81_FR_23137 81 FR 23062 - Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Certificate of Incorporation of the Exchange's Ultimate Parent Company, Bats Global Markets, Inc.

81 FR 23062 - Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Certificate of Incorporation of the Exchange's Ultimate Parent Company, Bats Global Markets, Inc.

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 75 (April 19, 2016)

Page Range23062-23064
FR Document2016-08944

Federal Register, Volume 81 Issue 75 (Tuesday, April 19, 2016)
[Federal Register Volume 81, Number 75 (Tuesday, April 19, 2016)]
[Notices]
[Pages 23062-23064]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-08944]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77608; File No. SR-BatsEDGA-2016-05]


Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change To 
Amend the Certificate of Incorporation of the Exchange's Ultimate 
Parent Company, Bats Global Markets, Inc.

April 13, 2016.
    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 April 8, 2016, Bats EDGA Exchange, Inc. (the ``Exchange'' or 
``EDGA'') 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.
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    \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).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend the certificate of 
incorporation of the Exchange's ultimate parent company, Bats Global 
Markets, Inc. (the ``Corporation'').
    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
    On December 16, 2015, the Corporation, the ultimate parent entity 
of the Exchange, filed a registration statement on Form S-1 with the 
Commission seeking to register shares of common stock and to conduct an 
initial public offering of those shares, which will be listed for 
trading on the Exchange (the ``IPO''). In connection with its IPO, the 
Corporation intends to amend and restate its certificate of 
incorporation (the ``New Certificate of Incorporation''). The Exchange 
previously received Commission approval of certain substantive 
amendments to the certificate of incorporation of the Corporation that 
comprise changes included in the New Certificate of Incorporation.\5\ 
Since that date, the Corporation has determined it to be necessary to 
further amend its certificate of incorporation to achieve the final, 
pre-IPO version of the New

[[Page 23063]]

Certificate of Incorporation. The additional amendments will be 
achieved through the filing with the State of Delaware of a certificate 
of amendment to the New Certificate of Incorporation. The additional 
amendments are described in further detail below.
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    \5\ See Securities Exchange Act Release No. 77464 (March 29, 
2016), 81 FR 19252 (April 1, 2016) (SR-BATS-2016-010; SR-BYX-2016-
02; SR-EDGX-2016-04; SR-EDGA-2016-01).
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    The Exchange, on behalf of the Corporation, proposes changes to the 
New Certificate of Incorporation in connection with a forward stock 
split, pursuant to which each share of common stock of the Corporation 
outstanding or held in treasury immediately prior to the completion of 
the IPO would automatically and without action on the part of the 
holders thereof be subdivided into 2.91 shares of common stock (the 
``Stock Split'').\6\ Accordingly, the number of authorized shares of 
the Corporation, both in the aggregate and as set forth by class, as 
codified in paragraph (a)(i) of Article Fourth of the New Certificate 
of Incorporation, will be adjusted. The Corporation also plans to 
adjust the preferred stock of the Corporation consistent with the Stock 
Split. The par value of the Corporation's common stock will remain 
$0.01 per share.
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    \6\ Common stock consists of voting common stock and non-voting 
common stock of the Corporation.
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    The purpose of this rule filing is to permit the Corporation, the 
ultimate parent company of the Exchange, to adopt an amendment to the 
New Certificate of Incorporation, as described in this proposal. The 
changes described herein relate to the certificate of incorporation of 
the Corporation only, not to the governance of the Exchange. The 
Exchange will continue to be governed by its existing certificate of 
incorporation and bylaws. The stock in, and voting power of, the 
Exchange will continue to be directly and solely held by Bats Global 
Markets Holdings, Inc., an intermediate holding company wholly-owned by 
the Corporation, and the governance of the Exchange will continue under 
its existing structure.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with the 
requirements of the Act and 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.\7\ In particular, the 
proposal is consistent with Section 6(b)(1) of the Act, because it 
retains, without modification, the existing limitations on ownership 
and total voting power that currently exist and that are designed to 
prevent any stockholder from exercising undue control over the 
operation of the Exchange and to assure that the Exchange is able to 
carry out its regulatory obligations under the Act. Under the proposal, 
the Corporation is making certain administrative and structural changes 
to the New Certificate of Incorporation. These changes, however, do not 
impact the governance of the Exchange nor do they modify the ownership 
of the Corporation.
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    \7\ 15 U.S.C. 78f(b).
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change imposes 
any burden on competition. As described above, the proposed rule change 
is simply to make certain administrative and structural changes to the 
New Certificate of Incorporation. These changes do not impact the 
governance of the Exchange nor do they modify the ownership of the 
Corporation.

