80 FR 68337 - Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d-2; Order Approving and Declaring Effective a Proposed Plan for the Allocation of Regulatory Responsibilities Between BATS Exchange, Inc., BATS Y-Exchange, Inc., BOX Options Exchange LLC, Chicago Board Options Exchange, Incorporated, C2 Options Exchange, Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., International Securities Exchange, LLC, ISE Gemini, LLC, Miami International Securities Exchange, LLC, The NASDAQ Stock Market LLC, NASDAQ OMX BX, Inc., NASDAQ OMX PHLX, Inc., National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc. Relating to Regulation NMS Rules
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 213 (November 4, 2015)
Federal Register Volume 80, Issue 213 (November 4, 2015)
| Page Range | 68337-68338 | |
| FR Document | 2015-28068 |
[Federal Register Volume 80, Number 213 (Wednesday, November 4, 2015)] [Notices] [Pages 68337-68338] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-28068] [[Page 68337]] ======================================================================= ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-76311; File No. 4-618] Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d-2; Order Approving and Declaring Effective a Proposed Plan for the Allocation of Regulatory Responsibilities Between BATS Exchange, Inc., BATS Y-Exchange, Inc., BOX Options Exchange LLC, Chicago Board Options Exchange, Incorporated, C2 Options Exchange, Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., International Securities Exchange, LLC, ISE Gemini, LLC, Miami International Securities Exchange, LLC, The NASDAQ Stock Market LLC, NASDAQ OMX BX, Inc., NASDAQ OMX PHLX, Inc., National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc. Relating to Regulation NMS Rules October 29, 2015. On September 2, 2015, BATS Exchange, Inc. (``BATS''), BATS Y- Exchange, Inc. (``BATS Y''), BOX Options Exchange LLC (``BOX''), Chicago Board Options Exchange, Incorporated (``CBOE''), C2 Options Exchange, Incorporated (``C2''), Chicago Stock Exchange, Inc. (``CHX''), EDGA Exchange, Inc. (``EDGA''), EDGX Exchange, Inc. (``EDGX''), Financial Industry Regulatory Authority, Inc. (``FINRA''), International Securities Exchange, LLC (``ISE''), ISE Gemini, LLC (``ISE Gemini''), Miami International Securities Exchange, LLC (``MIAX''), The NASDAQ Stock Market LLC (``NASDAQ''), NASDAQ OMX BX, Inc. (``BX''), NASDAQ OMX PHLX, Inc. (``Phlx''), National Stock Exchange, Inc. (``NSX''), New York Stock Exchange LLC (``NYSE''), NYSE MKT LLC (``NYSE MKT''), and NYSE Arca, Inc. (``NYSE Arca'') (each, a ``Participating Organization,'' and, together, the ``Participating Organizations'' or the ``Parties''), filed with the Securities and Exchange Commission (``Commission'' or ``SEC'') an amended plan for the allocation of regulatory responsibilities with respect to certain Regulation NMS Rules listed in Exhibit A to the Plan (``17d-2 Plan'' or the ``Plan''). The Commission received no comments on the Plan. This order approves and declares effective the Plan. I. Introduction Section 19(g)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ among other things, requires every self-regulatory organization (``SRO'') registered as either a national securities exchange or national securities association to examine for, and enforce compliance by, its members and persons associated with its members with the Act, the rules and regulations thereunder, and the SRO's own rules, unless the SRO is relieved of this responsibility pursuant to Section 17(d) or Section 19(g)(2) of the Act.\2\ Without this relief, the statutory obligation of each individual SRO could result in a pattern of multiple examinations of broker-dealers that maintain memberships in more than one SRO (``Common Members''). Such regulatory duplication would add unnecessary expenses for common members and their SROs. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(g)(1). \2\ 15 U.S.C. 78q(d) and 15 U.S.C. 78s(g)(2), respectively. --------------------------------------------------------------------------- Section 17(d)(1) of the Act \3\ was intended, in part, to eliminate unnecessary multiple examinations and regulatory duplication.\4\ With respect to a common member, Section 17(d)(1) authorizes the Commission, by rule or order, to relieve an SRO of the responsibility to receive regulatory reports, to examine for and enforce compliance with applicable statutes, rules, and regulations, or to perform other specified regulatory functions. --------------------------------------------------------------------------- \3\ 15 U.S.C. 78q(d)(1). \4\ See Securities Act Amendments of 1975, Report of the Senate Committee on Banking, Housing, and Urban Affairs to Accompany S. 249, S. Rep. No. 94-75, 94th Cong., 1st Session 32 (1975). --------------------------------------------------------------------------- To implement Section 17(d)(1), the Commission adopted two rules: Rule 17d-1 and Rule 17d-2 under the Act.