81 FR 35075 - Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 11.7, Opening Process
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 105 (June 1, 2016)
Federal Register Volume 81, Issue 105 (June 1, 2016)
| Page Range | 35075-35078 | |
| FR Document | 2016-12791 |
[Federal Register Volume 81, Number 105 (Wednesday, June 1, 2016)] [Notices] [Pages 35075-35078] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-12791] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-77906; File No. SR-BatsEDGA-2016-10] Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 11.7, Opening Process May 25, 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 May 13, 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 [[Page 35076]] Act \3\ and Rule 19b-4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ 15 U.S.C. 78s(b)(3)(A). \4\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to amend Rule 11.7, Opening Process, to await a two-sided quotation from the listing exchange prior to opening a security for trading during Regular Trading Hours.\5\ --------------------------------------------------------------------------- \5\ See Exchange Rule 1.5(y). --------------------------------------------------------------------------- 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 the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Rule 11.7, Opening Process, to await a two-sided quotation from the listing exchange prior to opening a security for trading during Regular Trading Hours. Exchange Rule 11.7 describes the Exchange's current opening process. Subparagraph (a) to Rule 11.7 states that prior to the beginning of the Regular Session,\6\ Users \7\ who wish to participate in the Opening Process may enter orders to buy or sell.\8\ Subparagraph (a)(2) to Rule 11.7 provides that, with certain exceptions,\9\ all orders with a time-in-force instruction of Regular Hours Only may participate in the Opening Process. Subparagraph (b) to Rule 11.7 states that the Exchange will open by performing the Opening Process in which the System will attempt to match buy and sell orders that are executable at the midpoint of the National Best Bid and Offer (``NBBO''). Subparagraph (c) to Exchange Rule 11.7 sets forth the process by which the System sets the opening price of the Opening Process. Currently, the System \10\ sets the price of the Opening Process at the midpoint of the first NBBO after 9:30:00 a.m. Eastern Time. However, for securities listed on either the New York Stock Exchange, Inc. (``NYSE'') or NYSE MKT LLC (``NYSE MKT''), the System currently sets the price of the Opening Process at the midpoint of the first NBBO subsequent to the first reported trade on the listing exchange after 9:30:00 a.m. Eastern Time. The Exchange may alternatively set the price of the Opening Process for securities listed on either the NYSE or NYSE MKT at the midpoint of the then prevailing NBBO when the first two-sided quotation published by the relevant listing exchange after 9:30:00 a.m. Eastern Time, but before 9:45:00 a.m. Eastern Time if no first trade is reported by the listing exchange within one second of publication of the first two-sided quotation by the listing exchange. The System waits to set the price at the midpoint of the first NBBO as set forth above because securities listed on the NYSE or NYSE MKT may not open at precisely 9:30:00 a.m. Eastern Time. --------------------------------------------------------------------------- \6\ See Exchange Rule 1.5(hh). \7\ See Exchange Rule 1.5(ee). \8\ Orders cancelled prior to the Opening Process will not participate in the Opening Process. \9\ The following order types and instruction may not participate in the opening process: (i) Limit Orders with a Post Only instruction, (ii) the Discretionary Range of Limit Orders, and (iv) Intermarket Sweep Orders (``ISOs'') not modified by Rule 11.7(a)(1), and (iii) orders with a Minimum Execution Quantity instruction. See Exchange Rule 11.7(a)(2). Orders that are designated for the Regular Session that cannot participate in the Opening Process will not be accepted by the System until the Opening Process is completed or a Contingent Opening. Id. Limit Orders with a Reserve Quantity may participate to the full extent of their displayed size and Reserve Quantity. Id. Limit Orders with a Discretionary Range may participate up to their ranked limit price for buy orders and down to their ranked limit price for sell orders. Id. All Limit Orders with a Pegged instruction will be eligible for execution in the Opening Process based on their pegged prices at the time the Opening Process is conducted. Id. \10\ See Exchange Rule 1.5(cc). --------------------------------------------------------------------------- Pursuant to subparagraph (b) of Rule 11.7, all orders executable at the midpoint of the NBBO will continue to be processed in time sequence, beginning with the order with the oldest time stamp and not in accordance with Exchange Rule 11.9(a)(2)(B), which outlines priority at the midpoint of the NBBO. Matches occur until there are no remaining contra-side orders or there is an imbalance of orders. An imbalance of orders may result in