81 FR 26296 - Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Update Public Disclosure of Exchange Usage of Market Data
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 84 (May 2, 2016)
Federal Register Volume 81, Issue 84 (May 2, 2016)
| Page Range | 26296-26298 | |
| FR Document | 2016-10148 |
[Federal Register Volume 81, Number 84 (Monday, May 2, 2016)] [Notices] [Pages 26296-26298] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-10148] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-77707; File No. SR-Phlx-2016-53] Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Update Public Disclosure of Exchange Usage of Market Data April 26, 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 April 21, 2016, NASDAQ PHLX LLC (``Phlx'' or ``Exchange'') 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 Exchange. 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 update Exchange Rule 3304 and to amend the public disclosure of the sources of data that the Exchange utilizes when performing (1) order handling and execution; (2) order routing; and (3) related compliance processes. The text of the proposed rule change is below. Proposed new language is italicized and deleted language is bracketed. * * * * * Rule 3304. Data Feeds Utilized The PSX System utilizes the below proprietary and network processor feeds for the handling, routing, and execution of orders, as well as for the regulatory compliance processes related to those functions. The Secondary Source of data is, where applicable, utilized only in emergency market conditions and only until those emergency conditions are resolved. ------------------------------------------------------------------------ Market center Primary source Secondary source ------------------------------------------------------------------------ A--NYSE MKT (AMEX)........... NYSE MKT CQS/UQDF. OpenBook Ultra. B--NASDAQ OMX BX............. BX ITCH 5.0..... CQS/UQDF. C--NSX....................... CQS/UQDF........ n/a. D--FINRA ADF................. CQS/UQDF........ n/a. J--DirectEdge A.............. BATS PITCH...... CQS/UQDF. K--DirectEdge X.............. BATS PITCH...... CQS/UQDF. M--[CSX]CHX.................. [CQS/UQDF]CHX [n/a] CQS/UQDF. Book Feed. N--NYSE...................... NYSE OpenBook CQS/UQDF. Ultra. P--NYSE Arca................. NYSE ARCA XDP... CQS/UQDF. [[Page 26297]] T/Q--NASDAQ.................. ITCH 5.0........ CQS/UQDF. X--NASDAQ OMX PSX............ PSX ITCH 5.0.... CQS/UQDF. Y--BATS Y-Exchange........... BATS PITCH...... CQS/UQDF. Z--BATS Exchange............. BATS PITCH...... CQS/UQDF. ------------------------------------------------------------------------ * * * * * The text of the proposed rule change is available on the Exchange's Web site at http://nasdaqomxphlx.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 The Exchange proposes to update and amend the table in Exchange Rule 3304 that sets forth on a market-by-market basis the specific network processor and proprietary data feeds that the Exchange utilizes for the handling, routing, and execution of orders, and for performing the regulatory compliance checks related to each of those functions. Specifically, the table will be amended to update the symbol for the Chicago Stock Exchange, Inc. from ``CSX'' to ``CHX'', as well as to update the primary and secondary sources in the table for CHX. The primary source will be CHX Book Feed and the former primary source, CQS/UQDF, will become the secondary source. The change to the primary source reflects the Exchange's effort to increase the amount of data it gathers. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,\3\ in general and with Sections 6(b)(5) of the Act,\4\ in particular in that it 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 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. --------------------------------------------------------------------------- \3\ 15 U.S.C. 78f. \4\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange believes that its proposal to amend the table in Exchange Rule 3304 to update the symbol for the Chicago Stock Exchange, Inc. and to amend the primary and secondary sources of data for CHX that the Exchange utilizes when performing (1) order handling and execution; (2) order routing; and (3) related compliance processes will ensure that Exchange Rule 3304 correctly identifies and publicly states on a market-by-market basis all of the specific network processor and proprietary data feeds that the Exchange utilizes for the handling, routing, and execution of orders, and for performing the regulatory compliance checks related to each of those functions. The Exchange also believes that the proposed rule change removes impediments to and perfects the mechanism of a free and open market and protects investors and the public interest because it provides additional specificity, clarity and transparency. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act, as amended. To the contrary, the Exchange believes the proposal will enhance competition because including all of the correct information for the exchanges enhances transparency and enables investors to better assess the quality of the Exchange's execution and routing services. 