80 FR 60195 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Bandwidth
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 192 (October 5, 2015)
Federal Register Volume 80, Issue 192 (October 5, 2015)
| Page Range | 60195-60197 | |
| FR Document | 2015-25186 |
[Federal Register Volume 80, Number 192 (Monday, October 5, 2015)] [Notices] [Pages 60195-60197] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-25186] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-76024; File No. SR-CBOE-2015-080] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Bandwidth September 29, 2015. Pursuant to section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that on September 25, 2015, Chicago Board Options Exchange, Incorporated (the ``Exchange'' or ``CBOE'') filed with the Securities and Exchange Commission (the ``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. The Exchange has designated this proposal as a ``non-controversial'' proposed rule change pursuant to section 19(b)(3)(A) of the Act \4\ and Rule 19b-4(f)(6)(iii) thereunder,\5\ which renders it effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C.78s(b)(1). \2\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. \4\ 15 U.S.C. 78s(b)(3)(A). \5\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to provide that certain quote cancel messages are subject to bandwidth limitations. The text of the proposed rule change is available on the Exchange's Web site (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the Secretary, 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, the self-regulatory organization 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 those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, [[Page 60196]] of the most significant parts of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange is proposing to make an amendment to Rule 6.23B to state that certain quote messages are subject to bandwidth limitations and count towards the maximum number of quotes allowed per second(s). Specifically, quote cancel messages, a message type that is used by an originator of quotes to cancel quotes, will be subject to existing bandwidth limitations and counted towards the maximum number of quotes allowed per second(s) as described below. By way of background, the Exchange does not have unlimited system bandwidth to support an unlimited number of order and quote entries per second. For this reason, the Exchange limits each Trading Permit to a maximum number of messages per second(s). Currently, for example, a Trading Permit Holder (``TPH'') is limited to x quote messages (``blocks'') per 1 second. Each block is limited to a maximum number of quotes. Additionally, there is a set maximum number of total quotes per 3 seconds. For example, if the Exchange limited each Trading Permit to 100 quotes per 1 block, 10 blocks per 1 second and a maximum of 200 quotes per 3 seconds, then a user cannot, for example, enter 11 blocks per 1 second. The Exchange will reject the entire block of quotes that puts the user over the threshold. If a user in the above example were to enter, 10 blocks comprised of 10 quotes (i.e., total of 100 quotes) in the first second and 5 blocks comprised of 20 quotes (i.e., total of 100 quotes) in the following second, then the user would not be able to enter any more blocks (and therefore quotes) in the third second, as the user would exceed the 200 quotes per 3 second threshold. To date, quote cancel messages have not been counted towards the maximum number of messages per second(s). The Exchange believes however, that the volume of quote cancel requests by series messages in addition to quotes, can potentially threaten the Exchange's systems capacity. As such, the Exchange proposes to include these messages as part of the maximum number of quotes allowed per second(s), so as not to overburden the Exchange's system. Accordingly, a ``block'' may be comprised of either a maximum number of quotes or quote cancels messages (for requests by series \6\) and the maximum number of blocks per second allowed may be comprised of quote blocks, quote cancel message blocks or both quote and quote cancel message blocks. Also, the maximum number of total quotes per 3 seconds may now be comprised of quotes, quote cancel messages, or a combination of both. The Exchange will reject any block of messages that put a user over the bandwidth thresholds. --------------------------------------------------------------------------- \6\ For example, under the proposed rule change, if a TPH were to send a quote cancel message for a quote in the XYZ 75 Dec 2015 Call and the XYZ 85 Dec 2015 Call (i.e. each a different series of XYZ class), a TPH could send a block identifying each series and would count towards the bandwidth limitations as two quote messages and one block message. --------------------------------------------------------------------------- The Exchange established bandwidth allowances for the purpose of protecting its systems and ensuring its systems were capable of handling all its message traffic. The Exchange believes that subjecting quote cancel messages (by series) to bandwidth allowance will help achieve this objective. The Exchange notes however, that requests to cancel by class or by session will not count towards the bandwidth limitation. Because the ability to cancel all quotes in a class is an important risk control for TPHs, the Exchange does not wish to count requests to cancel quotes for an entire class towards the maximum bandwidth allowance. The Exchange will announce the implementation date of the proposed rule change in an Information Circular to be published no later than 90 days following the effective date of this rule filing. The implementation date will be no later than 180 days following the effective date of this rule filing. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the ``Act'') and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of section 6(b) of the Act.