80 FR 19707 - Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 20.6 To Adopt a New Provision To Account for Erroneous Trades Occurring From Disruptions and/or Malfunctions of Exchange Systems
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 70 (April 13, 2015)
Federal Register Volume 80, Issue 70 (April 13, 2015)
| Page Range | 19707-19709 | |
| FR Document | 2015-08337 |
[Federal Register Volume 80, Number 70 (Monday, April 13, 2015)] [Notices] [Pages 19707-19709] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-08337] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-74666; File No. SR-BATS-2015-26] Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 20.6 To Adopt a New Provision To Account for Erroneous Trades Occurring From Disruptions and/or Malfunctions of Exchange Systems April 7, 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 April 1, 2015, BATS Exchange, Inc. (the ``Exchange'' or ``BATS'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Item II below, which Item has been prepared by the Exchange. The Exchange has designated this proposal as a ``non-controversial'' proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b- 4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with the Commission. 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. \3\ 15 U.S.C. 78s(b)(3)(A). \4\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of the Substance of the Proposed Rule Change The Exchange proposes to amend Rule 20.6, Nullification and Adjustment of Options Transactions including Obvious Errors, to adopt a new provision to account for erroneous trades occurring from disruptions and/or malfunctions of Exchange systems. The proposed rule change is based on the rules of NYSE Arca, Inc. (``NYSE Arca'') and the International Securities Exchange, LLC (``ISE'').\5\ Therefore, the Exchange has designated this proposal as non-controversial and provided the Commission with the notice required by Rule 19b-4(f)(6)(iii) under the Act.\6\ The text of the proposed rule change is available at the Exchange's Web site at www.batstrading.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. --------------------------------------------------------------------------- \5\ See ISE Rule 720A and NYSE Arca Rule 6.89. See also Securities Exchange Act Release No. 72490 (June 27, 2014), 79 FR 38105 (July 3, 2014) (SR-ISE-2014-34) (Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Establish New Rule 720A). The proposed rule change is also based in part on Nasdaq OMX PHLX, LLC (``PHLX'') Rule 1092(c)(ii)(A), and in addition, is substantially similar to Chicago Board Options Exchange, Inc. (``CBOE'') Rule 6.25(a)(3). \6\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- 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 parts of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Rule 20.6, Nullification and Adjustment of Options Transactions including Obvious Errors, to adopt a new provision to account for erroneous trades occurring from disruptions and/or malfunctions of Exchange systems. Specifically, proposed paragraph (k) to Rule 20.6 would provide that any transaction that arises out of a ``verifiable systems disruption or malfunction'' in the use or operation of an Exchange automated quotation, dissemination, execution, or communication system may either be nullified or adjusted by an Official. Under the proposed paragraph (k), an Official may act, on his or her own motion, to review erroneous transactions. The proposed rule change is based on the rules of NYSE Arca and the ISE.\7\ --------------------------------------------------------------------------- \7\ See supra note 5. --------------------------------------------------------------------------- According to the proposal, in the event of any verifiable disruption or malfunction in the use or operation of an Exchange automated quotation, dissemination, execution, or communication system, in which the nullification or modification of transactions may be necessary to maintain a fair and orderly market or the protection of investors and the public interest exists, an Official, on his or her own motion, may review such transactions and declare the transactions occurring during such period null and void or adjust the price of those transaction to their Theoretical Price, as defined in paragraph (b) of Rule 20.6. Pursuant to the proposal, an Official, absent extraordinary circumstances, must initiate action under this authority within sixty (60) minutes of the occurrence of the erroneous transaction that was a result of a verifiable disruption or malfunction. Each Options Member involved in the transaction shall be notified as soon as practicable, and any Options Member aggrieved by the action may appeal such action in accordance with the provisions of proposed renumbered paragraph (l) of Rule 20.6. Current subparagraph (k), which sets for the appeals process of decisions made by an [[Page 19708]] Official \8\ pursuant to Rule 20.6, would be renumbered as paragraph (l) and cross references to current paragraph (k) within Rule 20.6 would be updated to reference renumbered paragraph (l) accordingly. --------------------------------------------------------------------------- \8\ An Official is defined under current Rule 20.6(d) as ``[a]n Officer of the Exchange or such other employee designee of the Exchange that is trained in the application of this rule [20.6].'' --------------------------------------------------------------------------- The Exchange notes that the Commission recently approved amendments to Rule 20.6 \9\ and that other options markets are to file proposed rule changes with the Commission to harmonize their respective obvious and catastrophic error rules with Rule 20.6. The Exchange understands that the provision