80_FR_51060 80 FR 50898 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Verifiable Disruption or Malfunction of Exchange Systems

80 FR 50898 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Verifiable Disruption or Malfunction of Exchange Systems

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 162 (August 21, 2015)

Page Range50898-50900
FR Document2015-20656

Federal Register, Volume 80 Issue 162 (Friday, August 21, 2015)
[Federal Register Volume 80, Number 162 (Friday, August 21, 2015)]
[Notices]
[Pages 50898-50900]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-20656]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75715; File No. SR-NASDAQ-2015-100]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating to Verifiable Disruption or Malfunction of Exchange Systems

 August 17, 2015.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given 
that on August 13, 2015, The NASDAQ Stock Market LLC (``NASDAQ'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I, II, and III, below, which Items have been prepared by NASDAQ. 
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

    NASDAQ is filing with the Commission a proposal to amend chapter V, 
section 6 (Nullification and Adjustment of Options Transactions 
including Obvious Errors) of the rules of the NASDAQ Options Market 
(``NOM'') related to a verifiable disruption or malfunction of Exchange 
systems.
    The text of the amended Exchange rule is set forth immediately 
below.
    Proposed new language is italicized and proposed deleted language 
is [bracketed].

NASDAQ Stock Market Rules

Options Rules
* * * * *
Chapter V Regulation of Trading on NOM
* * * * *
Sec. 6 Nullification and Adjustment of Options Transactions Including 
Obvious Errors

    The Exchange may nullify a transaction or adjust the execution 
price of a transaction in accordance with this Rule. However, the 
determination as to whether a trade was executed at an erroneous price 
may be made by mutual agreement of the affected parties to a particular 
transaction. A trade may be nullified or adjusted on the terms that all 
parties to a particular transaction agree, provided, however, that such 
agreement to nullify or adjust must be conveyed to the Exchange in a 
manner prescribed by the Exchange prior to 8:30 a.m. Eastern Time on 
the first trading day following the execution. It is considered conduct 
inconsistent with just and equitable principles of trade for any 
Participant to use the mutual adjustment process to circumvent any 
applicable Exchange rule, the Act or any of the rules and regulations 
thereunder.
    (a)-(j) No Change.
    (k) Verifiable Disruption or Malfunction of Exchange Systems. 
Parties to a trade may have a trade nullified or its price adjusted if 
it resulted from a verifiable disruption or malfunction of Exchange 
execution, dissemination, or communication systems that caused a quote/
order to trade in excess of its disseminated size (e.g. a quote/order 
that is frozen, because of an Exchange system error, and repeatedly 
traded). Parties to a trade may have a trade nullified or its price 
adjusted if it resulted from a verifiable disruption or malfunction of 
an Exchange dissemination or communication system that prevented a 
member from updating or canceling a quote/order for which the member is 
responsible where there is Exchange documentation providing that the 
member sought to update or cancel the quote/order.
    ([k]l) Appeals. A party to a transaction affected by a decision 
made under this section may appeal that decision to the Nasdaq Review 
Council. An appeal must be made in writing, and must be

[[Page 50899]]

received by Nasdaq within thirty (30) minutes after the person making 
the appeal is given the notification of the determination being 
appealed. The Nasdaq Review Council may review any decision appealed, 
including whether a complaint was timely, whether an Obvious Error or 
Catastrophic Error occurred, whether the correct Theoretical Price was 
used, and whether an adjustment was made at the correct price.
* * * * *
    The text of the proposed rule change is available from NASDAQ's Web 
site at http://nasdaq.cchwallstreet.com, at NASDAQ's principal office, 
and at the Commission's Public Reference Room.