orders that cannot be executed in whole or in part. Any unexecuted orders may then be placed by the System on the EDGA Book,\11\ cancelled, executed, or routed to away Trading Centers in accordance with the Users' instructions pursuant to Exchange Rule 11.11. --------------------------------------------------------------------------- \11\ The term ``EDGA Book'' is defined as ``the System's electronic file of orders.'' See Exchange Rule 1.5(d). --------------------------------------------------------------------------- The Exchange proposes to amend subparagraph (c) to Rule 11.7 to now await a two-sided quotation from the listing exchange prior to opening a security for trading during Regular Trading Hours. As amended, subparagraph (c)(2) to Rule 11.7 would state that the System would set the price of the Opening Process at the midpoint of the first NBBO subsequent to the first two-sided quotation published by the listing exchange after 9:30:00 a.m. Eastern Time. For securities listed on either the NYSE or NYSE MKT, subparagraph (c)(1)(i) to Rule 11.7 would state that the System would set the price of the Opening Process at the midpoint of the first NBBO subsequent to the first reported trade and first reported quotation on the listing exchange after 9:30:00 a.m. Eastern Time. Pursuant to subparagraph (c)(1)(i) to Rule 11.7, the Exchange will utilize the existing NBBO to calculate each securities' [sic] opening price once a trade and two-sided quotation are received from the listing exchange, regardless of the order in which the trade or quotation are received. The Exchange believes the proposed rule change will enable the listing market's quotation to be incorporated into the NBBO, which the Exchange would, in turn, utilize in its calculation of the midpoint of the NBBO. The Exchange believes doing so would result in an opening price that more closely reflect the opening market prices and conditions for that security. Under subparagraph (c)(1)(ii) to Rule 11.7, the Exchange will continue to alternatively set the price of the Opening Process for securities listed on either the NYSE or NYSE MKT at the midpoint of the then prevailing NBBO when the first two-sided quotation published by the relevant listing exchange after 9:30:00 a.m. Eastern Time, but before 9:45:00 a.m. Eastern Time if no first trade is reported by the listing exchange within one second of publication of the first two-sided quotation by the listing exchange. [[Page 35077]] 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act \12\ in general, and furthers the objectives of Section 6(b)(5) of the Act \13\ in particular, in that it is designed to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in 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. The Exchange believes the proposed rule change will promote just and equitable principles of trade, removes impediments to, and perfect the mechanism of, a free and open market and a national market system because it enables the System to execute the Opening Process at a price that is objectively established by the market for the security. The proposal would enable the listing market's quotation to be incorporated into the NBBO, which the Exchange would, in turn, utilize in its calculation of the midpoint of the NBBO. The Exchange believes doing so would result in an opening price that more closely reflect the opening market prices and conditions for that security. Therefore, the Exchange believes the proposed rule change promotes just and equitable principles of trade because it ensures a midpoint price that the Exchange believes would accurately reflect the market for the security. --------------------------------------------------------------------------- \12\ 15 U.S.C. 78f(b). \13\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposal will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change will enable the Exchange to incorporate the listing market's quotation into its calculation of the midpoint of the NBBO, resulting in an opening price that would more closely reflect the opening market prices and conditions for that security. Therefore, the Exchange believes the proposed rule change will promote competition by enhancing the quality of the Exchange's opening process. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has neither solicited nor received written comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the 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) of the Act \14\ and Rule 19b-4(f)(6) thereunder.\15\ --------------------------------------------------------------------------- \14\ 15 U.S.C. 78s(b)(3)(A). \15\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b- 4(f)(6)(iii), the Exchange provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and the 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. --------------------------------------------------------------------------- A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act \16\ normally does not become operative for 30 days after the date of its filing. However, Rule 19b-4(f)(6)(iii) \17\ 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 waiver of the 30-day operative delay would allow market participants to immediately realize the benefits of what may be more accurate opening prices. Based on the foregoing, the Commission believes the waiver of the operative delay is consistent with the protection of investors and the public interest. Therefore, the Commission hereby waives the operative delay and designates the proposal operative upon filing.