81 FR 22140 - Self-Regulatory Organizations; ISE Mercury, LLC; Notice of Filing of Proposed Rule Change Related to Market Wide Risk Protection
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 72 (April 14, 2016)
Federal Register Volume 81, Issue 72 (April 14, 2016)
| Page Range | 22140-22143 | |
| FR Document | 2016-08556 |
[Federal Register Volume 81, Number 72 (Thursday, April 14, 2016)] [Notices] [Pages 22140-22143] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-08556] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-77569; File No. SR-ISEMercury-2016-07] Self-Regulatory Organizations; ISE Mercury, LLC; Notice of Filing of Proposed Rule Change Related to Market Wide Risk Protection April 8, 2016. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that, on March 29, 2016, ISE Mercury, LLC (the ``Exchange'' or ``ISE Mercury'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change, as described in Items I, II, and III below, which Items have been prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to introduce new activity based order protections as described in more detail below. The text of the proposed rule change is available on the Exchange's Web site (http://www.ise.com), at the principal office of the Exchange, and at the Commission's Public Reference Room. [[Page 22141]] 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 these statements may be examined at the places specified in Item IV below. The self-regulatory organization has prepared summaries, set forth in sections A, B and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of the proposed rule change is to introduce new risk protections for orders designed to aid members in their risk management by supplementing current price reasonability checks with activity based order protections.\3\ In particular, the Exchange proposes to introduce two activity based risk protections that will be mandatory for all members: (1) the ``Order Entry Rate Protection,'' which protects members against entering orders at a rate that exceeds predefined thresholds,\4\ and (2) the ``Order Execution Rate Protection,'' which protects members against executing orders at a rate that exceeds their predefined risk settings. Both of these risk protections are detailed in Proposed Rule 714(d), ``Market Wide Risk Protection.'' \5\ The Exchange will announce the implementation date of the Market Wide Risk Protection in a circular to be distributed to members prior to implementation. --------------------------------------------------------------------------- \3\ The Exchange provides members with limit order price protections designed to prevent erroneous executions by rejecting orders priced too far through the market. See Rule 714(b)(2). \4\ The Exchange will determine when to initiate the Order Entry Rate Protection pre-open to allow members time to load their orders without inadvertently triggering the protection. The precise time will be established by the Exchange and communicated to members via circular prior to implementation. \5\ The term ``Market Wide Risk Protection'' includes both the ``Order Entry Rate Protection'' and the ``Order Execution Rate Protection.'' --------------------------------------------------------------------------- Pursuant to the proposed Market Wide Risk Protection rule, the Exchange's trading system (the ``System'') will maintain one or more counting programs on behalf of each member that will count the number of orders entered, and the number of contracts traded on ISE Mercury.\6\ Members can use multiple counting programs to separate risk protections for different groups established within the member.\7\ The counting programs will maintain separate counts, over rolling time periods specified by the member for each count, of: (1) the total number of orders entered; and (2) the total number of contracts traded.\8\ Contracts executed on the agency and contra-side of a two- sided crossing order will be counted separately for the Order Execution Rate Protection. --------------------------------------------------------------------------- \6\ Like the Market Wide Speed Bump functionality offered on the Exchange pursuant to Rule 804(g)(2), the Market Wide Risk Protection for ISE Mercury will not apply cross-market to other affiliated exchanges. \7\ The Exchange will explain how members can go about setting up risk protections for different groups (e.g., business units) in a circular issued to members. \8\ The member's allowable order rate for the Order Entry Rate Protection is comprised of the parameter defined in (1), while the allowable contract execution rate for the Order Execution Rate Protection is comprised of the parameter defined in (2). --------------------------------------------------------------------------- Members will have discretion to establish the applicable time period for each of the counts maintained under the Market Wide Risk Protection, provided that the selected period must be within minimum and maximum parameters established by the Exchange and announced via circular.