(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 written comments from members or other interested parties.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \8\ and Rule 19b-4(f)(6) thereunder.\9\ 
Because the proposed rule change does not: (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 30 
days from the date on which it was filed, or such shorter time as the 
Commission may designate, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act \10\ and Rule 19b-
4(f)(6) thereunder.\11\
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    \8\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \9\ 17 CFR 240.19b-4(f)(6).
    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ In addition, Rule 19b-4(f)(6)(iii) requires the Exchange to 
give the Commission written notice of the Exchange's 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. The Exchange has satisfied this 
requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) under the Act 
\12\ normally does not become operative for 30 days after the date of 
filing. However, Rule 19b-4(f)(6)(iii) \13\ permits the Commission to 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposal 
may become operative immediately upon filing. The Exchange states that 
the Corporation's IPO may occur in the near future, and the changes 
described in this notice are a critical component of such IPO. The 
Exchange states that waiver of the operative delay will allow the 
Corporation to promptly move forward with the IPO without delay. The 
Commission notes that the Exchange represents that there are no changes 
to the provisions of the New Certificate of Incorporation that impact 
the ownership or governance of the Exchange, and that instead, the 
amendments reflect administrative and structural amendments to the New 
Certificate of Incorporation. Based on the foregoing, the Commission 
believes that waiving the 30-day operative delay is consistent with the 
protection of investors and the public interest.\14\ The Commission 
hereby grants the Exchange's request and designates the proposal 
operative upon filing.
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    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
    \14\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

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

[[Page 23064]]

Electronic Comments

     Use 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-BatsEDGA-2016-05 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-BatsEDGA-2016-05. 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-BatsEDGA-2016-05 and should 
be submitted on or before May 10, 2016.
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    \15\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-08944 Filed 4-18-16; 8:45 am]
 BILLING CODE 8011-01-P



                                                  23062                          Federal Register / Vol. 81, No. 75 / Tuesday, April 19, 2016 / Notices

                                                  or governance of the Exchange, and that                 proposed rule change between the                      Commission is publishing this notice to
                                                  instead, the amendments reflect                         Commission and any person, other than                 solicit comments on the proposed rule
                                                  administrative and structural                           those that may be withheld from the                   change from interested persons.
                                                  amendments to the New Certificate of                    public in accordance with the
                                                                                                                                                                I. Self-Regulatory Organization’s
                                                  Incorporation. Based on the foregoing,                  provisions of 5 U.S.C. 552, will be
                                                                                                                                                                Statement of the Terms of Substance of
                                                  the Commission believes that waiving                    available for Web site viewing and
                                                                                                          printing in the Commission’s Public                   the Proposed Rule Change
                                                  the 30-day operative delay is consistent
                                                  with the protection of investors and the                Reference Room, 100 F Street NE.,                        The Exchange filed a proposal to
                                                  public interest.14 The Commission                       Washington, DC 20549, on official                     amend the certificate of incorporation of
                                                  hereby grants the Exchange’s request                    business days between the hours of                    the Exchange’s ultimate parent
                                                  and designates the proposal operative                   10:00 a.m. and 3:00 p.m. Copies of the                company, Bats Global Markets, Inc. (the
                                                  upon filing.                                            filing also will be available for                     ‘‘Corporation’’).
                                                     At any time within 60 days of the                    inspection and copying at the principal                  The text of the proposed rule change
                                                  filing of the proposed rule change, the                 office of the Exchange. All comments                  is available at the Exchange’s Web site
                                                  Commission summarily may                                received will be posted without change;               at www.batstrading.com, at the
                                                  temporarily suspend such rule change if                 the Commission does not edit personal                 principal office of the Exchange, and at
                                                  it appears to the Commission that such                  identifying information from                          the Commission’s Public Reference
                                                  action is necessary or appropriate in the               submissions. You should submit only                   Room.
                                                  public interest, for the protection of                  information that you wish to make                     II. Self-Regulatory Organization’s
                                                  investors, or otherwise in furtherance of               available publicly. All submissions                   Statement of the Purpose of, and
                                                  the purposes of the Act. If the                         should refer to File Number SR–                       Statutory Basis for, the Proposed Rule
                                                  Commission takes such action, the                       BatsBZX–2016–07 and should be                         Change
                                                  Commission shall institute proceedings                  submitted on or before May 10, 2016.
                                                  to determine whether the proposed rule                                                                           In its filing with the Commission, the
                                                                                                            For the Commission, by the Division of
                                                  should be approved or disapproved.                      Trading and Markets, pursuant to delegated
                                                                                                                                                                Exchange included statements
                                                                                                          authority.15                                          concerning the purpose of and basis for
                                                  IV. Solicitation of Comments                                                                                  the proposed rule change and discussed
                                                                                                          Robert W. Errett,
                                                    Interested persons are invited to                                                                           any comments it received on the
                                                                                                          Deputy Secretary.
                                                  submit written data, views, and                                                                               proposed rule change. The text of these
                                                                                                          [FR Doc. 2016–08939 Filed 4–18–16; 8:45 am]
                                                  arguments concerning the foregoing,                                                                           statements may be examined at the
                                                  including whether the proposed rule                     BILLING CODE 8011–01–P
                                                                                                                                                                places specified in Item IV below. The
                                                  change is consistent with the Act.                                                                            Exchange has prepared summaries, set
                                                  Comments may be submitted by any of                                                                           forth in Sections A, B, and C below, of
                                                                                                          SECURITIES AND EXCHANGE
                                                  the following methods:                                                                                        the most significant parts of such
                                                                                                          COMMISSION
                                                  Electronic Comments                                                                                           statements.
                                                                                                          [Release No. 34–77608; File No. SR-
                                                    • Use the Commission’s Internet                       BatsEDGA–2016–05]                                     (A) Self-Regulatory Organization’s
                                                  comment form (http://www.sec.gov/                                                                             Statement of the Purpose of, and
                                                  rules/sro.shtml); or                                    Self-Regulatory Organizations; Bats                   Statutory Basis for, the Proposed Rule
                                                    • Send an email to rule-comments@                     EDGA Exchange, Inc.; Notice of Filing                 Change
                                                  sec.gov. Please include File Number SR–                 and Immediate Effectiveness of a
                                                                                                                                                                1. Purpose
                                                  BatsBZX–2016–07 on the subject line.                    Proposed Rule Change To Amend the
                                                                                                          Certificate of Incorporation of the                      On December 16, 2015, the
                                                  Paper Comments                                          Exchange’s Ultimate Parent Company,                   Corporation, the ultimate parent entity
                                                    • Send paper comments in triplicate                   Bats Global Markets, Inc.                             of the Exchange, filed a registration
                                                  to Secretary, Securities and Exchange                                                                         statement on Form S–1 with the
                                                  Commission, 100 F Street NE.,                           April 13, 2016.                                       Commission seeking to register shares of
                                                  Washington, DC 20549–1090.                                 Pursuant to Section 19(b)(1) of the                common stock and to conduct an initial
                                                  All submissions should refer to File                    Securities Exchange Act of 1934 (the                  public offering of those shares, which
                                                  Number SR–BatsBZX–2016–07. This file                    ‘‘Act’’),1 and Rule 19b–4 thereunder,2                will be listed for trading on the
                                                  number should be included on the                        notice is hereby given that on April 8,               Exchange (the ‘‘IPO’’). In connection
                                                  subject line if email is used. To help the              2016, Bats EDGA Exchange, Inc. (the                   with its IPO, the Corporation intends to
                                                  Commission process and review your                      ‘‘Exchange’’ or ‘‘EDGA’’) filed with the              amend and restate its certificate of
                                                  comments more efficiently, please use                   Securities and Exchange Commission                    incorporation (the ‘‘New Certificate of
                                                  only one method. The Commission will                    (‘‘Commission’’) the proposed rule                    Incorporation’’). The Exchange
                                                  post all comments on the Commission’s                   change as described in Items I and II                 previously received Commission
                                                  Internet Web site (http://www.sec.gov/                  below, which Items have been prepared                 approval of certain substantive
                                                  rules/sro.shtml). Copies of the                         by the Exchange. The Exchange has                     amendments to the certificate of
                                                  submission, all subsequent                              designated this proposal as a ‘‘non-                  incorporation of the Corporation that
                                                  amendments, all written statements                      controversial’’ proposed rule change                  comprise changes included in the New
                                                  with respect to the proposed rule                       pursuant to Section 19(b)(3)(A) of the                Certificate of Incorporation.5 Since that
                                                  change that are filed with the                          Act 3 and Rule 19b–4(f)(6)(iii)                       date, the Corporation has determined it
mstockstill on DSK4VPTVN1PROD with NOTICES




                                                  Commission, and all written                             thereunder,4 which renders it effective               to be necessary to further amend its
                                                  communications relating to the                          upon filing with the Commission. The                  certificate of incorporation to achieve
                                                                                                                                                                the final, pre-IPO version of the New
                                                                                                            15 17 CFR 200.30–3(a)(12).
                                                     14 For purposes only of waiving the 30-day
                                                                                                            1 15 U.S.C. 78s(b)(1).
                                                  operative delay, the Commission has also                                                                        5 See Securities Exchange Act Release No. 77464
                                                                                                            2 17 CFR 240.19b–4.
                                                  considered the proposed rule’s impact on                                                                      (March 29, 2016), 81 FR 19252 (April 1, 2016) (SR–
                                                                                                            3 15 U.S.C. 78s(b)(3)(A).
                                                  efficiency, competition, and capital formation. See                                                           BATS–2016–010; SR–BYX–2016–02; SR–EDGX–
                                                  15 U.S.C. 78c(f).                                         4 17 CFR 240.19b–4(f)(6)(iii).                      2016–04; SR–EDGA–2016–01).



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                                                                                 Federal Register / Vol. 81, No. 75 / Tuesday, April 19, 2016 / Notices                                                      23063

                                                  Certificate of Incorporation. The                       stockholder from exercising undue                          A proposed rule change filed under
                                                  additional amendments will be                           control over the operation of the                       Rule 19b–4(f)(6) under the Act 12
                                                  achieved through the filing with the                    Exchange and to assure that the                         normally does not become operative for
                                                  State of Delaware of a certificate of                   Exchange is able to carry out its                       30 days after the date of filing. However,
                                                  amendment to the New Certificate of                     regulatory obligations under the Act.                   Rule 19b–4(f)(6)(iii) 13 permits the
                                                  Incorporation. The additional                           Under the proposal, the Corporation is                  Commission to designate a shorter time
                                                  amendments are described in further                     making certain administrative and                       if such action is consistent with the
                                                  detail below.                                           structural changes to the New Certificate               protection of investors and the public
                                                    The Exchange, on behalf of the                        of Incorporation. These changes,                        interest. The Exchange has asked the
                                                  Corporation, proposes changes to the                    however, do not impact the governance
                                                                                                                                                                  Commission to waive the 30-day
                                                  New Certificate of Incorporation in                     of the Exchange nor do they modify the
                                                  connection with a forward stock split,                                                                          operative delay so that the proposal may
                                                                                                          ownership of the Corporation.
                                                  pursuant to which each share of                                                                                 become operative immediately upon
                                                                                                          (B) Self-Regulatory Organization’s                      filing. The Exchange states that the
                                                  common stock of the Corporation
                                                                                                          Statement on Burden on Competition                      Corporation’s IPO may occur in the near
                                                  outstanding or held in treasury
                                                  immediately prior to the completion of                    The Exchange does not believe that                    future, and the changes described in this
                                                  the IPO would automatically and                         the proposed rule change imposes any                    notice are a critical component of such
                                                  without action on the part of the holders               burden on competition. As described                     IPO. The Exchange states that waiver of
                                                  thereof be subdivided into 2.91 shares of               above, the proposed rule change is                      the operative delay will allow the
                                                  common stock (the ‘‘Stock Split’’).6                    simply to make certain administrative                   Corporation to promptly move forward
                                                  Accordingly, the number of authorized                   and structural changes to the New                       with the IPO without delay. The
                                                  shares of the Corporation, both in the                  Certificate of Incorporation. These                     Commission notes that the Exchange
                                                  aggregate and as set forth by class, as                 changes do not impact the governance                    represents that there are no changes to
                                                  codified in paragraph (a)(i) of Article                 of the Exchange nor do they modify the                  the provisions of the New Certificate of
                                                  Fourth of the New Certificate of                        ownership of the Corporation.                           Incorporation that impact the ownership
                                                  Incorporation, will be adjusted. The                    (C) Self-Regulatory Organization’s                      or governance of the Exchange, and that
                                                  Corporation also plans to adjust the                    Statement on Comments on the                            instead, the amendments reflect
                                                  preferred stock of the Corporation                      Proposed Rule Change Received From                      administrative and structural
                                                  consistent with the Stock Split. The par                Members, Participants or Others                         amendments to the New Certificate of
                                                  value of the Corporation’s common                                                                               Incorporation. Based on the foregoing,
                                                                                                            The Exchange has not solicited, and
                                                  stock will remain $0.01 per share.                                                                              the Commission believes that waiving
                                                    The purpose of this rule filing is to                 does not intend to solicit, comments on
                                                                                                          this proposed rule change. The                          the 30-day operative delay is consistent
                                                  permit the Corporation, the ultimate
                                                                                                          Exchange has not received any written                   with the protection of investors and the
                                                  parent company of the Exchange, to
                                                                                                          comments from members or other                          public interest.14 The Commission
                                                  adopt an amendment to the New
                                                  Certificate of Incorporation, as described              interested parties.                                     hereby grants the Exchange’s request
                                                  in this proposal. The changes described                                                                         and designates the proposal operative
                                                                                                          III. Date of Effectiveness of the
                                                  herein relate to the certificate of                     Proposed Rule Change and Timing for                     upon filing.
                                                  incorporation of the Corporation only,                  Commission Action                                          At any time within 60 days of the
                                                  not to the governance of the Exchange.                     The Exchange has filed the proposed                  filing of the proposed rule change, the
                                                  The Exchange will continue to be                        rule change pursuant to Section                         Commission summarily may
                                                  governed by its existing certificate of                 19(b)(3)(A)(iii) of the Act 8 and Rule                  temporarily suspend such rule change if
                                                  incorporation and bylaws. The stock in,                 19b–4(f)(6) thereunder.9 Because the                    it appears to the Commission that such
                                                  and voting power of, the Exchange will                  proposed rule change does not: (i)                      action is necessary or appropriate in the
                                                  continue to be directly and solely held                 Significantly affect the protection of                  public interest, for the protection of
                                                  by Bats Global Markets Holdings, Inc.,                  investors or the public interest; (ii)                  investors, or otherwise in furtherance of
                                                  an intermediate holding company                         impose any significant burden on                        the purposes of the Act. If the
                                                  wholly-owned by the Corporation, and                    competition; and (iii) become operative                 Commission takes such action, the
                                                  the governance of the Exchange will                     for 30 days from the date on which it                   Commission shall institute proceedings
                                                  continue under its existing structure.                  was filed, or such shorter time as the                  to determine whether the proposed rule
                                                  2. Statutory Basis                                      Commission may designate, if                            should be approved or disapproved.
                                                     The Exchange believes that its                       consistent with the protection of
                                                                                                          investors and the public interest, the                  IV. Solicitation of Comments
                                                  proposal is consistent with the
                                                  requirements of the Act and rules and                   proposed rule change has become                           Interested persons are invited to
                                                  regulations thereunder that are                         effective pursuant to Section 19(b)(3)(A)               submit written data, views, and
                                                  applicable to a national securities                     of the Act 10 and Rule 19b–4(f)(6)                      arguments concerning the foregoing,
                                                  exchange, and, in particular, with the                  thereunder.11
                                                                                                                                                                  including whether the proposed rule
                                                  requirements of Section 6(b) of the Act.7                 8 15
                                                                                                                                                                  change is consistent with the Act.
                                                                                                                 U.S.C. 78s(b)(3)(A)(iii).
                                                  In particular, the proposal is consistent                 9 17 CFR 240.19b–4(f)(6).                             Comments may be submitted by any of
                                                  with Section 6(b)(1) of the Act, because                  10 15 U.S.C. 78s(b)(3)(A).                            the following methods:
mstockstill on DSK4VPTVN1PROD with NOTICES




                                                  it retains, without modification, the                     11 In addition, Rule 19b–4(f)(6)(iii) requires the

                                                  existing limitations on ownership and                   Exchange to give the Commission written notice of         12 17  CFR 240.19b–4(f)(6).
                                                  total voting power that currently exist                 the Exchange’s intent to file the proposed rule           13 17  CFR 240.19b–4(f)(6)(iii).
                                                                                                          change, along with a brief description and text of
                                                  and that are designed to prevent any                    the proposed rule change, at least five business days
                                                                                                                                                                     14 For purposes only of waiving the 30-day

                                                                                                          prior to the date of filing of the proposed rule        operative delay, the Commission has also
                                                    6 Common stock consists of voting common stock
                                                                                                          change, or such shorter time as designated by the       considered the proposed rule’s impact on
                                                  and non-voting common stock of the Corporation.         Commission. The Exchange has satisfied this             efficiency, competition, and capital formation. See
                                                    7 15 U.S.C. 78f(b).                                   requirement.                                            15 U.S.C. 78c(f).



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                                                  23064                            Federal Register / Vol. 81, No. 75 / Tuesday, April 19, 2016 / Notices

                                                  Electronic Comments                                       SECURITIES AND EXCHANGE                               would be considered setting interest
                                                                                                            COMMISSION                                            even if a Limit Order designated Add
                                                    • Use the Commission’s Internet                                                                               Liquidity Only (‘‘ALO’’) or sell short
                                                  comment form (http://www.sec.gov/                         [Release No. 34–77603; File No. SR–NYSE–
                                                                                                            2016–28]
                                                                                                                                                                  order during a Short Sale Period, as
                                                  rules/sro.shtml); or                                                                                            defined in Rule 440B(d), is re-priced
                                                    • Send an email to rule-comments@                       Self-Regulatory Organizations; New                    and displayed at the same price as such
                                                  sec.gov. Please include File Number SR–                   York Stock Exchange LLC; Notice of                    interest that became the Exchange BBO.
                                                  BatsEDGA–2016–05 on the subject line.                     Filing and Immediate Effectiveness of                 Background
                                                                                                            Proposed Rule Change Amending Rule
                                                  Paper Comments                                            72 Relating to Setting Interest                          Under Rule 72(a)(ii), a bid or offer,
                                                                                                                                                                  including pegging interest, is considered
                                                    • Send paper comments in triplicate                     April 13, 2016.                                       the ‘‘setting interest’’ when it is
                                                  to Secretary, Securities and Exchange                        Pursuant to section 19(b)(1) 1 of the              established as the only displayable bid
                                                  Commission, 100 F Street NE.,                             Securities Exchange Act of 1934 (the                  or offer made at a particular price and
                                                  Washington, DC 20549–1090.                                ‘‘Act’’) 2 and Rule 19b–4 thereunder,3                is the only displayable interest when
                                                                                                            notice is hereby given that on March 29,              such price is or becomes the Exchange
                                                  All submissions should refer to File
                                                                                                            2016, New York Stock Exchange LLC                     BBO. Setting interest is entitled to
                                                  Number SR–BatsEDGA–2016–05. This
                                                                                                            (‘‘NYSE’’ or the ‘‘Exchange’’) filed with             priority for allocation of executions at
                                                  file number should be included on the                                                                           that price, as provided for under Rule
                                                                                                            the Securities and Exchange
                                                  subject line if email is used. To help the                Commission (the ‘‘Commission’’) the                   72. If there is no setting interest, all
                                                  Commission process and review your                        proposed rule change as described in                  interest is allocated on parity pursuant
                                                  comments more efficiently, please use                     Items I, II, and III below, which Items               to Rule 72(c).4
                                                  only one method. The Commission will                      have been prepared by the self-                          In 2008, when the Exchange added
                                                  post all comments on the Commission’s                     regulatory organization. The                          the current form of Rule 72, current
                                                  Internet Web site (http://www.sec.gov/                    Commission is publishing this notice to               paragraph (a)(ii)(G) of the rule provided
                                                  rules/sro.shtml). Copies of the                           solicit comments on the proposed rule                 that if, at the time non-pegging interest
                                                  submission, all subsequent                                change from interested persons.                       becomes the Exchange BBO, an e-Quote
                                                  amendments, all written statements                                                                              is pegging to such non-pegging interest,
                                                                                                            I. Self-Regulatory Organization’s                     all such interest was considered to be
                                                  with respect to the proposed rule
                                                                                                            Statement of the Terms of Substance of                entered simultaneously and, therefore,
                                                  change that are filed with the                            the Proposed Rule Change
                                                  Commission, and all written                                                                                     no interest was considered the setting
                                                  communications relating to the                               The Exchange proposes to amend                     interest.5 Because the Exchange
                                                  proposed rule change between the                          Rule 72 relating to setting interest. The             believed that permitting pegging e-
                                                                                                            proposed rule change is available on the              Quotes to eliminate the priority to
                                                  Commission and any person, other than
                                                                                                            Exchange’s Web site at www.nyse.com,                  which a non-pegging e-Quote might
                                                  those that may be withheld from the
                                                                                                            at the principal office of the Exchange,              otherwise be entitled could
                                                  public in accordance with the
                                                                                                            and at the Commission’s Public                        disincentivize aggressive displayed
                                                  provisions of 5 U.S.C. 552, will be                       Reference Room.                                       quoting, the Exchange amended Rule
                                                  available for Web site viewing and                                                                              72(a)(ii)(G) to provide that non-pegging
                                                  printing in the Commission’s Public                       II. Self-Regulatory Organization’s
                                                                                                                                                                  interest that becomes the Exchange BBO
                                                  Reference Room, 100 F Street NE.,                         Statement of the Purpose of, and
                                                                                                                                                                  will be considered the setting interest
                                                  Washington, DC 20549, on official                         Statutory Basis for, the Proposed Rule
                                                                                                                                                                  even if an e-Quote is pegging to such
                                                  business days between the hours of                        Change
                                                                                                                                                                  non-pegging interest.6 The Exchange’s
                                                  10:00 a.m. and 3:00 p.m. Copies of the                       In its filing with the Commission, the             goal in providing priority to setting
                                                  filing also will be available for                         self-regulatory organization included                 interest was to create an incentive for
                                                  inspection and copying at the principal                   statements concerning the purpose of,                 participants to display aggressive prices.
                                                  office of the Exchange. All comments                      and basis for, the proposed rule change               The Exchange amended Rule 72(a)(ii)(G)
                                                  received will be posted without change;                   and discussed any comments it received                in 2011 because it believed a participant
                                                  the Commission does not edit personal                     on the proposed rule change. The text                 may be reluctant to enter such displayed
                                                  identifying information from                              of those statements may be examined at                interest if a non-displayed pegging e-
                                                  submissions. You should submit only                       the places specified in Item IV below.                Quote could deny priority to such
                                                  information that you wish to make                         The Exchange has prepared summaries,                  displayed interest.7 Because pegging
                                                  available publicly. All submissions                       set forth in sections A, B, and C below,              interest cannot peg to other pegging
                                                  should refer to File Number SR–                           of the most significant parts of such
                                                                                                            statements.                                             4 See  Rule 72(c)(v).
                                                  BatsEDGA–2016–05 and should be                                                                                    5 See  Securities Exchange Act Release Nos. 58845
                                                  submitted on or before May 10, 2016.                      A. Self-Regulatory Organization’s                     (Oct. 24, 2008), 73 FR 64379 (Oct. 29, 2008)
                                                    For the Commission, by the Division of                  Statement of the Purpose of, and the                  (Approval Order) and 58184 (July 17, 2008), 73 FR
                                                  Trading and Markets, pursuant to delegated                Statutory Basis for, the Proposed Rule                42853, (July 23, 2008) (Notice) (SR–NYSE–2008–
                                                                                                            Change                                                46). See also Rule 70 (defining e-Quotes and d-
                                                  authority.15                                                                                                    Quotes).
                                                  Robert W. Errett,                                         1. Purpose                                               6 See Securities Exchange Act Release No. 65889