\18\ --------------------------------------------------------------------------- \16\ 17 CFR 240.19b-4(f)(6). \17\ 17 CFR 240.19b-4(f)(6)(iii). \18\ 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). --------------------------------------------------------------------------- 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 change 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 No. SR-BatsEDGA-2016-10 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File No. SR-BatsEDGA-2016-10. 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 No. SR-BatsEDGA-2016-10, and should be submitted on or before June 22, 2016. [[Page 35078]] For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\19\ --------------------------------------------------------------------------- \19\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Brent J. Fields, Secretary. [FR Doc. 2016-12791 Filed 5-31-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 105 / Wednesday, June 1, 2016 / Notices 35075
of the Act 3 in general, and furthers the III. Date of Effectiveness of the rules/sro.shtml). Copies of the
objectives of Section 6(b)(5) of the Act 4 Proposed Rule Change and Timing for submission, all subsequent
in particular, in that it is designed to Commission Action amendments, all written statements
protect investors and the public interest Because the foregoing proposed rule with respect to the proposed rule
by streamlining various aspects of the change does not: (i) Significantly affect change that are filed with the
membership process. The Exchange the protection of investors or the public Commission, and all written
believes that the provisions identified in interest; (ii) impose any significant communications relating to the
Rule 900.1, 910, and 921 are outdated burden on competition; and (iii) become proposed rule change between the
and unnecessary. These rules regarding operative for 30 days from the date on Commission and any person, other than
which it was filed, or such shorter time those that may be withheld from the
partnerships and changes to the
as the Commission may designate, it has public in accordance with the
partnership rules no longer serves the
provisions of 5 U.S.C. 552, will be
needs of the Exchange. become effective pursuant to Section
available for Web site viewing and
As described above PHLX’s former 19(b)(3)(A)(iii) of the Act 5 and
printing in the Commission’s Public
subparagraph (f)(6) of Rule 19b–4
ownership required the Exchange to be Reference Room, 100 F Street NE.,
thereunder.6
vigilant of the ownership structure of its At any time within 60 days of the Washington, DC 20549, on official
members in case of financial distress or filing of the proposed rule change, the business days between the hours of
bankruptcy as the seat structure was Commission summarily may 10:00 a.m. and 3:00 p.m. Copies of the
vital to the financial condition of the temporarily suspend such rule change if filing also will be available for
Exchange and the relationships among it appears to the Commission that such inspection and copying at the principal
members. Before demutualization, action is: (i) Necessary or appropriate in office of the Exchange. All comments
members had an ownership interest in received will be posted without change;
the public interest; (ii) for the protection
the Exchange. Today, permits convey no the Commission does not edit personal
of investors; or (iii) otherwise in
ownership and therefore such vigilance identifying information from
furtherance of the purposes of the Act.
submissions. You should submit only
as to the ownership structure of If the Commission takes such action, the
information that you wish to make
members is no longer warranted. Commission shall institute proceedings
available publicly. All submissions
The removal of Rules 900.1(b) and (d), to determine whether the proposed rule
should refer to File Number SR–Phlx–
Rule 910(j) and part of 921(b) will should be approved or disapproved.
2016–38 and should be submitted on or
promote just and equitable principles of IV. Solicitation of Comments before June 22, 2016.
trade, and foster cooperation and Interested persons are invited to For the Commission, by the Division of
coordination with persons engaged in submit written data, views and Trading and Markets, pursuant to delegated
facilitating transactions in securities by arguments concerning the foregoing, authority.7
removing burdensome requirements so including whether the proposed rule Brent J. Fields,
that members and member organizations change is consistent with the Act. Secretary.
may properly focus on other relevant Comments may be submitted by any of [FR Doc. 2016–12778 Filed 5–31–16; 8:45 am]
requirements which benefit the the following methods: BILLING CODE 8011–01–P
marketplace.
