80 FR 30506 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Delay Implementation of Rule 15.2A

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 102 (May 28, 2015)

Page Range		30506-30508
FR Document		2015-12833

Federal Register, Volume 80 Issue 102 (Thursday, May 28, 2015)

[Federal Register Volume 80, Number 102 (Thursday, May 28, 2015)]
[Notices]
[Pages 30506-30508]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2015-12833]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75029; File No. SR-CBOE-2015-051]

Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Delay Implementation of Rule 15.2A

May 21, 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 May 20, 2015, Chicago Board Options Exchange, Incorporated (the
``Exchange'' or ``CBOE'') filed with the Securities and Exchange
Commission (the ``Commission'') the proposed rule change as described
in Items I, II, and III below, which Items have been prepared by the
Exchange. The Exchange filed the proposal as a ``non-controversial''
proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act
\3\ and Rule 19b-4(f)(6) thereunder.\4\ 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.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

The Exchange proposes to delay the implementation of Rule 15.2A.
There is no proposed change to the rule text.

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
On August 13, 2014, the Commission approved CBOE Rules 6.53(y) and
15.2A.\5\ Rule 6.53(y) defines a tied to stock order \6\ and requires
the representing Trading Permit Holder to include an indicator on each
tied to stock order upon systemization, subject to certain exceptions.
Rule 15.2A requires, in a manner and form prescribed by the Exchange,
each Trading Permit Holder (``TPH''), on the business day following the
order execution date, to report to the Exchange certain information
regarding the executed stock or convertible security legs of qualified
contingent cross (``QCC'') orders,\7\ stock-option

[[Page 30507]]