\9\ While the Market Wide Risk Protection is mandatory for all members, the Exchange is not proposing to establish minimum or maximum values for the order entry and execution parameters described in (1) and (2) above. The Exchange believes that this approach will give members the flexibility needed to appropriately tailor the Market Wide Risk Protection to their respective risk management needs. In this regard, the Exchange notes that each member is in the best position to determine risk settings appropriate for their firm based on the member's trading activity and business needs. In the interest of maintaining a fair and orderly market, however, the Exchange will establish default values for the applicable time period and order entry and execution parameters in a circular to be distributed to members. Default values established by the Exchange will apply only to members that do not submit their own parameters for the Market Wide Risk Protection. --------------------------------------------------------------------------- \9\ The Exchange anticipates that the minimum and maximum values for the applicable time period will be initially set at one second and a full trading day, respectively. --------------------------------------------------------------------------- The System will trigger the Market Wide Risk Protection when the counting program has determined that the member has either (1) entered during the specified time period a number of orders exceeding its designated allowable order rate, or (2) executed during the specified time period a number of contracts exceeding its designated allowable contract execution rate. In particular, after a member enters an order, or a member's order is executed, the System will look back over the specified time period to determine whether the member has exceeded the threshold that it has set for the total number of orders entered or the total number of contracts traded, as applicable. If the member's threshold has been exceeded, the Market Wide Risk Protection will be triggered and the System will automatically reject all subsequent incoming orders entered by the member on ISE Mercury. In addition, if the member has opted in to this functionality, the System will automatically cancel all of the member's existing orders. The Market Wide Risk Protection will remain engaged until the member manually (e.g., via email) notifies the Exchange to enable the acceptance of new orders; however, the System will still allow members to interact with existing orders entered before the protection was triggered, including sending cancel order messages and receiving trade executions for those orders. The Exchange believes that the proposed Market Wide Risk Protection will assist members in better managing their risk when trading on ISE Mercury. In particular, the proposed rule change provides functionality that allows members to set risk management thresholds for the number of orders entered or contracts executed on the Exchange during a specified period. This is similar to how other options exchanges have implemented activity-based risk management protections,\10\ and the Exchange believes this functionality will likewise be beneficial for ISE Mercury members. --------------------------------------------------------------------------- \10\ See Securities Exchange Act Release Nos. 74118 (January 22, 2015), 80 FR 4605 (January 28, 2015) (Notice); 74496 (March 13, 2015), 80 FR 14421 (March 19, 2015) (Approval) (SR-MIAX-2015-03). --------------------------------------------------------------------------- The examples below illustrate how the Market Wide Risk Protection would work both for order entry and order execution protections: Example 1, Order Entry Rate Protection: Broker Dealer 1 (``BD1'') designates an allowable order rate of 499 orders/1 second. @0 milliseconds, BD1 enters 200 orders. (Order total: 200 orders) @450 milliseconds, BD1 enters 250 orders. (Order total: 450 orders) @950 milliseconds, BD1 enters 50 orders. (Order total: 500 orders) [[Page 22142]] Market Wide Risk Protection is triggered on ISE Mercury due to exceeding 499 orders in 1 second. All subsequent orders are rejected, and if BD1 has opted in to this functionality, all existing orders are cancelled. BD1 must contact Market Operations to resume trading. Example 2, Order Execution Rate Protection: BD1 designates an allowable execution rate of 15,000 contracts/2 seconds. @0 milliseconds, BD1 receives executions for 5,000 contracts. (Execution total: 5,000 contracts) @600 milliseconds, BD1 receives executions for 10,000 contracts. (Execution total: 15,000 contracts) @1550 milliseconds, BD1 receives executions for 2,000 contracts. (Execution total: 17,000 contracts) Market Wide Risk Protection is triggered on ISE Mercury due to exceeding 15,000 contracts in 2 seconds. All subsequent orders are rejected, and if BD1 has opted in to this functionality, all existing orders are cancelled. BD1 must contact Market Operations to resume trading. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b) of the Act.\11\ Specifically, the proposed rule change is consistent with Section 6(b)(5) of the Act,\12\ because it is designed to promote just and equitable principles of trade, remove impediments to and perfect the mechanisms of a free and open market and a national market system and, in general, to protect investors and the public interest. --------------------------------------------------------------------------- \11\ 15 U.S.C. 78f(b). \12\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange believes that the proposed rule change would assist with the maintenance of a fair and orderly market by establishing new activity based risk protections for orders. The Exchange currently offers a risk protection mechanism for market maker quotes that removes the member's quotes if a specified number of curtailment events occur during a set time period (``Market Wide Speed Bump'').\13\ The Exchange believes that this Market Wide Speed Bump functionality has been successful in reducing market maker risk and now proposes to adopt risk protections for orders that would allow other members to properly manage their exposure to excessive risk. In particular, the proposed rule change would implement two new risk protections based on the rate of order entry and order execution, respectively. The Exchange believes that both of these new protections, which together encompass the proposed Market Wide Risk Protection, would enable members to better manage their risk when trading options on the Exchange by limiting the member's risk exposure when systems or other issues result in orders being entered or executed at a rate that exceeds predefined thresholds. In today's market the Exchange believes that robust risk management is becoming increasingly more important for all members. The proposed rule change would provide an additional layer of risk protection for market participants that trade on the Exchange. --------------------------------------------------------------------------- \13\ See Rule 804(g)(2). --------------------------------------------------------------------------- The proposed Market Wide Risk Protection is similar to risk management functionality provided by other options exchanges, including, for example, the MIAX Options Exchange (``MIAX''), which recently received Commission approval for its ``Risk Protection Monitor'' for orders.\14\ In particular, the Market Wide Risk Protection is designed to reduce risk associated with system errors or market events that may cause members to send a large number of orders, or receive multiple, automatic executions, before they can adjust their exposure in the market. Without adequate risk management tools, such as those proposed in this filing, members could reduce the amount of order flow and liquidity that they provide. Such actions may undermine the quality of the markets available to customers and other market participants. Accordingly, the proposed rule change is designed to encourage members to submit additional order flow and liquidity to the Exchange, thereby removing impediments to and perfect [sic] the mechanisms of a free and open market and a national market system and, in general, protecting investors and the public interest. In addition, providing members with more tools for managing risk will facilitate transactions in securities because, as noted above, the members will have more confidence that protections are in place that reduce the risks from potential system errors and market events. As a result, the new functionality has the potential to promote just and equitable principles of trade. --------------------------------------------------------------------------- \14\ See supra note 10. --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition In accordance with Section 6(b)(8) of the Act,\15\ the Exchange does not believe that the proposed rule change would impose any burden on intermarket or intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Act. The proposed Market Wide Risk Protection is similar to risk protections already available on other options exchanges,\16\ and is designed to be a competitive offering that would mitigate the risk associated with trading on the Exchange. Market makers already benefit from Market Wide Speed Bump functionality available for quotes. The proposed change would extend new risk protections to orders so that additional market participants can benefit from risk mitigating functionality. In addition, the proposed functionality would be mandatory for all members, and would be made available on an equal and non-discriminatory basis. As such, the Exchange does not believe that the proposed rule change would impose any unnecessary burden on competition. --------------------------------------------------------------------------- \15\ 15 U.S.C. 78f(b)(8). \16\ See supra notes 10 and 14. --------------------------------------------------------------------------- C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the publication date of this notice or within such longer period (1) as the Commission may designate up to 45 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (2) as to which the self- regulatory organization consents, the Commission will: (a) by order approve or disapprove such proposed rule change; or (b) institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR- [[Page 22143]] ISEMercury-2016-07 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-ISEMercury-2016-07. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-ISEMercury-2016-07 and should be submitted on or before May 5, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\17\ --------------------------------------------------------------------------- \17\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2016-08556 Filed 4-13-16; 8:45 am] BILLING CODE 8011-01-P
![22140 Federal Register / Vol. 81, No. 72 / Thursday, April 14, 2016 / Notices
additional information available to same manner as during Regular Trading printing in the Commission’s Public
market participants regarding one Hours and therefore, does not raise any Reference Room, 100 F Street NE.,
product that trades during that trading unique or novel issues. Accordingly, the Washington, DC 20549, on official
session. The proposed rule change Commission designates the proposed business days between the hours of
merely reflects CBOE’s plans (as rule change to be operative as of April 10:00 a.m. and 3:00 p.m. Copies of the
reporting authority for VIX) to calculate 15, 2016.13 filing also will be available for
and disseminate the current values of At any time within 60 days of the inspection and copying at the principal
VIX during Extended Trading Hours. filing of the proposed rule change, the office of the Exchange. All comments
CBOE understands that one or more Commission summarily may received will be posted without change;
major market data vendors (e.g. temporarily suspend such rule change if the Commission does not edit personal
Bloomberg and Reuters) will widely it appears to the Commission that such identifying information from
disseminate the current VIX values action is necessary or appropriate in the submissions. You should submit only
during Extended Trading Hours, public interest, for the protection of information that you wish to make
providing Trading Permit Holders and investors, or otherwise in furtherance of available publicly. All submissions
other market participants with access to the purposes of the Act. If the should refer to File Number SR–CBOE–
those values through those vendors. As Commission takes such action, the 2016–028 and should be submitted on
CBOE is currently the only U.S. options Commission shall institute proceedings or before May 5, 2016.
exchange with Extended Trading Hours, to determine whether the proposed rule
For the Commission, by the Division of
and the only U.S. options exchange on should be approved or disapproved.
Trading and Markets, pursuant to delegated
which VIX options are listed for trading, IV. Solicitation of Comments authority.14
the proposed rule change has no impact Robert W. Errett,
on intermarket competition. Interested persons are invited to
submit written data, views and Deputy Secretary.
B. Self-Regulatory Organization’s arguments concerning the foregoing, [FR Doc. 2016–08557 Filed 4–13–16; 8:45 am]
Statement on Comments on the including whether the proposed rule BILLING CODE 8011–01–P
Proposed Rule Change Received From change is consistent with the Act.
Members, Participants, or Others Comments may be submitted by any of
the following methods: SECURITIES AND EXCHANGE
The Exchange neither solicited nor COMMISSION
received comments on the proposed Electronic Comments
rule change. • Use the Commission’s Internet [Release No. 34–77569; File No. SR–
comment form (http://www.sec.gov/ ISEMercury–2016–07]
III. Date of Effectiveness of the
Proposed Rule Change and Timing for rules/sro.shtml); or Self-Regulatory Organizations; ISE
Commission Action • Send an email to rule-comments@
Mercury, LLC; Notice of Filing of
sec.gov. Please include File Number SR–
Because the proposed rule change Proposed Rule Change Related to
CBOE–2016–028 on the subject line.
does not (i) significantly affect the Market Wide Risk Protection
protection of investors or the public Paper Comments
April 8, 2016.
interest; (ii) impose any significant • Send paper comments in triplicate Pursuant to Section 19(b)(1) of the
burden on competition; and (iii) become to Secretary, Securities and Exchange
operative for 30 days from the date on Securities Exchange Act of 1934
Commission, 100 F Street NE.,
which it was filed, or such shorter time (‘‘Act’’),1 and Rule 19b–4 thereunder,2
Washington, DC 20549–1090.