\7\ Specifically, the Exchange believes the proposed rule change is consistent with the section 6(b)(5) \8\ 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) \9\ requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers. --------------------------------------------------------------------------- \7\ 15 U.S.C. 78f(b). \8\ 15 U.S.C. 78f(b)(5). \9\ Id. --------------------------------------------------------------------------- In particular, the Exchange believes that imposing a bandwidth limitation on quote cancel messages protects its systems and ensures its systems are capable of handling its message traffic, thus removing impediments to and perfecting the mechanism of a free and open market and a national market system, as well protecting investors and the public interest. As noted above, quote cancel request messages in addition to quotes, can result in message traffic that can be burdensome to the Exchange's systems. In addition, the proposed rule change does not discriminate unfairly between market participants because this will be applied equally to all TPHs that may quote (i.e., Market-Makers). B. Self-Regulatory Organization's Statement on Burden on Competition CBOE does not believe that imposing a bandwidth limitation on quote cancel messages for a series or group of series will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. In particular, the Exchange does not believe that imposing a bandwidth limitation on quote cancel messages will place any burden on intramarket competition because this will be applied to equally to all relevant TPHs (i.e., Market-Makers), in that all Market-Makers will be limited (in terms of bandwidth capacity) in the number of quote cancel and quote messages that they can send to the Exchange. Additionally, as noted above, the proposed rule change allows the Exchange to better protect its systems and ensures its systems are capable of handling all its message traffic. The Exchange does not believe that imposing a bandwidth limitation on quote cancel messages will place any burden on intermarket competition because this only applies to the sending of quote cancel messages to CBOE. To the extent the proposed rule change makes CBOE a more attractive trading venue to market participants on other exchanges, such market participants may elect to become CBOE market participants. [[Page 60197]] C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has designated this rule filing as non-controversial under section 19(b)(3)(A) of the Act and Rule 19b-4(f)(6) thereunder.\10\ The proposed rule change effects a change that does not (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest; provided that the self-regulatory organization has given the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter times as designated by the Commission.\11\ --------------------------------------------------------------------------- \10\ In addition, Rule 19b-4(f)(6)(iii) requires the Exchange to give the Commission written notice of the Exchange's intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. \11\ The Exchange has fulfilled this requirement. --------------------------------------------------------------------------- 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: (1) Necessary or appropriate in the public interest; (2) for the protection of investors, or (3) otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-CBOE-2015-080 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-CBOE-2015-080. 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 20549-1090, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing will also be available for inspection and copying at the NYSE's principal office and on its Internet Web site at www.nyse.com. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-CBOE-2015-080 and should be submitted on or before October 26, 2015. --------------------------------------------------------------------------- \12\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\12\ Robert W. Errett, Deputy Secretary. [FR Doc. 2015-25186 Filed 10-2-15; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 80, No. 192 / Monday, October 5, 2015 / Notices 60195
C. Self-Regulatory Organization’s Paper Comments SECURITIES AND EXCHANGE
Statement on Comments on the COMMISSION
Proposed Rule Change Received From • Send paper comments in triplicate
Members, Participants, or Others to Brent J. Fields, Secretary, Securities
[Release No. 34–76024; File No. SR–CBOE–
and Exchange Commission 100 F Street 2015–080]
The Exchange has neither solicited NE., Washington, DC 20549–1090.
nor received written comments on the
proposed rule change. All submissions should refer to File Self-Regulatory Organizations;
Number SR–BYX–2015–40. This file Chicago Board Options Exchange,
III. Date of Effectiveness of the Incorporated; Notice of Filing and
number should be included on the
Proposed Rule Change and Timing for Immediate Effectiveness of a Proposed
Commission Action subject line if email is used. To help the
Rule Change Relating to Bandwidth
Commission process and review your
The Exchange has designated this rule comments more efficiently, please use September 29, 2015.
filing as non-controversial under only one method. The Commission will Pursuant to section 19(b)(1) 1 of the
Section 19(b)(3)(A) of the Act 15 and post all comments on the Commission’s Securities Exchange Act of 1934 (the
paragraph (f)(6) of Rule 19b–4 Internet Web site (http://www.sec.gov/ ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
thereunder.16 The proposed rule change rules/sro.shtml). Copies of the notice is hereby given that on
effects a change that (A) does not submission, all subsequent September 25, 2015, Chicago Board
significantly affect the protection of Options Exchange, Incorporated (the
amendments, all written statements
investors or the public interest; (B) does ‘‘Exchange’’ or ‘‘CBOE’’) filed with the
with respect to the proposed rule
not impose any significant burden on Securities and Exchange Commission
change that are filed with the
competition; and (C) by its terms, does (the ‘‘Commission’’) the proposed rule
not become operative for 30 days after Commission, and all written
communications relating to the change as described in Items I and II
the date of the filing, or such shorter below, which Items have been prepared
time as the Commission may designate proposed rule change between the
Commission and any person, other than by the self-regulatory organization. The
if consistent with the protection of Exchange has designated this proposal
investors and the public interest; those that may be withheld from the
public in accordance with the as a ‘‘non-controversial’’ proposed rule
provided that the self-regulatory change pursuant to section 19(b)(3)(A)
organization has given the Commission provisions of 5 U.S.C. 552, will be
of the Act 4 and Rule 19b–4(f)(6)(iii)
written notice of its intent to file the available for Web site viewing and
thereunder,5 which renders it effective
proposed rule change, along with a brief printing in the Commission’s Public
upon filing with the Commission. The
description and text of the proposed Reference Room, 100 F Street NE., Commission is publishing this notice to
rule change, at least five business days Washington, DC 20549 on official solicit comments on the proposed rule
prior to the date of filing of the business days between the hours of change from interested persons.