orders and other tied to stock orders that the TPH executed on the
Exchange that trading day. The Exchange stated in rule filing SR-CBOE-
2014-040 that it would issue a circular announcing the implementation
date for these rules within 90 days of the date of filing, which
implementation date would be within 180 days of the date of filing.
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\5\ Securities Exchange Act Release No. 72839 (August 13, 2014),
79 FR 49123 (August 19, 2014) (SR-CBOE-2014-040) (order approving
Rules 6.53(y) and 15.2A).
\6\ Rule 6.53(y) provides that an order is ``tied to stock'' if,
at the time the Trading Permit Holder representing the order on the
Exchange receives the order (if the order is a customer order) or
initiates the order (if the order is a is a proprietary order), has
knowledge that the order is coupled with an order(s) for the
underlying stock or a security convertible into the underlying stock
(``convertible security'' and, together with underlying stock,
``non-option'').
\7\ A QCC order is an order to buy (sell) at least 1,000
standard option contracts or 10,000 mini-option contracts that is
identified as being part of a qualified contingent trade coupled
with a contra-side order to sell (buy) an equal number of contracts.
These orders may only be entered in the standard increments
applicable to simple orders in the options class under Rule 6.42.
For purposes of this order type, a ``qualified contingent trade'' is
a transaction consisting of two or more component orders, executed
as agent or principal, where: (a) At least one component is an NMS
stock, as defined in Rule 600 of Regulation NMS under the Act; (b)
all components are effected with a product or price contingency that
either has been agreed to by all the respective counterparties or
arranged for by a broker-dealer as principal or agent; (c) the
execution of one component is contingent upon the execution of all
other components at or near the same time; (d) the specific
relationship between the component orders (e.g., the spread between
the prices of the component orders) is determined by the time the
contingent order is placed; (e) the component orders bear a
derivative relationship to one another, represent different classes
of shares of the same issuer, or involve the securities of
participants in mergers or with intentions to merge that have been
announced or cancelled; and (f) the transaction is fully hedged
(without regard to any prior existing position) as a result of other
components of the contingent trade. QCC orders may execute without
exposure provided the execution is not at the same price as a public
customer order resting in the electronic book and is at or between
the national best bid or offer. A QCC order will be cancelled if it
cannot be executed. See Rule 6.53(u). The Exchange notes that it
deactivated the QCC functionality effective August 11, 2014 and will
announce any reactivation of QCC functionality by Regulatory
Circular. See Regulatory Circular RG14-121.
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On January 7, 2015, CBOE submitted a rule filing to delay the
implementation of these rules based on feedback it received from
TPHs.\8\ The Exchange stated in that rule filing that it would issue a
circular announcing the implementation date for the rules within 90
days of the date of the rule filing, which implementation date would be
within 180 days of the date of filing. In accordance with that filing,
the Exchange recently issued a regulatory circular on April 7, 2015,
which announced a July 1, 2015 implementation date for the tied to
stock marking and reporting requirements.\9\
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\8\ Securities Exchange Act Release No. 74067 (January 15,
2015), 80 FR 3267 (January 22, 2015) (SR-CBOE-2015-004) (notice of
immediate effectiveness of rule filing).
\9\ CBOE Regulatory Circular RG15-056 (April 7, 2015).
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While the Exchange believes there has been sufficient training and
circulars provided to Trading Permit Holders on the marking requirement
to move forward with implementation of that requirement on July 1,
2015, the Exchange believes it is appropriate to delay the
implementation of the reporting requirement. Therefore, the Exchange
proposes to further delay the implementation date of the tied to stock
reporting requirement for tied to stock orders.\10\ During this time,
the Exchange plans to evaluate the information obtained via the marking
requirement under Rule 6.53(y) in conjunction with information
available through other sources and further consider the reporting
requirement format. In that regard, the Exchange notes that CBOE
recently entered into a Regulatory Services Agreement with the
Financial Industry Regulatory Authority, Inc. (``FINRA''). As a result,
CBOE plans to evaluate the format of the reports with FINRA to ensure
that the information to be provided in the reports can be incorporated
into surveillances in an efficient and effective manner.\11\ Therefore,
the Exchange seeks to extend the implementation date of Rule 15.2A
until the Exchange can conclude whether or not this additional
information is necessary in order to enhance its ability to effectively
monitor and conduct surveillance of the CBOE markets with respect to
orders that are tied to stock whose execution information is not
electronically captured by the audit trail.\12\
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\10\ Pursuant to Regulatory Circular RG13-102, CBOE imposed a
reporting requirement with respect to QCC orders prior to the
adoption of Rule 15.2A. Once the Exchange implements Rule 15.2A, the
reporting requirement in that rule will supersede the current QCC
order reporting requirement described in that circular. As noted
above, QCC functionality is currently not active. However, if the
Exchange reactivates the functionality prior to implementation of
Rule 15.2A, then the reporting requirement for QCC orders described
in Regulatory Circular RG13-102 will continue to be in effect until
the implementation of Rule 15.2A.
\11\ During this delay, CBOE intends to review the number of
tied to stock orders for which information regarding the stock or
convertible security leg is not available from CBOE's internal data,
which will permit CBOE to evaluate the number of reports it can
expect to receive and the potential impact of the reports on CBOE's
surveillances.
\12\ The Exchange notes that Rule 15.2A, Interpretation .03
provides that a Market-Maker (or its clearing firm) may include the
information required by Rule 15.2A in the equity reported submitted
to CBOE pursuant to Rule 8.9(b). Because the proposed rule change is
delaying the implementation of Rule 15.2A, Market-Makers (or their
clearing firms) will continue to submit reports pursuant to Rule
8.9(b) in the same manner they do today.
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The Exchange expects its evaluation to be completed and to
implement the reporting requirement within 12 to 18 months of the date
of this filing. This will provide CBOE with sufficient time to conduct
this evaluation and TPHs with sufficient time to implement any
potential changes to the reporting requirement format. The Exchange
will issue a regulatory circular announcing the new implementation date
for the reporting requirement as least 90 days prior to that date.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\13\ Specifically, the Exchange believes the proposed rule change
is consistent with the Section 6(b)(5) \14\ requirements that the rules
of an exchange 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 regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, 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.
Additionally, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \15\ requirement that the rules of
an exchange not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
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\13\ 15 U.S.C. 78f(b).
\14\ 15 U.S.C. 78f(b)(5).
\15\ Id.
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In particular, the Exchange believes the delayed implementation of
Rule 15.2A will provide the Exchange with sufficient time to evaluate
the information obtained through the marking requirement and the
related reporting requirement format to ensure that the Exchange
receives reports from TPHs in a manner that can be incorporated into
surveillance systems in an efficient and effective manner. This will
ultimately improve the Exchange's ability to tie executed non-option
legs to the applicable option legs that were separately submitted for
execution, which will assist in the Exchange's efforts to prevent
fraudulent and manipulative acts and practices with respect to tied to
stock orders.