\5\ Rule 17d-1 authorizes the Commission to name a single SRO as the designated examining authority (``DEA'') to examine common members for compliance with the financial responsibility requirements imposed by the Act, or by Commission or SRO rules.\6\ When an SRO has been named as a common member's DEA, all other SROs to which the common member belongs are relieved of the responsibility to examine the firm for compliance with the applicable financial responsibility rules. On its face, Rule 17d-1 deals only with an SRO's obligations to enforce member compliance with financial responsibility requirements. Rule 17d-1 does not relieve an SRO from its obligation to examine a common member for compliance with its own rules and provisions of the federal securities laws governing matters other than financial responsibility, including sales practices and trading activities and practices. --------------------------------------------------------------------------- \5\ 17 CFR 240.17d-1 and 17 CFR 240.17d-2, respectively. \6\ See Securities Exchange Act Release No. 12352 (April 20, 1976), 41 FR 18808 (May 7, 1976). --------------------------------------------------------------------------- To address regulatory duplication in these and other areas, the Commission adopted Rule 17d-2 under the Act.\7\ Rule 17d-2 permits SROs to propose joint plans for the allocation of regulatory responsibilities with respect to their common members. Under paragraph (c) of Rule 17d-2, the Commission may declare such a plan effective if, after providing for appropriate notice and comment, it determines that the plan is necessary or appropriate in the public interest and for the protection of investors; to foster cooperation and coordination among the SROs; to remove impediments to, and foster the development of, a national market system and a national clearance and settlement system; and is in conformity with the factors set forth in Section 17(d) of the Act. Commission approval of a plan filed pursuant to Rule 17d-2 relieves an SRO of those regulatory responsibilities allocated by the plan to another SRO. --------------------------------------------------------------------------- \7\ See Securities Exchange Act Release No. 12935 (October 28, 1976), 41 FR 49091 (November 8, 1976). --------------------------------------------------------------------------- II. Proposed Plan On September 2, 2015, the parties submitted a proposed amendment to the Plan. The primary purpose of the amendment is to add Regulation NMS Rules 606, 607, and 611(c) and (d). In addition, because Regulation NMS Rule 606 applies to ``NMS Securites,'' and thus includes responsibility for options, the Amended Plan adds additional Participating Organizations that are options markets. The proposed 17d-2 Plan is intended to reduce regulatory duplication for firms that are members of more than one Participating Organization.\8\ The proposed amendments to the Plan provide for the allocation of regulatory responsibility according to whether the covered rule pertains to NMS stocks or NMS securities. For covered rules that pertain to NMS stocks (i.e., Rules 607, 611, and 612), FINRA would serve as the ``Designated Regulation NMS Examining Authority'' (``DREA'') for common members that are members of FINRA, and therein would assume certain examination and enforcement responsibilities for those members with respect to specified Regulation NMS rules. For common members that are not [[Page 68338]] members of FINRA, the amended Plan provides that the member's DEA would serve as the DREA, provided that the DEA exchange operates a national securities exchange or facility that trades NMS stocks and the common member is a member of such exchange or facility. Section 1(c) of the amended Plan contains a list of proposed principles that would be applicable to the allocation of common members in cases not specifically addressed in the Plan. An exchange that does not trade NMS stocks would have no regulatory authority for covered Regulation NMS rules pertaining to NMS stocks. For covered rules that pertain to NMS securities, and thus include options (i.e., Rule 606), the proposed amended Plan provides that the DREA will be the same as the DREA for the rules pertaining to NMS stocks. For common members that are not members of an exchange that trades NMS stocks, the common member would be allocated according to the principles set forth in Section 1(c) of the Plan. --------------------------------------------------------------------------- \8\ The proposed 17d-2 Plan refers to these members as ``Common Members.'' --------------------------------------------------------------------------- The text of the Plan delineates the proposed regulatory responsibilities with respect to the Parties. Included in the proposed Plan is an exhibit (the ``Covered Regulation NMS Rules'') that lists the federal securities laws, rules, and regulations, for which the applicable DREA would bear examination and enforcement responsibility under the proposed amended Plan for Common Members of the Participating Organization and their associated persons. Specifically, under the 17d-2 Plan, the applicable DREA would assume examination and enforcement responsibility relating to compliance by Common Members with the Covered Regulation NMS Rules. Covered Regulation NMS Rules would not include the application of any rule of a Participating Organization, or any rule or regulation under the Act, to the extent that it pertains to violations of insider trading activities, because such matters are covered by a separate multiparty agreement under Rule 17d-2.