[Federal Register Volume 77, Number 158 (Wednesday, August 15, 2012)]
[Notices]
[Pages 49049-49054]
[FR Doc No: 2012-19979]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67628; File No. SR-ISE-2012-71]

Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change To Amend Fees for Certain Regular and Complex Orders Executed on
the Exchange

August 9, 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 1, 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, II, and III below, which items have been prepared by the
self-regulatory organization. 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\ 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 ISE is proposing to amend transaction fees for certain regular
and complex orders executed on the Exchange. 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.

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

1. Purpose
    The Exchange currently assesses a per contract transaction charge
and provides rebates to market participants that add or remove
liquidity from the Exchange (``maker/taker fees and rebates'') in a
number of options classes (the ``Select Symbols'').\3\ For removing
liquidity in the Select Symbols, the Exchange currently charges a taker
fee of: (i) $0.29 per contract for Market Maker \4\ and Market Maker
Plus \5\ orders, (ii) $0.35 per contract for Non-ISE Market Maker \6\
orders, (iii) $0.30 per contract for Firm Proprietary/Broker-Dealer and
Professional Customer \7\ orders, and (iv) $0.20 per contract for
Priority

Customer \8\ orders. The Exchange now proposes to increase the taker
fee for: (i) Market Maker and Market Maker Plus orders in the Select
Symbols from $0.29 per contract to $0.32 per contract, (ii) Non-ISE
Market Maker orders in the Select Symbols from $0.35 per contract to
$0.36 per contract, (iii) Firm Proprietary/Broker-Dealer and
Professional Customer orders in the Select Symbols from $0.30 per
contract to $0.33 per contract, and (iv) Priority Customer orders in
the Select Symbols from $0.20 per contract to $0.25 per contract.
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    \3\ Options classes subject to maker/taker fees and rebates are
identified by their ticker symbol on the Exchange's Schedule of
Fees.
    \4\ The term ``Market Makers'' refers to ``Competitive Market
Makers'' and ``Primary Market Makers'' collectively. See ISE Rule
100(a)(25).
    \5\ A Market Maker Plus is an ISE Market Maker who is on the
National Best Bid or National Best Offer 80% of the time for series
trading between $0.03 and $5.00 (for options whose underlying
stock's previous trading day's last sale price was less than or
equal to $100) and between $0.10 and $5.00 (for options whose
underlying stock's previous trading day's last sale price was
greater than $100) in premium in each of the front two expiration
months and 80% of the time for series trading between $0.03 and
$5.00 (for options whose underlying stock's previous trading day's
last sale price was less than or equal to $100) and between $0.10
and $5.00 (for options whose underlying stock's previous trading
day's last sale price was greater than $100) in premium across all
expiration months in order to receive the rebate. The Exchange
determines whether a Market Maker qualifies as a Market Maker Plus
at the end of each month by looking back at each Market Maker's
quoting statistics during that month. A Market Maker's single best
and single worst overall quoting days each month, on a per symbol
basis, are excluded in calculating whether a Market Maker qualifies
for this rebate, if doing so qualifies a Market Maker for the
rebate. If at the end of the month, a Market Maker meets the
Exchange's stated criteria, the Exchange rebates $0.10 per contract
for transactions executed by that Market Maker during that month.
The Exchange provides Market Makers a report on a daily basis with
quoting statistics so that Market Makers can determine whether or
not they are meeting the Exchange's stated criteria.
    \6\ A Non-ISE Market Maker, or Far Away Market Maker
(``FARMM''), is a market maker as defined in Section 3(a)(38) of the
Securities Exchange Act of 1934, as amended, registered in the same
options class on another options exchange.
    \7\ A Professional Customer is a person who is not a broker/
dealer and is not a Priority Customer.
    \8\ A Priority Customer is defined in ISE Rule 100(a)(37A) as a
person or entity that is not a broker/dealer in securities, and does
not place more than 390 orders in listed options per day on average
during a calendar month for its own beneficial account(s).
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    For complex orders in the Select Symbols (excluding SPY), the
Exchange currently charges a taker fee of: (i) $0.35 per contract for
Market Maker, Firm Proprietary/Broker-Dealer and Professional Customer
orders, and (ii) $0.38 per contract for Non-ISE Market Maker orders.
Priority Customer orders are not charged a taker fee for complex orders
in the Select Symbols (excluding SPY). The Exchange now proposes to
increase the complex order taker fee in the Select Symbols (excluding
SPY) for: (i) Market Maker, Firm Proprietary/Broker-Dealer and
Professional Customer orders, from $0.35 per contract to $0.37 per
contract, and (ii) Non-ISE Market Maker orders, from $0.38 per contract
to $0.39 per contract. The Exchange is not proposing any change to the
complex order taker fee for Priority Customer orders in the Select
Symbols (excluding SPY).
    With this proposed rule change, the Exchange proposes to adopt a
new column for taker fees for SPY as those fees are distinct and also
to provide market participants greater clarity with regards to fees for
SPY.\9\ Specifically, for complex orders in SPY, the Exchange currently
charges a taker fee of: (i) $0.35 per contract for Market Maker, Firm
