[Federal Register Volume 77, Number 163 (Wednesday, August 22, 2012)]
[Notices]
[Pages 50745-50746]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-20571]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67668; File No. SR-CBOE-2012-078]


 Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend the CBOE Stock Exchange Fees Schedule

August 15, 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 August 3, 2012, the Chicago Board Options Exchange, 
Incorporated (``Exchange'' or ``CBOE'') 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 the Exchange. The Commission is publishing this notice to solicit 
comment 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.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the Fees Schedule of its CBOE Stock 
Exchange (``CBSX''). The text of the proposed rule change is available 
on the Exchange's Web site (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, 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 Exchange 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 Exchange 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    CBSX recently moved its trading systems over to the Equinix NY4 
facility (``NY4''). In addition to 1 Gigabit Ethernet network access, 
NY4 has capacity to accommodate 10 Gigabit Ethernet network access. The 
Exchange made such a connection available to CBSX market participants, 
and wants to encourage market participants to connect to CBSX via a 10 
Gigabit Network Access Port in order to receive higher-speed executions 
(which is important in today's marketplace). Due to the newness of this 
NY4 system to CBSX, the Exchange wishes to ensure that market 
participants feel comfortable connecting to CBSX via the 10 Gigabit 
Network Access Ports and assuage any kind of concerns CBSX market 
participants may have regarding any kind of possible disruption in 
access to CBSX via the 10 Gigabit Network Access Ports. Therefore, CBSX 
now proposes to add a sentence to its Fees Schedule stating that 
participants requesting a 10 Gigabit Network Access Port to access CBSX 
are eligible to receive (upon request) one redundant 10 Gigabit Network 
Access Port at no extra charge.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\3\ Specifically, the Exchange believes the proposed rule change is 
consistent with Section 6(b)(4) of the Act,\4\ which provides that 
Exchange rules may provide for the equitable allocation of reasonable 
dues, fees, and other charges among its Trading Permit Holders and 
other persons using its facilities. Providing CBSX market participants 
who access the CBSX System via a 10 Gigabit Network Access Port on NY4 
the opportunity to request a redundant 10

[[Page 50746]]

Gigabit Network Access Port to act as a backup is reasonable because 
such market participants will receive a backup redundant 10 Gigabit 
Network Access Port free of charge.
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    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(4).
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    Providing CBSX market participants who access the CBSX System via a 
10 Gigabit Network Access Port on NY4 the opportunity to request a 
redundant 10 Gigabit Network Access Port to act as a backup while not 
providing the same opportunity to CBSX market participants who access 
the CBSX System via a 1 Gigabit Network Access Port is equitable and 
not unfairly discriminatory because providing such opportunity would 
cause an increase in the price of accessing the CBSX System via a 1 
Gigabit Network Access Port. Moreover, as faster access continues to 
grow in importance to trading and CBSX continues to develop 
technologies that provide faster access to CBSX, CBSX wants to 
encourage the election to connect to CBSX via a higher-speed Network 
Access Port in order to provide better trading opportunities on CBSX. 
Further, while a 10 Gigabit Network Access Port connection is more 
costly than a 1 Gigabit Network Access Port connection, considering the 
fact that a 10 Gigabit Network Access Port provides a connection that 
is ten times faster than a 1 Gigabit Network Access Port, a 10 Gigabit 
Network Access Port actually provides a less expensive connection on a 
per-Gigabit basis.\5\ Finally, any CBSX market participant may elect to 
connect to CBSX via a 10 Gigabit Network Access Port (and therefore be 
eligible to request a redundant 10 Gigabit Network Access Port).
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    \5\ See CBSX Fees Schedule, Section 8.
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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 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 neither solicited nor received comments on the 
proposed rule change.

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) \6\ of the Act and paragraph (f) of Rule 19b-4 \7\ 
thereunder. 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.
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    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f).
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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 email to [email protected]. Please include 
File Number SR-CBOE-2012-078 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-2012-078. 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 
10:00 a.m. and 3:00 p.m. 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-2012-078 and should be 
submitted on or before September 12, 2012.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2012-20571 Filed 8-21-12; 8:45 am]
BILLING CODE 8011-01-P