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)(iii) of the Act \5\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\6\ --------------------------------------------------------------------------- \5\ 15 U.S.C. 78s(b)(3)(a)(iii). \6\ 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. --------------------------------------------------------------------------- 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. 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 [[Page 26298]] Number SR-Phlx-2016-53 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-Phlx-2016-53. 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-Phlx-2016-53 and should be submitted on or before May 23, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\7\ --------------------------------------------------------------------------- \7\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2016-10148 Filed 4-29-16; 8:45 am] BILLING CODE 8011-01-P
![26296 Federal Register / Vol. 81, No. 84 / Monday, May 2, 2016 / Notices
(3) during a SNAP Cycle; initiated SNAP functionality may result (‘‘Act’’),1 and Rule 19b–4 thereunder,2
(4) within one minute after the in more bulk executions in SNAP- notice is hereby given that on April 21,
completion of the previous SNAP Cycle; eligible securities by allowing—under 2016, NASDAQ PHLX LLC (‘‘Phlx’’ or
(5) if the CHX Routing Services are certain circumstances—SNAP AOOs ‘‘Exchange’’) filed with the Securities
not available at the time of the market queued in the Matching System to and Exchange Commission
snapshot taken pursuant to be proposed match in the absence of a valid Start (‘‘Commission’’) the proposed rule
Rule 1A(b); SNAP order. Additionally, the change as described in Items I, II, and
(6) if the NBBO ascertained from the Commission believes that the proposed
market snapshot taken pursuant to III, below, which Items have been
restrictions on when the Exchange may prepared by the Exchange. The
proposed Rule 1A(b) is crossed or a two- initiate a SNAP Cycle are reasonably
sided NBBO does not exist. Commission is publishing this notice to
designed to provide for a fair and
solicit comments on the proposed rule
III. Discussion and Commission orderly market.
Further, the Commission believes that change from interested persons.
Findings
the proposed rule change would further I. Self-Regulatory Organization’s
After careful review and minimize information leakage from
consideration, the Commission finds Statement of the Terms of Substance of
SNAP Cycles in that market participants the Proposed Rule Change
that the proposed rule change is would not know which initiating
consistent with the requirements of the mechanism triggered a particular SNAP The Exchange proposes to update
Act and the rules and regulations Cycle. Exchange Rule 3304 and to amend the
thereunder that are applicable to a For the above reasons, the public disclosure of the sources of data
national securities exchange.13 In Commission finds that the proposed that the Exchange utilizes when
particular, the Commission finds that rule change is consistent with the
the proposed rule change is consistent performing (1) order handling and
requirements of the Act. execution; (2) order routing; and (3)
with Section 6(b)(5) of the Act,14 which
requires, among other things, that the IV. Conclusion related compliance processes.
rules of a national securities exchange It is therefore ordered that, pursuant The text of the proposed rule change
be designed to promote just and to Section 19(b)(2) of the Act,17 the is below. Proposed new language is
equitable principles of trade; to remove proposed rule change (SR–CHX–2016– italicized and deleted language is
impediments to and perfect the 01) be, and hereby is, approved. bracketed.
mechanism of a free and open market For the Commission, by the Division of * * * * *
and a national market system; and, in Trading and Markets, pursuant to delegated
general, to protect investors and the authority.18 Rule 3304. Data Feeds Utilized
public interest, and that the rules of a Robert W. Errett,
national securities exchange not be The PSX System utilizes the below
Deputy Secretary.
designed to permit unfair proprietary and network processor feeds
[FR Doc. 2016–10152 Filed 4–29–16; 8:45 am]
discrimination between customers, for the handling, routing, and execution
BILLING CODE 8011–01–P
issuers, brokers or dealers. of orders, as well as for the regulatory
When it approved the SNAP, the compliance processes related to those
Commission stated that it believed that SECURITIES AND EXCHANGE functions. The Secondary Source of data
the SNAP: (1) Was reasonably designed COMMISSION is, where applicable, utilized only in
to facilitate the auction trading of emergency market conditions and only
securities on CHX in a fair and orderly [Release No. 34–77707; File No. SR–Phlx– until those emergency conditions are
manner, and could improve market 2016–53]
resolved.