Proprietary/Broker-Dealer and Professional Customer orders, and (ii)
$0.39 per contract for Non-ISE Market Maker orders. Priority Customer
orders are not charged a taker fee for complex orders in SPY. The
Exchange now proposes to increase the complex order taker fee in SPY
for: (i) Market Maker, Firm Proprietary/Broker-Dealer and Professional
Customer orders, from $0.35 per contract to $0.38 per contract, and
(ii) Non-ISE Market Maker orders, from $0.39 per contract to $0.40 per
contract. The Exchange is not proposing any change to the complex order
taker fee for Priority Customer orders in SPY.
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    \9\ The Exchange notes that its Schedule of Fees has a separate
column for rebates payable for complex orders in SPY. The Exchange
proposes to adopt a similar distinct column for taker fees for
complex orders in SPY.
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    With the proposed adoption of a new column for SPY, the column that
previously reflected taker fees for SPY and Non-Select Penny Pilot
Symbols will now display taker fees for Non-Select Penny Pilot Symbols
only. For complex orders in the Non-Select Penny Pilot Symbols, the
Exchange currently charges a taker fee of: (i) $0.35 per contract for
Market Maker, Firm Proprietary/Broker-Dealer and Professional Customer
orders, and (ii) $0.39 per contract for Non-ISE Market Maker orders.
Priority Customer orders are not charged a taker fee for complex orders
in the Non-Select Penny Pilot Symbols. The Exchange now proposes to
increase the complex order taker fee in the Non-Select Penny Pilot
Symbols for Market Maker, Firm Proprietary/Broker-Dealer and
Professional Customer orders, from $0.35 per contract to $0.37 per
contract. The Exchange is not proposing any change to the complex order
taker fee for Non-ISE Market Maker and Priority Customer orders in the
Non-Select Penny Pilot Symbols.
    For complex orders in the Non-Penny Pilot Symbols, the Exchange
currently charges a taker fee of: (i) $0.75 per contract for Market
Maker, Firm Proprietary/Broker-Dealer and Professional Customer orders,
and (ii) $0.78 per contract for Non-ISE Market Maker orders. Priority
Customer orders are not charged a taker fee for complex orders in the
Non-Penny Pilot Symbols. The Exchange now proposes to increase the
complex order taker fee in the Non-Penny Pilot Symbols for: (i) Market
Maker, Firm Proprietary/Broker-Dealer and Professional Customer orders,
from $0.75 per contract to $0.80 per contract, and (ii) Non-ISE Market
Maker orders, from $0.78 per contract to $0.83 per contract. The
Exchange is not proposing any change to the complex order taker fee for
Priority Customer orders in the Non-Penny Pilot Symbols.
    Additionally, the Exchange provides Market Makers with a two cent
discount when trading against Priority Customer orders that are
preferenced to them. This discount is applicable when Market Makers
remove liquidity from the complex order book in the Select Symbols, in
SPY, in the Non-Select Penny Pilot Symbols and in the Non-Penny Pilot
Symbols. Market Makers that remove liquidity in the Select Symbols, in
SPY, in the Non-Select Penny Pilot Symbols and in the Non-Penny Pilot
Symbols from the complex order book by trading with Priority Customer
orders that are preferenced to them will continue to receive a two cent
discount.
    Further, the Exchange currently provides volume-based tiered
rebates for Priority Customer complex orders in the Select Symbols
(excluding SPY), in SPY, in the Non-Select Penny Pilot Symbols and in
the Non-Penny Pilot Symbols when these orders trade with non-Priority
Customer orders in the complex order book. In order to enhance the
Exchange's competitive position and to incentivize Members to increase
the amount of Priority Customer complex orders in the Select Symbols
(excluding SPY), in SPY, in the Non-Select Penny Pilot Symbols and in
the Non-Penny Pilot Symbols that they send to the Exchange, the
Exchange now proposes to increase the rebate levels for these volume-
based tiers. In the Select Symbols (excluding SPY), the Exchange
currently provides a rebate of $0.32 per contract, per leg, for
Priority Customer complex orders when these orders trade with non-
Priority Customer complex orders in the complex order book.
Additionally, Members who achieve a certain level of average daily
volume (ADV) of executed Priority Customer complex order contracts
across all symbols during a calendar month are provided a rebate of
$0.33 per contract, per leg, in these symbols, if a Member achieves an
ADV of 75,000 Priority Customer complex order contracts; $0.34 per
contract, per leg, in these symbols, if a Member achieves an ADV of
125,000 Priority Customer complex order contracts; and $0.35 per
contract, per leg, in these symbols, if a Member achieves an ADV of
250,000 Priority Customer complex order contracts. The highest rebate
amount achieved by the Member for the current calendar month applies
retroactively to all Priority Customer complex order contracts that
trade with non-Priority Customer complex orders in the complex order
book executed by the Member during such calendar month. The Exchange
now proposes to increase the rebate levels applicable to the Select
Symbols (excluding SPY), as follows: (i) Increase the base rebate
level, from $0.32 per contract, per leg, to $0.34 per contract, per
leg, (ii) increase the rebate level, from $0.33 per contract, per leg,
to $0.36 per contract, per leg, for Members who achieve an ADV of
75,000 Priority Customer complex order contracts, (iii) increase the
rebate level, from $0.34 per contract, per leg, to $0.37 per contract,
per leg, for Members who achieve an ADV of 125,000 Priority Customer
complex order contracts, and (iv) increase the rebate level, from $0.35
per

