81 FR 4074 - Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Make Nonsubstantive, Clarifying Amendments to Several Rules Relating to the Clearing of Exchange Options Transactions
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 15 (January 25, 2016)
Federal Register Volume 81, Issue 15 (January 25, 2016)
| Page Range | 4074-4076 | |
| FR Document | 2016-01307 |
[Federal Register Volume 81, Number 15 (Monday, January 25, 2016)] [Notices] [Pages 4074-4076] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-01307] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-76929; File No. SR-Phlx-2016-03] Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Make Nonsubstantive, Clarifying Amendments to Several Rules Relating to the Clearing of Exchange Options Transactions January 19, 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 January 5, 2016, NASDAQ OMX PHLX LLC (``Phlx'' or ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``Commission'') the proposed rule change as described in Items I, II, and III, below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of the Substance of the Proposed Rule Change The Exchange proposes to make nonsubstantive, clarifying amendments to several rules relating to clearing of Exchange options transactions. 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 [[Page 4075]] 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 make minor nonsubstantive amendments to four rules relating to options clearing responsibilities of members. The changes are intended to correct minor drafting errors, and to update and improve readability of the rules. The Exchange is also proposing to extend applicability of a rule concerning violations of The Options Clearing Corporation (``OCC'') rules to off-floor transactions as well as to on-floor transactions. Phlx Rule 1046, Clearing Arrangements, currently provides that a member or member organization conducting an options business must either be: (i) A clearing member of OCC; or (ii) have a clearing arrangement with an Exchange member organization that is a clearing member of OCC. The Exchange is revising the rule to simply state that a member or member organization conducting an options business must be a Clearing Member or have a clearing arrangement with a Clearing Member. The revision simply makes use of the existing defined term ``Clearing Member'' \3\ to improve readability. No change in meaning is intended. --------------------------------------------------------------------------- \3\ Exchange Rule 1000(b)(3) defines ``Clearing Member'' as ``a member organization which has been admitted to membership in the Options Clearing Corporation pursuant to the provisions of the rules of the Options Clearing Corporation.'' --------------------------------------------------------------------------- Phlx Rule 1050, Violation Of By-Laws And Rules Of Options Clearing Corporation, currently provides for Exchange penalties in the event a member, member organization or director of a member organization that is a corporation ``shall be adjudged guilty in a proceeding under Article XVIII of the by-laws of a violation of any provision of the rules of the Options Clearing Corporation with respect to the reporting, clearance or settlement of any transaction on the options trading floor of this Corporation. . . . '' The Exchange is deleting the reference to a proceeding under Article XVIII of the by-laws, which the Exchange deleted in 2011,\4\ and is replacing it with a more general and accurate reference to ``an Exchange disciplinary proceeding.'' The Exchange is also replacing the reference to ``any transaction on the options trading floor of this Corporation'' with a reference to ``any Exchange options transaction'' in view of today's electronic options trading which is not limited to the trading floor and the fact that the Exchange is not otherwise referred to in the rulebook as ``this Corporation.'' The Exchange did not amend Rule 1050 when it introduced off-floor trading, but is doing so now because whether a transaction takes place on-floor or off-floor has no bearing on the significance of any violation of the OCC rules. The Exchange has determined that there is no reason for off-floor transactions to be excluded from a requirement that transactions must be conducted in accordance with OCC rules. The new rule should ensure that off-floor transactions as well as on-floor transactions are conducted in a manner consistent with OCC rules. --------------------------------------------------------------------------- \4\ See Securities Exchange Act Release No. 63981 (February 25, 2011), 76 FR 12180 (March 4, 2011) (SR-Phlx-2011-13) (a rule proposal to, among other things, amend the Limited Liability Company Agreement and By-Laws to substantially conform to The NASDAQ Stock Market's Second Amended Limited Liability Company Agreement and By- Laws). --------------------------------------------------------------------------- Phlx Rule 1052, Responsibility Of Clearing Options Members For Exchange Options Transactions, currently provides for the clearing of transactions of non-Clearing Members by a ``member organization which is a clearing member of the Options Clearing Corporation. . . .'' The Exchange again is replacing this quoted language with the more succinct defined term ``Clearing Member.'' \5\ The word ``Options'' is deleted from the rule's title as superfluous. --------------------------------------------------------------------------- \5\ Rule 1052 currently provides that every member organization which is a clearing member of the Options Clearing Corporation shall be responsible for the clearance of the Exchange options transactions of such member organization and of each member or member organization who gives up the name of such clearing member in an Exchange options transaction, provided the clearing member has authorized such member or member organization to give up its name with respect to Exchange options transactions. --------------------------------------------------------------------------- Finally, Rule 1054, Verification Of Trades And Reconciliation Of Uncompared Trades, imposes certain trade verification and reconciliation obligations on any ``member organization which is a clearing member of the Options Clearing Corporation.'' Once again the Exchange is replacing the cumbersome language in quotation marks with the succinct, defined term ``Clearing Member.'' The change is made simply to improve readability. 2. Statutory Basis The Exchange believes that its proposal is consistent with section 6(b) of the Act \6\ in general, and furthers the objectives of section 6(b)(5) of the Act \7\ in particular, in that it is designed to promote just and equitable principles of trade, 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, by improving the accuracy and readability of the amended rules. --------------------------------------------------------------------------- \6\ 15 U.S.C. 78f(b). \7\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- With respect to Rules 1046, 1052 and 1054, employing the defined term ``Clearing Member'' rather than ``a clearing member of the Options Clearing Corporation'' shortens the rule and makes it more readable. With respect to Rule 1050, deletion of a reference to a nonexistent provision of the Exchange's bylaws and replacing it with a general reference to the Exchange's disciplinary proceedings should make the rule more understandable. Additionally with respect to Rule 1050, extending the applicability of the rule to off-floor transactions as well as to on-floor transactions should incentivize those who engage in off-floor transactions to comply with OCC rules, which is in the public interest. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the clarifying amendments proposed herein will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act inasmuch as they simply improve the accuracy and readability of the rules. Additionally, Rule 1050, as amended, will apply to members transacting off the trading floor as well as those transacting on the trading floor, which should reduce a burden on competition on members who transact primarily on the trading floor and also on members of other markets whose rules require compliance with OCC rules in connection with transactions not occurring on a trading floor. 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. [[Page 4076]] 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 \8\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\9\ --------------------------------------------------------------------------- \8\ 15 U.S.C. 78s(b)(3)(A)(iii). \9\ 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 Number SR-Phlx-2016-03 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-2016-03. 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 such 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-2016-03, and should be submitted on or before February 16, 2016. --------------------------------------------------------------------------- \10\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\10\ Robert W. Errett, Deputy Secretary. [FR Doc. 2016-01307 Filed 1-22-16; 8:45 am] BILLING CODE 8011-01-P
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TABLE 1—REVISED PRA BURDEN UNDER THE AMENDMENT PERMITTING EMERGING GROWTH COMPANIES TO OMIT
FINANCIAL INFORMATION FOR CERTAIN HISTORICAL PERIODS—Continued
Incremental Total
Number of 25% 75% Professional
burden incremental
responses company professional costs
hours 6/form burden hours
(A) (B) (C) = (A) * (B) (D) = (C) * E = (C) * 0.75 (F) = (E) *
0.25 $400
Total ......................................................... ........................ ........................ (68,355) (17,089) ........................ $(20,506,400)
2. Forward Incorporation by Reference the registration statement would reduce reduce the paperwork burden in Form
on Form S–1 by Smaller Reporting incrementally the annual paperwork S–1 for smaller reporting companies by
Companies burden by approximately 53,125 hours 212,500 hours on the assumption that
For purposes of the PRA, we estimate of issuer personnel time and by a cost the burden to complete a Form S–1 that
that all smaller reporting companies of approximately $63,750,000 for the incorporates by reference would be the
will take advantage of the election to services of outside professionals. The same as the burden currently imposed
forward incorporate by reference. We estimate reflects the decrease in by Form S–3 (472 hours). Therefore, the
estimate that the amendments to permit disclosure preparation time by amount of time eliminated for each
smaller reporting companies to eliminating the need to file certain post- Form S–1 that incorporates by reference
incorporate by reference into the effective amendments when that would be 500 hours (972 hours for a
prospectus contained in the registration information is disclosed in Exchange Form S–1 that does not incorporate
statement on Form S–1 all documents Act filings after the effectiveness of the information by reference minus 472
subsequently filed by the issuer with the Form S–1. We estimate that forward hours for a Form S–1 that does
Commission after the effective date of incorporation by reference would incorporate information by reference).
