[Federal Register Volume 77, Number 14 (Monday, January 23, 2012)]
[Notices]
[Pages 3308-3310]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-1238]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-66172; File No. SR-ISE-2012-03]


Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule 
Change Relating to Fees and Rebates for Adding and Removing Liquidity

January 18, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that, on January 5, 2012, the International Securities Exchange, LLC 
(the ``Exchange'' or the ``ISE'') filed with the Securities and 
Exchange Commission (the ``Commission'') the proposed rule change as 
described in Items I and II 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The ISE is proposing to amend its transaction fees and rebates for 
adding and removing liquidity. The text of the proposed rule change is 
available on the Exchange's Web site (http://www.ise.com), at the 
principal office of the Exchange, and 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, the self-regulatory organization 
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. The self-regulatory organization 
has prepared summaries, set forth in sections A, B and C below, of the 
most significant aspects of such statements.

[[Page 3309]]

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange currently assesses per contract transaction fees and 
rebates to market participants that add or remove liquidity from the 
Exchange (``maker/taker fees'') in a number of options classes (the 
``Select Symbols'').\3\ The purpose of this proposed rule change is to 
amend the list of Select Symbols on the Exchange's Schedule of Fees, 
titled ``Rebates and Fees for Adding and Removing Liquidity in Select 
Symbols and Complex Order Maker/Taker fees for symbols that are in the 
Penny Pilot Program'' in order to attract additional order flow to the 
Exchange. The Exchange is proposing to delete AMR Corporation (``AMR'') 
from the list of Select Symbols. With this proposed rule change, AMR 
will no longer be subject to the Exchange's maker/taker fees.
---------------------------------------------------------------------------

    \3\ Options classes subject to maker/taker fees are identified 
by their ticker symbol on the Exchange's Schedule of Fees.
---------------------------------------------------------------------------

    The Exchange also proposes to make a non-substantive, clarifying 
change to page 21 of the Schedule of Fees, titled ``Rebates and Fees 
for Adding and Removing Liquidity for complex orders in NDX and RUT.'' 
The Exchange recently adopted fees and rebates for complex orders in 
NDX and RUT \4\ and now proposes to clarify that the $0.50 per contract 
rebate payable to Priority Customer complex orders when these orders 
trade with non-customer orders in the Complex Order Book is applicable 
only to complex orders in NDX and RUT by deleting the words ``in the 
Select Symbols'' from footnote 2 on page 21 of the Schedule of Fees.
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 66084 (January 3, 
2012) (SR-ISE-2011-84).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal to amend its Schedule of 
Fees is consistent with Section 6(b) of the Act \5\ in general, and 
furthers the objectives of Section 6(b)(4) of the Act \6\ in 
particular, in that it is an equitable allocation of reasonable fees 
and other charges among Exchange members and other persons using its 
facilities.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

    The Exchange believes that it is reasonable to remove AMR from its 
list of Select Symbols to attract additional order flow to the 
Exchange. The Exchange believes that applying non-maker/taker fees to 
AMR, including the opportunity to receive payment for order flow, will 
attract order flow in AMR to the Exchange.
    The Exchange believes that it is equitable and not unfairly 
discriminatory to amend its list of Select Symbols to remove AMR 
because the list of Select Symbols would apply uniformly to all 
categories of participants in the same manner. All market participants 
who trade the Select Symbols would be subject to the maker/taker fees 
and rebates, which would not include AMR. Also, all market participants 
would be uniformly subject to the non-maker/taker fees, which would 
include AMR.
    Finally, the Exchange believes that clarifying that the rebate 
payable to Priority Customer complex orders when these orders trade 
with non-customer orders in the Complex Order Book is applicable only 
to complex orders in NDX and RUT is equitable and reasonable because it 
clarifies the applicability of the rebate.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change does not impose any burden on competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from members or other interested 
parties.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act.\7\ At any time within 60 days of the filing 
of such 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. If the Commission takes such action, the Commission shall 
institute proceedings to determine whether the proposed rule should be 
approved or disapproved.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------

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 email to [email protected]. Please include 
File Number SR-ISE-2012-03 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-ISE-2012-03. This file 
number should be included on the subject line if email 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 the 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-ISE-2012-03 and should be 
submitted on or before February 13, 2012.


[[Page 3310]]


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-1238 Filed 1-20-12; 8:45 am]
BILLING CODE 8011-01-P