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

    In its filing with the Commission, NASDAQ 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. NASDAQ 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 Exchange is seeking to amend its rules related to obvious 
errors. Specifically, the Exchange is seeking to amend NOM chapter V, 
section 6 to add new section 6(k) and provide the Exchange the ability 
to nullify or adjust transactions arising out of a verifiable 
disruption or malfunction of Exchange systems.
    Similar to NASDAQ OMX PHLX LLC (``Phlx'') Rule 1092(k), proposed 
NOM chapter V, section 6(k) would indicate that parties to a trade may 
have a trade nullified or its price adjusted if it resulted from a 
verifiable disruption or malfunction of Exchange execution, 
dissemination, or communication systems that caused a quote/order to 
trade in excess of its disseminated size (e.g. a quote/order that is 
frozen, because of an Exchange system error, and repeatedly traded).\3\ 
Parties to a trade may have a trade nullified or its price adjusted if 
it resulted from a verifiable disruption or malfunction of an Exchange 
dissemination or communication system that prevented a member from 
updating or canceling a quote/order for which the member is responsible 
where there is Exchange documentation providing that the member sought 
to update or cancel the quote/order. The Exchange notes that the 
proposed NOM chapter V, section 6(k) language is identical to that of 
Phlx Rule 1092(k). Per NOM chapter V, section 6, transactions that 
qualify for price adjustment will be adjusted to Theoretical Price, as 
defined in paragraph (b) of section 6.
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    \3\ There is no reference to open outcry as NOM is all-
electronic.
---------------------------------------------------------------------------

    The Exchange believes that it is appropriate to provide the 
flexibility and authority provided for in the proposed rule so as not 
to limit the Exchange's ability to plan for and respond to unforeseen 
systems problems or malfunctions. The proposed rule change would 
provide the Exchange with the same authority that Phlx and other 
exchanges have to nullify or adjust trades in the event of a 
``verifiable disruption or malfunction'' in the use or operation of its 
systems.\4\ 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.
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    \4\ See, e.g., Phlx Rule 1092(k), Chicago Board Options Exchange 
(``CBOE'') Rule 6.25.05, CBOE C2 (``C2'') Rule 6.15.06, and NYSE 
Arca, Inc. (``Arca'') Rule 6.89.
---------------------------------------------------------------------------

    By way of housekeeping, the Exchange proposes to renumber current 
section 6(k) of NOM chapter V to section 6(l). There are no other 
changes to section 6(l), which deals with appeals regarding decisions 
pursuant to NOM chapter V, section 6.
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.\5\ Specifically, the Exchange believes the proposed rule change is 
consistent with the section 6(b)(5) \6\ 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) requirement that the rules of an 
exchange not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    In particular, the Exchange believes that 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 for 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 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 the Exchange's systems will offer market participants 
on NOM a level of relief presently not available. The Exchange notes 
that the proposed rule change is the same as the equivalent Phlx rule 
and substantially similar to the equivalent CBOE, C2, and Arca rules.

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. To the contrary, the Exchange 
believes that the proposed rule change is pro-competitive because it 
will align the NOM rules with the rules of other markets, including 
Phlx, CBOE, C2, and Arca. By adopting the proposed rule, the Exchange 
will be in a position to treat transactions that are a result of a 
verifiable systems issue 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

    Written comments were neither solicited nor received.

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

    Because the foregoing proposed rule change does not: (i) 
Significantly affect

[[Page 50900]]

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, it has become effective pursuant to section 
19(b)(3)(A) \7\ of the Act and subparagraph (f)(6) of Rule 19b-4 
thereunder.\8\
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    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: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) 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 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-NASDAQ-2015-100 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-NASDAQ-2015-100. 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 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-NASDAQ-2015-100, and should 
be submitted on or before September 11, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-20656 Filed 8-20-15; 8:45 am]
BILLING CODE 8011-01-P



