From: Bastiaan van Kempen [BastiaanK@Optiver.com] Sent: Tuesday, September 16, 2003 5:53 PM To: 'rule-comments@sec.gov' Subject: BOX Rule Filing with SEC and Public Comment Period Jonathan G. Katz Secretary Securities and Exchange Commission 450 Fifth Street, N.W. Washington, D.C. 20549-0609 September 12, 2003 Re: "BOX - SR-BSE-2002-15" Dear Mr. Katz: Optiver US, LLC ("Optiver") is writing to express support for the BOX. Optiver is a registered broker-dealer and a CMM on the ISE. Affiliates of Optiver are market makers on a number of derivatives exchanges around the world, including Amsterdam, London, Frankfurt, Sydney and Hong Kong. It is Optiver's strong belief that transparent, open, cost-efficient and competitive markets are in the best interest of customers, liquidity providers and order-flow providers alike. The rules proposed by the BOX support these market characteristics. The BOX has very low entry barriers and a favorable fixed and variable cost structure for market makers. This will lead to increased competition and to smaller bid-ask spreads. The introduction of full time priority rules (with the exception of the PIP) create a strong incentive for market makers to improve bid-ask spreads whenever possible. Optiver's experience after the implementation of electronic markets in Europe has shown that the principle of time-priority combined with anonymity creates narrower bid-ask spreads. Also, we expect enhanced competition between liquidity providers on price, speed and technology, because no market participant will be in the structurally privileged position of specialist/DPM. All factors discussed above will decrease the implicit costs of trading for customers. Optiver is opposed to any internalization rules. We believe that price-discovery is best served when order flow is simultaneously exposed to all market participants and no participant has an advantageous position. However, given the existing practices and exchange rules on internalization, we believe that the PIP process is a relatively fair mechanism. Internalized orders will be executed at better prices than the NBBO and the one cent increments will regularly offer realistic possibilities for liquidity providers to improve the price. Based upon the aforementioned, Optiver supports the BOX. We believe the BOX's rules will stimulate competition between liquidity providers and therefore lead to better prices. This will lead to more efficient derivative markets in the U.S. Respectfully submitted, Bastiaan van Kempen Director Optiver US, LLC 440 S. LaSalle Street, Suite 1121 Chicago, IL60605 ********************************************************************** This email and any files transmitted with it are confidential and intended solely for the use of the individual or entity to whom they are addressed. If you have received this email in error please notify the system manager. This footnote also confirms that this email message has been swept by MIMEsweeper for the presence of computer viruses. www.mimesweeper.com ********************************************