proposed rule change, or such shorter 10:00 a.m. and 3:00 p.m. Copies of such
time as designated by the Commission. filing also will be available for I. Self-Regulatory Organization’s
At any time within 60 days of the inspection and copying at the principal Statement of the Terms of Substance of
filing of the proposed rule change, the office of the Exchange. All comments the Proposed Rule Change
Commission may summarily received will be posted without change; The Exchange proposes to provide
temporarily suspend such rule change if the Commission does not edit personal that certain quote cancel messages are
it appears to the Commission that such identifying information from subject to bandwidth limitations. The
action is: (1) Necessary or appropriate in submissions. You should submit only text of the proposed rule change is
the public interest; (2) for the protection information that you wish to make available on the Exchange’s Web site
of investors; or (3) otherwise in available publicly. All submissions (http://www.cboe.com/AboutCBOE/
furtherance of the purposes of the Act. CBOELegalRegulatoryHome.aspx), at
should refer to File Number SR–BYX–
If the Commission takes such action, the the Exchange’s Office of the Secretary,
2015–40, and shouldbe submitted on or
Commission shall institute proceedings and at the Commission’s Public
before October 26, 2015.
to determine whether the proposed rule Reference Room.
should be approved or disapproved. For the Commission, by the Division of
Trading and Markets, pursuant to delegated II. Self-Regulatory Organization’s
IV. Solicitation of Comments authority.17 Statement of the Purpose of, and
Interested persons are invited to Robert W. Errett, Statutory Basis for, the Proposed Rule
submit written data, views, and Change
Deputy Secretary.
arguments concerning the foregoing, [FR Doc. 2015–25178 Filed 10–2–15; 8:45 am] In its filing with the Commission, the
including whether the proposed rule self-regulatory organization included
BILLING CODE 8011–01–P
change is consistent with the Act. statements concerning the purpose of,
Comments may be submitted by any of and basis for, the proposed rule change
the following methods: and discussed any comments it received
Electronic Comments on the proposed rule change. The text
of those statements may be examined at
• Use the Commission’s Internet the places specified in Item IV below.
mstockstill on DSK4VPTVN1PROD with NOTICES
comment form (http://www.sec.gov/ The Exchange has prepared summaries,
rules/sro.shtml); or set forth in sections A, B, and C below,
• Send an email to rule-comments@
sec.gov. Please include File Number SR– 1 15 U.S.C.78s(b)(1).
BYX–2015–40 on the subject line. 2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
15 15 U.S.C. 78s(b)(3)(A). 4 15 U.S.C. 78s(b)(3)(A).
16 17 CFR 240.19b–4. 17 17 CFR 200.30–3(a)(12). 5 17 CFR 240.19b–4(f)(6)(iii).
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![Federal Register / Vol. 80, No. 192 / Monday, October 5, 2015 / Notices 60197
C. Self-Regulatory Organization’s Electronic Comments SECURITIES AND EXCHANGE
Statement on Comments on the COMMISSION
Proposed Rule Change Received From • Use the Commission’s Internet
comment form (http://www.sec.gov/ [Release No. 34–76010; File No. SR–
Members, Participants, or Others NYSEArca–2015–82]
rules/sro.shtml); or
The Exchange neither solicited nor • Send an email to rule-comments@ Self-Regulatory Organizations; NYSE
received comments on the proposed sec.gov. Please include File Number SR– Arca, Inc.; Notice of Filing and
rule change. CBOE–2015–080 on the subject line. Immediate Effectiveness of Proposed
III. Date of Effectiveness of the Rule Change Adding Definitions
Paper Comments Applicable to Co-Location Services to
Proposed Rule Change and Timing for
Commission Action • Send paper comments in triplicate the NYSE Arca Options Fee Schedule
to Secretary, Securities and Exchange and, the NYSE Arca Equities Schedule
The Exchange has designated this rule Commission, 100 F Street NE., of Fees and Charges for Exchange
filing as non-controversial under section Washington, DC 20549–1090. Services and Modifying the Fee for
19(b)(3)(A) of the Act and Rule 19b– Users That Host Their Customers at
4(f)(6) thereunder.10 The proposed rule All submissions should refer to File the Exchange’s Data Center
change effects a change that does not (i) Number SR–CBOE–2015–080. This file
September 29, 2015.