as the Commission may designate, the notice is hereby given that, on March
All submissions should refer to File 29, 2016, ISE Mercury, LLC (the
proposed rule change has become Number SR–CBOE–2016–028. This file
effective pursuant to Section 19(b)(3)(A) ‘‘Exchange’’ or ‘‘ISE Mercury’’) filed
number should be included on the with the Securities and Exchange
of the Act 11 and Rule 19b–4(f)(6) subject line if email is used. To help the
thereunder.12 Commission (‘‘Commission’’) the
Commission process and review your proposed rule change, as described in
The Exchange has asked the comments more efficiently, please use
Commission to waive the 30-day Items I, II, and III below, which Items
only one method. The Commission will have been prepared by the self-
operative delay so that the proposal may post all comments on the Commission’s
become operative on the date that VIX regulatory organization. The
Internet Web site (http://www.sec.gov/ Commission is publishing this notice to
values may become available during rules/sro.shtml). Copies of the
Extended Trading Hours, which is solicit comments on the proposed rule
submission, all subsequent change from interested persons.
expected to be April 15, 2016. The amendments, all written statements
Commission believes that waiving the with respect to the proposed rule I. Self-Regulatory Organization’s
30-day operative delay is consistent change that are filed with the Statement of the Terms of Substance of
with the protection of investors and the Commission, and all written the Proposed Rule Change
public interest. The Commission notes communications relating to the The Exchange proposes to introduce
that the proposed rule change merely proposed rule change between the new activity based order protections as
allows VIX values to be disseminated Commission and any person, other than described in more detail below. The text
during Extended Trading Hours in the those that may be withheld from the of the proposed rule change is available
public in accordance with the
mstockstill on DSK4VPTVN1PROD with NOTICES
11 15 U.S.C. 78s(b)(3)(A).
on the Exchange’s Web site (http://
12 17
provisions of 5 U.S.C. 552, will be www.ise.com), at the principal office of
CFR 240.19b–4(f)(6). As required under Rule
19b–4(f)(6)(iii), the Exchange provided the available for Web site viewing and the Exchange, and at the Commission’s
Commission with written notice of its intent to file Public Reference Room.
the proposed rule change, along with a brief 13 For purposes only of waiving the 30-day
description and the text of the proposed rule operative delay, the Commission has also
14 17 CFR 200.30–3(a)(12).
change, at least five business days prior to the date considered the proposed rule’s impact on
1 15 U.S.C. 78s(b)(1).
of filing of the proposed rule change, or such efficiency, competition, and capital formation. See
shorter time as designated by the Commission. 15 U.S.C. 78c(f). 2 17 CFR 240.19b–4.
VerDate Sep<11>2014 17:56 Apr 13, 2016 Jkt 238001 PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 E:\FR\FM\14APN1.SGM 14APN1](https://thefederalregister.org/doc/81_FR_22212/page/1.svg)
![22142 Federal Register / Vol. 81, No. 72 / Thursday, April 14, 2016 / Notices
Market Wide Risk Protection is triggered together encompass the proposed of the purposes of the Act. The
on ISE Mercury due to exceeding 499 orders Market Wide Risk Protection, would proposed Market Wide Risk Protection
in 1 second. All subsequent orders are enable members to better manage their is similar to risk protections already
rejected, and if BD1 has opted in to this
risk when trading options on the available on other options exchanges,16
functionality, all existing orders are
cancelled. BD1 must contact Market Exchange by limiting the member’s risk and is designed to be a competitive
Operations to resume trading. exposure when systems or other issues offering that would mitigate the risk
Example 2, Order Execution Rate result in orders being entered or associated with trading on the
Protection: BD1 designates an allowable executed at a rate that exceeds Exchange. Market makers already
execution rate of 15,000 contracts/2 seconds. predefined thresholds. In today’s market benefit from Market Wide Speed Bump
@0 milliseconds, BD1 receives executions the Exchange believes that robust risk functionality available for quotes. The
for 5,000 contracts. (Execution total: 5,000 management is becoming increasingly proposed change would extend new risk
contracts)
more important for all members. The protections to orders so that additional
@600 milliseconds, BD1 receives
executions for 10,000 contracts. (Execution proposed rule change would provide an market participants can benefit from
total: 15,000 contracts) additional layer of risk protection for risk mitigating functionality. In
@1550 milliseconds, BD1 receives market participants that trade on the addition, the proposed functionality
executions for 2,000 contracts. (Execution Exchange. would be mandatory for all members,
total: 17,000 contracts) The proposed Market Wide Risk and would be made available on an
Market Wide Risk Protection is triggered Protection is similar to risk management equal and non-discriminatory basis. As
on ISE Mercury due to exceeding 15,000 functionality provided by other options
contracts in 2 seconds. All subsequent orders such, the Exchange does not believe that
exchanges, including, for example, the the proposed rule change would impose
are rejected, and if BD1 has opted in to this
functionality, all existing orders are
MIAX Options Exchange (‘‘MIAX’’), any unnecessary burden on
cancelled. BD1 must contact Market which recently received Commission competition.
