80_FR_11759 80 FR 11717 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Granting Accelerated Approval of a Proposed Rule Change To Amend Exchange Rules Related To Order Tickets

80 FR 11717 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Granting Accelerated Approval of a Proposed Rule Change To Amend Exchange Rules Related To Order Tickets

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 42 (March 4, 2015)

Page Range11717-11718
FR Document2015-04451

Federal Register, Volume 80 Issue 42 (Wednesday, March 4, 2015) 
[Federal Register Volume 80, Number 42 (Wednesday, March 4, 2015)]
[Notices]
[Pages 11717-11718]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-04451]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74389; File No. SR-CBOE-2015-011]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Order Granting Accelerated Approval of a Proposed Rule 
Change To Amend Exchange Rules Related To Order Tickets

February 26, 2015.

I. Introduction

    On January 23, 2015, the Chicago Board Options Exchange, 
Incorporated (the ``Exchange'' or ``CBOE'') filed with the Securities 
and Exchange Commission (the ``Commission''), pursuant to Section 
19(b)(1) of the Securities Exchange Act of 1934 (the ``Act'')\1\ and 
Rule 19b-4 thereunder,\2\ a proposed rule change to amend its rules 
related to use of order tickets. This proposal was published for 
comment in the Federal Register on February 4, 2015.\3\ The Commission 
received no comments regarding the proposal. This order approves the 
proposed rule change on an accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 74169 (January 29, 
2015), 80 FR 6145 (``Notice'').
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II. Description of the Proposed Rule Change

    The Exchange proposes to amend its rules governing the use of order 
tickets. According to the Exchange, system limitations on CBOE 
currently may prevent a multi-part order with more than a certain 
number of legs from being entered on a single order ticket for 
representation and execution in open outcry as a complex order.\4\ As a 
result, complex orders with more than the applicable leg limitation 
that are represented in open outcry must be split up and entered on 
multiple order tickets.\5\
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    \4\ See Notice, supra note 3 at 6147.
    \5\ Id.
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    The Exchange proposes to amend CBOE Rule 6.53 to require that 
complex orders of twelve (12) legs or less (one leg of which may be for 
an underlying security or security future, as applicable) must be 
entered on a single order ticket at time of systemization to provide 
consistency in processing, and to enhance the Exchange's audit 
trail.\6\ If permitted by the Exchange via Regulatory Circular, complex 
orders of more than twelve (12) legs (one leg of which may be for an 
underlying security or security future, as applicable) may be split 
across multiple order tickets, if the Trading Permit Holder (``TPH'') 
representing the complex order includes twelve (12) legs on one of the 
order tickets and identifies for the Exchange the order tickets that 
are part of the same complex order (in a form and manner prescribed by 
the Exchange).\7\
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    \6\ Id.
    \7\ Id.
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    The Exchange also proposes to add Interpretation and Policy .01 to 
CBOE Rule 24.20 (pertaining to SPX Combo Orders) to require that an SPX 
Combo Order for twelve (12) legs or less be entered on a single order 
ticket at time of systemization.\8\ An SPX Combo Order that contains 
more than twelve (12) legs may be represented and executed as a single 
SPX Combo Order in accordance with CBOE Rule 24.20 if it is split 
across multiple order tickets and the TPH representing the SPX Combo 
Order includes twelve (12) legs on one of the order tickets and 
identifies for the Exchange the order tickets that are part of the same 
SPX Combo Order (in a manner and form prescribed by the Exchange).\9\ 
The Exchange will announce by Regulatory Circular whether it will 
permit SPX Combo Orders with more than 12 legs and, if so permitted, 
the form and manner in which the TPH must link the multiple order 
tickets.\10\ The Exchanges notes that a TPH may submit an order that 
does not satisfy these ticket requirements, but such order may not be 
represented or executed as a single SPX Combo Order in accordance with 
Rule 24.20.\11\ The Exchange also notes that Rules 24.20 already 
specifies an applicable ratio, and it is proposing no changes to the 
ratio through this rule filing.\12\
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    \8\ Id.
    \9\ If an Open outcry complex order or SPX Combo Order with more 
than twelve legs is split across multiple order tickets, one of the 
order tickets must contain twelve legs. For example, a thirteen leg 
order cannot have seven legs on one ticket and six legs on another 
ticket; rather, one ticket must have twelve legs and the other 
ticket must have one leg. Id. at 6147.
    \10\ Id.
    \11\ Id.
    \12\ Id.
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III. Discussion and Findings

