80_FR_56696 80 FR 56515 - Joint Industry Plan; Notice of Filing of the Ninth Amendment to the National Market System Plan To Address Extraordinary Market Volatility by BATS Exchange, Inc., BATS Y-Exchange, Inc., Chicago Board Options Exchange, Inc., Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, The Nasdaq Stock Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc.

80 FR 56515 - Joint Industry Plan; Notice of Filing of the Ninth Amendment to the National Market System Plan To Address Extraordinary Market Volatility by BATS Exchange, Inc., BATS Y-Exchange, Inc., Chicago Board Options Exchange, Inc., Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, The Nasdaq Stock Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc.

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 181 (September 18, 2015)

Page Range56515-56517
FR Document2015-23415

Federal Register, Volume 80 Issue 181 (Friday, September 18, 2015)
[Federal Register Volume 80, Number 181 (Friday, September 18, 2015)]
[Notices]
[Pages 56515-56517]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-23415]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75917; File No. 4-631]


Joint Industry Plan; Notice of Filing of the Ninth Amendment to 
the National Market System Plan To Address Extraordinary Market 
Volatility by BATS Exchange, Inc., BATS Y-Exchange, Inc., Chicago Board 
Options Exchange, Inc., Chicago Stock Exchange, Inc., EDGA Exchange, 
Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, 
Inc., NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, The Nasdaq Stock Market 
LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE 
MKT LLC, and NYSE Arca, Inc.

September 14, 2015.

I. Introduction

    On July 31, 2015, the New York Stock Exchange LLC (``NYSE''), on 
behalf of the following parties to the National Market System Plan to 
Address Extraordinary Market Volatility (the ``Plan''): \1\ BATS 
Exchange, Inc., BATS Y-Exchange, Inc., Chicago Board Options Exchange, 
Incorporated (``CBOE''), Chicago Stock Exchange, Inc., EDGA Exchange, 
Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, 
Inc., NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, the Nasdaq Stock Market 
LLC, and National Stock Exchange, Inc., NYSE MKT LLC, and NYSE Arca, 
Inc. (collectively with the NYSE, the ``Participants''), filed with the 
Securities and Exchange Commission (``Commission'') pursuant to Section 
11A of the Securities Exchange Act of 1934 (``Act'') \2\ and Rule 608 
thereunder,\3\ a proposal to amend the Plan.\4\ The proposal reflects 
changes unanimously approved by the Participants. The Amendment to the 
Plan proposes to extend the pilot period of the Plan from October 23, 
2015 to April 22, 2016. A copy of the Plan, as proposed to be amended 
is attached as Exhibit A hereto. The Commission is publishing this 
notice to solicit comments from interested persons on the Amendment to 
the Plan.\5\
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    \1\ On May 31, 2012, the Commission approved the Plan, as 
modified by Amendment No. 1. See Securities Exchange Act Release No. 
67091, 77 FR 33498 (Jun. 6, 2012) (File No. 4-631). On February 26, 
2013, the Commission published for immediate effectiveness the 
Second Amendment to the Plan. See Securities Exchange Act Release 
No. 68953 (Feb. 20, 2013), 78 FR 13113. On April 3, 2013, the 
Commission approved the Third Amendment to the Plan. See Securities 
Exchange Act Release No. 69287, 78 FR 21483 (Apr. 10, 2013). On 
September 3, 2013, the Commission published for immediate 
effectiveness the Fourth Amendment to the Plan. See Securities 
Exchange Act Release No. 70273 (Aug. 27, 2013), 78 FR 54321 (Fourth 
Amendment). On September 26, 2013, the Commission approved the Fifth 
Amendment to the Plan. See Securities Exchange Act Release No. 
70530, 78 FR 60937 (Oct. 2, 2013). On January 13, 2014, the 
Commission published for immediate effective the Sixth Amendment to 
the Plan. See Securities Exchange Act Release No. 71247 (Jan. 7, 
2014), 79 FR 2204 (Sixth Amendment). On April 3, 2014, the 
Commission approved the Seventh Amendment to the Plan. See 
Securities Exchange Act Release No. 71851, 79 FR 19687 (Apr. 9, 
2014). On February 19, 2015, the Commission approved the Eight 
Amendment to the Plan. See Securities Exchange Act Release No. 
74323, 80 FR 10169 (Feb. 25, 2015).
    \2\ 15 U.S.C. 78k-1.
    \3\ 17 CFR 242.608.
    \4\ See Letter from Elizabeth King, General Counsel, NYSE, to 
Brent Fields, Secretary, Commission, dated July 31, 2015 
(``Transmittal Letter'').
    \5\ 17 CFR 242.608.
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II. Description of the Plan

    Set forth in this Section II is the statement of the purpose and 
summary of the Amendment, along with the information required by Rule 
608(a)(4) and (5) under the Exchange Act,\6\ prepared and submitted by 
the Participants to the Commission.\7\
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    \6\ See 17 CFR 242.608(a)(4) and (a)(5).
    \7\ See Transmittal Letter, supra note 3.
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A. Statement of Purpose and Summary of the Plan Amendment

