81 FR 39299 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Extension of the Exchange's Penny Pilot Program and Replacement of Penny Pilot Issues That Have Been Delisted
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 116 (June 16, 2016)
Federal Register Volume 81, Issue 116 (June 16, 2016)
| Page Range | 39299-39301 | |
| FR Document | 2016-14208 |
[Federal Register Volume 81, Number 116 (Thursday, June 16, 2016)] [Notices] [Pages 39299-39301] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-14208] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-78037; File No. SR-NASDAQ-2016-052] Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Extension of the Exchange's Penny Pilot Program and Replacement of Penny Pilot Issues That Have Been Delisted June 10, 2016. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given that on June 8, 2016, The NASDAQ Stock Market LLC (``Nasdaq'' or ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``Commission'') the proposed rule change as described in Items I and II, below, which Items have been prepared by NASDAQ. 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 Nasdaq is filing with the Commission a proposal to amend Chapter VI, Section 5 (Minimum Increments) \3\ of the rules of the NASDAQ Options Market (``NOM'') to extend through December 31, 2016 or the date of permanent approval, if earlier, the Penny Pilot Program in options classes in certain issues (``Penny Pilot'' or ``Pilot''), and to change the date when delisted classes may be replaced in the Penny Pilot.\4\ --------------------------------------------------------------------------- \3\ References herein to Chapter and Series refer to rules of the NASDAQ Options Market (``NOM''), unless otherwise noted. \4\ The Penny Pilot was established in March 2008 and was last extended in 2014. See Securities Exchange Act Release Nos. 57579 (March 28, 2008), 73 FR 18587 (April 4, 2008) (SR-NASDAQ-2008-026) (notice of filing and immediate effectiveness establishing Penny Pilot); and 75283 (June 24, 2015), 80 FR 37347 (June 30, 2015) (SR- NASDAQ-2015-063) (notice of filing and immediate effectiveness extending the Penny Pilot through June 30, 2016). --------------------------------------------------------------------------- The text of the amended Exchange rule is set forth immediately below. Proposed new language is underlined and proposed deleted language is [bracketed]. NASDAQ Stock Market Rules Options Rules * * * * * Chapter VI Trading Systems * * * * * Sec. 5 Minimum Increments (a) The Board may establish minimum quoting increments for options contracts traded on NOM. Such minimum increments established by the Board will be designated as a stated policy, practice, or interpretation with respect to the administration of this Section within the meaning of Section 19 of the Exchange Act and will be filed with the SEC as a rule change for effectiveness upon filing. Until such time as the Board makes a change in the increments, the following principles shall apply: (1)-(2) No Change. (3) For a pilot period scheduled to expire on [June 30]December 31, 2016 or the date of permanent approval, if earlier, if the options series is trading pursuant to the Penny Pilot program one (1) cent if the options series is trading at less than $3.00, five (5) cents if the options series is trading at $3.00 or higher, unless for QQQQs, SPY and IWM where the minimum quoting increment will be one cent for all series regardless of price. A list of such options shall be communicated to membership via an Options Trader Alert (``OTA'') posted on the Exchange's Web site. The Exchange may replace any pilot issues that have been delisted with the next most actively traded multiply listed options classes that are not yet included in the pilot, based on trading activity in the previous six months. The replacement issues may be added to the pilot on the second trading day following July 1, [2015]2016[ and January 1, 2016]. (4) No Change. (b) No Change. * * * * * The text of the proposed rule change is available from Nasdaq's Web site at http://nasdaq.cchwallstreet.com, at Nasdaq's principal office, 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, Nasdaq 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. Nasdaq has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to amend Chapter VI, Section 5 to extend the Penny Pilot through December 31, 2016 or the date of permanent approval, if earlier,\5\ and to change the date when delisted classes may be replaced in the Penny Pilot. The Exchange believes that extending the Penny Pilot will allow for further analysis of the Penny Pilot and a determination of how the program should be structured in the future. --------------------------------------------------------------------------- \5\ The options exchanges in the U.S. that have pilot programs similar to the Penny Pilot (together ``pilot programs'') are currently working on a proposal for permanent approval of the respective pilot programs. --------------------------------------------------------------------------- Under the Penny Pilot, the minimum price variation for all participating options classes, except for the Nasdaq-100 Index Tracking Stock (``QQQQ''), the SPDR S&P 500 Exchange Traded Fund (``SPY'') and the iShares Russell 2000 Index Fund (``IWM''), is $0.01 for all quotations in options series that are quoted at less than $3 per contract and $0.05 for all quotations in options series that are quoted at $3 per contract or greater. QQQQ, SPY and IWM are quoted in $0.01 increments for all options series. The Penny Pilot is currently scheduled to expire on June 30, 2016. The Exchange proposes to extend the time period of the Penny Pilot through December 31, 2016 or the date of permanent approval, if earlier, and to provide a revised date for adding replacement issues to the Penny Pilot. The Exchange proposes that any Penny Pilot Program issues that have been delisted may be replaced on the second trading day following July 1, 2016. The replacement issues will be selected based on trading activity in the previous six months.