quality for market participants seeking Self-Regulatory Organizations;
to execute bulk trading interests and for NASDAQ PHLX LLC; Notice of Filing
other market participants submitting and Immediate Effectiveness of
orders in response to that interest; 15 and Proposed Rule Change To Update
(2) may promote liquidity while Public Disclosure of Exchange Usage
minimizing potential information of Market Data
leakage that could disadvantage market
participants whose orders are April 26, 2016.
participating in the SNAP Cycle.16 The Pursuant to Section 19(b)(1) of the
Commission believes that the Exchange- Securities Exchange Act of 1934
Market center Primary source Secondary source
A—NYSE MKT (AMEX) .......................................................... NYSE MKT OpenBook Ultra .................................................. CQS/UQDF.
B—NASDAQ OMX BX ............................................................ BX ITCH 5.0 ........................................................................... CQS/UQDF.
C—NSX ................................................................................... CQS/UQDF ............................................................................. n/a.
D—FINRA ADF ....................................................................... CQS/UQDF ............................................................................. n/a.
J—DirectEdge A ...................................................................... BATS PITCH .......................................................................... CQS/UQDF.
K—DirectEdge X ..................................................................... BATS PITCH .......................................................................... CQS/UQDF.
srobinson on DSK5SPTVN1PROD with NOTICES
M—[CSX]CHX ......................................................................... [CQS/UQDF]CHX Book Feed ................................................ [n/a] CQS/UQDF.
N—NYSE ................................................................................ NYSE OpenBook Ultra ........................................................... CQS/UQDF.
P—NYSE Arca ........................................................................ NYSE ARCA XDP .................................................................. CQS/UQDF.
13 In approving this proposed rule change, as 14 15 U.S.C. 78f(b)(5). 17 15 U.S.C. 78s(b)(2).
amended, the Commission notes that it has 15 See Approval Order, supra note 5, 80 FR at 18 17 CFR 200.30–3(a)(12).
considered the proposed rule’s impact on 61544. 1 15 U.S.C. 78s(b)(1).
efficiency, competition, and capital formation. See 16 See id. 2 17 CFR 240.19b–4.
15 U.S.C. 78c(f).
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![26298 Federal Register / Vol. 81, No. 84 / Monday, May 2, 2016 / Notices
Number SR–Phlx–2016–53 on the Extension: Rule 17Ad-10 and SEC reporting burdens. At an
subject line. SEC File No. 270–265, OMB Control No. average staff cost of $50 per hour, the
3235–0273 industry-wide internal labor cost of
Paper Comments
Notice is hereby given that pursuant compliance (a monetization of the
• Send paper comments in triplicate to the Paperwork Reduction Act of 1995 burden hours) is approximately
to Secretary, Securities and Exchange (‘‘PRA’’) (44 U.S.C. 3501 et seq.), the $1,652,000 per year (33,040 × $50). In
Commission, 100 F Street NE., Securities and Exchange Commission addition, we estimate that each transfer
Washington, DC 20549–1090. (‘‘Commission’’) is soliciting comments agent will incur an annual external cost
All submissions should refer to File on the existing collection of information burden of $18,000 resulting from the
Number SR–Phlx–2016–53. This file provided for in Rule 17Ad–10, (17 CFR collection of information. Therefore, the
number should be included on the 240.17Ad–10), under the Securities total annual external cost on the entire
subject line if email is used. To help the Exchange Act of 1934 (15 U.S.C. 78a et transfer agent industry is approximately
Commission process and review your seq.). The Commission plans to submit $7,434,000 ($18,000 times 413). This
comments more efficiently, please use this existing collection of information to cost primarily reflects ongoing computer
only one method. The Commission will the Office of Management and Budget operations and maintenance associated
post all comments on the Commission’s (‘‘OMB’’) for extension and approval. with generating, maintaining, and
Internet Web site (http://www.sec.gov/ Rule 17Ad–10 generally requires disclosing or providing certain
rules/sro.shtml). Copies of the registered transfer agents to: (1) Create information required by the rule.