contract, per leg, to $0.38 per contract, per leg, for Members who
achieve an ADV of 250,000 Priority Customer complex order contracts.
    In SPY, the Exchange currently provides a rebate of $0.33 per
contract, per leg, for Priority Customer complex orders when these
orders trade with non-Priority Customer complex orders in the complex
order book. Additionally, Members who achieve a certain level of ADV of
executed Priority Customer complex order contracts in SPY during a
calendar month are provided a rebate of $0.34 per contract, per leg, if
a Member achieves an ADV of 75,000 Priority Customer complex order
contracts; $0.35 per contract, per leg, if a Member achieves an ADV of
125,000 Priority Customer complex order contracts; and $0.36 per
contract, per leg, if a Member achieves an ADV of 250,000 Priority
Customer complex order contracts. The highest rebate amount achieved by
the Member for the current calendar month applies retroactively to all
Priority Customer complex order contracts that trade with non-Priority
Customer complex orders in the complex order book executed by the
Member during such calendar month. The Exchange now proposes to
increase the rebate levels applicable to SPY, as follows: (i) Increase
the base rebate level, from $0.33 per contract, per leg, to $0.36 per
contract, per leg, (ii) increase the rebate level, from $0.34 per
contract, per leg, to $0.37 per contract, per leg, for Members who
achieve an ADV of 75,000 Priority Customer complex order contracts,
(iii) increase the rebate level, from $0.35 per contract, per leg, to
$0.38 per contract, per leg, for Members who achieve an ADV of 125,000
Priority Customer complex order contracts, and (iv) increase the rebate
level, from $0.36 per contract, per leg, to $0.39 per contract, per
leg, for Members who achieve an ADV of 250,000 Priority Customer
complex order contracts.
    In Non-Select Penny Pilot Symbols, the Exchange currently provides
a rebate of $0.29 per contract, per leg, for Priority Customer complex
orders when these orders trade with non-Priority Customer complex
orders in the complex order book. Additionally, Members who achieve a
certain level of ADV of executed Priority Customer complex order
contracts in the Non-Select Penny Pilot Symbols during a calendar month
are provided a rebate of $0.31 per contract, per leg, in these symbols,
if a Member achieves an ADV of 75,000 Priority Customer complex order
contracts; $0.33 per contract, per leg, in these symbols, if a Member
achieves an ADV of 125,000 Priority Customer complex order contracts;
and $0.34 per contract, per leg, in these symbols, if a Member achieves
an ADV of 250,000 Priority Customer complex order contracts. Again, the
highest rebate amount achieved by the Member for the current calendar
month applies retroactively to all Priority Customer complex order
contracts that trade with non-Priority Customer complex orders in the
complex order book executed by the Member during such calendar month.
The Exchange now proposes to increase the rebate levels applicable to
the Non-Select Penny Pilot Symbols, as follows: (i) Increase the base
rebate level, from $0.29 per contract, per leg, to $0.33 per contract,
per leg, (ii) increase the rebate level, from $0.31 per contract, per
leg, to $0.34 per contract, per leg, for Members who achieve an ADV of
75,000 Priority Customer complex order contracts, (iii) increase the
rebate level, from $0.33 per contract, per leg, to $0.36 per contract,
per leg, for Members who achieve an ADV of 125,000 Priority Customer
complex order contracts, and (iv) increase the rebate level, from $0.34
per contract, per leg, to $0.37 per contract, per leg, for Members who
achieve an ADV of 250,000 Priority Customer complex order contracts.
    In the Non-Penny Pilot Symbols, the Exchange currently provides a
rebate of $0.62 per contract, per leg, for Priority Customer complex
orders when these orders trade with non-Priority Customer complex
orders in the complex order book. Additionally, Members who achieve a
certain level of ADV of executed Priority Customer complex order
contracts in the Non-Penny Pilot Symbols during a calendar month are
provided a rebate of $0.64 per contract, per leg, in these symbols, if
a Member achieves an ADV of 75,000 Priority Customer complex order
contracts; $0.66 per contract, per leg, in these symbols, if a Member
achieves an ADV of 125,000 Priority Customer complex order contracts;
and $0.67 per contract, per leg, in these symbols, if a Member achieves
an ADV of 250,000 Priority Customer complex order contracts. Again, the
highest rebate amount achieved by the Member for the current calendar
month applies retroactively to all Priority Customer complex order
contracts that trade with non-Priority Customer complex orders in the
complex order book executed by the Member during such calendar month.
The Exchange now proposes to increase the rebate levels applicable to
the Non-Penny Pilot Symbols, as follows: (i) Increase the base rebate
level, from $0.62 per contract, per leg, to $0.66 per contract, per
leg, (ii) increase the rebate level, from $0.64 per contract, per leg,
to $0.70 per contract, per leg, for Members who achieve an ADV of
75,000 Priority Customer complex order contracts, (iii) increase the
rebate level, from $0.66 per contract, per leg, to $0.74 per contract,
per leg, for Members who achieve an ADV of 125,000 Priority Customer
complex order contracts, and (iv) increase the rebate level, from $0.67
per contract, per leg, to $0.76 per contract, per leg, for Members who
achieve an ADV of 250,000 Priority Customer complex order contracts.
    Further, the Exchange currently provides a rebate of $0.06 per
contract, per leg, for Priority Customer complex orders in all symbols
traded on the Exchange (excluding SPY) when these orders trade against
quotes or orders in the regular orderbook. In order to enhance the
Exchange's competitive position and to incentivize Members to increase
the amount of Priority Customer complex orders that they send to the
Exchange, the Exchange is proposing to adopt volume-based tiers similar
to the volume-based tiers currently in place for complex orders that
trade with non-Priority Customer complex orders in the complex order
book. While keeping the base rebate at $0.06 per contract, per leg, the
Exchange proposes to adopt increased rebates, as follows: (i) Increase
the rebate level, from $0.06 per contract, per leg, to $0.07 per
contract, per leg, for Members who achieve an ADV of 75,000 executed
Priority Customer complex contracts, (ii) increase the rebate level,
from $0.06 per contract, per leg, to $0.08 per contract, per leg, for
Members who achieve an ADV of 125,000 executed Priority Customer
complex contracts, and (iii) increase the rebate level, from $0.06 per
contract, per leg, to $0.09 per contract, per leg, for Members who
achieve an ADV of 250,000 executed Priority Customer complex contracts.
The highest rebate amount achieved by the Member for the current
calendar month shall apply retroactively to all Priority Customer
complex order contracts that trade against quotes or orders in the
regular orderbook during such calendar month.
    For SPY, the Exchange currently provides a rebate of $0.07 per
contract, per leg, for Priority Customer complex orders when these
orders trade against quotes or orders in the regular orderbook. The
Exchange now proposes to adopt volume-based tiers for options on SPY,
similar to the volume-based tiers currently in place for complex orders
that trade with non-Priority Customer complex orders in the complex
order book. While keeping the