significantly affect the protection of number should be included on the
subject line if email is used. To help the Pursuant to Section 19(b)(1) 1 of the
investors or the public interest; (ii) Securities Exchange Act of 1934 (the
impose any significant burden on Commission process and review your
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
competition; and (iii) become operative comments more efficiently, please use
notice is hereby given that, on
for 30 days from the date on which it only one method. The Commission will
September 18, 2015, NYSE Arca, Inc.
was filed, or such shorter time as the post all comments on the Commission’s (the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed
Commission may designate if consistent Internet Web site (http://www.sec.gov/ with the Securities and Exchange
with the protection of investors and the rules/sro.shtml). Copies of the Commission (the ‘‘Commission’’) the
public interest; provided that the self- submission, all subsequent proposed rule change as described in
regulatory organization has given the amendments, all written statements Items I and II below, which Items have
Commission written notice of its intent with respect to the proposed rule been prepared by the self-regulatory
to file the proposed rule change, along change that are filed with the organization. The Commission is
with a brief description and text of the Commission, and all written publishing this notice to solicit
proposed rule change, at least five communications relating to the comments on the proposed rule change
business days prior to the date of filing proposed rule change between the from interested persons.
of the proposed rule change, or such Commission and any person, other than
I. Self-Regulatory Organization’s
shorter times as designated by the those that may be withheld from the
Statement of the Terms of Substance of
Commission.11 public in accordance with the the Proposed Rule Change
At any time within 60 days of the provisions of 5 U.S.C. 552, will be
available for Web site viewing and The Exchange proposes to add
filing of the proposed rule change, the
printing in the Commission’s Public definitions applicable to co-location
Commission summarily may
Reference Room, 100 F Street NE., services to the NYSE Arca Options Fee
temporarily suspend such rule change if Schedule (the ‘‘Options Fee Schedule’’)
it appears to the Commission that such Washington, DC 20549–1090, on official
and, through its wholly owned
action is: (1) Necessary or appropriate in business days between the hours of
subsidiary NYSE Arca Equities, Inc.
the public interest; (2) for the protection 10:00 a.m. and 3:00 p.m. Copies of the
(‘‘NYSE Arca Equities’’), the NYSE Arca
of investors, or (3) otherwise in filing will also be available for Equities Schedule of Fees and Charges
furtherance of the purposes of the Act. inspection and copying at the NYSE’s for Exchange Services (the ‘‘Equities Fee
If the Commission takes such action, the principal office and on its Internet Web Schedule’’ and, together with the
Commission shall institute proceedings site at www.nyse.com. All comments Options Fee Schedule, the ‘‘Fee
to determine whether the proposed rule received will be posted without change; Schedules’’) and modify the fee for
should be approved or disapproved. the Commission does not edit personal users that host their customers at the
identifying information from Exchange’s Data Center. The text of the
IV. Solicitation of Comments
submissions. You should submit only proposed rule change is available on the
Interested persons are invited to information that you wish to make Exchange’s Web site at www.nyse.com,
submit written data, views, and available publicly. All submissions at the principal office of the Exchange,
arguments concerning the foregoing, should refer to File Number SR–CBOE– and at the Commission’s Public
including whether the proposed rule 2015–080 and should be submitted on Reference Room.
change is consistent with the Act. or before October 26, 2015. II. Self-Regulatory Organization’s
Comments may be submitted by any of For the Commission, by the Division of Statement of the Purpose of, and
the following methods: Trading and Markets, pursuant to delegated Statutory Basis for, the Proposed Rule
authority.12 Change
10 In addition, Rule 19b–4(f)(6)(iii) requires the
mstockstill on DSK4VPTVN1PROD with NOTICES
Robert W. Errett, In its filing with the Commission, the
Exchange to give the Commission written notice of
the Exchange’s intent to file the proposed rule Deputy Secretary. self-regulatory organization included
change, along with a brief description and text of [FR Doc. 2015–25186 Filed 10–2–15; 8:45 am] statements concerning the purpose of,
the proposed rule change, at least five business days
prior to the date of filing of the proposed rule BILLING CODE 8011–01–P and basis for, the proposed rule change
change, or such shorter time as designated by the
1 15 U.S.C. 78s(b)(1).
Commission. The Exchange has satisfied this
requirement. 2 15 U.S.C. 78a.
11 The Exchange has fulfilled this requirement. 12 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4.
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Document Created: 2015-12-15 08:52:57
Document Modified: 2015-12-15 08:52:57
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 80 FR 60195 |
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