80_FR_77296 80 FR 77058 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Exchange Rules To Establish the Securities Trader and Securities Trader Principal Registration Categories

80 FR 77058 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Exchange Rules To Establish the Securities Trader and Securities Trader Principal Registration Categories

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 238 (December 11, 2015)

Page Range77058-77061
FR Document2015-31278

Federal Register, Volume 80 Issue 238 (Friday, December 11, 2015)
[Federal Register Volume 80, Number 238 (Friday, December 11, 2015)]
[Notices]
[Pages 77058-77061]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-31278]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76579; File No. SR-NYSEMKT-2015-100]


Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and 
Immediate Effectiveness of Proposed Rule Change Amending Exchange Rules 
To Establish the Securities Trader and Securities Trader Principal 
Registration Categories

December 8, 2015.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that on November 24, 2015, NYSE MKT LLC (the ``Exchange'' or 
``NYSE MKT'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-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 Exchange Rules to (1) prescribe the 
Securities Traders examination (Series 57) (the ``Series 57 
Examination'') as the qualifying examination for registered Market 
Makers, Market Maker Authorized Traders (``MMATs''), and Floor Brokers, 
(2) eliminate reference to the S501 Program as a continuing education 
requirement, and (3) rename the category ``Proprietary Trader'' as 
``Securities Trader'' in Exchange rules without making any substantive 
change to the definition of such term. The proposed rule change is 
available on the Exchange's Web site at www.nyse.com, at the principal 
office of the Exchange, and at the Commission's Public Reference Room.

[[Page 77059]]

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 self-regulatory organization 
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 those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

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

1. Purpose
    The Exchange proposes to amend Exchange Rules 921NY, 921.1NY and 
931NY to prescribe the Series 57 Examination as the qualifying 
examination for registered Market Makers, MMATs, and Floor Brokers.
    Exchange Rule 921NY currently specifies that an applicant must pass 
an examination prescribed by the Exchange in order to register as a 
Market Maker. Exchange Rule 921.1NY currently specifies that an 
applicant must pass an examination prescribed by the Exchange in order 
to register as a MMAT. And Exchange Rule 931NY currently specifies that 
an applicant must pass an examination prescribed by the Exchange in 
order to register as a Floor Broker. For purposes of these rules, NYSE 
Amex Options has currently prescribed the successful completion of the 
Proprietary Trader Qualification Examination (``Series 56 
Examination'') as the qualifying exam for Market Makers, MMATs and 
Floor Brokers. In addition, individuals currently engaged solely in 
proprietary trading, who are not registered as Market Makers, MMATs or 
Floor Brokers, may qualify for registration by successful completion of 
the Series 56 Examination or the General Securities Representative 
Qualification Examination (``Series 7 Examination'').
    The Exchange proposes to change the prescribed examination for 
Market Makers, MMATs and Floor Brokers from the Series 56 Examination 
to the Series 57 Examination. With this proposed rule change, Market 
Makers, MMATs, Floor Brokers and individuals engaged solely in 
proprietary trading will qualify for registration by passing the Series 
57 Examination.\4\
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    \4\ Currently, individuals engaged solely in proprietary trading 
can alternatively take the Series 7 Examination as a qualifying 
exam. After implementation of the Series 57 Examination, an 
individual engaged solely in proprietary trading will be required to 
take the Series 57 Examination as the Series 7 Examination would no 
longer serve as a qualifying exam to engage solely in proprietary 
trading.
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    The Series 57 Examination is being developed by the Financial 
Industry Regulatory Authority, Inc. (``FINRA'') in consultation with 
industry and exchange representatives. The Series 57 examination will 
be based on the current job functions of securities traders and will 
include elements of the Series 55 Equity Trader Qualification 
Examination (which is required to engage in over-the-counter securities 
trading) and the current Series 56 Registered Proprietary Traders 
Examination (which is required for associated persons engaged in 
securities trading).\5\ The Series 57 Examination will be based on 
industry rules applicable to trading of equity securities and listed 
options contracts. The Series 57 examination will cover, among other 
things, recordkeeping and recording requirements; types and 
characteristics of securities and investments; trading practices; and 
display, execution, and trading systems.\6\ As such, the Exchange 
believes that an applicant who has passed the Series 57 Examination is 
shown to be qualified to act in the capacity of a Market Maker, Floor 
Broker, MMAT or engage solely in proprietary trading on NYSE Amex 
Options.
---------------------------------------------------------------------------

    \5\ While the Series 56 Examination is required for associated 
persons engaged in proprietary trading, Exchange rules do not 
require such individuals to work at a proprietary trading firm only. 
These individuals can work at any type of firm. However, they may 
only engage in proprietary trading at the firm where they are 
employed. For example, an individual engaged in proprietary trading 
at a full service firm, who is registered solely to engage in 
proprietary trading, may not act as a registered representative for 
that firm.
    \6\ See Securities Exchange Act Release No. 75783 (August 28, 
2015), 80 FR 53369 (September 3, 2015) (SR-FINRA-2015-017) (Order 
Approving a Proposed Rule Change to Establish the Securities Trader 
and Securities Trader Principal Registration Categories).
---------------------------------------------------------------------------

