80 FR 70036 - Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Adopt Business Continuity and Disaster Recovery Plans Testing Requirements
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 218 (November 12, 2015)
Federal Register Volume 80, Issue 218 (November 12, 2015)
| Page Range | 70036-70039 | |
| FR Document | 2015-28698 |
[Federal Register Volume 80, Number 218 (Thursday, November 12, 2015)] [Notices] [Pages 70036-70039] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-28698] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-76370; File No. SR-Phlx-2015-90] Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Adopt Business Continuity and Disaster Recovery Plans Testing Requirements November 5, 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 November 2, 2015, NASDAQ OMX PHLX LLC (``Phlx'' or ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``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. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to adopt business continuity and disaster recovery plans (``BC/DR Plans'') testing requirements for certain Exchange Member Organizations \3\ and PSX Participants \4\ (``Participants'') in [[Page 70037]] connection with Regulation Systems Compliance and Integrity (``Regulation SCI'').\5\ --------------------------------------------------------------------------- \3\ The term ``Member Organization'' is defined as ``a corporation, partnership (general or limited), limited liability partnership, limited liability company, business trust or similar organization, transacting business as a broker or a dealer in securities and which has the status of a member organization by virtue of (i) admission to membership given to it by the Membership Department pursuant to the provisions of Rules 900.1 or 900.2 or the By-Laws or (ii) the transitional rules adopted by the Exchange pursuant to Section 6-4 of the By-Laws. References herein to officer or partner, when used in the context of a member organization, shall include any person holding a similar position in any organization other than a corporation or partnership that has the status of a member organization.'' See Exchange Rule 1(o). \4\ The term ``PSX Participant'' or ``Participant'' is defined as ``an entity that fulfills the obligations contained in Rule 3211 regarding participation in the System, and includes: (1) `Equities ECNs,' which are member organizations that meet all of the requirements of Rule 3223, and that participate in the System with respect to one or more System Securities; (2) `PSX Market Makers' or `Market Makers', member organizations that are registered as PSX Market Makers for purposes of participation in the System on a fully automated basis with respect to one or more System securities; and (3) `Order Entry Firms,' which are member organizations that are registered for the purposes of entering orders in System Securities into the System. This term shall also include any Electronic Communications Network or Alternative Trading System (as such terms are defined in Regulation NMS) that fails to meet all the requirements of Rule 3223.'' See PSX Rule 3301(c). \5\ See Securities Exchange Act Release No. 73639 (November 19, 2014), 79 FR 72252 (December 5, 2014) (``SCI Adopting Release''). --------------------------------------------------------------------------- The text of the proposed rule change is available on the Exchange's Web site at http://nasdaqomxphlx.cchwallstreet.com/, at the principal office of the Exchange, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange is proposing to adopt new Rule 926 to implement the BC/DR Plans requirements of Rule 1004 of Regulation SCI. As adopted by the Commission, Regulation SCI applies to certain self-regulatory organizations (including the Exchange), alternative trading systems (``ATSs''), plan processors, and exempt clearing agencies (collectively, ``SCI entities''), and will require these SCI entities to comply with requirements with respect to the automated systems central to the performance of their regulated activities. Among the requirements of Regulation SCI is Rule 1001(a)(2)(v), which requires the Exchange and other SCI entities to maintain ``[b]usiness continuity and disaster recovery plans that include maintaining backup and recovery capabilities sufficiently resilient and geographically diverse and that are reasonably designed to achieve next business day resumption of trading and two-hour resumption of critical SCI systems following a wide-scale disruption.'' \6\ The Exchange has put extensive time and resources toward planning for system failures and already maintains robust BC/DR Plans consistent with the Rule. As set forth below, in connection with Regulation SCI, the Exchange is proposing to require certain Member Organizations and Participants to participate in testing of the operation of the Exchange's BC/DR Plans. --------------------------------------------------------------------------- \6\ 17 CFR 242.1001(a)(2)(v). --------------------------------------------------------------------------- With respect to an SCI entity's BC/DR Plans, including its backup systems, paragraph (a) of Rule 1004 of Regulation SCI requires each SCI entity to: ``[e]stablish standards for the designation of those members or participants that the SCI entity 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 such plans.'' \7\ Paragraph (b) of Rule 1004 of Regulation SCI further requires each SCI entity to ``[d]esignate members or participants pursuant to the standards established in paragraph (a) of [Rule 1004] and require participation by such designated members or participants in scheduled functional and performance testing of the operation of such plans, in the manner and frequency specified by the SCI entity, provided that such frequency shall not be less than once every 12 months.'' \8\ In order to comply with Rule 1004 of Regulation SCI, the Exchange proposes to adopt new Rule 926, which incorporates the requirements of Rule 1004 of Regulation SCI as part of the Exchange's rules, and sets forth the notice, selection criteria and obligations of Member Organizations and Participants with respect to BC/DR Plans testing. --------------------------------------------------------------------------- \7\ 17 CFR 242.1004(a). \8\ 17 CFR 242.1004(b). --------------------------------------------------------------------------- The Exchange proposes to adopt Rule 926(a), which will set forth the Exchange's obligations with respect to the selection of Members Organizations and Participants for testing. Specifically, the rule will require the Exchange to ``[e]stablish standards for the designation of those Members Organizations and Participants that the Exchange 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 such plans.'' The proposed new rule further provides that ``[s]uch standards may include volume-based and/or market share-based criteria, and may be adjusted from time to time by the Exchange.'' Lastly, the proposed new rule will require the Exchange to provide public notice of the standards that it adopts. The Exchange is proposing to adopt Rule 926(b), which will set forth the obligations of the Exchange and its Members Organizations and Participants with respect to testing. Specifically, the rule will require the Exchange to ``designate Members Organizations and PSX Participants pursuant to the standards established in paragraph (a) of this rule and require participation by such designated Members Organizations and PSX Participants in scheduled functional and performance testing of the operation of such plans, in the manner and frequency specified by the Exchange, provided that such frequency shall not be less than once every 12 months.'' Moreover, the rule will require the Exchange to provide at least six months prior notice to Members Organizations and Participants that are designated for mandatory testing. Lastly, the rule will provide notice that participation in testing is a condition of membership for Members Organizations and Participants that are designated for testing. The Exchange encourages all Member Organizations and Participants to connect to the Exchange's backup systems and to participate in testing of such systems; \9\ however, certain Member Organizations and Participants will be obligated to participate in BC/DR Plans testing. In adopting new Rule 926, the Exchange will require mandatory participation in BC/DR Plans testing by those Member Organizations and Participants that the Exchange 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 such plans on the Exchange and PSX, respectively. The Exchange believes that using overall participation on its [[Page 70038]] markets (by volume and/or market share) as a measure to select Member Organizations and Participants for mandatory participation in BC/DR Plans testing is a reasonable means by which it can determine which Member Organizations and Participants are necessary for the maintenance of fair and orderly markets in the event of the activation of such plans.\10\ For each BC/DR Plans test cycle, the Exchange will select the top ten Member Organizations on the Exchange and the top five Participants on PSX based on the Exchange's measure of overall participation on each of those markets. All notices concerning BC/DR Plans testing will be posted on the Exchange's Web site. --------------------------------------------------------------------------- \9\ In this regard, the Exchange will allow any Member Organization or Participant to participate in the testing of the Exchange's BC/DR Plans, which is consistent with the Plan. See SCI Adopting Release, supra note 5 at 72350. The Exchange will provide instructions on how a Member Organization and Participant must inform the Exchange of its interest in participating in an upcoming BC/DR Plans test via the announcement of the test date. A Member Organization or Participant must provide the Exchange notice of its interest to participate at least a week prior to the test date and must have the appropriate connection for testing in place. \10\ The Exchange will provide notice of the specific selection criteria and measurement period in a notice to Member Organizations and Participants. The initial selection criteria and measurement period will be announced no later than November 3, 2015. --------------------------------------------------------------------------- The Exchange is proposing to initially select Member Organizations and Participants with the highest levels of trading volume on the Exchange and PSX over four calendar months (``Measurement Period'') as mandatory testing Member Organizations and Participants, respectively.\11\ Specifically, the Measurement Period will be the four calendar months of trading immediately prior to the Exchange's announcement of the next BC/DR Plans test date. The Measurement Period will always begin at a point after the Exchange announces the criteria to be used in the next BC/DR Plans test. By way of example, if on October 6, 2017 the Exchange announced the BC/DR Plans test selection criteria and on March 2, 2018 the Exchange announced a BC/DR Plans test date of September 8, 2018, the Measurement Period used to select Member Organizations and Participants subject to mandatory testing would be November 2017 through February 2018. Members Organizations and Participants not obligated to participate that wish to participate in this test must inform the Exchange no later than September 1, 2018.\12\ --------------------------------------------------------------------------- \11\ The Exchange may change the total number of Member Organizations and Participants selected from time to time. \12\ See note 9. --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6 of the Act,\13\ in general, and further the objectives of Section 6(b)(5) of the Act,\14\ in particular, in that it is 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; and are not designed to permit unfair discrimination between customers, issuers, brokers, or dealers. The proposal will ensure that the Member Organizations and Participants necessary to ensure the maintenance of fair and orderly markets are properly designated consistent with Rule 1004 of Regulation SCI. Specifically, the proposal will adopt clear and objective criteria with respect to the designation of Member Organizations and Participants that are required to participate in the testing of the Exchange's BC/DR Plans, as well as appropriate notification regarding such designation. As set forth in the SCI Adopting Release, ``SROs have the authority, and legal responsibility, under Section 6 of the Exchange Act, to adopt and enforce rules (including rules to comply with Regulation SCI's requirements relating to BC/DR testing) applicable to their members or participants that are designed to, among other things, 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.'' \15\ The Exchange believes that this proposal is consistent with such authority and legal responsibility. --------------------------------------------------------------------------- \13\ 15 U.S.C. 78f. \14\ 15 U.S.C. 78f(b)(5). \15\ See SCI Adopting Release, supra note 5 at 72350. --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act, as amended. To the contrary, the proposal is not a competitive proposal but rather is necessary for the Exchange's compliance with Regulation SCI. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act \16\ and Rule 19b-4(f)(6)(iii) thereunder.\17\ 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 prior to 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 and Rule 19b- 4(f)(6)(iii) thereunder.\18\ A proposed rule change filed under Rule 19b-4(f)(6)(iii) \19\ normally does not become operative prior to 30 days after the date of the 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. --------------------------------------------------------------------------- \16\ 15 U.S.C. 78s(b)(3)(A)(iii). \17\ 17 CFR 240.19b-4(f)(6). \18\ In addition, Rule 19b-4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intent to file the proposed rule change at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. \19\ 17 CFR 240.19b-4(f)(6). \20\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The 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 BC/DR participants, prior to the November 3, 2015 compliance date. Accordingly, the Commission designates the proposed rule change to be operative upon filing.\21\ --------------------------------------------------------------------------- \21\ 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). --------------------------------------------------------------------------- At any time within 60 days of the filing of the proposed rule change, the [[Page 70039]] Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to rule-comments@sec.gov. Please include File Number SR-Phlx-2015-90 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-Phlx-2015-90. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-Phlx-2015-90 and should be submitted on or before December 3, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\22\ --------------------------------------------------------------------------- \22\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2015-28698 Filed 11-10-15; 8:45 am] BILLING CODE 8011-01-P
![70036 Federal Register / Vol. 80, No. 218 / Thursday, November 12, 2015 / Notices
assessed the same fee, except it appears to the Commission that such NASDAQ–2015–127, and should be
Customers. Customer order flow is action is: (i) Necessary or appropriate in submitted on or before December 3,
unique in that it enhances liquidity on the public interest; (ii) for the protection 2015.
the Exchange for the benefit of all of investors; or (iii) otherwise in For the Commission, by the Division of
market participants and benefits all furtherance of the purposes of the Act. Trading and Markets, pursuant to delegated
market participants by providing more If the Commission takes such action, the authority.22
trading opportunities, which attracts Commission shall institute proceedings Robert W. Errett,
market makers. to determine whether the proposed rule Deputy Secretary.