TABLE 2—REVISED PRA BURDEN UNDER THE AMENDMENT PERMITTING SMALLER REPORTING COMPANIES TO FORWARD
INCORPORATE BY REFERENCE ON FORM S–1
Total
Incremental
Number of incremental 25% 75% Professional
burden hours/
responses 7 burden company professional costs
Form hours
(A) (B) (C) = (A) * (B) (D) = (C)* 0.25 E = (C) * 0.75 (F) = (E) *
$400
Form S–1 ................................................. 425 (500) (212,500) (53,125) (159,375) $(63,750,000)
Title of Collection: Simplification of SECURITIES AND EXCHANGE prepared by the Exchange. The
Disclosure Requirements for Emerging COMMISSION Commission is publishing this notice to
Growth Companies and Forward solicit comments on the proposed rule
[Release No. 34–76929; File No. SR–Phlx–
Incorporation by Reference on Form S– change from interested persons.
2016–03]
1 for Smaller Reporting Companies. I. Self-Regulatory Organization’s
OMB Control Numbers: 3235–0065 Self-Regulatory Organizations; Statement of the Terms of the Substance
(Form S–1) and 3235–0258 (Form F–1). NASDAQ OMX PHLX LLC; Notice of of the Proposed Rule Change
Filing and Immediate Effectiveness of
Type of Review: Emergency. Proposed Rule Change To Make The Exchange proposes to make
Requested Duration of Authorization: Nonsubstantive, Clarifying nonsubstantive, clarifying amendments
6 Months. Amendments to Several Rules Relating to several rules relating to clearing of
to the Clearing of Exchange Options Exchange options transactions.
Dated: January 19, 2016. The text of the proposed rule change
Transactions
Robert W. Errett, is available on the Exchange’s Web site
Deputy Secretary. January 19, 2016. at http://
[FR Doc. 2016–01304 Filed 1–22–16; 8:45 am] Pursuant to section 19(b)(1) of the nasdaqomxphlx.cchwallstreet.com/, at
BILLING CODE 8011–01–P Securities Exchange Act of 1934 the principal office of the Exchange, and
(‘‘Act’’),1 and Rule 19b–4 thereunder,2 at the Commission’s Public Reference
notice is hereby given that on January 5, Room.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
2016, NASDAQ OMX PHLX LLC II. Self-Regulatory Organization’s
(‘‘Phlx’’ or ‘‘Exchange’’) filed with the Statement of the Purpose of, and
Securities and Exchange Commission Statutory Basis for, the Proposed Rule
7 The number of responses equals the average
(‘‘SEC’’ or ‘‘Commission’’) the proposed Change
number of Forms S–1 filed by smaller reporting rule change as described in Items I, II,
companies (SRCs) during a three-year period. In and III, below, which Items have been In its filing with the Commission, the
2012, SRCs filed 394 Forms S–1; in 2013, SRCs filed Exchange included statements
432 Forms S–1; and in 2014, SRCs filed 448 Forms 1 15 U.S.C. 78s(b)(1). concerning the purpose of and basis for
S–1. 2 17 CFR 240.19b–4. the proposed rule change and discussed
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![4076 Federal Register / Vol. 81, No. 15 / Monday, January 25, 2016 / Notices
III. Date of Effectiveness of the rules/sro.shtml). Copies of the constituting a ‘‘non-controversial’’ rule
Proposed Rule Change and Timing for submission, all subsequent change under paragraph (f)(6) of Rule
Commission Action amendments, all written statements 19b–4 under the Act,3 which renders
Because the foregoing proposed rule with respect to the proposed rule the proposal effective upon receipt of
change does not: (i) Significantly affect change that are filed with the this filing by the Commission. The
the protection of investors or the public Commission, and all written Commission is publishing this notice to
interest; (ii) impose any significant communications relating to the solicit comments on the proposed rule
burden on competition; and (iii) become proposed rule change between the change from interested persons.
operative for 30 days from the date on Commission and any person, other than
those that may be withheld from the I. Self-Regulatory Organization’s
which it was filed, or such shorter time Statement of the Terms of the Substance
as the Commission may designate, it has public in accordance with the
provisions of 5 U.S.C. 552, will be of the Proposed Rule Change
become effective pursuant to section
available for Web site viewing and FINRA is proposing to (i) delete from
19(b)(3)(A)(iii) of the Act 8 and
printing in the Commission’s Public the FINRA rulebook Rule 4552, which
subparagraph (f)(6) of Rule 19b–4
Reference Room, 100 F Street NE., requires each alternative trading system
thereunder.9
At any time within 60 days of the Washington, DC 20549 on official (‘‘ATS’’) that has filed a Form ATS with
filing of the proposed rule change, the business days between the hours of the SEC to report to FINRA weekly
Commission summarily may 10:00 a.m. and 3:00 p.m. Copies of such volume information and number of
temporarily suspend such rule change if filing also will be available for trades regarding equity securities
it appears to the Commission that such inspection and copying at the principal transactions within the ATS; (ii) amend
action is: (i) Necessary or appropriate in office of the Exchange. All comments Rules 6110 and 6610 to add provisions
received will be posted without change; regarding FINRA’s publication of ATS
the public interest; (ii) for the protection
the Commission does not edit personal volume and trade count information for
of investors; or (iii) otherwise in
identifying information from equity securities, including information
furtherance of the purposes of the Act.