it proposes to add to Rule 20.6 herein is to be retained by other options exchanges as part of their harmonized rules. Therefore, the Exchange believes it is critical to its ability to maintain fair and orderly markets and to protect investors to propose to add this provision to its rules. --------------------------------------------------------------------------- \9\ See Securities Exchange Act. Release No. 74556 (March 20, 2015) (SR-BATS-2014-067). The Exchange notes that a comment letter received in response to the proposed rule change suggesting that the Exchange also include a rule provision covering verifiable disruptions or malfunctions of Exchange systems as proposed herein. See letter from Joanna Fields, Principal, Aplomb Strategies Inc. to Brent Fields, Secretary, Commission, dated March 23, 2015. --------------------------------------------------------------------------- The Exchange believes it is appropriate to provide the flexibility and authority provided for in proposed paragraph (k) to Rule 20.6 so as not to limit the Exchange's ability to plan for and respond to unforeseen problems and malfunctions. The proposed rule change would provide the Exchange with the same authority to nullify or adjust trades in the event of a ``verifiable disruption or malfunction'' in the use or operation of its systems as other exchanges have.\10\ For this reason, the Exchange believes that, in the interest of maintaining a fair and orderly market and for the protection of investors, authority to nullify or adjust trades in these circumstances, consistent with the authority on other exchanges, is warranted. --------------------------------------------------------------------------- \10\ See supra note 5. --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b)(5) of the Act,\11\ which requires, among other things, that the Exchange's rules be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments to and perfect the mechanism of a free and open market and a national market system. --------------------------------------------------------------------------- \11\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange believes the proposed rule change would remove impediments to and perfect the mechanism of a free and open market and national market system and promote a fair and orderly market because it would provide authority to the Exchange to nullify or adjust trades that may have resulted from a verifiable systems disruption or malfunction. The Exchange believes that it is appropriate to provide the flexibility and authority provided for in the proposed rule change so as not to limit the Exchange's ability to plan for and respond to unforeseen systems problems or malfunctions that may result in harm to the public. Allowing for the nullification or modification of transactions that result from verifiable disruptions and/or malfunctions of Exchange systems will offer market participants on the Exchange a level of relief not presently available. The Exchange further notes that when acting under its own motion of nullify or adjust trades pursuant to proposed paragraph (k) of Rule 20.6, the Exchange must consider whether taking such action would be in the interest of maintaining a fair and orderly market and for the protection of investors. The Exchange also notes that proposed rule change is based on the rules of other exchanges. 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. Rather, the Exchange believes the proposed rule change will enhance competition because it will align the Exchange's rules with the rules of other markets, including CBOE, NYSE Arca, the ISE, and PHLX. By adopting paragraph (k) to Rule 20.6 the Exchange will be in a position to treat transactions that are the result of a verifiable systems disruption or malfunction in a manner similar to other exchanges. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has neither solicited nor received written comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action 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 \12\ and Rule 19b- 4(f)(6)(iii) thereunder.\13\ --------------------------------------------------------------------------- \12\ 15 U.S.C. 78s(b)(3)(A). \13\ 17 CFR 240.19b-4(f)(6)(iii). As required under Rule 19b- 4(f)(6)(iii), the Exchange provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and the 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. --------------------------------------------------------------------------- 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 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 [email protected]. Please include File Number SR-BATS-2015-26 on the subject line. Paper Comments Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-BATS-2015-26. 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 [[Page 19709]] 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 office 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-BATS-2015-26, and should be submitted on or before May 4, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\14\ --------------------------------------------------------------------------- \14\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Brent J. Fields, Secretary. [FR Doc. 2015-08337 Filed 4-10-15; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 80, No. 70 / Monday, April 13, 2015 / Notices 19707
All submissions should refer to File ‘‘Act’’),1 and Rule 19b–4 thereunder,2 Exchange has prepared summaries, set
Number SR–CBOE–2015–032. This file notice is hereby given that on April 1, forth in Sections A, B, and C below, of
number should be included on the 2015, BATS Exchange, Inc. (the the most significant parts of such
subject line if email is used. To help the ‘‘Exchange’’ or ‘‘BATS’’) filed with the statements.