    The Participants filed the Plan on April 5, 2011, to create a 
market-wide limit up-limit down mechanism intended to address 
extraordinary market volatility in NMS Stocks, as defined in Rule 
600(b)(47) of Regulation NMS under the Exchange Act. The Plan sets 
forth procedures that provide for market-wide limit up-limit down 
requirements that would prevent trades in individual NMS Stocks from 
occurring outside of the specified price bands. These limit up-limit 
down requirements are coupled with Trading Pauses, as defined in 
Section I(Y) of the Plan, to accommodate more fundamental price moves. 
In particular, the Participants adopted this Plan to address the type 
of sudden price movements that the market experienced on the afternoon 
of May 6, 2010.
    As set forth in more detail in the Plan, all trading centers in NMS 
Stocks, including both those operated by Participants and those 
operated by members of Participants, shall establish, maintain, and 
enforce written policies and procedures that are reasonably designed to 
comply with the limit up-limit down requirements specified in the Plan. 
More specifically, the single plan processor responsible for 
consolidation of information for an NMS Stock pursuant to Rule 603(b) 
of Regulation NMS under the Exchange Act will be responsible for 
calculating

[[Page 56516]]

and disseminating a lower price band and upper price band, as provided 
for in Section V of the Plan. Section VI of the Plan sets forth the 
limit up-limit down requirements of the Plan, and in particular, that 
all trading centers in NMS Stocks, including both those operated by 
Participants and those operated by members of Participants, shall 
establish, maintain, and enforce written policies and procedures that 
are reasonably designed to prevent trades at prices that are below the 
lower price band or above the upper price band for an NMS Stock, 
consistent with the Plan.
    The Plan was initially approved for a one-year pilot period, which 
began on April 8, 2013.\8\ Accordingly, the pilot period was scheduled 
to end on April 8, 2014. As initially contemplated, the Plan would have 
been fully implemented across all NMS Stocks within six months of 
initial Plan operations, which meant there would have been full 
implementation of the Plan for six months before the end of the pilot 
period. However, pursuant to the fourth amendment to the Plan,\9\ the 
Participants modified the implementation schedule of Phase II of the 
Plan to extend the time period as to when the Plan would fully apply to 
all NMS Stocks. Accordingly, the Plan was not implemented across all 
NMS Stocks until December 8, 2013. Pursuant to the sixth amendment to 
the Plan,\10\ which further modified the implementation schedule of 
Phase II of the Plan, the date for full implementation of the Plan was 
moved to February 24, 2014.
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    \8\ See Section VIII of the Plan.
    \9\ See Fourth Amendment, supra note 1.
    \10\ See Sixth Amendment, supra note 1.
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    In addition, pursuant to the seventh amendment to the Plan,\11\ the 
pilot period was extended from April 8, 2014 to February 20, 2015, and 
submission of the assessment of the Plan operations was accordingly 
extended to September 30, 2014. Without such extension, the Plan would 
have been in effect for the full trading day for less than two months 
before the end of the pilot period. The Participants believed that this 
short period of full implementation of the Plan would have provided 
insufficient time for both the Participants and the Commission to 
assess the impact of the Plan and determine whether the Plan should be 
modified prior to approval on a permanent basis.
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    \11\ See Securities Exchange Act Release No. 71851 (April 3, 
2014), 79 FR 19687 (April 9, 2014).
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    On September 29, 2014, the Participants submitted a Participant 
Impact Assessment,\12\ which provided the Commission with the 
Participants' initial observations in each area required to be 
addressed under Appendix B to the Plan. On May 28, 2015, the 
Participants submitted a Supplemental Joint Assessment, in which the 
Participants recommended that the Plan be adopted as permanent with 
certain modifications, and discussed the areas of analysis set forth in 
Appendix B to the Plan.\13\ These areas are intended to capture the key 
measures necessary to assess the impact of the Plan and to support 
recommendations relating to the calibration of the Percentage 
Parameters to help ensure that the stated objectives of the Plan are 
achieved--particularly: Liquidity when approaching price bands; clearly 
erroneous trades; the appropriateness of the percentage parameters; the 
attributes of limit states; the impact of limit states on the options 
markets; whether process adjustments are needed when entering/exiting a 
limit state; and the length of trading pauses.
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    \12\ See Joint SROs letter to Brent J. Fields, Secretary, SEC, 
dated September 29, 2014 (``Participant Impact Assessment'').
    \13\ See Letter from Christopher B. Stone, Vice President, 
FINRA, to Brent J. Fields, Secretary, SEC, dated May 28, 2015.
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    The Participants propose to amend Section VIII(C) of the Plan to 
extend the pilot period through April 22, 2016, to allow the 
Participants to conduct, and the Commission to consider, further 
analysis of data in support of the recommendations made in the 
Supplemental Joint Assessment, including around the attributes of limit 
states; the length of trading pauses; the use of an alternative 
reference price at the open of trading; and the alignment of the 
percentage parameters with the Clearly Erroneous Execution (CEE) 
thresholds (with the goal of largely eliminating the Participants' CEE 
authority). Thus, an extension of the pilot period would allow the 
Participants to finalize and file with the Commission any proposed 
amendments to the Plan resulting from such recommendations and further 
analysis. The Participants believe that extending the pilot period is 
appropriate in the public interest, for the protection of investors and 
the maintenance of a fair and orderly market because it provides 
Participants with additional time to perform further analysis on the 
appropriateness of current Plan components and parameters, and to 
finalize and propose recommended modifications to the Plan.
    The Participants believe that the proposed amendment is consistent 
with Section 11A of the Securities Exchange Act of 1934 and Rule 608, 
of Regulation NMS thereunder,\14\ which authorizes the Participants to 
act jointly in preparing, filing and implementing national market 
system plans. The Participants further believe that extending the pilot 
period will be beneficial in that it allows ``the public, the 
Participants, and the Commission to assess the operation of the Plan 
and whether the Plan should be modified prior to approval on a 
permanent basis.'' \15\
---------------------------------------------------------------------------