\6\ --------------------------------------------------------------------------- \6\ The replacement issues will be announced to the Exchange's membership via an Options Trader Alert (OTA) posted on the Exchange's Web site. The Exchange proposes in its Penny Pilot rule that replacement issues will be selected based on trading activity in the previous six months. The replacement issues would be identified based on The Options Clearing Corporation's trading volume data. For example, for the July replacement, trading volume from December 1, 2015 through May 30, 2016 would be analyzed. The month immediately preceding the replacement issues' addition to the Pilot Program (i.e., June) would not be used for purposes of the six-month analysis. --------------------------------------------------------------------------- [[Page 39300]] This filing does not propose any substantive changes to the Penny Pilot Program; all classes currently participating in the Penny Pilot will remain the same and all minimum increments will remain unchanged. The Exchange believes the benefits to public customers and other market participants who will be able to express their true prices to buy and sell options have been demonstrated to outweigh the potential increase in quote traffic. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\7\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\8\ 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 facilitating transactions in securities, and 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. --------------------------------------------------------------------------- \7\ 15 U.S.C. 78f(b). \8\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- In particular, the proposed rule change, which extends the Penny Pilot for an additional six months through December 31, 2016 or the date of permanent approval, if earlier, and changes the date for replacing Penny Pilot issues that were delisted to the second trading day following July 1, 2016, will enable public customers and other market participants to express their true prices to buy and sell options for the benefit of all market participants. This is consistent with the Act. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, this proposal is pro-competitive because it allows Penny Pilot issues to continue trading on the Exchange. Moreover, the Exchange believes that the proposed rule change will allow for further analysis of the Pilot and a determination of how the Pilot should be structured in the future; and will serve to promote regulatory clarity and consistency, thereby reducing burdens on the marketplace and facilitating investor protection. The Pilot is an industry-wide initiative supported by all other option exchanges. The Exchange believes that extending the Pilot will allow for continued competition between market participants on the Exchange trading similar products as their counterparts on other exchanges, while at the same time allowing the Exchange to continue to compete for order flow with other exchanges in option issues trading as part of the Pilot. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments were neither solicited nor received. 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 \9\ and Rule 19b-4(f)(6) thereunder.\10\ 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 prior to 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 and Rule 19b- 4(f)(6)(iii) thereunder. --------------------------------------------------------------------------- \9\ 15 U.S.C. 78s(b)(3)(A)(iii). \10\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- A proposed rule change filed under Rule 19b-4(f)(6) \11\ normally does not become operative prior to 30 days after the date of the filing.\12\ However, pursuant to Rule 19b-4(f)(6)(iii),\13\ the Commission may 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 Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because doing so will allow the Pilot Program to continue without interruption in a manner that is consistent with the Commission's prior approval of the extension and expansion of the Pilot Program and will allow the Exchange and the Commission additional time to analyze the impact of the Pilot Program. Accordingly, the Commission designates the proposed rule change as operative upon filing with the Commission.\14\ --------------------------------------------------------------------------- \11\ 17 CFR 240.19b-4(f)(6). \12\ 17 CFR 240.19b-4(f)(6). 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 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. The Exchange has satisfied this pre-filing requirement. \13\ 17 CFR 240.19b-4(f)(6)(iii). \14\ For purposes only of waiving the operative delay for this proposal, the Commission has 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 such 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 under Section 19(b)(2)(B) \15\ of the Act to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \15\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-NASDAQ-2016-052 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, Station Place, 100 F Street NE., Washington, DC 20549-9303. All submissions should refer to File Number SR-NASDAQ-2016-052. 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 [[Page 39301]] 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 NASDAQ. 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-NASDAQ-2016-052 and should be submitted on or before July 7, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\16\ --------------------------------------------------------------------------- \16\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert Errett, Deputy Secretary. [FR Doc. 2016-14208 Filed 6-15-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 116 / Thursday, June 16, 2016 / Notices 39299
By the Commission. NASDAQ Stock Market Rules may be examined at the places specified
Jill M. Peterson,
Options Rules in Item IV below. Nasdaq has prepared
Assistant Secretary. summaries, set forth in sections A, B,
[FR Doc. 2016–14379 Filed 6–14–16; 4:15 pm]
* * * * * and C below, of the most significant
BILLING CODE 8011–01–P Chapter VI Trading Systems aspects of such statements.