Electronic Comments
B. Self-Regulatory Organization’s • Use the Commission’s Internet SECURITIES AND EXCHANGE
Statement on Burden on Competition comment form (http://www.sec.gov/ COMMISSION
The proposed rule change does not rules/sro.shtml); or
[Release No. 34–77906; File No. SR–
• Send an email to rule-comments@ BatsEDGA–2016–10]
impose any burden on competition that sec.gov. Please include File Number SR–
is not necessary or appropriate in Phlx–2016–38 on the subject line.
furtherance of the purposes of the Act. Self-Regulatory Organizations; Bats
Paper Comments EDGA Exchange, Inc.; Notice of Filing
The Exchange’s proposed amendments
and Immediate Effectiveness of a
seek to delete certain unnecessary rules • Send paper comments in triplicate Proposed Rule Change to Rule 11.7,
which today burden partnerships over to Secretary, Securities and Exchange Opening Process
corporations. The deletions of the Rules Commission, 100 F Street NE.,
900.1(b) and (d), Rule 910(j) will remove Washington, DC 20549–1090. May 25, 2016.
a current burden on competition which All submissions should refer to File Pursuant to Section 19(b)(1) of the
requires members and member Number SR–Phlx–2016–38. This file Securities Exchange Act of 1934 (the
organizations that are partnerships to number should be included on the ‘‘Act’’),1 and Rule 19b–4 thereunder,2
disclose unnecessary information as subject line if email is used. To help the notice is hereby given that on May 13,
compared to other corporate entities not Commission process and review your 2016, Bats EDGA Exchange, Inc. (the
structured as a partnership. comments more efficiently, please use ‘‘Exchange’’ or ‘‘EDGA’’) filed with the
only one method. The Commission will Securities and Exchange Commission
C. Self-Regulatory Organization’s post all comments on the Commission’s (‘‘Commission’’) the proposed rule
Statement on Comments on the Internet Web site (http://www.sec.gov/ change as described in Items I and II
Proposed Rule Change Received From below, which Items have been prepared
sradovich on DSK3TPTVN1PROD with NOTICES
Members, Participants, or Others 5 15 U.S.C. 78s(b)(3)(a)(iii) [sic]. by the Exchange. The Exchange has
6 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– designated this proposal as a ‘‘non-
No written comments were either 4(f)(6) requires a self-regulatory organization to give controversial’’ proposed rule change
solicited or received. the Commission written notice of its intent to file pursuant to Section 19(b)(3)(A) of the
the proposed rule change at least five business days
prior to the date of filing of the proposed rule
7 17 CFR 200.30–3(a)(12).
change, or such shorter time as designated by the
3 15 U.S.C. 78f(b). 1 15
Commission. The Exchange has satisfied this U.S.C. 78s(b)(1).
4 15 U.S.C. 78f(b)(5). requirement. 2 17 CFR 240.19b–4.
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![35076 Federal Register / Vol. 81, No. 105 / Wednesday, June 1, 2016 / Notices
Act 3 and Rule 19b–4(f)(6)(iii) all orders with a time-in-force an imbalance of orders. An imbalance of
thereunder,4 which renders it effective instruction of Regular Hours Only may orders may result in orders that cannot
upon filing with the Commission. The participate in the Opening Process. be executed in whole or in part. Any
Commission is publishing this notice to Subparagraph (b) to Rule 11.7 states that unexecuted orders may then be placed
solicit comments on the proposed rule the Exchange will open by performing by the System on the EDGA Book,11
change from interested persons. the Opening Process in which the cancelled, executed, or routed to away
System will attempt to match buy and Trading Centers in accordance with the
I. Self-Regulatory Organization’s
sell orders that are executable at the Users’ instructions pursuant to
Statement of the Terms of Substance of
midpoint of the National Best Bid and Exchange Rule 11.11.
the Proposed Rule Change
Offer (‘‘NBBO’’). Subparagraph (c) to
The Exchange filed a proposal to Exchange Rule 11.7 sets forth the The Exchange proposes to amend
amend Rule 11.7, Opening Process, to process by which the System sets the subparagraph (c) to Rule 11.7 to now
await a two-sided quotation from the opening price of the Opening Process. await a two-sided quotation from the
listing exchange prior to opening a Currently, the System 10 sets the price of listing exchange prior to opening a
security for trading during Regular the Opening Process at the midpoint of security for trading during Regular
Trading Hours.5 the first NBBO after 9:30:00 a.m. Eastern Trading Hours. As amended,
The text of the proposed rule change Time. However, for securities listed on subparagraph (c)(2) to Rule 11.7 would
is available at the Exchange’s Web site either the New York Stock Exchange, state that the System would set the price
at www.batstrading.com, at the Inc. (‘‘NYSE’’) or NYSE MKT LLC of the Opening Process at the midpoint
principal office of the Exchange, and at (‘‘NYSE MKT’’), the System currently of the first NBBO subsequent to the first
the Commission’s Public Reference sets the price of the Opening Process at two-sided quotation published by the
Room. the midpoint of the first NBBO listing exchange after 9:30:00 a.m.