The elimination of the SPY Fees for should be approved or disapproved.
[FR Doc. 2015–28683 Filed 11–10–15; 8:45 am]
Removing Liquidity in Penny Pilot
IV. Solicitation of Comments BILLING CODE 8011–01–P
Options does not create an intra-market
undue burden on competition because Interested persons are invited to
all Penny Pilot Options will be assessed submit written data, views, and
arguments concerning the foregoing, SECURITIES AND EXCHANGE
the same [sic] as the Fees for Removing COMMISSION
Liquidity. including whether the proposed rule
The Exchange’s proposal to remove change is consistent with the Act. [Release No. 34–76370; File No. SR–Phlx–
note ‘‘d’’ of Chapter XV, Section 2(1) Comments may be submitted by any of 2015–90]
does not create an intra-market undue the following methods:
burden on competition because this Self-Regulatory Organizations;
Electronic Comments NASDAQ OMX PHLX LLC; Notice of
incentive to reduce certain Fees for
Removing Liquidity in Penny Pilot • Use the Commission’s Internet Filing and Immediate Effectiveness of
Options is no longer relevant as those comment form (http://www.sec.gov/ Proposed Rule Change To Adopt
fees are being reduced in this proposal. rules/sro.shtml); or Business Continuity and Disaster
The Exchange’s proposal to amend • Send an email to rule-comments@ Recovery Plans Testing Requirements
note ‘‘e’’ of Chapter XV, Section 2(1) to sec.gov. Please include File Number SR–
NASDAQ–2015–127 on the subject line. November 5, 2015.
reduce one of the incentives being Pursuant to Section 19(b)(1) of the
offered to Participants that qualify for Paper Comments Securities Exchange Act of 1934
Tier 8 of the Customer and Professional • Send paper comments in triplicate (‘‘Act’’),1 and Rule 19b–4 thereunder,2
Penny Pilot Options Rebates to Add to Brent J. Fields, Secretary, Securities notice is hereby given that on November
Liquidity from an additional $0.05 per and Exchange Commission, 100 F Street 2, 2015, NASDAQ OMX PHLX LLC
contract incentive to $0.03 per contract NE., Washington, DC 20549–1090. (‘‘Phlx’’ or ‘‘Exchange’’) filed with the
does not create an intra-market undue All submissions should refer to File Securities and Exchange Commission
burden on competition because all Number SR–NASDAQ–2015–127. This (‘‘SEC’’ or ‘‘Commission’’) the proposed
Participants may qualify for Tier 8 and file number should be included on the rule change as described in Items I and
the additional incentive. subject line if email is used. To help the II, below, which Items have been
The Exchange’s proposal to amend
Commission process and review your prepared by the Exchange. The
the time period of October 22, 2015
comments more efficiently, please use Commission is publishing this notice to
through October 30, 2015 to ‘‘in a
only one method. The Commission will solicit comments on the proposed rule
month’’ does not create an intra-market
post all comments on the Commission’s change from interested persons.
undue burden on competition because
Internet Web site (http://www.sec.gov/
the amended language is intended to I. Self-Regulatory Organization’s
rules/sro.shtml). Copies of the
capture the entire month going forward Statement of the Terms of Substance of
submission, all subsequent
and was previously intended to reflect the Proposed Rule Change
amendments, all written statements
the effectiveness of a prior rule change. The Exchange proposes to adopt
The remaining renumbering changes with respect to the proposed rule
change that are filed with the business continuity and disaster
do not create an intra-market undue
Commission, and all written recovery plans (‘‘BC/DR Plans’’) testing
burden on competition because the
communications relating to the requirements for certain Exchange
amendments are non-substantive in
proposed rule change between the Member Organizations 3 and PSX
nature.
Commission and any person, other than Participants 4 (‘‘Participants’’) in
C. Self-Regulatory Organization's those that may be withheld from the
22 17 CFR 200.30–3(a)(12).
Statement on Comments on the public in accordance with the
1 15 U.S.C. 78s(b)(1).
Proposed Rule Change Received From provisions of 5 U.S.C. 552, will be 2 17 CFR 240.19b–4.
Members, Participants, or Others available for Web site viewing and 3 The term ‘‘Member Organization’’ is defined as
No written comments were either printing in the Commission’s Public ‘‘a corporation, partnership (general or limited),
solicited or received. Reference Room, 100 F Street NE., limited liability partnership, limited liability
Washington, DC 20549 on official company, business trust or similar organization,
III. Date of Effectiveness of the business days between the hours of transacting business as a broker or a dealer in
Proposed Rule Change and Timing for securities and which has the status of a member
10:00 a.m. and 3:00 p.m. Copies of such organization by virtue of (i) admission to
Commission Action filing also will be available for membership given to it by the Membership
The foregoing rule change has become inspection and copying at the principal Department pursuant to the provisions of Rules
900.1 or 900.2 or the By-Laws or (ii) the transitional
mstockstill on DSK4VPTVN1PROD with NOTICES
effective pursuant to Section office of the Exchange. All comments
rules adopted by the Exchange pursuant to Section
19(b)(3)(A)(ii) of the Act.21 received will be posted without change; 6–4 of the By-Laws. References herein to officer or
At any time within 60 days of the the Commission does not edit personal partner, when used in the context of a member
filing of the proposed rule change, the identifying information from organization, shall include any person holding a
submissions. You should submit only similar position in any organization other than a
Commission summarily may corporation or partnership that has the status of a
temporarily suspend such rule change if information that you wish to make member organization.’’ See Exchange Rule 1(o).
available publicly. All submissions 4 The term ‘‘PSX Participant’’ or ‘‘Participant’’ is
21 15 U.S.C. 78s(b)(3)(A)(ii). should refer to File Number SR– defined as ‘‘an entity that fulfills the obligations
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connection with Regulation Systems maintain ‘‘[b]usiness continuity and and orderly markets in the event of the
Compliance and Integrity (‘‘Regulation disaster recovery plans that include activation of such plans.’’ The proposed
SCI’’).5 maintaining backup and recovery new rule further provides that ‘‘[s]uch
The text of the proposed rule change capabilities sufficiently resilient and standards may include volume-based
is available on the Exchange’s Web site geographically diverse and that are and/or market share-based criteria, and
at http:// reasonably designed to achieve next may be adjusted from time to time by
nasdaqomxphlx.cchwallstreet.com/, at business day resumption of trading and the Exchange.’’ Lastly, the proposed
the principal office of the Exchange, and two-hour resumption of critical SCI new rule will require the Exchange to
at the Commission’s Public Reference systems following a wide-scale provide public notice of the standards
Room. disruption.’’ 6 The Exchange has put that it adopts.
extensive time and resources toward The Exchange is proposing to adopt
II. Self-Regulatory Organization’s planning for system failures and already Rule 926(b), which will set forth the
Statement of the Purpose of, and maintains robust BC/DR Plans obligations of the Exchange and its
Statutory Basis for, the Proposed Rule consistent with the Rule. As set forth Members Organizations and Participants
Change below, in connection with Regulation with respect to testing. Specifically, the
In its filing with the Commission, the SCI, the Exchange is proposing to rule will require the Exchange to
Exchange included statements require certain Member Organizations ‘‘designate Members Organizations and
concerning the purpose of and basis for and Participants to participate in testing PSX Participants pursuant to the
the proposed rule change and discussed of the operation of the Exchange’s BC/ standards established in paragraph (a) of
any comments it received on the DR Plans. this rule and require participation by
proposed rule change. The text of these With respect to an SCI entity’s BC/DR such designated Members Organizations
statements may be examined at the Plans, including its backup systems, and PSX Participants in scheduled
places specified in Item IV below. The paragraph (a) of Rule 1004 of Regulation functional and performance testing of
Exchange has prepared summaries, set SCI requires each SCI entity to: the operation of such plans, in the
forth in sections A, B, and C below, of ‘‘[e]stablish standards for the manner and frequency specified by the
the most significant aspects of such designation of those members or Exchange, provided that such frequency
statements. participants that the SCI entity shall not be less than once every 12
reasonably determines are, taken as a months.’’ Moreover, the rule will
A. Self-Regulatory Organization's whole, the minimum necessary for the
Statement of the Purpose of, and require the Exchange to provide at least
maintenance of fair and orderly markets six months prior notice to Members
Statutory Basis for, the Proposed Rule in the event of the activation of such
Change Organizations and Participants that are
plans.’’ 7 Paragraph (b) of Rule 1004 of designated for mandatory testing. Lastly,
1. Purpose Regulation SCI further requires each SCI the rule will provide notice that
entity to ‘‘[d]esignate members or participation in testing is a condition of
The Exchange is proposing to adopt participants pursuant to the standards
new Rule 926 to implement the BC/DR membership for Members Organizations
established in paragraph (a) of [Rule and Participants that are designated for
Plans requirements of Rule 1004 of 1004] and require participation by such
Regulation SCI. As adopted by the testing.
designated members or participants in The Exchange encourages all Member
Commission, Regulation SCI applies to scheduled functional and performance
certain self-regulatory organizations Organizations and Participants to
testing of the operation of such plans, in connect to the Exchange’s backup
(including the Exchange), alternative the manner and frequency specified by
trading systems (‘‘ATSs’’), plan systems and to participate in testing of
the SCI entity, provided that such such systems; 9 however, certain
processors, and exempt clearing frequency shall not be less than once
agencies (collectively, ‘‘SCI entities’’), Member Organizations and Participants
every 12 months.’’ 8 In order to comply will be obligated to participate in BC/DR
and will require these SCI entities to with Rule 1004 of Regulation SCI, the
comply with requirements with respect Plans testing. In adopting new Rule 926,
Exchange proposes to adopt new Rule the Exchange will require mandatory
to the automated systems central to the 926, which incorporates the
performance of their regulated activities. participation in BC/DR Plans testing by
requirements of Rule 1004 of Regulation those Member Organizations and
Among the requirements of Regulation SCI as part of the Exchange’s rules, and
SCI is Rule 1001(a)(2)(v), which requires Participants that the Exchange
sets forth the notice, selection criteria reasonably determines are, taken as a
the Exchange and other SCI entities to and obligations of Member whole, the minimum necessary for the
Organizations and Participants with maintenance of fair and orderly markets
contained in Rule 3211 regarding participation in
the System, and includes: (1) ‘Equities ECNs,’
respect to BC/DR Plans testing. in the event of the activation of such
which are member organizations that meet all of the The Exchange proposes to adopt Rule plans on the Exchange and PSX,
requirements of Rule 3223, and that participate in 926(a), which will set forth the respectively. The Exchange believes that
the System with respect to one or more System Exchange’s obligations with respect to
Securities; (2) ‘PSX Market Makers’ or ‘Market using overall participation on its
Makers’, member organizations that are registered
the selection of Members Organizations
as PSX Market Makers for purposes of participation and Participants for testing. Specifically, 9 In this regard, the Exchange will allow any
in the System on a fully automated basis with the rule will require the Exchange to Member Organization or Participant to participate
respect to one or more System securities; and (3) ‘‘[e]stablish standards for the in the testing of the Exchange’s BC/DR Plans, which
‘Order Entry Firms,’ which are member is consistent with the Plan. See SCI Adopting
organizations that are registered for the purposes of
designation of those Members
Release, supra note 5 at 72350. The Exchange will
mstockstill on DSK4VPTVN1PROD with NOTICES
entering orders in System Securities into the Organizations and Participants that the provide instructions on how a Member
System. This term shall also include any Electronic Exchange reasonably determines are, Organization and Participant must inform the
Communications Network or Alternative Trading taken as a whole, the minimum Exchange of its interest in participating in an
System (as such terms are defined in Regulation upcoming BC/DR Plans test via the announcement
NMS) that fails to meet all the requirements of Rule
necessary for the maintenance of fair
of the test date. A Member Organization or
3223.’’ See PSX Rule 3301(c). Participant must provide the Exchange notice of its
5 See Securities Exchange Act Release No. 73639 6 17 CFR 242.1001(a)(2)(v). interest to participate at least a week prior to the
7 17 CFR 242.1004(a).
(November 19, 2014), 79 FR 72252 (December 5, test date and must have the appropriate connection
2014) (‘‘SCI Adopting Release’’). 8 17 CFR 242.1004(b). for testing in place.
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Commission summarily may information that you wish to make (the ‘‘Equities Fee Schedule’’ and,
temporarily suspend such rule change if available publicly. together with the Options Fee Schedule,
it appears to the Commission that such All submissions should refer to File the ‘‘Fee Schedules’’) to implement fees
action is necessary or appropriate in the Number SR–Phlx–2015–90 and should for the new service. The text of the
public interest, for the protection of be submitted on or before December 3, proposed rule change is available on the
investors, or otherwise in furtherance of 2015. Exchange’s Web site at www.nyse.com,
the purposes of the Act. If the For the Commission, by the Division of at the principal office of the Exchange,
Commission takes such action, the Trading and Markets, pursuant to delegated and at the Commission’s Public
Commission shall institute proceedings authority.22 Reference Room.
to determine whether the proposed rule Robert W. Errett, II. Self-Regulatory Organization’s
should be approved or disapproved. Deputy Secretary. Statement of the Purpose of, and
IV. Solicitation of Comments [FR Doc. 2015–28698 Filed 11–10–15; 8:45 am] Statutory Basis for, the Proposed Rule
BILLING CODE 8011–01–P Change
Interested persons are invited to
submit written data, views, and In its filing with the Commission, the
arguments concerning the foregoing, SECURITIES AND EXCHANGE self-regulatory organization included
including whether the proposed rule COMMISSION statements concerning the purpose of,
change is consistent with the Act. and basis for, the proposed rule change
[Release No. 34–76372; File No. SR– and discussed any comments it received
Comments may be submitted by any of NYSEARCA–2015–105]
the following methods: on the proposed rule change. The text
of those statements may be examined at
Electronic Comments Self-Regulatory Organizations; NYSE
the places specified in Item IV below.
Arca, Inc.; Notice of Filing and
• Use the Commission’s Internet The Exchange has prepared summaries,
Immediate Effectiveness of Proposed set forth in sections A, B, and C below,
comment form (http://www.sec.gov/ Rule Change To Provide That the Co-
rules/sro.shtml); or of the most significant parts of such
Location Services Offered by the statements.
• Send an email to rule-comments@ Exchange Include 40 Gigabit Internet
sec.gov. Please include File Number SR– Protocol Network Connections in the A. Self-Regulatory Organization's
Phlx–2015–90 on the subject line. Exchange’s Data Center and To Amend Statement of the Purpose of, and
Paper Comments the Exchange’s Price List To Statutory Basis for, the Proposed Rule
Implement Fees for the New Services Change
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities November 5, 2015. 1. Purpose
and Exchange Commission, 100 F Street Pursuant to Section 19(b)(1) 1 of the The Exchange proposes to change its
NE., Washington, DC 20549–1090. Securities Exchange Act of 1934 (the rules to provide that the co-location 4
All submissions should refer to File ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 services offered by the Exchange
Number SR–Phlx–2015–90. This file notice is hereby given that, on October include 40 Gb IP network connections
number should be included on the 28, 2015, NYSE Arca, Inc. (the in the Exchange’s data center. The
subject line if email is used. To help the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with Exchange proposes to amend the Fee
Commission process and review your the Securities and Exchange Schedules to implement fees for the
comments more efficiently, please use Commission (the ‘‘Commission’’) the new service effective.
proposed rule change as described in Currently, the Exchange’s co-location
only one method. The Commission will
Items I, II, and III below, which Items services offer Users 5 access to two local
post all comments on the Commission’s
have been prepared by the self- area networks available in the data
Internet Web site (http://www.sec.gov/
regulatory organization. The center: The IP network and the
rules/sro.shtml).
Commission is publishing this notice to Liquidity Center Network (‘‘LCN’’).6 IP
Copies of the submission, all
subsequent amendments, all written solicit comments on the proposed rule
4 The Exchange initially filed rule changes
statements with respect to the proposed change from interested persons.
relating to its co-location services with the
rule change that are filed with the I. Self-Regulatory Organization’s Securities and Exchange Commission
Commission, and all written Statement of the Terms of the Substance (‘‘Commission’’) in 2010. See Securities Exchange
Act Release No. 63275 (November 8, 2010), 75 FR
communications relating to the of the Proposed Rule Change 70048 (November 16, 2010) (SR–NYSEArca–2010–
proposed rule change between the The Exchange proposes to change its 100) (the ‘‘Original Co-location Filing’’). The
Commission and any person, other than rules to provide that the co-location Exchange operates a data center in Mahwah, New
those that may be withheld from the Jersey (the ‘‘data center’’) from which it provides
services offered by the Exchange co-location services to Users.
public in accordance with the include 40 gigabit (‘‘Gb’’) Internet 5 For purposes of the Exchange’s co-location
provisions of 5 U.S.C. 552, will be protocol (‘‘IP’’) network connections in services, a ‘‘User’’ means any market participant
available for Web site viewing and the Exchange’s data center. The that requests to receive co-location services directly
printing in the Commission’s Public from the Exchange. See Securities Exchange Act
Exchange proposes to amend the NYSE Release No. 76010 (September 29, 2015), 80 FR
Reference Room, 100 F Street NE., Arca Options Fee Schedule (the 60197 (October 5, 2015) (SR–NYSEArca–2015–82).
Washington, DC 20549, on official ‘‘Options Fee Schedule’’) and, through As specified in the Fee Schedules, a User that
business days between the hours of its wholly owned subsidiary NYSE Arca incurs co-location fees for a particular co-location
service pursuant thereto would not be subject to co-
mstockstill on DSK4VPTVN1PROD with NOTICES
10:00 a.m. and 3:00 p.m. Copies of the Equities, Inc. (‘‘NYSE Arca Equities’’), location fees for the same co-location service
filing also will be available for the NYSE Arca Equities Schedule of charged by the Exchange’s affiliates New York
inspection and copying at the principal Fees and Charges for Exchange Services Stock Exchange LLC and NYSE MKT LLC. See
office of the Exchange. All comments Securities Exchange Act Release No. 70173 (August
received will be posted without change; 13, 2013), 78 FR 50459 (August 19, 2013) (SR–
22 17 CFR 200.30–3(a)(12). NYSEArca–2013–80).
the Commission does not edit personal 1 15 U.S.C. 78s(b)(1). 6 See Original Co-location Filing, at 70049 and
identifying information from 2 15 U.S.C. 78a.
Securities Exchange Act Release No. 74219
submissions. You should submit only 3 17 CFR 240.19b–4. Continued
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Document Created: 2015-12-14 14:53:41
Document Modified: 2015-12-14 14:53:41
| 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 70036 |
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