81_FR_43447 81 FR 43320 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Commentary .02 to NYSE Amex Options Rule 960NY in Order To Extend the Penny Pilot Through December 31, 2016

81 FR 43320 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Commentary .02 to NYSE Amex Options Rule 960NY in Order To Extend the Penny Pilot Through December 31, 2016

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 127 (July 1, 2016)

Page Range43320-43322
FR Document2016-15715

Federal Register, Volume 81 Issue 127 (Friday, July 1, 2016)
[Federal Register Volume 81, Number 127 (Friday, July 1, 2016)]
[Notices]
[Pages 43320-43322]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-15715]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-78176; File No. SR-NYSEMKT-2016-61]


Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and 
Immediate Effectiveness of Proposed Rule Change Amending Commentary .02 
to NYSE Amex Options Rule 960NY in Order To Extend the Penny Pilot 
Through December 31, 2016

June 28, 2016.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that on June 17, 2016, NYSE MKT LLC (the ``Exchange'' or ``NYSE 
MKT'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the self-regulatory 
organization. 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Commentary .02 to NYSE Amex Options 
Rule 960NY in order to extend the Penny Pilot in options classes in 
certain issues (``Pilot Program'') previously approved by the 
Securities and Exchange Commission (``Commission'') through December 
31, 2016. The Pilot Program is currently scheduled to expire on June 
30, 2016. The proposed rule change is available on the Exchange's Web 
site at www.nyse.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 self-regulatory organization 
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 those 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 hereby proposes to amend Commentary .02 to Exchange 
Rule 960NY to extend the time period of the Pilot Program,\4\ which is 
currently scheduled to expire on June 30, 2016, through December 31, 
2016. The Exchange also proposes that the dates to replace issues in 
the Pilot Program that have been delisted be revised to the second 
trading day following July 1, 2016.\5\
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 75281 (June 24, 
2015), 80 FR 37338 (June 30, 2015) (SR-NYSEMKT-2015-43).
    \5\ The month immediately preceding a replacement class's 
addition to the Pilot Program (i.e., June) would not be used for 
purposes of the analysis for determining the replacement class. 
Thus, a replacement class to be added on the second trading day 
following July 1, 2016 would be identified based on The Option 
Clearing Corporation's trading volume data from December 1, 2015 
through May 31, 2016. The Exchange will announce the replacement 
issues to the Exchange's membership through a Trader Update.
---------------------------------------------------------------------------

    This filing does not propose any substantive changes to the Pilot 
Program: All classes currently participating 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 increase in quote traffic.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) \6\ of the 
Securities Exchange Act of 1934 (the ``Act''), in general, and furthers 
the objectives of Section 6(b)(5),\7\ in

[[Page 43321]]

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 mechanisms of a free and open 
market and a national market system.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    In particular, the proposed rule change, which extends the Penny 
Pilot Program for six months, allows the Exchange to continue to 
participate in a program that has been viewed as beneficial to traders, 
investors and public customers and viewed as successful by the other 
options exchanges participating in it. Accordingly, the Exchange 
believes that the proposal is consistent with the Act because it will 
allow the Exchange to extend the Pilot Program prior to its expiration 
on June 30, 2016. The Exchange notes that this proposal does not 
propose any new policies or provisions that are unique or unproven, but 
instead relates to the continuation of an existing program that 
operates on a pilot basis.
    The Exchange believes that the Pilot Program promotes just and 
equitable principles of trade by enabling public customers and other 
market participants to express their true prices to buy and sell 
options to the benefit of all market participants.
    The proposal to extend the Pilot Program is designed 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 mechanisms of 
a free and open market and a national market system, by allowing the 
Exchange and the Commission additional time to analyze the impact of 
the Pilot Program while also allowing the Exchange to continue to 
compete for order flow with other exchanges in option issues trading as 
part of the Pilot Program.