    While NYSE Amex Options will no longer be offering the Series 56 
Examination as a qualifying exam to new applicants, the Exchange will 
continue to recognize individuals who have passed that exam as having 
successfully completed a qualifying exam. Individuals who have taken 
the Series 56 Examination and have registered in Web CRD \7\ as 
proprietary traders will have their registration converted in Web CRD 
on January 4, 2016 to a securities trader. Additionally, individuals 
currently engaged solely in proprietary trading, who currently qualify 
for registration by passing the Series 7 Examination and have 
registered in Web CRD as Proprietary Traders will have their 
registration converted in Web CRD on January 4, 2016 to a Securities 
Trader without having to take any additional examinations and without 
having to take any other actions. Individuals presently registered as 
Market Makers, MMATs, Floor Brokers or those that engage solely in 
proprietary trading on NYSE Amex Options, who have previously passed a 
qualifying exam will not be required to take the Series 57 Examination 
as a condition of their continued registration. However, the 
registration of individuals who have taken the Series 56 Examination 
will not be converted to a Securities Trader if they have not 
registered as a Proprietary Trader in Web CRD by December 28, 2015. 
After that date, these individuals will be required to take the Series 
57 Examination in order to register as securities traders. In addition, 
individuals registered as proprietary traders in Web CRD prior to the 
effective date of the proposed rule change will be eligible to register 
as securities traders without having to take any additional 
examinations, provided that no more than two years have passed between 
the date the individual last registered as a proprietary trader and the 
date the individual registers as a securities trader.\8\
---------------------------------------------------------------------------

    \7\ Web CRD is the central licensing and registration system for 
the U.S. securities industry and its regulators.
    \8\ See Rule 341A, Commentary .03.
---------------------------------------------------------------------------

    The Exchange also proposes to amend Exchange Rules 341 and 341A. 
Under the proposed rule change, the Exchange would rename the category 
``Proprietary Trader'' as ``Securities Trader'' in Rule 341 without 
making any substantive change to the definition of such term. A 
Securities Trader, similar to what is currently required for a 
Proprietary Trader, would be required to register as such on Web CRD 
and pass the Series 57 Examination described above, but would not be 
permitted to function in an agency capacity or otherwise conduct a 
public business in securities. Additionally, Rule 341 requires that an 
individual associated with an Exchange member with supervisory 
responsibility over proprietary trading activities qualify and register 
as a Proprietary Trader Principal. Under the proposed rule change, the 
Exchange would replace references in Rule 341 to Proprietary Trader 
Principal with Securities Trader Principal.

[[Page 77060]]

    Further, registered persons are required under Rule 341A to comply 
with the Exchange's continuing education requirements. Specifically, 
under Rule 341A(a)(1), individuals engaged solely in proprietary 
trading are required to complete the S501 Program to fulfill the 
Regulatory Element of their continuing education requirement. With the 
transition to the Series 57 Examination, the S501 Program will no 
longer be required; such individuals will instead be required to 
complete the S101 Program to fulfill the Regulatory Element of their 
continuing education requirement.
    The Exchange notes that in order to qualify as a Proprietary Trader 
Principal, an associated person currently must pass the Series 56 
Examination or the Series 7 Examination, and the Series 24 Examination. 
Once the Exchange has adopted the Series 57 Examination as the 
qualifying exam for a Securities Trader, associated persons would need 
to pass the Series 57 Examination and the Series 24 Examination in 
order to register as a Securities Trader Principal. Only those 
individuals who are registered as such would be qualified to supervise 
a Securities Trader. Individuals registered as a General Securities 
Principal would not be qualified to supervise a Securities Trader, nor 
would a Securities Trader Principal be able to act as a General 
Securities Principal, unless the individual is registered as a 
Securities Trader Principal and a General Securities Principal.
    Within 30 days of filing the proposed rule change, the Exchange 
will issue a Regulatory Bulletin announcing the operative date of the 
rule change, which will not be sooner than January 4, 2016.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Securities Exchange Act of 1934 (``Act''),\9\ in general, 
and furthers the objectives of Section 6(c)(3)(B) \10\ of the Act, 
pursuant to which a national securities exchange prescribes standards 
of training, experience and competence for members and their associated 
persons, and Section 6(b)(5) \11\ of the Act, in particular, in that it 
is designed, among other things, 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. The Exchange 
believes that prescribing the Series 57 Examination for Market Makers, 
MMATs, Floor Brokers and for individuals engaged solely in proprietary 
trading is appropriate because the Series 57 Examination addresses 
industry topics that establish the foundation for the regulatory and 
procedural knowledge necessary for such individuals to appropriately 
register under Exchange rules. In addition, the Series 57 Examination 
is expected to be shared by other exchanges and become the industry 
standard.\12\ Accordingly, adopting the Series 57 Examination will help 
to promote consistency in examination requirements and uniformity 
across markets.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(c)(3)(B).
    \11\ 15 U.S.C. 78f(b)(5).
    \12\ See supra, note 6.
---------------------------------------------------------------------------

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 proposed rule change does 
not impose any additional examination burdens on persons who are 
already registered. There is no obligation to take the Series 57 
examination in order to continue in their present duties, so the 
proposed rule change is not expected to disadvantage current registered 
persons relative to new entrants in this regard.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

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)(iii) of the Act \13\ and Rule 19b-4(f)(6) thereunder.\14\ 
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.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \14\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \15\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\16\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest.
---------------------------------------------------------------------------

    \15\ 17 CFR 240.19b-4(f)(6).
    \16\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \17\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \17\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

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-NYSEMKT-2015-100 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-NYSEMKT-2015-100. 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

