[Federal Register Volume 84, Number 249 (Monday, December 30, 2019)]
[Notices]
[Pages 72056-72060]
[FR Doc No: 2019-28028]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87820; File No. SR-NASDAQ-2019-097]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Adopt a New Rule Titled ``Off-Exchange RWA Transfers'' at Options 6,
Section 6

December 20, 2019.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on December 17, 2019, The Nasdaq Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``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 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 Exchange proposes to adopt a new rule titled ``Off-Exchange RWA
Transfers'' at The Nasdaq Options Market LLC (``NOM'') Rules at Options
6, Section 6. The text of the proposed rule change is available on the
Exchange's website at http://nasdaq.cchwallstreet.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 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
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to adopt a new rule titled, ``Off-Exchange
RWA Transfers'' at NOM Options 6, Section 6. This proposal is
substantially the same as Cboe Exchange, Inc. (``Cboe'') Rule 6.8.\3\
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    \3\ See Securities Exchange Act Release No. 87374 (October 21,
2019), 84 FR 57542 (October 25, 2019) (SR-Cboe-2019-044).
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    Proposed Options 6, Section 6 is intended to facilitate the
reduction of risk-weighted assets (``RWA'') attributable to open
options positions. SEC Rule 15c3-1 (Net Capital Requirements for
Brokers or Dealers) (``Net Capital Rules'') requires registered broker-
dealers, unless otherwise excepted, to maintain certain specified
minimum levels of capital.\4\ The Net Capital Rules are designed to
protect securities customers, counterparties, and creditors by
requiring that broker-dealers have sufficient liquid resources on hand,
at all times, to meet their