II. Self-Regulatory Organization’s subsequent to the first reported trade on Eastern Time. For securities listed on
Statement of the Purpose of, and the listing exchange after 9:30:00 a.m. either the NYSE or NYSE MKT,
Statutory Basis for, the Proposed Rule Eastern Time. The Exchange may subparagraph (c)(1)(i) to Rule 11.7
Change alternatively set the price of the would state that the System would set
Opening Process for securities listed on
In its filing with the Commission, the the price of the Opening Process at the
either the NYSE or NYSE MKT at the
Exchange included statements midpoint of the first NBBO subsequent
midpoint of the then prevailing NBBO
concerning the purpose of and basis for to the first reported trade and first
when the first two-sided quotation
the proposed rule change and discussed reported quotation on the listing
published by the relevant listing
any comments it received on the exchange after 9:30:00 a.m. Eastern
exchange after 9:30:00 a.m. Eastern
proposed rule change. The text of these Time. Pursuant to subparagraph (c)(1)(i)
Time, but before 9:45:00 a.m. Eastern
statements may be examined at the to Rule 11.7, the Exchange will utilize
Time if no first trade is reported by the
places specified in Item IV below. The the existing NBBO to calculate each
listing exchange within one second of
Exchange has prepared summaries, set securities’ [sic] opening price once a
publication of the first two-sided
forth in Sections A, B, and C below, of trade and two-sided quotation are
quotation by the listing exchange. The
the most significant parts of such received from the listing exchange,
System waits to set the price at the
statements. regardless of the order in which the
midpoint of the first NBBO as set forth
A. Self-Regulatory Organization’s above because securities listed on the trade or quotation are received. The
Statement of the Purpose of, and the NYSE or NYSE MKT may not open at Exchange believes the proposed rule
Statutory Basis for, the Proposed Rule precisely 9:30:00 a.m. Eastern Time. change will enable the listing market’s
Change Pursuant to subparagraph (b) of Rule quotation to be incorporated into the
11.7, all orders executable at the NBBO, which the Exchange would, in
1. Purpose
midpoint of the NBBO will continue to turn, utilize in its calculation of the
The Exchange proposes to amend be processed in time sequence, midpoint of the NBBO. The Exchange
Rule 11.7, Opening Process, to await a beginning with the order with the oldest believes doing so would result in an
two-sided quotation from the listing time stamp and not in accordance with opening price that more closely reflect
exchange prior to opening a security for Exchange Rule 11.9(a)(2)(B), which the opening market prices and
trading during Regular Trading Hours. outlines priority at the midpoint of the
Exchange Rule 11.7 describes the conditions for that security. Under
NBBO. Matches occur until there are no subparagraph (c)(1)(ii) to Rule 11.7, the
Exchange’s current opening process. remaining contra-side orders or there is
Subparagraph (a) to Rule 11.7 states that Exchange will continue to alternatively
prior to the beginning of the Regular set the price of the Opening Process for
Discretionary Range of Limit Orders, and (iv)
Session,6 Users 7 who wish to Intermarket Sweep Orders (‘‘ISOs’’) not modified by securities listed on either the NYSE or
participate in the Opening Process may Rule 11.7(a)(1), and (iii) orders with a Minimum NYSE MKT at the midpoint of the then
Execution Quantity instruction. See Exchange Rule prevailing NBBO when the first two-
enter orders to buy or sell.8 11.7(a)(2). Orders that are designated for the Regular
Subparagraph (a)(2) to Rule 11.7 Session that cannot participate in the Opening
sided quotation published by the
provides that, with certain exceptions,9 Process will not be accepted by the System until the relevant listing exchange after 9:30:00
Opening Process is completed or a Contingent a.m. Eastern Time, but before 9:45:00
3 15 U.S.C. 78s(b)(3)(A). Opening. Id. Limit Orders with a Reserve Quantity a.m. Eastern Time if no first trade is
may participate to the full extent of their displayed
sradovich on DSK3TPTVN1PROD with NOTICES
4 17 CFR 240.19b–4(f)(6)(iii).
