80 FR 13049 - Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 1082.02 and .03

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 48 (March 12, 2015)

Page Range		13049-13051
FR Document		2015-05605
Federal Register, Volume 80 Issue 48 (Thursday, March 12, 2015)
[Federal Register Volume 80, Number 48 (Thursday, March 12, 2015)]
[Notices]
[Pages 13049-13051]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-05605]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74453; File No. SR-Phlx-2015-10]


Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Amend 
Rule 1082.02 and .03

March 6, 2015.
    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 February 23, 2015, NASDAQ OMX PHLX LLC (``Phlx'' or 
``Exchange'') filed with the Securities and Exchange Commission (the 
``Commission'') a proposed rule change as described in Items I and II 
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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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Rule 1082.02 and .03, as described 
below.
    The text of the proposed rule change is below. Proposed new 
language is italicized. Proposed deletions are in brackets.
* * * * *

Rule 1082. Firm Quotations

    (a)-(d) No change.
    .01 No change.
    .02 Locked Markets. In the event that an SQT, RSQT, and/or 
specialist's electronically submitted quotations interact with the 
electronically submitted quotations of other SQTs, RSQTs and/or the 
specialist, resulting in the dissemination of a ``locked'' quotation 
(e.g., $1.00 bid--1.00 offer), the [following shall occur:
    (a) The Exchange will disseminate the locked market and both 
quotations will be deemed ``firm'' disseminated market quotations;
    (b) A ``counting period'' not to exceed .25 of one second will 
begin during which SQTs, RSQTs and/or specialists whose quotations are 
locked may eliminate the locked market. Provided, however, that in 
accordance with subparagraph (a) above, such SQT, RSQT and/or 
specialist shall be obligated to execute orders at their disseminated 
quotation. The duration of the counting period will be established by 
the Exchange, will be the same for all options traded on the Exchange, 
and will not exceed .25 of one second. The duration of the counting 
period will be published in an Options Trader Alert, which will be 
available on the Exchange's Web site.
    During the counting period SQTs and specialists located in the 
Crowd Area in which the option that is the subject of the locked market 
is traded will continue to be obligated to respond to Floor Brokers as 
set forth in Rule 1014, Commentary .05(c), and will continue to be 
obligated for one contract in open outcry to other SQTs, non-SQT ROTs, 
and specialists. If at the end of the counting period the quotations 
remain locked, the] locked quotations will automatically execute 
against each other in accordance with the allocation algorithm set 
forth in Rule 1014(g)(vii).
    [The quotation that is locked may be executed by an order during 
the counting period.]
    .03 Crossed Markets. The Exchange will not disseminate an 
internally crossed market (e.g., $1.10 bid, 1.00 offer). If an SQT, 
RSQT or specialist electronically submits a quotation [in a Streaming 
Quote Option] (``incoming quotation'') that would cross an existing 
quotation (``existing quotation''), the Exchange will[: (i)] Change the 
incoming quotation such that it locks the existing quotation and 
automatically execute the locked quotations against each other in 
accordance with the allocation algorithm set forth in Rule 
1014(g)(vii).
    [; (ii) send a notice to the SQT, RSQT or specialist that submitted 
the existing quotation indicating that its quotation was crossed; and 
(iii) send a notice to the specialist, SQT or RSQT that submitted the 
incoming quotation, indicating that its quotation crossed the existing 
quotation and was changed. Such a locked market shall be handled in 
accordance with Commentary .01 above. During the counting period, if 
the existing quotation is cancelled subsequent to the time the incoming 
quotation is changed, the incoming quotation will automatically be 
restored to its original terms.]
* * * * *

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.

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

1. Purpose
    The purpose of the proposal is to amend two commentaries to Rule 
1082 because the timers no longer operate. Rule 1082.02 currently 
addresses what occurs when a Streaming Quote Trader's (``SQT''), Remote 
SQT's (``RSQT''), and/or specialist's electronically submitted 
quotations interact with the electronically submitted quotations of 
other SQTs, RSQTs and/or the specialist. Under this provision, the 
Exchange disseminates the resulting locked market and both quotations 
are deemed ``firm'' disseminated market quotations. Furthermore, a 
counting period not to exceed .25 of one second may begin during which 
SQTs, RSQTs and/or specialists whose quotations are locked may 
eliminate the locked market, provided, however, that such SQT, RSQT 
and/or specialist shall nevertheless be obligated to execute orders at 
that price. The rule provides that the duration of the counting period 
is established by the Exchange, will be the same for all options traded 
on the Exchange and will not exceed .25 of one second.\3\ In March 
2010, the Exchange reduced this counting period to zero, which is 
within the range contemplated by the rule (does not exceed .25 of one

