80 FR 65836 - Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 11.11, Routing to Away Trading Centers

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 207 (October 27, 2015)

[Federal Register Volume 80, Number 207 (Tuesday, October 27, 2015)]
[Notices]
[Pages 65836-65838]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-27214]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76212; File No. SR-EDGX-2015-46)]


Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
Rule 11.11, Routing to Away Trading Centers

October 21, 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 October 13, 2015, EDGX Exchange, Inc. (the ``Exchange'' 
or ``EDGX'') 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 Exchange. 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 19-
4(f)(6) 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19-4.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 17 CFR 240.19-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend Rule 11.11, Routing to Away 
Trading Centers, to: (i) Enable Users \6\ to designate their orders for 
participation in the re-opening (following a halt, suspension, or 
pause) of a primary listing market (BATS, NYSE, Nasdaq, NYSE MKT, or 
NYSE Arca) if received before the re-opening time of such market; and 
(ii) amend the ROOC routing option to remove a provision regarding not 
routing orders in BATS listed securities designated for participation 
in the re-opening process on BATS following a halt, suspension, or 
pause.
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    \6\ The term ``User'' is defined as ``any Member or Sponsored 
Participant who is authorized to obtain access to the System 
pursuant to Rule 11.3.'' See Exchange Rule 1.5(ee).
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    The text of the proposed rule change is available at the Exchange's 
Web site at www.batstrading.com, at the principal office of the 
Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
Sections A, B, and C below, of the most significant parts of such 
statements.

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

1. Purpose
    The Exchange proposes to amend Rule 11.11, Routing to Away Trading 
Centers, to: (i) Enable Users \7\ to designate their orders for 
participation in the re-opening (following a halt, suspension, or 
pause) of a primary listing market (BATS, NYSE, Nasdaq, NYSE MKT, or 
NYSE Arca); and (ii) amend the ROOC routing option to remove a 
provision regarding not routing orders in BATS listed securities 
designated for participation in the re-opening process on BATS 
following a halt, suspension, or pause. The Exchange currently offers 
the ROOC routing option, under which Users may designate their orders 
for participation in the opening or closing process, in addition to the 
re-opening (following a halt, suspension, or pause), of a primary 
listing market, if received before the opening/re-opening/closing time 
of such market.\8\ However, some Users only wish that their orders be 
routed to participate in the primary market's re-opening process, and 
not its opening or closing processes. Therefore, the Exchange proposes 
to enable Users to designate their orders for participation in the re-
opening of a primary listing market.
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    \7\ The term ``User'' is defined as ``any Member or Sponsored 
Participant who is authorized to obtain access to the System 
pursuant to Rule 11.3.'' See Exchange Rule 1.5(ee).
    \8\ See Exchange Rule 11.11(g)(8).
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    The proposed optionality would operate like the current ROOC 
routing option, but for routing to the primary listing market's opening 
or closing process. Lastly, like the ROOC routing option, any remaining 
shares will either be posted to the EDGX Book, executed, or routed to 
destinations on the System routing table.\9\ Should no halt, 
suspension, or pause occur on the primary listing market, such orders 
would remain on the EDGX Book, executed, or routed to destinations on 
the System routing table.
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    \9\ The term ``System routing table'' refers to the proprietary 
process for determining the specific options exchanges to which the 
System routes orders and the order in which it routes them. See 
Exchange Rule 11.11(g).
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    In addition, the Exchange proposes to amend the ROOC routing option 
to remove a provision regarding not routing orders in BATS listed 
securities designated for participation in the re-opening process on 
BATS following a halt, suspension, or pause. Previously, due to system 
limitations, the Exchange was unable to route orders in BATS listed 
securities to participate in the re-opening process on BATS following a 
halt, suspension or pause. In such case, the orders remained on the 
EDGX Book \10\ and became eligible for execution once the halt, 
suspension, or pause has been lifted. The Exchange has since performed 
the necessary system modifications and removed this restriction from 
its system. The Exchange is now able to route orders in BATS listed 
securities to BATS to participate in the reopening following a halt, 
suspension or pause pursuant to the ROOC routing option. Therefore, the 
Exchange proposes to remove this