    After careful review, the Commission finds that the proposed rule 
change is consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to a national securities 
exchange.\13\ In particular, the Commission finds that the proposed 
rule change is consistent with Section 6(b)(5) of the Act,\14\ which 
requires, among other things, that the rules of a national securities 
exchange be designed to prevent fraudulent and manipulative acts and 
practices, 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. The Commission also finds that the proposed rule 
change is consistent with Section 6(b)(1) of the Act,\15\ which 
provides that the Exchange be organized and have the capacity to be 
able to carry out the purposes of the Act and to enforce compliance by 
the Exchange's members, and persons associated with members, with the 
Act, the rules and regulations thereunder and the rules of the 
Exchange.
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    \13\ In approving this proposal, the Commission has considered 
the proposed rule's impact on efficiency, competition, and capital 
formation. See 15 U.S.C. 78c(f).
    \14\ 15 U.S.C. 78f(b)(5).
    \15\ 15 U.S.C. 78f(b)(1).
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    The Commission notes that CBOE's proposal is designed to help 
enhance the Exchange's audit trail with respect to open outcry complex 
order processing and SPX Combo Orders. The Commission believes that the 
proposal will help to protect investors and the public interest because 
the Commission believes an audit trail serves to provides regulators 
with information that aids them in surveiling activity on their market.
    In addition, the Commission finds good cause, pursuant to Section 
19(b)(2) of the Act,\16\ for approving the proposed rule change prior 
to the 45th day after publication of notice in the Federal Register. 
The Commission notes that the substance of this proposal was noticed 
for comment as part of changes proposed in a prior CBOE proposed rule 
change, which CBOE withdrew.\17\ The

[[Page 11718]]

prior CBOE proposed rule change was published for the entire 21 day 
comment period, and no comments were received.\18\ In addition, the 
instant proposed rule change was published for a 15-day comment period 
to ensure that the public had an opportunity to review the proposal in 
its current form and no comments were received on the instant filing. 
Finally, the Commission notes that the Exchange represents that it has 
been in communication with TPHs about the changes proposed in the 
instant filing and implementation issues since August 19, 2014, and has 
provided training on a Floor Broker Workstation (``FBW) to support the 
combo indicator and the entry of complex orders with up to twelve 
legs.\19\
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    \16\ 15 U.S.C. 78s(b)(2).
    \17\ See Securities Exchange Act Release No. 72957 (September 2, 
2014), 79 FR 53230 (September 8, 2014) (``SR-CBOE-2014-015 
Notice''). CBOE withdrew SR-CBOE-2014-015 on November 21, 2014. The 
Exchange notes that, unlike the instant filing, SR-CBOE-2014-015 did 
not impose requirements on how a complex order with more than 12 
legs should be split across multiple tickets. While the instant 
filing imposes such a requirement, the Exchange does not believe 
TPHs will be adversely affected by the proposed requirement 
specifying how a complex order with more than 12 legs should be 
split across multiple tickets. The Exchange states that PULSe, the 
enhanced version of FBW, and proprietary systems that TPHs have 
designed to comply with the single order ticket requirements of SR-
CBOE-2014-015 are capable of complying with the requirement 
specifying how orders with more than 12 legs should be split across 
multiple tickets without further programming or configuration. Id. 
at 6147.
    \18\ SR-CBOE-2014-015 provided for several changes to various 
CBOE Rules; this proposal specifically relates to Order Ticket 
requirements. See SR-CBOE-2014-015 Notice, supra note 17.
    \19\ See Notice, supra note 3 at 6146.
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    Accordingly, the Commission finds that good cause exists for 
approving the proposed rule change on an accelerated basis.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\20\ that the proposed rule change (File No. SR-CBOE-2015-011) be, 
and hereby is, approved on an accelerated basis.
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    \20\ 15 U.S.C. 78s(b)(2).
    \21\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\21\
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2015-04451 Filed 3-3-15; 8:45 am]
BILLING CODE 8011-01-P