\9\ Under the Plan, Participating Organizations would retain full responsibility for surveillance and enforcement with respect to trading activities or practices involving their own marketplace.\10\ --------------------------------------------------------------------------- \9\ See Securities Exchange Act Release No. 58350 (August 13, 2008), 73 FR 48247 (August 18, 2008) (File No. 4-566) (notice of filing of proposed plan). See also Securities Exchange Act Release No. 58536 (September 12, 2008) (File No. 4-566) (order approving and declaring effective the plan). \10\ See paragraph 1 of the proposed 17d-2 Plan. --------------------------------------------------------------------------- III. Discussion The Commission finds that the proposed Plan is consistent with the factors set forth in Section 17(d) of the Act \11\ and Rule 17d-2(c) thereunder \12\ in that the proposed Plan is necessary or appropriate in the public interest and for the protection of investors, fosters cooperation and coordination among SROs, and removes impediments to and fosters the development of the national market system. In particular, the Commission believes that the proposed Plan should reduce unnecessary regulatory duplication by allocating to the applicable DREA certain examination and enforcement responsibilities for Common Members that would otherwise be performed by multiple Parties. Accordingly, the proposed Plan promotes efficiency by reducing costs to Common Members. Furthermore, because the Parties will coordinate their regulatory functions in accordance with the proposed Plan, the Plan should promote investor protection. --------------------------------------------------------------------------- \11\ 15 U.S.C. 78q(d). \12\ 17 CFR 240.17d-2(c). --------------------------------------------------------------------------- The Commission is hereby declaring effective a plan that allocates regulatory responsibility for certain provisions of the federal securities laws, rules, and regulations as set forth in Exhibit A to the Plan. The Commission notes that any amendment to the Plan must be approved by the relevant Parties as set forth in Paragraph 22 of the Plan and must be filed with and approved by the Commission before it may become effective.\13\ --------------------------------------------------------------------------- \13\ See Paragraph 22 of the Plan. The Commission notes, however, that changes to Exhibit B to the Plan (the allocation of Common Members to DREAs) are not required to be filed with, and approved by, the Commission before they become effective. --------------------------------------------------------------------------- IV. Conclusion This Order gives effect to the Plan filed with the Commission in File No. 4-618. The Parties shall notify all members affected by the Plan of their rights and obligations under the Plan. It is therefore ordered, pursuant to Section 17(d) of the Act, that the Plan in File No. 4-618 is hereby approved and declared effective. It is further ordered that the Parties who are not the DREA as to a particular Common Member are relieved of those regulatory responsibilities allocated to the Common Member's DREA under the Plan to the extent of such allocation. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\14\ --------------------------------------------------------------------------- \14\ 17 CFR 200.30-3(a)(34). --------------------------------------------------------------------------- Jill M. Peterson, Assistant Secretary. [FR Doc. 2015-28068 Filed 11-3-15; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 80, No. 213 / Wednesday, November 4, 2015 / Notices 68337
SECURITIES AND EXCHANGE I. Introduction obligation to examine a common
COMMISSION Section 19(g)(1) of the Securities member for compliance with its own
Exchange Act of 1934 (‘‘Act’’),1 among rules and provisions of the federal
[Release No. 34–76311; File No. 4–618] other things, requires every self- securities laws governing matters other
regulatory organization (‘‘SRO’’) than financial responsibility, including
Program for Allocation of Regulatory registered as either a national securities sales practices and trading activities and
Responsibilities Pursuant to Rule 17d– exchange or national securities practices.
