Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fees Schedule

Federal Register, Volume 77 Issue 116 (Friday, June 15, 2012)

Federal Register Volume 77, Number 116 (Friday, June 15, 2012)

Notices

Pages 36024-36025

From the Federal Register Online via the Government Printing Office www.gpo.gov

FR Doc No: 2012-14620

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SECURITIES AND EXCHANGE COMMISSION

Release No. 34-67175; File No. SR-C2-2012-016

Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fees Schedule

June 11, 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 May 29, 2012, C2 Options Exchange, Incorporated (the ``Exchange'' or ``C2'') 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 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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1. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change

   The Exchange proposes to amend its Fees Schedule. The text of the proposed rule change is available on the Exchange's Web site (http://www.c2exchange.com/Legal/), at the Exchange's Office of the Secretary, and at the Commission's Public Reference Room.

2. 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.

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

      1. Purpose

         The Exchange proposes to amend its Fees Schedule in order to state that, in regards to complex orders in multiply-listed, equity and ETF options classes, the rebate that would otherwise apply to Public Customer orders will not apply when a Public Customer order is trading with another Public Customer order. In such a circumstance, there will be no Maker or Taker fee or rebate. The reason for this change is to ensure that the Exchange pays rebates only on transactions in which the Exchange also collects some revenue.

         The proposed change is to take effect on June 1, 2012.

      2. Statutory Basis

         The Exchange believes the proposed rule change is consistent with the Act and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.\3\ Specifically, the Exchange believes the proposed rule change is consistent with Section 6(b)(4) of the Act,\4\ which provides that Exchange rules may provide for the equitable allocation of reasonable dues, fees, and other charges among its Trading Permit Holders and other persons using its facilities. The proposed change is reasonable because, while Public Customers trading complex orders in multiply-

         listed, equity and ETF classes with other Public Customers will no longer be receiving a rebate, they will still not be paying a fee for such transactions. The proposed change is equitable and not

         Page 36025

         unfairly discriminatory because, as previously stated, Public Customers in this situation will still not be paying a fee, and because the Exchange must maintain its administrative and regulatory duties, the maintenance of a system in which the Exchange pays rebates to both sides of a transaction without collecting fees for such transactions may not be prudent. Further, other exchanges that offer customer rebates for complex order executions exclude customer-to-customer transactions.\5\

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         \3\ 15 U.S.C. 78f(b).

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

         \5\ See International Securities Exchange, LLC Schedule of Fees, page 20, footnote 11.

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

      C2 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.

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

      The Exchange neither solicited nor received comments on the proposed rule change.

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

   The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) \6\ of the Act and paragraph (f) of Rule 19b-4 \7\ thereunder. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.

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   \6\ 15 U.S.C. 78s(b)(3)(A).

   \7\ 17 CFR 240.19b-4(f).

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4. 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 rule-comments@sec.gov. Please include File Number SR-C2-2012-016 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-C2-2012-016. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro/shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such filing will also 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 No. SR-C2-2012-016 and should be submitted on or before July 6, 2012.

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

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

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   Kevin M. O'Neill,

   Deputy Secretary.

   FR Doc. 2012-14620 Filed 6-14-12; 8:45 am

   BILLING CODE 8011-01-P