[[Page 65837]]

restriction from the description of the ROOC routing option under Rule 
11.11.
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    \10\ The term ``EDGX Book'' is defined as ``the System's 
electronic file of orders.'' See Exchange Rule 1.5(d).
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \11\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \12\ in particular, in that it is designed to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in 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. Certain Users whose orders 
are resting on the EDGX Book may wish that their order only be routed 
to the primary market's re-opening process following a halt, suspension 
or pause, and not the primary market's opening or closing processes. 
The proposed rule change promotes just and equitable principles of 
trade because it would provide such Users with additional flexibility 
where they wish that their order only be eligible to route to the 
primary listing market to participate in the re-opening process 
following a halt, suspension or pause. In addition, and as discussed 
above, the proposed rule change is similar to the Exchange's current 
ROOC routing option.
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    \11\ 15 U.S.C. 78f(b).
    \12\ 15 U.S.C. 78f(b)(5).
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    The Exchange also believes its proposal to remove a provision from 
the description of the ROOC routing option regarding not routing orders 
in BATS listed securities designated for participation in the re-
opening process on BATS following a halt, suspension, or pause is 
consistent with Section 6(b)(5) of the Act \13\ in that it intended 
[sic] to make the Exchange's rules clearer and less confusing for 
investors by eliminating a provision that is no longer necessary. 
Previously, due to system limitations, the Exchange was unable to route 
orders in BATS listed securities to participate in the re-opening 
process on BATS following a halt, suspension or pause. The Exchange has 
since removed this restriction from its system. The proposed change 
updates the description of the ROOC routing option to remove this 
restriction for BATS listed securities as the Exchange is now able to 
route such orders to BATS to participate in the opening process 
following a halt, suspension or pause. Therefore, the Exchange believes 
the proposal removes impediments to and perfects the mechanism of a 
free and open market and a national market system, and, in general, 
protects investors and the public interest because it would enable the 
Exchange to treat orders in BATS listed securities that are subject to 
the ROOC routing option like NYSE and Nasdaq listed securities and 
route such order [sic] to the re-opening process on BATS following a 
halt, suspension or pause.
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    \13\ Id.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposal will impose any 
burden on competition not necessary or appropriate in furtherance of 
the purposes of the Act. The Exchange believes that its proposal would 
increase competition because it offers Users an alternative means to 
route orders to the primary listing market to participate in the re-
opening following a halt, suspension, or pause as if they entered 
orders on that market directly. In addition, the proposed rule change 
amendment to the ROOC routing option is not designed to address any 
competitive issues but rather avoid investor confusion by updating the 
rule text to reflect current system functionality.

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

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

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

    Because the proposed rule change does not (i) significantly affect 
the protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 30 
days from the date on which it was filed, or such shorter time as the 
Commission may designate if consistent with the protection of investors 
and the public interest, the proposed rule change has become effective 
pursuant to Section 19(b)(3)(A) of the Act \14\ and Rule 19b-4(f)(6) 
thereunder.\15\
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    \14\ 15 U.S.C. 78s(b)(3)(A).
    \15\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written 
notice of its intent to file the proposed rule change, along with a 
brief description and the text of the proposed rule change, at least 
five business days prior to the date of filing of the proposed rule 
change, or such shorter time as designated by the Commission.
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    The Exchange has asked the Commission to waive the 30-day operative 
delay so that the proposal may become operative immediately upon 
filing. The Exchange stated that waiver of the operative delay will 
allow the ROOC routing option to be used to route orders in BATS listed 
securities to BATS to participate in the re-opening process on BATS. 
The Exchange also stated that the proposal would enable orders in BATS 
listed securities to be treated like orders in NYSE and Nasdaq listed 
securities when using the ROOC routing option. Moreover, the Exchange 
stated that the proposed new routing functionality would operate like 
its current ROOC routing option and would provide Users with additional 
flexibility to have their orders routed only to the primary market's 
re-opening process. The Commission believes that waiving the 30-day 
operative delay is consistent with the protection of investors and the 
public interest. Therefore, the Commission hereby waives the operative 
delay and designates the proposed rule change operative upon 
filing.\16\
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    \16\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-EDGX-2015-46 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.


[[Page 65838]]


All submissions should refer to File Number SR-EDGX-2015-46. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549 on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-EDGX-2015-46, and should be 
submitted on or before November 17, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\17\
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    \17\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-27214 Filed 10-26-15; 8:45 am]
BILLING CODE 8011-01-P