B. Self-Regulatory Organization's Statement on Burden on Competition

CBOE 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 change does not
impose any burden on competition, as it is simply seeking to delay the
implementation of the tied to stock reporting requirement.

[[Page 30508]]

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

The Exchange neither solicited nor received comments on the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

Because the foregoing proposed rule change does not:
A. significantly affect the protection of investors or the public
interest;
B. impose any significant burden on competition; and
C. become operative for 30 days from the date on which it was
filed, or such shorter time as the Commission may designate, it has
become effective pursuant to Section 19(b)(3)(A) of the Act \16\ and
Rule 19b-4(f)(6) \17\ thereunder. 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 will institute proceedings to determine whether the proposed
rule change should be approved or disapproved.
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\16\ 15 U.S.C. 78s(b)(3)(A).
\17\ 17 CFR 240.19b-4(f)(6).
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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 Comments

Use 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-CBOE-2015-051 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-CBOE-2015-051. 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 the 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-CBOE-2015-051 and should be
submitted on or before June 18, 2015.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-12833 Filed 5-27-15; 8:45 am]
BILLING CODE 8011-01-P

30506 Federal Register / Vol. 80, No. 102 / Thursday, May 28, 2015 / Notices

(C) Clearing Agency’s Statement on Commission and any person, other than publishing this notice to solicit
Comments on the Proposed Rule those that may be withheld from the comments on the proposed rule change
Change Received From Members, public in accordance with the from interested persons.
Participants, or Others provisions of 5 U.S.C. 552, will be
I. Self-Regulatory Organization’s
Written comments relating to the available for Web site viewing and
printing in the Commission’s Public Statement of the Terms of Substance of
proposed rule change have not yet been the Proposed Rule Change
solicited or received. DTC will notify Reference Room, 100 F Street NE.,
the Commission of any written Washington, DC 20549 on official The Exchange proposes to delay the
comments received by DTC. business days between the hours of implementation of Rule 15.2A. There is
10:00 a.m. and 3:00 p.m. Copies of the no proposed change to the rule text.
III. Date of Effectiveness of the filing also will be available for
Proposed Rule Change, and Timing for II. Self-Regulatory Organization’s
inspection and copying at the principal
Commission Action Statement of the Purpose of, and
office of DTC and on DTCC’s Web site.
Statutory Basis for, the Proposed Rule
The foregoing rule change has become (http://dtcc.com/legal/sec-rule-
Change
effective pursuant to Section filings.aspx). All comments received
19(b)(3)(A) 8 of the Act and paragraph (f) will be posted without change; the In its filing with the Commission, the
of Rule 19b–4 9 thereunder. At any time Commission does not edit personal Exchange included statements
within 60 days of the filing of the identifying information from concerning the purpose of and basis for
proposed rule change, the Commission submissions. You should submit only the proposed rule change and discussed
summarily may temporarily suspend information that you wish to make any comments it received on the
such rule change if it appears to the available publicly. All submissions proposed rule change. The text of these
Commission that such action is should refer to File Number SR–DTC– statements may be examined at the
necessary or appropriate in the public 2015–006 and should be submitted on places specified in Item IV below. The
interest, for the protection of investors, or before June 18, 2015. Exchange has prepared summaries, set
or otherwise in furtherance of the For the Commission, by the Division of forth in sections A, B, and C below, of
purposes of the Act. Trading and Markets, pursuant to delegated the most significant aspects of such
authority.10 statements.
IV. Solicitation of Comments
Robert W. Errett, A. Self-Regulatory Organization’s
Interested persons are invited to Deputy Secretary. Statement of the Purpose of, and
submit written data, views and [FR Doc. 2015–12834 Filed 5–27–15; 8:45 am] Statutory Basis for, the Proposed Rule
arguments concerning the foregoing, BILLING CODE 8011–01–P Change
including whether the proposed rule
change is consistent with the Act. 1. Purpose
Comments may be submitted by any of SECURITIES AND EXCHANGE On August 13, 2014, the Commission
the following methods: COMMISSION approved CBOE Rules 6.53(y) and
Electronic Comments [Release No. 34–75029; File No. SR–CBOE– 15.2A.5 Rule 6.53(y) defines a tied to
• Use the Commission’s Internet 2015–051] stock order 6 and requires the
comment form (http://www.sec.gov/ representing Trading Permit Holder to
Self-Regulatory Organizations; include an indicator on each tied to
rules/sro.shtml); or
• Send an email to rule-comments@ Chicago Board Options Exchange, stock order upon systemization, subject
sec.gov. Please include File Number SR– Incorporated; Notice of Filing and to certain exceptions. Rule 15.2A
DTC–2015–006 on the subject line. Immediate Effectiveness of a Proposed requires, in a manner and form
Rule Change To Delay Implementation prescribed by the Exchange, each
Paper Comments of Rule 15.2A Trading Permit Holder (‘‘TPH’’), on the
• Send paper comments in triplicate May 21, 2015.
business day following the order
to Brent J. Fields, Secretary, Securities execution date, to report to the
Pursuant to Section 19(b)(1) of the Exchange certain information regarding
and Exchange Commission, 100 F Street Securities Exchange Act of 1934 (the
NE., Washington, DC 20549–1090. the executed stock or convertible
‘‘Act’’),1 and Rule 19b–4 thereunder,2 security legs of qualified contingent
All submissions should refer to File notice is hereby given that on May 20,
Number SR–DTC–2015–006. This file cross (‘‘QCC’’) orders,7 stock-option
2015, Chicago Board Options Exchange,
number should be included on the Incorporated (the ‘‘Exchange’’ or 5 Securities Exchange Act Release No. 72839
subject line if email is used. To help the ‘‘CBOE’’) filed with the Securities and (August 13, 2014), 79 FR 49123 (August 19, 2014)
Commission process and review your Exchange Commission (the (SR–CBOE–2014–040) (order approving Rules
comments more efficiently, please use ‘‘Commission’’) the proposed rule 6.53(y) and 15.2A).
only one method. The Commission will change as described in Items I, II, and
6 Rule 6.53(y) provides that an order is ‘‘tied to

