[Federal Register Volume 76, Number 173 (Wednesday, September 7, 2011)]
[Notices]
[Pages 55447-55449]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-22774]
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SECURITIES AND EXCHANGE COMMISSION
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change to Extend the Compliance Deadline for Qualification
Pursuant to Rule 3.6A
August 30, 2011.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``the ``Act''),\1\ notice is hereby given that on August 23, 2011,
Chicago Board Options Exchange, Incorporated (``CBOE'' or the
``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. The Exchange has
designated this proposal as one constituting a stated policy, practice,
or interpretation with respect to the meaning, administration, or
enforcement of an existing rule under Section 19((b)(3)(A)(i) of the
Act,\2\ and Rule 19b-4(f((1) \3\ thereunder, which renders the proposal
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\ 15 U.S.C. 78s(b)(3)(A)(i).
\3\ 17 CFR 19b-4(f)(1).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Pursuant to the provisions of Section 19(b)(1) of the Securities
Exchange Act of 1934 (the ``Act''),\4\ the Exchange proposes to extend
the September 19, 2011 deadline to October 29, 2011 to comply with its
rules regarding registration and qualification of individual Trading
Permit Holders and individual associated persons.\5\ CBOE is not
proposing any textual changes to the Rules of CBOE. The text of the
proposed rule change is available on the Exchange's Web site (http://www.cboe.org/legal), at the Exchange's Office of the Secretary and at
the Commission's Public Reference Room.
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\4\ 15 U.S.C. 78s(b)(1).
\5\ The Commission notes that the extension until October 29,
2011 is an extension of the time to pass the appropriate
qualification exam. All individual Trading Permit Holders and
individual associated persons not already registered in WebCRD were
to be registered as of January 11, 2011. See Securities Exchange Act
Release No. 63314 (November 12, 2010), 75 FR 70957 (November 19,
2010), at 70958.
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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, Proposed Rule Change
1. Purpose
Pursuant to Rule 15b7-1,\6\ promulgated under the Exchange Act,\7\
``No registered broker or dealer shall effect any transaction in * * *
any security unless any natural person associated with such broker or
dealer who effects or is involved in effecting such transaction is
registered or approved in accordance with the standards of training,
experience, competence, and other qualification
standards[hellip]established by the rules of any national securities
exchange[hellip]'' CBOE Rule 3.6A sets forth the requirements for
registration and qualification of individual Trading Permit Holders and
individual associated persons. In response to a request by the Division
of Trading and Markets at the Securities and Exchange Commission (the
``Commission'' or ``SEC''), CBOE recently amended its rules to expand
its registration and qualification requirements set forth in CBOE Rule
3.6A to include individual Trading Permit Holders and individual
associated persons that are engaged or to be engaged in the securities
business of a Trading Permit Holder or TPH organization.\8\ CBOE Rule
3.6A provides that these individuals must be registered with the
Exchange in the category of registration appropriate to the function to
be performed as prescribed by the Exchange. Further, Rule 3.6A
requires, among other things, that an individual Trading Permit Holder
or individual associated person submit an application for registration
and pass the appropriate qualification examination before the
registration can become effective. The revised requirements apply to
both CBOE and CBOE Stock Exchange (``CBSX'') Trading Permit Holders and
their associated persons.
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\6\ 17 CFR 240.15b7-1.
\7\ 15 U.S.C. 78a et seq.
\8\ See Securities Exchange Act Release No. 63314 (November 12,
2010), 75 FR 70957 (November 19, 2010) (SR-CBOE-2010-084).
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In conjunction with the registration requirements established by
SR-CBOE-2010-084, three new qualification examinations became available
on June 20, 2011 in the Central Registration Depository system
(``WebCRD''), which is operated by the Financial Industry Regulatory
Authority, Incorporated (``FINRA''). These registration categories
include the following (the required qualification examinations and
prerequisites, as applicable, associated with each registration
category are in parentheses): PT--Proprietary Trader (Series 56), CT--
Proprietary Trader Compliance Officer (Series 14, Series 56
prerequisite) and TP--Proprietary Trader Principal (Series 24, Series
56 prerequisite). In the Approval Order for SR-CBOE-2010-084, the SEC
established a deadline of August 12, 2011 for CBOE and CBSX individual
Trading Permit Holders and individual
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associated persons of CBOE and CBSX Trading Permit Holders to register
for and pass the applicable qualification examination(s), approximately
seven weeks from the date the qualification exams became available.
CBOE recently submitted a rule filing extending the deadline until
September 19, 2011.\9\ The International Securities Exchange, LLC
(``ISE'') recently submitted a rule filing setting forth the content
outline for the Series 56.\10\ In conjunction with this filing, ISE
issued a Regulatory Information Circular \11\ establishing a deadline
of October 29, 2011 for complying with its new registration and
qualification requirements.
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\9\ See Securities Exchange Act Release No. 64946 (July 21,
2011), 76 FR 44972 (July 27, 2011) (SR-CBOE-2011-064).
\10\ See Securities Exchange Act Release No. 65086 (August 10,
2011), 76 FR 50796 (August 16, 2011) [sic] (SR-ISE-2011-036).
\11\ See ISE Regulatory Information Circular 2011-15 (issued
August 15, 2011).
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CBOE respectfully requests to extend the September 19, 2011
deadline to October 29, 2011 (or such other later compliance date as
the Commission deems appropriate for the participating self-regulatory
organizations) to be consistent with the deadline provided to ISE
members to comply with the registration and qualification
requirements.\12\ CBOE believes its proposal to extend this deadline is
reasonable and necessary in an effort to implement consistent standards
for registration and qualification across self-regulatory
organizations.
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\12\ The International Securities Exchange (``ISE'') received
approval for a rule filing establishing substantially similar
registration and qualification requirements on February 4, 2011. The
Approval Order for SR-ISE-2010-115 provides that ``Associated
persons of ISE members will have 90 days from the date the
examination becomes available to take and pass the examination.''
See Securities Exchange Act Release No. 63843 (February 4, 2011), 76
FR 7884 (February 11, 2011) (SR-ISE-2010-115).
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CBOE continues to evaluate the reasonability of the proposed
deadline in light of various factors including, but not limited to, the
following: (i) Potential disruption to the marketplace if a Market-
Maker or Designated Primary Market-Maker does not satisfy the
qualification requirements; (ii) system enforced delays in registering
for an examination in WebCRD upon an individual's failure of a
qualification examination; (iii) examination scheduling limitations due
to the volume of individuals required to take the examination(s); and
(iv) the ability for those individuals subject to heightened
qualification examinations to prepare for, schedule and pass more than
one examination in an extremely limited window of time. CBOE will
continue to update Commission staff and evaluate whether additional
rule filings are necessary to address reasonability concerns in
conjunction with requiring compliance within the proposed time frame.
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the
Act,\13\ in general, and furthers the objectives of Section 6(b)(1)
\14\ of the Act in particular, in that it is designed to enforce
compliance by Exchange members and persons associated with its members
with the rules of the Exchange. The Exchange also believes the proposed
rule change furthers the objectives of Section 6(c)(3) \15\ of the Act,
which authorizes CBOE to prescribe standards of training, experience
and competence for persons associated with CBOE members, in that this
filing is proposing to extend the deadline for compliance with the
standards of training, experience and competence established by the
Exchange. CBOE believes that its proposal is reasonable in that it
establishes a deadline for compliance with the registration and
qualification requirements that is consistent with the deadline in
place for ISE members and their associated persons.
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\13\ 15 U.S.C. 78f(b).
\14\ 15 U.S.C. 78f(b)(1).
\15\ 15 U.S.C. 78f(c)(3).
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B. Self-Regulatory Organization's Statement on Burden on Competition
CBOE does not believe that the proposed rule change will impose any
burden on competition that is not necessary or appropriate in
furtherance 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 will take effect upon filing
with the Commission pursuant to Section 19(b)(3)(A)(i) of the Act \16\
and Rule 19b-4(f)(1) thereunder,\17\ because it constitutes a stated
policy, practice, or interpretation with respect to the meaning,
administration, or enforcement of an existing rule.
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\16\ 15 U.S.C. 78s(b)(3)(A)(i).
\17\ 17 CFR 240.19b-4(f)(1).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend 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.
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-2011-081 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-CBOE-2011-081. 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 Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of such filing also will be available for
inspection and copying at the principal office of CBOE. 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 publicly available. All
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submissions should refer to File Number SR-CBOE-2011-081 and should be
submitted on or before September 28, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-22774 Filed 9-6-11; 8:45 am]
BILLING CODE 8011-01-P