size and Reserve Quantity. Id. Limit Orders with a reported by the listing exchange within
5 See Exchange Rule 1.5(y).
Discretionary Range may participate up to their one second of publication of the first
6 See Exchange Rule 1.5(hh).
ranked limit price for buy orders and down to their two-sided quotation by the listing
7 See Exchange Rule 1.5(ee).
ranked limit price for sell orders. Id. All Limit
8 Orders cancelled prior to the Opening Process Orders with a Pegged instruction will be eligible for
exchange.
will not participate in the Opening Process. execution in the Opening Process based on their
9 The following order types and instruction may pegged prices at the time the Opening Process is 11 The term ‘‘EDGA Book’’ is defined as ‘‘the
not participate in the opening process: (i) Limit conducted. Id. System’s electronic file of orders.’’ See Exchange
Orders with a Post Only instruction, (ii) the 10 See Exchange Rule 1.5(cc). Rule 1.5(d).
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![35078 Federal Register / Vol. 81, No. 105 / Wednesday, June 1, 2016 / Notices
For the Commission, by the Division of II. Self-Regulatory Organization’s The Exchange proposes to implement
Trading and Markets, pursuant to delegated Statement of the Purpose of, and the proposed rule change immediately.
authority.19 Statutory Basis for, the Proposed Rule
Brent J. Fields, 2. Statutory Basis
Change
Secretary. The Exchange believes that the
In its filing with the Commission, the
[FR Doc. 2016–12791 Filed 5–31–16; 8:45 am] Exchange included statements proposed rule change is consistent with
BILLING CODE 8011–01–P concerning the purpose of and basis for the objectives of Section 6 of the Act,9
the proposed rule change and discussed in general, and furthers the objectives of
any comments it received on the Section 6(b)(4),10 in particular, as it is
SECURITIES AND EXCHANGE proposed rule change. The text of these designed to provide for the equitable
COMMISSION statements may be examined at the allocation of reasonable dues, fees and
[Release No. 34–77918; File No. SR– places specified in Item IV below. The other charges among its Members and
BatsBYX–2016–10] Exchange has prepared summaries, set other persons using its facilities. The
forth in Sections A, B, and C below, of Exchange believes that its proposed
Self-Regulatory Organizations; Bats the most significant parts of such rates represent an equitable allocation of
BYX Exchange, Inc.; Notice of Filing statements. reasonable dues, fees, and other charges
and Immediate Effectiveness of a among Members and other persons
Proposed Rule Change Related to Fees A. Self-Regulatory Organization’s using its facilities because it is designed
Statement of the Purpose of, and the to reinsert fee code PX, which was
May 25, 2016. Statutory Basis for, the Proposed Rule inadvertently deleted in an earlier rule
Pursuant to Section 19(b)(1) of the Change filing. The Exchange does not believe
Securities Exchange Act of 1934 (the that this change represents a significant
‘‘Act’’),1 and Rule 19b–4 thereunder,2 1. Purpose
departure from previous pricing offered
notice is hereby given that on May 16, On May 5, 2016, the Exchange
by the Exchange, as fee code PX will
2016, Bats BYX Exchange, Inc. (the amended Rule 11.13, Order Execution
continue to be yielded on orders that
‘‘Exchange’’ or ‘‘BYX’’) filed with the and Routing, to delete the IOCM and
utilize the RMPT routing option and
Securities and Exchange Commission ICMT routing options.6 At that time, the
will be charged the same rates as set
(‘‘Commission’’) the proposed rule Exchange also amended its Fee
forth in the Fe Schedule prior to its
change as described in Items I, II and III Schedule to delete: (i) References to the
mistaken deletion. Furthermore, the
below, which Items have been prepared IOCM and ICMT routing options under
Exchange notes that routing through the
by the Exchange. The Exchange has footnote 8; and (ii) fee code PX, which
Exchange and utilizing fee code PX is
designated the proposed rule change as was yielded on orders routed to Bats
voluntary. Lastly, the Exchange also
one establishing or changing a member EDGX Exchange, Inc. (‘‘EDGX’’) to
believes that the proposed amendment
due, fee, or other charge imposed by the execute against MidPoint Peg Orders 7
is non-discriminatory because it applies
Exchange under Section 19(b)(3)(A)(ii) on EDGX using ICMT or IOCM routing
uniformly to all Members.