[[Page 77061]]

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 Section, 100 F Street NE., Washington, DC 20549-1090. Copies 
of the filing will also be available for inspection and copying at the 
NYSE's principal office and on its Internet Web site at www.nyse.com. 
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-NYSEMKT-2015-
100 and should be submitted on or before January 4, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-31278 Filed 12-10-15; 8:45 am]
 BILLING CODE 8011-01-P



                                                  77058                           Federal Register / Vol. 80, No. 238 / Friday, December 11, 2015 / Notices

                                                  B. Self-Regulatory Organization’s                          within 60 days of the filing of the                   NASDAQ–2015–147, and should be
                                                  Statement on Burden on Competition                         proposed rule change, the Commission                  submitted on or before January 4, 2016.
                                                     Nasdaq does not believe that the                        summarily may temporarily suspend                       For the Commission, by the Division of
                                                  proposed rule change will result in a                      such rule change if it appears to the                 Trading and Markets, pursuant to delegated
                                                  burden on competition that is not                          Commission that such action is                        authority.14
                                                  necessary or appropriate in furtherance                    necessary or appropriate in the public                Robert W. Errett,
                                                  of the purposes of the Act, as                             interest, for the protection of investors,            Deputy Secretary.
                                                  amended.12 In terms of inter-market                        or otherwise in furtherance of the
                                                                                                                                                                   [FR Doc. 2015–31282 Filed 12–10–15; 8:45 am]
                                                  competition, the Exchange notes that it                    purposes of the Act.
                                                                                                                                                                   BILLING CODE 8011–01–P
                                                  operates in a highly competitive market                    IV. Solicitation of Comments
                                                  in which market participants can
                                                                                                               Interested persons are invited to
                                                  readily favor competing venues if they                                                                           SECURITIES AND EXCHANGE
                                                                                                             submit written data, views, and
                                                  deem fee levels at a particular venue to                                                                         COMMISSION
                                                                                                             arguments concerning the foregoing,
                                                  be excessive, or credit opportunities
                                                                                                             including whether the proposed rule
                                                  available at other venues to be more                                                                             [Release No. 34–76579; File No. SR–
                                                                                                             change is consistent with the Act.                    NYSEMKT–2015–100]
                                                  favorable. In such an environment, the
                                                                                                             Comments may be submitted by any of
                                                  Exchange must continually adjust its
                                                                                                             the following methods:                                Self-Regulatory Organizations; NYSE
                                                  fees and credits to remain competitive
                                                  with other exchanges and with                              Electronic Comments                                   MKT LLC; Notice of Filing and
                                                  alternative trading systems that have                                                                            Immediate Effectiveness of Proposed
                                                                                                               • Use the Commission’s Internet                     Rule Change Amending Exchange
                                                  been exempted from compliance with                         comment form (http://www.sec.gov/
                                                  the statutory standards applicable to                                                                            Rules To Establish the Securities
                                                                                                             rules/sro.shtml); or                                  Trader and Securities Trader Principal
                                                  exchanges. Because competitors are free                      • Send an email to rule-comments@
                                                  to modify their own fees and credits in                                                                          Registration Categories
                                                                                                             sec.gov. Please include File Number SR–
                                                  response, and because market                               NASDAQ–2015–147 on the subject line.                  December 8, 2015.
                                                  participants may readily adjust their                                                                               Pursuant to Section 19(b)(1) 1 of the
                                                  order routing practices, the Exchange                      Paper Comments
                                                                                                                                                                   Securities Exchange Act of 1934 (the
                                                  believes that the degree to which fee                         • Send paper comments in triplicate                ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
                                                  changes in this market may impose any                      to Secretary, Securities and Exchange                 notice is hereby given that on November
                                                  burden on competition is extremely                         Commission, 100 F Street NE.,                         24, 2015, NYSE MKT LLC (the
                                                  limited.                                                   Washington, DC 20549–1090.                            ‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with
                                                     In this instance, the proposed change                   All submissions should refer to File
                                                  to the credits provided for all three                                                                            the Securities and Exchange
                                                                                                             Number SR–NASDAQ–2015–147. This                       Commission (the ‘‘Commission’’) the
                                                  Tapes to member firms for displayed                        file number should be included on the
                                                  quotes/orders (other than supplemental                                                                           proposed rule change as described in
                                                                                                             subject line if email is used. To help the            Items I, II, and III below, which Items
                                                  orders or designated retail orders) that                   Commission process and review your
                                                  provide liquidity, does not impose a                                                                             have been prepared by the self-
                                                                                                             comments more efficiently, please use                 regulatory organization. The
                                                  burden on competition because the                          only one method. The Commission will
                                                  Exchange’s execution services are                                                                                Commission is publishing this notice to
                                                                                                             post all comments on the Commission’s                 solicit comments on the proposed rule
                                                  voluntary and subject to extensive                         Internet Web site (http://www.sec.gov/
                                                  competition both from other exchanges                                                                            change from interested persons.
                                                                                                             rules/sro.shtml). Copies of the
                                                  and from off-exchange venues. In sum,                      submission, all subsequent                            I. Self-Regulatory Organization’s
                                                  if the change proposed herein is                           amendments, all written statements                    Statement of the Terms of Substance of
                                                  unattractive to market participants, it is                 with respect to the proposed rule                     the Proposed Rule Change
                                                  likely that the Exchange will lose                         change that are filed with the
                                                  market share as a result. Accordingly,                                                                              The Exchange proposes to amend
                                                                                                             Commission, and all written                           Exchange Rules to (1) prescribe the
                                                  the Exchange does not believe that the                     communications relating to the
                                                  proposed change will impair the ability                                                                          Securities Traders examination (Series
                                                                                                             proposed rule change between the                      57) (the ‘‘Series 57 Examination’’) as the
                                                  of members or competing order                              Commission and any person, other than
                                                  execution venues to maintain their                                                                               qualifying examination for registered
                                                                                                             those that may be withheld from the                   Market Makers, Market Maker
                                                  competitive standing in the financial                      public in accordance with the
                                                  markets.                                                                                                         Authorized Traders (‘‘MMATs’’), and
                                                                                                             provisions of 5 U.S.C. 552, will be                   Floor Brokers, (2) eliminate reference to
                                                  C. Self-Regulatory Organization’s                          available for Web site viewing and                    the S501 Program as a continuing
                                                  Statement on Comments on the                               printing in the Commission’s Public                   education requirement, and (3) rename
                                                  Proposed Rule Change Received From                         Reference Room, 100 F Street NE.,                     the category ‘‘Proprietary Trader’’ as
                                                  Members, Participants, or Others                           Washington, DC 20549 on official                      ‘‘Securities Trader’’ in Exchange rules
                                                    Written comments were neither                            business days between the hours of                    without making any substantive change
                                                  solicited nor received.                                    10:00 a.m. and 3:00 p.m. Copies of such               to the definition of such term. The
                                                                                                             filing also will be available for                     proposed rule change is available on the
                                                  III. Date of Effectiveness of the                          inspection and copying at the principal               Exchange’s Web site at www.nyse.com,
                                                  Proposed Rule Change and Timing for                        office of the Exchange. All comments
jstallworth on DSK7TPTVN1PROD with NOTICES




