competition, and (3) does not become operative 
for 30 days from the date of filing, or such shorter time that the 
Commission may designate if consistent with the protection of investors 
and the public interest, provided that the self-regulatory organization 
has given the Commission written notice of its intent to file the 
proposed rule change at least five business days prior to the filing 
date of the proposed rule change.\9\ At any time within 60 days of the 
filing of the 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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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6).
    \9\ As required under Rule 19b-4(f)(6)(iii), CBOE provided the 
Commission with written notice of its intent to file the proposed 
rule change at least five business days prior to the filing date.
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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 [email protected]. Please include 
File Number SR-CBOE-2004-26 on the subject line.

Paper Comments

     Send paper comments in triplicate to Jonathan G. Katz, 
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW., 
Washington, DC 20549-0609.
    All submissions should refer to File Number SR-CBOE-2004-26. 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. Copies of such 
filing also will be available for inspection and copying at the 
principal office of the Exchange. 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-CBOE-2004-26 and should be submitted on or before June 
14, 2004.

    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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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 04-11646 Filed 5-21-04; 8:45 am]
BILLING CODE 8010-01-P