of the Act 3 and Rule 19b–4(f)(2) options. Fee code PX is also yielded on
thereunder,4 which renders the orders routed using the RMPT routing B. Self-Regulatory Organization’s
proposed rule change effective upon option.8 In that filing, the Exchange Statement on Burden on Competition
filing with the Commission. The inadvertently deleted fee code PX in its
entirety when fee code PX should have This proposed rule change does not
Commission is publishing this notice to
only been amended to delete references impose any burden on competition that
solicit comments on the proposed rule
to the IOCM and ICMT routing options. is not necessary or appropriate in
change from interested persons.
The Exchange now proposes to furtherance of the purposes of the Act.
I. Self-Regulatory Organization’s reinsert fee code PX, less the references The Exchange does not believe the
Statement of the Terms of Substance of to the ICMT and IOCM routing options. proposed rule change will impose any
the Proposed Rule Change The reinserted langue would state that burden on competition as it is simply
The Exchange filed a proposal to fee code PX is yielded on orders routing designed to reinsert fee code PX, which
amend the fee schedule applicable to using the RMPT routing option. Orders was that was inadvertently deleted in an
Members 5 and non-members of the that yield fee code PX in securities earlier rule filing.
Exchange pursuant to BYX Rules 15.1(a) priced at or above $1.00 are charged a C. Self-Regulatory Organization’s
and (c) (‘‘Fee Schedule’’) to reinsert fee fee of $0.00120 per share and orders in Statement on Comments on the
code PX, which was inadvertently securities priced below $1.00 are Proposed Rule Change Received From
deleted in its entirety in an earlier changed a fee of 0.29% charge of the Members, Participants, or Others
proposed rule change. order’s total dollar value. The proposed
The text of the proposed rule change rates for fee code PX are identical to that The Exchange has not solicited, and
is available at the Exchange’s Web site which was included in the Fee does not intend to solicit, comments on
at www.batstrading.com, at the Schedule prior to May 10, 2016. this proposed rule change. The
principal office of the Exchange, and at Exchange has not received any
the Commission’s Public Reference 6 See Securities Exchange Act Release No. 77790 unsolicited written comments from
Room. (May 10, 2016), 81 FR 30360 (May 16, 2016) (SR– Members or other interested parties.
BatsBYX–2016–06).
7 See EDGX Rule 11.8(d). III. Date of Effectiveness of the
sradovich on DSK3TPTVN1PROD with NOTICES
19 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
8 RMPT is a routing option under which a Mid- Proposed Rule Change and Timing for
2 17 CFR 240.19b–4.
Point Peg Order checks the System for available Commission Action
shares and any remaining shares are then sent to
3 15 U.S.C. 78s(b)(3)(A)(ii).
destinations on the System routing table that The foregoing rule change has become
4 17 CFR 240.19b–4(f)(2).
support midpoint eligible orders. If any shares effective pursuant to Section 19(b)(3)(A)
5 The term ‘‘Member’’ is defined as ‘‘any remain unexecuted after routing, they are posted on
registered broker or dealer that has been admitted the BYX Book as a MidPoint Peg Order, unless
9 15 U.S.C. 78f.
to membership in the Exchange.’’ See Exchange otherwise instructed by the User. See Exchange
Rule 1.5(n). Rule 11.13(b)(3)(Q). 10 15 U.S.C. 78f(b)(4).
VerDate Sep<11>2014 21:59 May 31, 2016 Jkt 238001 PO 00000 Frm 00110 Fmt 4703 Sfmt 4703 E:\FR\FM\01JNN1.SGM 01JNN1](https://thefederalregister.org/doc/81_FR_35180/page/4.svg)
Document Created: 2018-02-08 07:27:40
Document Modified: 2018-02-08 07:27:40
| 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 35075 |
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