                                                                                                                                                                   at the principal office of the Exchange,
                                                  Commission Action                                          received will be posted without change;               and at the Commission’s Public
                                                     The foregoing change has become                         the Commission does not edit personal                 Reference Room.
                                                  effective pursuant to Section                              identifying information from
                                                  19(b)(3)(A)(ii) of the Act.13 At any time                  submissions. You should submit only                     14 17 CFR 200.30–3(a)(12).
                                                                                                             information that you wish to make                       1 15 U.S.C. 78s(b)(1).
                                                    12 15   U.S.C. 78f(b)(8).                                available publicly. All submissions                     2 15 U.S.C. 78a.
                                                    13 15   U.S.C. 78s(b)(3)(A)(ii).                         should refer to File Number SR–                         3 17 CFR 240.19b–4.




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                                                                              Federal Register / Vol. 80, No. 238 / Friday, December 11, 2015 / Notices                                                 77059

                                                  II. Self-Regulatory Organization’s                      for registration by passing the Series 57               traders will have their registration
                                                  Statement of the Purpose of, and                        Examination.4                                           converted in Web CRD on January 4,
                                                  Statutory Basis for, the Proposed Rule                     The Series 57 Examination is being                   2016 to a securities trader. Additionally,
                                                  Change                                                  developed by the Financial Industry                     individuals currently engaged solely in
                                                                                                          Regulatory Authority, Inc. (‘‘FINRA’’) in               proprietary trading, who currently
                                                    In its filing with the Commission, the                consultation with industry and                          qualify for registration by passing the
                                                  self-regulatory organization included                   exchange representatives. The Series 57                 Series 7 Examination and have
                                                  statements concerning the purpose of,                   examination will be based on the                        registered in Web CRD as Proprietary
                                                  and basis for, the proposed rule change                 current job functions of securities                     Traders will have their registration
                                                  and discussed any comments it received                  traders and will include elements of the                converted in Web CRD on January 4,
                                                  on the proposed rule change. The text                   Series 55 Equity Trader Qualification                   2016 to a Securities Trader without
                                                  of those statements may be examined at                  Examination (which is required to                       having to take any additional
                                                  the places specified in Item IV below.                  engage in over-the-counter securities                   examinations and without having to
                                                  The Exchange has prepared summaries,                    trading) and the current Series 56                      take any other actions. Individuals
                                                  set forth in sections A, B, and C below,                Registered Proprietary Traders                          presently registered as Market Makers,
                                                  of the most significant parts of such                   Examination (which is required for                      MMATs, Floor Brokers or those that
                                                  statements.                                             associated persons engaged in securities                engage solely in proprietary trading on
                                                                                                          trading).5 The Series 57 Examination                    NYSE Amex Options, who have
                                                  A. Self-Regulatory Organization’s                       will be based on industry rules                         previously passed a qualifying exam
                                                  Statement of the Purpose of, and the                    applicable to trading of equity securities              will not be required to take the Series
                                                  Statutory Basis for, the Proposed Rule                  and listed options contracts. The Series                57 Examination as a condition of their
                                                  Change                                                  57 examination will cover, among other                  continued registration. However, the
                                                                                                          things, recordkeeping and recording                     registration of individuals who have
                                                  1. Purpose                                              requirements; types and characteristics                 taken the Series 56 Examination will not
                                                                                                          of securities and investments; trading                  be converted to a Securities Trader if
                                                     The Exchange proposes to amend
                                                                                                          practices; and display, execution, and                  they have not registered as a Proprietary
                                                  Exchange Rules 921NY, 921.1NY and
                                                                                                          trading systems.6 As such, the Exchange                 Trader in Web CRD by December 28,
                                                  931NY to prescribe the Series 57                        believes that an applicant who has                      2015. After that date, these individuals
                                                  Examination as the qualifying                           passed the Series 57 Examination is                     will be required to take the Series 57
                                                  examination for registered Market                       shown to be qualified to act in the                     Examination in order to register as
                                                  Makers, MMATs, and Floor Brokers.                       capacity of a Market Maker, Floor                       securities traders. In addition,
                                                     Exchange Rule 921NY currently                        Broker, MMAT or engage solely in                        individuals registered as proprietary
                                                  specifies that an applicant must pass an                proprietary trading on NYSE Amex                        traders in Web CRD prior to the effective
                                                  examination prescribed by the Exchange                  Options.                                                date of the proposed rule change will be
