80_FR_68556 80 FR 68343 - Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Amending Rule 6.45 Relating to Disaster Recovery

80 FR 68343 - Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Amending Rule 6.45 Relating to Disaster Recovery

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 213 (November 4, 2015)

Page Range68343-68347
FR Document2015-28023

Federal Register, Volume 80 Issue 213 (Wednesday, November 4, 2015) 
[Federal Register Volume 80, Number 213 (Wednesday, November 4, 2015)]
[Notices]
[Pages 68343-68347]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-28023]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76300; File No. SR-C2-2015-030]


Self-Regulatory Organizations; C2 Options Exchange, Incorporated; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Amending Rule 6.45 Relating to Disaster Recovery

October 29, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on October 28, 2015, C2 Options Exchange, Incorporated (``Exchange'' or 
``C2'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared by the Exchange. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Rule 6.45 relating to disaster 
recovery. 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.

[[Page 68344]]

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 aspects of such 
statements.

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

1. Purpose
    C2 proposes to amend Rule 6.45 relating to disaster recovery. 
Specifically, C2 proposes to update Rule 6.45 to further describe C2's 
back-up systems, the circumstances under which they may be used and the 
testing that C2 may conduct to ensure the availability, functionality 
and performance of such systems. Additionally, C2 proposes certain 
updates to Rule 6.45 in response to new disaster recovery regulations 
and business resumption standards recently adopted by the Securities 
and Exchange Commission (``SEC'' or ``Commission'') as promulgated in 
Regulation Systems Compliance and Integrity (``Regulation SCI'') under 
the Securities Exchange Act of 1934 (the ``Act'').\3\
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    \3\ See Securities Exchange Act Release No. 73639 (November 19, 
2014), 79 FR 72252 (December 5, 2014) (Regulation Systems Compliance 
and Integrity) (File No. S7-01-13).
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Background
    C2 adopted Rule 6.45 in 2012 for the limited purpose of providing 
alternative means of operation in the event C2's trading system became 
inoperable or otherwise unavailable for use due to a disaster or other 
unusual circumstance. In particular, Rule 6.45, as originally adopted, 
was intended to allow C2 to operate a Disaster Recovery Facility 
(``DRF'') to continue to trade exclusively-listed option classes until 
C2's main trading system was again available.\4\ At that time, C2 
intended to utilize hardware located in the Chicago Board Options 
Exchange, Incorporated (``CBOE'') building in Chicago, IL for the 
purposes of operating the DRF. C2's main trade engine is located on the 
east coast.
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    \4\ See Securities Exchange Act Release No. 67357 (July 5 2012), 
77 FR 40928 (July 11, 2012) (SR-C2-2012-011).
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    In addition to adding greater detail to C2's disaster recovery 
rules in Rule 6.45, C2 proposes to make updates to Rule 6.45 to 
harmonize its disaster recovery rules with the newly implemented 
disaster recovery-related regulatory imperatives of Regulation SCI. 
Regulation SCI supersedes and replaces the SEC's voluntary Automation 
Review Policy (``ARP''), established by the Commission's two policy 
statements each titled ``Automated Systems of Self-Regulatory 
Organizations,'' issued in 1989 and 1991, expanding existing practices 
and making them mandatory.\5\ As part of Regulation SCI, C2 is required 
to maintain back-up and recovery capabilities with sufficient 
resiliency and geographical diversity and that are reasonably designed 
to achieve next business-day resumption of trading and two-hour 
resumption of critical systems following a wide-scale disruption.\6\ C2 
must also participate in at least annual testing of its business 
continuity and disaster recovery plans and, to that end, develop and 
adopt standards to designate which of its TPHs must participate in 
testing in order to reasonably ensure the maintenance of a fair and 
orderly market if C2's disaster recovery plan must be activated.\7\
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    \5\ See Securities Exchange Act Release No. 73639 (November 19, 
2014), 79 FR at 72252 (December 5, 2014) (Regulation Systems 
Compliance and Integrity) (File No. S7-01-13).
    \6\ 17 CFR 242.1001(a)(2)(v).
    \7\ Id. at Sec.  242.1004.
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Proposed Rule Changes
    C2 now proposes to make changes to Rule 6.45 to allow for trading 
in all C2-traded option classes on a back-up data center in the event 
the main trading system is unavailable. The proposed rule will no 
longer be limited to exclusively-listed options traded on C2. 
Furthermore, prior to the compliance date of Regulation SCI, C2 will 
have separate hardware designated for the C2 back-up data center (as 
opposed to using CBOE hardware).
    C2 proposes to make changes to Rule 6.45 to provide additional 
details regarding C2's back-up trading systems and business continuity 
and disaster recovery plans activation and testing. As discussed above, 
C2 also seeks to update its disaster recovery rules to ensure 
consistency with Regulation SCI.
    Current Rule 6.45 is divided into four sections, (a) through (d). 
Rule 6.45(a) authorizes C2 to maintain a DRF to preserve C2's ability 
to trade exclusively-listed options in the event C2's primary data 
center becomes inoperable or otherwise unavailable for use. Current 
Rule 6.45(b) describes the notice that must be given prior to 
commencing trading on back-up data center systems. Current Rule 6.45(c) 
describes the rules that would be in effect if C2 were to switch its 
trading operations to the DRF. Current Rule 6.45(d) prescribes that 
Trading Permit Holders (``TPH'') are required to take appropriate 
actions as instructed by C2 to accommodate C2's ability to trade 
options via the DRF.
    C2 proposes to make rule changes to Rule 6.45 with detail added to 
each section of the current rule. Under proposed Rule 6.45(a) (General) 
C2 would adopt a general statement regarding the purpose of its 
disaster recovery rules, providing that C2 maintains business 
continuity and disaster recovery plans that may be effected in the 
interests of the continued operation of fair and orderly markets in the 
event of a systems failure, disaster, or other unusual circumstances 
that might threaten the ability to conduct business on C2.
    Proposed Rule 6.45(b) (Back-up Data Center) would incorporate parts 
of the current Rule 6.45(a) in that it includes a statement that C2 
maintains a back-up data center (replacing what was formerly referenced 
as a ``Disaster Recovery Facility'' or ``DRF'') in order to preserve 
C2's ability to conduct business in the event C2's primary data center 
becomes inoperable or otherwise unavailable for use. Proposed Rule 
6.45(b) no longer limits the C2 disaster recovery facility to 
preserving C2's ability to trade exclusively-listed options. Currently 
C2 does not trade exclusively-listed options. The proposed Rule would 
now cover all option classes available for trading on C2. The proposed 
Rule notes that disaster recovery plans may be effected to ensure the 
continued operation of a fair and orderly market. C2 is removing the 
reference to the trading of exclusively-listed options in favor of 
``conduct business''. This proposed rule change reflects the fact that 
C2 may be engaged in business activities other than just the trading of 
options, including, but not limited to, the dissemination of market 
data and certain regulatory functions.
    Proposed Rule 6.45(b) would add the scenario of a significant 
systems failure to the list of causes that may trigger an operational 
switch to C2's back-up data center. The proposed addition of 
significant systems failures to the list of scenarios that may trigger 
an operational switch to C2's back-up data center is intended to more 
accurately reflect the realities of electronic trading environments and 
contemporary threats