                                               50898                           Federal Register / Vol. 80, No. 162 / Friday, August 21, 2015 / Notices

                                               Commission may designate if consistent                     public in accordance with the                         the NASDAQ Options Market (‘‘NOM’’)
                                               with the protection of investors and the                   provisions of 5 U.S.C. 552, will be                   related to a verifiable disruption or
                                               public interest; provided that the self-                   available for Web site viewing and                    malfunction of Exchange systems.
                                               regulatory organization has given the                      printing in the Commission’s Public                      The text of the amended Exchange
                                               Commission written notice of its intent                    Reference Room, 100 F Street NE.,                     rule is set forth immediately below.
                                               to file the proposed rule change, along                    Washington, DC 20549, on official                        Proposed new language is italicized
                                               with a brief description and text of the                   business days between the hours of                    and proposed deleted language is
                                               proposed rule change, at least five                        10:00 a.m. and 3:00 p.m. Copies of such               [bracketed].
                                               business days prior to the date of filing                  filing will also be available for                     NASDAQ Stock Market Rules
                                               of the proposed rule change, or such                       inspection and copying at the principal               Options Rules
                                               shorter time as designated by the                          office of the Exchange. All comments                  *      *     *     *    *
                                               Commission.16                                              received will be posted without change;               Chapter V Regulation of Trading on
                                                  At any time within 60 days of the                       the Commission does not edit personal                 NOM
                                               filing of the proposed rule change, the                    identifying information from
                                               Commission summarily may                                                                                         *      *     *     *    *
                                                                                                          submissions. You should submit only
                                                                                                                                                                Sec. 6 Nullification and Adjustment of
                                               temporarily suspend such rule change if                    information that you wish to make
                                                                                                                                                                Options Transactions Including Obvious
                                               it appears to the Commission that such                     available publicly. All submissions
                                                                                                                                                                Errors
                                               action is: (i) Necessary or appropriate in                 should refer to File No. SR– EDGX–
                                               the public interest; (ii) for the protection               2015–36 and should be submitted on or                    The Exchange may nullify a
                                               of investors; or (iii) otherwise in                        before September 11, 2015.                            transaction or adjust the execution price
                                               furtherance of the purposes of the Act.                                                                          of a transaction in accordance with this
                                                                                                            For the Commission, by the Division of              Rule. However, the determination as to
                                               If the Commission takes such action, the                   Trading and Markets, pursuant to delegated
                                               Commission shall institute proceedings                     authority.17
                                                                                                                                                                whether a trade was executed at an
                                               to determine whether the proposed rule                                                                           erroneous price may be made by mutual
                                                                                                          Robert W. Errett,
                                               should be approved or disapproved.                                                                               agreement of the affected parties to a
                                                                                                          Deputy Secretary.
                                                                                                                                                                particular transaction. A trade may be
                                               IV. Solicitation of Comments                               [FR Doc. 2015–20655 Filed 8–20–15; 8:45 am]           nullified or adjusted on the terms that
                                                                                                          BILLING CODE 8011–01–P                                all parties to a particular transaction
                                                 Interested persons are invited to
                                               submit written data, views and                                                                                   agree, provided, however, that such
                                               arguments concerning the foregoing,                                                                              agreement to nullify or adjust must be
                                                                                                          SECURITIES AND EXCHANGE                               conveyed to the Exchange in a manner
                                               including whether the proposal is                          COMMISSION
                                               consistent with the Act. Comments may                                                                            prescribed by the Exchange prior to 8:30
                                               be submitted by any of the following                       [Release No. 34–75715; File No. SR–                   a.m. Eastern Time on the first trading