    \14\ 17 CFR 242.608.
    \15\ See Securities Exchange Act Release No. 67091 (May 31, 
2012), 77 FR 33498, 33508 (June 6, 2012).
---------------------------------------------------------------------------

    The Participants note that the amended version of the Plan also 
includes the revised Appendix A--Schedule 1, which was updated for 
trading beginning July 1, 2015. As set forth in Appendix A--Percentage 
Parameters, the Primary Listing Exchange updates Schedule 1 to Appendix 
A semi-annually based on the fiscal year, and such updates do not 
require a Plan amendment.
1. Chicago Board Options Exchange, Incorporated Withdrawal
    On March 30, 2015, CBOE provided written notice to Participants of 
CBOE's intent to withdraw from the Plan. Notice of withdrawal was made 
pursuant to Section IX of the Plan.
    CBOE became a Participant due to the operation of the CBOE Stock 
Exchange, LLC (``CBSX''), a facility of the CBOE. CBSX engaged in NMS 
stock transactions. The last day of trading on CBSX was April 30, 2014. 
Because CBOE no longer operates a facility engaged in NMS stock 
transactions, CBOE would have no additional NMS stock data to provide 
nor any reason to avail itself of any further right under the Plan. 
Accordingly, CBOE proposes to be removed from the Plan.

B. Governing or Constituent Documents

    The governing documents of the Processor, as defined in Section 
I(P) of the Plan, will not be affected by the Plan, but once the Plan 
is implemented, the Processor's obligations will change, as set forth 
in detail in the Plan.

C. Implementation of Plan

    The initial date of the Plan operations was April 8, 2013.

D. Development and Implementation Phases

    The Plan was initially implemented as a one-year pilot program in 
two Phases, consistent with Section VIII of the Plan: Phase I of Plan

[[Page 56517]]

implementation began on April 8, 2013 and was completed on May 3, 2013. 
Implementation of Phase II of the Plan began on August 5, 2013 and was 
completed on February 24, 2014. Pursuant to this proposed amendment, 
the Participants propose to extend the pilot period so that it is set 
to end April 22, 2016.

E. Analysis of Impact on Competition

    The proposed amendment to the Plan does not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Exchange Act. The Participants do not believe that the 
proposed Plan introduces terms that are unreasonably discriminatory for 
the purposes of Section 11A(c)(1)(D) of the Exchange Act.

F. Written Understanding or Agreements Relating to Interpretation of, 
or Participation in the Plan

    The Participants have no written understandings or agreements 
relating to interpretation of the Plan. Section II(C) of the Plan sets 
forth how any entity registered as a national securities exchange or 
national securities association may become a Participant.

G. Approval of Amendment of the Plan

    Each of the Plan's Participants has executed a written amended 
Plan.

H. Terms and Conditions of Access

    Section II(C) of the Plan provides that any entity registered as a 
national securities exchange or national securities association under 
the Exchange Act may become a Participant by: (1) Becoming a 
participant in the applicable Market Data Plans, as defined in Section 
I(F) of the Plan; (2) executing a copy of the Plan, as then in effect; 
(3) providing each then-current Participant with a copy of such 
executed Plan; and (4) effecting an amendment to the Plan as specified 
in Section III(B) of the Plan.

I. Method of Determination and Imposition, and Amount of, Fees and 
Charges

    Not applicable.

J. Method and Frequency of Processor Evaluation

    Not applicable.

K. Dispute Resolution

    Section III(C) of the Plan provides for each Participant to 
designate an individual to represent the Participant as a member of an 
Operating Committee. No later than the initial date of the Plan, the 
Operating Committee shall designate one member of the Operating 
Committee to act as the Chair of the Operating Committee. Any 
recommendation for an amendment to the Plan from the Operating 
Committee that receives an affirmative vote of at least two-thirds of 
the Participants, but is less than unanimous, shall be submitted to the 
Commission as a request for an amendment to the Plan initiated by the 
Commission under Rule 608.
    On July 30, 2015, the Operating Committee, duly constituted and 
chaired by Ms. Karen Lorentz of the NYSE, on behalf of Committee 
Chairman Mr. Christopher B. Stone of FINRA, met and voted unanimously 
to amend the Plan as set forth herein in accordance with Section III(C) 
of the Plan. The Plan Advisory Committee was notified in connection 
with the Ninth Amendment and was in favor.

III. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed 
Ninth Amendment 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 4-631 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 4-631. 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 Plan that are filed with the Commission, 
and all written communications relating to the Plan 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 
Participants' principal offices. 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 4-631 and should be submitted on or before October 9, 2015.

    By the Commission.
Brent J. Fields,
Secretary.
[FR Doc. 2015-23415 Filed 9-17-15; 8:45 am]
BILLING CODE 8011-01-P



                                                                            Federal Register / Vol. 80, No. 181 / Friday, September 18, 2015 / Notices                                                  56515

                                                • Send an email to rule-comments@                       SECURITIES AND EXCHANGE                               1934 (‘‘Act’’) 2 and Rule 608
                                              sec.gov. Please include File Number SR–                   COMMISSION                                            thereunder,3 a proposal to amend the
                                              NASDAQ–2015–102 on the subject line.                                                                            Plan.4 The proposal reflects changes
                                                                                                        [Release No. 34–75917; File No. 4–631]
                                                                                                                                                              unanimously approved by the
                                              Paper Comments                                                                                                  Participants. The Amendment to the
                                                                                                        Joint Industry Plan; Notice of Filing of
                                                • Send paper comments in triplicate                     the Ninth Amendment to the National                   Plan proposes to extend the pilot period
                                                                                                        Market System Plan To Address                         of the Plan from October 23, 2015 to
                                              to Brent J. Fields, Secretary, Securities
                                                                                                        Extraordinary Market Volatility by                    April 22, 2016. A copy of the Plan, as
                                              and Exchange Commission, 100 F Street
                                                                                                        BATS Exchange, Inc., BATS                             proposed to be amended is attached as
                                              NE., Washington, DC 20549–1090.                                                                                 Exhibit A hereto. The Commission is
                                                                                                        Y-Exchange, Inc., Chicago Board
                                              All submissions should refer to File                      Options Exchange, Inc., Chicago Stock                 publishing this notice to solicit
                                              Number SR–NASDAQ–2015–102. This                                                                                 comments from interested persons on
                                                                                                        Exchange, Inc., EDGA Exchange, Inc.,
                                              file number should be included on the                                                                           the Amendment to the Plan.5
                                                                                                        EDGX Exchange, Inc., Financial
                                              subject line if email is used. To help the                Industry Regulatory Authority, Inc.,                  II. Description of the Plan
                                              Commission process and review your                        NASDAQ OMX BX, Inc., NASDAQ OMX                          Set forth in this Section II is the
                                              comments more efficiently, please use                     PHLX LLC, The Nasdaq Stock Market                     statement of the purpose and summary
                                              only one method. The Commission will                      LLC, National Stock Exchange, Inc.,                   of the Amendment, along with the
                                              post all comments on the Commission’s                     New York Stock Exchange LLC, NYSE                     information required by Rule 608(a)(4)
                                              Internet Web site (http://www.sec.gov/                    MKT LLC, and NYSE Arca, Inc.                          and (5) under the Exchange Act,6
                                              rules/sro.shtml). Copies of the                                                                                 prepared and submitted by the
                                                                                                        September 14, 2015.
                                              submission, all subsequent                                                                                      Participants to the Commission.7
                                              amendments, all written statements                        I. Introduction
                                              with respect to the proposed rule                                                                               A. Statement of Purpose and Summary
                                                                                                           On July 31, 2015, the New York Stock               of the Plan Amendment
                                              change that are filed with the                            Exchange LLC (‘‘NYSE’’), on behalf of
                                              Commission, and all written                               the following parties to the National                    The Participants filed the Plan on
                                              communications relating to the                                                                                  April 5, 2011, to create a market-wide
                                                                                                        Market System Plan to Address
                                              proposed rule change between the                                                                                limit up-limit down mechanism
                                                                                                        Extraordinary Market Volatility (the
                                              Commission and any person, other than                                                                           intended to address extraordinary
                                                                                                        ‘‘Plan’’): 1 BATS Exchange, Inc., BATS
                                              those that may be withheld from the                                                                             market volatility in NMS Stocks, as
                                                                                                        Y-Exchange, Inc., Chicago Board
                                              public in accordance with the                                                                                   defined in Rule 600(b)(47) of Regulation