[[Page 68345]]

posed to the operation of fair and orderly markets. In addition to the 
reformulation of the description of C2's back-up data center, proposed 
Rule 6.45(b) would also contain subsections similar to the notice, 
applicable rules, and Trading Permit Holder (``TPH'') preparations 
provisions currently contained in Rules 6.45(b) through (d).
    Proposed Rule 6.45(b)(i) (Back-up Data Center Functionality), would 
make clear the functional and performance standards that the back-up 
data center must be reasonably designed to achieve. Specifically, 
proposed Rule 6.45(b)(i) would provide that C2 maintains a back-up data 
center that C2 has determined is reasonably designed to achieve prompt 
resumption of systems consistent with Regulation SCI. Proposed Rule 
6.45(b)(i) would also provide that nothing in the provisions of 
proposed Rule 6.45(b) shall be interpreted to require C2 to develop or 
maintain a back-up data center designed to fully replicate the 
capacity, latency, and other features of the primary data center. This 
statement attempts to make clear that in order to preserve C2's ability 
to conduct business in the event C2's primary data center becomes 
inoperable or otherwise unavailable for use, C2 must maintain a back-up 
data center that is reasonably designed achieve resumption of systems 
consistent with Regulation SCI during a significant systems failure, 
disaster or other unusual circumstances, rather than replicate C2's 
primary data center systems. C2 believes that the standards set forth 
in proposed Rule 6.45(b)(i) are reasonable to help ensure the 
maintenance of fair and orderly markets in the event of a significant 
systems failure, disaster or other unusual circumstances and are 
consistent with provisions in the release language of Regulation 
SCI.\8\
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    \8\ See Securities Exchange Act Release No. 73639 (November 19, 
2014), 79 FR at 72353 (December 5, 2014) (Regulation Systems 
Compliance and Integrity) (File No. S7-01-13).
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    Proposed Rule 6.45(b)(ii) (Notice), would be similar to current 
Rule 6.45(b) and provide that prior to commencing trading on the back-
up data center, C2 shall announce publicly the classes that will be 
available for trading. Proposed Rule 6.45(b)(iii) (Applicable Rules) 
would provide that in the event the primary data center becomes 
inoperable, trading will continue using the back-up data center and all 
trading rules will remain in effect. Consistent with current Rule 
6.45(c), the proposed rule would also contain the provisions that all 
non-trading rules of C2 shall continue to apply.
    Proposed Rule 6.45(b)(iv) (Trading Permit Holder Participation) 
regarding testing of C2's back-up data center would contain provisions 
similar to current Rule 6.45(d) (Trading Permit Holder Preparations), 
but add subparagraphs to more clearly articulate C2's authority to 
conduct testing of its back-up data center systems. Thus, similar to 
current Rule 6.45(d), proposed Rule 6.45(b)(iv) would provide that TPHs 
are required to take appropriate actions as instructed by C2 to 
accommodate C2's ability to trade options via the back-up data center. 
C2 also proposes changing the rule text in proposed Rule 6.45(b)(iv) to 
provide that TPHs are required to take appropriate actions as 
instructed by C2 to accommodate C2's ability to conduct business via 
the back-up data center, rather than solely to accommodate C2's ability 
to trade options. Under the proposed rule change, the title of current 
Rule 6.45(d) (Trading Permit Holder Preparations) would also be changed 
in proposed Rule 6.45(b)(iv) (Trading Permit Holder Participation) to 
better describe the purpose of the rule provisions.
    Subsections (A) through (C) under proposed Rule 6.45(b)(iv) are 
designed to harmonize C2's back-up data center testing rules with 
certain provisions of Regulation SCI. Under proposed Rule 
6.45(b)(iv)(A) (Designated BCP/DR Participants), C2 shall designate 
those Trading Permit Holders that the C2 reasonably determines are, 
taken as a whole, the minimum necessary for the maintenance of fair and 
orderly markets in the event of the activation of the C2's business 
continuity and disaster recovery plans (``Designated BCP/DR 
Participants''). Designated BCP/DR Participants will include: (1) All 
C2 Market-Makers and; (2) all C2 Trading Permit Holders connected to 
the C2 primary data center and transacting non-Participant customer 
business, unless a C2 Trading Permit Holder, other than a C2 Market-
Maker, can demonstrate ready access to the back-up data center through 
another C2 Trading Permit Holder that is a designated participant. C2 
has reasonably determined that a C2 TPH, other than a C2 Market-Maker, 
who can demonstrate ready-access to the back-up data center through 
another C2 Trading Permit Holder, that is a designated participant, is 
not necessary for the maintenance of fair and orderly markets in the 
event of the activation of the C2's business continuity and disaster 
recovery plans. Criteria for designating BCP/DR participants will be 
announced prior via Regulatory Circular. Any changes to the standards 
by which a market participant might be determined to be a Designated 
BCP/DR Participant would be applied prospectively with reasonable 
advance notice as announced via Regulatory Circular. C2 would first 
announce the criteria by which market participants would be determined 
to be Designated BCP/DR Participants by November 1, 2015.
    C2 has attempted to model the provisions of proposed Rule 
6.45(b)(iv)(A) based on provisions of Regulation SCI, which require C2 
to establish standards for the designation of those members or 
participants that C2 reasonably determines are, taken as a whole, the 
minimum number of members or participants necessary for the maintenance 
of fair and orderly markets in the event of the activation of its 
business continuity and disaster recovery plans.\9\ Also consistent 
with Regulation SCI, proposed Rule 6.45(b)(iv)(B) (Fair and Orderly 
Market Conditions) would make clear that nothing in proposed Rule 
6.45(b) would require C2 to assume that average levels of liquidity, 
depth, or other characteristics of a usual trading session must be 
present in order to achieve a fair and orderly market in the event of 
the activation of C2's business continuity and disaster recovery 
plans.\10\
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    \9\ See 17 CFR 242.1004(a)-(b).
    \10\ See Securities Exchange Act Release No. 73639 (November 19, 
2014), 79 FR at 72353 (December 5, 2014) (Regulation Systems 
Compliance and Integrity) (File No. S7-01-13).
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    Proposed Rule 6.45(b)(iv)(C) (Business Continuity and Disaster 
Recovery Plans Testing), would provide that C2 shall require Designated 
BCP/DR Participants and may require other market participants to 
participate in scheduled business continuity and disaster recovery 
plans tests in the manner and frequency prescribed by C2. Proposed Rule 
6.45(b)(iv)(C) would set forth C2's authority to conduct testing of its 
business continuity and disaster recovery plans and obtain assistance 
from Designated BCP/DR Participants and other market participants in 
conducting such tests. C2 notes that the provisions of proposed Rule 
6.45(b)(iv)(C) are consistent with C2's current rules \11\ as well as 
provisions of Regulation SCI pertaining to business continuity and 
disaster recovery plan testing.\12\ Proposed Rule 6.45(b)(iv)(C)(1) 
(Documentation and Reports), would provide that C2 may require 
Designated BCP/DR Participants