                                               methods:                                                   NASDAQ–2015–100]                                      day following the execution. It is
                                                                                                                                                                considered conduct inconsistent with
                                               Electronic Comments                                        Self-Regulatory Organizations; The                    just and equitable principles of trade for
                                                 • Use the Commission’s Internet                          NASDAQ Stock Market LLC; Notice of                    any Participant to use the mutual
                                               comment form (http://www.sec.gov/                          Filing and Immediate Effectiveness of                 adjustment process to circumvent any
                                               rules/sro.shtml); or                                       a Proposed Rule Change Relating to                    applicable Exchange rule, the Act or any
                                                 • Send an email to rule-comments@                        Verifiable Disruption or Malfunction of               of the rules and regulations thereunder.
                                               sec.gov. Please include File No. SR–                       Exchange Systems                                         (a)–(j) No Change.
                                               EDGX–2015–36 on the subject line.                          August 17, 2015.                                         (k) Verifiable Disruption or
                                                                                                             Pursuant to section 19(b)(1) of the                Malfunction of Exchange Systems.
                                               Paper Comments
                                                                                                          Securities Exchange Act of 1934                       Parties to a trade may have a trade
                                                  • Send paper comments in triplicate                                                                           nullified or its price adjusted if it
                                                                                                          (‘‘Act’’),1 and Rule 19b–4 2 thereunder,
                                               to Secretary, Securities and Exchange                                                                            resulted from a verifiable disruption or
                                                                                                          notice is hereby given that on August
                                               Commission, 100 F Street NE.,                                                                                    malfunction of Exchange execution,
                                                                                                          13, 2015, The NASDAQ Stock Market
                                               Washington, DC 20549–1090.                                                                                       dissemination, or communication
                                                                                                          LLC (‘‘NASDAQ’’ or ‘‘Exchange’’) filed
                                               All submissions should refer to File No.                   with the Securities and Exchange                      systems that caused a quote/order to
                                               SR–EDGX–2015–36. This file number                          Commission (‘‘SEC’’ or ‘‘Commission’’)                trade in excess of its disseminated size
                                               should be included on the subject line                     the proposed rule change as described                 (e.g. a quote/order that is frozen,
                                               if email is used. To help the                              in Items I, II, and III, below, which Items           because of an Exchange system error,
                                               Commission process and review your                         have been prepared by NASDAQ. The                     and repeatedly traded). Parties to a
                                               comments more efficiently, please use                      Commission is publishing this notice to               trade may have a trade nullified or its
                                               only one method. The Commission will                       solicit comments on the proposed rule                 price adjusted if it resulted from a
                                               post all comments on the Commission’s                      change from interested persons.                       verifiable disruption or malfunction of
                                               Internet Web site (http://www.sec.gov/                                                                           an Exchange dissemination or
                                               rules/sro.shtml). Copies of the                            I. Self-Regulatory Organization’s                     communication system that prevented a
                                               submission, all subsequent                                 Statement of the Terms of Substance of                member from updating or canceling a
                                               amendments, all written statements                         the Proposed Rule Change                              quote/order for which the member is
                                               with respect to the proposed rule                             NASDAQ is filing with the                          responsible where there is Exchange
                                               change that are filed with the                             Commission a proposal to amend                        documentation providing that the
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                                               Commission, and all written                                chapter V, section 6 (Nullification and               member sought to update or cancel the
                                               communications relating to the                             Adjustment of Options Transactions                    quote/order.
                                               proposed rule change between the                           including Obvious Errors) of the rules of                ([k]l) Appeals. A party to a transaction
                                               Commission and any person, other than                                                                            affected by a decision made under this
                                               those that may be withheld from the                          17 17 CFR 200.30–3(a)(12).                          section may appeal that decision to the
                                                                                                            1 15 U.S.C. 78s(b)(1).                              Nasdaq Review Council. An appeal
                                                 16 The   Exchange has fulfilled this requirement.          2 17 CFR 240.19b–4.                                 must be made in writing, and must be