submissions. You should submit only similar to what is currently reported by
If the Commission takes such action, the
information that you wish to make ATSs pursuant to Rule 4552 as well as
Commission shall institute proceedings
available publicly. All submissions information regarding ATS block
to determine whether the proposed rule
should refer to File Number SR–Phlx– transactions; and (iii) amend Rules 6183
should be approved or disapproved.
2016–03, and should be submitted on or and 6625 to require ATSs seeking an
IV. Solicitation of Comments before February 16, 2016. exemption from FINRA trade reporting
Interested persons are invited to For the Commission, by the Division of rules to provide FINRA with a link to
submit written data, views, and Trading and Markets, pursuant to delegated a publicly-available Web site that
arguments concerning the foregoing, authority.10 displays their weekly equity volume
including whether the proposed rule Robert W. Errett, information in a format substantially
change is consistent with the Act. Deputy Secretary. similar to that used by FINRA.
Comments may be submitted by any of [FR Doc. 2016–01307 Filed 1–22–16; 8:45 am] The text of the proposed rule change
the following methods: BILLING CODE 8011–01–P
is available on FINRA’s Web site at
http://www.finra.org, at the principal
Electronic Comments office of FINRA and at the
• Use the Commission’s Internet SECURITIES AND EXCHANGE Commission’s Public Reference Room.
comment form (http://www.sec.gov/ COMMISSION II. Self-Regulatory Organization’s
rules/sro.shtml); or Statement of the Purpose of, and
[Release No. 34–76931; File No. SR–FINRA–
• Send an email to rule-comments@ 2016–002] Statutory Basis for, the Proposed Rule
sec.gov. Please include File Number SR– Change
Phlx–2016–03 on the subject line. Self-Regulatory Organizations;
Financial Industry Regulatory In its filing with the Commission,
Paper Comments FINRA included statements concerning
Authority, Inc.; Notice of Filing and
• Send paper comments in triplicate Immediate Effectiveness of a Proposed the purpose of and basis for the
to Secretary, Securities and Exchange Rule Change Relating to Alternative proposed rule change and discussed any
Commission, 100 F Street NE., Trading System Volume and Trading comments it received on the proposed
Washington, DC 20549–1090. Information rule change. The text of these statements
All submissions should refer to File may be examined at the places specified
Number SR–Phlx–2016–03. This file January 19, 2016. in Item IV below. FINRA has prepared
number should be included on the Pursuant to Section 19(b)(1) of the summaries, set forth in sections A, B,
subject line if email is used. To help the Securities Exchange Act of 1934 and C below, of the most significant
Commission process and review your (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 aspects of such statements.
comments more efficiently, please use notice is hereby given that on January 8,
A. Self-Regulatory Organization’s
only one method. The Commission will 2016, Financial Industry Regulatory
Statement of the Purpose of, and
post all comments on the Commission’s Authority, Inc. (‘‘FINRA’’) filed with the
Securities and Exchange Commission Statutory Basis for, the Proposed Rule
Internet Web site (http://www.sec.gov/ Change
asabaliauskas on DSK5VPTVN1PROD with NOTICES
(‘‘SEC’’ or ‘‘Commission’’) the proposed
8 15 U.S.C. 78s(b)(3)(A)(iii). rule change as described in Items I, II, 1. Purpose
9 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– and III below, which Items have been
(i) Background
4(f)(6) requires a self-regulatory organization to give prepared by FINRA. FINRA has
the Commission written notice of its intent to file designated the proposed rule change as On January 17, 2014, the SEC
the proposed rule change at least five business days approved a proposed rule change to (i)
prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
10 17 CFR 200.30–3(a)(12). adopt Rule 4552 (Alternative Trading
1 15 U.S.C. 78s(b)(1).
Commission. The Exchange has satisfied this
requirement. 2 17 CFR 240.19b–4. 3 17 CFR 240.19b–4(f)(6).
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Document Created: 2018-02-02 12:35:24
Document Modified: 2018-02-02 12:35:24
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| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| FR Citation | 81 FR 4074 |
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