base rebate at $0.07 per contract, per leg, the Exchange proposes to
adopt increased rebates, as follows: (i) Increase the rebate level,
from $0.07 per contract, per leg, to $0.08 per contract, per leg, for
Members who achieve an ADV of 75,000 executed Priority Customer complex
contracts, (ii) increase the rebate level, from $0.07 per contract, per
leg, to $0.09 per contract, per leg, for Members who achieve an ADV of
125,000 executed Priority Customer complex contracts, and (iii)
increase the rebate level, from $0.07 per contract, per leg, to $0.10
per contract, per leg, for Members who achieve an ADV of 250,000
executed Priority Customer complex contracts. Again, the highest rebate
amount achieved by the Member for the current calendar month shall
apply retroactively to all Priority Customer complex order contracts in
SPY that trade against quotes or orders in the regular orderbook during
such calendar month.
    Finally, pursuant to Securities and Exchange Commission (``SEC'')
approval, the Exchange currently allows Market Makers to enter
quotations for complex order strategies in the complex order book.\10\
Given this enhancement to the complex order functionality, and in order
to maintain a competitive fee and rebate structure for Priority
Customer orders, the Exchange has adopted maker fees that apply to
transactions in the complex order book when they interact with Priority
Customer orders in options overlying AA, ABX, EFA, GLD, MSFT, MU, NVDA,
VXX, VZ, WFC, XLB and XOP (``Complex Quoting Symbols''). Specifically,
the Exchange currently charges a maker fee of $0.35 per contract for
Market Maker, Non-ISE Market Maker, Firm Proprietary/Broker-Dealer and
Professional Customer orders when these orders interact with Priority
Customer orders in the Complex Quoting Symbols. Priority Customer
orders in the Complex Quoting Symbols that trade in the complex order
book are not charged a fee and do not receive a rebate when interacting
with other Priority Customer orders.
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    \10\ See Securities Exchange Act Release No. 65548 (October 13,
2011), 76 FR 64980 (October 19, 2011) (SR-ISE-2011-39).
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    The Exchange now proposes to increase the maker fee for Market
Maker, Non-ISE Market Maker, Firm Proprietary/Broker-Dealer and
Professional Customer orders in the Complex Quoting Symbols from $0.35
per contract to $0.37 per contract when these orders interact with
Priority Customer orders in the complex order book. The Exchange does
not propose any change to fees for Priority Customer orders in the
Complex Quoting Symbols that trade in the complex order book.
Additionally, the Exchange provides Market Makers with a two cent
discount when trading against Priority Customer orders that are
preferenced to them. This discount is applicable when Market Makers add
or remove liquidity from the complex order book in the Complex Quoting
Symbols. The Exchange does not propose any change to this discount. As
such, Market Makers will continue to receive the two cent discount.
2. Statutory Basis
    The Exchange believes that its proposal to amend its Schedule of
Fees is consistent with Section 6(b) of the Securities and Exchange Act
of 1934 (the ``Act'') \11\ in general, and furthers the objectives of
Section 6(b)(4) of the Act \12\ in particular, in that it is an
equitable allocation of reasonable dues, fees and other charges among
Exchange members and other persons using its facilities. The impact of
the proposal upon the net fees paid by a particular market participant
will depend on a number of variables, most important of which will be
its propensity to add or remove liquidity in options overlying the
Select Symbols, the Non-Select Penny Pilot Symbols, the Non-Penny Pilot
Symbols, the Complex Quoting Symbols and SPY.
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    \11\ 15 U.S.C. 78f(b).
    \12\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that its proposal to assess a $0.32 per
contract taker fee for regular Market Maker and Market Maker Plus
orders in the Select Symbols is reasonable and equitably allocated
because the fee is within the range of fees assessed by other exchanges
employing similar pricing schemes. For example, NASDAQ OMX PHLX, Inc.
(``PHLX'') currently charges $0.39 per contract for Specialist and
Market Maker orders in its regular order book.\13\ The Exchange also
notes that with this proposed rule change, the fee charged to regular
Market Maker and Market Maker Plus orders in the Select Symbols will
remain lower than the fee currently charged by the Exchange to certain
other market participants.
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    \13\ See PHLX Fee Schedule at http://www.nasdaqtrader.com/content/marketregulation/membership/phlx/feesched.pdf.
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    The Exchange also believes that its proposal to assess a $0.33 per
contract taker fee for regular Firm Proprietary/Broker-Dealer and
Professional Customer orders and $0.36 per contract taker fee for
regular Non-ISE Market Maker orders in the Select Symbols is reasonable
and equitably allocated because the fee is also within the range of
fees assessed by other exchanges employing similar pricing schemes. By
comparison, the proposed fees assessed to regular Firm Proprietary/
Broker-Dealer and Professional Customer orders and to regular Non-ISE
Market Maker orders are lower than the rates assessed by PHLX for
similar orders. PHLX currently charges a taker fee of $0.45 per
contract for equivalent orders in its regular order book.\14\
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    \14\ Id.
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    The Exchange also believes that its proposal to assess a $0.25 per
contract taker fee for all regular Priority Customer orders in the
Select Symbols is reasonable and equitably allocated because the fee is
within the range of fees assessed by other exchanges employing similar
pricing schemes. The proposed fee is substantially lower than the $0.39
per contract taker fee currently charged by PHLX for Customer orders in
its regular order book.\15\ Therefore, while ISE is proposing a fee
increase, the resulting fee remains lower than the fee currently
charged by PHLX. Further, the proposed increase will bring this fee
closer to the fee the Exchange currently charges to other market
participants. The Exchange also notes, however, that with this proposed
rule change, the fee charged to regular Priority Customer orders will
remain lower (as it historically has always been) than the fee
currently charged by the Exchange to other market participants.
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    \15\ Id.
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    The Exchange believes that the price differentiation between the
various market participants is justified because Market Makers have
obligations to the market that the other market participants do not.
The Exchange believes that, in this instance, it is equitable to assess
a higher fee to market participants that do not have the quoting
requirements that Exchange Market Makers have. While ISE is proposing
fee increases for Market Maker, Market Maker Plus, Non-ISE Market
Maker, Firm Proprietary/Broker-Dealer, Professional Customer and
Priority Customer orders in the Select Symbols, the resulting fees
remain lower than the fees currently charged by PHLX for similar
orders.
    The Exchange believes that its proposal to assess a $0.37 per
contract taker fee for Market Maker, Firm Proprietary/Broker-Dealer and
Professional Customer complex orders, and $0.39 per contract for Non-
ISE Market Maker complex orders, in the Select Symbols (excluding SPY)
is reasonable and equitably allocated because the fee is within the
range of