* * * * * A. Self-Regulatory Organization’s
Statement of the Purpose of, and
SECURITIES AND EXCHANGE Sec. 5 Minimum Increments Statutory Basis for, the Proposed Rule
COMMISSION
(a) The Board may establish minimum Change
[Release No. 34–78037; File No. SR– quoting increments for options contracts
NASDAQ–2016–052] 1. Purpose
traded on NOM. Such minimum
increments established by the Board The purpose of this filing is to amend
Self-Regulatory Organizations; The will be designated as a stated policy, Chapter VI, Section 5 to extend the
NASDAQ Stock Market LLC; Notice of practice, or interpretation with respect Penny Pilot through December 31, 2016
Filing and Immediate Effectiveness of to the administration of this Section or the date of permanent approval, if
a Proposed Rule Change Relating to within the meaning of Section 19 of the earlier,5 and to change the date when
Extension of the Exchange’s Penny Exchange Act and will be filed with the delisted classes may be replaced in the
Pilot Program and Replacement of SEC as a rule change for effectiveness Penny Pilot. The Exchange believes that
Penny Pilot Issues That Have Been extending the Penny Pilot will allow for
upon filing. Until such time as the
Delisted further analysis of the Penny Pilot and
Board makes a change in the
June 10, 2016. increments, the following principles a determination of how the program
Pursuant to Section 19(b)(1) of the shall apply: should be structured in the future.
Securities Exchange Act of 1934 (1)–(2) No Change. Under the Penny Pilot, the minimum
(‘‘Act’’),1 and Rule 19b–4 2 thereunder, (3) For a pilot period scheduled to price variation for all participating
notice is hereby given that on June 8, expire on [June 30]December 31, 2016 or options classes, except for the Nasdaq–
2016, The NASDAQ Stock Market LLC the date of permanent approval, if 100 Index Tracking Stock (‘‘QQQQ’’),
(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the earlier, if the options series is trading the SPDR S&P 500 Exchange Traded
Securities and Exchange Commission pursuant to the Penny Pilot program one Fund (‘‘SPY’’) and the iShares Russell
(‘‘SEC’’ or ‘‘Commission’’) the proposed (1) cent if the options series is trading 2000 Index Fund (‘‘IWM’’), is $0.01 for
rule change as described in Items I and at less than $3.00, five (5) cents if the all quotations in options series that are
II, below, which Items have been options series is trading at $3.00 or quoted at less than $3 per contract and
prepared by NASDAQ. The Commission higher, unless for QQQQs, SPY and $0.05 for all quotations in options series
is publishing this notice to solicit IWM where the minimum quoting that are quoted at $3 per contract or
comments on the proposed rule change increment will be one cent for all series greater. QQQQ, SPY and IWM are
from interested persons. regardless of price. A list of such quoted in $0.01 increments for all
options shall be communicated to options series. The Penny Pilot is
I. Self-Regulatory Organization’s membership via an Options Trader Alert currently scheduled to expire on June
Statement of the Terms of Substance of (‘‘OTA’’) posted on the Exchange’s Web 30, 2016.
the Proposed Rule Change site. The Exchange proposes to extend the
Nasdaq is filing with the Commission The Exchange may replace any pilot time period of the Penny Pilot through
a proposal to amend Chapter VI, Section issues that have been delisted with the December 31, 2016 or the date of
5 (Minimum Increments) 3 of the rules next most actively traded multiply permanent approval, if earlier, and to
of the NASDAQ Options Market listed options classes that are not yet provide a revised date for adding
(‘‘NOM’’) to extend through December included in the pilot, based on trading replacement issues to the Penny Pilot.
31, 2016 or the date of permanent activity in the previous six months. The The Exchange proposes that any Penny
approval, if earlier, the Penny Pilot replacement issues may be added to the Pilot Program issues that have been
Program in options classes in certain pilot on the second trading day delisted may be replaced on the second
issues (‘‘Penny Pilot’’ or ‘‘Pilot’’), and to following July 1, [2015]2016[ and trading day following July 1, 2016. The
change the date when delisted classes January 1, 2016]. replacement issues will be selected
may be replaced in the Penny Pilot.4 (4) No Change. based on trading activity in the previous
The text of the amended Exchange (b) No Change. six months.6
rule is set forth immediately below. * * * * *
Proposed new language is underlined The text of the proposed rule change 5 The options exchanges in the U.S. that have
and proposed deleted language is is available from Nasdaq’s Web site at pilot programs similar to the Penny Pilot (together
[bracketed]. http://nasdaq.cchwallstreet.com, at ‘‘pilot programs’’) are currently working on a
Nasdaq’s principal office, and at the proposal for permanent approval of the respective
1 15 U.S.C. 78s(b)(1). pilot programs.