financial obligations. Notably, hedged positions, including offsetting
futures and options contract positions, result in certain net capital
requirement reductions under the Net Capital Rules.\5\
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    \4\ 17 CFR 240.15c3-1.
    \5\ In addition, the Net Capital Rules permit various offsets
under which a percentage of an option position's gain at any one
valuation point is allowed to offset another position's loss at the
same valuation point (e.g., vertical spreads).
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    Subject to certain exceptions, Clearing Participants \6\ are
subject to the Net Capital Rules.\7\ However, a subset of Clearing
Participants are subsidiaries of U.S. bank holding companies, which,
due to their affiliations with their parent U.S.-bank holding
companies, must comply with additional bank regulatory capital
requirements pursuant to rulemaking required under the Dodd-Frank Wall
Street Reform and Consumer Protection Act.\8\ Pursuant to this mandate,
the Board of Governors of the Federal Reserve System, the Office of the
Comptroller of the Currency, and the Federal Deposit Insurance
Corporation have approved a regulatory capital framework for
subsidiaries of U.S. bank holding company clearing firms.\9\ Generally,
these rules, among other things, impose higher minimum capital and
higher asset risk weights than were previously mandated for Clearing
Participants that are subsidiaries of U.S. bank holding companies under
the Net Capital Rules. Furthermore, the new rules do not fully permit
deductions for hedged securities or offsetting options positions.\10\
Rather, capital charges under these standards are, in large part, based
on the aggregate notional value of short positions regardless of
offsets. As a result, in general, Clearing Participants that are
subsidiaries of U.S. bank holding companies must hold substantially
more bank regulatory capital than would otherwise be required under the
Net Capital Rules.
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    \6\ The term Clearing Participant is defined within Chapter I,
Section 1(a)(9). All Clearing Participants must also be clearing
members of The Options Clearing Corporation (``OCC'').
    \7\ In the event federal regulators modify bank capital
requirements in the future, the Exchange will reevaluate the
proposed rule change at that time to determine whether any
corresponding changes to the proposed rule are appropriate.
    \8\ H.R. 4173 (amending section 3(a) of the Securities Exchange
Act of 1934 (the ``Act'') (15 U.S.C. 78c(a))).
    \9\ 12 CFR 50; 79 FR 61440 (Liquidity Coverage Ratio: Liquidity
Risk Measurement Standards).
    \10\ Many options strategies, including relatively simple
strategies often used by retail customers and more sophisticated
strategies used by broker-dealers, are risk limited strategies or
options spread strategies that employ offsets or hedges to achieve
certain investment outcomes. Such strategies typically involve the
purchase and sale of multiple options (and may be coupled with
purchases or sales of the underlying securities), executed
simultaneously as part of the same strategy. In many cases, the
potential market exposure of these strategies is limited and
defined.
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    The Exchange is concerned with the ability of Market Makers to
provide liquidity in their appointed classes. The Exchange believes
that permitting market participants to efficiently transfer existing
options positions through an off-exchange transfer process would likely
have a beneficial effect on continued liquidity in the options market
without adversely affecting market quality. Liquidity in the listed
options market is critically important. The Exchange believes that the
proposed rule change provides market participants with an efficient
mechanism to transfer their open options positions from one clearing
account to another clearing account and thereby increase liquidity in
the listed options market. NOM currently has no mechanism that firms
may use to transfer positions between clearing accounts without having
to effect a transaction with another party and close a position.
    The proposed rule provides that existing positions in options
listed on the Exchange of a Participant or non-Participant (including
an affiliate of a Participant) may be transferred on, from, or to the
books of a Clearing Participant off the Exchange if the transfer
establishes a net reduction of RWA attributable to those options
positions (an ``RWA Transfer''). Proposed paragraph (a)(1) adds
examples of two transfers that would be deemed to establish a net
reduction of RWA, and thus qualify as a permissible RWA Transfer:
     A transfer of options positions from Clearing Corporation
\11\ member A to Clearing Corporation member B that net (offset) with
positions held at Clearing Corporation member B, and thus closes all or
part of those positions (as demonstrated in the example below) \12\;
and
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    \11\ The term Clearing Corporation is defined within Chapter I,
Section 1(a)(8).
    \12\ This transfer would establish a net reduction of RWA
attributable to the transferring Person, because there would be
fewer open positions and thus fewer assets subject to Net Capital
Rules.
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     A transfer of options positions from a bank-affiliated
Clearing Corporation member to a non-bank-affiliated Clearing
Corporation member.\13\
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    \13\ This transfer would establish a net reduction of RWA
attributable to the transferring Person, because the non-bank-
affiliated Clearing Corporation member would not be subject to Net
Capital Rules, as described above.
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    These transfers will not result in a change in ownership, as they
must occur between accounts of the same Person.
    ``Person'' is defined within proposed Options 6, Section 6(a) as an
individual, partnership (general or limited), joint stock company,
corporation, limited liability company, trust or unincorporated
organization, or any governmental entity or agency or political
subdivision thereof.
    In other words, RWA transfers may only occur between the same
individual or legal entity. These are merely transfers from one
clearing account to another, both of which are attributable to the same
individual or legal entity. A market participant effecting an RWA
Transfer is analogous to an individual transferring funds from a
checking account to a savings account, or from an account at one bank
to an account at another bank--the money still belongs to the same
person, who is just holding it in a different account for personal
financial reasons.
    For example, Market Maker A clears transactions on the Exchange
into an account it has with Clearing Participant X, which is affiliated
with a U.S-bank holding company. Market Maker A opens a clearing
account with Clearing Participant Y, which is not affiliated with a
U.S.-bank holding company. Clearing Participant X has informed Market
Maker A that its open positions may not exceed a certain amount at the
end of a calendar month, or it will be subject to restrictions on new
positions it may open the following month. On August 28, Market Maker A
reviews the open positions in its Clearing Participant X clearing
account and determines it must reduce its open positions to satisfy
Clearing Participant X's requirements by the end of August. It
determines that transferring out 1000 short calls in class ABC will
sufficiently reduce the RWA capital requirements in the account with
Clearing Participant X to avoid additional position limits in
September. Market Maker A wants to retain the positions in accordance
with its risk profile. Pursuant to the proposed rule change, on August
31, Market Maker A transfers 1000 short calls in class ABC to its
clearing account with Clearing Participant Y. As a result, Market Maker
A can continue to provide the same level of liquidity in class ABC
during September as it did in previous months.
    A Participant must give up a Clearing Participant for each
transaction it effects on the Exchange, which identifies the Clearing
Participant through which the transaction will clear.\14\ A Participant
may change the give up for a transaction

