80 FR 13047 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Pilot Period for the Exchange's Retail Liquidity Program, Which Is Currently Scheduled To Expire on March 31, 2015, Until September 30, 2015
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 48 (March 12, 2015)
Federal Register Volume 80, Issue 48 (March 12, 2015)
| Page Range | 13047-13049 | |
| FR Document | 2015-05607 |
[Federal Register Volume 80, Number 48 (Thursday, March 12, 2015)] [Notices] [Pages 13047-13049] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-05607] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-74455; File No. SR-NYSEMKT-2015-14] Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Pilot Period for the Exchange's Retail Liquidity Program, Which Is Currently Scheduled To Expire on March 31, 2015, Until September 30, 2015 March 6, 2015. 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 February 27, 2015, NYSE MKT LLC (the ``Exchange'' or ``NYSE MKT'') 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. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to extend the pilot period for the Exchange's Retail Liquidity Program (the ``Retail Liquidity Program'' or the ``Program''), which is currently scheduled to expire on March 31, 2015, until September 30, 2015. The text of the proposed rule change is available on the Exchange's Web site at www.nyse.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 the Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to extend the pilot period of the Retail Liquidity Program,\3\ currently scheduled to expire on March 31, 2015, until September 30, 2015. --------------------------------------------------------------------------- \3\ See Securities Exchange Act Release No. 72625 (July 16, 2014), 79 FR 42566 (July 22, 2014) (SR-NYSEMKT-2014-60). --------------------------------------------------------------------------- Background In July 2012, the Commission approved the Retail Liquidity Program on a pilot basis.\4\ The Program is designed to attract retail order flow to the Exchange, and allows such order flow to receive potential price improvement. The Program is currently limited to trades occurring at prices equal to or greater than $1.00 per share. Under the Program, Retail Liquidity Providers (``RLPs'') are able to provide potential price improvement in the form of a non-displayed order that is priced better than the Exchange's best protected bid or offer (``PBBO''), called a Retail Price Improvement Order (``RPI''). When there is an RPI in a particular security, the Exchange disseminates an indicator, known as the Retail Liquidity Identifier, indicating that such interest exists. Retail Member Organizations (``RMOs'') can submit a Retail Order to the Exchange, which would interact, to the extent possible, with available contra-side RPIs. --------------------------------------------------------------------------- \4\ See Securities Exchange Act Release No. 67347 (July 3, 2012), 77 FR 40673 (July 10, 2012) (``RLP Approval Order'') (SR- NYSEAmex-2011-84). --------------------------------------------------------------------------- [[Page 13048]] The Retail Liquidity Program was approved by the Commission on a pilot basis. Pursuant to NYSE MKT Rule 107C(m)--Equities, the pilot period for the Program is scheduled to end on March 31, 2015. Proposal To Extend the Operation of the Program The Exchange established the Retail Liquidity Program in an attempt to attract retail order flow to the Exchange by potentially providing price improvement to such order flow. The Exchange believes that the Program promotes competition for retail order flow by allowing Exchange members to submit RPIs to interact with Retail Orders. Such competition has the ability to promote efficiency by facilitating the price discovery process and generating additional investor interest in trading securities, thereby promoting capital formation. The Exchange believes that extending the pilot is appropriate because it will allow the Exchange and the Commission additional time to analyze data regarding the Program that the Exchange has committed to provide.\5\ As such, the Exchange believes that it is appropriate to extend the current operation of the Program.\6\ Through this filing, the Exchange seeks to amend NYSE MKT Rule 107C(m)--Equities and extend the current pilot period of the Program until September 30, 2015. --------------------------------------------------------------------------- \5\ See id. at 40681. \6\ Concurrently with this filing, the Exchange has submitted a request for an extension of the exemption under Regulation NMS Rule 612 previously granted by the Commission that permits it to accept and rank the undisplayed RPIs. See Letter from Martha Redding, Senior Counsel, NYSE Group, Inc. to Brent J. Fields, Secretary, Securities and Exchange Commission, dated February 27, 2015. --------------------------------------------------------------------------- 2. Statutory Basis The proposed rule change is consistent with Section 6(b) of the Act,\7\ in general, and furthers the objectives of Section 6(b)(5),\8\ 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. The Exchange believes that extending the pilot period for the Retail Liquidity Program is consistent with these principles because the Program is reasonably designed to attract retail order flow to the exchange environment, while helping to ensure that retail investors benefit from the better price that liquidity providers are willing to give their orders. Additionally, as previously stated, the competition promoted by the Program may facilitate the price discovery process and potentially generate additional investor interest in trading securities. The extension of the pilot period will allow the Commission and the Exchange to continue to monitor the Program for its potential effects on public price discovery, and on the broader market structure. --------------------------------------------------------------------------- \7\ 15 U.S.C. 78f(b). \8\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- 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 proposed rule change simply extends an established pilot program for an additional six months, thus allowing the Retail Liquidity Program to enhance competition for retail order flow and contribute to the public price discovery process. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act \9\ and Rule 19b-4(f)(6) thereunder.\10\ Because the 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 prior to 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b- 4(f)(6)(iii) thereunder. --------------------------------------------------------------------------- \9\ 15 U.S.C. 78s(b)(3)(A)(iii). \10\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- A proposed rule change filed under Rule 19b-4(f)(6) \11\ normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b4(f)(6)(iii),\12\ the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. --------------------------------------------------------------------------- \11\ 17 CFR 240.19b-4(f)(6). \12\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- At any time within 60 days of the filing of such 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 under Section 19(b)(2)(B) \13\ of the Act to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \13\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- 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 CommentsUse 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-NYSEMKT-2015-14 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-NYSEMKT-2015-14. 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 [[Page 13049]] filing also will be available for inspection and copying at the principal offices 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-NYSEMKT-2015-14, and should be submitted on or before April 2, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\14\ --------------------------------------------------------------------------- \14\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Jill M. Peterson, Assistant Secretary. [FR Doc. 2015-05607 Filed 3-11-15; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 80, No. 48 / Thursday, March 12, 2015 / Notices 13047
III. Discussion and Commission IV. Conclusion currently scheduled to expire on March
Findings On the basis of the foregoing, the 31, 2015, until September 30, 2015. The
Commission finds that the proposal is text of the proposed rule change is
Section 19(b)(2)(C) of the Act 4 directs available on the Exchange’s Web site at
the Commission to approve a proposed consistent with the requirements of the
Act and in particular with the www.nyse.com, at the principal office of
rule change of a self-regulatory the Exchange, and at the Commission’s
requirements of Section 17A of the Act 9
organization if the Commission finds Public Reference Room.
and the rules and regulations
that such proposed rule change is
thereunder. II. Self-Regulatory Organization’s
consistent with the requirements of the It is therefore ordered, pursuant to
Act and the rules and regulations Statement of the Purpose of, and
Section 19(b)(2) of the Act,10 that the Statutory Basis for, the Proposed Rule
thereunder applicable to such self- proposed rule change (SR–ICC–2015– Change
regulatory organization. Section 001) be, and hereby is, approved.11
17A(b)(3)(F) of the Act 5 requires, among In its filing with the Commission, the
For the Commission, by the Division of self-regulatory organization included
other things, that the rules of a clearing
Trading and Markets, pursuant to delegated statements concerning the purpose of,
agency are designed to promote the authority.12
prompt and accurate clearance and and basis for, the proposed rule change
Jill M. Peterson, and discussed any comments it received
settlement of securities transactions
Assistant Secretary. on the proposed rule change. The text
and, to the extent applicable, derivative
[FR Doc. 2015–05602 Filed 3–11–15; 8:45 am] of those statements may be examined at
agreements, contracts, and transactions,
to assure the safeguarding of securities BILLING CODE 8011–01–P the places specified in Item IV below.
and funds which are in the custody or The Exchange has prepared summaries,
control of the clearing agency or for set forth in sections A, B, and C below,
SECURITIES AND EXCHANGE of the most significant parts of such
which it is responsible and, in general, COMMISSION
to protect investors and the public statements.
interest. [Release No. 34–74455; File No. SR– A. Self-Regulatory Organization’s
NYSEMKT–2015–14] Statement of the Purpose of, and the
The Commission finds that ICC’s
proposed revisions to its End-of-Day Self-Regulatory Organizations; NYSE Statutory Basis for, the Proposed Rule
Price Discovery Policies and Procedures MKT LLC; Notice of Filing and Change
is consistent with the requirements of Immediate Effectiveness of Proposed 1. Purpose
Section 17A of the Act 6 and regulations Rule Change To Extend the Pilot
The purpose of this filing is to extend
thereunder applicable to it, including Period for the Exchange’s Retail
the pilot period of the Retail Liquidity
the standards under Rule 17Ad–22.7 Liquidity Program, Which Is Currently
Program,3 currently scheduled to expire
The proposed rule change is designed to Scheduled To Expire on March 31,
on March 31, 2015, until September 30,
enhance ICC’s price discovery process 2015, Until September 30, 2015
2015.
by including all price submissions March 6, 2015.