post all comments on the Commission’s stock’’ if, at the time the Trading Permit Holder
III below, which Items have been representing the order on the Exchange receives the
Internet Web site (http://www.sec.gov/ prepared by the Exchange. The order (if the order is a customer order) or initiates
rules/sro.shtml). Copies of the Exchange filed the proposal as a ‘‘non- the order (if the order is a is a proprietary order),
submission, all subsequent controversial’’ proposed rule change has knowledge that the order is coupled with an
order(s) for the underlying stock or a security
asabaliauskas on DSK5VPTVN1PROD with NOTICES

amendments, all written statements pursuant to Section 19(b)(3)(A)(iii) of convertible into the underlying stock (‘‘convertible
with respect to the proposed rule the Act 3 and Rule 19b–4(f)(6) security’’ and, together with underlying stock,
change that are filed with the thereunder.4 The Commission is ‘‘non-option’’).
Commission, and all written 7 A QCC order is an order to buy (sell) at least

communications relating to the 10 17 1,000 standard option contracts or 10,000 mini-
CFR 200.30–3(a)(12).
option contracts that is identified as being part of
proposed rule change between the 1 15 U.S.C. 78s(b)(1). a qualified contingent trade coupled with a contra-
2 17 CFR 240.19b–4.
side order to sell (buy) an equal number of
8 15 U.S.C. 78s(b)(3)(A). 3 15 U.S.C. 78s(b)(3)(A)(iii).
contracts. These orders may only be entered in the
9 17 CFR 240.19b–4(f). 4 17 CFR 240.19b–4(f)(6). standard increments applicable to simple orders in

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Federal Register / Vol. 80, No. 102 / Thursday, May 28, 2015 / Notices 30507