[[Page 68346]]

and/or other market participants to provide documentation and reports 
regarding tests conducted pursuant to Rule 6.45, including related data 
and information, as may be requested by C2, and in the manner and 
frequency prescribed by C2. Proposed Rule 6.45(b)(iv)(C)(2) (Notice), 
would provide that C2 will provide reasonable prior notice of scheduled 
business continuity and disaster recovery plans tests to Trading Permit 
Holders, which notice shall describe the general nature of the test(s) 
and identify the Trading Permit Holders required to participate and 
shall be announced via Regulatory Circular.
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    \11\ See Rules 6.34 (Participant Electronic Connectivity); 
6.45(d) (Trading Permit Holder Preparations).
    \12\ See 17 CFR 242.1004(a)-(b).
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2. Statutory Basis
    C2 believes the proposed rule change is consistent with the Act and 
the rules and regulations thereunder applicable to C2 and, in 
particular, the requirements of Section 6(b) of the Act \13\ and 
Regulation SCI.\14\ Specifically, C2 believes the proposed rule change 
is consistent with the Section 6(b)(5) \15\ 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, C2 believes the proposed rule change is consistent with 
the Section 6(b)(5) \16\ requirement that the rules of an exchange not 
be designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
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    \13\ 15 U.S.C. 78f(b).
    \14\ See 17 CFR 242.1001(a) and 1004.
    \15\ 15 U.S.C. 78f(b)(5).
    \16\ Id.
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    In particular, the proposed rule change is designed to promote C2's 
ability to ensure the continued operation of a fair and orderly market 
in the event of a systems failure, disaster, or other unusual 
circumstances that might threaten the ability to conduct business on 
C2. C2 recognizes that switching operations to the back-up data center 
may occur in times of uncertainty or great volatility in the markets. 
It is at these times that the investors may have the greatest need for 
viable, trustworthy marketplaces. The proposed rule changes seek to 
ensure that such a marketplace will exist when most needed. 
Accordingly, C2 believes that the proposed rule protects investors in 
the most fundamental sense by helping to ensure that a fair and orderly 
market will exist at a time when such a market may be most needed.
    C2 also believes that the proposed rule change promotes just and 
equitable principles of trade by adding detail and clarity to the 
Rules. The proposed rule change seeks to provide additional clarity to 
C2's disaster recovery rules, putting all market participants on notice 
as to how C2 will function in case of significant systems disruption or 
other disaster situation. C2 is continuously updating the Rules to 
provide additional detail, clarity, and transparency regarding its 
operations and trading systems and regulatory authority. C2 believes 
that the adoption of detailed, clear, and transparent rules reduces 
burdens on competition and promotes just and equitable principles of 
trade. C2 also believes that adding greater detail to the Rules 
regarding C2's ability to ensure the continuous operation of the market 
and preserve the ability to conduct business on C2 will increase 
confidence in the markets and encourage wider participation in the 
markets and greater investment. Finally, C2 notes that proposed Rule 
6.45 is designed to harmonize C2's disaster recovery rules with 
Regulation SCI under the Act.

B. Self-Regulatory Organization's Statement on Burden on Competition

    C2 does not believe that the proposed rule change will impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act. Rather, the proposed rule 
change will help ensure that competitive markets remain operative in 
the event of a systems failure or other disaster event. C2 notes that 
the proposed rule change is designed to clarify C2's authority to 
require market participants to participate in, and provide necessary 
liquidity to ensure fair and orderly markets. C2 further notes that the 
proposed rule change is designed to ensure competitive markets in that 
it is designed around the mandates of Regulation SCI, which each of the 
national securities exchanges is required to satisfy.

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

    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 \17\ and Rule 19b-4(f)(6) 
thereunder.\18\
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    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f)(6). 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 
Commission deems this requirement to have been met.
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    A proposed rule change filed under Rule 19b-4(f)(6) \19\ normally 
does not become operative for 30 days after the date of filing. 
However, pursuant to Rule 19b-4(f)(6)(iii) \20\ the Commission may 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest.
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    \19\ 17 CFR 240.19b-4(f)(6).
    \20\ 17 CFR 240.19b-4(f)(6)(iii).
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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. According to the Exchange, the proposed rule change does not 
present any novel or substantive issues. The proposed rule change is 
substantially the same as CBOE Rule 6.18,\21\ except for provisions 
relating to the loss of a trading floor and the specific factors for 
designating BCP/DR Participants. The Commission notes that C2 does not 
have a trading floor and further, that the factors proposed by C2 are 
those that C2 reasonably determined are, taken as a whole, the minimum 
necessary for the maintenance of fair and orderly markets in the event 
of the activation of the Exchange's business continuity and disaster 
recovery plans. These factors are designed to harmonize C2's rule with 
Regulation SCI. Accordingly, the

[[Page 68347]]

Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest as 
it will allow the Exchange to incorporate changes required under 
Regulation SCI, such as establishing standards for designating BCP/DR 
Participants, prior to the November 3, 2015 compliance date. Therefore, 
the Commission designates the proposed rule change to be operative upon 
filing.\22\
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    \21\ CBOE Rule 6.18 was recently amended in CBOE-2015-088, which 
was filed on October 8, 2015, and effective upon filing. See 
Securities Exchange Act Release No. 76203 (October 20, 2015), 80 FR 
65258 (October 26, 2015). In CBOE-2015-088, CBOE amended CBOE Rule 
6.18 to further describe CBOE's back-up systems, the circumstances 
under which they may be used, and the testing that CBOE may conduct 
to ensure the availability, functionality and performance of such 
systems, as well incorporate provisions for Regulation SCI.
    \22\ 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.