fees assessed by other exchanges employing similar pricing schemes and
in some cases, is lower that the fees assessed by other exchanges. For
example, PHLX currently charges $0.39 per contract for removing
liquidity in complex orders for Specialist, Market Maker, Firm, Broker-
Dealer and Professional orders.\16\ Therefore, while ISE is proposing a
fee increase for Market Maker, Firm Proprietary/Broker-Dealer and
Professional Customer orders, the resulting fee will remain lower than
the fee currently charged by PHLX for similar orders, while the
resulting fee from the proposed fee increase for Non-ISE Market Maker
orders will be equal to the fee currently charged by PHLX for similar
orders. In addition, the Exchange believes that charging Non-ISE Market
Maker orders a higher rate than the fee charged to Market Maker, Firm
Proprietary/Broker-Dealer and Professional Customer complex orders is
appropriate and not unfairly discriminatory because Non-ISE Market
Makers are not subject to many of the non-transaction based fees that
these other categories of membership are subject to, e.g., membership
fees, access fees, API/Session fees, market data fees, etc. Therefore,
in this instance, it is appropriate and not unfairly discriminatory to
assess a higher transaction fee to Non-ISE Market Makers because the
Exchange incurs costs associated with these types of orders that are
not recovered by non-transaction based fees paid by members.
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    \16\ Id.
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    The Exchange believes that its proposal to increase the taker fee
to $0.38 per contract for ISE Market Maker, Firm Proprietary/Broker-
Dealer and Professional Customer complex orders, and to increase the
taker fee to $0.40 per contract for Non-ISE Market Maker complex
orders, in SPY is reasonable because the fee is within the range of
fees assessed by other exchanges employing similar pricing schemes. For
example, PHLX currently charges $0.39 per contract for removing
liquidity in complex orders in SPY for Specialist, Market Maker, Firm,
Broker-Dealer and Professional orders.\17\ Therefore, while ISE is
proposing fees increases for Market Maker, Firm Proprietary/Broker-
Dealer and Professional Customer complex orders, the resulting fees
will remain lower than the fees currently charged by PHLX for similar
orders, while the resulting fee from the proposed fee increase for Non-
ISE Market Maker complex orders will only be marginally higher than the
fee currently charged by PHLX for similar orders. In addition, the
Exchange believes that charging Non-ISE Market Maker complex orders a
higher rate than the fee charged to Market Maker, Firm Proprietary/
Broker-Dealer and Professional Customer complex orders in SPY is
appropriate and not unfairly discriminatory because Non-ISE Market
Makers are not subject to many of the non-transaction based fees that
these other categories of membership are subject to, e.g., membership
fees, access fees, API/Session fees, market data fees, etc. Therefore,
in this instance, it is appropriate and not unfairly discriminatory to
assess a higher transaction fee on Non-ISE Market Makers because the
Exchange incurs costs associated with these types of orders that are
not recovered by non-transaction based fees paid by members.
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    \17\ Id.
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    The Exchange believes that its proposal to assess a $0.37 per
contract taker fee for Market Maker, Firm Proprietary/Broker-Dealer and
Professional Customer complex orders in the Non-Select Penny Pilot
Symbols is reasonable and equitably allocated because the fee is within
the range of fees assessed by other exchanges employing similar pricing
schemes. For example, PHLX currently charges $0.22 per contract plus a
payment for order flow fee of $0.25 per contract (applicable to
customer orders), for a total rate of $0.47 per contract for adding and
removing liquidity in complex orders for Specialist and Market Maker
orders and charges anywhere from $0.25 per contract to $0.45 per
contract for Firm, Broker-Dealer and Professional orders.\18\
---------------------------------------------------------------------------

