80 FR 74175 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Market Order Spread Protection

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 228 (November 27, 2015)

Page Range		74175-74177
FR Document		2015-30088

Federal Register, Volume 80 Issue 228 (Friday, November 27, 2015)

[Federal Register Volume 80, Number 228 (Friday, November 27, 2015)]
[Notices]
[Pages 74175-74177]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2015-30088]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76499; File No. SR-NASDAQ-2015-142]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to Market Order Spread Protection

November 20, 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 12, 2015, The NASDAQ Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III, 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 the rules of the NASDAQ Options
Market, LLC (``NOM''), NASDAQ's facility for executing and routing
standardized equity and index options, at Chapter VI, Section 6,
entitled ``Acceptance of Quotes and Orders,'' specifically at Section
6(c) concerning Market Order Spread Protection.
The text of the proposed rule change is available on the Exchange's
Web site at http://nasdaq.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 purpose of this filing is to amend Chapter VI, Section 6
entitled ``Acceptance of Quotes and Orders,'' specifically, at
paragraph (c) related to Market Order Spread Protection. This feature
was adopted as an enhancement to NOM's Systems in 2011.\3\ The Market
Order Spread Protection was designed to protect Market Orders \4\ from
being executed in very wide markets. This feature is not optional and
is set at the same threshold for all options traded on NOM. The Market
Order Spread Protection is applicable to all Participants submitting
Market Orders.
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\3\ See Securities Exchange Act Release No. 64667 (June 14,
2011), 76 FR 35930 (June 20, 2011) (SR-NASDAQ-2011-080).
\4\ ``Market Orders'' are orders to buy or sell at the best
price available at the time of execution. Participants can designate
that their Market Orders not executed after a pre-established period
of time, as established by the Exchange, will be cancelled back to
the Participant. See NOM Rules at Chapter VI, Section 1(e)(5).
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At this time, the Exchange is proposing to amend Section 6(c) which
currently states, ``System Orders that are Market Orders will be
rejected if the NBBO is wider than a preset threshold at the time the
order is received by the System.'' The Exchange proposes to amend this
sentence as follows: ``System Orders that are Market Orders will be
rejected if the best of the NBBO and the internal market BBO \5\ (the
``Reference BBO'') is wider than a preset threshold at the time the
order is received by the System.'' The Exchange is amending this rule
text to account for both Price-Improving \6\ and Post-Only Orders.\7\
Both of these order types, as well as orders which would lock or cross
another market,\8\ could result in non-displayed pricing and would
result

[[Page 74176]]