(including those classified as obvious Background
Pursuant to Section 19(b)(1) of the
errors) in the process of determining In July 2012, the Commission
Securities Exchange Act of 1934
Firm Trades, thereby reducing price (‘‘Act’’),1 and Rule 19b–4 thereunder,2 approved the Retail Liquidity Program
submissions that may be classified as notice is hereby given that on February on a pilot basis.4 The Program is
obvious errors. In addition, the 27, 2015, NYSE MKT LLC (the designed to attract retail order flow to
proposed rule change would adjust the ‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with the Exchange, and allows such order
trading prices of Firm Trades that the Securities and Exchange flow to receive potential price
include a bid or offer classified as an Commission (‘‘SEC’’ or ‘‘Commission’’) improvement. The Program is currently
obvious error to fall within a predefined the proposed rule change as described limited to trades occurring at prices
range on either side of the EOD price, in Items I, II, and III below, which Items equal to or greater than $1.00 per share.
thereby limiting CPs’ potential P/L have been prepared by the Exchange. Under the Program, Retail Liquidity
exposure to obvious errors from the risk The Commission is publishing this Providers (‘‘RLPs’’) are able to provide
management perspective, while holding notice to solicit comments on the potential price improvement in the form
them accountable for their price proposed rule change from interested of a non-displayed order that is priced
submissions. Finally, the proposed rule persons. better than the Exchange’s best
change would assist CPs in unwinding protected bid or offer (‘‘PBBO’’), called
Firm Trades in certain index products I. Self-Regulatory Organization’s a Retail Price Improvement Order
by generating reversing trades at the Statement of the Terms of Substance of (‘‘RPI’’). When there is an RPI in a
EOD level based on liquidity. The the Proposed Rule Change particular security, the Exchange
Commission believes that the proposal The Exchange proposes to extend the disseminates an indicator, known as the
is therefore designed to promote the pilot period for the Exchange’s Retail Retail Liquidity Identifier, indicating
prompt and accurate clearance and Liquidity Program (the ‘‘Retail Liquidity that such interest exists. Retail Member
settlement of securities transactions and Program’’ or the ‘‘Program’’), which is Organizations (‘‘RMOs’’) can submit a
Retail Order to the Exchange, which
asabaliauskas on DSK5VPTVN1PROD with NOTICES
derivative agreements, contracts and
transactions cleared by ICC, consistent 9 15 U.S.C. 78q–1. would interact, to the extent possible,
with Section 17A(b)(3)(F) of the Act.8
10 15 U.S.C. 78s(b)(2). with available contra-side RPIs.
11 In approving the proposed rule change, the
Commission considered the proposal’s impact on 3 See Securities Exchange Act Release No. 72625
4 15 U.S.C. 78s(b)(2)(C). efficiency, competition and capital formation. 15 (July 16, 2014), 79 FR 42566 (July 22, 2014) (SR–
5 15 U.S.C. 78q–1(b)(3)(F). U.S.C. 78c(f). NYSEMKT–2014–60).
6 15 U.S.C. 78q–1. 12 17 CFR 200.30–3(a)(12). 4 See Securities Exchange Act Release No. 67347
7 17 CFR 240.17Ad–22. 1 15 U.S.C. 78s(b)(1).
(July 3, 2012), 77 FR 40673 (July 10, 2012) (‘‘RLP
8 15 U.S.C. 78q–1(b)(3)(F). 2 17 CFR 240.19b–4. Approval Order’’) (SR–NYSEAmex–2011–84).
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![Federal Register / Vol. 80, No. 48 / Thursday, March 12, 2015 / Notices 13049
filing also will be available for electronically submitted quotations existing quotation and was changed.
inspection and copying at the principal interact with the electronically Such a locked market shall be handled
offices of the Exchange. All comments submitted quotations of other SQTs, in accordance with Commentary .01
received will be posted without change; RSQTs and/or the specialist, resulting in above. During the counting period, if the
the Commission does not edit personal the dissemination of a ‘‘locked’’ existing quotation is cancelled
identifying information from quotation (e.g., $1.00 bid—1.00 offer), subsequent to the time the incoming
submissions. You should submit only the [following shall occur: quotation is changed, the incoming
information that you wish to make (a) The Exchange will disseminate the quotation will automatically be restored
available publicly. All submissions locked market and both quotations will to its original terms.]
should refer to File Number SR– be deemed ‘‘firm’’ disseminated market * * * * *
NYSEMKT–2015–14, and should be quotations;
submitted on or before April 2, 2015. (b) A ‘‘counting period’’ not to exceed II. Self-Regulatory Organization’s
.25 of one second will begin during Statement of the Purpose of, and
For the Commission, by the Division of Statutory Basis for, the Proposed Rule
Trading and Markets, pursuant to delegated
which SQTs, RSQTs and/or specialists
whose quotations are locked may Change
authority.14
Jill M. Peterson,
eliminate the locked market. Provided, In its filing with the Commission, the
however, that in accordance with Exchange included statements
Assistant Secretary.
subparagraph (a) above, such SQT, concerning the purpose of and basis for
[FR Doc. 2015–05607 Filed 3–11–15; 8:45 am]
RSQT and/or specialist shall be the proposed rule change and discussed
BILLING CODE 8011–01–P obligated to execute orders at their any comments it received on the
disseminated quotation. The duration of proposed rule change. The text of these
the counting period will be established statements may be examined at the
SECURITIES AND EXCHANGE by the Exchange, will be the same for all
COMMISSION places specified in Item IV below. The
options traded on the Exchange, and Exchange has prepared summaries, set
[Release No. 34–74453; File No. SR–Phlx– will not exceed .25 of one second. The forth in sections A, B, and C below, of
2015–10] duration of the counting period will be the most significant aspects of such
published in an Options Trader Alert, statements.