                                                  in order to register as a Market Maker.                    While NYSE Amex Options will no                      eligible to register as securities traders
                                                  Exchange Rule 921.1NY currently                         longer be offering the Series 56                        without having to take any additional
                                                  specifies that an applicant must pass an                Examination as a qualifying exam to                     examinations, provided that no more
                                                  examination prescribed by the Exchange                  new applicants, the Exchange will                       than two years have passed between the
                                                  in order to register as a MMAT. And                     continue to recognize individuals who                   date the individual last registered as a
                                                  Exchange Rule 931NY currently                           have passed that exam as having                         proprietary trader and the date the
                                                  specifies that an applicant must pass an                successfully completed a qualifying                     individual registers as a securities
                                                  examination prescribed by the Exchange                  exam. Individuals who have taken the                    trader.8
                                                                                                          Series 56 Examination and have                             The Exchange also proposes to amend
                                                  in order to register as a Floor Broker. For
                                                                                                          registered in Web CRD 7 as proprietary                  Exchange Rules 341 and 341A. Under
                                                  purposes of these rules, NYSE Amex
                                                                                                                                                                  the proposed rule change, the Exchange
                                                  Options has currently prescribed the                       4 Currently, individuals engaged solely in           would rename the category ‘‘Proprietary
                                                  successful completion of the Proprietary                proprietary trading can alternatively take the Series   Trader’’ as ‘‘Securities Trader’’ in Rule
                                                  Trader Qualification Examination                        7 Examination as a qualifying exam. After
                                                                                                                                                                  341 without making any substantive
                                                  (‘‘Series 56 Examination’’) as the                      implementation of the Series 57 Examination, an
                                                                                                          individual engaged solely in proprietary trading        change to the definition of such term. A
                                                  qualifying exam for Market Makers,                      will be required to take the Series 57 Examination      Securities Trader, similar to what is
                                                  MMATs and Floor Brokers. In addition,                   as the Series 7 Examination would no longer serve       currently required for a Proprietary
                                                  individuals currently engaged solely in                 as a qualifying exam to engage solely in proprietary    Trader, would be required to register as
                                                                                                          trading.
                                                  proprietary trading, who are not                           5 While the Series 56 Examination is required for    such on Web CRD and pass the Series
                                                  registered as Market Makers, MMATs or                   associated persons engaged in proprietary trading,      57 Examination described above, but
                                                  Floor Brokers, may qualify for                          Exchange rules do not require such individuals to       would not be permitted to function in
                                                  registration by successful completion of                work at a proprietary trading firm only. These          an agency capacity or otherwise conduct
                                                                                                          individuals can work at any type of firm. However,
                                                  the Series 56 Examination or the                        they may only engage in proprietary trading at the
                                                                                                                                                                  a public business in securities.
                                                  General Securities Representative                       firm where they are employed. For example, an           Additionally, Rule 341 requires that an
                                                  Qualification Examination (‘‘Series 7                   individual engaged in proprietary trading at a full     individual associated with an Exchange
                                                  Examination’’).                                         service firm, who is registered solely to engage in     member with supervisory responsibility
                                                                                                          proprietary trading, may not act as a registered        over proprietary trading activities
                                                     The Exchange proposes to change the                  representative for that firm.
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                                                                                                                                                                  qualify and register as a Proprietary
                                                  prescribed examination for Market                          6 See Securities Exchange Act Release No. 75783

                                                                                                          (August 28, 2015), 80 FR 53369 (September 3, 2015)      Trader Principal. Under the proposed
                                                  Makers, MMATs and Floor Brokers from
                                                                                                          (SR–FINRA–2015–017) (Order Approving a                  rule change, the Exchange would
                                                  the Series 56 Examination to the Series                 Proposed Rule Change to Establish the Securities        replace references in Rule 341 to
                                                  57 Examination. With this proposed                      Trader and Securities Trader Principal Registration
                                                                                                                                                                  Proprietary Trader Principal with
                                                  rule change, Market Makers, MMATs,                      Categories).
                                                                                                             7 Web CRD is the central licensing and               Securities Trader Principal.
                                                  Floor Brokers and individuals engaged                   registration system for the U.S. securities industry
                                                  solely in proprietary trading will qualify              and its regulators.                                      8 See   Rule 341A, Commentary .03.



