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Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to PrecISE Fees

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Start Preamble June 26, 2007.

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 June 1, 2007, 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 substantially prepared by the Exchange. ISE has designated this proposal as one establishing or changing a due, fee, or other charge imposed by ISE under section 19(b)(3)(A)(ii) of the Act [3] and Rule 19b-4(f)(2) thereunder,[4] which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

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

The ISE is proposing to amend the fees for its PrecISE Trade® order entry terminals and also to delete obsolete references to CLICK fees in its Schedule of Fees. The text of the proposed rule change is available at the Exchange, the Commission's Public Reference Room, and

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. Start Printed Page 36532

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 amend the ISE's Schedule of Fees concerning fees for its proprietary PrecISE Trade® order entry terminals. “PrecISE” is the Exchange's internally-developed proprietary order-routing terminal used by Electronic Access Members (“EAMs”) to send order flow to ISE. The Exchange currently charges a monthly fee of $250 per terminal, with a $500 minimum and $1,500 maximum per EAM.[5] ISE recently updated PrecISE, enhancing it with certain new functionalities that permit, among other things, away market routing for non-ISE listed options. Certain other user-requested enhancements have also been built into the new version, including the facilitation of complex orders. In order for ISE to cover the costs of building out the enhanced version, the Exchange proposes to amend the current PrecISE fees as follows: for the first 10 users, the Exchange proposes a fee of $300 per user per month; for all subsequent users, the Exchange proposes to charge $50 per user per month.

Additionally, ISE recently decommissioned all the CLICK terminals that were at member sites. All EAMs now have PrecISE Trade terminals. In the PrecISE Fee Filing, the Exchange noted that upon completion of the phase-out of CLICK, ISE will submit a proposed rule change to the Commission pursuant to which it will remove CLICK fees from its Schedule of Fees. The Exchange thus proposes to remove all references to CLICK terminals from its Schedule of Fees.[6]

2. Basis

The basis under the Act for this proposed rule change is the requirement under section 6(b)(4) [7] that an exchange have an equitable allocation of reasonable dues, fees and other charges among its members and other persons using its facilities. In particular, these fees will enable the Exchange to cover its costs for providing an enhanced version of its front-end trading system.

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 proposed rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act [8] and Rule 19b-4(f)(2) [9] thereunder because it establishes or changes a due, fee, or other charge imposed by the Exchange. At any time within 60 days of the filing of such 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

Paper Comments

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

All submissions should refer to File Number SR-ISE-2007-42. 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 (​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 inspection and copying in the Commission's Public Reference Room on official business days between the hours of 10 a.m. and 3 p.m. Copies of such filing also will be available for inspection and copying at the principal office of the ISE. 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-2007-42 and should be submitted on or before July 24, 2007.

Start Signature

For the Commission, by the Division of Market Regulation, pursuant to delegated authority.[10]

Florence E. Harmon,

Deputy Secretary.

End Signature End Preamble


3.  15 U.S.C. 78s(b)(3)(A)(ii).

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5.  See Securities Exchange Act Release No. 53788 (May 11, 2006), 71 FR 28728 (May 17, 2006) (ISE-2006-19) (the “PrecISE Fee Filing”).

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6.  Regarding the Session/API fee, the Exchange's proposal to delete the reference to CLICK (referred to as the “Options Trade Review Terminal”) in that item of the Schedule of Fees leaves untouched the existing flat $250 Session/API fee, which continues to be applicable to EAMs that use their own API to connect to the Exchange (i.e., EAMs that do not use PrecISE to access the Exchange). See Telephone conference between Samir Patel, Assistant General Counsel, ISE, and Richard Holley III, Special Counsel, Division of Market Regulation, Commission, dated June 22, 2007.

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8.  15 U.S.C. 78s(b)(3)(A)(ii).

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[FR Doc. E7-12778 Filed 7-2-07; 8:45 am]