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-C2-2015-030 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-C2-2015-030. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549 on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of such filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-C2-2015-030, and should be 
submitted on or before November 25, 2015.
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    \23\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\23\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-28023 Filed 11-3-15; 8:45 am]
 BILLING CODE 8011-01-P

Federal Register / Vol. 80, No. 213 / Wednesday, November 4, 2015 / Notices 68343 of Section 6(b) of the Act.4 In particular, become operative prior to 30 days after filing also will be available for the Exchange believes the proposed rule the date of filing. Rule 19b–4(f)(6)(iii), inspection and copying at the principal change is consistent with the Section however, permits the Commission to offices of the Exchange. All comments 6(b)(5) 5 requirements that the rules of designate a shorter time if such action received will be posted without change; an exchange be designed to promote just is consistent with the protection of the Commission does not edit personal and equitable principles of trade, to investors and the public interest. identifying information from prevent fraudulent and manipulative At any time within 60 days of the submissions. You should submit only acts and practices, to foster cooperation filing of the proposed rule change, the information that you wish to make and coordination with persons engaged Commission summarily may available publicly. All submissions in facilitating transactions in securities, temporarily suspend such rule change if should refer to File Number SR– to remove impediments to and to perfect it appears to the Commission that such NASDAQ–2015–121, and should be the mechanism for a free and open action is: (i) Necessary or appropriate in submitted on or before November 25, market and a national market system, the public interest; (ii) for the protection 2015. and, in general, to protect investors and of investors; or (iii) otherwise in For the Commission, by the Division of the public interest. The Exchange furtherance of the purposes of the Act. Trading and Markets, pursuant to delegated believes that the change in terminology If the Commission takes such action, the authority.8 will protect investors and the public Commission shall institute proceedings interest by eliminating potential to determine whether the proposed rule Robert W. Errett, confusion that may exist because of should be approved or disapproved. Deputy Secretary. unnecessary differences in terminology IV. Solicitation of Comments [FR Doc. 2015–28021 Filed 11–3–15; 8:45 am] between Nasdaq rules and the BILLING CODE 8011–01–P marketplace. Interested persons are invited to As noted, the Exchange believes that submit written data, views, and the changes proposed are non- arguments concerning the foregoing, SECURITIES AND EXCHANGE controversial and technical in nature. including whether the proposed rule COMMISSION change is consistent with the Act. B. Self-Regulatory Organization’s Comments may be submitted by any of Statement on Burden on Competition the following methods: [Release No. 34–76300; File No. SR–C2– 2015–030] The Exchange does not believe that the proposed rule change will impose Electronic Comments • Use the Commission’s Internet Self-Regulatory Organizations; C2 any burden on competition that is not comment form (http://www.sec.gov/ Options Exchange, Incorporated; necessary or appropriate in furtherance rules/sro.shtml); or Notice of Filing and Immediate of the purposes of the Act. The • Send an email to rule-comments@ Effectiveness of a Proposed Rule Exchange believes that the proposed sec.gov. Please include File Number SR– Change Amending Rule 6.45 Relating rule change will help align rule NASDAQ–2015–121 on the subject line. to Disaster Recovery terminology with the terminology utilized in the marketplace for these Paper Comments October 29, 2015. new products and be used uniformly. • Send paper comments in triplicate Pursuant to Section 19(b)(1) of the C. Self-Regulatory Organization’s to Secretary, Securities and Exchange Securities Exchange Act of 1934 Statement on Comments on the Commission, 100 F Street NE., (‘‘Act’’),1 and Rule 19b–4 thereunder,2 Proposed Rule Change Received From Washington, DC 20549–1090. notice is hereby given that on October Members, Participants, or Others All submissions should refer to File 28, 2015, C2 Options Exchange, Written comments were neither Number SR–NASDAQ–2015–121. This Incorporated (‘‘Exchange’’ or ‘‘C2’’) filed solicited nor received. file number should be included on the with the Securities and Exchange subject line if email is used. To help the Commission (‘‘Commission’’) the III. Date of Effectiveness of the proposed rule change as described in Proposed Rule Change and Timing for Commission process and review your comments more efficiently, please use Items I and II below, which Items have Commission Action been prepared by the Exchange. The only one method. The Commission will The proposed rule change is filed for post all comments on the Commission’s Commission is publishing this notice to immediate effectiveness pursuant to Internet Web site (http://www.sec.gov/ solicit comments on the proposed rule Section 19(b)(3)(A) 6 of the Act and Rule rules/sro.shtml). Copies of the change from interested persons. 19b–4(f)(6) thereunder.7 The Exchange submission, all subsequent asserts that the proposed rule change I. Self-Regulatory Organization’s amendments, all written statements Statement of the Terms of Substance of does not (i) significantly affect the with respect to the proposed rule protection of investors or the public the Proposed Rule Change change that are filed with the interest, (ii) impose any significant Commission, and all written The Exchange proposes to amend burden on competition, and (iii) become communications relating to the Rule 6.45 relating to disaster recovery. operative for 30 days after its filing date, proposed rule change between the The text of the proposed rule change is or such shorter time as the Commission Commission and any person, other than available on the Exchange’s Web site may designate if consistent with the those that may be withheld from the asabaliauskas on DSK5VPTVN1PROD with NOTICES (http://www.cboe.com/AboutCBOE/ protection of investors and the public public in accordance with the CBOELegalRegulatoryHome.aspx), at interest. provisions of 5 U.S.C. 552, will be A proposed rule change filed under the Exchange’s Office of the Secretary, available for Web site viewing and and at the Commission’s Public Rule 19b–4(f)(6) normally does not printing in the Commission’s Public Reference Room. 4 15 U.S.C. 78f(b). Reference Room, 100 F Street NE., 5 15 U.S.C. 78f(b)(5). Washington, DC 20549 on official 8 17 CFR 200.30–3(a)(12). 6 15 U.S.C. 78s(b)(3)(A). business days between the hours of 1 15 U.S.C. 78s(b)(1). 7 17 CFR 240.19b–4(f)(6). 10:00 a.m. and 3:00 p.m. Copies of such 2 17 CFR 240.19b–4. VerDate Sep<11>2014 17:00 Nov 03, 2015 Jkt 238001 PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 E:\FR\FM\04NON1.SGM 04NON1

68344 Federal Register / Vol. 80, No. 213 / Wednesday, November 4, 2015 / Notices II. Self-Regulatory Organization’s main trade engine is located on the east use. Current Rule 6.45(b) describes the Statement of the Purpose of, and coast. notice that must be given prior to Statutory Basis for, the Proposed Rule In addition to adding greater detail to commencing trading on back-up data Change C2’s disaster recovery rules in Rule 6.45, center systems. Current Rule 6.45(c) C2 proposes to make updates to Rule describes the rules that would be in In its filing with the Commission, the 6.45 to harmonize its disaster recovery effect if C2 were to switch its trading Exchange included statements rules with the newly implemented operations to the DRF. Current Rule concerning the purpose of and basis for disaster recovery-related regulatory 6.45(d) prescribes that Trading Permit the proposed rule change and discussed imperatives of Regulation SCI. Holders (‘‘TPH’’) are required to take any comments it received on the Regulation SCI supersedes and replaces appropriate actions as instructed by C2 proposed rule change. The text of these the SEC’s voluntary Automation Review to accommodate C2’s ability to trade statements may be examined at the Policy (‘‘ARP’’), established by the options via the DRF. places specified in Item IV below. The Commission’s two policy statements C2 proposes to make rule changes to Exchange has prepared summaries, set each titled ‘‘Automated Systems of Self- Rule 6.45 with detail added to each forth in sections A, B, and C below, of Regulatory Organizations,’’ issued in section of the current rule. Under the most significant aspects of such 1989 and 1991, expanding existing proposed Rule 6.45(a) (General) C2 statements. practices and making them mandatory.5 would adopt a general statement As part of Regulation SCI, C2 is required regarding the purpose of its disaster A. Self-Regulatory Organization’s to maintain back-up and recovery recovery rules, providing that C2 Statement of the Purpose of, and capabilities with sufficient resiliency maintains business continuity and Statutory Basis for, the Proposed Rule and geographical diversity and that are disaster recovery plans that may be Change reasonably designed to achieve next effected in the interests of the continued 1. Purpose business-day resumption of trading and operation of fair and orderly markets in two-hour resumption of critical systems the event of a systems failure, disaster, C2 proposes to amend Rule 6.45 following a wide-scale disruption.6 C2 or other unusual circumstances that relating to disaster recovery. must also participate in at least annual might threaten the ability to conduct Specifically, C2 proposes to update Rule testing of its business continuity and business on C2. 6.45 to further describe C2’s back-up disaster recovery plans and, to that end, Proposed Rule 6.45(b) (Back-up Data systems, the circumstances under which develop and adopt standards to Center) would incorporate parts of the they may be used and the testing that C2 designate which of its TPHs must current Rule 6.45(a) in that it includes may conduct to ensure the availability, participate in testing in order to a statement that C2 maintains a back-up functionality and performance of such reasonably ensure the maintenance of a data center (replacing what was systems. Additionally, C2 proposes fair and orderly market if C2’s disaster formerly referenced as a ‘‘Disaster certain updates to Rule 6.45 in response recovery plan must be activated.7 Recovery Facility’’ or ‘‘DRF’’) in order to to new disaster recovery regulations and preserve C2’s ability to conduct Proposed Rule Changes business in the event C2’s primary data business resumption standards recently C2 now proposes to make changes to center becomes inoperable or otherwise adopted by the Securities and Exchange Rule 6.45 to allow for trading in all C2- unavailable for use. Proposed Rule Commission (‘‘SEC’’ or ‘‘Commission’’) traded option classes on a back-up data 6.45(b) no longer limits the C2 disaster as promulgated in Regulation Systems center in the event the main trading recovery facility to preserving C2’s Compliance and Integrity (‘‘Regulation system is unavailable. The proposed ability to trade exclusively-listed SCI’’) under the Securities Exchange Act rule will no longer be limited to options. Currently C2 does not trade of 1934 (the ‘‘Act’’).3 exclusively-listed options traded on C2. exclusively-listed options. The Background Furthermore, prior to the compliance proposed Rule would now cover all date of Regulation SCI, C2 will have option classes available for trading on C2 adopted Rule 6.45 in 2012 for the separate hardware designated for the C2 C2. The proposed Rule notes that limited purpose of providing alternative back-up data center (as opposed to using disaster recovery plans may be effected means of operation in the event C2’s CBOE hardware). to ensure the continued operation of a trading system became inoperable or C2 proposes to make changes to Rule fair and orderly market. C2 is removing otherwise unavailable for use due to a 6.45 to provide additional details the reference to the trading of disaster or other unusual circumstance. regarding C2’s back-up trading systems exclusively-listed options in favor of In particular, Rule 6.45, as originally and business continuity and disaster ‘‘conduct business’’. This proposed rule adopted, was intended to allow C2 to recovery plans activation and testing. As change reflects the fact that C2 may be operate a Disaster Recovery Facility discussed above, C2 also seeks to update engaged in business activities other than (‘‘DRF’’) to continue to trade its disaster recovery rules to ensure just the trading of options, including, exclusively-listed option classes until consistency with Regulation SCI. but not limited to, the dissemination of C2’s main trading system was again Current Rule 6.45 is divided into four market data and certain regulatory available.4 At that time, C2 intended to sections, (a) through (d). Rule 6.45(a) functions. utilize hardware located in the Chicago authorizes C2 to maintain a DRF to Proposed Rule 6.45(b) would add the Board Options Exchange, Incorporated preserve C2’s ability to trade scenario of a significant systems failure (‘‘CBOE’’) building in Chicago, IL for the exclusively-listed options in the event to the list of causes that may trigger an asabaliauskas on DSK5VPTVN1PROD with NOTICES purposes of operating the DRF. C2’s C2’s primary data center becomes operational switch to C2’s back-up data inoperable or otherwise unavailable for center. The proposed addition of 3 See Securities Exchange Act Release No. 73639 significant systems failures to the list of 5 See Securities Exchange Act Release No. 73639 (November 19, 2014), 79 FR 72252 (December 5, scenarios that may trigger an operational 2014) (Regulation Systems Compliance and (November 19, 2014), 79 FR at 72252 (December 5, 2014) (Regulation Systems Compliance and switch to C2’s back-up data center is Integrity) (File No. S7–01–13). 4 See Securities Exchange Act Release No. 67357 Integrity) (File No. S7–01–13). intended to more accurately reflect the (July 5 2012), 77 FR 40928 (July 11, 2012) (SR–C2– 6 17 CFR 242.1001(a)(2)(v). realities of electronic trading 2012–011). 7 Id. at § 242.1004. environments and contemporary threats VerDate Sep<11>2014 17:00 Nov 03, 2015 Jkt 238001 PO 00000 Frm 00053 Fmt 4703 Sfmt 4703 E:\FR\FM\04NON1.SGM 04NON1

Federal Register / Vol. 80, No. 213 / Wednesday, November 4, 2015 / Notices 68345 posed to the operation of fair and Proposed Rule 6.45(b)(iv) (Trading standards by which a market participant orderly markets. In addition to the Permit Holder Participation) regarding might be determined to be a Designated reformulation of the description of C2’s testing of C2’s back-up data center BCP/DR Participant would be applied back-up data center, proposed Rule would contain provisions similar to prospectively with reasonable advance 6.45(b) would also contain subsections current Rule 6.45(d) (Trading Permit notice as announced via Regulatory similar to the notice, applicable rules, Holder Preparations), but add Circular. C2 would first announce the and Trading Permit Holder (‘‘TPH’’) subparagraphs to more clearly articulate criteria by which market participants preparations provisions currently C2’s authority to conduct testing of its would be determined to be Designated contained in Rules 6.45(b) through (d). back-up data center systems. Thus, BCP/DR Participants by November 1, Proposed Rule 6.45(b)(i) (Back-up similar to current Rule 6.45(d), 2015. Data Center Functionality), would make proposed Rule 6.45(b)(iv) would C2 has attempted to model the clear the functional and performance provide that TPHs are required to take provisions of proposed Rule standards that the back-up data center appropriate actions as instructed by C2 6.45(b)(iv)(A) based on provisions of must be reasonably designed to achieve. to accommodate C2’s ability to trade Regulation SCI, which require C2 to Specifically, proposed Rule 6.45(b)(i) options via the back-up data center. C2 establish standards for the designation would provide that C2 maintains a back- also proposes changing the rule text in of those members or participants that C2 up data center that C2 has determined proposed Rule 6.45(b)(iv) to provide reasonably determines are, taken as a is reasonably designed to achieve that TPHs are required to take whole, the minimum number of prompt resumption of systems appropriate actions as instructed by C2 members or participants necessary for consistent with Regulation SCI. to accommodate C2’s ability to conduct the maintenance of fair and orderly Proposed Rule 6.45(b)(i) would also business via the back-up data center, markets in the event of the activation of provide that nothing in the provisions of rather than solely to accommodate C2’s its business continuity and disaster proposed Rule 6.45(b) shall be ability to trade options. Under the recovery plans.9 Also consistent with interpreted to require C2 to develop or proposed rule change, the title of Regulation SCI, proposed Rule maintain a back-up data center designed current Rule 6.45(d) (Trading Permit 6.45(b)(iv)(B) (Fair and Orderly Market to fully replicate the capacity, latency, Holder Preparations) would also be Conditions) would make clear that and other features of the primary data changed in proposed Rule 6.45(b)(iv) nothing in proposed Rule 6.45(b) would center. This statement attempts to make (Trading Permit Holder Participation) to require C2 to assume that average levels clear that in order to preserve C2’s better describe the purpose of the rule of liquidity, depth, or other ability to conduct business in the event provisions. characteristics of a usual trading session C2’s primary data center becomes must be present in order to achieve a Subsections (A) through (C) under fair and orderly market in the event of inoperable or otherwise unavailable for proposed Rule 6.45(b)(iv) are designed use, C2 must maintain a back-up data the activation of C2’s business to harmonize C2’s back-up data center continuity and disaster recovery center that is reasonably designed testing rules with certain provisions of achieve resumption of systems plans.10 Regulation SCI. Under proposed Rule Proposed Rule 6.45(b)(iv)(C) (Business consistent with Regulation SCI during a 6.45(b)(iv)(A) (Designated BCP/DR significant systems failure, disaster or Continuity and Disaster Recovery Plans Participants), C2 shall designate those Testing), would provide that C2 shall other unusual circumstances, rather Trading Permit Holders that the C2 than replicate C2’s primary data center require Designated BCP/DR Participants reasonably determines are, taken as a and may require other market systems. C2 believes that the standards whole, the minimum necessary for the set forth in proposed Rule 6.45(b)(i) are participants to participate in scheduled maintenance of fair and orderly markets business continuity and disaster reasonable to help ensure the in the event of the activation of the C2’s maintenance of fair and orderly markets recovery plans tests in the manner and business continuity and disaster frequency prescribed by C2. Proposed in the event of a significant systems recovery plans (‘‘Designated BCP/DR failure, disaster or other unusual Rule 6.45(b)(iv)(C) would set forth C2’s Participants’’). Designated BCP/DR authority to conduct testing of its circumstances and are consistent with Participants will include: (1) All C2 provisions in the release language of business continuity and disaster Market-Makers and; (2) all C2 Trading recovery plans and obtain assistance Regulation SCI.8 Permit Holders connected to the C2 Proposed Rule 6.45(b)(ii) (Notice), from Designated BCP/DR Participants primary data center and transacting and other market participants in would be similar to current Rule 6.45(b) non-Participant customer business, and provide that prior to commencing conducting such tests. C2 notes that the unless a C2 Trading Permit Holder, provisions of proposed Rule trading on the back-up data center, C2 other than a C2 Market-Maker, can shall announce publicly the classes that 6.45(b)(iv)(C) are consistent with C2’s demonstrate ready access to the back-up current rules 11 as well as provisions of will be available for trading. Proposed data center through another C2 Trading Rule 6.45(b)(iii) (Applicable Rules) Regulation SCI pertaining to business Permit Holder that is a designated continuity and disaster recovery plan would provide that in the event the participant. C2 has reasonably primary data center becomes inoperable, testing.12 Proposed Rule determined that a C2 TPH, other than a 6.45(b)(iv)(C)(1) (Documentation and trading will continue using the back-up C2 Market-Maker, who can demonstrate data center and all trading rules will Reports), would provide that C2 may ready-access to the back-up data center require Designated BCP/DR Participants remain in effect. Consistent with current through another C2 Trading Permit asabaliauskas on DSK5VPTVN1PROD with NOTICES Rule 6.45(c), the proposed rule would Holder, that is a designated participant, 9 See 17 CFR 242.1004(a)–(b). also contain the provisions that all non- is not necessary for the maintenance of 10 See Securities Exchange Act Release No. 73639 trading rules of C2 shall continue to fair and orderly markets in the event of (November 19, 2014), 79 FR at 72353 (December 5, apply. the activation of the C2’s business 2014) (Regulation Systems Compliance and Integrity) (File No. S7–01–13). 8 See Securities Exchange Act Release No. 73639 continuity and disaster recovery plans. 11 See Rules 6.34 (Participant Electronic (November 19, 2014), 79 FR at 72353 (December 5, Criteria for designating BCP/DR Connectivity); 6.45(d) (Trading Permit Holder 2014) (Regulation Systems Compliance and participants will be announced prior via Preparations). Integrity) (File No. S7–01–13). Regulatory Circular. Any changes to the 12 See 17 CFR 242.1004(a)–(b). VerDate Sep<11>2014 17:00 Nov 03, 2015 Jkt 238001 PO 00000 Frm 00054 Fmt 4703 Sfmt 4703 E:\FR\FM\04NON1.SGM 04NON1