Federal Register / Vol. 80, No. 42 / Wednesday, March 4, 2015 / Notices 11717 For the Commission, by the Division of applicable) must be entered on a single consistent with the requirements of the Trading and Markets, pursuant to delegated order ticket at time of systemization to Act and the rules and regulations authority.12 provide consistency in processing, and thereunder applicable to a national Jill M. Peterson, to enhance the Exchange’s audit trail.6 securities exchange.13 In particular, the Assistant Secretary. If permitted by the Exchange via Commission finds that the proposed [FR Doc. 2015–04421 Filed 3–3–15; 8:45 am] Regulatory Circular, complex orders of rule change is consistent with Section BILLING CODE 8011–01–P more than twelve (12) legs (one leg of 6(b)(5) of the Act,14 which requires, which may be for an underlying security among other things, that the rules of a or security future, as applicable) may be national securities exchange be SECURITIES AND EXCHANGE split across multiple order tickets, if the designed to prevent fraudulent and COMMISSION Trading Permit Holder (‘‘TPH’’) manipulative acts and practices, to [Release No. 34–74389; File No. SR–CBOE– representing the complex order includes promote just and equitable principles of 2015–011] twelve (12) legs on one of the order trade, to remove impediments to and tickets and identifies for the Exchange perfect the mechanism of a free and Self-Regulatory Organizations; the order tickets that are part of the open market and a national market Chicago Board Options Exchange, same complex order (in a form and system, and, in general, to protect Incorporated; Order Granting manner prescribed by the Exchange).7 investors and the public interest. The Accelerated Approval of a Proposed The Exchange also proposes to add Commission also finds that the Rule Change To Amend Exchange Interpretation and Policy .01 to CBOE proposed rule change is consistent with Rules Related To Order Tickets Rule 24.20 (pertaining to SPX Combo Section 6(b)(1) of the Act,15 which Orders) to require that an SPX Combo provides that the Exchange be organized February 26, 2015. Order for twelve (12) legs or less be and have the capacity to be able to carry I. Introduction entered on a single order ticket at time out the purposes of the Act and to of systemization.8 An SPX Combo Order enforce compliance by the Exchange’s On January 23, 2015, the Chicago that contains more than twelve (12) legs members, and persons associated with Board Options Exchange, Incorporated may be represented and executed as a (the ‘‘Exchange’’ or ‘‘CBOE’’) filed with members, with the Act, the rules and single SPX Combo Order in accordance regulations thereunder and the rules of the Securities and Exchange with CBOE Rule 24.20 if it is split across Commission (the ‘‘Commission’’), the Exchange. multiple order tickets and the TPH The Commission notes that CBOE’s pursuant to Section 19(b)(1) of the representing the SPX Combo Order Securities Exchange Act of 1934 (the proposal is designed to help enhance includes twelve (12) legs on one of the the Exchange’s audit trail with respect ‘‘Act’’)1 and Rule 19b–4 thereunder,2 a order tickets and identifies for the proposed rule change to amend its rules to open outcry complex order Exchange the order tickets that are part processing and SPX Combo Orders. The related to use of order tickets. This of the same SPX Combo Order (in a proposal was published for comment in Commission believes that the proposal manner and form prescribed by the will help to protect investors and the the Federal Register on February 4, Exchange).9 The Exchange will 2015.3 The