Self-Regulatory Organizations; which will be available on the
NASDAQ OMX PHLX LLC; Notice of Exchange’s Web site. A. Self-Regulatory Organization’s
Filing and Immediate Effectiveness of During the counting period SQTs and Statement of the Purpose of, and
Proposed Rule Change To Amend Rule specialists located in the Crowd Area in Statutory Basis for, the Proposed Rule
1082.02 and .03 which the option that is the subject of Change
March 6, 2015.
the locked market is traded will 1. Purpose
Pursuant to Section 19(b)(1) of the continue to be obligated to respond to
Floor Brokers as set forth in Rule 1014, The purpose of the proposal is to
Securities Exchange Act of 1934 (the amend two commentaries to Rule 1082
Commentary .05(c), and will continue to
‘‘Act’’),1 and Rule 19b–4 thereunder,2 because the timers no longer operate.
be obligated for one contract in open
notice is hereby given that on February Rule 1082.02 currently addresses what
outcry to other SQTs, non-SQT ROTs,
23, 2015, NASDAQ OMX PHLX LLC occurs when a Streaming Quote Trader’s
and specialists. If at the end of the
(‘‘Phlx’’ or ‘‘Exchange’’) filed with the (‘‘SQT’’), Remote SQT’s (‘‘RSQT’’), and/
counting period the quotations remain
Securities and Exchange Commission or specialist’s electronically submitted
locked, the] locked quotations will
(the ‘‘Commission’’) a proposed rule quotations interact with the
automatically execute against each other
change as described in Items I and II electronically submitted quotations of
in accordance with the allocation
below, which Items have been prepared other SQTs, RSQTs and/or the
algorithm set forth in Rule 1014(g)(vii).
by the Exchange. The Commission is specialist. Under this provision, the
[The quotation that is locked may be
publishing this notice to solicit Exchange disseminates the resulting
executed by an order during the
comments on the proposed rule change locked market and both quotations are
counting period.]
from interested persons. .03 Crossed Markets. The Exchange deemed ‘‘firm’’ disseminated market
will not disseminate an internally quotations. Furthermore, a counting
I. Self-Regulatory Organization’s
crossed market (e.g., $1.10 bid, 1.00 period not to exceed .25 of one second
Statement of the Terms of Substance of
offer). If an SQT, RSQT or specialist may begin during which SQTs, RSQTs
the Proposed Rule Change
electronically submits a quotation [in a and/or specialists whose quotations are
The Exchange proposes to amend locked may eliminate the locked market,
Rule 1082.02 and .03, as described Streaming Quote Option] (‘‘incoming
quotation’’) that would cross an existing provided, however, that such SQT,
below. RSQT and/or specialist shall
The text of the proposed rule change quotation (‘‘existing quotation’’), the
Exchange will[: (i)] Change the nevertheless be obligated to execute
is below. Proposed new language is orders at that price. The rule provides
italicized. Proposed deletions are in incoming quotation such that it locks
the existing quotation and automatically that the duration of the counting period
brackets. is established by the Exchange, will be
execute the locked quotations against
* * * * * the same for all options traded on the
each other in accordance with the
allocation algorithm set forth in Rule Exchange and will not exceed .25 of one
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Rule 1082. Firm Quotations
1014(g)(vii). second.3 In March 2010, the Exchange
(a)–(d) No change. reduced this counting period to zero,
.01 No change. [; (ii) send a notice to the SQT, RSQT
or specialist that submitted the existing which is within the range contemplated
.02 Locked Markets. In the event that by the rule (does not exceed .25 of one
an SQT, RSQT, and/or specialist’s quotation indicating that its quotation
was crossed; and (iii) send a notice to 3 The duration of the counting period is the same
14 17 CFR 200.30–3(a)(12). the specialist, SQT or RSQT that for all options traded on the Exchange and is
1 15 U.S.C. 78s(b)(1). submitted the incoming quotation, published in an Options Trader Alert, which is
2 17 CFR 240.19b–4. indicating that its quotation crossed the available on the Exchange’s Web site.
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Document Created: 2018-02-21 09:35:45
Document Modified: 2018-02-21 09:35:45
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 80 FR 13047 |
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