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                                                                             Federal Register / Vol. 80, No. 162 / Friday, August 21, 2015 / Notices                                              50899

                                               received by Nasdaq within thirty (30)                   verifiable disruption or malfunction of                 and perfect the mechanism of a free and
                                               minutes after the person making the                     an Exchange dissemination or                            open market and a national market
                                               appeal is given the notification of the                 communication system that prevented a                   system, and, in general, to protect
                                               determination being appealed. The                       member from updating or canceling a                     investors and the public interest.
                                               Nasdaq Review Council may review any                    quote/order for which the member is                     Additionally, the Exchange believes the
                                               decision appealed, including whether a                  responsible where there is Exchange                     proposed rule change is consistent with
                                               complaint was timely, whether an                        documentation providing that the                        the section 6(b)(5) requirement that the
                                               Obvious Error or Catastrophic Error                     member sought to update or cancel the                   rules of an exchange not be designed to
                                               occurred, whether the correct                           quote/order. The Exchange notes that                    permit unfair discrimination between
                                               Theoretical Price was used, and whether                 the proposed NOM chapter V, section                     customers, issuers, brokers, or dealers.
                                               an adjustment was made at the correct                   6(k) language is identical to that of Phlx                 In particular, the Exchange believes
                                               price.                                                  Rule 1092(k). Per NOM chapter V,                        that the proposed rule change would
                                               *     *     *     *    *                                section 6, transactions that qualify for                remove impediments to and perfect the
                                                  The text of the proposed rule change                 price adjustment will be adjusted to                    mechanism of a free and open market
                                               is available from NASDAQ’s Web site at                  Theoretical Price, as defined in                        and national market system and
                                               http://nasdaq.cchwallstreet.com, at                     paragraph (b) of section 6.                             promote a fair and orderly market
                                               NASDAQ’s principal office, and at the                      The Exchange believes that it is                     because it would provide authority for
                                               Commission’s Public Reference Room.                     appropriate to provide the flexibility                  the Exchange to nullify or adjust trades
                                                                                                       and authority provided for in the                       that may have resulted from a verifiable
                                               II. Self-Regulatory Organization’s                      proposed rule so as not to limit the                    systems disruption or malfunction. The
                                               Statement of the Purpose of, and                        Exchange’s ability to plan for and                      Exchange believes that it is appropriate
                                               Statutory Basis for, the Proposed Rule                  respond to unforeseen systems problems                  to provide the flexibility and authority
                                               Change                                                  or malfunctions. The proposed rule                      provided for in the proposed rule so as
                                                 In its filing with the Commission,                    change would provide the Exchange                       not to limit the Exchange’s ability to
                                               NASDAQ included statements                              with the same authority that Phlx and                   plan for and respond to unforeseen
                                               concerning the purpose of and basis for                 other exchanges have to nullify or adjust               systems problems or malfunctions that
                                               the proposed rule change and discussed                  trades in the event of a ‘‘verifiable                   may result in harm to the public.
                                               any comments it received on the                         disruption or malfunction’’ in the use or               Allowing for the nullification or
                                               proposed rule change. The text of these                 operation of its systems.4 For this                     modification of transactions that result
                                                                                                       reason, the Exchange believes that, in                  from verifiable disruptions and/or
                                               statements may be examined at the
                                                                                                       the interest of maintaining a fair and                  malfunctions of the Exchange’s systems
                                               places specified in Item IV below.
                                                                                                       orderly market and for the protection of                will offer market participants on NOM
                                               NASDAQ has prepared summaries, set
                                                                                                       investors, authority to nullify or adjust               a level of relief presently not available.
                                               forth in sections A, B, and C below, of
                                                                                                       trades in these circumstances,                          The Exchange notes that the proposed
                                               the most significant aspects of such
                                                                                                       consistent with the authority on other                  rule change is the same as the
                                               statements.
                                                                                                       exchanges, is warranted.                                equivalent Phlx rule and substantially
                                               A. Self-Regulatory Organization’s                          By way of housekeeping, the                          similar to the equivalent CBOE, C2, and
                                               Statement of the Purpose of, and                        Exchange proposes to renumber current                   Arca rules.
                                               Statutory Basis for, the Proposed Rule                  section 6(k) of NOM chapter V to
                                               Change                                                  section 6(l). There are no other changes                B. Self-Regulatory Organization’s
                                                                                                       to section 6(l), which deals with appeals               Statement on Burden on Competition
                                               1. Purpose                                              regarding decisions pursuant to NOM                       The Exchange does not believe that
                                                  The Exchange is seeking to amend its                 chapter V, section 6.                                   the proposed rule change will impose
                                               rules related to obvious errors.                        2. Statutory Basis                                      any burden on competition not
                                               Specifically, the Exchange is seeking to                                                                        necessary or appropriate in furtherance
                                               amend NOM chapter V, section 6 to add                      The Exchange believes the proposed                   of the purposes of the Act. To the
                                               new section 6(k) and provide the                        rule change is consistent with the Act                  contrary, the Exchange believes that the
                                               Exchange the ability to nullify or adjust               and the rules and regulations                           proposed rule change is pro-competitive
                                               transactions arising out of a verifiable                thereunder applicable to the Exchange                   because it will align the NOM rules with
                                               disruption or malfunction of Exchange                   and, in particular, the requirements of                 the rules of other markets, including
                                               systems.                                                section 6(b) of the Act.5 Specifically, the             Phlx, CBOE, C2, and Arca. By adopting
                                                  Similar to NASDAQ OMX PHLX LLC                       Exchange believes the proposed rule                     the proposed rule, the Exchange will be
                                               (‘‘Phlx’’) Rule 1092(k), proposed NOM                   change is consistent with the section                   in a position to treat transactions that
                                               chapter V, section 6(k) would indicate                  6(b)(5) 6 requirements that the rules of                are a result of a verifiable systems issue
                                               that parties to a trade may have a trade                an exchange be designed to prevent                      or malfunction in a manner similar to
                                               nullified or its price adjusted if it                   fraudulent and manipulative acts and
                                                                                                                                                               other exchanges.
                                               resulted from a verifiable disruption or                practices, to promote just and equitable
                                               malfunction of Exchange execution,                      principles of trade, to foster cooperation              C. Self-Regulatory Organization’s
                                               dissemination, or communication                         and coordination with persons engaged                   Statement on Comments on the
                                               systems that caused a quote/order to                    in regulating, clearing, settling,                      Proposed Rule Change Received From
                                               trade in excess of its disseminated size                processing information with respect to,                 Members, Participants, or Others
                                               (e.g. a quote/order that is frozen,                     and facilitating transactions in                          Written comments were neither
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                                               because of an Exchange system error,                    securities, to remove impediments to                    solicited nor received.
                                               and repeatedly traded).3 Parties to a                      4 See, e.g., Phlx Rule 1092(k), Chicago Board        III. Date of Effectiveness of the
                                               trade may have a trade nullified or its                 Options Exchange (‘‘CBOE’’) Rule 6.25.05, CBOE C2       Proposed Rule Change and Timing for
                                               price adjusted if it resulted from a                    (‘‘C2’’) Rule 6.15.06, and NYSE Arca, Inc. (‘‘Arca’’)   Commission Action
                                                                                                       Rule 6.89.
                                                  3 There is no reference to open outcry as NOM is        5 15 U.S.C. 78f(b).                                     Because the foregoing proposed rule
                                               all-electronic.                                            6 15 U.S.C. 78f(b)(5).                               change does not: (i) Significantly affect