                                                                                                        Options Exchange, Incorporated
                                                                                                                                                              NMS under the Exchange Act. The Plan
                                              provisions of 5 U.S.C. 552, will be                       (‘‘CBOE’’), Chicago Stock Exchange,
                                                                                                                                                              sets forth procedures that provide for
                                              available for Web site viewing and                        Inc., EDGA Exchange, Inc., EDGX
                                                                                                                                                              market-wide limit up-limit down
                                              printing in the Commission’s Public                       Exchange, Inc., Financial Industry
                                                                                                                                                              requirements that would prevent trades
                                              Reference Room, 100 F Street NE.,                         Regulatory Authority, Inc., NASDAQ
                                                                                                                                                              in individual NMS Stocks from
                                              Washington, DC 20549, on official                         OMX BX, Inc., NASDAQ OMX PHLX
                                                                                                                                                              occurring outside of the specified price
                                              business days between the hours of                        LLC, the Nasdaq Stock Market LLC, and                 bands. These limit up-limit down
                                              10:00 a.m. and 3:00 p.m. Copies of the                    National Stock Exchange, Inc., NYSE                   requirements are coupled with Trading
                                              filing also will be available for                         MKT LLC, and NYSE Arca, Inc.                          Pauses, as defined in Section I(Y) of the
                                              inspection and copying at the principal                   (collectively with the NYSE, the                      Plan, to accommodate more
                                              office of the Exchange. All comments                      ‘‘Participants’’), filed with the Securities          fundamental price moves. In particular,
                                              received will be posted without change;                   and Exchange Commission                               the Participants adopted this Plan to
                                              the Commission does not edit personal                     (‘‘Commission’’) pursuant to Section                  address the type of sudden price
                                                                                                        11A of the Securities Exchange Act of                 movements that the market experienced
                                              identifying information from
                                              submissions. You should submit only                          1 On May 31, 2012, the Commission approved the
                                                                                                                                                              on the afternoon of May 6, 2010.
                                              information that you wish to make                         Plan, as modified by Amendment No. 1. See
                                                                                                                                                                 As set forth in more detail in the Plan,
                                              available publicly. All submissions                       Securities Exchange Act Release No. 67091, 77 FR      all trading centers in NMS Stocks,
                                              should refer to File Number SR–                           33498 (Jun. 6, 2012) (File No. 4–631). On February    including both those operated by
                                                                                                        26, 2013, the Commission published for immediate      Participants and those operated by
                                              NASDAQ–2015–102 and should be                             effectiveness the Second Amendment to the Plan.
                                              submitted on or before October 9, 2015.                   See Securities Exchange Act Release No. 68953
                                                                                                                                                              members of Participants, shall establish,
                                                                                                        (Feb. 20, 2013), 78 FR 13113. On April 3, 2013, the   maintain, and enforce written policies
                                                For the Commission, by the Division of                  Commission approved the Third Amendment to the        and procedures that are reasonably
                                              Trading and Markets, pursuant to delegated                Plan. See Securities Exchange Act Release No.         designed to comply with the limit up-
                                              authority.13                                              69287, 78 FR 21483 (Apr. 10, 2013). On September
                                                                                                        3, 2013, the Commission published for immediate
                                                                                                                                                              limit down requirements specified in
                                              Brent J. Fields,                                          effectiveness the Fourth Amendment to the Plan.       the Plan. More specifically, the single
                                              Secretary.                                                See Securities Exchange Act Release No. 70273         plan processor responsible for
                                              [FR Doc. 2015–23396 Filed 9–17–15; 8:45 am]               (Aug. 27, 2013), 78 FR 54321 (Fourth Amendment).      consolidation of information for an
                                                                                                        On September 26, 2013, the Commission approved
                                              BILLING CODE 8011–01–P                                    the Fifth Amendment to the Plan. See Securities
                                                                                                                                                              NMS Stock pursuant to Rule 603(b) of
                                                                                                        Exchange Act Release No. 70530, 78 FR 60937 (Oct.     Regulation NMS under the Exchange
                                                                                                        2, 2013). On January 13, 2014, the Commission         Act will be responsible for calculating
                                                                                                        published for immediate effective the Sixth
                                                                                                        Amendment to the Plan. See Securities Exchange
tkelley on DSK3SPTVN1PROD with NOTICES




                                                                                                                                                                2 15 U.S.C. 78k–1.
                                                                                                        Act Release No. 71247 (Jan. 7, 2014), 79 FR 2204        3 17 CFR 242.608.
                                                                                                        (Sixth Amendment). On April 3, 2014, the                4 See Letter from Elizabeth King, General Counsel,
                                                                                                        Commission approved the Seventh Amendment to
                                                                                                        the Plan. See Securities Exchange Act Release No.     NYSE, to Brent Fields, Secretary, Commission,
                                                                                                        71851, 79 FR 19687 (Apr. 9, 2014). On February 19,    dated July 31, 2015 (‘‘Transmittal Letter’’).
                                                                                                                                                                5 17 CFR 242.608.
                                                                                                        2015, the Commission approved the Eight
                                                                                                                                                                6 See 17 CFR 242.608(a)(4) and (a)(5).
                                                                                                        Amendment to the Plan. See Securities Exchange
                                                13 17   CFR 200.30–3(a)(12).                            Act Release No. 74323, 80 FR 10169 (Feb. 25, 2015).     7 See Transmittal Letter, supra note 3.




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                                              56516                       Federal Register / Vol. 80, No. 181 / Friday, September 18, 2015 / Notices

                                              and disseminating a lower price band                    Impact Assessment,12 which provided                     Section 11A of the Securities Exchange
                                              and upper price band, as provided for                   the Commission with the Participants’                   Act of 1934 and Rule 608, of Regulation
                                              in Section V of the Plan. Section VI of                 initial observations in each area                       NMS thereunder,14 which authorizes
                                              the Plan sets forth the limit up-limit                  required to be addressed under                          the Participants to act jointly in
                                              down requirements of the Plan, and in                   Appendix B to the Plan. On May 28,                      preparing, filing and implementing
                                              particular, that all trading centers in                 2015, the Participants submitted a                      national market system plans. The
                                              NMS Stocks, including both those                        Supplemental Joint Assessment, in                       Participants further believe that
                                              operated by Participants and those                      which the Participants recommended                      extending the pilot period will be
                                              operated by members of Participants,                    that the Plan be adopted as permanent                   beneficial in that it allows ‘‘the public,
                                              shall establish, maintain, and enforce                  with certain modifications, and                         the Participants, and the Commission to
                                              written policies and procedures that are                discussed the areas of analysis set forth               assess the operation of the Plan and
                                              reasonably designed to prevent trades at                in Appendix B to the Plan.13 These                      whether the Plan should be modified
                                              prices that are below the lower price                   areas are intended to capture the key                   prior to approval on a permanent
                                              band or above the upper price band for                  measures necessary to assess the impact                 basis.’’ 15
                                              an NMS Stock, consistent with the Plan.                 of the Plan and to support                                 The Participants note that the
                                                                                                      recommendations relating to the                         amended version of the Plan also
                                                 The Plan was initially approved for a                calibration of the Percentage Parameters                includes the revised Appendix A—
                                              one-year pilot period, which began on                   to help ensure that the stated objectives               Schedule 1, which was updated for
                                              April 8, 2013.8 Accordingly, the pilot                  of the Plan are achieved—particularly:                  trading beginning July 1, 2015. As set
                                              period was scheduled to end on April                    Liquidity when approaching price                        forth in Appendix A—Percentage
                                              8, 2014. As initially contemplated, the                 bands; clearly erroneous trades; the                    Parameters, the Primary Listing
                                              Plan would have been fully                              appropriateness of the percentage                       Exchange updates Schedule 1 to
                                              implemented across all NMS Stocks                       parameters; the attributes of limit states;             Appendix A semi-annually based on the
                                              within six months of initial Plan                       the impact of limit states on the options               fiscal year, and such updates do not
                                              operations, which meant there would                     markets; whether process adjustments                    require a Plan amendment.
                                              have been full implementation of the                    are needed when entering/exiting a
                                              Plan for six months before the end of the               limit state; and the length of trading                  1. Chicago Board Options Exchange,
                                              pilot period. However, pursuant to the                  pauses.                                                 Incorporated Withdrawal
                                              fourth amendment to the Plan,9 the                         The Participants propose to amend                       On March 30, 2015, CBOE provided
                                              Participants modified the                               Section VIII(C) of the Plan to extend the               written notice to Participants of CBOE’s
                                              implementation schedule of Phase II of                  pilot period through April 22, 2016, to                 intent to withdraw from the Plan. Notice
                                              the Plan to extend the time period as to                allow the Participants to conduct, and                  of withdrawal was made pursuant to