Commission received no public interest because the Commission announce by Regulatory Circular believes an audit trail serves to provides comments regarding the proposal. This whether it will permit SPX Combo order approves the proposed rule regulators with information that aids Orders with more than 12 legs and, if so them in surveiling activity on their change on an accelerated basis. permitted, the form and manner in market. II. Description of the Proposed Rule which the TPH must link the multiple In addition, the Commission finds Change order tickets.10 The Exchanges notes good cause, pursuant to Section 19(b)(2) that a TPH may submit an order that of the Act,16 for approving the proposed The Exchange proposes to amend its does not satisfy these ticket rule change prior to the 45th day after rules governing the use of order tickets. requirements, but such order may not be publication of notice in the Federal According to the Exchange, system represented or executed as a single SPX Register. The Commission notes that the limitations on CBOE currently may Combo Order in accordance with Rule prevent a multi-part order with more substance of this proposal was noticed 24.20.11 The Exchange also notes that for comment as part of changes than a certain number of legs from being Rules 24.20 already specifies an entered on a single order ticket for proposed in a prior CBOE proposed rule applicable ratio, and it is proposing no change, which CBOE withdrew.17 The representation and execution in open changes to the ratio through this rule outcry as a complex order.4 As a result, filing.12 13 In approving this proposal, the Commission has complex orders with more than the III. Discussion and Findings considered the proposed rule’s impact on applicable leg limitation that are efficiency, competition, and capital formation. See represented in open outcry must be split After careful review, the Commission 15 U.S.C. 78c(f). up and entered on multiple order finds that the proposed rule change is 14 15 U.S.C. 78f(b)(5). tickets.5 15 15 U.S.C. 78f(b)(1). The Exchange proposes to amend 6 Id. 16 15 U.S.C. 78s(b)(2). 17 See Securities Exchange Act Release No. 72957 CBOE Rule 6.53 to require that complex 7 Id. (September 2, 2014), 79 FR 53230 (September 8, orders of twelve (12) legs or less (one leg 8 Id. 2014) (‘‘SR–CBOE–2014–015 Notice’’). CBOE of which may be for an underlying 9 If an Open outcry complex order or SPX Combo withdrew SR–CBOE–2014–015 on November 21, security or security future, as Order with more than twelve legs is split across 2014. The Exchange notes that, unlike the instant mstockstill on DSK4VPTVN1PROD with NOTICES multiple order tickets, one of the order tickets must filing, SR–CBOE–2014–015 did not impose contain twelve legs. For example, a thirteen leg requirements on how a complex order with more 12 17 CFR 200.30–3(a)(12). order cannot have seven legs on one ticket and six than 12 legs should be split across multiple tickets. 1 15 U.S.C. 78s(b)(1). legs on another ticket; rather, one ticket must have While the instant filing imposes such a 2 17 CFR 240.19b–4. twelve legs and the other ticket must have one leg. requirement, the Exchange does not believe TPHs 3 See Securities Exchange Act Release No. 74169 Id. at 6147. will be adversely affected by the proposed (January 29, 2015), 80 FR 6145 (‘‘Notice’’). 10 Id. requirement specifying how a complex order with 4 See Notice, supra note 3 at 6147. 11 Id. more than 12 legs should be split across multiple 5 Id. 12 Id. Continued VerDate Sep<11>2014 18:11 Mar 03, 2015 Jkt 235001 PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 E:\FR\FM\04MRN1.SGM 04MRN1

11718 Federal Register / Vol. 80, No. 42 / Wednesday, March 4, 2015 / Notices prior CBOE proposed rule change was proposed rule change (File No. SR– operating status, if any. Each of the published for the entire 21 day CBOE–2015–011) be, and hereby is, issuers below is quoted on OTC Link comment period, and no comments approved on an accelerated basis. operated by OTC Markets Group, Inc. were received.18 In addition, the instant For the Commission, by the Division of OTC Markets Group, Inc., however, has proposed rule change was published for Trading and Markets, pursuant to delegated been unable to contact each of these a 15-day comment period to ensure that authority.21 issuers for more than one year. In the public had an opportunity to review Jill M. Peterson, addition, the staff of the Securities and the proposal in its current form and no Assistant Secretary. Exchange Commission has comments were received on the instant independently endeavored to determine [FR Doc. 2015–04451 Filed 3–3–15; 8:45 am] filing. Finally, the Commission notes BILLING CODE 8011–01–P whether any of the issuers below are that the Exchange represents that it has operating. Each of the issuers below been in communication with TPHs about the changes proposed in the either confirmed that they were no SECURITIES AND EXCHANGE longer operating or were now private instant filing and implementation issues COMMISSION companies, failed to respond to the since August 19, 2014, and has provided training on a Floor Broker Workstation Commission’s inquiry about their [File No. 500–1] (‘‘FBW) to support the combo indicator operating status, did not have an and the entry of complex orders with up In the Matter of Adex Media, Inc. et al.; operational address, or failed to provide to twelve legs.19 Order of Suspension of Trading their registered agent with an Accordingly, the Commission finds operational address. The staff of the that good cause exists for approving the March 2, 2015. Securities and Exchange Commission proposed rule change on an accelerated It appears to the Securities and also determined that none of the issuers basis. Exchange Commission that there is a below has filed any information with lack of current and accurate information OTC Markets Group, Inc. or the IV. Conclusion concerning the securities of each of the Securities and Exchange Commission It is therefore ordered, pursuant to issuers detailed below because for the past year. Section 19(b)(2) of the Act,20 that the questions have arisen as to their Information regarding Issuer Ticker operating status * 1. Adex Media, Inc ..................................................................................................................................................... ADXM .......... 2 2. AdStar, Inc ............................................................................................................................................................. ADST ........... 1 3. Alternative Green Technologies, Inc ..................................................................................................................... AGTI ............ 1 4. American City Bank (Los Angeles, CA) ................................................................................................................ ACBK .......... 1 5. American Mold Guard, Inc ..................................................................................................................................... AMGI ........... 1 6. American Uranium Corp ........................................................................................................................................ ACUC .......... 1 7. Americana Distribution, Inc .................................................................................................................................... ADBN .......... 1 8. Atlantis Technology Group .................................................................................................................................... ATNP ........... 1 9. Azure Dynamics Corp ............................................................................................................................................ AZDDQ ........ 1 10. Bald Eagle Energy, Inc ........................................................................................................................................ BEEI ............ 1 11. Betawave Corp .................................................................................................................................................... BWAV .......... 1 12. Beverly Hills Bancorp, Inc .................................................................................................................................... BHBCQ ....... 2 13. Blue Holdings, Inc ................................................................................................................................................ BLHI ............ 1 14. California-Michigan Land & Water Co ................................................................................................................. CMLW ......... 2 15. Cannon Exploration, Inc ...................................................................................................................................... CNEX .......... 1 16. Carlton Companies, Inc (The) ............................................................................................................................. CTNO .......... 1 17. China Daqing M&H Petroleum, Inc ..................................................................................................................... CHDP .......... 1 18. China Gateway Corp ........................................................................................................................................... CGWY ......... 1 19. China M161 Network Co ..................................................................................................................................... CMNW ......... 1 20. ClearPoint Business Resources, Inc ................................................................................................................... CPBRQ ....... 1 21. Collexis Holdings, Inc .......................................................................................................................................... CLXS ........... 1 22. Colonial Capital Trust IV ...................................................................................................................................... CBCPQ ....... 1 23. CommercePlanet, Inc .......................................................................................................................................... CPLT ........... 1 24. Commodore Applied Technologies, Inc ............................................................................................................... CXIA ............ 2 25. Composite Power Corp ........................................................................................................................................ CPWW ........ 1 26. Consolidated Plen Tech Electronics, Inc ............................................................................................................. CSPT ........... 1 27. Consumer Products Services Group, Inc ............................................................................................................ CPSV .......... 1 28. Corprate Data Sciences, Inc ................................................................................................................................ CODS .......... 1 29. Corprate Management Solutions, Inc .................................................................................................................. YDGE .......... 1 30. Data Evolution Holdings, Inc ............................................................................................................................... DTEV ........... 1 31. Degama Software Solutions, Inc ......................................................................................................................... DGMA ......... 1 32. EarthFirst Technologies, Inc ................................................................................................................................ EFTI ............ 2 33. ebank Financial Services, Inc .............................................................................................................................. EBDC .......... 2 mstockstill on DSK4VPTVN1PROD with NOTICES 34. Ecuity, Inc ............................................................................................................................................................ ECUI ........... 1 35. EM International Enterprises Corp ...................................................................................................................... EMIE ........... 1 tickets. The Exchange states that PULSe, the specifying how orders with more than 12 legs specifically relates to Order Ticket requirements. enhanced version of FBW, and proprietary systems should be split across multiple tickets without See SR–CBOE–2014–015 Notice, supra note 17. that TPHs have designed to comply with the single further programming or configuration. Id. at 6147. 19 See Notice, supra note 3 at 6146. order ticket requirements of SR–CBOE–2014–015 18 SR–CBOE–2014–015 provided for several 20 15 U.S.C. 78s(b)(2). are capable of complying with the requirement changes to various CBOE Rules; this proposal 21 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 18:11 Mar 03, 2015 Jkt 235001 PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 E:\FR\FM\04MRN1.SGM 04MRN1


Document Created: 2018-02-21 09:31:35
Document Modified: 2018-02-21 09:31:35
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation80 FR 11717 
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