Operations to resume trading. approval for its ‘‘Risk Protection
Monitor’’ for orders.14 In particular, the C. Self-Regulatory Organization’s
2. Statutory Basis Market Wide Risk Protection is designed Statement on Comments on the
The Exchange believes that the to reduce risk associated with system Proposed Rule Change Received From
proposed rule change is consistent with errors or market events that may cause Members, Participants, or Others
the requirements of the Act and the members to send a large number of The Exchange has not solicited, and
rules and regulations thereunder that orders, or receive multiple, automatic does not intend to solicit, comments on
are applicable to a national securities executions, before they can adjust their this proposed rule change. The
exchange, and, in particular, with the exposure in the market. Without Exchange has not received any
requirements of Section 6(b) of the adequate risk management tools, such as unsolicited written comments from
Act.11 Specifically, the proposed rule those proposed in this filing, members members or other interested parties.
change is consistent with Section 6(b)(5) could reduce the amount of order flow
of the Act,12 because it is designed to and liquidity that they provide. Such III. Date of Effectiveness of the
promote just and equitable principles of actions may undermine the quality of Proposed Rule Change and Timing for
trade, remove impediments to and the markets available to customers and Commission Action
perfect the mechanisms of a free and other market participants. Accordingly, Within 45 days of the publication date
open market and a national market the proposed rule change is designed to of this notice or within such longer
system and, in general, to protect encourage members to submit period (1) as the Commission may
investors and the public interest. additional order flow and liquidity to designate up to 45 days of such date if
The Exchange believes that the the Exchange, thereby removing it finds such longer period to be
proposed rule change would assist with impediments to and perfect [sic] the appropriate and publishes its reasons
the maintenance of a fair and orderly mechanisms of a free and open market for so finding or (2) as to which the self-
market by establishing new activity and a national market system and, in regulatory organization consents, the
based risk protections for orders. The general, protecting investors and the Commission will:
Exchange currently offers a risk public interest. In addition, providing (a) by order approve or disapprove
protection mechanism for market maker members with more tools for managing such proposed rule change; or
quotes that removes the member’s risk will facilitate transactions in (b) institute proceedings to determine
quotes if a specified number of securities because, as noted above, the whether the proposed rule change
curtailment events occur during a set members will have more confidence should be disapproved.
time period (‘‘Market Wide Speed that protections are in place that reduce
Bump’’).13 The Exchange believes that IV. Solicitation of Comments
the risks from potential system errors
this Market Wide Speed Bump and market events. As a result, the new Interested persons are invited to
functionality has been successful in functionality has the potential to submit written data, views and
reducing market maker risk and now promote just and equitable principles of arguments concerning the foregoing,
proposes to adopt risk protections for trade. including whether the proposed rule
orders that would allow other members change is consistent with the Act.