                                              when the Plan would fully apply to all                  the Commission to consider, further                     Section IX of the Plan.
                                              NMS Stocks. Accordingly, the Plan was                   analysis of data in support of the                         CBOE became a Participant due to the
                                              not implemented across all NMS Stocks                   recommendations made in the                             operation of the CBOE Stock Exchange,
                                              until December 8, 2013. Pursuant to the                 Supplemental Joint Assessment,                          LLC (‘‘CBSX’’), a facility of the CBOE.
                                              sixth amendment to the Plan,10 which                    including around the attributes of limit                CBSX engaged in NMS stock
                                              further modified the implementation                     states; the length of trading pauses; the               transactions. The last day of trading on
                                              schedule of Phase II of the Plan, the date              use of an alternative reference price at                CBSX was April 30, 2014. Because
                                              for full implementation of the Plan was                 the open of trading; and the alignment                  CBOE no longer operates a facility
                                              moved to February 24, 2014.                             of the percentage parameters with the                   engaged in NMS stock transactions,
                                                                                                      Clearly Erroneous Execution (CEE)                       CBOE would have no additional NMS
                                                 In addition, pursuant to the seventh                 thresholds (with the goal of largely
                                              amendment to the Plan,11 the pilot                                                                              stock data to provide nor any reason to
                                                                                                      eliminating the Participants’ CEE                       avail itself of any further right under the
                                              period was extended from April 8, 2014                  authority). Thus, an extension of the
                                              to February 20, 2015, and submission of                                                                         Plan. Accordingly, CBOE proposes to be
                                                                                                      pilot period would allow the                            removed from the Plan.
                                              the assessment of the Plan operations                   Participants to finalize and file with the
                                              was accordingly extended to September                   Commission any proposed amendments                      B. Governing or Constituent Documents
                                              30, 2014. Without such extension, the                   to the Plan resulting from such
                                              Plan would have been in effect for the                                                                            The governing documents of the
                                                                                                      recommendations and further analysis.                   Processor, as defined in Section I(P) of
                                              full trading day for less than two                      The Participants believe that extending
                                              months before the end of the pilot                                                                              the Plan, will not be affected by the
                                                                                                      the pilot period is appropriate in the                  Plan, but once the Plan is implemented,
                                              period. The Participants believed that                  public interest, for the protection of
                                              this short period of full implementation                                                                        the Processor’s obligations will change,
                                                                                                      investors and the maintenance of a fair                 as set forth in detail in the Plan.
                                              of the Plan would have provided                         and orderly market because it provides
                                              insufficient time for both the                          Participants with additional time to                    C. Implementation of Plan
                                              Participants and the Commission to                      perform further analysis on the                          The initial date of the Plan operations
                                              assess the impact of the Plan and                       appropriateness of current Plan                         was April 8, 2013.
                                              determine whether the Plan should be                    components and parameters, and to
                                              modified prior to approval on a                         finalize and propose recommended                        D. Development and Implementation
                                              permanent basis.                                        modifications to the Plan.                              Phases
                                                 On September 29, 2014, the                              The Participants believe that the                      The Plan was initially implemented
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                                              Participants submitted a Participant                    proposed amendment is consistent with                   as a one-year pilot program in two
                                                                                                         12 See Joint SROs letter to Brent J. Fields,
                                                                                                                                                              Phases, consistent with Section VIII of
                                                8 See Section VIII of the Plan.                       Secretary, SEC, dated September 29, 2014
                                                                                                                                                              the Plan: Phase I of Plan
                                                9 See Fourth Amendment, supra note 1.                 (‘‘Participant Impact Assessment’’).
                                                10 See Sixth Amendment, supra note 1.                    13 See Letter from Christopher B. Stone, Vice          14 17
                                                                                                                                                                    CFR 242.608.
                                                11 See Securities Exchange Act Release No. 71851      President, FINRA, to Brent J. Fields, Secretary, SEC,     15 SeeSecurities Exchange Act Release No. 67091
                                              (April 3, 2014), 79 FR 19687 (April 9, 2014).           dated May 28, 2015.                                     (May 31, 2012), 77 FR 33498, 33508 (June 6, 2012).