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 that is not necessary or appropriate 
in furtherance of the purposes of the Act. Specifically, the Exchange 
believes that, by extending the expiration of the Pilot Program, the 
proposed rule change will allow for further analysis of the Pilot 
Program and a determination of how the Program should be structured in 
the future. In doing so, the proposed rule change will also serve to 
promote regulatory clarity and consistency, thereby reducing burdens on 
the marketplace and facilitating investor protection. The Pilot Program 
is an industry-wide initiative supported by all other option exchanges. 
The Exchange believes that extending the Pilot Program will allow for 
continued competition between NYSE Amex Options market participants 
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 Program.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \8\ and Rule 19b-4(f)(6) thereunder.\9\ 
Because the proposed rule change does not: (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative 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.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \9\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \10\ normally 
does not become operative prior to 30 days after the date of the 
filing.\11\ However, pursuant to Rule 19b-4(f)(6)(iii),\12\ 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.\13\ Accordingly, the Commission designates 
the proposed rule change as operative upon filing with the 
Commission.\14\
---------------------------------------------------------------------------

    \10\ 17 CFR 240.19b-4(f)(6).
    \11\ 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.
    \12\ 17 CFR 240.19b-4(f)(6)(iii).
    \13\ See Securities Exchange Act Release No. 61061 (November 24, 
2009), 74 FR 62857 (December 1, 2009) (SR-NYSEArca-2009-44). See 
also supra note 4.
    \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 Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEMKT-2016-61 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-NYSEMKT-2016-61. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your

[[Page 43322]]

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 Section, 100 F Street NE., Washington, DC 20549-1090 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 NYSE's principal office. 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-NYSEMKT-2016-61 and should be submitted on or before 
July 22, 2016.
---------------------------------------------------------------------------

    \16\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-15715 Filed 6-30-16; 8:45 am]
 BILLING CODE 8011-01-P



