80 FR 81637 - Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Proprietary Trader and Proprietary Trader Principal Registration Categories, Securities Trader and Securities Trader Principal Registration Categories, and Establishing the Series 57 Examination
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 250 (December 30, 2015)
Federal Register Volume 80, Issue 250 (December 30, 2015)
| Page Range | 81637-81640 | |
| FR Document | 2015-32815 |
[Federal Register Volume 80, Number 250 (Wednesday, December 30, 2015)] [Notices] [Pages 81637-81640] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-32815] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-76756; File No. SR-EDGX-2015-66] Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Proprietary Trader and Proprietary Trader Principal Registration Categories, Securities Trader and Securities Trader Principal Registration Categories, and Establishing the Series 57 Examination December 23, 2015. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on December 22, 2015, EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange has designated this proposal as a ``non-controversial'' proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b- 4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ 15 U.S.C. 78s(b)(3)(A). \4\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to retire the Proprietary Trader and Proprietary Trader Principal registration categories and to establish the Securities Trader and Securities Trader Principal registration categories. The Exchange is also amending its rules to establish the Series 57 examination as the appropriate qualification examination for Securities Traders and deleting the rule referring to the S501 continuing education program currently applicable to Proprietary Traders. The Exchange will announce the effective date of the proposed rule change in a circular distributed to Members. The text of the proposed rule change is available at the Exchange's Web site at www.batstrading.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 parts of such statements. (A) Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange is proposing herein to replace the Series 56 with the Series 57 examination and to make various related changes to its registration rules. Specifically, in response to the FINRA Amendments (defined below), the Exchange is proposing to retire the Proprietary Trader \5\ registration categories from its own registration rules relating to securities trading activity. It is also therefore retiring its Proprietary Trader Principal \6\ registration category. To take the place of the retired registration categories, the Exchange is establishing new Securities Trader and Securities Trader Principal registration categories. This filing is based upon and in response to SR-FINRA-2015-017, which was recently approved by the Commission.\7\ --------------------------------------------------------------------------- \5\ Rule 2.5, Interpretation and Policy .01(f). \6\ Rule 2.5, Interpretation and Policy .01(d). \7\ See Securities Exchange Act Release No. 75783 (August 28, 2015), 80 FR 53369 (September 3, 2015) (approving SR-FINRA-2015-017) referred to herein as the ``FINRA Amendments.'' According to the release, FINRA's expected effective date for the FINRA Amendments is January 4, 2016. --------------------------------------------------------------------------- New Securities Trader Registration Category Currently, under Exchange Rule 11.4(e), each person associated with a member who is included within the definition of an ``Authorized Trader'' in Rule 1.5(d) is required to register with [[Page 81638]] the Exchange and to pass an appropriate qualification examination before such registration may become effective. The Exchange recognizes the following qualification examinations as acceptable for purposes of registration as an Authorized Trader: Series 7, Series 56, or one of several foreign securities examination modules. Interpretation and Policy .01(f) of Exchange Rule 2.5 currently provides that a person may register with the Exchange as a Proprietary Trader if such person engages solely in proprietary trading, passes the Series 56 examination and is an associated person of a proprietary trading firm as defined in Interpretation and Policy .01(g) of Exchange Rule 2.5. Therefore, pursuant to Interpretation and Policy .01 to Exchange Rule 2.5, an individual meeting these criteria may register in the Proprietary Trader category after passing the Series 56 examination rather than as a General Securities Representative after passing the Series 7 examination or equivalent foreign securities examination module. In consultation with FINRA and other exchanges, and in order to harmonize the requirements for individuals engaged in trading activities, the Exchange is now proposing to retire the Proprietary Trader registration category. Similarly, the Exchange is proposing to adopt a new Securities Trader registration category. Under Exchange Rules, as revised, each person associated with a member who is included within the definition of Authorized Trader will be required to register as a Securities Trader unless they instead qualify based on the Series 7 examination or an equivalent foreign securities examination module. Therefore, representatives who previously qualified for Proprietary Trader registration will be required to register as Securities Traders. Accordingly, the Exchange is proposing to modify