within a specified period of time.\15\ Additionally, a Participant may
also change the Clearing Participant\16\ for a specific transaction.
The transfer of positions from an account with one clearing firm to the
account of another clearing firm pursuant to the proposed rule change
has a similar result as changing a give up or CMTA, as it results in a
position that resulted from a transaction moving from the account of
one clearing firm to another, just at a different time and in a
different manner.\17\ In the above example, if Market Maker A had
initially given up Clearing Participant Y rather than Clearing
Participant X on the transactions that resulted in the 1000 long calls
in class ABC, or had changed the give-up or CMTA to Clearing
Participant Y pursuant to Options 6, Section 1 the ultimate result
would have been the same. There are a variety of reasons why firms give
up or CMTA transactions to certain clearing firms (and not to non-bank
affiliate clearing firms) at the time of a transaction, and the
proposed rule change provides firms with a mechanism to achieve the
same result at a later time.
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    \14\ See Options 5, Section 102.
    \15\ See Chapter VI, Section 14.
    \16\ The Clearing Member Trade Assignment (``CMTA'') process at
The Options Clearing Corporation (``OCC'') facilitates the transfer
of option trades/positions from one OCC clearing member to another
in an automated fashion. Changing a CMTA for a specific transaction
would allocate the trade to a different OCC clearing member than the
one initially identified on the trade.
    \17\ The transferred positions will continue to be subject to
OCC rules, as they will continue to be held in an account of an OCC
member.
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    Proposed paragraph (a)(2) states RWA Transfers may occur on a
routine, recurring basis. As noted in the example above, clearing firms
may impose restrictions on the amount of open positions. Permitting
transfers on a routine, recurring basis will provide market
participants with the flexibility to comply with these restrictions
when necessary to avoid position limits on future options activity.
Additionally, proposed paragraph (a)(6) provides that no prior written
notice to the Exchange is required for RWA Transfers. Because of the
potential routine basis on which RWA Transfers may occur, and because
of the need for flexibility to comply with the restrictions described
above, the Exchange believes it may interfere with the ability of
investors firms to comply with any Clearing Participant restrictions
describe above, and may be burdensome to provide notice for these
routine transfers.
    Proposed paragraph (a)(3) states RWA Transfers may result in the
netting of positions. Netting occurs when long positions and short
positions in the same series ``offset'' against each other, leaving no
or a reduced position. For example, if there were 100 long calls in one
account, and 100 short calls of the same option series were added to
that account, the positions would offset, leaving no open positions.
Currently, the Exchange permits off-exchange transfers on behalf of a
Market Maker account for transactions in multiply listed options series
on different exchanges, but only if the Market Maker nominees are
trading for the same Participant, and the options transactions on the
different options exchanges clear into separate exchange-specific
accounts because they cannot easily clear into the same Market Maker
account at OCC. In such instances, all Market Maker positions in the
exchange-specific accounts for the multiply listed class would be
automatically transferred on their trade date into one central Market
Maker account (commonly referred to as a ``universal account'') at the
Clearing Corporation. Positions cleared into a universal account would
automatically net against each other.
    While RWA Transfers are not occurring because of limitations
related to trading on different exchanges, similar reasoning for the
above exception applies to why netting should be permissible for the
limited purpose of reducing RWA. Firms may maintain different clearing
accounts for a variety of reasons, such as the structure of their
businesses, the manner in which they trade, their risk management
procedures, and for capital purposes. If a Market Maker clears all
transactions into a universal account, offsetting positions would
automatically net. However, if a Market Maker has multiple accounts
into which its transactions cleared, they would not automatically net.
While there are times when a firm may not want to close out open
positions to reduce RWA, there are other times when a firm may
determine it is appropriate to close out positions to accomplish a
reduction in RWA.
    In the example above, suppose after making the RWA Transfer
described above, Market Maker A effects a transaction on September 25
that results in 1000 long calls in class ABC, which clears into its
account with Clearing Participant X. If Market Maker A had not effected
its RWA Transfer in August, the 1000 long calls would have offset
against the 1000 short calls, eliminating both positions and thus any
RWA capital requirements associated with them. At the end of August,
Market Maker A did not want to close out the 1000 short calls when it
made its RWA Transfer. However, given changed circumstances in
September, Market Maker A has determined it no longer wants to hold
those positions. The proposed rule change would permit Market Maker A
to effect an RWA Transfer of the 1000 short calls from its account with
Clearing Participant Y to its account with Clearing Participant X (or
vice versa), which results in elimination of those positions (and a
reduction in RWA associated with them). As noted above, such netting
would have occurred if Market Maker A cleared the September transaction
directly into its account with Clearing Participant Y, or had not
effected an RWA Transfer in August. Netting provides market
participants with appropriate flexibility to conduct their businesses
as they see fit while having the ability to reduce RWA capital
requirements when necessary.
    RWA Transfers may not result in preferential margin or haircut
treatment.\18\ Additionally, RWA Transfers may only be effected for
options listed on the Exchange and will be subject to applicable laws,
rules, and regulations, including rules of other self-regulatory
organizations (including OCC).\19\
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    \18\ See proposed paragraph (a)(4).
    \19\ See proposed introductory paragraph and proposed paragraph
(a)(7). Transfers of non-Exchange listed options and other financial
instruments are not governed by this proposed rule. Any RWA
transfers will be subject to all applicable recordkeeping
requirements applicable to Participants and Clearing Participants
under the Securities Exchange Act of 1934, and the rules and
regulations thereunder (the ``Act''), such as Rule 17a-3 and 17a-4.
a [sic]
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    Finally, the Exchange notes it is reserving Sections 5 and 7 of
Options 6 for consistency in rule numbering with Nasdaq affiliated
markets.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\20\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\21\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest. Additionally, the Exchange believes the proposed rule change
is consistent with the Section 6(b)(5) \22\ requirement that the rules
of an exchange not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.