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                                               50900                           Federal Register / Vol. 80, No. 162 / Friday, August 21, 2015 / Notices

                                               the protection of investors or the public                 provisions of 5 U.S.C. 552, will be                   I. Self-Regulatory Organization’s
                                               interest; (ii) impose any significant                     available for Web site viewing and                    Statement of the Terms of Substance of
                                               burden on competition; and (iii) become                   printing in the Commission’s Public                   the Proposed Rule Change
                                               operative for 30 days from the date on                    Reference Room, 100 F Street NE.,
                                                                                                                                                                  The Exchange filed a proposal to
                                               which it was filed, or such shorter time                  Washington, DC 20549 on official
                                                                                                                                                               amend Rule 11.22 to describe a market
                                               as the Commission may designate, it has                   business days between the hours of
                                                                                                                                                               data product known as BZX Book
                                               become effective pursuant to section                      10:00 a.m. and 3:00 p.m. Copies of such
                                                                                                                                                               Viewer.
                                               19(b)(3)(A) 7 of the Act and                              filing also will be available for
                                                                                                                                                                  The text of the proposed rule change
                                               subparagraph (f)(6) of Rule 19b–4                         inspection and copying at the principal
                                                                                                                                                               is available at the Exchange’s Web site
                                               thereunder.8                                              office of the Exchange. All comments
                                                  At any time within 60 days of the                                                                            at www.batstrading.com, at the
                                                                                                         received will be posted without change;
                                               filing of the proposed rule change, the                                                                         principal office of the Exchange, and at
                                                                                                         the Commission does not edit personal
                                               Commission summarily may                                                                                        the Commission’s Public Reference
                                                                                                         identifying information from
                                               temporarily suspend such rule change if                                                                         Room.
                                                                                                         submissions. You should submit only
                                               it appears to the Commission that such                    information that you wish to make                     II. Self-Regulatory Organization’s
                                               action is: (i) Necessary or appropriate in                available publicly. All submissions                   Statement of the Purpose of, and
                                               the public interest; (ii) for the protection              should refer to File Number SR–                       Statutory Basis for, the Proposed Rule
                                               of investors; or (iii) otherwise in                       NASDAQ–2015–100, and should be                        Change
                                               furtherance of the purposes of the Act.                   submitted on or before September 11,
                                                                                                                                                                 In its filing with the Commission, the
                                               If the Commission takes such action, the                  2015.
                                                                                                                                                               Exchange included statements
                                               Commission shall institute proceedings                      For the Commission, by the Division of              concerning the purpose of and basis for
                                               to determine whether the proposed rule                    Trading and Markets, pursuant to delegated            the proposed rule change and discussed
                                               should be approved or disapproved.                        authority.9                                           any comments it received on the
                                               IV. Solicitation of Comments                              Robert W. Errett,                                     proposed rule change. The text of these
                                                                                                         Deputy Secretary.                                     statements may be examined at the
                                                 Interested persons are invited to
                                               submit written data, views, and                           [FR Doc. 2015–20656 Filed 8–20–15; 8:45 am]           places specified in Item IV below. The
                                               arguments concerning the foregoing,                       BILLING CODE 8011–01–P                                Exchange has prepared summaries, set
                                               including whether the proposed rule                                                                             forth in Sections A, B, and C below, of
                                               change is consistent with the Act.                                                                              the most significant parts of such
                                               Comments may be submitted by any of                       SECURITIES AND EXCHANGE                               statements.
                                               the following methods:                                    COMMISSION
                                                                                                                                                               (A) Self-Regulatory Organization’s
                                               Electronic Comments                                       [Release No. 34–75711; File No. SR–BATS–              Statement of the Purpose of, and
                                                                                                         2015–62]                                              Statutory Basis for, the Proposed Rule
                                                 • Use the Commission’s Internet                                                                               Change
                                               comment form (http://www.sec.gov/                         Self-Regulatory Organizations; BATS