in the internal market BBO being better than the NBBO.
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\5\ Best Bid or Best Offer on NOM.
\6\ See NOM Rules at Chapter VI, Section 1(e)(6).
\7\ See NOM Rules at Chapter VI, Section 1(e)(11).
\8\ Options Order Protection and Locked and Crossed Market Rules
are located in Chapter XII of NOM Rules. In the event of a locked
and crossed market, the BBO will be repriced and displayed in
accordance with NOM Rules at Chapter VI, Section 7(b)(3)(C).
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Price Improving Orders are orders to buy or sell an option at a
specified price at an increment smaller than the minimum price
variation (``MPV'') in the security. Price Improving Orders may be
entered in increments as small as one cent. Price Improving Orders that
are available for display shall be displayed at the minimum price
variation in that security and shall be rounded up for sell orders and
rounded down for buy orders.
Post-Only Orders are orders that will not remove liquidity from the
System. Post-Only Orders are to be ranked and executed on the Exchange
or cancelled, as appropriate, without routing away to another market.
Post-Only Orders are evaluated at the time of entry with respect to
locking or crossing other orders as follows: (i) If a Post-Only Order
would lock or cross an order on the System, the order will be re-priced
to $.01 below the current low offer (for bids) or above the current
best bid (for offers) and displayed by the System at one minimum price
increment below the current low offer (for bids) or above the current
best bid (for offers); and (ii) if a Post-Only Order would not lock or
cross an order on the System but would lock or cross the NBBO as
reflected in the protected quotation of another market center, the
order will be handled pursuant to Chapter VI, Section 7(b)(3)(C).
Participants may choose to have their Post-Only Orders returned
whenever the order would lock or cross the NBBO or be placed on the
book at a price other than its limit price. Post-Only Orders received
prior to the opening will be eligible for execution during the opening
cross and will be processed as per Chapter VI, Section 8. Post-Only
Orders received after market close will be rejected.\9\ Similarly, with
this order type, market participants are able to submit orders or
quotes priced between the MPV.
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\9\ Post-Only Orders may not have a time-in-force designation of
Good Til Cancelled or Immediate or Cancel.
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The current rule text does not reflect the possibility that orders
or quotes could be priced between the MPV. The proposed rule text
amends the current rule text to account for Price Improving and Post-
Only Orders and the results of repricing.
The following is an example of a Price Improving Order and Market
Order Spread Protection. Assume an option MPV is scaled in $0.05
increments and a limit buy order of $0.05 exists on the Exchange. If a
Price Improving sell order is entered at $0.11, this order will not be
displayed at its limit of $0.11, because the order is priced at a non-
MPV increment. This order will be displayed at the nearest MPV price of
$0.15 (because of the option's $0.05 MPV increment). Assume this order
makes up the best offer on the Exchange. For this example, assume the
Market Order Spread Threshold in the System is set at $0.09. Further
assume a Market Order to buy is submitted to the Exchange. Based on the
Exchange's proposed implementation of Market Order Spread Protection,
the Market Order to buy would execute against the resting sell order at
$0.11, since $0.11 is the best available offer and the internal market
BBO spread is $0.06 (spread between the best bid of $0.05 and the best
offer of $0.11) which is less than the Market Order Spread Threshold of
$0.09. Based on the current rule text, a Participant could expect their
Market Order to be rejected, since the NBBO spread is $0.10 (spread
between the best NBB of $0.05 and the NBO of $0.15) which exceeds the
$0.09 Market Order Spread Threshold. The Exchange is amending the rule
text to provide for the internal market BBO being better than the NBBO.
The following is a similar example for a Post-Only Order. Assume an
option MPV is scaled in $0.05 increments and a limit buy order of $0.05
exists on the Exchange. If a Post-Only Order is entered to sell at
$0.05, this order will not immediately trade at its limit of $0.05
since by definition it will not remove liquidity from the System.
Instead, the Post-Only Order will be available to trade $0.01 above the
locking price of $0.05 (i.e., $0.06) and displayed at the nearest MPV
increment price of $0.10. Assume this order makes up the best offer on
the Exchange. For this example, assume the Market Order Spread
Threshold in the System is set at $0.04. Further assume a Market Order
to buy is submitted to the Exchange. Based on the Exchange's proposed
implementation of Market Order Spread Protection, the Market Order to
buy would execute against the resting Post-Only Order at $0.06, since
$0.06 is the best available offer and the internal market BBO spread is
$0.01 (spread between the best bid of $0.05 and the best offer of
$0.06) which is less than the Market Order Spread Threshold of $0.04.
Based on the current rule text, a Participant could expect their Market
Order to be rejected, since the NBBO spread is $0.05 (spread between
the best NBB of $0.05 and the NBO of $0.10) which exceeds the $0.04
Market Order Spread Threshold.
This rule change will correct the existing rule text to reflect
current practice which accounts for non-displayed order types and
reprices due to trade-through and locked and crossed market
restrictions.\10\ Participants were notified via an Options Trader
Alert of this rule text error.\11\
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\10\ See Chapter XII of NOM Rules.
\11\ See Options Regulatory Alert 2015-28 dated September 4,
2015.
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act \12\ in general, and furthers the objectives of Section
6(b)(5) of the Act \13\ in particular, in that it is designed to
promote just and equitable principles of trade, 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, by amending the rule text to reflect the impact of non-
displayed order types and repricing due to trade-through and locked and
crossed market restrictions.
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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(5).
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Amending the current NOM rule text for Market Order Spread
Protection to account for non-displayed orders such as Price-Improving
and Post-Only Orders and repricing due to trade-through and locked and
crossed market restrictions would provide Participants with the
expected results of the Market Order Spread Protection feature. The
Exchange believes that it is consistent with the Act to amend the rule
text to reflect these non-displayed orders because today, these orders
types permit Participants to submit orders or quotes priced between the
MPV, which will be rounded to the nearest MPV for display.
The Exchange believes that the amendment to the Market Order Spread
Protection language does not otherwise create an impediment to a free
and open market because these two order types already exist today and
provide investors the opportunity to trade at a better price than would
otherwise be available, e.g. inside the disseminated best bid and offer
for a security, which could result in better executions for investors.
Further, these order types incent Participants to compete by putting
forth their best price to potentially match or better any Price
Improving or Post-Only Orders or any other order resident in the
System. This may result in more aggressive, rather than less
aggressive, trading interest. This proposal reflects the impact of
these order types on the Market Order Spread Protection feature.
By reflecting the proper rule text to account for these order types
the