2 17
Commission’s Public Reference Room. 6 The replacement issues will be announced to
CFR 240.19b–4.
3 References herein to Chapter and Series refer to
II. Self-Regulatory Organization’s the Exchange’s membership via an Options Trader
rules of the NASDAQ Options Market (‘‘NOM’’), Alert (OTA) posted on the Exchange’s Web site. The
Statement of the Purpose of, and
asabaliauskas on DSK3SPTVN1PROD with NOTICES
unless otherwise noted. Exchange proposes in its Penny Pilot rule that
4 The Penny Pilot was established in March 2008 Statutory Basis for, the Proposed Rule replacement issues will be selected based on
and was last extended in 2014. See Securities Change trading activity in the previous six months. The
Exchange Act Release Nos. 57579 (March 28, 2008), replacement issues would be identified based on
73 FR 18587 (April 4, 2008) (SR–NASDAQ–2008– In its filing with the Commission, The Options Clearing Corporation’s trading volume
026) (notice of filing and immediate effectiveness Nasdaq included statements concerning data. For example, for the July replacement, trading
establishing Penny Pilot); and 75283 (June 24, the purpose of and basis for the volume from December 1, 2015 through May 30,
2015), 80 FR 37347 (June 30, 2015) (SR–NASDAQ– 2016 would be analyzed. The month immediately
2015–063) (notice of filing and immediate
proposed rule change and discussed any preceding the replacement issues’ addition to the
effectiveness extending the Penny Pilot through comments it received on the proposed Pilot Program (i.e., June) would not be used for
June 30, 2016). rule change. The text of these statements purposes of the six-month analysis.
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![Federal Register / Vol. 81, No. 116 / Thursday, June 16, 2016 / Notices 39301
communications relating to the Commission is publishing this notice to provides that, with certain exceptions,7
proposed rule change between the solicit comments on the proposed rule all orders with a time-in-force
Commission and any person, other than change from interested persons. instruction of Regular Hours Only may
those that may be withheld from the participate in the Opening Process.
I. Self-Regulatory Organization’s
public in accordance with the Subparagraph (e)(1) to Rule 11.7 states
Statement of the Terms of Substance of
provisions of 5 U.S.C. 552, will be that the Re-Opening Process will occur
available for Web site viewing and the Proposed Rule Change in the same manner described in Rule
printing in the Commission’s Public The Exchange is proposing to amend 11.7(a)(2) and (b) described above,8 also
Reference Room, 100 F Street NE., Rule 11.7, Opening Process, to await a with certain exceptions.9
Washington, DC 20549, on official two-sided quotation from the listing Subparagraph (e)(1) to Exchange Rule
business days between the hours of exchange prior to re-opening a security 11.7 also sets forth the process by which
10:00 a.m. and 3:00 p.m. Copies of the for trading following a halt, suspension, the System sets the price of the Re-
filing also will be available for or pause in trading. Opening Process. Currently, the
inspection and copying at the principal System 10 sets the price of the Re-
The text of the proposed rule change
office of NASDAQ. All comments Opening Process at the midpoint of the:
is available at the Exchange’s Web site
received will be posted without change; (i) First NBBO subsequent to the first
at www.batstrading.com, at the
the Commission does not edit personal reported trade on the listing exchange
principal office of the Exchange, and at
identifying information from following the resumption of trading
the Commission’s Public Reference
submissions. You should submit only after a halt, suspension, or pause; or (ii)
Room.
information that you wish to make NBBO when the first two-sided
available publicly. II. Self-Regulatory Organization’s quotation is published by the listing
All submissions should refer to File Statement of the Purpose of, and exchange following the resumption of
Number SR–NASDAQ–2016–052 and Statutory Basis for, the Proposed Rule trading after a halt, suspension, or pause
should be submitted on or before July 7, Change if no first trade is reported by the listing
2016. exchange within one second of
In its filing with the Commission, the publication of the first two-sided
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
Exchange included statements quotation by the listing exchange.
authority.16 concerning the purpose of and basis for The Exchange proposes to amend
Robert Errett, the proposed rule change and discussed subparagraph (e)(1) to Rule 11.7 to now
Deputy Secretary.
any comments it received on the await a two-sided quotation from the
proposed rule change. The text of these listing exchange prior to opening a
[FR Doc. 2016–14208 Filed 6–15–16; 8:45 am]
statements may be examined at the
BILLING CODE 8011–01–P
places specified in Item IV below. The 7 The following order types and instruction may
Exchange has prepared summaries, set not participate in the opening process: Limit Orders
forth in Sections A, B, and C below, of with a Post Only instruction, the Discretionary
SECURITIES AND EXCHANGE Range of Limit Orders, ISOs not modified by Rule
COMMISSION the most significant parts of such 11.7(a)(1), and orders with a Minimum Execution
statements. Quantity instruction. See Exchange Rule 11.7(a)(2).