                                               rules/sro.shtml); or                                      Exchange, Inc.; Notice of Filing and                  1. Purpose
                                                 • Send an email to rule-comments@                       Immediate Effectiveness of a Proposed                    The Exchange proposes to add
                                               sec.gov. Please include File Number SR–                   Rule Change To Amend Rule 11.22 To                    language to Rule 11.22 describing a
                                               NASDAQ–2015–100 on the subject line.                      Describe the Market Data Product BZX                  market data product known as BZX
                                               Paper Comments                                            Book Viewer                                           Book Viewer. The proposal
                                                  • Send paper comments in triplicate                                                                          memorializes in the Exchange’s rules a
                                                                                                         August 17, 2015.
                                               to Brent J. Fields, Secretary, Securities                                                                       data feed that is currently available
                                                                                                            Pursuant to Section 19(b)(1) of the                through the Exchange’s public Web site
                                               and Exchange Commission, 100 F Street                     Securities Exchange Act of 1934 (the
                                               NE., Washington, DC 20549–1090.                                                                                 free of charge. BZX Book Viewer is a
                                                                                                         ‘‘Act’’),1 and Rule 19b–4 thereunder,2                data feed that disseminates, on a real-
                                               All submissions should refer to File                      notice is hereby given that on August 7,
                                               Number SR–NASDAQ–2015–100. This                                                                                 time basis, the aggregated two-side
                                                                                                         2015, BATS Exchange, Inc. (the                        quotations for up to five (5) price levels
                                               file number should be included on the                     ‘‘Exchange’’ or ‘‘BATS’’) filed with the
                                               subject line if email is used. To help the                                                                      for all displayed orders for securities
                                                                                                         Securities and Exchange Commission                    traded on the Exchange and for which
                                               Commission process and review your                        (‘‘Commission’’) the proposed rule
                                               comments more efficiently, please use                                                                           the Exchanges reports quotes under the
                                                                                                         change as described in Items I and II                 Consolidated Tape Association (‘‘CTA’’)
                                               only one method. The Commission will                      below, which Items have been prepared
                                               post all comments on the Commission’s                                                                           Plan or the Nasdaq/UTP Plan. BZX Book
                                                                                                         by the Exchange. The Exchange has                     Viewer also contains the last ten (10)
                                               Internet Web site (http://www.sec.gov/                    designated this proposal as a ‘‘non-
                                               rules/sro.shtml). Copies of the                                                                                 trades including time of trade, price and
                                                                                                         controversial’’ proposed rule change                  share quantity. BZX Book Viewer is
                                               submission, all subsequent                                pursuant to Section 19(b)(3)(A) of the
                                               amendments, all written statements                                                                              currently available via
                                                                                                         Act 3 and Rule 19b–4(f)(6)(iii)                       www.batstrading.com without charge.
                                               with respect to the proposed rule                         thereunder,4 which renders it effective
                                               change that are filed with the                                                                                  The Exchange will file a separate
                                                                                                         upon filing with the Commission. The                  proposed rule change with the
                                               Commission, and all written                               Commission is publishing this notice to
                                               communications relating to the                                                                                  Commission proposing fees to be
                                                                                                         solicit comments on the proposed rule
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                                               proposed rule change between the                                                                                charged for certain types of access to
                                                                                                         change from interested persons.                       BZX Book Viewer as of September 1,
                                               Commission and any person, other than
                                               those that may be withheld from the                                                                             2015.5
                                                                                                           9 17 CFR 200.30–3(a)(12).
                                               public in accordance with the                               1 15 U.S.C. 78s(b)(1).                                5 The Exchange understands that its affiliated
                                                                                                           2 17 CFR 240.19b–4.
                                                                                                                                                               exchanges intend to file identical proposed rule
                                                 7 15   U.S.C. 78s(b)(3)(A).                               3 15 U.S.C. 78s(b)(3)(A).
                                                                                                                                                               changes to adopt rules and fees for the Book Viewer
                                                 8 17   CFR 240.19b–4(f)(6).                               4 17 CFR 240.19b–4(f)(6)(iii).                      data feed with the Commission. The Exchange’s



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Document Created: 2018-02-23 11:00:49
Document Modified: 2018-02-23 11:00:49
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation80 FR 50898 

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