to properly manage their exposure to B. Self-Regulatory Organization’s Comments may be submitted by any of
excessive risk. In particular, the Statement on Burden on Competition the following methods:
proposed rule change would implement In accordance with Section 6(b)(8) of
Electronic Comments
mstockstill on DSK4VPTVN1PROD with NOTICES
two new risk protections based on the the Act,15 the Exchange does not believe
rate of order entry and order execution, that the proposed rule change would • Use the Commission’s Internet
respectively. The Exchange believes that impose any burden on intermarket or comment form (http://www.sec.gov/
both of these new protections, which intramarket competition that is not rules/sro.shtml); or
necessary or appropriate in furtherance • Send an email to rule-comments@
11 15 U.S.C. 78f(b). sec.gov. Please include File Number SR–
12 15 U.S.C. 78f(b)(5). 14 See supra note 10.
13 See Rule 804(g)(2). 15 15 U.S.C. 78f(b)(8). 16 See supra notes 10 and 14.
VerDate Sep<11>2014 17:56 Apr 13, 2016 Jkt 238001 PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 E:\FR\FM\14APN1.SGM 14APN1](https://thefederalregister.org/doc/81_FR_22212/page/3.svg)
![Federal Register / Vol. 81, No. 72 / Thursday, April 14, 2016 / Notices 22143
ISEMercury–2016–07 on the subject Extension: Rule 605 of Regulation NMS, This per-respondent estimate is based
line. SEC File No. 270–488, OMB Control No. on the rate that a market center could
3235–0542 expect to obtain if it negotiated on an
Paper Comments
Notice is hereby given that pursuant individual basis. Based on the $2,978
• Send paper comments in triplicate to the Paperwork Reduction Act of 1995 estimate, the monthly cost to the 132
to Secretary, Securities and Exchange (44 U.S.C. 3501 et seq.) (‘‘PRA’’), the market centers to retain service
Commission, 100 F Street NE., Securities and Exchange Commission providers to prepare reports would be
Washington, DC 20549–1090. (‘‘Commission’’) has submitted to the $393,096, or an annual cost of
All submissions should refer to File Office of Management and Budget approximately $4,717,152.
Number SR–ISEMercury–2016–07. This (‘‘OMB’’) a request for approval of The collection of information
file number should be included on the extension of the previously approved obligation imposed by Rule 605 is
subject line if email is used. To help the collection of information provided for in mandatory. The response will be
Commission process and review your Rule 605 (17 CFR 242.605) under the available to the public and will not be
comments more efficiently, please use Securities Exchange Act of 1934 (15 kept confidential.
only one method. The Commission will U.S.C. 78a et seq.) (‘‘Exchange Act’’). An agency may not conduct or
post all comments on the Commission’s Rule 605 of Regulation NMS,1 sponsor, and a person is not required to
Internet Web site (http://www.sec.gov/ formerly known as, Rule 11Ac1–5, respond to, a collection of information
rules/sro.shtml). Copies of the requires market centers to make under the PRA unless it displays a
submission, all subsequent available to the public monthly order currently valid OMB control number.
amendments, all written statements execution reports in electronic form. The public may view background
with respect to the proposed rule The Commission believes that many documentation for this information
change that are filed with the market centers retain most, if not all, of collection at the following Web site,
Commission, and all written the underlying raw data necessary to www.reginfo.gov. Comments should be
communications relating to the generate these reports in electronic directed to: (i) Desk Officer for the
proposed rule change between the format. Once the necessary data is Securities and Exchange Commission,
Commission and any person, other than collected, market centers could either Office of Information and Regulatory
those that may be withheld from the program their systems to generate the Affairs, Office of Management and
public in accordance with the statistics and reports, or transfer the Budget, Room 10102, New Executive
provisions of 5 U.S.C. 552, will be data to a service provider (such as an Office Building, Washington, DC 20503,
available for Web site viewing and independent company in the business of or by sending an email to: Shagufta_
printing in the Commission’s Public preparing such reports or a self- Ahmed@omb.eop.gov; and (ii) Pamela
Reference Room, 100 F Street NE., regulatory organization) that would Dyson, Director/Chief Information
Washington, DC 20549, on official generate the statistics and reports. Officer, Securities and Exchange
business days between the hours of The collection of information Commission, c/o Remi Pavlik-Simon,
10:00 a.m. and 3:00 p.m. Copies of the obligations of Rule 605 apply to all 100 F Street NE., Washington, DC
filing also will be available for market centers that receive covered 20549, or by sending an email to PRA_
inspection and copying at the principal orders in national market system Mailbox@sec.gov. Comments must be
office of the Exchange. All comments securities. The Commission estimates submitted to OMB within 30 days of
received will be posted without change; that approximately 132 market centers this notice.