orders and other tied to stock orders that Exchange proposes to further delay the reporting requirement as least 90 days
the TPH executed on the Exchange that implementation date of the tied to stock prior to that date.
trading day. The Exchange stated in rule reporting requirement for tied to stock
filing SR–CBOE–2014–040 that it would orders.10 During this time, the Exchange 2. Statutory Basis
issue a circular announcing the plans to evaluate the information The Exchange believes the proposed
implementation date for these rules obtained via the marking requirement rule change is consistent with the Act
within 90 days of the date of filing, under Rule 6.53(y) in conjunction with and the rules and regulations
which implementation date would be information available through other thereunder applicable to the Exchange
within 180 days of the date of filing. sources and further consider the and, in particular, the requirements of
On January 7, 2015, CBOE submitted reporting requirement format. In that Section 6(b) of the Act.13 Specifically,
a rule filing to delay the implementation regard, the Exchange notes that CBOE
the Exchange believes the proposed rule
of these rules based on feedback it recently entered into a Regulatory
change is consistent with the Section
received from TPHs.8 The Exchange Services Agreement with the Financial
6(b)(5) 14 requirements that the rules of
stated in that rule filing that it would Industry Regulatory Authority, Inc.
an exchange be designed to prevent
issue a circular announcing the (‘‘FINRA’’). As a result, CBOE plans to
evaluate the format of the reports with fraudulent and manipulative acts and
implementation date for the rules
FINRA to ensure that the information to practices, to promote just and equitable
within 90 days of the date of the rule
be provided in the reports can be principles of trade, to foster cooperation
filing, which implementation date
incorporated into surveillances in an and coordination with persons engaged
would be within 180 days of the date of
efficient and effective manner.11 in regulating, clearing, settling,
filing. In accordance with that filing, the
Therefore, the Exchange seeks to extend processing information with respect to,
Exchange recently issued a regulatory
the implementation date of Rule 15.2A and facilitating transactions in
circular on April 7, 2015, which
announced a July 1, 2015 until the Exchange can conclude securities, to remove impediments to
implementation date for the tied to whether or not this additional and perfect the mechanism of a free and
stock marking and reporting information is necessary in order to open market and a national market
requirements.9 enhance its ability to effectively monitor system, and, in general, to protect
While the Exchange believes there has and conduct surveillance of the CBOE investors and the public interest.
been sufficient training and circulars markets with respect to orders that are Additionally, the Exchange believes the
provided to Trading Permit Holders on tied to stock whose execution proposed rule change is consistent with
the marking requirement to move information is not electronically the Section 6(b)(5) 15 requirement that
forward with implementation of that captured by the audit trail.12 the rules of an exchange not be designed
requirement on July 1, 2015, the The Exchange expects its evaluation to permit unfair discrimination between
Exchange believes it is appropriate to to be completed and to implement the customers, issuers, brokers, or dealers.
delay the implementation of the reporting requirement within 12 to 18 In particular, the Exchange believes
reporting requirement. Therefore, the months of the date of this filing. This the delayed implementation of Rule
will provide CBOE with sufficient time 15.2A will provide the Exchange with
the options class under Rule 6.42. For purposes of to conduct this evaluation and TPHs sufficient time to evaluate the
this order type, a ‘‘qualified contingent trade’’ is a with sufficient time to implement any information obtained through the
transaction consisting of two or more component potential changes to the reporting
orders, executed as agent or principal, where: (a) At marking requirement and the related
requirement format. The Exchange will reporting requirement format to ensure
least one component is an NMS stock, as defined
in Rule 600 of Regulation NMS under the Act; (b) issue a regulatory circular announcing that the Exchange receives reports from
all components are effected with a product or price the new implementation date for the
contingency that either has been agreed to by all the
TPHs in a manner that can be
respective counterparties or arranged for by a 10 Pursuant to Regulatory Circular RG13–102,
incorporated into surveillance systems
broker-dealer as principal or agent; (c) the execution CBOE imposed a reporting requirement with in an efficient and effective manner.
of one component is contingent upon the execution respect to QCC orders prior to the adoption of Rule This will ultimately improve the
of all other components at or near the same time; 15.2A. Once the Exchange implements Rule 15.2A,
(d) the specific relationship between the component
Exchange’s ability to tie executed non-
the reporting requirement in that rule will
orders (e.g., the spread between the prices of the supersede the current QCC order reporting
option legs to the applicable option legs
component orders) is determined by the time the requirement described in that circular. As noted that were separately submitted for
contingent order is placed; (e) the component above, QCC functionality is currently not active. execution, which will assist in the
orders bear a derivative relationship to one another, However, if the Exchange reactivates the
represent different classes of shares of the same
Exchange’s efforts to prevent fraudulent
functionality prior to implementation of Rule
issuer, or involve the securities of participants in 15.2A, then the reporting requirement for QCC
and manipulative acts and practices
mergers or with intentions to merge that have been orders described in Regulatory Circular RG13–102 with respect to tied to stock orders.
announced or cancelled; and (f) the transaction is will continue to be in effect until the
fully hedged (without regard to any prior existing implementation of Rule 15.2A. B. Self-Regulatory Organization’s
position) as a result of other components of the 11 During this delay, CBOE intends to review the Statement on Burden on Competition
contingent trade. QCC orders may execute without number of tied to stock orders for which
exposure provided the execution is not at the same information regarding the stock or convertible CBOE does not believe that the
price as a public customer order resting in the security leg is not available from CBOE’s internal
electronic book and is at or between the national proposed rule change will impose any
data, which will permit CBOE to evaluate the
best bid or offer. A QCC order will be cancelled if number of reports it can expect to receive and the burden on competition that is not
it cannot be executed. See Rule 6.53(u). The potential impact of the reports on CBOE’s necessary or appropriate in furtherance
Exchange notes that it deactivated the QCC
asabaliauskas on DSK5VPTVN1PROD with NOTICES