[[Page 74177]]

Exchange is providing Participants with additional information with
which to anticipate the impact of the Market Order Spread Protection
feature.

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

The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange does not believe
that the proposal to amend the Market Order Spread Protection rule text
to account for Price Improving or Post-Only Orders or repricing due to
trade-through and locked and crossed market restrictions creates an
undue burden on competition because it will serve to provide
Participants with greater information to anticipate the impact of the
Market Order Spread Protection feature. Today, Participants are able to
submit orders or quotes priced between the MPV for display at the
nearest MPV. This rule change would reflect the ability to enter these
types of orders on NOM and the impact of the Market Order Spread
Protection feature. The purpose of this rule change is to protect
orders resting on the Order Book when the market is wide. This feature
will be applied in a similar manner to all Participants on NOM.

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

Because the foregoing 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, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \14\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\15\
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\14\ 15 U.S.C. 78s(b)(3)(a)(iii).
\15\ 17 CFR 240.19b-4(f)(6). 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.
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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: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.

IV. Solicitation of Comments

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

Electronic Comments

Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NASDAQ-2015-142 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NASDAQ-2015-142. 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-NASDAQ-2015-142 and should
be submitted on or before December 18, 2015.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-30088 Filed 11-25-15; 8:45 am]
BILLING CODE 8011-01-P