[[Page 13050]]

second).\4\ The result is that any such locking quotations trade 
immediately with no delay. Accordingly, the Exchange is proposing to 
amend Rule 1080.02 to reflect this.
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    \3\ The duration of the counting period is the same for all 
options traded on the Exchange and is published in an Options Trader 
Alert, which is available on the Exchange's Web site.
    \4\ See http://www.nasdaqtrader.com/MicroNews.aspx?id=OTA2010-16
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    Similarly, Rule 1082.03 currently addresses what occurs when an 
SQT's, RSQT's, and/or specialist's electronically submitted quotations 
cross the electronically submitted quotations of other SQTs, RSQTs and/
or the specialist. Under the rule, the resulting crossed market is not 
disseminated, but rather the incoming crossing quotation is changed 
such that it locks the existing quotation and the crossing SQT, RSQT or 
specialist is notified thereof. The specialist, SQT or RSQT that 
submitted the existing quotation is notified that the quotation was 
crossed. The locked market is disseminated for the time of the counting 
period. In March 2010, the Exchange reduced this counting period to 
zero as well. The result is that any such crossing quotations trade 
immediately with no delay at the locked price.\5\ Accordingly, the 
Exchange is proposing to amend Rule 1080.02 [sic] to reflect this. As 
part of deleting the counting period respecting crossed quotations, the 
Exchange is also eliminating the notice to the SQT, RSQT or specialist 
that submitted the existing quotation indicating that its quotation was 
crossed as well as the notice to the specialist, SQT or RSQT that 
submitted the incoming quotation indicating that its quotation crossed 
the existing quotation, because such notice is no longer necessary. The 
purpose of the notice was to inform the SQT, RSQT or specialist of the 
counting period in case the SQT, RSQT or specialist sought to update 
the quotation; now that an automatic execution occurs, the quotation 
cannot be updated because a trade will already have occurred.
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    \5\ Id.
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    The Exchange believes that eliminating the counting period in both 
situations is appropriate because it results in an immediate execution; 
it also eliminates potential firm quote concerns respecting those 
quotations during the counting period.
    Noting that the counting periods have been set to zero, the 
Exchange eliminated the counting period from its system altogether and 
is now updating its rule to reflect that. The Exchange believes that 
its electronic quoting participants (SQTs, RSQTs and specialists) 
benefit from an immediate execution, because they have certainty of 
what has executed right away and can determine how to update their 
quotes afterwards.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \6\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \7\ in particular, in that it is designed to promote 
just and equitable principles of trade and protect investors and the 
public interest by permitting locking and crossing quotations to trade 
immediately, without a delay. Specifically, such immediate execution 
without a delay timer should help the market operate more efficiently. 
Moreover, market making participants can submit new quotes to the 
marketplace more quickly after such executions.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
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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 not necessary or appropriate in 
furtherance of the purposes of the Act. In fact, the immediate 
executions under this proposal should help the Exchange compete with 
other exchanges. With respect to intra-market competition among 
specialists, SQTs and RSQTs, such competition should be enhanced, 
because their respective quotations execute immediately, without a 
delay.

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

    No written comments were either solicited or received.

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 \8\ and Rule 19b-4(f)(6) thereunder.\9\ 
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 for 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 \10\ and Rule 19b-
4(f)(6)(iii) thereunder.\11\
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    \8\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \9\ 17 CFR 240.19b-4(f)(6).
    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the Exchange to give the Commission written notice of the 
Exchange's intent to file the proposed rule change, along with a 
brief description and text of the proposed rule change, at least 
five business days prior to the date of filing of the proposed rule 
change, or such shorter time as designated by the Commission. The 
Exchange has satisfied this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \12\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\13\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposed 
rule change may become operative immediately upon filing. The 
Commission previously recognized that continued locking and crossing of 
the market can negatively impact market quality.\14\ The Commission 
notes that the Exchange's proposal is designed to trade locked or 
crossed quotations without delay. The Commission believes that waiver 
of the operative delay is consistent with the protection of investors 
and the public interest because such waiver would allow the Exchange to 
implement a rule that would provide for the immediate execution of 
locked or crossed markets. Accordingly, the Commission hereby waives 
the 30-day operative delay and designates the proposal operative upon 
filing.\15\
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    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
    \14\ See Securities Exchange Act Release No. 34-43863 (August 
23, 2002), 67 FR 55897, 55900 n.37 (August 30, 2002) (SR-NASD-2002-
56).
    \15\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    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. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule

[[Page 13051]]

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 [email protected]. Please include 
File Number SR-Phlx-2015-10 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-Phlx-2015-10. 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 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-Phlx-2015-10, 
and should be submitted on or before April 2, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2015-05605 Filed 3-11-15; 8:45 am]
BILLING CODE 8011-01-P
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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13050 Federal Register / Vol. 80, No. 48 / Thursday, March 12, 2015 / Notices

second).4 The result is that any such determine how to update their quotes of the Act 10 and Rule 19b–4(f)(6)(iii)
locking quotations trade immediately afterwards. thereunder.11
with no delay. Accordingly, the A proposed rule change filed under
2. Statutory Basis Rule 19b–4(f)(6) 12 normally does not
Exchange is proposing to amend Rule
1080.02 to reflect this. The Exchange believes that its become operative prior to 30 days after
Similarly, Rule 1082.03 currently proposal is consistent with Section 6(b) the date of the filing. However, pursuant
addresses what occurs when an SQT’s, of the Act 6 in general, and furthers the to Rule 19b–4(f)(6)(iii),13 the
RSQT’s, and/or specialist’s objectives of Section 6(b)(5) of the Act 7 Commission may designate a shorter
electronically submitted quotations in particular, in that it is designed to time if such action is consistent with the
cross the electronically submitted promote just and equitable principles of protection of investors and the public
quotations of other SQTs, RSQTs and/or trade and protect investors and the interest. The Exchange has asked the
the specialist. Under the rule, the public interest by permitting locking Commission to waive the 30-day
resulting crossed market is not and crossing quotations to trade operative delay so that the proposed
disseminated, but rather the incoming immediately, without a delay. rule change may become operative
crossing quotation is changed such that Specifically, such immediate execution immediately upon filing. The
it locks the existing quotation and the without a delay timer should help the Commission previously recognized that
crossing SQT, RSQT or specialist is market operate more efficiently. continued locking and crossing of the
notified thereof. The specialist, SQT or Moreover, market making participants market can negatively impact market
RSQT that submitted the existing can submit new quotes to the quality.14 The Commission notes that
quotation is notified that the quotation marketplace more quickly after such the Exchange’s proposal is designed to
was crossed. The locked market is executions. trade locked or crossed quotations
disseminated for the time of the without delay. The Commission
counting period. In March 2010, the B. Self-Regulatory Organization’s believes that waiver of the operative
Exchange reduced this counting period Statement on Burden on Competition delay is consistent with the protection
to zero as well. The result is that any The Exchange does not believe that of investors and the public interest
such crossing quotations trade the proposed rule change will impose because such waiver would allow the
immediately with no delay at the locked any burden on competition not Exchange to implement a rule that
price.5 Accordingly, the Exchange is necessary or appropriate in furtherance would provide for the immediate
proposing to amend Rule 1080.02 [sic] of the purposes of the Act. In fact, the execution of locked or crossed markets.
to reflect this. As part of deleting the immediate executions under this Accordingly, the Commission hereby
counting period respecting crossed proposal should help the Exchange waives the 30-day operative delay and
quotations, the Exchange is also compete with other exchanges. With designates the proposal operative upon
eliminating the notice to the SQT, RSQT respect to intra-market competition filing.15
or specialist that submitted the existing among specialists, SQTs and RSQTs, At any time within 60 days of the
quotation indicating that its quotation such competition should be enhanced, filing of the proposed rule change, the
was crossed as well as the notice to the because their respective quotations Commission summarily may
specialist, SQT or RSQT that submitted execute immediately, without a delay. temporarily suspend such rule change if
the incoming quotation indicating that it appears to the Commission that such
its quotation crossed the existing C. Self-Regulatory Organization’s action is necessary or appropriate in the
quotation, because such notice is no Statement on Comments on the public interest, for the protection of
longer necessary. The purpose of the Proposed Rule Change Received From investors, or otherwise in furtherance of
notice was to inform the SQT, RSQT or Members, Participants, or Others the purposes of the Act. If the
specialist of the counting period in case No written comments were either Commission takes such action, the
the SQT, RSQT or specialist sought to solicited or received. Commission shall institute proceedings
update the quotation; now that an to determine whether the proposed rule
III. Date of Effectiveness of the should be approved or disapproved.
automatic execution occurs, the
Proposed Rule Change and Timing for
quotation cannot be updated because a IV. Solicitation of Comments
Commission Action
trade will already have occurred.
The Exchange believes that The Exchange has filed the proposed Interested persons are invited to
eliminating the counting period in both rule change pursuant to Section submit written data, views, and
situations is appropriate because it 19(b)(3)(A)(iii) of the Act 8 and Rule arguments concerning the foregoing,
results in an immediate execution; it 19b–4(f)(6) thereunder.9 Because the including whether the proposed rule
also eliminates potential firm quote proposed rule change does not: (i)
10 15 U.S.C. 78s(b)(3)(A).
concerns respecting those quotations Significantly affect the protection of 11 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
during the counting period. investors or the public interest; (ii) 4(f)(6)(iii) requires the Exchange to give the
Noting that the counting periods have impose any significant burden on Commission written notice of the Exchange’s intent
been set to zero, the Exchange competition; and (iii) become operative to file the proposed rule change, along with a brief
eliminated the counting period from its for 30 days from the date on which it description and text of the proposed rule change,
at least five business days prior to the date of filing
system altogether and is now updating was filed, or such shorter time as the of the proposed rule change, or such shorter time
its rule to reflect that. The Exchange Commission may designate, if as designated by the Commission. The Exchange
asabaliauskas on DSK5VPTVN1PROD with NOTICES