paragraph (f) of Interpretation and Policy .01 to reflect the new Securities Trader qualification as a permissible registration for Authorized Traders of Members that engage solely in trading on the Exchange on either an agency or principal basis. In order to register as a Securities Trader, an applicant would be required to have passed the new Securities Trader qualification examination (Series 57) or a predecessor examination (i.e., the Series 56, as described below). A person registered as a Proprietary Trader in the Central Registration Depository (CRD[supreg]) system on the effective date of the proposed rule change will be grandfathered as a Securities Trader without having to take any additional examinations and without having to take any other actions. In addition, individuals who were registered as Proprietary Traders in the CRD system 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 they were last registered as a representative and the date they register as a Securities Trader. Persons registered in the new category would be subject to the continuing education requirements of Interpretation and Policy .02(e) to Rule 2.5. The Exchange proposes to amend Interpretation and Policy .02(e) by removing the option for Series 56 registered persons to participate in the S501 Series 56 Proprietary Trader continuing education program in order to satisfy the Regulatory Element. The S501 Series 56 Proprietary Trader continuing education program is being phased out along with the Series 56 Proprietary Trader qualification examination. As a result, effective January 4, 2016, the S501 Series 56 Proprietary Trader continuing education program for Series 56 registered persons will cease to exist. In place of the S501 Series 56 Proprietary Trader continuing education program for Series 56 registered persons, the Exchange proposes that Series 57 registered persons be required to take the S101 General Program for Series 7 and all other registered persons. New Securities Trader Principal Registration Category Currently, under Interpretation and Policy .01(d), the Exchange requires each Member to register ``Principals'' \8\ with the Exchange. The Exchange requires the Series 24 examination to register as Principal. The Exchange will also accept the New York Stock Exchange Series 14 Compliance Official Examination in lieu of the Series 24 to satisfy the Principal examination requirement for any person designated as a Chief Compliance Officer. Further, in addition to the Series 24 or Series 14, in order to supervise the activities of General Securities Representatives a Principal generally must complete the Series 7 or an equivalent foreign examination module as a prerequisite to the Series 24 or Series 14. However, the Exchange currently permits the Series 56 as a prerequisite to the Series 24 or Series 14 for those Principals whose supervisory responsibilities are limited to overseeing the activities of proprietary traders, as described above. Like the Proprietary Trader category discussed above, the Proprietary Trader Principal registration category is being retired. Accordingly, the Exchange proposes to modify the references in the Rule regarding the prerequisite to the Series 24 or 14 for an individual that will supervise Series 57 qualified traders to correspond with the new Securities Trader exam. The Exchange proposes to establish the Securities Trader Principal category in Interpretation and Policy .01(d). --------------------------------------------------------------------------- \8\ Pursuant to Interpretation and Policy .01(d) to Rule 2.5, a Principal is ``any individual responsible for supervising the activities of a Member's Authorized Traders and each person designated as a Chief Compliance Officer on Schedule A of Form BD.'' --------------------------------------------------------------------------- The Exchange has been working with other exchanges and FINRA to develop this new principal registration category and believes that it is an appropriate corollary to the new Securities Trader representative registration category. To qualify for registration as a Securities Trader Principal, an applicant must become qualified and registered as a Securities Trader under proposed Interpretation and Policy .01(c) and pass either the Series 24 or Series 14 examination. A person who is qualified and registered as a Securities Trader Principal would only be permitted to have supervisory responsibility over the activities of Securities Traders, unless such person were separately qualified and registered in another appropriate principal registration category, such as the General Securities Principal registration category. Conversely, the proposed rule change clarifies that each principal who will have supervisory responsibility over registered Securities Traders is required to become qualified and registered as a Securities Trader Principal. A person registered as a General Securities Principal and as a Proprietary Trader Principal in the CRD system on the effective date of the proposed rule change will be eligible to register as a Securities Trader Principal without having to take any additional examinations. An individual who was registered as a General Securities Principal and as a Proprietary Trader Principal in the CRD system prior to the effective date of the proposed rule change will also be eligible to register as a Securities Trader Principal without having to take any additional examinations, provided