submission, all subsequent and maintain current and accurate
securityholder records; (2) promptly and The amount of time any particular
amendments, all written statements
with respect to the proposed rule accurately record all transfers, transfer agent will devote to Rule 17Ad–
change that are filed with the purchases, redemptions, and issuances, 10 compliance will vary according to
Commission, and all written and notify their appropriate regulatory the size and scope of the transfer agent’s
communications relating to the agency if they are unable to do so; (3) business activity. We note, however,
proposed rule change between the exercise diligent and continuous that at least some of the records,
Commission and any person, other than attention in resolving record processes, and communications
those that may be withheld from the inaccuracies; (4) disclose to the issuers required by Rule 17Ad–10 would likely
public in accordance with the for whom they perform transfer agent be maintained, generated, and used for
provisions of 5 U.S.C. 552, will be functions and to their appropriate transfer agent business purposes even
available for Web site viewing and regulatory agency information regarding without the rule.
printing in the Commission’s Public record inaccuracies; (5) buy-in certain Written comments are invited on: (a)
Reference Room, 100 F Street NE., record inaccuracies that result in a Whether the proposed collection of
Washington, DC 20549, on official physical over issuance of securities; and information is necessary for the proper
business days between the hours of (6) communicate with other transfer performance of the functions of the
10:00 a.m. and 3:00 p.m. Copies of the agents related to the same issuer. These Commission, including whether the
filing also will be available for requirements assist in the creation and information shall have practical utility;
inspection and copying at the principal maintenance of accurate securityholder (b) the accuracy of the Commission’s
office of the Exchange. All comments records, enhance the ability to research estimates of the burden of the proposed
received will be posted without change; errors, and ensure the transfer agent is collection of information; (c) ways to
the Commission does not edit personal aware of the number of securities that enhance the quality, utility, and clarity
identifying information from are properly authorized by the issuer, of the information collected; and (d)
submissions. You should submit only thereby avoiding over issuance. ways to minimize the burden of the
information that you wish to make The rule also has specific collection of information on
available publicly. All submissions recordkeeping requirements. It requires respondents, including through the use
should refer to File Number SR–Phlx– registered transfer agents to retain of automated collection techniques or
2016–53 and should be submitted on or certificate detail that has been deleted other forms of information technology.
before May 23, 2016. for six years and keep current an Consideration will be given to
accurate record of the number of shares comments and suggestions submitted in
For the Commission, by the Division of or principal dollar amount of debt
Trading and Markets, pursuant to delegated writing within 60 days of this
authority.7
securities that the issuer has authorized publication.
to be outstanding. These mandatory
Robert W. Errett, An agency may not conduct or
requirements ensure accurate
Deputy Secretary. securityholder records and assist the sponsor, and a person is not required to
[FR Doc. 2016–10148 Filed 4–29–16; 8:45 am] Commission and other regulatory respond to, a collection of information
BILLING CODE 8011–01–P agencies with monitoring transfer agents under the PRA unless it displays a
and ensuring compliance with the rule. currently valid OMB control number.
This rule does not involve the collection Please direct your written comments
SECURITIES AND EXCHANGE of confidential information. to: Pamela Dyson, Director/Chief
COMMISSION There are approximately 413 Information Officer, Securities and
registered transfer agents. We estimate Exchange Commission, c/o Remi Pavlik-
Proposed Collection; Comment
that the average number of hours Simon, 100 F Street NE., Washington,
Request
necessary for each transfer agent to DC 20549, or send an email to: PRA_
srobinson on DSK5SPTVN1PROD with NOTICES
Upon Written Request, Copies Available comply with Rule 17Ad–10 is Mailbox@sec.gov.
From: Securities and Exchange approximately 80 hours per year, which Dated: April 26, 2016.
Commission, Office of FOIA Services, generates an industry-wide annual
burden of 33,040 hours (413 times 80 Robert W. Errett,
100 F Street NE., Washington, DC
20549–0213 hours). This burden is of a Deputy Secretary.
recordkeeping nature but also includes [FR Doc. 2016–10108 Filed 4–29–16; 8:45 am]
7 17 CFR 200.30–3(a)(12). a small amount of third party disclosure BILLING CODE 8011–01–P
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Document Created: 2016-04-30 13:34:53
Document Modified: 2016-04-30 13:34:53
| 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 26296 |
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