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                                                  77060                          Federal Register / Vol. 80, No. 238 / Friday, December 11, 2015 / Notices

                                                    Further, registered persons are                        public interest. The Exchange believes                 of the Act and Rule 19b–4(f)(6)(iii)
                                                  required under Rule 341A to comply                       that prescribing the Series 57                         thereunder.
                                                  with the Exchange’s continuing                           Examination for Market Makers,                            A proposed rule change filed under
                                                  education requirements. Specifically,                    MMATs, Floor Brokers and for                           Rule 19b–4(f)(6) 15 normally does not
                                                  under Rule 341A(a)(1), individuals                       individuals engaged solely in                          become operative prior to 30 days after
                                                  engaged solely in proprietary trading are                proprietary trading is appropriate                     the date of the filing. However, pursuant
                                                  required to complete the S501 Program                    because the Series 57 Examination                      to Rule 19b–4(f)(6)(iii),16 the
                                                  to fulfill the Regulatory Element of their               addresses industry topics that establish               Commission may designate a shorter
                                                  continuing education requirement. With                   the foundation for the regulatory and                  time if such action is consistent with the
                                                  the transition to the Series 57                          procedural knowledge necessary for                     protection of investors and the public
                                                  Examination, the S501 Program will no                    such individuals to appropriately                      interest.
                                                  longer be required; such individuals                     register under Exchange rules. In                         At any time within 60 days of the
                                                  will instead be required to complete the                 addition, the Series 57 Examination is                 filing of such proposed rule change, the
                                                  S101 Program to fulfill the Regulatory                   expected to be shared by other                         Commission summarily may
                                                  Element of their continuing education                    exchanges and become the industry                      temporarily suspend such rule change if
                                                  requirement.                                             standard.12 Accordingly, adopting the                  it appears to the Commission that such
                                                    The Exchange notes that in order to                    Series 57 Examination will help to                     action is necessary or appropriate in the
                                                  qualify as a Proprietary Trader                          promote consistency in examination                     public interest, for the protection of
                                                  Principal, an associated person                          requirements and uniformity across                     investors, or otherwise in furtherance of
                                                  currently must pass the Series 56                        markets.                                               the purposes of the Act. If the
                                                  Examination or the Series 7                                                                                     Commission takes such action, the
                                                  Examination, and the Series 24                           B. Self-Regulatory Organization’s                      Commission shall institute proceedings
                                                  Examination. Once the Exchange has                       Statement on Burden on Competition                     under Section 19(b)(2)(B) 17 of the Act to
                                                  adopted the Series 57 Examination as                       The Exchange does not believe that                   determine whether the proposed rule
                                                  the qualifying exam for a Securities                     the proposed rule change will impose                   change should be approved or
                                                  Trader, associated persons would need                    any burden on competition not                          disapproved.
                                                  to pass the Series 57 Examination and                    necessary or appropriate in furtherance
                                                  the Series 24 Examination in order to                    of the purposes of the Act. The                        IV. Solicitation of Comments
                                                  register as a Securities Trader Principal.               proposed rule change does not impose                     Interested persons are invited to
                                                  Only those individuals who are                           any additional examination burdens on                  submit written data, views, and
                                                  registered as such would be qualified to                 persons who are already registered.                    arguments concerning the foregoing,
                                                  supervise a Securities Trader.                           There is no obligation to take the Series              including whether the proposed rule
                                                  Individuals registered as a General                      57 examination in order to continue in                 change is consistent with the Act.
                                                  Securities Principal would not be                        their present duties, so the proposed                  Comments may be submitted by any of
                                                  qualified to supervise a Securities                      rule change is not expected to                         the following methods:
                                                  Trader, nor would a Securities Trader                    disadvantage current registered persons                Electronic Comments
                                                  Principal be able to act as a General                    relative to new entrants in this regard.
                                                  Securities Principal, unless the                                                                                   • Use the Commission’s Internet
                                                  individual is registered as a Securities                 C. Self-Regulatory Organization’s                      comment form (http://www.sec.gov/
                                                  Trader Principal and a General                           Statement on Comments on the                           rules/sro.shtml); or
                                                  Securities Principal.                                    Proposed Rule Change Received From                        • Send an email to rule-comments@
                                                    Within 30 days of filing the proposed                  Members, Participants, or Others                       sec.gov. Please include File Number SR–
                                                  rule change, the Exchange will issue a                     No written comments were solicited                   NYSEMKT–2015–100 on the subject
                                                  Regulatory Bulletin announcing the                       or received with respect to the proposed               line.
                                                  operative date of the rule change, which                 rule change.                                           Paper Comments
                                                  will not be sooner than January 4, 2016.
                                                                                                           III. Date of Effectiveness of the                         • Send paper comments in triplicate
                                                  2. Statutory Basis                                       Proposed Rule Change and Timing for                    to Brent J. Fields, Secretary, Securities
                                                     The Exchange believes that its                        Commission Action                                      and Exchange Commission, 100 F Street
                                                  proposal is consistent with Section 6(b)                    The Exchange has filed the proposed                 NE., Washington, DC 20549–1090.
                                                  of the Securities Exchange Act of 1934                   rule change pursuant to Section                        All submissions should refer to File
                                                  (‘‘Act’’),9 in general, and furthers the                 19(b)(3)(A)(iii) of the Act 13 and Rule                Number SR–NYSEMKT–2015–100. This
                                                  objectives of Section 6(c)(3)(B) 10 of the               19b–4(f)(6) thereunder.14 Because the                  file number should be included on the
                                                  Act, pursuant to which a national                        proposed rule change does not: (i)                     subject line if email is used. To help the
                                                  securities exchange prescribes standards                 Significantly affect the protection of                 Commission process and review your
                                                  of training, experience and competence                   investors or the public interest; (ii)                 comments more efficiently, please use
                                                  for members and their associated                         impose any significant burden on                       only one method. The Commission will
                                                  persons, and Section 6(b)(5) 11 of the                   competition; and (iii) become operative                post all comments on the Commission’s
                                                  Act, in particular, in that it is designed,              prior to 30 days from the date on which                Internet Web site (http://www.sec.gov/
                                                  among other things, to promote just and                  it was filed, or such shorter time as the              rules/sro.shtml). Copies of the
                                                  equitable principles of trade, to remove                 Commission may designate, if                           submission, all subsequent
jstallworth on DSK7TPTVN1PROD with NOTICES