The Exchange's proposal is substantially the same as Cboe Rule 6.8
[sic]
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    \20\ 15 U.S.C. 78f(b).
    \21\ 15 U.S.C. 78f(b)(5).
    \22\ Id.
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    In particular, the Exchange believes the proposed rule change to
permit RWA Transfers will remove impediments to and perfect the
mechanism of a free and open market and a national market system by
providing liquidity in the listed options market. The Exchange believes
providing market participants with an efficient process to reduce RWA
capital requirements attributable to open positions in clearing
accounts with U.S. bank-affiliated clearing firms may contribute to
additional liquidity in the listed options market, which, in general,
protects investors and the public interest.
    The proposed rule change, in particular the proposed changes to
permit RWA transfers to occur on a routine, recurring basis and result
in netting, also provides market participants with sufficient
flexibility to reduce RWA capital requirements at times necessary to
comply with requirements imposed on them by clearing firms. This will
permit market participants to respond to then-current market
conditions, including volatility and increased volume, by reducing the
RWA capital requirements associated with any new positions they may
open while those conditions exist. Given the additional capital that
may become available to market participants as a result of the RWA
Transfers, market participants will be able to continue to provide
liquidity to the market, even during periods of increased volume and
volatility, which liquidity ultimately benefits investors. It is not
possible for market participants to predict what market conditions will
exist at a specific time, and when volatility will occur. The proposed
rule change to permit routine, recurring RWA Transfers (and to not
provide prior written notice) will provide market participants with the
ability to respond to these conditions whenever they occur. Permitting
transfers on a routine, recurring basis will provide market
participants with the flexibility to comply with these restrictions
when necessary to avoid position limits on future options activity. In
addition, with respect to netting, as discussed above, firms may
maintain different clearing accounts for a variety of reasons, such as
the structure of their businesses, the manner in which they trade,
their risk management procedures, and for capital purposes. Netting may
otherwise occur with respect to a firm's positions if it structured its
clearing accounts differently, such as by using a universal account.
Therefore, the proposed rule change will permit netting while allowing
firms to continue to maintain different clearing accounts in a manner
consistent with their businesses.
    The Exchange recognizes the numerous benefits of executing options
transactions occur on an exchanges, including price transparency,
potential price improvement, and a clearing guarantee. However, the
Exchange believes it is appropriate to permit RWA Transfers to occur
off the exchange, as these benefits are inapplicable to RWA Transfers.
RWA Transfers have a narrow scope and are intended to achieve a
limited, benefit purpose. RWA Transfers are not intended to be a
competitive trading tool. There is no need for price discovery or
improvement, as the purpose of the transfer is to reduce RWA asset
capital requirements attributable to a market participants' positions.
Unlike trades on an exchange, the price at which an RWA Transfers
occurs is immaterial--the resulting reduction in RWA is the critical
part of the transfer. RWA Transfers will result in no change in
ownership, and thus they do not constitute trades with a counterparty
(and thus eliminating the need for a counterparty guarantee). The
transactions that resulted in the open positions to be transferred as
an RWA Transfer were already guaranteed by an OCC clearing member, and
the positions will continue to be subject to OCC rules, as they will
continue to be held in an account with an OCC clearing member. The
narrow scope of the proposed rule change and the limited, beneficial
purpose of RWA Transfers make allowing RWA Transfers to occur off the
floor appropriate and important to support the provision of liquidity
in the listed options market.
    The proposed rule change does not unfairly discriminate against
market participants, as all Participants and non-Participants with open
positions in options listed on the Exchange may use the proposed off-
exchange transfer process to reduce the RWA capital requirements of
Clearing Participants.