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                                                                          Federal Register / Vol. 80, No. 181 / Friday, September 18, 2015 / Notices                                                56517

                                              implementation began on April 8, 2013                   to act as the Chair of the Operating                  inspection and copying at the
                                              and was completed on May 3, 2013.                       Committee. Any recommendation for an                  Participants’ principal offices. All
                                              Implementation of Phase II of the Plan                  amendment to the Plan from the                        comments received will be posted
                                              began on August 5, 2013 and was                         Operating Committee that receives an                  without change; the Commission does
                                              completed on February 24, 2014.                         affirmative vote of at least two-thirds of            not edit personal identifying
                                              Pursuant to this proposed amendment,                    the Participants, but is less than                    information from submissions. You
                                              the Participants propose to extend the                  unanimous, shall be submitted to the                  should submit only information that
                                              pilot period so that it is set to end April             Commission as a request for an                        you wish to make available publicly. All
                                              22, 2016.                                               amendment to the Plan initiated by the                submissions should refer to File
                                                                                                      Commission under Rule 608.                            Number 4–631 and should be submitted
                                              E. Analysis of Impact on Competition                       On July 30, 2015, the Operating                    on or before October 9, 2015.
                                                The proposed amendment to the Plan                    Committee, duly constituted and                         By the Commission.
                                              does not impose any burden on                           chaired by Ms. Karen Lorentz of the                   Brent J. Fields,
                                              competition that is not necessary or                    NYSE, on behalf of Committee
                                                                                                                                                            Secretary.
                                              appropriate in furtherance of the                       Chairman Mr. Christopher B. Stone of
                                                                                                                                                            [FR Doc. 2015–23415 Filed 9–17–15; 8:45 am]
                                              purposes of the Exchange Act. The                       FINRA, met and voted unanimously to
                                                                                                                                                            BILLING CODE 8011–01–P
                                              Participants do not believe that the                    amend the Plan as set forth herein in
                                              proposed Plan introduces terms that are                 accordance with Section III(C) of the
                                              unreasonably discriminatory for the                     Plan. The Plan Advisory Committee was
                                                                                                                                                            SECURITIES AND EXCHANGE
                                              purposes of Section 11A(c)(1)(D) of the                 notified in connection with the Ninth
                                                                                                                                                            COMMISSION
                                              Exchange Act.                                           Amendment and was in favor.
                                                                                                                                                            [Release No. 34–75912; File No. SR–ISE–
                                              F. Written Understanding or Agreements                  III. Solicitation of Comments                         2015–27]
                                              Relating to Interpretation of, or                          Interested persons are invited to
                                              Participation in the Plan                               submit written data, views, and                       Self-Regulatory Organizations;
                                                 The Participants have no written                     arguments concerning the foregoing,                   International Securities Exchange,
                                              understandings or agreements relating                   including whether the proposed Ninth                  LLC; Notice of Filing and Immediate
                                              to interpretation of the Plan. Section                  Amendment is consistent with the Act.                 Effectiveness of Proposed Rule
                                              II(C) of the Plan sets forth how any                       Comments may be submitted by any                   Change To Amend the Schedule of
                                              entity registered as a national securities              of the following methods:                             Fees
                                              exchange or national securities                         Electronic Comments                                   September 14, 2015.
                                              association may become a Participant.                                                                            Pursuant to Section 19(b)(1) of the
                                                                                                        • Use the Commission’s Internet
                                              G. Approval of Amendment of the Plan                    comment form (http://www.sec.gov/                     Securities Exchange Act of 1934 (the
                                                                                                      rules/sro.shtml); or                                  ‘‘Act’’),1 and Rule 19b–4 thereunder,2
                                                Each of the Plan’s Participants has                                                                         notice is hereby given that on
                                              executed a written amended Plan.                          • Send an email to rule-comments@
                                                                                                      sec.gov. Please include File Number 4–                September 1, 2015, the International
                                              H. Terms and Conditions of Access                       631 on the subject line.                              Securities Exchange, LLC (the
                                                                                                                                                            ‘‘Exchange’’ or the ‘‘ISE’’) filed with the
                                                Section II(C) of the Plan provides that               Paper Comments                                        Securities and Exchange Commission
                                              any entity registered as a national
                                                                                                         • Send paper comments in triplicate                the proposed rule change, as described
                                              securities exchange or national                                                                               in Items I, II, and III below, which items
                                                                                                      to Secretary, Securities and Exchange
                                              securities association under the                                                                              have been prepared by the self-
                                                                                                      Commission, 100 F Street NE.,
                                              Exchange Act may become a Participant                                                                         regulatory organization. The
                                                                                                      Washington, DC 20549–1090.
                                              by: (1) Becoming a participant in the                                                                         Commission is publishing this notice to
                                              applicable Market Data Plans, as defined                All submissions should refer to File
                                                                                                      Number 4–631. This file number should                 solicit comments on the proposed rule
                                              in Section I(F) of the Plan; (2) executing                                                                    change from interested persons.
                                              a copy of the Plan, as then in effect; (3)              be included on the subject line if email
                                              providing each then-current Participant                 is used. To help the Commission                       I. Self-Regulatory Organization’s
                                              with a copy of such executed Plan; and                  process and review your comments                      Statement of the Terms of the Substance
                                              (4) effecting an amendment to the Plan                  more efficiently, please use only one                 of the Proposed Rule Change
                                              as specified in Section III(B) of the Plan.             method. The Commission will post all                     The ISE proposes to amend the
                                                                                                      comments on the Commission’s Internet                 Schedule of Fees to increase certain
                                              I. Method of Determination and                          Web site (http://www.sec.gov/rules/
                                              Imposition, and Amount of, Fees and                                                                           complex order fees and rebates as
                                                                                                      sro.shtml). Copies of the submission, all             described in more detail below. The text
                                              Charges                                                 subsequent amendments, all written                    of the proposed rule change is available
                                                 Not applicable.                                      statements with respect to the Plan that              on the Exchange’s Web site (http://
                                                                                                      are filed with the Commission, and all                www.ise.com), at the principal office of
                                              J. Method and Frequency of Processor                    written communications relating to the
                                              Evaluation                                                                                                    the Exchange, and at the Commission’s
                                                                                                      Plan between the Commission and any                   Public Reference Room.
                                                 Not applicable.                                      person, other than those that may be
                                                                                                      withheld from the public in accordance                II. Self-Regulatory Organization’s
                                              K. Dispute Resolution                                   with the provisions of 5 U.S.C. 552, will             Statement of the Purpose of, and
                                                                                                                                                            Statutory Basis for, the Proposed Rule
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                                                Section III(C) of the Plan provides for               be available for Web site viewing and
                                              each Participant to designate an                        printing in the Commission’s Public                   Change
                                              individual to represent the Participant                 Reference Room, 100 F Street NE.,                        In its filing with the Commission, the
                                              as a member of an Operating Committee.                  Washington, DC 20549, on official                     self-regulatory organization included
                                              No later than the initial date of the Plan,             business days between the hours of
                                              the Operating Committee shall designate                 10:00 a.m. and 3:00 p.m. Copies of the                  1 15   U.S.C. 78s(b)(1).
                                              one member of the Operating Committee                   filing also will be available for                       2 17   CFR 240.19b–4.



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Document Created: 2015-12-15 09:27:54
Document Modified: 2015-12-15 09:27:54
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 56515 

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