                                                  impediments to, and perfect the                          consistent with the protection of                      amendments, all written statements
                                                  mechanism of a free and open market                      investors and the public interest, the                 with respect to the proposed rule
                                                  and a national market system, and, in                    proposed rule change has become                        change that are filed with the
                                                  general, to protect investors and the                    effective pursuant to Section 19(b)(3)(A)              Commission, and all written
                                                    9 15 U.S.C. 78f(b).                                      12 See supra, note 6.                                  15 17 CFR 240.19b–4(f)(6).
                                                    10 15 U.S.C. 78f(c)(3)(B).                               13 15 U.S.C. 78s(b)(3)(A)(iii).                        16 17 CFR 240.19b–4(f)(6)(iii).
                                                    11 15 U.S.C. 78f(b)(5).                                  14 17 CFR 240.19b–4(f)(6).                             17 15 U.S.C. 78s(b)(2)(B).




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                                                                                 Federal Register / Vol. 80, No. 238 / Friday, December 11, 2015 / Notices                                                 77061

                                                  communications relating to the                          place at a price that is below $1 per                 transactions to take place in open outcry
                                                  proposed rule change between the                        option contract through January 5, 2017.              at a price of at least $0 but less than $1
                                                  Commission and any person, other than                   The text of the proposed rule change is               per option contract.3 These lower priced
                                                  those that may be withheld from the                     available on the Exchange’s Web site                  transactions are traded pursuant to the
                                                  public in accordance with the                           (http://www.cboe.com/AboutCBOE/                       same procedures applicable to $1
                                                  provisions of 5 U.S.C. 552, will be                     CBOELegalRegulatoryHome.aspx), at                     cabinet trades, except that (i) bids and
                                                  available for Web site viewing and                      the Exchange’s Office of the Secretary,               offers for opening transactions are only
                                                  printing in the Commission’s Public                     and at the Commission’s Public                        permitted to accommodate closing
                                                  Reference Section, 100 F Street NE.,                    Reference Room.                                       transactions in order to limit use of the
                                                  Washington, DC 20549–1090. Copies of                                                                          procedure to liquidations of existing
                                                  the filing will also be available for                   II. Self-Regulatory Organization’s                    positions, and (ii) the procedures are
                                                  inspection and copying at the NYSE’s                    Statement of the Purpose of, and                      also available for trading in option
                                                  principal office and on its Internet Web                Statutory Basis for, the Proposed Rule                classes participating in the Penny Pilot
                                                  site at www.nyse.com. All comments                      Change                                                Program.4 The Exchange believes that
                                                  received will be posted without change;                   In its filing with the Commission, the              allowing a price of at least $0 but less
                                                  the Commission does not edit personal                   Exchange included statements                          than $1 better accommodates the closing
                                                  identifying information from                            concerning the purpose of and basis for               of options positions in series that are
                                                  submissions. You should submit only                     the proposed rule change and discussed                worthless or not actively traded,
                                                  information that you wish to make                       any comments it received on the                       particularly due to market conditions
                                                  available publicly. All submissions                     proposed rule change. The text of these               which may result in a significant
                                                  should refer to File Number SR–                         statements may be examined at the                     number of series being out-of-the-
                                                  NYSEMKT–2015–100 and should be                          places specified in Item IV below. The                money. For example, a market
                                                  submitted on or before January 4, 2016.                 Exchange has prepared summaries, set                  participant might have a long position
                                                    For the Commission, by the Division of                forth in sections A, B, and C below, of               in a call series with a strike price of
                                                  Trading and Markets, pursuant to delegated              the most significant aspects of such                  $100 and the underlying stock might
                                                  authority.18                                            statements.                                           now be trading at $30. In such an
                                                  Robert W. Errett,                                                                                             instance, there might not otherwise be a
                                                                                                          A. Self-Regulatory Organization’s                     market for that person to close-out the
                                                  Deputy Secretary.                                       Statement of the Purpose of, and
                                                  [FR Doc. 2015–31278 Filed 12–10–15; 8:45 am]
                                                                                                                                                                position even at the $1 cabinet price
                                                                                                          Statutory Basis for, the Proposed Rule
                                                  BILLING CODE 8011–01–P                                  Change                                                   3 See Securities Exchange Act Release Nos. 59188