surveillances. of the purposes of the Act. The
functionality effective August 11, 2014 and will 12 The Exchange notes that Rule 15.2A,
announce any reactivation of QCC functionality by proposed change does not impose any
Interpretation .03 provides that a Market-Maker (or
Regulatory Circular. See Regulatory Circular RG14– its clearing firm) may include the information burden on competition, as it is simply
121. required by Rule 15.2A in the equity reported seeking to delay the implementation of
8 Securities Exchange Act Release No. 74067
submitted to CBOE pursuant to Rule 8.9(b). Because the tied to stock reporting requirement.
(January 15, 2015), 80 FR 3267 (January 22, 2015) the proposed rule change is delaying the
(SR–CBOE–2015–004) (notice of immediate implementation of Rule 15.2A, Market-Makers (or
13 15 U.S.C. 78f(b).
effectiveness of rule filing). their clearing firms) will continue to submit reports
9 CBOE Regulatory Circular RG15–056 (April 7, 14 15 U.S.C. 78f(b)(5).
pursuant to Rule 8.9(b) in the same manner they do
2015). today. 15 Id.

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30508 Federal Register / Vol. 80, No. 102 / Thursday, May 28, 2015 / Notices

C. Self-Regulatory Organization’s only one method. The Commission will thereunder,3 a proposed rule change to
Statement on Comments on the post all comments on the Commission’s list and trade shares (‘‘Shares’’) of the
Proposed Rule Change Received From Internet Web site (http://www.sec.gov/ Tuttle Tactical Management Multi-
Members, Participants, or Others rules/sro.shtml). Copies of the Strategy Income ETF (‘‘Fund’’), a series
The Exchange neither solicited nor submission, all subsequent of ETFis Series Trust I (‘‘Trust’’) under
received comments on the proposed amendments, all written statements NASDAQ Rule 5735. The proposed rule
rule change. with respect to the proposed rule change was published for comment in
change that are filed with the the Federal Register on April 10, 2015.4
III. Date of Effectiveness of the Commission, and all written On May 20, 2015, the Exchange filed
Proposed Rule Change and Timing for communications relating to the Amendment No. 1 to the proposed rule
Commission Action proposed rule change between the change.5 The Commission received no
Because the foregoing proposed rule Commission and any person, other than comments on the proposed rule change.
change does not: those that may be withheld from the This order approves the proposed rule
A. significantly affect the protection public in accordance with the change, as modified by Amendment No.
of investors or the public interest; provisions of 5 U.S.C. 552, will be 1.
B. impose any significant burden on available for Web site viewing and
II. Description of the Proposal
competition; and printing in the Commission’s Public
C. become operative for 30 days from Reference Room, 100 F Street NE., The Exchange proposes to list and
the date on which it was filed, or such Washington, DC 20549 on official trade the Shares under Nasdaq Rule
shorter time as the Commission may business days between the hours of 5735, which governs the listing and
designate, it has become effective 10:00 a.m. and 3:00 p.m. Copies of the trading of Managed Fund Shares on the
pursuant to Section 19(b)(3)(A) of the filing also will be available for Exchange. The Fund will be an actively-
Act 16 and Rule 19b–4(f)(6) 17 inspection and copying at the principal managed exchange-traded fund (‘‘ETF’’).
thereunder. At any time within 60 days office of the Exchange. All comments The Shares will be offered by the Trust.6
of the filing of the proposed rule change, received will be posted without change; The Trust is registered with the
the Commission summarily may the Commission does not edit personal Commission as an investment company
temporarily suspend such rule change if identifying information from and has filed a registration statement on
it appears to the Commission that such submissions. You should submit only Form N–1A (‘‘Registration Statement’’)
action is necessary or appropriate in the information that you wish to make with the Commission.7 The Fund is a
public interest, for the protection of available publicly. All submissions series of the Trust.
investors, or otherwise in furtherance of should refer to File Number SR–CBOE- Etfis Capital LLC will be the
the purposes of the Act. If the 2015–051 and should be submitted on investment adviser (‘‘Adviser’’) to the
Commission takes such action, the or before June 18, 2015. Fund. Tuttle Tactical Management, LLC
Commission will institute proceedings will be the investment sub-adviser
For the Commission, by the Division of
to determine whether the proposed rule Trading and Markets, pursuant to delegated (‘‘Sub-Adviser’’) to the Fund. ETF
change should be approved or authority.18 Distributors LLC will be the principal
disapproved. Robert W. Errett, underwriter and distributor of the
Deputy Secretary.
Fund’s Shares. The Bank of New York
IV. Solicitation of Comments Mellon will act as the administrator,
[FR Doc. 2015–12833 Filed 5–27–15; 8:45 am]
Interested persons are invited to accounting agent, custodian, and
BILLING CODE 8011–01–P
submit written data, views, and transfer agent to the Fund. The
arguments concerning the foregoing, Exchange states that the Adviser and
including whether the proposed rule SECURITIES AND EXCHANGE Sub-Adviser are not registered as
change is consistent with the Act. COMMISSION broker-dealers but that the Adviser is
Comments may be submitted by any of affiliated with a broker-dealer.8 In
the following methods: [Release No. 34–75031; File No. SR– addition, the Exchange states that the
NASDAQ–2015–023] Adviser has implemented a fire wall
Electronic Comments with respect to its broker-dealer affiliate
• Use the Commission’s Internet Self-Regulatory Organizations; The
regarding access to information
comment form (http://www.sec.gov/ NASDAQ Stock Market LLC; Order
concerning the composition and/or
rules/sro.shtml); or Approving a Proposed Rule Change,
changes to the portfolio, and will be
• Send an email to rule-comments@ as Modified by Amendment No. 1, To
sec.gov. Please include File Number SR– List and Trade the Shares of the Tuttle 3 17 CFR 240.19b–4.
CBOE–2015–051 on the subject line. Tactical Management Multi-Strategy 4 See Securities Exchange Act Release No. 74653
Income ETF of ETFis Series Trust I (April 6, 2015), 80 FR 19371 (‘‘Notice’’).
Paper Comments 5 In Amendment No. 1, the Exchange clarified
May 21, 2015.
• Send paper comments in triplicate that under normal market conditions, the Fund will
invest only in those assets listed under the
to Secretary, Securities and Exchange I. Introduction ‘‘Principal Investments’’ section of the Notice.
Commission, 100 F Street NE., On March 25, 2015, The NASDAQ Amendment No. 1 is not subject to notice and
Washington, DC 20549–1090. Stock Market LLC (‘‘Exchange’’ or comment because it is a technical amendment that
does not materially alter the substance of the
asabaliauskas on DSK5VPTVN1PROD with NOTICES

All submissions should refer to File ‘‘Nasdaq’’) filed with the Securities and proposed rule change or raise any novel regulatory
Number SR–CBOE-2015–051. This file Exchange Commission (‘‘Commission’’), issues.
number should be included on the pursuant to Section 19(b)(1) 1 of the 6 The Commission has issued an order granting

subject line if email is used. To help the Securities Exchange Act of 1934 (‘‘Act’’ certain exemptive relief to the Trust under the 1940
Act. See Investment Company Act Release No.
Commission process and review your or ‘‘Exchange Act’’) 2 and Rule 19b–4 30607 (July 23, 2013).
comments more efficiently, please use 7 See Registration Statement on Form N–1A for
18 17 CFR 200.30–3(a)(12). the Trust filed on January 30, 2015 (File Nos. 333–
16 15 U.S.C. 78s(b)(3)(A). 1 15 U.S.C. 78s(b)(1). 187668 and 811–22819).
17 17 CFR 240.19b–4(f)(6). 2 15 U.S.C. 78a. 8 See Notice, supra note 4, 80 FR at 19372.

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Document Created: 2018-02-21 10:33:15
Document Modified: 2018-02-21 10:33:15

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 30506