believes that its electronic quoting consistent with the protection of has satisfied this requirement.
participants (SQTs, RSQTs and investors and the public interest, the 12 17 CFR 240.19b–4(f)(6).
13 17 CFR 240.19b–4(f)(6)(iii).
specialists) benefit from an immediate proposed rule change has become
14 See Securities Exchange Act Release No. 34–
execution, because they have certainty effective pursuant to Section 19(b)(3)(A)
43863 (August 23, 2002), 67 FR 55897, 55900 n.37
of what has executed right away and can (August 30, 2002) (SR–NASD–2002–56).
6 15 U.S.C. 78f(b). 15 For purposes only of waiving the 30-day
4 See 7 15 U.S.C. 78f(b)(5).
http://www.nasdaqtrader.com/ operative delay, the Commission has considered the
MicroNews.aspx?id=OTA2010-16 8 15 U.S.C. 78s(b)(3)(A)(iii).
proposed rule’s impact on efficiency, competition,
5 Id. 9 17 CFR 240.19b–4(f)(6). and capital formation. See 15 U.S.C. 78c(f).

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change is consistent with the Act. SECURITIES AND EXCHANGE the most significant parts of such
Comments may be submitted by any of COMMISSION statements.
the following methods: A. Self-Regulatory Organization’s
[Release No. 34–74451; File No. SR–BYX–
Electronic Comments 2015–14] Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
• Use the Commission’s Internet Self-Regulatory Organizations; BATS Change
comment form (http://www.sec.gov/ Y-Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed 1. Purpose
rules/sro.shtml); or
Rule Change To Amend Rule 11.13, The Exchange proposes to amend
• Send an email to rule-comments@
Order Execution, To Delete References Rule 11.13, Order Execution, to delete
sec.gov. Please include File Number SR–
to the ROLF Routing Option, Which references under subparagraphs
Phlx–2015–10 on the subject line.
Routed Orders to LavaFlow ECN (a)(3)(H) and (a)(3)(M) to the ROLF
Paper Comments routing option, which routed to
March 6, 2015. LavaFlow ECN. These changes are being
• Send paper comments in triplicate Pursuant to Section 19(b)(1) of the proposed in response to LavaFlow ECN
to Secretary, Securities and Exchange Securities Exchange Act of 1934 (the ceasing market operations on Friday,
Commission, 100 F Street NE., ‘‘Act’’),1 and Rule 19b–4 thereunder,2 January 30, 2015. Under Rule
Washington, DC 20549–1090. notice is hereby given that on February 11.13(a)(3)(M), an order utilizing the
23, 2015, BATS Y-Exchange, Inc. (the ROLF routing option first checked the
All submissions should refer to File ‘‘Exchange’’ or ‘‘BYX’’) filed with the System 5 for available shares and was
Number SR–Phlx–2015–10. This file Securities and Exchange Commission then routed to the LavaFlow ECN. If
number should be included on the (‘‘Commission’’) the proposed rule shares remained unexecuted after being
subject line if email is used. To help the change as described in Items I and II routed, they were cancelled, unless
Commission process and review your below, which Items have been prepared otherwise instructed by the User.6 In
comments more efficiently, please use by the Exchange. The Exchange has addition, under Rule 11.13(a)(3)(H), a
only one method. The Commission will designated this proposal as a ‘‘non- User was able to couple the Post to
post all comments on the Commission’s controversial’’ proposed rule change Away routing option and ROLF routing
Internet Web site (http://www.sec.gov/ pursuant to Section 19(b)(3)(A) of the option. The grouping of the Post to
rules/sro.shtml). Copies of the Act 3 and Rule 19b–4(f)(6)(iii) Away and ROLF routing options
submission, all subsequent thereunder,4 which renders it effective instructed the System to route and post
amendments, all written statements upon filing with the Commission. The the order on LavaFlow ECN. As of
with respect to the proposed rule Commission is publishing this notice to February 2, 2015, the Exchange, via