                                                                                                                                                                  (Dec. 5, 2011), 76 FR 77040 (Dec. 9, 2011) (SR–
mstockstill on DSK4VPTVN1PROD with NOTICES




                                                  Deputy Secretary.                                            The Exchange proposes to amend                     NYSE–2011–60) (Notice of filing and immediate
                                                  [FR Doc. 2016–08944 Filed 4–18–16; 8:45 am]               Rule 72 relating to setting interest to               effectiveness of proposed rule change amended
                                                  BILLING CODE 8011–01–P                                    provide that interest that establishes a              Rule 72).
                                                                                                                                                                     7 Because the Exchange does not publicly identify
                                                                                                            new Exchange best bid or offer (‘‘BBO’’)
                                                                                                                                                                  interest as pegging interest that is eligible to re-price
                                                                                                                                                                  based on changes to the PBBO, a participant seeking
                                                                                                              1 15 U.S.C. 78s(b)(1).                              to set the Exchange BBO would be unaware that one
                                                                                                              2 15 U.S.C. 78a.                                    or more pegging interest could join it at the
                                                    15 17   CFR 200.30–3(a)(12).                              3 17 CFR 240.19b–4.                                 Exchange BBO.



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Document Created: 2016-04-19 00:15:59
Document Modified: 2016-04-19 00:15:59
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation81 FR 23062 

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