                                                    43320                             Federal Register / Vol. 81, No. 127 / Friday, July 1, 2016 / Notices

                                                    of the proposed rule change, or such                    received will be posted without change;                and at the Commission’s Public
                                                    shorter time as designated by the                       the Commission does not edit personal                  Reference Room.
                                                    Commission.                                             identifying information from
                                                       At any time within 60 days of the                                                                           II. Self-Regulatory Organization’s
                                                                                                            submissions. You should submit only
                                                    filing of the proposed rule change, the                                                                        Statement of the Purpose of, and
                                                                                                            information that you wish to make
                                                    Commission summarily may                                                                                       Statutory Basis for, the Proposed Rule
                                                                                                            available publicly. All submissions
                                                    temporarily suspend such rule change if                                                                        Change
                                                                                                            should refer to File Number SR-
                                                    it appears to the Commission that such                  BatsEDGX–2016–25 and should be                            In its filing with the Commission, the
                                                    action is: (1) Necessary or appropriate in              submitted on or before July 22, 2016.                  self-regulatory organization included
                                                    the public interest; (2) for the protection                                                                    statements concerning the purpose of,
                                                                                                              For the Commission, by the Division of
                                                    of investors; or (3) otherwise in                       Trading and Markets, pursuant to delegated             and basis for, the proposed rule change
                                                    furtherance of the purposes of the Act.                 authority.20                                           and discussed any comments it received
                                                    If the Commission takes such action, the                Robert W. Errett,                                      on the proposed rule change. The text
                                                    Commission shall institute proceedings                                                                         of those statements may be examined at
                                                                                                            Deputy Secretary.
                                                    to determine whether the proposed rule                                                                         the places specified in Item IV below.
                                                                                                            [FR Doc. 2016–15581 Filed 6–30–16; 8:45 am]
                                                    should be approved or disapproved.                                                                             The Exchange has prepared summaries,
                                                                                                            BILLING CODE 8011–01–P
                                                    IV. Solicitation of Comments                                                                                   set forth in sections A, B, and C below,
                                                                                                                                                                   of the most significant parts of such
                                                      Interested persons are invited to                                                                            statements.
                                                    submit written data, views, and                         SECURITIES AND EXCHANGE
                                                    arguments concerning the foregoing,                     COMMISSION                                             A. Self-Regulatory Organization’s
                                                    including whether the proposed rule                                                                            Statement of the Purpose of, and the
                                                                                                            [Release No. 34–78176; File No. SR–                    Statutory Basis for, the Proposed Rule
                                                    change is consistent with the Act.                      NYSEMKT–2016–61]
                                                    Comments may be submitted by any of                                                                            Change
                                                    the following methods:                                  Self-Regulatory Organizations; NYSE                    1. Purpose
                                                    Electronic Comments                                     MKT LLC; Notice of Filing and                             The Exchange hereby proposes to
                                                                                                            Immediate Effectiveness of Proposed
                                                      • Use the Commission’s Internet                       Rule Change Amending Commentary
                                                                                                                                                                   amend Commentary .02 to Exchange
                                                    comment form (http://www.sec.gov/                                                                              Rule 960NY to extend the time period
                                                                                                            .02 to NYSE Amex Options Rule 960NY                    of the Pilot Program,4 which is currently
                                                    rules/sro.shtml); or                                    in Order To Extend the Penny Pilot
                                                      • Send an email to rule-comments@                                                                            scheduled to expire on June 30, 2016,
                                                                                                            Through December 31, 2016                              through December 31, 2016. The
                                                    sec.gov. Please include File Number SR-
                                                    BatsEDGX–2016–25 on the subject line.                   June 28, 2016.                                         Exchange also proposes that the dates to
                                                                                                               Pursuant to Section 19(b)(1) 1 of the               replace issues in the Pilot Program that
                                                    Paper Comments                                                                                                 have been delisted be revised to the
                                                                                                            Securities Exchange Act of 1934 (the
                                                       • Send paper comments in triplicate                  ‘‘Act’’) 2 and Rule 19b–4 thereunder,3                 second trading day following July 1,
                                                    to Secretary, Securities and Exchange                   notice is hereby given that on June 17,                2016.5
                                                    Commission, 100 F Street, NE.,                          2016, NYSE MKT LLC (the ‘‘Exchange’’                      This filing does not propose any
                                                    Washington, DC 20549–1090.                              or ‘‘NYSE MKT’’) filed with the                        substantive changes to the Pilot
                                                    All submissions should refer to File                    Securities and Exchange Commission                     Program: All classes currently
                                                    Number SR-BatsEDGX–2016–25. This                        (the ‘‘Commission’’) the proposed rule                 participating will remain the same and
                                                    file number should be included on the                   change as described in Items I and II                  all minimum increments will remain
                                                    subject line if email is used. To help the              below, which Items have been prepared                  unchanged. The Exchange believes the
                                                    Commission process and review your                      by the self-regulatory organization. The               benefits to public customers and other
                                                    comments more efficiently, please use                   Commission is publishing this notice to                market participants who will be able to
                                                    only one method. The Commission will                    solicit comments on the proposed rule                  express their true prices to buy and sell
                                                    post all comments on the Commission’s                   change from interested persons.                        options have been demonstrated to
                                                    Internet Web site (http://www.sec.gov/                                                                         outweigh the increase in quote traffic.
                                                    rules/sro.shtml). Copies of the                         I. Self-Regulatory Organization’s
                                                                                                            Statement of the Terms of Substance of                 2. Statutory Basis
                                                    submission, all subsequent
                                                    amendments, all written statements                      the Proposed Rule Change                                  The proposed rule change is
                                                    with respect to the proposed rule                                                                              consistent with Section 6(b) 6 of the
                                                                                                               The Exchange proposes to amend
                                                    change that are filed with the                          Commentary .02 to NYSE Amex Options                    Securities Exchange Act of 1934 (the
                                                    Commission, and all written                             Rule 960NY in order to extend the                      ‘‘Act’’), in general, and furthers the
                                                    communications relating to the                          Penny Pilot in options classes in certain              objectives of Section 6(b)(5),7 in
                                                    proposed rule change between the                        issues (‘‘Pilot Program’’) previously                     4 See Securities Exchange Act Release No. 75281
                                                    Commission and any person, other than                   approved by the Securities and                         (June 24, 2015), 80 FR 37338 (June 30, 2015) (SR–
                                                    those that may be withheld from the                     Exchange Commission (‘‘Commission’’)                   NYSEMKT–2015–43).
                                                    public in accordance with the                           through December 31, 2016. The Pilot                      5 The month immediately preceding a

                                                    provisions of 5 U.S.C. 552, will be                     Program is currently scheduled to                      replacement class’s addition to the Pilot Program
                                                    available for Web site viewing and                                                                             (i.e., June) would not be used for purposes of the
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                                                                            expire on June 30, 2016. The proposed                  analysis for determining the replacement class.
                                                    printing in the Commission’s Public                     rule change is available on the                        Thus, a replacement class to be added on the
                                                    Reference Room, 100 F Street, NE.,                      Exchange’s Web site at www.nyse.com,                   second trading day following July 1, 2016 would be
                                                    Washington, DC 20549, on official                       at the principal office of the Exchange,               identified based on The Option Clearing
                                                    business days between the hours of                                                                             Corporation’s trading volume data from December
                                                                                                                                                                   1, 2015 through May 31, 2016. The Exchange will
                                                    10:00 a.m. and 3:00 p.m. Copies of such                   20 17 CFR 200.30–3(a)(12).                           announce the replacement issues to the Exchange’s
                                                    filing will also be available for                         1 15 U.S.C. 78s(b)(1).                               membership through a Trader Update.
                                                    inspection and copying at the principal                   2 15 U.S.C. 78a.                                        6 15 U.S.C. 78f(b).

                                                    office of the Exchange. All comments                      3 17 CFR 240.19b–4.                                     7 15 U.S.C. 78f(b)(5).




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                                                                                      Federal Register / Vol. 81, No. 127 / Friday, July 1, 2016 / Notices                                                    43321