Federal Register / Vol. 80, No. 228 / Friday, November 27, 2015 / Notices 74175

organization consents, the Commission should be submitted on or before the proposed rule change and discussed
will: December 18, 2015. any comments it received on the
(A) by order approve or disapprove For the Commission, by the Division of proposed rule change. The text of these
the proposed rule change, or Trading and Markets, pursuant to delegated statements may be examined at the
(B) institute proceedings to determine authority.45 places specified in Item IV below. The
whether the proposed rule change Robert W. Errett, Exchange has prepared summaries, set
should be disapproved. Deputy Secretary. forth in sections A, B, and C below, of
[FR Doc. 2015–30078 Filed 11–25–15; 8:45 am] the most significant aspects of such
IV. Solicitation of Comments
BILLING CODE 8011–01–P
statements.
Interested persons are invited to
submit written data, views, and A. Self-Regulatory Organization’s
arguments concerning the foregoing, Statement of the Purpose of, and
SECURITIES AND EXCHANGE Statutory Basis for, the Proposed Rule
including whether the proposed rule COMMISSION
change is consistent with the Act. Change
Comments may be submitted by any of [Release No. 34–76499; File No. SR–
NASDAQ–2015–142] 1. Purpose
the following methods:
Self-Regulatory Organizations; The The purpose of this filing is to amend
Electronic Comments Chapter VI, Section 6 entitled
NASDAQ Stock Market LLC; Notice of
• Use the Commission’s Internet Filing and Immediate Effectiveness of ‘‘Acceptance of Quotes and Orders,’’
comment form (http://www.sec.gov/ Proposed Rule Change Relating to specifically, at paragraph (c) related to
rules/sro.shtml); or Market Order Spread Protection Market Order Spread Protection. This
• Send an email to rule-comments@ feature was adopted as an enhancement
sec.gov. Please include File Number SR– November 20, 2015. to NOM’s Systems in 2011.3 The Market
NYSEArca-2015–110 on the subject line. Pursuant to Section 19(b)(1) of the Order Spread Protection was designed
Securities Exchange Act of 1934 to protect Market Orders 4 from being
Paper Comments
(‘‘Act’’),1 and Rule 19b–4 thereunder,2 executed in very wide markets. This
• Send paper comments in triplicate notice is hereby given that on November feature is not optional and is set at the
to Brent J. Fields, Secretary, Securities 12, 2015, The NASDAQ Stock Market same threshold for all options traded on
and Exchange Commission, 100 F Street LLC (‘‘Nasdaq’’ or ‘‘Exchange’’) filed NOM. The Market Order Spread
NE., Washington, DC 20549–1090. with the Securities and Exchange Protection is applicable to all
All submissions should refer to File Commission (‘‘Commission’’) the Participants submitting Market Orders.
Number SR–NYSEArca-2015–110. This proposed rule change as described in At this time, the Exchange is
file number should be included on the Items I, II, and III, below, which Items proposing to amend Section 6(c) which
subject line if email is used. To help the have been prepared by the Exchange. currently states, ‘‘System Orders that are
Commission process and review your The Commission is publishing this Market Orders will be rejected if the
comments more efficiently, please use notice to solicit comments on the NBBO is wider than a preset threshold
only one method. The Commission will proposed rule change from interested at the time the order is received by the
post all comments on the Commission’s persons. System.’’ The Exchange proposes to
Internet Web site (http://www.sec.gov/ I. Self-Regulatory Organization’s amend this sentence as follows:
rules/sro.shtml). Copies of the Statement of the Terms of Substance of ‘‘System Orders that are Market Orders
submission, all subsequent the Proposed Rule Change will be rejected if the best of the NBBO
amendments, all written statements and the internal market BBO 5 (the
with respect to the proposed rule The Exchange proposes to amend the
‘‘Reference BBO’’) is wider than a preset
change that are filed with the rules of the NASDAQ Options Market,
threshold at the time the order is
Commission, and all written LLC (‘‘NOM’’), NASDAQ’s facility for
received by the System.’’ The Exchange
communications relating to the executing and routing standardized
is amending this rule text to account for
proposed rule change between the equity and index options, at Chapter VI,
both Price-Improving 6 and Post-Only
Commission and any person, other than Section 6, entitled ‘‘Acceptance of
Orders.7 Both of these order types, as
those that may be withheld from the Quotes and Orders,’’ specifically at
well as orders which would lock or
public in accordance with the Section 6(c) concerning Market Order
cross another market,8 could result in
provisions of 5 U.S.C. 552, will be Spread Protection.
The text of the proposed rule change non-displayed pricing and would result
available for Web site viewing and
printing in the Commission’s Public is available on the Exchange’s Web site
3 See Securities Exchange Act Release No. 64667
Reference Section, 100 F Street NE., at http://nasdaq.cchwallstreet.com, at
(June 14, 2011), 76 FR 35930 (June 20, 2011) (SR–
Washington, DC 20549 on official the principal office of the Exchange, and NASDAQ–2011–080).
business days between 10:00 a.m. and at the Commission’s Public Reference 4 ‘‘Market Orders’’ are orders to buy or sell at the