that no more than two years have passed between the date they were last registered as a principal and the date they register as a Securities Trader Principal. Members, however, will be required to affirmatively register persons transitioning to the proposed [[Page 81639]] registration category as Securities Trader Principals on or after the effective date of the proposed rule change. Other Changes In order to accomplish the changes proposed above, the Exchange has proposed modifications throughout Interpretation and Policy .01 and .02 to Rule 2.5 as well as Rule 11.4(e) to eliminate references to Proprietary Trader, Proprietary Trader Principal, and Series 56 examination and to replace such references with Securities Trader, Securities Trader Principal and Series 57 examination. The Exchange also proposes to modify Rule 11.18, which sets forth the registration requirements applicable to Market Maker Authorized Traders, or MMATs, to cross-reference Interpretation and Policy .01 and .02. Although Rule 11.18 currently requires an MMAT to qualify by taking the Series 7 examination, the Exchange does not intend to impose different registration or continuing education requirements on MMATs than are required of Authorized Traders generally. In addition to these changes, the Exchange proposes to delete paragraph (h) to Interpretation .01, which currently states that: ``Principals responsible for supervising the activities of General Securities Representatives must successfully complete the Series 7 or an equivalent foreign examination module in addition to the Series 24.'' The Exchange proposes to eliminate this provision as duplicative with existing language in Interpretation and Policy .01, including paragraph (d), which states that ``[i]ndividuals that supervise the activities of General Securities Representatives must successfully complete the Series 7 or an equivalent foreign examination module as a prerequisite to the Series 24 or Series 14 and shall be referred to as General Securities Principals.'' The Exchange also proposes to modify a reference in Interpretation and Policy .01(e) from ``General Securities Representative Principal'' to ``General Securities Principal.'' In addition, the Exchange proposes to eliminate the fees applicable to the Series 56 examination as well as the fees associated with the continuing education necessary to maintain registration after passing the Series 56 examination. Consistent with all other examinations recognized by the Exchange, FINRA will administer the Series 57 examination and the continuing education requirements related thereto, and the Exchange will not be separately charging and collecting any fees in order to take such examination or participate in applicable continuing education. Finally, in order to continue to align the Exchange's rules with the rules of its affiliated exchanges, BATS Exchange, Inc. and BATS Y-Exchange, Inc., the Exchange proposes to modify the language, but not the substance, of Rule 11.4(e). 2. Statutory Basis The Exchange believes that proposed rule change is consistent with Section 6(b)(5) of the Act,\9\ which requires, among other things, that the Exchange's rules be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments to and perfect the mechanism of a free and open market and a national market system. The Exchange believes that the requirements of the Securities Trader and Securities Trader Principal registration categories, as well as the new Securities Trader qualification examination, should help ensure that proprietary traders and the principals who supervise proprietary traders and proprietary trading are, and will continue to be, properly trained and qualified to perform their functions which should protect investors and the public interest. --------------------------------------------------------------------------- \9\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- (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. Implementation of the proposed changes to the Exchange's registration rules in coordination with the FINRA Amendments does not present any competitive issues, but rather is designed to provide less burdensome and more efficient regulatory compliance for members and enhance the ability of the Exchange to fairly and efficiently regulate members, which will further enhance competition. Additionally, the proposed rule change should not affect intramarket competition because all similarly situated representatives and principals will be required to complete the same qualification examinations and maintain the same registrations. (C) Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange has neither solicited nor received written comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (A) Significantly affect the protection of investors or the public interest; (B) impose any significant burden on competition; and (C) by its terms, 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) of the Act \10\ and paragraph (f)(6) of Rule 19b-4 thereunder,\11\ the Exchange has designated this rule filing as non-controversial. The Exchange has given the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. --------------------------------------------------------------------------- \10\ 15 U.S.C. 78s(b)(3)(A). \11\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- The Exchange has requested that the Commission waive the thirty-day operative delay so that the proposal may become operative as of January 4, 2016. The Exchange states that waiving the thirty-day delay would allow the Exchange to eliminate the Proprietary Trader and Proprietary Trader Principal registration categories and adopt the Securities Trader and Securities Trader Principal registration categories at the same time as FINRA and the other national securities exchanges. The Commission believes that waiving the thirty day delay is consistent with the protection of investors and the public interest, as it will enable EDGX to have the new requirements in effect at the same time as the other SROs. Therefore, the Commission hereby waives the thirty-day operative delay and designates the proposal operative as of January 4, 2016.\12\ --------------------------------------------------------------------------- \12\ For purposes of waiving the 30-day operative delay, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). --------------------------------------------------------------------------- At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is: (1) Necessary or appropriate in [[Page 81640]] the public interest; (2) for the protection of investors; or (3) 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 proposal is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File No. SR-EDGX-2015-66 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 No. SR-EDGX-2015-66. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such filing will also 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 No. SR-EDGX-2015-66 and should be submitted on or before January 20, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\13\ --------------------------------------------------------------------------- \13\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Brent J. Fields, Secretary. [FR Doc. 2015-32815 Filed 12-29-15; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 80, No. 250 / Wednesday, December 30, 2015 / Notices 81637
required by the proposed rule change be 03), as modified by Amendment No. 1 to Proprietary Traders. The Exchange
preserved for a period of not less than and Amendment No. 2, be, and hereby will announce the effective date of the
five years. is, approved. proposed rule change in a circular
In approving the proposed rule For the Commission, pursuant to delegated distributed to Members.
change, as amended, the Commission authority.227 The text of the proposed rule change
has considered the proposed rule’s Brent J. Fields, is available at the Exchange’s Web site
impact on efficiency, competition, and Secretary.
at www.batstrading.com, at the
capital formation.224 The Commission principal office of the Exchange, and at
[FR Doc. 2015–32812 Filed 12–29–15; 8:45 am]
believes the proposed rule change takes the Commission’s Public Reference
BILLING CODE 8011–01–P
into account competitive concerns that Room.
could arise as a result of the costs II. Self-Regulatory Organization’s
associated with complying with the SECURITIES AND EXCHANGE Statement of the Purpose of, and
standards of conduct and duties that COMMISSION Statutory Basis for, the Proposed Rule
could lead some municipal advisors to Change
exit the market, curtail their activities or [Release No. 34–76756; File No. SR–EDGX–
consolidate with other firms. The MSRB 2015–66] In its filing with the Commission, the
has made efforts to minimize costs in Exchange included statements
Self-Regulatory Organizations; EDGX concerning the purpose of and basis for
response to commenters including: (i)
Exchange, Inc.; Notice of Filing and the proposed rule change and discussed
Narrowing the scope of the conflicts that
Immediate Effectiveness of Proposed any comments it received on the
must be disclosed, (ii) specifying a less
Rule Change Relating to Proprietary proposed rule change. The text of these
burdensome method for disclosing
Trader and Proprietary Trader Principal statements may be examined at the
conflicts and disciplinary actions and Registration Categories, Securities
documenting the municipal advisory places specified in Item IV below. The
Trader and Securities Trader Principal Exchange has prepared summaries, set
relationship, (iii) clarifying the Registration Categories, and
obligations owed by municipal advisors forth in Sections A, B, and C below, of
Establishing the Series 57 Examination the most significant parts of such
to obligated persons, (iv) including a
limited safe harbor to relieve municipal December 23, 2015. statements.
advisors that inadvertently engage in Pursuant to Section 19(b)(1) of the (A) Self-Regulatory Organization’s
municipal advisory activities from Securities Exchange Act of 1934 (the Statement of the Purpose of, and
compliance with section (b) of Proposed ‘‘Act’’),1 and Rule 19b–4 thereunder,2 Statutory Basis for, the Proposed Rule
Rule G–42, on disclosure of conflicts of notice is hereby given that on December Change
interest and other information, and 22, 2015, EDGX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘EDGX’’) filed with the 1. Purpose
section (c) of Proposed Rule G–42, on
documentation of the municipal Securities and Exchange Commission The Exchange is proposing herein to
advisory relationship, and (v) allowing (‘‘Commission’’) the proposed rule replace the Series 56 with the Series 57
certain municipal advisors to engage in change as described in Items I and II examination and to make various
principal transactions in a range of fixed below, which Items have been prepared related changes to its registration rules.
income securities for the investment of by the Exchange. The Exchange has Specifically, in response to the FINRA
bond proceeds. Moreover, the designated this proposal as a ‘‘non- Amendments (defined below), the
Commission continues to believe ‘‘that controversial’’ proposed rule change Exchange is proposing to retire the
the market for municipal advisory pursuant to Section 19(b)(3)(A) of the Proprietary Trader 5 registration
services is likely to remain competitive Act 3 and Rule 19b–4(f)(6)(iii) categories from its own registration
despite the potential exit of municipal thereunder,4 which renders it effective rules relating to securities trading
advisors, consolidation of municipal upon filing with the Commission. The activity. It is also therefore retiring its
advisors, or lack of new entrants into Commission is publishing this notice to Proprietary Trader Principal 6
the market.’’ 225 solicit comments on the proposed rule registration category. To take the place
As noted above, the Commission change from interested persons. of the retired registration categories, the
received 35 comment letters on the Exchange is establishing new Securities
I. Self-Regulatory Organization’s Trader and Securities Trader Principal
filing. The Commission believes that the
Statement of the Terms of Substance of registration categories. This filing is
MSRB, through its responses and
the Proposed Rule Change based upon and in response to SR–
through proposed changes in
Amendment No. 1 and Amendment No. The Exchange filed a proposal to FINRA–2015–017, which was recently
2, has addressed commenters’ concerns. retire the Proprietary Trader and approved by the Commission.7
For the reasons noted above, Proprietary Trader Principal registration
New Securities Trader Registration
including those discussed in the MSRB categories and to establish the Securities
Category
Response Letters, the Trader and Securities Trader Principal
Commission believes that the registration categories. The Exchange is Currently, under Exchange Rule
proposed rule change, as amended by also amending its rules to establish the 11.4(e), each person associated with a
Amendment No. 1 and Amendment No. Series 57 examination as the member who is included within the
2, is consistent with the Act. appropriate qualification examination definition of an ‘‘Authorized Trader’’ in
for Securities Traders and deleting the Rule 1.5(d) is required to register with
V. Conclusion
mstockstill on DSK4VPTVN1PROD with NOTICES
rule referring to the S501 continuing
It is therefore ordered, pursuant to education program currently applicable 5 Rule 2.5, Interpretation and Policy .01(f).
6 Rule 2.5, Interpretation and Policy .01(d).
Section 19(b)(2) of the Act,226 that the
7 See Securities Exchange Act Release No. 75783
proposed rule change (SR–MSRB–2015– 227 17CFR 200.30–3(a)(12).
1 15
(August 28, 2015), 80 FR 53369 (September 3, 2015)
U.S.C. 78s(b)(1). (approving SR–FINRA–2015–017) referred to herein
224 15 U.S.C. 78c(f). 2 17 CFR 240.19b–4.
as the ‘‘FINRA Amendments.’’ According to the
225 SEC Final Rule, 78 FR 67467, at 67608. 3 15 U.S.C. 78s(b)(3)(A).
release, FINRA’s expected effective date for the
226 15 U.S.C. 78s(b)(2). 4 17 CFR 240.19b–4(f)(6)(iii). FINRA Amendments is January 4, 2016.
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registration category as Securities continuing education. Finally, in order (C) Self-Regulatory Organization’s
Trader Principals on or after the to continue to align the Exchange’s rules Statement on Comments on the
effective date of the proposed rule with the rules of its affiliated exchanges, Proposed Rule Change Received From
change. BATS Exchange, Inc. and BATS Y- Members, Participants or Others
Other Changes Exchange, Inc., the Exchange proposes The Exchange has neither solicited
to modify the language, but not the nor received written comments on the
In order to accomplish the changes
substance, of Rule 11.4(e). proposed rule change.
proposed above, the Exchange has
proposed modifications throughout 2. Statutory Basis III. Date of Effectiveness of the
Interpretation and Policy .01 and .02 to Proposed Rule Change and Timing for
Rule 2.5 as well as Rule 11.4(e) to The Exchange believes that proposed Commission Action
eliminate references to Proprietary rule change is consistent with Section
6(b)(5) of the Act,9 which requires, Because the foregoing proposed rule
Trader, Proprietary Trader Principal,
change does not: (A) Significantly affect
and Series 56 examination and to among other things, that the Exchange’s
the protection of investors or the public
replace such references with Securities rules be designed to prevent fraudulent
interest; (B) impose any significant
Trader, Securities Trader Principal and and manipulative acts and practices, to burden on competition; and (C) by its
Series 57 examination. The Exchange promote just and equitable principles of terms, become operative for 30 days
also proposes to modify Rule 11.18, trade, to foster cooperation and from the date on which it was filed or
which sets forth the registration coordination with persons engaged in such shorter time as the Commission
requirements applicable to Market facilitating transactions in securities,
Maker Authorized Traders, or MMATs, may designate it has become effective
and to remove impediments to and pursuant to Section 19(b)(3)(A) of the
to cross-reference Interpretation and perfect the mechanism of a free and
Policy .01 and .02. Although Rule 11.18 Act 10 and paragraph (f)(6) of Rule 19b–
open market and a national market 4 thereunder,11 the Exchange has
currently requires an MMAT to qualify
system. The Exchange believes that the designated this rule filing as non-
by taking the Series 7 examination, the
requirements of the Securities Trader controversial. The Exchange has given
Exchange does not intend to impose
different registration or continuing and Securities Trader Principal the Commission written notice of its
education requirements on MMATs registration categories, as well as the intent to file the proposed rule change,
than are required of Authorized Traders new Securities Trader qualification along with a brief description and text
generally. In addition to these changes, examination, should help ensure that of the proposed rule change at least five
the Exchange proposes to delete proprietary traders and the principals business days prior to the date of filing
paragraph (h) to Interpretation .01, who supervise proprietary traders and of the proposed rule change, or such
which currently states that: ‘‘Principals proprietary trading are, and will shorter time as designated by the
responsible for supervising the activities continue to be, properly trained and Commission.
of General Securities Representatives qualified to perform their functions The Exchange has requested that the
must successfully complete the Series 7 which should protect investors and the Commission waive the thirty-day
or an equivalent foreign examination public interest. operative delay so that the proposal may
module in addition to the Series 24.’’ become operative as of January 4, 2016.
The Exchange proposes to eliminate this (B) Self-Regulatory Organization’s The Exchange states that waiving the
provision as duplicative with existing Statement on Burden on Competition thirty-day delay would allow the
language in Interpretation and Policy Exchange to eliminate the Proprietary
The Exchange does not believe that Trader and Proprietary Trader Principal
.01, including paragraph (d), which
the proposed rule change will impose registration categories and adopt the
states that ‘‘[i]ndividuals that supervise
the activities of General Securities any burden on competition not Securities Trader and Securities Trader
Representatives must successfully necessary or appropriate in furtherance Principal registration categories at the
complete the Series 7 or an equivalent of the purposes of the Act. same time as FINRA and the other
foreign examination module as a Implementation of the proposed national securities exchanges. The
prerequisite to the Series 24 or Series 14 changes to the Exchange’s registration Commission believes that waiving the
and shall be referred to as General rules in coordination with the FINRA thirty day delay is consistent with the
Securities Principals.’’ The Exchange Amendments does not present any protection of investors and the public
also proposes to modify a reference in competitive issues, but rather is interest, as it will enable EDGX to have
Interpretation and Policy .01(e) from designed to provide less burdensome the new requirements in effect at the
‘‘General Securities Representative and more efficient regulatory same time as the other SROs. Therefore,
Principal’’ to ‘‘General Securities compliance for members and enhance the Commission hereby waives the
Principal.’’ In addition, the Exchange the ability of the Exchange to fairly and thirty-day operative delay and
proposes to eliminate the fees efficiently regulate members, which will designates the proposal operative as of
applicable to the Series 56 examination further enhance competition. January 4, 2016.12
as well as the fees associated with the At any time within 60 days of the
Additionally, the proposed rule change
continuing education necessary to filing of the proposed rule change, the
should not affect intramarket
maintain registration after passing the Commission summarily may
competition because all similarly temporarily suspend such rule change if
Series 56 examination. Consistent with situated representatives and principals it appears to the Commission that such
mstockstill on DSK4VPTVN1PROD with NOTICES
all other examinations recognized by the
will be required to complete the same action is: (1) Necessary or appropriate in
Exchange, FINRA will administer the
qualification examinations and maintain
Series 57 examination and the
continuing education requirements the same registrations. 10 15 U.S.C. 78s(b)(3)(A).
11 17 CFR 240.19b–4.
related thereto, and the Exchange will 12 For purposes of waiving the 30-day operative
not be separately charging and delay, the Commission has considered the proposed
collecting any fees in order to take such rule’s impact on efficiency, competition, and capital
examination or participate in applicable 9 15 U.S.C. 78f(b)(5). formation. See 15 U.S.C. 78c(f).
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the public interest; (2) for the protection For the Commission, by the Division of addition, the proposed rule change
of investors; or (3) otherwise in Trading and Markets, pursuant to delegated reflects changes to the Exchange’s Fee
furtherance of the purposes of the Act. authority.13 Schedules related to these co-location
If the Commission takes such action, the Brent J. Fields, services.
Commission shall institute proceedings Secretary. The Exchange proposes to offer the
to determine whether the proposed rule [FR Doc. 2015–32815 Filed 12–29–15; 8:45 am] wireless connection to provide Users
should be approved or disapproved. BILLING CODE 8011–01–P with an alternative means of
connectivity for Third Party Data. As the
IV. Solicitation of Comments Exchange notes, wireless connections
Interested persons are invited to SECURITIES AND EXCHANGE involve beaming signals through the air
submit written data, views and COMMISSION between antennas that are within sight
arguments concerning the foregoing, of one another.6 Because the signals
including whether the proposal is [Release No. 34–76749; File No. SR–
NYSEArca–2015–99] travel a straight, unimpeded line, and
consistent with the Act. Comments may because light waves travel faster through
be submitted by any of the following Self-Regulatory Organizations; NYSE air than through glass (fiber optics),
methods: Arca, Inc.; Order Approving Proposed wireless messages have lower latency
Electronic Comments Rule Change to the Co-Location than messages travelling through fiber
Services Offered by the Exchange (the optics.7
• Use the Commission’s Internet Under the proposed rule change, the
Offering of a Wireless Connection To
comment form (http://www.sec.gov/ Exchange would utilize a network
Allow Users To Receive Market Data
rules/sro.shtml); or vendor to provide a wireless connection
• Send an email to rule-comments@ Feeds From Third Party Markets) and
to Reflect Changes to the NYSE Arca to the Third Party Data through wireless
sec.gov. Please include File No. SR– connections from the Exchange access
EDGX–2015–66 on the subject line. Options Fee Schedule and the NYSE
Arca Equities Schedule of Fees and centers in Secaucus and Carteret, New
Paper Comments Charges Related to These Services Jersey, to its data center in Mahwah,
• Send paper comments in triplicate New Jersey, through a series of towers
December 23, 2015. equipped with wireless equipment.8 A
to Secretary, Securities and Exchange
Commission, 100 F Street NE., I. Introduction User that chooses this optional service
Washington, DC 20549–1090. would be able to receive data feeds from
On October 23, 2015, NYSE Arca, Inc. NASDAQ and BATS Exchange, Inc. over
All submissions should refer to File No. (the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed a wireless connection. To receive Third
SR–EDGX–2015–66. This file number with the Securities and Exchange Party Data, the User would enter into a
should be included on the subject line Commission (the ‘‘Commission’’) contract with the relevant third party
if email is used. To help the pursuant to Section 19(b)(1) 1 of the market, which would charge the User
Commission process and review your Securities Exchange Act of 1934 (the the applicable market data fees for the
comments more efficiently, please use ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 a Third Party Data. The Exchange would
only one method. The Commission will proposed rule change to amend the co- charge the User fees for the wireless
post all comments on the Commission’s location services offered by the connection for the Third Party Data.9
Internet Web site (http://www.sec.gov/ Exchange to include a means for co- A User would be charged a $5,000
rules/sro.shtml). Copies of the located Users to receive market data non-recurring initial charge for each
submission, all subsequent feeds from third party markets through wireless connection and a monthly
amendments, all written statements a wireless connection. The proposed recurring charge (‘‘MRC’’) that would
with respect to the proposed rule rule change was published in the vary depending upon the feed that the
change that are filed with the Federal Register on November 12, User opts to receive. If a User purchased
Commission, and all written 2015.4 No comment letters were two wireless connections, it would pay
communications relating to the received in response to the Notice. This two non-recurring initial charges. The
proposed rule change between the order approves the proposed rule MRC for a wireless connection to each
Commission and any person, other than change.
those that may be withheld from the As specified in the Fee Schedules, a User that
public in accordance with the II. Description of the Proposed Rule
incurs co-location fees for a particular co-location
provisions of 5 U.S.C. 552, will be Change service pursuant thereto would not be subject to co-
available for Web site viewing and The Exchange proposes to change the location fees for the same co-location service
charged by the Exchange’s affiliates New York
printing in the Commission’s Public co-location services offered by the Stock Exchange LLC and NYSE MKT LLC. See
Reference Room, 100 F Street NE., Exchange to include a means for Users Securities Exchange Act Release No. 70173 (August
Washington, DC 20549, on official to receive market data feeds from third 13, 2013), 78 FR 50459 (August 19, 2013) (SR–
business days between the hours of party markets (the ‘‘Third Party Data’’) NYSEArca–2013–80).
6 See Notice, supra note 4 at 70051.
10:00 a.m. and 3:00 p.m. Copies of such through a wireless connection.5 In 7 See id.
filing will also be available for 8 The NASDAQ Stock Market LLC (‘‘NASDAQ’’)
inspection and copying at the principal 13 17 CFR 200.30–3(a)(12).
offers a similar wireless service. See Securities
1 15 U.S.C.78s(b)(1).
office of the Exchange. All comments Exchange Act Release No. 68735 (January 25, 2013),
2 15 U.S.C. 78a.
received will be posted without change; 3 17 CFR 240.19b–4.
78 FR 6842 (January 31, 2013) (SR–NASDAQ–2012–
119) (approving a proposed rule change to establish
mstockstill on DSK4VPTVN1PROD with NOTICES
the Commission does not edit personal 4 See Securities Exchange Act Release No. 76364 a new optional wireless connectivity for co-located
identifying information from (November 5, 2015), 80 FR 70051 (November 12, clients).
submissions. You should submit only 2015) (‘‘Notice’’). 9 A User would only receive the Third Party Data
information that you wish to make 5 For purposes of the Exchange’s co-location for which it had entered into a contract. For
available publicly. All submissions services, a ‘‘User’’ means any market participant example, a User that contracted with NASDAQ for
that requests to receive co-location services directly the NASDAQ Totalview-ITCH data feed but did not
should refer to File No. SR–EDGX– from the Exchange. See Securities Exchange Act contract to receive any other Third Party Data
2015–66 and should be submitted on or Release No. 76010 (September 29, 2015), 80 FR would receive only the NASDAQ Totalview-ITCH
before January 20, 2016. 60197 (October 5, 2015) (SR–NYSEArca–2015–82). data feed through its wireless connection.
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Document Created: 2015-12-30 03:16:06
Document Modified: 2015-12-30 03:16:06
| 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 81637 |
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