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

    The Exchange 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.
    The Exchange 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. This process is not intended
to be a competitive trading tool. The Exchange does not believe that
the proposed rule change will impose any burden on intra-market
competition that is not necessary or appropriate in furtherance of the
purposes of the Act, as use of the proposed process is voluntary. All
Participants and non-Participants with open positions in options listed
on the Exchange may use the proposed off-exchange transfer process to
reduce the RWA capital requirements attributable to those positions.
The Exchange does not believe that the proposed rule change will impose
any burden on intermarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act. RWA Transfers
have a limited purpose, which is to reduce RWA attributable to open
positions in listed options in order to free up capital. The Exchange
believes the proposed rule change may relieve the burden on liquidity
providers in the options market by reducing the RWA attributable to
their open positions. As a result, market participants may be able to
increase liquidity they provide to the market, which liquidity benefits
all market participants.

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

    No written comments were either solicited or received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \23\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\24\
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    \23\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \24\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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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. If the

Commission takes such action, the Commission shall institute
proceedings to determine whether the proposed rule should be approved
or disapproved.

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-NASDAQ-2019-097 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASDAQ-2019-097. 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 website (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 website 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 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. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NASDAQ-2019-097 and should be submitted
on or before January 21, 2020.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\25\
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    \25\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2019-28028 Filed 12-27-19; 8:45 am]
BILLING CODE P


[Federal Register: March 24, 2010 (Volume 75, Number 56)]
[Notices]
[Page 14225-14227]
[DOCID:fr24mr10-133]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61737; File No. SR-ISE-2010-22]

Self-Regulatory Organizations; International Securities Exchange,
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule
Change To Permit Concurrent Listing of $3.50 and $4 Strikes for Classes
in the $0.50 Strike and $1 Strike Programs

March 18, 2010.
    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 March 10, 2010, the International Securities Exchange, LLC (the
``Exchange'' or the ``ISE'') 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 Exchange has filed the proposal as a ``non-
controversial'' proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(6) thereunder.\4\ 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.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).

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

    The Exchange proposes to permit the concurrent listing of $3.50 and
$4 strikes for classes that participate in both the $0.50 Strike and $1
Strike Programs. 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 those 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 parts of such statements.

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

1. Purpose
    The purpose of this proposed rule change is to permit the
concurrent listing of $3.50 and $4 strikes for classes that participate
in both the $0.50 Strike and $1 Strike Programs.
    The Exchange recently implemented a rule change that permits strike
price intervals of $0.50 for options on stocks trading at or below
$3.00 (``$0.50 Strike Program'').\5\ As part of the filing to establish
the $0.50 Strike Program, the Exchange contemplated that a class may be
selected to participate in both the $0.50 Strike Program and the $1
Strike Program. Under the $1 Strike Program, new series with $1
intervals are not permitted to be listed within $0.50 of an existing
$2.50 strike price in the same series, except that strike prices of $2
and $3 are permitted to be listed within $0.50 of a $2.50 strike price
for classes also selected to participate in the $0.50 Strike
Program.\6\ Under ISE's existing rule, for classes selected to
participate in both the $0.50 Strike Program and the $1 Strike Program,
the Exchange may either: (a) List a $3.50 strike but not list a $4
strike; or (b) list a $4 strike but not list a $3.50 strike. For
example, if a $3.50 strike for an options class in both the $0.50 and
$1 Strike Programs was listed, the next highest permissible strike
price would be $5.00. Alternatively, if a $4 strike was listed, the
next lowest permissible strike price would be $3.00. The intent of the
$.50 Strike Program was to expand the ability of investors to hedge
risks associated with stocks trading at or under $3 and to provide
finer intervals of $0.50, beginning at $1 up to $3.50. As a result, the
Exchange believes that the current filing is consistent with the
purpose of the $0.50 Strike Program and will permit the Exchange to
fill in any existing gaps resulting from having to choose whether to
list a $3.50 or $4 strike for options classes in both the $0.50 and $1
Strike Programs.
---------------------------------------------------------------------------

    \5\ See Exchange Act Release No. 60696 (September 18, 2009), 74
FR 49053 (September 24, 2009) (SR-ISE-2009-65).
    \6\ See Supplementary Material .01(b) to ISE Rule 504.
---------------------------------------------------------------------------

    Therefore, the Exchange is submitting the current filing to permit
the listing of concurrent $3.50 and $4 strikes for classes that are
selected to participate in both the $0.50 Strike Program and the $1
Strike Program. To effect this change, the Exchange is proposing to
amend Supplementary Material .01(b) to ISE Rule 504 by adding $4 to the
strike prices of $2 and $3 currently permitted if a class participates
in both the $0.50 Strike Program and the $1 Strike Program.
    The Exchange is also proposing to amend the current rule text to
delete references to ``$2.50 strike prices'' (and the example utilizing
$2.50 strike prices) and to replace those references with broader
language, e.g., ``existing strike prices.''
2. Statutory Basis
    The basis under the Securities Exchange Act of 1934 (``Exchange
Act'') for this proposed rule change is the requirement under section
6(b)(5) of the Exchange Act \7\ that an exchange have rules that are
designed to promote just and equitable principles of trade, and to
remove impediments to and perfect the mechanism for a free and open
market and a national market system, and in general, to protect
investors and the public interest. In particular, the proposed rule
change will allow the Exchange to list more granular strikes on options
overlying lower priced securities, which the Exchange believes will
provide investors with greater flexibility by allowing them to
establish positions that ate better tailored to meet their investment
objectives.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    Because the foregoing proposed rule change does not significantly
affect the protection of investors or the public interest, does not
impose any significant burden on competition, and, by its terms, does
not become operative for 30 days from the date on which it was filed,
or such shorter time as the Commission may designate, it has become
effective pursuant to section 19(b)(3)(A) \8\ of the Act and Rule 19b-
4(f)(6) \9\ thereunder. The Exchange provided the Commission with
written notice of its intent to file the proposed rule change, along
with a brief description and text of the proposed rule change, at least
five business days prior to the date of filing the proposed rule
change.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 C.F.R. 240.19b-4(f)(6).
---------------------------------------------------------------------------