3:00 p.m. Copies of the filing will also Room. best price available at the time of execution.
Participants can designate that their Market Orders
be available for inspection and copying II. Self-Regulatory Organization’s not executed after a pre-established period of time,
at the NYSE’s principal office and on its Statement of the Purpose of, and as established by the Exchange, will be cancelled
Internet Web site at www.nyse.com. All Statutory Basis for, the Proposed Rule back to the Participant. See NOM Rules at Chapter
VI, Section 1(e)(5).
comments received will be posted Change
mstockstill on DSK4VPTVN1PROD with NOTICES

5 Best Bid or Best Offer on NOM.
without change; the Commission does
In its filing with the Commission, the 6 See NOM Rules at Chapter VI, Section 1(e)(6).
not edit personal identifying 7 See NOM Rules at Chapter VI, Section 1(e)(11).
Exchange included statements
information from submissions. You 8 Options Order Protection and Locked and
concerning the purpose of and basis for
should submit only information that Crossed Market Rules are located in Chapter XII of
you wish to make available publicly. All NOM Rules. In the event of a locked and crossed
45 17 CFR 200.30–3(a)(12). market, the BBO will be repriced and displayed in
submissions should refer to File 1 15 U.S.C. 78s(b)(1). accordance with NOM Rules at Chapter VI, Section
Number SR–NYSEArca-2015–110 and 2 17 CFR 240.19b–4. 7(b)(3)(C).

VerDate Sep<11>2014 19:01 Nov 25, 2015 Jkt 238001 PO 00000 Frm 00105 Fmt 4703 Sfmt 4703 E:\FR\FM\27NON1.SGM 27NON1

Federal Register / Vol. 80, No. 228 / Friday, November 27, 2015 / Notices 74177

Exchange is providing Participants with temporarily suspend such rule change if should refer to File Number SR–
additional information with which to it appears to the Commission that such NASDAQ–2015–142 and should be
anticipate the impact of the Market action is: (i) Necessary or appropriate in submitted on or before December 18,
Order Spread Protection feature. the public interest; (ii) for the protection 2015.
of investors; or (iii) otherwise in For the Commission, by the Division of
B. Self-Regulatory Organization’s
furtherance of the purposes of the Act. Trading and Markets, pursuant to delegated
Statement on Burden on Competition
If the Commission takes such action, the authority.16
The Exchange does not believe that Commission shall institute proceedings Robert W. Errett,
the proposed rule change will impose to determine whether the proposed rule Deputy Secretary.
any burden on competition not should be approved or disapproved. [FR Doc. 2015–30088 Filed 11–25–15; 8:45 am]
necessary or appropriate in furtherance
of the purposes of the Act. The IV. Solicitation of Comments BILLING CODE 8011–01–P