    \18\ Id.
---------------------------------------------------------------------------

    The Exchange believes it is reasonable and equitable to charge
Market Maker, Firm Proprietary/Broker-Dealer and Professional Customer
complex orders a taker fee of $0.80 per contract, and to charge Non-ISE
Market Maker orders a taker fee of $0.83 per contract for complex
orders in the Non-Penny Pilot Symbols because the Exchange is seeking
to recoup the cost associated with paying a higher per contract rebate
to Priority Customers. In addition, the Exchange believes that charging
Non-ISE Market Maker orders a higher rate than the fee charged to
Market Maker, Firm Proprietary/Broker-Dealer and Professional Customer
complex orders in the Non-Penny Pilot Symbols is appropriate and not
unfairly discriminatory because Non-ISE Market Makers are not subject
to many of the non-transaction based fees that these other categories
of membership are subject to, e.g., membership fees, access fees, API/
Session fees, market data fees, etc. Therefore, in this instance, it is
appropriate and not unfairly discriminatory to assess a higher
transaction fee on Non-ISE Market Makers because the Exchange incurs
costs associated with these types of orders that are not recovered by
non-transaction based fees paid by members.
    The Exchange believes that increasing the fees applicable to orders
executed in the complex order book when trading against Priority
Customer orders in the Complex Quoting Symbols is appropriate given the
functionality developed by the Exchange that allows market makers to
quote in the complex order book. Specifically, the Exchange believes
that its proposal to assess a maker fee of $0.37 per contract for the
Complex Quoting Symbols when orders in these symbols interact with
Priority Customer orders is reasonable and equitable because the fee is
within the range of fees assessed by other exchanges employing similar
pricing schemes. In fact, the proposed fee is considerably less than
that charged by other exchanges. For example, the maker fee for a
broker-dealer complex order in XOP at PHLX is $0.60 per contract \19\
while the same order that is electronically delivered at the Chicago
Board Options Exchange (``CBOE'') is $0.45 per contract.\20\
Additionally, one of the primary goals of this fee change is to
maintain the attractive and competitive economics for Priority Customer
complex orders, in light of the enhanced manner in which complex orders
now trade on the Exchange.
---------------------------------------------------------------------------

    \19\ Id.
    \20\ See CBOE Fees Schedule, at http://www.cboe.com/publish/feeschedule/CBOEFeeSchedule.pdf.
---------------------------------------------------------------------------

    The Exchange believes that it is reasonable and equitable to
provide a two cent discount to Market Makers on preferenced orders as
an incentive for them to quote in the complex order book. Accordingly,
Market Makers who remove liquidity in the Select Symbols, the Non-
Select Penny Pilot Symbols, the Non-Penny Pilot Symbols, the Complex
Quoting Symbols and SPY from the complex order book will be charged
$0.02 less per contract when trading with Priority Customer orders that
are preferenced to them. ISE notes that with this proposed fee change,
the Exchange will continue to maintain a two cent differential that was
previously in place.
    The Exchange believes that it is reasonable and equitable to
provide rebates for Priority Customer complex orders when these orders
trade with Non-Priority Customer complex orders in the complex order
book because

paying a rebate would continue to attract additional order flow to the
Exchange and create liquidity in the symbols that are subject to the
rebate, which the Exchange believes ultimately will benefit all market
participants who trade on ISE. The Exchange already provides these
types of rebates, and is now merely proposing to increase those rebate
amounts. The Exchange believes that the proposed rebates are
competitive with rebates provided by other exchanges and are therefore
reasonable and equitably allocated to those members that direct orders
to the Exchange rather than to a competing exchange.
    The Exchange also believes that it is reasonable and equitable to
provide rebates for Priority Customer complex orders when these orders
trade against quotes or orders in the regular orderbook. Again, the
Exchange already provides this rebate and is now proposing to increase
those rebate amounts through volume-based tiers. The Exchange believes
paying these rebates would also attract additional order flow to the
Exchange.
    The complex order pricing employed by the Exchange has proven to be
an effective pricing mechanism and attractive to Exchange participants
and their customers. The Exchange believes that this proposed rule
change will continue to attract additional complex order business in
the symbols that are subject of this proposed rule change.
    Moreover, the Exchange believes that the proposed fees are fair,
equitable and not unfairly discriminatory because the proposed fees are
consistent with price differentiation that exists today at other
options exchanges. Additionally, the Exchange believes it remains an
attractive venue for market participants to direct their order flow in
the symbols that are subject to this proposed rule change as its fees
are competitive with those charged by other exchanges for similar
trading strategies. The Exchange operates in a highly competitive
market in which market participants can readily direct order flow to
another exchange if they deem fee levels at a particular exchange to be
excessive. For the reasons noted above, the Exchange believes that the
proposed fees are fair, equitable and not unfairly discriminatory.

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.\21\ 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.
---------------------------------------------------------------------------

    \21\ 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_ADDRESS>Please include
File Number SR-ISE-2012-71 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-2012-71. 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-2012-71 and should be
submitted on or before September 5, 2012.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\22\
---------------------------------------------------------------------------

    \22\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-19979 Filed 8-14-12; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: April 1, 2008 (Volume 73, Number 63)]
[Notices]
[Page 17413-17414]
[DOCID:fr01ap08-98]

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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

Reports, Forms, and Record Keeping Requirements

AGENCY: National Highway Traffic Safety Administration, DOT.

ACTION: Notice.

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

SUMMARY: In compliance with the Paperwork Reduction Act of 1995 (44
U.S.C. 3501 et seq.), this notice announces that the Information
Collection Request (ICR) abstracted below has been forwarded to the
Office of Management and Budget (OMB) for review and comment. The ICR
describes the nature of the information collections and their expected
burden. The Federal Register Notice with a 60-day comment period was
published on October 2, 2007 (72 FR 56027). The agency received no
comments.

DATES: Comments must be submitted on or before May 1, 2008.

ADDRESSES: Send comments, within 30 days, to the Office of Information
and Regulatory Affairs, Office of Management and Budget, 725-17th
Street, NW., Washington, DC 20503, Attention NHTSA Desk Officer.
    Comments are invited on: Whether the proposed collection of
information is necessary for the proper performance of the functions of
the Department, including whether the information will have practical
utility; the accuracy of the Department's estimate of the burden of the
proposed information collection; ways to enhance the quality, utility
and clarity of the information to be collected; and ways to minimize
the

burden of the collection of information on respondents, including the
use of automated collection techniques or other forms of information
technology. A comment to OMB is most effective if OMB receives it
within 30 days of publication.

FOR FURTHER INFORMATION CONTACT: Ms. Deborah Mazyck at the National
Highway Traffic Safety Administration, Office of International Policy,
Fuel Economy and Consumer Programs, 1200 New Jersey Avenue, SE., West
Building, Room W43-443, NVS 131, Washington, DC 20590. Ms. Mazyck's
telephone number is<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

National Highway Traffic Safety Administration

    Title: Consolidated Labeling Requirements for 49 CFR Parts 565,
541, and 567.
    OMB Number: 2127-0510.
    Type of Request: Request for public comment on a previously
approved collection of information.
    Abstract:

Parts 565 and 567

    NHTSA's statute at 15 U.S.C. 1392, 1397, 1401, 1407, and 1412 of
the National Traffic and Motor Vehicle Safety Act of 1966 authorizes
the issuance of Federal Motor Vehicle Safety Standard (FMVSS) and the
collection of data which support their implementation. The agency, in
prescribing an FMVSS, is to consider available relevant motor vehicle
safety data and to consult with other agencies as it deems appropriate.
Further, the Act mandates, that in issuing any FMVSS, the agency should
consider whether the standard is reasonable, practicable and
appropriate for the particular type of motor vehicle or item of motor
vehicle equipment for which it is prescribed, and whether such
standards will contribute to carrying out the purpose of the Act. The
Secretary is authorized to revoke such rules and regulations as deemed
necessary to carry out this subchapter. Using this authority, the
agency issued the initial FMVSS No. 115, Vehicle Identification Number,
specifying requirements for vehicle identification numbers to aid the
agency in achieving many of its safety goals.
    The standard was amended in August 1978 by extending its
applicability to additional classes of motor vehicles and by specifying
the use of a 30-year, 17-character Vehicle Identification Number (VIN)
for worldwide use. The standard was amended in May 1983 by deleting
portions of FMVSS No. 115 and reissuing those portions as a general
agency regulation, Part 565. Subsequently, the standard was amended
again in June 1996 transferring the text of the FMVSS No. 115 to Part
565, without making any substantive changes to the VIN requirements as
a result of the proposed consolidation. The provision of the Part 565
(amended) regulation requires vehicle manufacturers to assign a unique
VIN to each new vehicle and to inform NHTSA of the code used in forming
the VIN. These regulations apply to all vehicles: passenger cars,
multipurpose passenger vehicles, trucks, buses, trailers, incomplete
vehicles, and motorcycles.
    NHTSA has proposed amendments to Part 565 to revise certain
sections in order to extend the existing VIN system for another thirty
years, and to ensure a sufficient supply of unique available VINs and
manufacturer identifiers for that time period (72 FR 56027, October 2,
2007). The agency may require information to be provided in a slightly
different way (e.g., vehicle make being transferred from the first to
the second section of the VIN), the scope of the overall reporting
requirement of Part 565 will not change. The agency does not anticipate
an increase or decrease in the collection of information requirements
if these proposals are adopted.
    Part 567 specifies the content and location of, and other
requirements for, the certification label or tag to be affixed to motor
vehicles and motor vehicle equipment. Specifically, the VIN is required
to appear on the certification label. Additionally, this certificate
will provide the consumer with information to assist him or her in
determining which of the FMVSS are applicable to the vehicle or
equipment, and its date of manufacture.
    NHTSA estimates the vehicle manufacturers will incur a decrease in
total annual hour burden of 423,333. The recordkeeping hour burden for
Part 565 and 567 represents a decrease in hour burden because of a
decrease in the number of respondents.
    NHTSA estimates an increase in cost burden of $3,400.00. Due to the
fluctuation of the U.S. economy, there was an increase in cost to
comply with the reporting requirements. The change in cost burden
reflects the 2007 Consumer Price Index as compared to that of 1987.

Part 541

    The Motor Vehicle Information and Cost Savings Act was amended by
the Anti-Car Theft Act of 1992 (Pub. L. 102-519). The enacted Theft Act
requires specified parts of high-theft vehicles to be marked with
vehicle identification numbers. In a final rule published on April 6,
2004, the Federal Motor Vehicle Theft Prevention Standard was extended
to include all passenger cars and multipurpose passenger vehicles with
a gross vehicle weight rating of 6,000 pounds or less, and to light
duty trucks with major parts that are interchangeable with a majority
of the covered major parts of multipurpose passenger vehicles. Each
major component part must be either labeled or affixed with the VIN and
its replacement component part must be marked with the DOT symbol, the
letter (R) and the manufacturers' logo. On May 19, 2005, in response to
petitions for reconsideration, NHTSA amended the final rule. The final
rule became effective September 1, 2006. Due to expansion of the Theft
Prevention Standard (Part 541), all passenger cars, and multipurpose
passenger vehicles with a gross vehicle weight rating of 6,000 pounds
or less, and to light duty trucks with major parts that are
interchangeable with a majority of the covered major parts of
multipurpose passenger vehicles, are required them to be parts marked.
This creates a program change for this collection.
    Part 541 shows an increase in recordkeeping costs because there
will be a greater number of vehicles required to be parts marked
resulting in an additional cost of affixing labels or stamping the VIN
on motor vehicles and startup costs for the manufacturers. NHTSA
estimates the vehicle manufacturers will incur a total cost burden of
$87,550,100 million. NHTSA estimates a decrease in reporting and
recordkeeping hours because current estimates are based on fewer
vehicles complying with the Theft Prevention Standard. However, there
is an increase in the number of target area submissions per vehicle
required by vehicle manufacturers. NHTSA estimates the vehicle
manufacturers will incur a net decrease for a total annual hour burden
of 502,519.
    Affected Public: Motor vehicle manufacturers.
    Estimated Total Annual Burden: NHTSA estimates that the overall
total estimated annual hour burden for this collection is 925,852. The
overall total estimated cost burden for this collection is $87,553,500
million.

    Issued on: March 26, 2008.
Stephen R. Kratzke,
Associate Administrator for Rulemaking.
 [FR Doc. E8-6622 Filed 3-31-08; 8:45 am]

BILLING CODE 4910-59-P


[Federal Register Volume 79, Number 163 (Friday, August 22, 2014)]
[Rules and Regulations]
[Pages 49685-49686]
[FR Doc No: 2014-19989]

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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[Docket No. USCG-2012-1036]

Safety Zones; Recurring Marine Events in Captain of the Port Long
Island Sound Zone

AGENCY: Coast Guard, DHS.

ACTION: Notice of enforcement of regulation.

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

SUMMARY: The Coast Guard will enforce a safety zone for a fireworks
display in the Sector Long Island Sound area of responsibility on
August 30-31, 2014. This action is necessary to provide for the safety
of life on navigable waterways during the event. During the enforcement
period, no person or vessel may enter the safety zone without
permission of the Captain of the Port (COTP) Sector Long Island Sound
or designated representative.

DATES: The regulations for the marine event listed in Table 1 to 33 CFR
165.151(9.3) will be enforced on August 30, 2014 and August 31, 2014
from 8:30 p.m. to 9:40 p.m.

FOR FURTHER INFORMATION CONTACT: If you have questions on this notice,
call or email Petty Officer Ian Fallon, Waterways Management Division,
U.S. Coast Guard Sector Long Island Sound; telephone<PHONE_NUMBER>,
email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION: The Coast Guard will enforce the safety zone
listed in Table 1 to 33 CFR 165.151(9.3) on the specified dates and
times as indicated below. The final rule establishing this safety zone
was published in the Federal Register on May 24, 2013 (78 FR 31402).

                        Table 1 to Sec.  165.151
------------------------------------------------------------------------

------------------------------------------------------------------------
9.3 Village of Island Park Labor Day      Date: August 30, 2014.
 Celebration Fireworks.                   Rain Date: August 31,
                                          2014.
                                          Time: 8:30 p.m. to
                                          9:40 p.m.
                                          Location: Waters off
                                          Village of Island Park Fishing
                                          Pier, Village Beach, NY in
                                          approximate position
                                          40[deg]36'30.95'' N.,
                                          073[deg]39'22.23'' W. (NAD
                                          83).
------------------------------------------------------------------------

    Under the provisions of 33 CFR 165.151, the fireworks display
listed above is established as a safety zone. During the enforcement
period, persons and vessels are prohibited from entering into,
transiting through, mooring, or

anchoring within the safety zone unless they receive permission from
the COTP or designated representative This notice is issued under
authority of 33 CFR 165 and 5 U.S.C. 552(a). In addition to this notice
in the Federal Register, the Coast Guard will provide the maritime
community with advance notification of this enforcement period via the
Local Notice to Mariners or marine information broadcasts. If the COTP
determines that the safety zone need not be enforced for the full
duration stated in this notice, a Broadcast Notice to Mariners may be
used to grant general permission to enter the safety zone.

    Dated: August 8, 2014.
E. J. Cubanski III,
Captain, U.S. Coast Guard, Captain of the Port Sector Long Island
Sound.
[FR Doc. 2014-19989 Filed 8-21-14; 8:45 am]
BILLING CODE 9110-04-P