                                                    particular, in that it is designed to                   and consistency, thereby reducing                       filing. The Commission believes that
                                                    prevent fraudulent and manipulative                     burdens on the marketplace and                          waiving the 30-day operative delay is
                                                    acts and practices, to promote just and                 facilitating investor protection. The                   consistent with the protection of
                                                    equitable principles of trade, to foster                Pilot Program is an industry-wide                       investors and the public interest
                                                    cooperation and coordination with                       initiative supported by all other option                because doing so will allow the Pilot
                                                    persons engaged in facilitating                         exchanges. The Exchange believes that                   Program to continue without
                                                    transactions in securities, and to remove               extending the Pilot Program will allow                  interruption in a manner that is
                                                    impediments to and perfect the                          for continued competition between                       consistent with the Commission’s prior
                                                    mechanisms of a free and open market                    NYSE Amex Options market                                approval of the extension and expansion
                                                    and a national market system.                           participants trading similar products as                of the Pilot Program and will allow the
                                                       In particular, the proposed rule                     their counterparts on other exchanges,                  Exchange and the Commission
                                                    change, which extends the Penny Pilot                   while at the same time allowing the                     additional time to analyze the impact of
                                                    Program for six months, allows the                      Exchange to continue to compete for                     the Pilot Program.13 Accordingly, the
                                                    Exchange to continue to participate in a                order flow with other exchanges in                      Commission designates the proposed
                                                    program that has been viewed as                         option issues trading as part of the Pilot              rule change as operative upon filing
                                                    beneficial to traders, investors and                    Program.                                                with the Commission.14
                                                    public customers and viewed as                                                                                     At any time within 60 days of the
                                                    successful by the other options                         C. Self-Regulatory Organization’s
                                                                                                            Statement on Comments on the                            filing of such proposed rule change, the
                                                    exchanges participating in it.                                                                                  Commission summarily may
                                                    Accordingly, the Exchange believes that                 Proposed Rule Change Received From
                                                                                                            Members, Participants, or Others                        temporarily suspend such rule change if
                                                    the proposal is consistent with the Act                                                                         it appears to the Commission that such
                                                    because it will allow the Exchange to                     No written comments were solicited                    action is necessary or appropriate in the
                                                    extend the Pilot Program prior to its                   or received with respect to the proposed                public interest, for the protection of
                                                    expiration on June 30, 2016. The                        rule change.                                            investors, or otherwise in furtherance of
                                                    Exchange notes that this proposal does                  III. Date of Effectiveness of the                       the purposes of the Act. If the
                                                    not propose any new policies or                         Proposed Rule Change and Timing for                     Commission takes such action, the
                                                    provisions that are unique or unproven,                 Commission Action                                       Commission shall institute proceedings
                                                    but instead relates to the continuation of                                                                      under Section 19(b)(2)(B) 15 of the Act to
                                                    an existing program that operates on a                     The Exchange has filed the proposed
                                                                                                            rule change pursuant to Section                         determine whether the proposed rule
                                                    pilot basis.                                                                                                    change should be approved or
                                                       The Exchange believes that the Pilot                 19(b)(3)(A)(iii) of the Act 8 and Rule
                                                                                                            19b–4(f)(6) thereunder.9 Because the                    disapproved.
                                                    Program promotes just and equitable
                                                    principles of trade by enabling public                  proposed rule change does not: (i)                      IV. Solicitation of Comments
                                                    customers and other market participants                 Significantly affect the protection of
                                                                                                            investors or the public interest; (ii)                    Interested persons are invited to
                                                    to express their true prices to buy and                                                                         submit written data, views, and
                                                    sell options to the benefit of all market               impose any significant burden on
                                                                                                            competition; and (iii) become operative                 arguments concerning the foregoing,
                                                    participants.                                                                                                   including whether the proposed rule
                                                       The proposal to extend the Pilot                     prior to 30 days from the date on which
                                                                                                            it was filed, or such shorter time as the               change is consistent with the Act.
                                                    Program is designed to promote just and
                                                                                                            Commission may designate if consistent                  Comments may be submitted by any of
                                                    equitable principles of trade, to foster
                                                                                                            with the protection of investors and the                the following methods:
                                                    cooperation and coordination with
                                                    persons engaged in facilitating                         public interest, the proposed rule                      Electronic Comments
                                                    transactions in securities, and to remove               change has become effective pursuant to
                                                                                                                                                                      • Use the Commission’s Internet
                                                    impediments to and perfect the                          Section 19(b)(3)(A) of the Act and Rule
                                                                                                                                                                    comment form (http://www.sec.gov/
                                                    mechanisms of a free and open market                    19b–4(f)(6)(iii) thereunder.
                                                                                                               A proposed rule change filed under                   rules/sro.shtml); or
                                                    and a national market system, by                                                                                  • Send an email to rule-comments@
                                                    allowing the Exchange and the                           Rule 19b–4(f)(6) 10 normally does not
                                                                                                            become operative prior to 30 days after                 sec.gov. Please include File Number SR–
                                                    Commission additional time to analyze                                                                           NYSEMKT–2016–61 on the subject line.
                                                    the impact of the Pilot Program while                   the date of the filing.11 However,
                                                    also allowing the Exchange to continue                  pursuant to Rule 19b–4(f)(6)(iii),12 the                Paper Comments
                                                    to compete for order flow with other                    Commission may designate a shorter
                                                                                                                                                                       • Send paper comments in triplicate
                                                    exchanges in option issues trading as                   time if such action is consistent with the
                                                                                                                                                                    to Secretary, Securities and Exchange
                                                    part of the Pilot Program.                              protection of investors and the public
                                                                                                                                                                    Commission, 100 F Street NE.,
                                                                                                            interest. The Exchange has asked the
                                                    B. Self-Regulatory Organization’s                                                                               Washington, DC 20549–1090.
                                                                                                            Commission to waive the 30-day
                                                    Statement on Burden on Competition                      operative delay so that the proposal may                All submissions should refer to File
                                                      The Exchange does not believe that                    become operative immediately upon                       Number SR–NYSEMKT–2016–61. This
                                                    the proposed rule change will impose                                                                            file number should be included on the
                                                    any burden on competition that is not                     8 15  U.S.C. 78s(b)(3)(A)(iii).                       subject line if email is used. To help the
                                                    necessary or appropriate in furtherance                   9 17  CFR 240.19b–4(f)(6).                            Commission process and review your
                                                                                                              10 17 CFR 240.19b–4(f)(6).
                                                    of the purposes of the Act. Specifically,
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                                                                              11 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–        13 See Securities Exchange Act Release No. 61061
                                                    the Exchange believes that, by extending                                                                        (November 24, 2009), 74 FR 62857 (December 1,
                                                                                                            4(f)(6)(iii) requires the Exchange to give the
                                                    the expiration of the Pilot Program, the                Commission written notice of the Exchange’s intent      2009) (SR–NYSEArca–2009–44). See also supra
                                                    proposed rule change will allow for                     to file the proposed rule change along with a brief     note 4.
                                                    further analysis of the Pilot Program and               description and the text of the proposed rule              14 For purposes only of waiving the operative