change that are filed with the solicit comments on the proposed rule BATS Trading, the Exchange’s affiliated
Commission, and all written change from interested persons. routing broker-dealer, was no longer
communications relating to the able to route orders to LavaFlow ECN
I. Self-Regulatory Organization’s
proposed rule change between the because it ceased operations. As a
Statement of the Terms of the Substance
Commission and any person, other than result, the Exchange no longer offers the
of the Proposed Rule Change
those that may be withheld from the ROLF routing option nor permit it to be
public in accordance with the The Exchange filed a proposal to coupled with a Post to Away routing
provisions of 5 U.S.C. 552, will be amend Rule 11.13, Order Execution, to option. Therefore, the Exchange
available for Web site viewing and delete references to the ROLF routing proposes to delete the ROLF routing
printing in the Commission’s Public option, which routed orders to option under Rule 11.13(a)(3)(M) as well
Reference Room, 100 F Street NE., LavaFlow ECN. as a reference to the ROLF routing
Washington, DC 20549 on official The text of the proposed rule change
option under Rule 11.13(a)(3)(H).
business days between the hours of is available at the Exchange’s Web site
10:00 a.m. and 3:00 p.m. Copies of such at www.batstrading.com, at the 2. Statutory Basis
filing also will be available for principal office of the Exchange, and at The Exchange believes that its
inspection and copying at the principal the Commission’s Public Reference proposal is consistent with Section 6(b)
offices of the Exchange. All comments Room. of the Act 7 in general, and furthers the
received will be posted without change; II. Self-Regulatory Organization’s objectives of Section 6(b)(5) of the Act 8
the Commission does not edit personal Statement of the Purpose of, and in particular, in that it is designed to
identifying information from Statutory Basis for, the Proposed Rule promote just and equitable principles of
submissions. You should submit only Change trade, to foster cooperation and
information that you wish to make coordination with persons engaged in
In its filing with the Commission, the facilitating transactions in securities, to
available publicly. All submissions
Exchange included statements remove impediments to and perfect the
should refer to File Number SR–Phlx–
concerning the purpose of and basis for mechanism of a free and open market
2015–10, and should be submitted on or the proposed rule change and discussed
before April 2, 2015. and a national market system and, in
any comments it received on the
For the Commission, by the Division of proposed rule change. The text of these 5 Exchange Rule 1.5(aa) defines ‘‘System’’ as ‘‘the
asabaliauskas on DSK5VPTVN1PROD with NOTICES

Trading and Markets, pursuant to delegated statements may be examined at the electronic communications and trading facility
authority.16 places specified in Item IV below. The designated by the Board through which securities
Jill M. Peterson, Exchange has prepared summaries, set orders of Users are consolidated for ranking,
execution and, when applicable, routing away.’’
Assistant Secretary. forth in Sections A, B, and C below, of 6 The term ‘‘User’’ is defined as ‘‘any Member or

[FR Doc. 2015–05605 Filed 3–11–15; 8:45 am] Sponsored Participant who is authorized to obtain
1 15 U.S.C. 78s(b)(1). access to the System pursuant to Rule 11.3.’’ See
BILLING CODE 8011–01–P 2 17 CFR 240.19b–4. Exchange Rule 1.5(cc).
3 15 U.S.C. 78s(b)(3)(A). 7 15 U.S.C. 78f(b).
16 17 CFR 200.30–3(a)(12). 4 17 CFR 240.19b–4(f)(6)(iii). 8 15 U.S.C. 78f(b)(5).

VerDate Sep<11>2014 17:40 Mar 11, 2015 Jkt 235001 PO 00000 Frm 00078 Fmt 4703 Sfmt 4703 E:\FR\FM\12MRN1.SGM 12MRN1
Document Created: 2018-02-21 09:36:09
Document Modified: 2018-02-21 09:36:09
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
FR Citation		80 FR 13049