                                                                                                                                                                (December 30, 2008), 74 FR 480 (January 6, 2009)
                                                                                                          1. Purpose                                            (SR–CBOE–2008–133) (adopting the amended
                                                  SECURITIES AND EXCHANGE                                    An ‘‘accommodation’’ or ‘‘cabinet’’                procedures on a temporary basis through January
                                                  COMMISSION                                                                                                    30, 2009), 59331 (January 30, 2009), 74 FR 6333
                                                                                                          trade refers to trades in listed options on           (February 6, 2009) (extending the amended
                                                  [Release No. 34–76566; File No. SR–CBOE–                the Exchange that are worthless or not                procedures on a temporary basis through May 29,
                                                  2015–108]                                               actively traded. Cabinet trading is                   2009), 60020 (June 1, 2009), 74 FR 27220 (June 8,
                                                                                                          generally conducted in accordance with                2009) (SR–CBOE–2009–034) (extending the
                                                  Self-Regulatory Organizations;                                                                                amended procedures on a temporary basis through
                                                                                                          the Exchange Rules, except as provided                June 1, 2010), 62192 (May 28, 2010), 75 FR 31828
                                                  Chicago Board Options Exchange,                         in Exchange Rule 6.54, Accommodation                  (June 4, 2010) (SR–CBOE–2010–052) (extending the
                                                  Incorporated; Notice of Filing and                      Liquidations (Cabinet Trades), which                  amended procedures on a temporary basis through
                                                  Immediate Effectiveness of a Proposed                   sets forth specific procedures for                    June 1, 2011); 64403 (May 4, 2011), 76 FR 27110
                                                  Rule Change To Amend Rule 6.54                                                                                (May 10, 2011) (SR–CBOE–2011–048) (extending
                                                                                                          engaging in cabinet trades. Rule 6.54                 the amended procedures on a temporary basis
                                                  December 7, 2015.
                                                                                                          currently provides for cabinet                        through December 30, 2011); 65872 (December 2,
                                                     Pursuant to Section 19(b)(1) of the                  transactions to occur via open outcry at              2011), 76 FR 76788 (December 8, 2011) (SR–CBOE–
                                                                                                          a cabinet price of $1 per option contract             2011–113) (extending the amended procedures on
                                                  Securities Exchange Act of 1934 (the                                                                          a temporary basis through June 29, 2012) 67144
                                                  ‘‘Act’’),1 and Rule 19b–4 thereunder,2                  in any options series open for trading in             (June 6, 2012), 77 FR 35095 (June 12, 2012) (SR–
                                                  notice is hereby given that on November                 the Exchange, except that the Rule is not             CBOE–2012–053) (extending the amended
                                                  23, 2015, Chicago Board Options                         applicable to trading in option classes               procedures on a temporary basis through June 28,
                                                                                                          participating in the Penny Pilot                      2013), and 69854 (June 25, 2013), 78 FR 39424 (July
                                                  Exchange, Incorporated (the ‘‘Exchange’’                                                                      1, 2013) (SR–CBOE–2013–063); 69893 (June 28,
                                                  or ‘‘CBOE’’) filed with the Securities                  Program. Under the procedures, bids                   2013), 78 FR 40539 (July 5, 2013) (both extending
                                                  and Exchange Commission (the                            and offers (whether opening or closing                the amended procedures on a temporary basis
                                                  ‘‘Commission’’) the proposed rule                       a position) at a price of $1 per option               through January 5, 2014) and 71090 (December 17,
                                                                                                          contract may be represented in the                    2013), 78 FR 77532 (December 23, 2013) (SR–
                                                  change as described in Items I and II                                                                         CBOE–2013–118) (extending the amended
                                                  below, which Items have been prepared                   trading crowd by a Floor Broker or by                 procedures on a temporary basis through January 5,
                                                  by the Exchange. The Commission is                      a Market-Maker or provided in response                2015), and 73974 (December 31, 2014), 80 FR 911
                                                  publishing this notice to solicit                       to a request by a PAR Official/OBO, a                 (January 7, 2015) (SR–CBOE–2014–093) (extending
                                                                                                          Floor Broker or a Market-Maker, but                   the amended procedures on a temporary basis
                                                  comments on the proposed rule change                                                                          through January 5, 2016).
                                                  from interested persons.                                must yield priority to all resting orders                4 Currently the $1 cabinet trading procedures are
                                                                                                          in the PAR Official/OBO cabinet book                  limited to options classes traded in $0.05 or $0.10
                                                  I. Self-Regulatory Organization’s                       (which resting cabinet book orders may                standard increment. The $1 cabinet trading
                                                  Statement of the Terms of the Substance                 be closing only). So long as both the                 procedures are not available in Penny Pilot Program
jstallworth on DSK7TPTVN1PROD with NOTICES




                                                  of the Proposed Rule Change                                                                                   classes because in those classes an option series can
                                                                                                          buyer and the seller yield to orders                  trade in a standard increment as low as $0.01 per
                                                     The Exchange proposes to extend its                  resting in the cabinet book, opening                  share (or $1.00 per option contract with a 100 share
                                                  program that allows transactions to take                cabinet bids can trade with opening                   multiplier). Because the temporary procedures
                                                                                                          cabinet offers at $1 per option contract.             allow trading below $0.01 per share (or $1.00 per
                                                                                                                                                                option contract with a 100 share multiplier), the
                                                    18 17 CFR 200.30–3(a)(12).                               The Exchange has temporarily                       procedures are available for all classes, including
                                                    1 15 U.S.C. 78s(b)(1).                                amended the procedures through                        those classes participating in the Penny Pilot
                                                    2 17 CFR 240.19b–4.                                   January 5, 2015 [sic] to allow                        Program.



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Document Created: 2018-03-02 09:12:44
Document Modified: 2018-03-02 09:12:44
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 77058 

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