association to examine for, and enforce To address regulatory duplication in
2; Order Approving and Declaring
compliance by, its members and persons these and other areas, the Commission
Effective a Proposed Plan for the
associated with its members with the adopted Rule 17d–2 under the Act.7
Allocation of Regulatory Rule 17d–2 permits SROs to propose
Responsibilities Between BATS Act, the rules and regulations
thereunder, and the SRO’s own rules, joint plans for the allocation of
Exchange, Inc., BATS Y-Exchange, regulatory responsibilities with respect
Inc., BOX Options Exchange LLC, unless the SRO is relieved of this
responsibility pursuant to Section 17(d) to their common members. Under
Chicago Board Options Exchange, paragraph (c) of Rule 17d–2, the
Incorporated, C2 Options Exchange, or Section 19(g)(2) of the Act.2 Without
this relief, the statutory obligation of Commission may declare such a plan
Incorporated, Chicago Stock effective if, after providing for
each individual SRO could result in a
Exchange, Inc., EDGA Exchange, Inc., appropriate notice and comment, it
pattern of multiple examinations of
EDGX Exchange, Inc., Financial broker-dealers that maintain determines that the plan is necessary or
Industry Regulatory Authority, Inc., memberships in more than one SRO appropriate in the public interest and
International Securities Exchange, (‘‘Common Members’’). Such regulatory for the protection of investors; to foster
LLC, ISE Gemini, LLC, Miami duplication would add unnecessary cooperation and coordination among the
International Securities Exchange, expenses for common members and SROs; to remove impediments to, and
LLC, The NASDAQ Stock Market LLC, their SROs. foster the development of, a national
NASDAQ OMX BX, Inc., NASDAQ OMX Section 17(d)(1) of the Act 3 was market system and a national clearance
PHLX, Inc., National Stock Exchange, intended, in part, to eliminate and settlement system; and is in
Inc., New York Stock Exchange LLC, unnecessary multiple examinations and conformity with the factors set forth in
NYSE MKT LLC, and NYSE Arca, Inc. regulatory duplication.4 With respect to Section 17(d) of the Act. Commission
a common member, Section 17(d)(1) approval of a plan filed pursuant to Rule
Relating to Regulation NMS Rules
authorizes the Commission, by rule or 17d–2 relieves an SRO of those
October 29, 2015. order, to relieve an SRO of the regulatory responsibilities allocated by
responsibility to receive regulatory the plan to another SRO.
On September 2, 2015, BATS
Exchange, Inc. (‘‘BATS’’), BATS Y- reports, to examine for and enforce II. Proposed Plan
Exchange, Inc. (‘‘BATS Y’’), BOX compliance with applicable statutes, On September 2, 2015, the parties
Options Exchange LLC (‘‘BOX’’), rules, and regulations, or to perform submitted a proposed amendment to the
Chicago Board Options Exchange, other specified regulatory functions. Plan. The primary purpose of the
To implement Section 17(d)(1), the amendment is to add Regulation NMS
Incorporated (‘‘CBOE’’), C2 Options
Commission adopted two rules: Rule Rules 606, 607, and 611(c) and (d). In
Exchange, Incorporated (‘‘C2’’), Chicago
17d–1 and Rule 17d–2 under the Act.5 addition, because Regulation NMS Rule
Stock Exchange, Inc. (‘‘CHX’’), EDGA Rule 17d–1 authorizes the Commission
Exchange, Inc. (‘‘EDGA’’), EDGX 606 applies to ‘‘NMS Securites,’’ and
to name a single SRO as the designated thus includes responsibility for options,
Exchange, Inc. (‘‘EDGX’’), Financial examining authority (‘‘DEA’’) to
Industry Regulatory Authority, Inc. the Amended Plan adds additional
examine common members for Participating Organizations that are
(‘‘FINRA’’), International Securities compliance with the financial
Exchange, LLC (‘‘ISE’’), ISE Gemini, LLC options markets.
responsibility requirements imposed by The proposed 17d–2 Plan is intended
(‘‘ISE Gemini’’), Miami International the Act, or by Commission or SRO to reduce regulatory duplication for
Securities Exchange, LLC (‘‘MIAX’’), rules.6 When an SRO has been named as firms that are members of more than one
The NASDAQ Stock Market LLC a common member’s DEA, all other Participating Organization.8 The
(‘‘NASDAQ’’), NASDAQ OMX BX, Inc. SROs to which the common member proposed amendments to the Plan
(‘‘BX’’), NASDAQ OMX PHLX, Inc. belongs are relieved of the responsibility provide for the allocation of regulatory
(‘‘Phlx’’), National Stock Exchange, Inc. to examine the firm for compliance with responsibility according to whether the
(‘‘NSX’’), New York Stock Exchange the applicable financial responsibility covered rule pertains to NMS stocks or
LLC (‘‘NYSE’’), NYSE MKT LLC (‘‘NYSE rules. On its face, Rule 17d–1 deals only NMS securities. For covered rules that
MKT’’), and NYSE Arca, Inc. (‘‘NYSE with an SRO’s obligations to enforce pertain to NMS stocks (i.e., Rules 607,
Arca’’) (each, a ‘‘Participating member compliance with financial 611, and 612), FINRA would serve as
Organization,’’ and, together, the responsibility requirements. Rule 17d–1 the ‘‘Designated Regulation NMS
‘‘Participating Organizations’’ or the does not relieve an SRO from its Examining Authority’’ (‘‘DREA’’) for
‘‘Parties’’), filed with the Securities and common members that are members of
1 15 U.S.C. 78s(g)(1).
Exchange Commission (‘‘Commission’’ FINRA, and therein would assume
2 15 U.S.C. 78q(d) and 15 U.S.C. 78s(g)(2), certain examination and enforcement
asabaliauskas on DSK5VPTVN1PROD with NOTICES
or ‘‘SEC’’) an amended plan for the respectively.
allocation of regulatory responsibilities 3 15 U.S.C. 78q(d)(1).
responsibilities for those members with
with respect to certain Regulation NMS 4 See Securities Act Amendments of 1975, Report respect to specified Regulation NMS
Rules listed in Exhibit A to the Plan of the Senate Committee on Banking, Housing, and rules. For common members that are not
Urban Affairs to Accompany S. 249, S. Rep. No. 94–
(‘‘17d–2 Plan’’ or the ‘‘Plan’’). The 75, 94th Cong., 1st Session 32 (1975). 7 See Securities Exchange Act Release No. 12935
Commission received no comments on 5 17 CFR 240.17d–1 and 17 CFR 240.17d–2,
(October 28, 1976), 41 FR 49091 (November 8,
the Plan. This order approves and respectively. 1976).
6 See Securities Exchange Act Release No. 12352 8 The proposed 17d–2 Plan refers to these
declares effective the Plan.
(April 20, 1976), 41 FR 18808 (May 7, 1976). members as ‘‘Common Members.’’
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![68338 Federal Register / Vol. 80, No. 213 / Wednesday, November 4, 2015 / Notices
members of FINRA, the amended Plan III. Discussion For the Commission, by the Division of
provides that the member’s DEA would Trading and Markets, pursuant to delegated
serve as the DREA, provided that the The Commission finds that the authority.14
DEA exchange operates a national proposed Plan is consistent with the Jill M. Peterson,
securities exchange or facility that factors set forth in Section 17(d) of the Assistant Secretary.
trades NMS stocks and the common Act 11 and Rule 17d–2(c) thereunder 12 [FR Doc. 2015–28068 Filed 11–3–15; 8:45 am]
member is a member of such exchange in that the proposed Plan is necessary BILLING CODE 8011–01–P
or facility. Section 1(c) of the amended or appropriate in the public interest and
Plan contains a list of proposed for the protection of investors, fosters
principles that would be applicable to cooperation and coordination among SECURITIES AND EXCHANGE
the allocation of common members in SROs, and removes impediments to and COMMISSION
cases not specifically addressed in the fosters the development of the national
Plan. An exchange that does not trade market system. In particular, the [Release No. 34–76295; File No. SR–Phlx–
NMS stocks would have no regulatory Commission believes that the proposed 2015–83]
authority for covered Regulation NMS Plan should reduce unnecessary Self-Regulatory Organizations;
rules pertaining to NMS stocks. For regulatory duplication by allocating to NASDAQ OMX PHLX LLC; Notice of
covered rules that pertain to NMS the applicable DREA certain Filing and Immediate Effectiveness of
securities, and thus include options examination and enforcement Proposed Rule Change to Risk Monitor
(i.e., Rule 606), the proposed amended responsibilities for Common Members Mechanism
Plan provides that the DREA will be the that would otherwise be performed by
same as the DREA for the rules multiple Parties. Accordingly, the October 29, 2015.
pertaining to NMS stocks. For common proposed Plan promotes efficiency by Pursuant to Section 19(b)(1) of the
members that are not members of an reducing costs to Common Members. Securities Exchange Act of 1934
exchange that trades NMS stocks, the Furthermore, because the Parties will (‘‘Act’’),1 and Rule 19b–4 thereunder,2
common member would be allocated coordinate their regulatory functions in notice is hereby given that on October
according to the principles set forth in accordance with the proposed Plan, the 15, 2015, NASDAQ OMX PHLX LLC
Section 1(c) of the Plan. Plan should promote investor (‘‘Phlx’’ or ‘‘Exchange’’) filed with the
The text of the Plan delineates the protection. Securities and Exchange Commission
proposed regulatory responsibilities (‘‘SEC’’ or ‘‘Commission’’) the proposed
The Commission is hereby declaring rule change as described in Items I, II,
with respect to the Parties. Included in
effective a plan that allocates regulatory and III, below, which Items have been
the proposed Plan is an exhibit (the
responsibility for certain provisions of prepared by the Exchange. The
‘‘Covered Regulation NMS Rules’’) that
the federal securities laws, rules, and Commission is publishing this notice to
lists the federal securities laws, rules,
and regulations, for which the regulations as set forth in Exhibit A to solicit comments on the proposed rule
applicable DREA would bear the Plan. The Commission notes that change from interested persons.
examination and enforcement any amendment to the Plan must be
I. Self-Regulatory Organization’s
responsibility under the proposed approved by the relevant Parties as set
Statement of the Terms of Substance of
amended Plan for Common Members of forth in Paragraph 22 of the Plan and the Proposed Rule Change
the Participating Organization and their must be filed with and approved by the
Commission before it may become The Exchange proposes to amend
associated persons.
effective.13 Rule 1093 entitled ‘‘Phlx XL Risk
Specifically, under the 17d–2 Plan, Monitor Mechanism’’ by reserving this
the applicable DREA would assume IV. Conclusion rule and relocating the rule governing
examination and enforcement the Risk Monitor Mechanism into Phlx
responsibility relating to compliance by This Order gives effect to the Plan Rule 1095, entitled ‘‘Automated
Common Members with the Covered filed with the Commission in File No. Removal of Quotes’’ which contains
Regulation NMS Rules. Covered 4–618. The Parties shall notify all similar market maker 3 risk monitor
Regulation NMS Rules would not members affected by the Plan of their tools. The Exchange is also modifying
include the application of any rule of a rights and obligations under the Plan.
Participating Organization, or any rule It is therefore ordered, pursuant to 14 17 CFR 200.30–3(a)(34).
or regulation under the Act, to the Section 17(d) of the Act, that the Plan 1 15 U.S.C. 78s(b)(1).
extent that it pertains to violations of in File No. 4–618 is hereby approved 2 17 CFR 240.19b–4.
insider trading activities, because such and declared effective.
3 A ‘‘Market Maker’’ includes Registered Options
matters are covered by a separate Traders (‘‘ROTs’’) (Rule 1014(b)(i) and (ii)), which
multiparty agreement under Rule It is further ordered that the Parties includes Streaming Quote Traders (‘‘SQTs’’) (see
Rule 1014(b)(ii)(A)) and Remote Streaming Quote
17d–2.9 Under the Plan, Participating who are not the DREA as to a particular Traders (‘‘RSQTs’’) (see Rule 1014(b)(ii)(B)). An
Organizations would retain full Common Member are relieved of those SQT is defined in Exchange Rule 1014(b)(ii)(A) as
responsibility for surveillance and regulatory responsibilities allocated to an ROT who has received permission from the
the Common Member’s DREA under the Exchange to generate and submit option quotations
enforcement with respect to trading electronically in options to which such SQT is
activities or practices involving their Plan to the extent of such allocation.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
assigned. An RSQT is defined in Exchange Rule
own marketplace.10 1014(b)(ii)(B) as an ROT that is a member or
11 15 U.S.C. 78q(d). member organization with no physical trading floor
12 17 presence who has received permission from the
9 See Securities Exchange Act Release No. 58350 CFR 240.17d–2(c).
13 See Paragraph 22 of the Plan. The Commission
Exchange to generate and submit option quotations
(August 13, 2008), 73 FR 48247 (August 18, 2008) electronically in options to which such RSQT has
(File No. 4–566) (notice of filing of proposed plan). notes, however, that changes to Exhibit B to the been assigned. An RSQT may only submit such
See also Securities Exchange Act Release No. 58536 Plan (the allocation of Common Members to quotations electronically from off the floor of the
(September 12, 2008) (File No. 4–566) (order DREAs) are not required to be filed with, and Exchange. A Market Maker also includes a
approving and declaring effective the plan). approved by, the Commission before they become specialist, an Exchange member who is registered
10 See paragraph 1 of the proposed 17d–2 Plan. effective. as an options specialist pursuant to Rule 1020(a).
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Document Created: 2018-03-01 11:28:20
Document Modified: 2018-03-01 11:28:20
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 80 FR 68337 |
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