[Federal Register Volume 69, Number 230 (Wednesday, December 1, 2004)]
[Notices]
[Pages 69970-69971]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E4-3407]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-50725; File No. SR-CBOE-2004-25]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Order Granting Approval to Proposed Rule Change and 
Amendment No. 1 Relating to Designated Primary Market-Makers 
Obligations

November 23, 2004.
    On April 23, 2004, the Chicago Board Options Exchange, Incorporated 
(``CBOE'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission''), pursuant to Section 19(b)(1) of the 
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 
thereunder,\2\ a proposed rule change to amend its rules to clarify 
that CBOE Designated Primary Market Makers (``DPMs'') are required to 
make competitive markets on the Exchange and to otherwise promote the 
Exchange in a manner that is likely to enhance the ability of the 
Exchange to compete successfully for order flow in the classes they 
trade. On September 30, 2004, the CBOE filed Amendment No. 1 to the 
proposed rule change.\3\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 replaced and superseded the CBOE's original 
19b-4 filing in its entirety.
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    The proposed rule change, as amended, was published for comment in 
the Federal Register on October 21, 2004.\4\ The Commission received no 
comments on the amended proposal.
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    \4\ See Securities Exchange Act Release No. 50548 (October 15, 
2004), 69 FR 61881.
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    The Commission finds that the proposed rule change, as amended, is 
consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities exchange \5\ 
and, in particular, the requirements of Section 6 of the Act \6\ and 
the rules and regulations thereunder. The Commission finds specifically 
that the proposed rule change, as amended, is consistent with Section 
6(b)(5) of the Act \7\ in that it is designed to promote just and 
equitable principles of trade, remove impediments to and perfect the 
mechanism of a free and open market and a national market system, and, 
in general, to protect investors and the public interest.
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    \5\ In approving this proposed rule change, as amended, the 
Commission notes that it has considered the proposed rule's impact 
on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
    \6\ 15 U.S.C. 78f.
    \7\ 15 U.S.C. 78f(b)(5).
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    The Commission notes that the CBOE is amending the language used to 
describe its DPMs' current obligation under CBOE Rule 8.85(c)(ii) by 
using specific language that was more recently approved by the 
Commission to describe a similar obligation applicable to electronic 
DPMs (``e-DPMs'') under CBOE Rule 8.93(vi). The Commission further 
notes that proposed rule change, as amended, is simply making a 
clarifying change and will not in any way change the substance of the 
DPMs' current obligation. The Commission believes that the proposed 
rule change, as amended, will conform the language used to describe the 
same current DPM and e-DPM obligations, and therefore finds the 
proposal to be consistent with the Act.

[[Page 69971]]

    It is therefore ordered, pursuant to section 19(b)(2) of the 
Act,\8\ that the proposed rule change (File No. SR-CBOE-2004-25), as 
amended, be, and it hereby is, approved.
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    \8\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E4-3407 Filed 11-30-04; 8:45 am]
BILLING CODE 8010-01-P