[Release No. 34–78038; File No. SR- Limit Orders with a Reserve Quantity may
BatsEDGA–2016–13] A. Self-Regulatory Organization’s participate to the full extent of their displayed size
Statement of the Purpose of, and the and Reserve Quantity. Id. Limit Orders with a
Self-Regulatory Organizations; Bats Statutory Basis for, the Proposed Rule Discretionary Range may participate up to their
Change ranked limit price for buy orders or down to their
EDGA Exchange, Inc.; Notice of Filing ranked limit price for sell orders. Id. All Limit
and Immediate Effectiveness of a Orders with a Pegged instruction, as defined in
1. Purpose
Proposed Rule Change to Rule 11.7, Exchange Rule 11.6(i), will be eligible for execution
Opening Process The Exchange proposes to amend in the Opening Process based on their pegged
prices. Id.
Rule 11.7, Opening Process, to await a
June 10, 2016. 8 Subparagraph (b) to Rule 11.7 states that the
two-sided quotation from the listing Exchange will open by performing the Opening
Pursuant to Section 19(b)(1) of the
exchange prior to re-opening a security Process in which the System will attempt to match
Securities Exchange Act of 1934 (the buy and sell orders that are executable at the
for trading following a halt, suspension,
‘‘Act’’),1 and Rule 19b–4 thereunder,2 midpoint of the National Best Bid and Offer
or pause in trading.
notice is hereby given that on June 9, (‘‘NBBO’’). Furthermore, subparagraph (b) of Rule
2016, Bats EDGA Exchange, Inc. (the Exchange Rule 11.7 describes the 11.7 also states that all orders executable at the
Exchange’s current Opening and Re- midpoint of the NBBO will continue to be
‘‘Exchange’’ or ‘‘EDGA’’) filed with the processed in time sequence, beginning with the
Securities and Exchange Commission Opening Process. Subparagraph (e) to order with the oldest time stamp. Matches occur
(‘‘Commission’’) the proposed rule Rule 11.7 states that while a security is until there are no remaining contra-side orders or
change as described in Items I and II subject to a halt, suspension, or pause there is an imbalance of orders. An imbalance of
in trading, the Exchange will accept orders may result in orders that cannot be executed
below, which Items have been prepared in whole or in part. Any unexecuted orders may
by the Exchange. The Exchange has orders for queuing prior to the then be placed by the System on the EDGA Book,
designated this proposal as a ‘‘non- resumption of trading in the security for cancelled, executed, or routed to away Trading
controversial’’ proposed rule change participation in the Re-Opening Process. Centers in accordance with the Users’ instructions
Subparagraph (a) to Rule 11.7 states pursuant to Exchange Rule 11.11.
pursuant to Section 19(b)(3)(A) of the 9 Orders without a time-in-force (‘‘TIF’’)
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Act 3 and Rule 19b–4(f)(6)(iii) that, prior to the beginning of the
instruction of Regular Hours Only are eligible to
thereunder,4 which renders it effective Regular Trading Hours, Users 5 who participate in the Re-Opening Process, but orders
upon filing with the Commission. The wish to participate in the Opening that include a TIF instruction of IOC or FOK, a Post
Process may enter orders to buy or sell.6 Only instruction or Minimum Execution Quantity
16 17 Subparagraph (a)(2) to Rule 11.7 instruction will be cancelled or rejected, as
CFR 200.30–3(a)(12). applicable, and any ISO that does not include a TIF
1 15 U.S.C. 78s(b)(1). instruction of IOC or FOK will be converted into a
2 17 CFR 240.19b–4. 5 See Exchange Rule 1.5(ee). non-ISO and be queued for participation in the Re-
3 15 U.S.C. 78s(b)(3)(A). 6 Orders Opening Process. See Exchange Rule 11.7(e)(1).
cancelled prior to the Opening Process
4 17 CFR 240.19b–4(f)(6)(iii). will not participate in the Opening Process. 10 See Exchange Rule 1.5(cc).
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Document Created: 2016-06-16 00:37:29
Document Modified: 2016-06-16 00:37:29
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 81 FR 39299 |
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