[Federal Register Volume 70, Number 81 (Thursday, April 28, 2005)]
[Notices]
[Page 22162]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-2042]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-51590; File No. SR-CBOE-2005-10]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Inc.; Order Approving Proposed Rule Change To Revise Certain Membership 
Rules Related to the Testing and Orientation Requirements for Nominees 
of Member Organizations Approved Solely as Clearing Members

April 21, 2005.
    On January 25, 2005, the Chicago Board Options Exchange, Inc. 
(``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 revise membership rules 
related to the testing and orientation requirements for certain members 
and to make other non-substantive changes. The proposed rule change was 
published for comment in the Federal Register on March 17, 2005.\3\ The 
Commission received no comments on the proposal. This order approves 
the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 51361 (March 11, 
2005), 70 FR 13058.
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    Pursuant to the proposed rule change, the Exchange will revise 
Exchange Rule 3.8(a)(iii) to provide that nominees of a member 
organization approved solely as a Clearing Member are not required to 
have an authorized trading function. The effect of the rule change is 
to eliminate the requirement that nominees of Clearing Members attend 
the Exchange's Member Orientation Program and pass the Exchange's 
Trading Member Qualification Exam. Clearing Members who wish to engage 
in trading activities on the Exchange will still be required to 
designate a nominee who has an authorized trading function. The 
proposed rule change also makes certain other technical changes to 
internal Exchange procedures for categorizing its members.
    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange and, in 
particular, the requirements of Section 6(b)(5) of the Act,\4\ which 
requires that the rules of the exchange be designed to prevent 
fraudulent and manipulative acts and practices, to promote just and 
equitable principles of trade, and in general, to protect investors and 
the public interest. The Commission finds that removing the 
requirements that nominees of member organizations approved solely as 
Clearing Members attend the Exchange's Member Orientation Program and 
pass the Exchange's Trading Member Qualification Exam is consistent 
with the requirements of Section 6(b)(5) of the Act because the 
exemption only applies to the nominees of member organizations that are 
not engaged with trading with the public.
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    \4\ 15 U.S.C. 78f(b)(5).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\5\ that the proposed rule change (SR-CBOE-2005-10) be, and it 
hereby is, approved.
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    \5\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\6\
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    \6\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-2042 Filed 4-27-05; 8:45 am]
BILLING CODE 8010-01-P