the Commission does not edit personal are subject to the collection of Dated: April 8, 2016.
identifying information from information obligations of Rule 605.
submissions. You should submit only Robert W. Errett,
Each of these respondents is required to
information that you wish to make Deputy Secretary.
respond to the collection of information
available publicly. All submissions on a monthly basis. [FR Doc. 2016–08552 Filed 4–13–16; 8:45 am]
should refer to File Number SR– The Commission staff estimates that, BILLING CODE 8011–01–P
ISEMercury–2016–07 and should be on average, Rule 605 causes respondents
submitted on or before May 5, 2016. to spend 6 hours per month to collect
the data necessary to generate the SECURITIES AND EXCHANGE
For the Commission, by the Division of
Trading and Markets, pursuant to delegated reports, or 72 hours per year. With an COMMISSION
authority.17 estimated 132 market centers subject to [Release No. 34–77567; File No. SR–BATS–
Robert W. Errett, Rule 605, the total data collection time 2015–94]
Deputy Secretary. burden to comply with the monthly
[FR Doc. 2016–08556 Filed 4–13–16; 8:45 am] reporting requirement is estimated to be Self-Regulatory Organizations; BATS
BILLING CODE 8011–01–P 9,504 hours per year. Exchange, Inc.; Notice of Filing of
Based on discussions with industry Amendment No. 1 and Order
sources, the Commission staff estimates Approving on an Accelerated Basis a
SECURITIES AND EXCHANGE that an individual market center could Proposed Rule Change, as Modified by
COMMISSION retain a service provider to prepare a Amendments No. 1, No. 2, and No. 3,
monthly report using the data collected To List and Trade Shares of the SPDR
Submission for OMB Review; for approximately $2,978 per month. DoubleLine Emerging Markets Fixed
Comment Request Income ETF of the SSgA Active Trust
mstockstill on DSK4VPTVN1PROD with NOTICES
1 Regulation NMS, adopted by the Commission in
Upon Written Request, Copies Available June 2005, redesignated the national market system April 8, 2016.
From: Securities and Exchange rules previously adopted under Section 11A of the
Commission, Office of FOIA Services, Exchange Act. Rule 11Ac1–5 under the Exchange
I. Introduction
100 F Street NE., Washington, DC Act was redesignated Rule 605 of Regulation NMS. On December 28, 2015, BATS
No substantive amendments were made to Rule 605
20549–2736. of Regulation NMS. See Securities Exchange Act
Exchange, Inc. (‘‘Exchange’’) filed with
Release No. 51808 (June 9, 2005), 70 FR 37496 (June the Securities and Exchange
17 17 CFR 200.30–3(a)(12). 29, 2005). Commission (‘‘Commission’’), pursuant
VerDate Sep<11>2014 17:56 Apr 13, 2016 Jkt 238001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 E:\FR\FM\14APN1.SGM 14APN1](https://thefederalregister.org/doc/81_FR_22212/page/4.svg)
Document Created: 2018-02-07 13:48:16
Document Modified: 2018-02-07 13:48:16
| 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 | 81 FR 22140 |
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR