81 FR 2268 - Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 7015

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 10 (January 15, 2016)

Page Range		2268-2269
FR Document		2016-00644

Federal Register, Volume 81 Issue 10 (Friday, January 15, 2016)

[Federal Register Volume 81, Number 10 (Friday, January 15, 2016)]
[Notices]
[Pages 2268-2269]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2016-00644]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76868; File No. SR-BX-2015-087]

Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend
Rule 7015

January 11, 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 December 29, 2015, NASDAQ OMX BX, Inc. (``BX'' or ``Exchange'')
filed with the Securities and Exchange Commission (``SEC'' or
``Commission'') the proposed rule change as described in Items I, II,
and III, below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

The Exchange proposes to amend BX Rule 7015 to clarify the
connectivity options and application of the fees assessed thereunder.
The text of the proposed rule change is available on the Exchange's
Web site at http://nasdaqomxbx.cchwallstreet.com, at the principal
office of the Exchange, and at the Commission's Public Reference Room.

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

In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

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

1. Purpose
Rule 7015 provides the charges BX assesses for equity securities
market connectivity to systems operated by BX. BX is amending Rule 7015
in three ways: (1) To clarify the term ``port pair''; (2) to clarify
the connectivity options available under the rule; and (3) to eliminate
internet ports as a connectivity option.
First, BX is proposing to clarify the use of the term ``port
pair.'' For certain ports under Rule 7015 that are used for either
trading or data, BX additionally provides a disaster recovery port at
no cost. Such a disaster recovery port provides connectivity to BX's
disaster recovery location in the event of a failure of BX's primary
trading infrastructure. BX has provided disaster recovery ports at no
cost since 2009 to encourage member firms to maintain such connectivity
in the event of a market disruption so that the market as a whole could
continue to operate. In the interest of clarity, the Exchange is
proposing to eliminate the term port pair and to separately list
disaster recovery ports as a connectivity option available at no cost
under the rule.
Second, BX is reorganizing and adding language to Rule 7015 to list
all connectivity provided by BX under the rule, which is currently
subsumed in a connectivity option and related fee. Specifically, the
Exchange currently offers connectivity for $500 per port, per month for
each port pair other than Multicast ITCH data feed pairs and TCP ITCH
data feed pairs. Under the $500 per port, per month connectivity option
a member firm may subscribe to an OUCH protocol trading port, a FIX
Trading Port (either a FIX or FIX Lite protocol),\3\ RASH protocol
trading port, and DROP ports. BX is listing separately each of the
options available under the rule. BX also offers trading ports that may
be used only in test mode. Member firms may subscribe to these test
mode trading ports at no cost, which are exclusively used for testing
purposes and may not be used for trading in securities in the System.
The Exchange is adding rule text noting that these test ports may be
subscribed to under the rule. The Exchange also provides data
retransmission ports at no cost. Data retransmission ports allow a
subscriber to replay market data, in the event the data was missed in a
live feed or for verification purposes. Data retransmission ports only
allow replay of the current trading day and do not provide data
concerning prior trading days' data. The Exchange is adding rule text
noting that data retransmission ports may be subscribed to under the
rule.
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\3\ A FIX port is a trading port using a FIX-based
telecommunication protocol. FIX, an abbreviation for Financial
Information eXchange, is a standard message protocol that defines an
electronic message exchange for communicating securities
transactions between two parties. BX offers two FIX-based trading
ports, which vary based on messaging formats and capability. BX is
proposing to list these two protocols as options under the rule that
a member firm may select when subscribing to a FIX trading port.
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Third, BX is proposing to eliminate Internet Ports. Internet ports
are based on outdated technology and BX does not have any subscribers
to this connectivity method.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
Section 6(b) of the Act,\4\ in general, and furthers the objectives of
Sections 6(b)(4) and 6(b)(5) of the Act,\5\ in particular, in that it
provides for the equitable allocation of reasonable dues, fees and
other charges among members and issuers and other persons using any
facility or system which BX operates or controls, and is designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to

[[Page 2269]]

remove impediments to and perfect the mechanism of a free and open
market and a national market system, and, in general, to protect
investors and the public interest; and are not designed to permit
unfair discrimination between customers, issuers, brokers, or dealers.
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\4\ 15 U.S.C. 78f(b).
\5\ 15 U.S.C. 78f(b)(4) and (5).
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The Exchange believes that the clarifying changes to the rule
protect investors and the public interest because they explicitly
describe the fees assessed for all ports under the rule. Describing all
services covered by the rule will serve to avoid investor confusion
over the scope of what connectivity options are available, and the
costs of such options. The Exchange notes that it is not adding new
connectivity options or functionality, but is rather describing more
specifically what is currently offered under the rule. In this regard,
the Exchange is adding new rule text that describes all functionality
available under each subparagraph of the rule and is reorganizing some
rule text under the rule in an effort to make the rule clearer. The
Exchange notes that much of the new text concerns testing ports and
ports used in the event of a disaster or hardware failure. These ports
help ensure that a fair and orderly market is maintained by allowing
member firms to test their systems prior to connecting to the live
trading environment and to provide backup connectivity in the event of
a failure or disaster. Thus, the Exchange believes the proposed
clarifying changes are consistent with the protection of investors and
the public interest.
The Exchange believes that the proposed deletion of the Internet
Port connectivity option is reasonable, equitably allocated, and not
unfairly discriminatory because there are no subscribers to this
connectivity option, which is based on outdated means of connecting to
the Exchange. As a consequence, no member firms will be impacted by
deletion of the connectivity option. The Exchange notes that it is not
altering the charges assessed for the remaining connectivity options
under Rule 7015.

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 that is not necessary or appropriate
in furtherance of the purposes of the Act. Specifically, BX is making
clarifying changes to Rule 7015, which does not impose any burden on
competition whatsoever. To the contrary, the proposed change
facilitates competition by clarifying what connectivity options are
provided by the Exchange, thereby informing other market venues a
better understanding of what connectivity options are available for BX.
With that better understanding, other market venues may improve
existing connectivity options or offer new connectivity options to
compete with BX. Accordingly, the proposed changes do not inhibit
market participants' ability to compete among each other, nor do they
impose any burden on competition among market venues, but rather may
promote competition among market venues.

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

No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(ii) of the Act \6\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\7\ At any time within 60
days of the filing of the proposed rule change, the Commission
summarily may temporarily suspend such rule change if it appears to the
Commission that such action is: (i) Necessary or appropriate in the
public interest; (ii) for the protection of investors; or (iii)
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.
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\6\ 15 U.S.C. 78s(b)(3)(a)(ii).
\7\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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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-BX-2015-087 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-BX-2015-087. 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-BX-2015-087 and should be
submitted on or before February 5, 2016.
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\8\ 17 CFR 200.30-3(a)(12).

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-00644 Filed 1-14-16; 8:45 am]
BILLING CODE 8011-01-P

Federal Register / Vol. 81, No. 10 / Friday, January 15, 2016 / Notices 2269

remove impediments to and perfect the by the Exchange, thereby informing Electronic Comments
mechanism of a free and open market other market venues a better
and a national market system, and, in understanding of what connectivity • Use the Commission’s Internet
general, to protect investors and the options are available for BX. With that comment form (http://www.sec.gov/
public interest; and are not designed to better understanding, other market rules/sro.shtml); or
permit unfair discrimination between venues may improve existing • Send an email to rule-comments@
customers, issuers, brokers, or dealers. connectivity options or offer new sec.gov. Please include File Number SR–
The Exchange believes that the connectivity options to compete with BX–2015–087 on the subject line.
clarifying changes to the rule protect BX. Accordingly, the proposed changes
investors and the public interest do not inhibit market participants’ Paper Comments
because they explicitly describe the fees ability to compete among each other,
assessed for all ports under the rule. • Send paper comments in triplicate
nor do they impose any burden on
Describing all services covered by the to Secretary, Securities and Exchange
competition among market venues, but
rule will serve to avoid investor rather may promote competition among Commission, 100 F Street NE.,
confusion over the scope of what market venues. Washington, DC 20549–1090.
connectivity options are available, and All submissions should refer to File
the costs of such options. The Exchange C. Self-Regulatory Organization’s
Statement on Comments on the Number SR–BX–2015–087. This file
notes that it is not adding new
Proposed Rule Change Received From number should be included on the
connectivity options or functionality,
Members, Participants, or Others subject line if email is used. To help the
but is rather describing more
specifically what is currently offered Commission process and review your
No written comments were either comments more efficiently, please use
under the rule. In this regard, the
solicited or received. only one method. The Commission will
Exchange is adding new rule text that
describes all functionality available III. Date of Effectiveness of the post all comments on the Commission’s
under each subparagraph of the rule and Proposed Rule Change and Timing for Internet Web site (http://www.sec.gov/
is reorganizing some rule text under the Commission Action rules/sro.shtml). Copies of the
rule in an effort to make the rule clearer. submission, all subsequent
The Exchange notes that much of the Because the foregoing proposed rule amendments, all written statements
new text concerns testing ports and change does not: (i) Significantly affect with respect to the proposed rule
ports used in the event of a disaster or the protection of investors or the public change that are filed with the
hardware failure. These ports help interest; (ii) impose any significant Commission, and all written
ensure that a fair and orderly market is burden on competition; and (iii) become communications relating to the
maintained by allowing member firms operative for 30 days from the date on proposed rule change between the
to test their systems prior to connecting which it was filed, or such shorter time Commission and any person, other than
to the live trading environment and to as the Commission may designate, it has
those that may be withheld from the
provide backup connectivity in the become effective pursuant to Section
public in accordance with the
event of a failure or disaster. Thus, the 19(b)(3)(A)(ii) of the Act 6 and
provisions of 5 U.S.C. 552, will be
Exchange believes the proposed subparagraph (f)(6) of Rule 19b–4
thereunder.7 At any time within 60 days available for Web site viewing and
clarifying changes are consistent with
of the filing of the proposed rule change, printing in the Commission’s Public
the protection of investors and the
the Commission summarily may Reference Room, 100 F Street NE.,
public interest.
The Exchange believes that the temporarily suspend such rule change if Washington, DC 20549, on official
proposed deletion of the Internet Port it appears to the Commission that such business days between the hours of
connectivity option is reasonable, action is: (i) Necessary or appropriate in 10:00 a.m. and 3:00 p.m. Copies of the
equitably allocated, and not unfairly the public interest; (ii) for the protection filing also will be available for
discriminatory because there are no of investors; or (iii) otherwise in inspection and copying at the principal
subscribers to this connectivity option, furtherance of the purposes of the Act. office of the Exchange. All comments
which is based on outdated means of If the Commission takes such action, the received will be posted without change;
connecting to the Exchange. As a Commission shall institute proceedings the Commission does not edit personal
consequence, no member firms will be to determine whether the proposed rule identifying information from
impacted by deletion of the connectivity should be approved or disapproved. submissions. You should submit only
option. The Exchange notes that it is not information that you wish to make
IV. Solicitation of Comments
altering the charges assessed for the available publicly. All submissions
remaining connectivity options under Interested persons are invited to should refer to File Number SR–BX–
Rule 7015. submit written data, views, and 2015–087 and should be submitted on
B. Self-Regulatory Organization’s arguments concerning the foregoing, or before February 5, 2016.
Statement on Burden on Competition including whether the proposed rule For the Commission, by the Division of
change is consistent with the Act. Trading and Markets, pursuant to delegated
The Exchange does not believe that Comments may be submitted by any of
the proposed rule change will impose authority.8
the following methods:
any burden on competition that is not Robert W. Errett,
mstockstill on DSK4VPTVN1PROD with NOTICES

necessary or appropriate in furtherance 6 15 Deputy Secretary.
U.S.C. 78s(b)(3)(a)(ii).
of the purposes of the Act. Specifically, 7 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– [FR Doc. 2016–00644 Filed 1–14–16; 8:45 am]
BX is making clarifying changes to Rule 4(f)(6) requires a self-regulatory organization to give BILLING CODE 8011–01–P
7015, which does not impose any the Commission written notice of its intent to file
burden on competition whatsoever. To the proposed rule change at least five business days
prior to the date of filing of the proposed rule
the contrary, the proposed change change, or such shorter time as designated by the
facilitates competition by clarifying Commission. The Exchange has satisfied this
what connectivity options are provided requirement. 8 17 CFR 200.30–3(a)(12).

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Document Created: 2018-02-02 12:32:06
Document Modified: 2018-02-02 12:32:06

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		81 FR 2268