68346 Federal Register / Vol. 80, No. 213 / Wednesday, November 4, 2015 / Notices and/or other market participants to the most fundamental sense by helping III. Date of Effectiveness of the provide documentation and reports to ensure that a fair and orderly market Proposed Rule Change and Timing for regarding tests conducted pursuant to will exist at a time when such a market Commission Action Rule 6.45, including related data and may be most needed. Because the proposed rule change information, as may be requested by C2, C2 also believes that the proposed does not (i) significantly affect the and in the manner and frequency protection of investors or the public rule change promotes just and equitable prescribed by C2. Proposed Rule interest; (ii) impose any significant principles of trade by adding detail and 6.45(b)(iv)(C)(2) (Notice), would provide burden on competition; and (iii) become that C2 will provide reasonable prior clarity to the Rules. The proposed rule change seeks to provide additional operative for 30 days from the date on notice of scheduled business continuity which it was filed, or such shorter time and disaster recovery plans tests to clarity to C2’s disaster recovery rules, putting all market participants on notice as the Commission may designate if Trading Permit Holders, which notice consistent with the protection of shall describe the general nature of the as to how C2 will function in case of investors and the public interest, the test(s) and identify the Trading Permit significant systems disruption or other proposed rule change has become Holders required to participate and shall disaster situation. C2 is continuously effective pursuant to Section 19(b)(3)(A) be announced via Regulatory Circular. updating the Rules to provide additional of the Act 17 and Rule 19b–4(f)(6) detail, clarity, and transparency 2. Statutory Basis thereunder.18 regarding its operations and trading A proposed rule change filed under C2 believes the proposed rule change systems and regulatory authority. C2 Rule 19b–4(f)(6) 19 normally does not is consistent with the Act and the rules believes that the adoption of detailed, become operative for 30 days after the and regulations thereunder applicable to clear, and transparent rules reduces date of filing. However, pursuant to C2 and, in particular, the requirements burdens on competition and promotes Rule 19b–4(f)(6)(iii) 20 the Commission of Section 6(b) of the Act 13 and just and equitable principles of trade. C2 may designate a shorter time if such Regulation SCI.14 Specifically, C2 also believes that adding greater detail action is consistent with the protection believes the proposed rule change is to the Rules regarding C2’s ability to of investors and the public interest. consistent with the Section 6(b)(5) 15 ensure the continuous operation of the The Exchange has asked the requirements that the rules of an market and preserve the ability to Commission to waive the 30-day exchange be designed to prevent conduct business on C2 will increase operative delay so that the proposal may fraudulent and manipulative acts and confidence in the markets and become operative immediately upon practices, to promote just and equitable encourage wider participation in the filing. According to the Exchange, the principles of trade, to foster cooperation markets and greater investment. Finally, proposed rule change does not present and coordination with persons engaged C2 notes that proposed Rule 6.45 is any novel or substantive issues. The in regulating, clearing, settling, designed to harmonize C2’s disaster proposed rule change is substantially processing information with respect to, recovery rules with Regulation SCI the same as CBOE Rule 6.18,21 except and facilitating transactions in under the Act. for provisions relating to the loss of a securities, to remove impediments to trading floor and the specific factors for and perfect the mechanism of a free and B. Self-Regulatory Organization’s designating BCP/DR Participants. The open market and a national market Statement on Burden on Competition Commission notes that C2 does not have system, and, in general, to protect a trading floor and further, that the investors and the public interest. C2 does not believe that the proposed factors proposed by C2 are those that C2 Additionally, C2 believes the proposed rule change will impose any burden on reasonably determined are, taken as a rule change is consistent with the competition that is not necessary or whole, the minimum necessary for the Section 6(b)(5) 16 requirement that the appropriate in furtherance of the maintenance of fair and orderly markets rules of an exchange not be designed to purposes of the Act. Rather, the in the event of the activation of the permit unfair discrimination between proposed rule change will help ensure Exchange’s business continuity and customers, issuers, brokers, or dealers. that competitive markets remain disaster recovery plans. These factors In particular, the proposed rule operative in the event of a systems are designed to harmonize C2’s rule change is designed to promote C2’s failure or other disaster event. C2 notes with Regulation SCI. Accordingly, the ability to ensure the continued that the proposed rule change is operation of a fair and orderly market in designed to clarify C2’s authority to 17 15 U.S.C. 78s(b)(3)(A). the event of a systems failure, disaster, require market participants to 18 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– or other unusual circumstances that participate in, and provide necessary 4(f)(6)(iii) requires the Exchange to give the Commission written notice of the Exchange’s intent might threaten the ability to conduct liquidity to ensure fair and orderly to file the proposed rule change, along with a brief business on C2. C2 recognizes that markets. C2 further notes that the description and text of the proposed rule change, switching operations to the back-up data proposed rule change is designed to at least five business days prior to the date of filing center may occur in times of uncertainty of the proposed rule change, or such shorter time ensure competitive markets in that it is as designated by the Commission. The Commission or great volatility in the markets. It is at designed around the mandates of deems this requirement to have been met. these times that the investors may have Regulation SCI, which each of the 19 17 CFR 240.19b–4(f)(6). the greatest need for viable, trustworthy national securities exchanges is required 20 17 CFR 240.19b–4(f)(6)(iii). marketplaces. The proposed rule to satisfy. 21 CBOE Rule 6.18 was recently amended in asabaliauskas on DSK5VPTVN1PROD with NOTICES changes seek to ensure that such a CBOE–2015–088, which was filed on October 8, C. Self-Regulatory Organization’s 2015, and effective upon filing. See Securities marketplace will exist when most Exchange Act Release No. 76203 (October 20, 2015), needed. Accordingly, C2 believes that Statement on Comments on the 80 FR 65258 (October 26, 2015). In CBOE–2015– the proposed rule protects investors in Proposed Rule Change Received From 088, CBOE amended CBOE Rule 6.18 to further Members, Participants, or Others describe CBOE’s back-up systems, the 13 15 circumstances under which they may be used, and U.S.C. 78f(b). the testing that CBOE may conduct to ensure the 14 See 17 CFR 242.1001(a) and 1004. The Exchange neither solicited nor availability, functionality and performance of such 15 15 U.S.C. 78f(b)(5). received comments on the proposed systems, as well incorporate provisions for 16 Id. rule change. Regulation SCI. VerDate Sep<11>2014 17:00 Nov 03, 2015 Jkt 238001 PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 E:\FR\FM\04NON1.SGM 04NON1

Federal Register / Vol. 80, No. 213 / Wednesday, November 4, 2015 / Notices 68347 Commission believes that waiving the provisions of 5 U.S.C. 552, will be 2015, BX granted an extension of time 30-day operative delay is consistent available for Web site viewing and for Commission action until October 30, with the protection of investors and the printing in the Commission’s Public 2015. On October 23, 2015, BX filed public interest as it will allow the Reference Room, 100 F Street NE., Amendment No. 2 to the proposal.5 The Exchange to incorporate changes Washington, DC 20549 on official Commission is publishing this notice to required under Regulation SCI, such as business days between the hours of solicit comment on Amendment No. 2 establishing standards for designating 10:00 a.m. and 3:00 p.m. Copies of such from interested persons and is BCP/DR Participants, prior to the filing also will be available for approving the proposed rule change, as November 3, 2015 compliance date. inspection and copying at the principal modified by Amendment Nos. 1 and 2, Therefore, the Commission designates office of the Exchange. All comments on an accelerated basis, with certain the proposed rule change to be operative received will be posted without change; provisions subject to a pilot period upon filing.22 the Commission does not edit personal scheduled to expire on July 18, 2016. At any time within 60 days of the identifying information from filing of the proposed rule change, the submissions. You should submit only II. Description of the Proposal Commission summarily may information that you wish to make BX proposes to establish a price- temporarily suspend such rule change if available publicly. All submissions improvement mechanism, ‘‘PRISM,’’ on it appears to the Commission that such should refer to File Number SR–C2– the Exchange’s options platform, in action is necessary or appropriate in the 2015–030, and should be submitted on which a BX Participant (an ‘‘Initiating public interest, for the protection of or before November 25, 2015. Participant’’) may electronically submit investors, or otherwise in furtherance of For the Commission, by the Division of for execution a two-sided paired order, the purposes of the Act. Trading and Markets, pursuant to delegated where one side is an order it represents IV. Solicitation of Comments authority.23 as agent on behalf of a Public Robert W. Errett, Customer,6 Professional customer, Interested persons are invited to broker-dealer, or any other entity Deputy Secretary. submit written data, views, and (‘‘PRISM Order’’) and the other side is [FR Doc. 2015–28023 Filed 11–3–15; 8:45 am] arguments concerning the foregoing, principal interest or any other order it BILLING CODE 8011–01–P including whether the proposed rule represents as agent (an ‘‘Initiating change is consistent with the Act. Order’’) provided that the member first Comments may be submitted by any of exposes the PRISM Order in the PRISM SECURITIES AND EXCHANGE the following methods: Auction (‘‘Auction’’) pursuant to the COMMISSION Electronic Comments proposed Rule. [Release No. 34–76301; File No. SR–BX– • Use the Commission’s Internet 2015–032] as a comment letter to the file to promote the public comment form (http://www.sec.gov/ dissemination of its Amendment). rules/sro.shtml); or Self-Regulatory Organizations; 5 In Amendment No. 2, BX makes certain • Send an email to rule-comments@ NASDAQ OMX BX, Inc.; Notice of Filing technical and clarifying changes to the proposal, sec.gov. Please include File Number SR– of Amendment No. 2 and Order which BX believes does not result in any material C2–2015–030 on the subject line. Granting Accelerated Approval of a differences over its original filing as modified by Amendment No. 1. Specifically, BX proposes to: (i) Proposed Rule Change, as Modified by Paper Comments Amendment Nos. 1 and 2, To Adopt a Remove the term ‘‘displayed’’; (ii) describe ‘‘rejected’’ orders more accurately as ‘‘immediately • Send paper comments in triplicate New Price Improvement Auction, BX cancelled’’ in certain circumstances; (iii) provide to Brent J. Fields, Secretary, Securities PRISM more specificity as to the amounts of allocations for and Exchange Commission, 100 F Street which an Initiating Participant is entitled to be October 29, 2015. allocated; (iv) remove an incorrect reference to NE., Washington, DC 20549–1090. ‘‘orders’’ and define interest more specifically; (v) All submissions should refer to File I. Introduction add more specificity related to Customer-to- Number SR–C2–2015–030. This file Customer orders; (vi) correct a citation error; and On August 19, 2015, NASDAQ OMX (vii) correct typographical errors. Amendment 2 number should be included on the BX, Inc. (‘‘BX’’ or ‘‘Exchange’’) filed amends and replaces the original filing, as modified subject line if email is used. To help the with the Securities and Exchange by Amendment 1, in its entirety. To promote Commission process and review your Commission (‘‘Commission’’), pursuant transparency of its proposed amendment, when BX comments more efficiently, please use filed Amendment No. 2 with the Commission, it to Section 19(b)(1) of the Securities also submitted Amendment No. 2 as a comment only one method. The Commission will Exchange Act of 1934 (‘‘Act’’) 1 and Rule letter to the file, which the Commission posted on post all comments on the Commission’s 19b–4 thereunder,2 a proposed rule its Web site and placed in the public comment file Internet Web site (http://www.sec.gov/ change to establish an options price for SR–BX–2015–032. The Exchange also posted a rules/sro.shtml). Copies of the copy of its Amendment No. 2 on its Web site when improvement mechanism (‘‘PRISM’’). it filed the amendment with the Commission. submission, all subsequent On September 2, 2015, BX filed 6 For purposes of this Rule, a Public Customer amendments, all written statements Amendment No. 1 to the proposal. The order does not include a Professional order, and with respect to the proposed rule proposed rule change, as modified by therefore a Professional would not be entitled to change that are filed with the Amendment No. 1, was published for Public Customer priority as described herein. A Commission, and all written Public Customer means a person that is not a broker comment in the Federal Register on or dealer in securities. See BX Chapter I, Section communications relating to the September 10, 2015.3 The Commission 1(a)(50). A Public Customer order does not include proposed rule change between the received no substantive comments asabaliauskas on DSK5VPTVN1PROD with NOTICES a Professional order for purposes of BX Chapter VI, Commission and any person, other than regarding the proposal.4 On October 22, Section 10(a)(C)(1)(a), which governs allocation those that may be withheld from the priority. A ‘‘Professional’’ means any person or entity that (i) is not a broker or dealer in securities, public in accordance with the 23 17 CFR 200.30–3(a)(12). and (ii) places more than 390 orders in listed 1 15 U.S.C. 78s(b)(1). options per day on average during a calendar month 22 For purposes only of waiving the 30-day 2 17 CFR 240.19b–4. for its own beneficial account(s). A Participant or operative delay, the Commission has also 3 See Securities Exchange Act Release No. 75827 a Public Customer may, without limitation, be a considered the proposed rule’s impact on (September 3, 2015), 80 FR 54601 (‘‘Notice’’). Professional. All Professional orders shall be efficiency, competition, and capital formation. See 4 See infra note 5 (noting that when BX submitted appropriately marked by Participants. See BX 15 U.S.C. 78c(f). Amendment No. 2, it also submitted the document Chapter I, Section 1(a)(49). VerDate Sep<11>2014 17:00 Nov 03, 2015 Jkt 238001 PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 E:\FR\FM\04NON1.SGM 04NON1


Document Created: 2018-03-01 11:28:07
Document Modified: 2018-03-01 11:28:07
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 68343 
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