Commission process and review your Securities and Exchange Commission
A. Self-Regulatory Organization’s
comments more efficiently, please use (‘‘Commission’’) the proposed rule
Statement of the Purpose of, and
only one method. The Commission will change as described in Item II below,
Statutory Basis for, the Proposed Rule
post all comments on the Commission’s which Item has been prepared by the
Change
Internet Web site (http://www.sec.gov/ Exchange. The Exchange has designated
rules/sro.shtml). Copies of the this proposal as a ‘‘non-controversial’’ 1. Purpose
submission, all subsequent proposed rule change pursuant to The Exchange proposes to amend
amendments, all written statements Section 19(b)(3)(A) of the Act 3 and Rule Rule 20.6, Nullification and Adjustment
with respect to the proposed rule 19b–4(f)(6)(iii) thereunder,4 which of Options Transactions including
change that are filed with the renders it effective upon filing with the Obvious Errors, to adopt a new
Commission, and all written Commission. The Commission is provision to account for erroneous
communications relating to the publishing this notice to solicit trades occurring from disruptions and/
proposed rule change between the comments on the proposed rule change or malfunctions of Exchange systems.
Commission and any person, other than from interested persons. Specifically, proposed paragraph (k) to
those that may be withheld from the I. Self-Regulatory Organization’s Rule 20.6 would provide that any
public in accordance with the Statement of the Terms of the Substance transaction that arises out of a
provisions of 5 U.S.C. 552, will be of the Proposed Rule Change ‘‘verifiable systems disruption or
available for Web site viewing and malfunction’’ in the use or operation of
printing in the Commission’s Public The Exchange proposes to amend
Rule 20.6, Nullification and Adjustment an Exchange automated quotation,
Reference Room, 100 F Street NE., dissemination, execution, or
Washington, DC 20549, on official of Options Transactions including
Obvious Errors, to adopt a new communication system may either be
business days between the hours of nullified or adjusted by an Official.
10:00 a.m. and 3:00 p.m. Copies of the provision to account for erroneous
trades occurring from disruptions and/ Under the proposed paragraph (k), an
filing also will be available for Official may act, on his or her own
inspection and copying at the principal or malfunctions of Exchange systems.
The proposed rule change is based on motion, to review erroneous
office of the Exchange. All comments transactions. The proposed rule change
received will be posted without change; the rules of NYSE Arca, Inc. (‘‘NYSE
Arca’’) and the International Securities is based on the rules of NYSE Arca and
the Commission does not edit personal the ISE.7
identifying information from Exchange, LLC (‘‘ISE’’).5 Therefore, the
Exchange has designated this proposal According to the proposal, in the
submissions. You should submit only event of any verifiable disruption or
information that you wish to make as non-controversial and provided the
Commission with the notice required by malfunction in the use or operation of
available publicly. All submissions an Exchange automated quotation,
should refer to File Number SR–CBOE– Rule 19b–4(f)(6)(iii) under the Act.6 The
text of the proposed rule change is dissemination, execution, or
2015–032 and should be submitted on communication system, in which the
or before May 4, 2015. available at the Exchange’s Web site at
www.batstrading.com, at the principal nullification or modification of
For the Commission, by the Division of
office of the Exchange, and at the transactions may be necessary to
Trading and Markets, pursuant to delegated maintain a fair and orderly market or
authority.10 Commission’s Public Reference Room.
the protection of investors and the
Brent J. Fields, II. Self-Regulatory Organization’s public interest exists, an Official, on his
Secretary. Statement of the Purpose of, and or her own motion, may review such
[FR Doc. 2015–08379 Filed 4–10–15; 8:45 am] Statutory Basis for, the Proposed Rule transactions and declare the
BILLING CODE 8011–01–P Change transactions occurring during such
In its filing with the Commission, the period null and void or adjust the price
Exchange included statements of those transaction to their Theoretical
SECURITIES AND EXCHANGE concerning the purpose of and basis for Price, as defined in paragraph (b) of
COMMISSION the proposed rule change and discussed Rule 20.6. Pursuant to the proposal, an
any comments it received on the Official, absent extraordinary
[Release No. 34–74666; File No. SR–BATS– proposed rule change. The text of these circumstances, must initiate action
2015–26] statements may be examined at the under this authority within sixty (60)
places specified in Item IV below. The minutes of the occurrence of the
Self-Regulatory Organizations; BATS erroneous transaction that was a result
Exchange, Inc.; Notice of Filing and 1 15 U.S.C. 78s(b)(1). of a verifiable disruption or
Immediate Effectiveness of a Proposed 2 17 CFR 240.19b–4. malfunction.
Rule Change to Rule 20.6 To Adopt a 3 15 U.S.C. 78s(b)(3)(A). Each Options Member involved in the
New Provision To Account for 4 17 CFR 240.19b–4(f)(6)(iii).
transaction shall be notified as soon as
5 See ISE Rule 720A and NYSE Arca Rule 6.89.
Erroneous Trades Occurring From practicable, and any Options Member
See also Securities Exchange Act Release No. 72490
mstockstill on DSK4VPTVN1PROD with NOTICES
Disruptions and/or Malfunctions of (June 27, 2014), 79 FR 38105 (July 3, 2014) (SR–
aggrieved by the action may appeal such
Exchange Systems ISE–2014–34) (Notice of Filing and Immediate action in accordance with the
Effectiveness of Proposed Rule Change to Establish provisions of proposed renumbered
April 7, 2015. New Rule 720A). The proposed rule change is also paragraph (l) of Rule 20.6. Current
Pursuant to Section 19(b)(1) of the based in part on Nasdaq OMX PHLX, LLC (‘‘PHLX’’)
Rule 1092(c)(ii)(A), and in addition, is substantially
subparagraph (k), which sets for the
Securities Exchange Act of 1934 (the similar to Chicago Board Options Exchange, Inc. appeals process of decisions made by an
(‘‘CBOE’’) Rule 6.25(a)(3).
10 17 CFR 200.30–3(a)(12). 6 17 CFR 240.19b–4(f)(6)(iii). 7 See supra note 5.
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![19708 Federal Register / Vol. 80, No. 70 / Monday, April 13, 2015 / Notices
Official 8 pursuant to Rule 20.6, would and to remove impediments to and III. Date of Effectiveness of the
be renumbered as paragraph (l) and perfect the mechanism of a free and Proposed Rule Change and Timing for
cross references to current paragraph (k) open market and a national market Commission Action
within Rule 20.6 would be updated to system. Because the proposed rule change
reference renumbered paragraph (l) does not (i) significantly affect the
The Exchange believes the proposed
accordingly. protection of investors or the public
The Exchange notes that the rule change would remove impediments
to and perfect the mechanism of a free interest; (ii) impose any significant
Commission recently approved
and open market and national market burden on competition; and (iii) become
amendments to Rule 20.6 9 and that
system and promote a fair and orderly operative for 30 days from the date on
other options markets are to file
market because it would provide which it was filed, or such shorter time
proposed rule changes with the
authority to the Exchange to nullify or as the Commission may designate if
Commission to harmonize their
adjust trades that may have resulted consistent with the protection of
respective obvious and catastrophic
from a verifiable systems disruption or investors and the public interest, the
error rules with Rule 20.6. The
proposed rule change has become
Exchange understands that the malfunction. The Exchange believes that
effective pursuant to Section 19(b)(3)(A)
provision it proposes to add to Rule 20.6 it is appropriate to provide the
of the Act 12 and Rule 19b–4(f)(6)(iii)
herein is to be retained by other options flexibility and authority provided for in
exchanges as part of their harmonized thereunder.13
the proposed rule change so as not to At any time within 60 days of the
rules. Therefore, the Exchange believes limit the Exchange’s ability to plan for filing of the proposed rule change, the
it is critical to its ability to maintain fair and respond to unforeseen systems Commission summarily may
and orderly markets and to protect problems or malfunctions that may temporarily suspend such rule change if
investors to propose to add this result in harm to the public. Allowing it appears to the Commission that such
provision to its rules. for the nullification or modification of
The Exchange believes it is action is necessary or appropriate in the
transactions that result from verifiable public interest, for the protection of
appropriate to provide the flexibility
and authority provided for in proposed disruptions and/or malfunctions of investors, or otherwise in furtherance of
paragraph (k) to Rule 20.6 so as not to Exchange systems will offer market the purposes of the Act. If the
limit the Exchange’s ability to plan for participants on the Exchange a level of Commission takes such action, the
and respond to unforeseen problems relief not presently available. The Commission shall institute proceedings
and malfunctions. The proposed rule Exchange further notes that when acting to determine whether the proposed rule
change would provide the Exchange under its own motion of nullify or should be approved or disapproved.
with the same authority to nullify or adjust trades pursuant to proposed IV. Solicitation of Comments
adjust trades in the event of a ‘‘verifiable paragraph (k) of Rule 20.6, the Exchange
must consider whether taking such Interested persons are invited to
disruption or malfunction’’ in the use or
submit written data, views, and
operation of its systems as other action would be in the interest of
arguments concerning the foregoing,
exchanges have.10 For this reason, the maintaining a fair and orderly market
Exchange believes that, in the interest of including whether the proposed rule
and for the protection of investors. The change is consistent with the Act.
maintaining a fair and orderly market Exchange also notes that proposed rule
and for the protection of investors, Comments may be submitted by any of
change is based on the rules of other the following methods:
authority to nullify or adjust trades in exchanges.
these circumstances, consistent with the Electronic Comments
authority on other exchanges, is B. Self-Regulatory Organization’s
• Use the Commission’s Internet
warranted. Statement on Burden on Competition
comment form (http://www.sec.gov/
2. Statutory Basis The Exchange does not believe that rules/sro.shtml); or
The Exchange believes that the the proposed rule change will impose • Send an email to rule-comments@
proposed rule change is consistent with any burden on competition that is not sec.gov. Please include File Number SR–
Section 6(b)(5) of the Act,11 which necessary or appropriate in furtherance BATS–2015–26 on the subject line.
requires, among other things, that the of the purposes of the Act. Rather, the Paper Comments
Exchange’s rules be designed to prevent Exchange believes the proposed rule • Send paper comments in triplicate
fraudulent and manipulative acts and change will enhance competition to Brent J. Fields, Secretary, Securities
practices, to promote just and equitable because it will align the Exchange’s and Exchange Commission, 100 F Street
principles of trade, to foster cooperation rules with the rules of other markets, NE., Washington, DC 20549–1090.
and coordination with persons engaged including CBOE, NYSE Arca, the ISE,
in facilitating transactions in securities, All submissions should refer to File
and PHLX. By adopting paragraph (k) to Number SR–BATS–2015–26. This file
8 An Official is defined under current Rule
Rule 20.6 the Exchange will be in a number should be included on the
20.6(d) as ‘‘[a]n Officer of the Exchange or such position to treat transactions that are the subject line if email is used. To help the
other employee designee of the Exchange that is result of a verifiable systems disruption Commission process and review your
trained in the application of this rule [20.6].’’ or malfunction in a manner similar to comments more efficiently, please use
9 See Securities Exchange Act. Release No. 74556
(March 20, 2015) (SR–BATS–2014–067). The
other exchanges. only one method. The Commission will
Exchange notes that a comment letter received in
mstockstill on DSK4VPTVN1PROD with NOTICES
response to the proposed rule change suggesting
C. Self-Regulatory Organization’s 12 15 U.S.C. 78s(b)(3)(A).
that the Exchange also include a rule provision Statement on Comments on the 13 17 CFR 240.19b–4(f)(6)(iii). As required under
covering verifiable disruptions or malfunctions of Proposed Rule Change Received From Rule 19b–4(f)(6)(iii), the Exchange provided the
Exchange systems as proposed herein. See letter Commission with written notice of its intent to file
from Joanna Fields, Principal, Aplomb Strategies
Members, Participants, or Others
the proposed rule change, along with a brief
Inc. to Brent Fields, Secretary, Commission, dated description and the text of the proposed rule
March 23, 2015. The Exchange has neither solicited
change, at least five business days prior to the date
10 See supra note 5. nor received written comments on the of filing of the proposed rule change, or such
11 15 U.S.C. 78f(b)(5). proposed rule change. shorter time as designated by the Commission.
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![Federal Register / Vol. 80, No. 70 / Monday, April 13, 2015 / Notices 19709
post all comments on the Commission’s distributions of long-term capital gains investment goal is long-term capital
Internet Web site (http://www.sec.gov/ with respect to their outstanding growth, which it seeks to achieve by
rules/sro.shtml). Copies of the common stock as frequently as monthly investing in equity securities and non-
submission, all subsequent in any one taxable year, and as convertible fixed income securities.
amendments, all written statements frequently as distributions are specified Shares of the common stock of the
with respect to the proposed rule by or in accordance with the terms of Existing Fund are listed and traded on
change that are filed with the any outstanding preferred stock that the NASDAQ Global Select Market. The
Commission, and all written such investment companies may issue. Existing Fund had issued preferred
communications relating to the Filing Date: The application was filed stock all of which was redeemed on
proposed rule change between the on March 27, 2015. November 15, 2012. Applicants believe
Commission and any person, other than Hearing or Notification of Hearing: An that investors in closed-end funds may
those that may be withheld from the order granting the application will be prefer an investment vehicle that
public in accordance with the issued unless the Commission orders a provides regular current income through
provisions of 5 U.S.C. 552, will be hearing. Interested persons may request fixed distribution policies that would be
available for Web site viewing and a hearing by writing to the available through a Distribution Policy
printing in the Commission’s Public Commission’s Secretary and serving (as defined below).
Reference Room, 100 F Street NE., applicants with a copy of the request, 2. Sprott Asset, a limited partnership
Washington, DC 20549 on official personally or by mail. Hearing requests organized under the laws of Canada, is
business days between the hours of should be received by the Commission registered under the Investment
10:00 a.m. and 3:00 p.m. Copies of such by 5:30 p.m. on May 1, 2015 and should Advisers Act of 1940 (the ‘‘Advisers
filing also will be available for be accompanied by proof of service on Act’’) as an investment adviser. Sprott
inspection and copying at the principal applicants, in the form of an affidavit or, Asset provides investment advisory
office of the Exchange. All comments for lawyers, a certificate of service. services to the Existing Fund. Each
received will be posted without change; Pursuant to rule 0–5 under the Act, Adviser to a Fund will be registered as
the Commission does not edit personal hearing requests should state the nature an investment adviser under the
identifying information from of the writer’s interest, any facts bearing Advisers Act. Sprott Asset has engaged
submissions. You should submit only upon the desirability of a hearing on the Sprott Asset Management USA Inc.,
information that you wish to make matter, the reason for the request, and which is registered as an investment
available publicly. All submissions the issues contested. Persons who wish adviser under the Advisers Act, as sub-
should refer to File Number SR–BATS– to be notified of a hearing may request adviser for the Existing Fund.
2015–26, and should be submitted on or notification by writing to the 3. Pursuant to a prior order,2 the
before May 4, 2015. Commission’s Secretary. Existing Fund has established a periodic
ADDRESSES: Secretary, U.S. Securities payout policy of paying quarterly
For the Commission, by the Division of
and Exchange Commission, 100 F Street distributions on its common stock.3 To
Trading and Markets, pursuant to delegated
authority.14 NE., Washington, DC 20549–1090; maintain certainty for the distribution
Applicants, Bibb L. Strench, Esq., policy of the Existing Fund and the
Brent J. Fields,
Seward & Kissel LLP, 901 K Street NW., distribution policies that other Funds
Secretary.
Washington, DC 20001. may adopt in the future (each, a
[FR Doc. 2015–08337 Filed 4–10–15; 8:45 am] ‘‘Distribution Policy’’), applicants
FOR FURTHER INFORMATION CONTACT:
BILLING CODE 8011–01–P
Mark N. Zaruba, Senior Counsel, at request an order to permit each Fund to
(202) 551–6878, or Mary Kay Frech, make periodic distributions that include
Branch Chief, at (202) 551–6821 long-term capital gains as frequently as
SECURITIES AND EXCHANGE 12 times in any one taxable year in
COMMISSION (Division of Investment Management,
Chief Counsel’s Office). respect of its common stock and as often
[Investment Company Act Release No. as specified by, or determined in
SUPPLEMENTARY INFORMATION: The
31548; File No. 812–14437] accordance with the terms of, any
following is a summary of the
preferred stock issued.
Sprott Focus Trust, Inc. and Sprott application. The complete application 4. Applicants state that prior to a
Asset Management LP; Notice of may be obtained via the Commission’s Fund’s implementing a Distribution
Application Web site by searching for the file Policy in reliance on the requested
number, or for an applicant using the order, the board of directors (the
April 7, 2015. Company name box, at http:// ‘‘Board’’) of such Fund, including a
AGENCY: Securities and Exchange www.sec.gov/search/search.htm, or by
Commission (‘‘Commission’’). calling (202) 551–8090. entity, including Sprott Asset, the ‘‘Adviser’’) that
ACTION: Notice of an application under Applicants’ Representations in the future seeks to rely on the order (such
section 6(c) of the Investment Company investment companies, together with the Existing
Act of 1940 (‘‘Act’’) for an exemption 1. The Existing Fund is a Maryland Fund, are collectively, the ‘‘Funds’’ and
corporation registered under the Act as individually, a ‘‘Fund’’). Any Fund that may rely
from section 19(b) of the Act and rule on the order in the future will comply with the
19b–1 under the Act. a closed-end management investment terms and conditions of the application. A
company.1 The Existing Fund’s successor in interest is limited to entities that result
Applicants: Sprott Focus Trust, Inc. from a reorganization into another jurisdiction or a
1 The only existing registered closed-end change in the type of business organization.
mstockstill on DSK4VPTVN1PROD with NOTICES
(the ‘‘Existing Fund’’) and Sprott Asset 2 Royce Focus Trust, Inc., et al., Investment
investment company that currently intends to rely
Management LP (‘‘Sprott Asset’’). on the order has been named as an applicant. Company Act Release Nos. 30447 (April 4, 2013)
Summary of Application: Applicants Applicants request that the order also apply to each (notice) and 30499 (April 30, 2013) (order). The
request an order to permit certain other registered closed-end investment company Existing Fund is seeking the requested order
advised or to be advised in the future by Sprott because it may no longer rely on this prior order
registered closed-end investment as a result of the change of its investment adviser
Asset or by an entity controlling, controlled by, or
companies to make periodic under common control (within the meaning of from Royce & Associates, LLC to Sprott Asset.
section 2(a)(9) of the Act) with Sprott Asset 3 The Existing Fund currently has no outstanding
14 17 CFR 200.30–3(a)(12). (including any successor in interest) (each such preferred stock.
VerDate Sep<11>2014 18:02 Apr 10, 2015 Jkt 235001 PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 E:\FR\FM\13APN1.SGM 13APN1](https://thefederalregister.org/doc/80_FR_19777/page/3.svg)
Document Created: 2015-12-18 11:22:20
Document Modified: 2015-12-18 11:22:20
| 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 19707 |
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