    The Exchange has requested that the Commission waive the 30-day
operative delay to permit the Exchange to compete with other exchanges
whose rules permit concurrent listing of $3.50 and $4 strikes for
classes similarly participating in both a $0.50 strike program and a $1
strike program. The Commission finds that waiver of the operative delay
is consistent with the protection of investors and the public interest
because such waiver will encourage fair competition among the
exchanges. Therefore, the Commission designates the proposal operative
upon filing.\10\
---------------------------------------------------------------------------

    \10\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate 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_ADDRESS>Please include
File Number SR-ISE-2010-22 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-2010-22. 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 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-2010-22 and should be
submitted on or before April 14, 2010.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-6517 Filed 3-23-10; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register: July 1, 2009 (Volume 74, Number 125)]
[Notices]
[Page 31428-31430]
[DOCID:fr01jy09-51]

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ENVIRONMENTAL PROTECTION AGENCY

[EPA-HQ-OPP-2009-0321; FRL-8417-2]

Sodium Dimethyldithiocarbamate; Notice of Receipt of Requests for
Amendments to Delete Uses in a Pesticide Registration

AGENCY: Environmental Protection Agency (EPA).

ACTION: Notice.

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

SUMMARY: In accordance with section 6(f)(1) of the Federal Insecticide,
Fungicide, and Rodenticide Act (FIFRA), as amended, EPA is issuing a
notice of receipt of request for amendments by registrants to delete
uses in a pesticide registration. Section 6(f)(1) of FIFRA provides
that a registrant of a pesticide product may at any time request that
any of its pesticide registrations be amended to delete one or more
uses. FIFRA further provides that, before acting on the request, EPA
must publish a notice of receipt of any request in the Federal
Register.

DATES: The deletions are effective July 31, 2009, unless the Agency
receives a written withdrawal request on or before July 31, 2009. The
Agency will consider a withdrawal request postmarked no later than July
31, 2009.
    Users of this product who desire continued use on crops or sites
being deleted should contact the applicable registrant on or before
July 31, 2009.

ADDRESSES: Submit your withdrawal request, identified by docket
identification (ID) number EPA-HQ-OPP-2009-0321, by one of the
following methods:
     Mail: Office of Pesticide Programs (OPP) Regulatory Public
Docket (7502P), Environmental Protection Agency, 1200 Pennsylvania
Ave., NW., Washington, DC 20460-0001.
     Delivery: OPP Regulatory Public Docket (7502P),
Environmental Protection Agency, Rm. S-4400, One Potomac Yard (South
Bldg.), 2777 S. Crystal Dr., Arlington, VA. Deliveries are only
accepted during the Docket Facility's normal hours of operation (8:30
a.m. to 4 p.m., Monday through Friday, excluding legal holidays).
Special arrangements should be made for deliveries of boxed
information. The Docket Facility telephone number is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Eliza Blair, Antimicrobials (7510P)
Division, Office of Pesticide Programs, Environmental Protection
Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460-0001;
telephone number:<PHONE_NUMBER>; e-mail address<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. General Information

A. Does this Action Apply to Me?

    This action is directed to the public in general. Although, this
action may be of particular interest to persons who produce or use
pesticides, the Agency has not attempted to describe all the specific
entities that may be affected by this action. If you have any questions
regarding the information in this notice, consult the person listed
under FOR FURTHER INFORMATION CONTACT.

B. How Can I Get Copies of this Document and Other Related Information?

    1. Docket. EPA has established a docket for this action under
docket ID number EPA-HQ-OPP-2009-0321. Publicly available docket
materials are available either in the electronic docket at http://
www.regulations.gov, or, if only available in hard copy, at the Office
of Pesticide Programs (OPP) Regulatory Public Docket in Rm. S-4400, One
Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington, VA. The
hours of operation of this Docket Facility are from 8:30 a.m. to 4
p.m., Monday through Friday, excluding legal holidays. The Docket
Facility telephone number is<PHONE_NUMBER>.
    2. Electronic access. You may access this Federal Register document
electronically through the EPA Internet under the ``Federal Register''
listings at http://www.epa.gov/fedrgstr.

II. What Action is the Agency Taking?

    This notice announces receipt by the Agency of applications from
registrants to delete uses in a pesticide registration. This
registration is listed in Table 1 of this unit by registration number,
product name, active ingredient, and specific uses deleted:

                  Table 1.--Requests for Amendments to Delete Uses in a Pesticide Registration
----------------------------------------------------------------------------------------------------------------
         EPA Registration No.                Product Name          Active Ingredient        Delete from Label
----------------------------------------------------------------------------------------------------------------
1965-8                                 Vancide 51               Sodium                   Preservation of Cotton
                                                                 Dimethyldithiocarbamat   Fabric; Preservation
                                                                 e                        of Wood Veneer;
                                                                                Preservation of
                                                                                Alginate Pastes
----------------------------------------------------------------------------------------------------------------

     The sodium dimethyldithiocarbamate registrant has requested that
the Agency waive the 180-day comment period. The Agency will provide a
30-day comment period on the proposed requests.
    Users of this product who desire continued use on crops or sites
being deleted should contact the applicable registrant before July 31,
2009 to discuss withdrawal of the application for amendment. This 30-
day period will also permit interested members of the public to
intercede with registrants prior to the Agency's approval of the
deletion.
    Table 2 of this unit includes the name and address of record for
the registrant of the product listed in Table 1 of this unit, in
sequence by EPA company number.

    Table 2.--Registrant Requesting an Amendment to Delete Uses in a
                         Pesticide Registration
------------------------------------------------------------------------
            EPA Company Number                Company Name and Address
------------------------------------------------------------------------
1965                                        R.T. Vanderbilt Co. Inc.
                                            30 Winfield St
                                            Norwalk, CT 06856-5150
------------------------------------------------------------------------

III. What is the Agency's Authority for Taking this Action?

    Section 6(f)(1) of FIFRA provides that a registrant of a pesticide
product may at any time request that any of its pesticide registrations
be amended to delete one or more uses. The FIFRA further provides that,
before acting on the request, EPA must publish a notice of receipt of
any such request in the Federal Register. Thereafter, the Administrator
may approve such a request.

IV. Procedures for Withdrawal of Request

    Registrants who choose to withdraw a request for use deletion must
submit the withdrawal in writing to Eliza Blair using the methods in
ADDRESSES. The Agency will consider written withdrawal requests
postmarked no later than July 31, 2009.

V. Provisions for Disposition of Existing Stocks

    The Agency has authorized the registrants to sell or distribute
product under the previously approved labeling for a period of 18
months after approval of the revision, unless other restrictions have
been imposed, as in special review actions.

List of Subjects

    Environmental protection, Antimicrobials, Pesticides and pests,
Dimethyldithiocarbamate salts, Sodium dimethyldithiocarbamate.

    Dated: June 11, 2009.
 Joan Harrigan Farrelley,
Director, Antimicrobials Division, Office of Pesticide Programs.
[FR Doc. E9-14997 Filed 6-30-09; 8:45 a.m.]

BILLING CODE 6560-50-S