Exchange does not believe that the Interested persons are invited to
proposal to amend the Market Order submit written data, views, and
SECURITIES AND EXCHANGE
Spread Protection rule text to account arguments concerning the foregoing,
COMMISSION
for Price Improving or Post-Only Orders including whether the proposed rule
or repricing due to trade-through and change is consistent with the Act. [Investment Company Act Release No.
locked and crossed market restrictions Comments may be submitted by any of 31906; File No. 812–14475]
creates an undue burden on competition the following methods:
because it will serve to provide ETF Series Solutions and AlphaClone,
Electronic Comments Inc.; Notice of Application
Participants with greater information to
anticipate the impact of the Market • Use the Commission’s Internet November 19, 2015.
Order Spread Protection feature. Today, comment form (http://www.sec.gov/ AGENCY: Securities and Exchange
Participants are able to submit orders or rules/sro.shtml); or Commission (‘‘Commission’’).
quotes priced between the MPV for • Send an email to rule-comments@
ACTION: Notice of an application under
display at the nearest MPV. This rule sec.gov. Please include File Number SR–
NASDAQ–2015–142 on the subject line. section 6(c) of the Investment Company
change would reflect the ability to enter Act of 1940 (‘‘Act’’) for an exemption
these types of orders on NOM and the Paper Comments from section 15(a) of the Act and rule
impact of the Market Order Spread
Protection feature. The purpose of this • Send paper comments in triplicate 18f–2 under the Act, as well as from
to Secretary, Securities and Exchange certain disclosure requirements in rule
rule change is to protect orders resting 20a–1 under the Act, Item 19(a)(3) of
on the Order Book when the market is Commission, 100 F Street NE.,
Washington, DC 20549–1090. Form N–1A, Items 22(c)(1)(ii),
wide. This feature will be applied in a 22(c)(1)(iii), 22(c)(8) and 22(c)(9) of
similar manner to all Participants on All submissions should refer to File
Number SR–NASDAQ–2015–142. This Schedule 14A under the Securities
NOM. Exchange Act of 1934, and Sections 6–
file number should be included on the
C. Self-Regulatory Organization’s subject line if email is used. To help the 07(2)(a), (b), and (c) of Regulation S–X
Statement on Comments on the Commission process and review your (‘‘Disclosure Requirements’’). The
Proposed Rule Change Received From comments more efficiently, please use requested exemption would permit an
Members, Participants, or Others only one method. The Commission will investment adviser to hire and replace
post all comments on the Commission’s certain sub-advisers without
No written comments were either
Internet Web site (http://www.sec.gov/ shareholder approval and grant relief
solicited or received.
rules/sro.shtml). Copies of the from the Disclosure Requirements as
III. Date of Effectiveness of the they relate to fees paid to the sub-
submission, all subsequent
Proposed Rule Change and Timing for advisers.
amendments, all written statements
Commission Action
with respect to the proposed rule Applicants: ETF Series Solutions (the
Because the foregoing proposed rule change that are filed with the ‘‘Trust’’), a Delaware statutory trust
change does not: (i) Significantly affect Commission, and all written registered under the Act as an open-end
the protection of investors or the public communications relating to the management investment company with
interest; (ii) impose any significant proposed rule change between the multiple series, and AlphaClone, Inc.
burden on competition; and (iii) become Commission and any person, other than (the ‘‘Initial Adviser’’), a Delaware
operative for 30 days from the date on those that may be withheld from the corporation registered as an investment
which it was filed, or such shorter time public in accordance with the adviser under the Investment Advisers
as the Commission may designate, it has provisions of 5 U.S.C. 552, will be Act of 1940.
become effective pursuant to Section available for Web site viewing and Filing Dates: The application was
19(b)(3)(A)(iii) of the Act 14 and printing in the Commission’s Public filed on May 28, 2015 and amended on
subparagraph (f)(6) of Rule 19b–4 Reference Room, 100 F Street NE., September 25, 2015.
thereunder.15 Washington, DC 20549, on official Hearing or Notification of Hearing: An
At any time within 60 days of the business days between the hours of order granting the requested relief will
filing of the proposed rule change, the 10:00 a.m. and 3:00 p.m. Copies of the be issued unless the Commission orders
Commission summarily may filing also will be available for a hearing. Interested persons may
mstockstill on DSK4VPTVN1PROD with NOTICES

14 15
inspection and copying at the principal request a hearing by writing to the
U.S.C. 78s(b)(3)(a)(iii).
15 17
office of the Exchange. All comments Commission’s Secretary and serving
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6) requires a self-regulatory organization to give received will be posted without change; applicants with a copy of the request,
the Commission written notice of its intent to file the Commission does not edit personal personally or by mail. Hearing requests
the proposed rule change at least five business days identifying information from should be received by the Commission
prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
submissions. You should submit only by 5:30 p.m. on December 14, 2015, and
Commission. The Exchange has satisfied this information that you wish to make
requirement. available publicly. All submissions 16 17 CFR 200.30–3(a)(12).

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Document Created: 2015-12-14 14:04:37
Document Modified: 2015-12-14 14:04:37

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 74175