                                                    a determination of how the Program                      change, at least five business days prior to the date   delay for this proposal, the Commission has
                                                                                                            of filing of the proposed rule change, or such          considered the proposed rule’s impact on
                                                    should be structured in the future. In                  shorter time as designated by the Commission. The       efficiency, competition, and capital formation. See
                                                    doing so, the proposed rule change will                 Exchange has satisfied this pre-filing requirement.     15 U.S.C. 78c(f).
                                                    also serve to promote regulatory clarity                  12 17 CFR 240.19b–4(f)(6)(iii).                          15 15 U.S.C. 78s(b)(2)(B).




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                                                    43322                             Federal Register / Vol. 81, No. 127 / Friday, July 1, 2016 / Notices

                                                    comments more efficiently, please use                   change as described in Items I and II                  Current PIP Allocation
                                                    only one method. The Commission will                    below, which Items have been prepared                    At the conclusion of a PIP, the PIP
                                                    post all comments on the Commission’s                   by the self-regulatory organization. The               Order is currently matched against the
                                                    Internet Web site (http://www.sec.gov/                  Commission is publishing this notice to                best prevailing quote(s) or order(s) on
                                                    rules/sro.shtml). Copies of the                         solicit comments on the proposed rule                  BOX (except any pre-PIP Broadcast
                                                    submission, all subsequent                              change from interested persons.                        proprietary quote or order from the
                                                    amendments, all written statements                                                                             Initiating Participant), in accordance
                                                    with respect to the proposed rule                       I. Self-Regulatory Organization’s
                                                                                                            Statement of the Terms of Substance of                 with the priority algorithm described
                                                    change that are filed with the                                                                                 below, whether Improvement Order(s) 4
                                                    Commission, and all written                             the Proposed Rule Change
                                                                                                                                                                   or Unrelated Order(s) 5 received by
                                                    communications relating to the                            The Exchange proposes to amend                       BOX, or Legging Orders 6 generated
                                                    proposed rule change between the                        BOX Rule 7150 (Price Improvement                       during the PIP (excluding Unrelated
                                                    Commission and any person, other than                   Period (‘‘PIP’’)) to establish the Quality             Orders that were immediately executed
                                                    those that may be withheld from the                     Market Maker allocation in a PIP Order.                during the interval of the PIP). Such
                                                    public in accordance with the                           The text of the proposed rule change is                orders may include agency orders on
                                                    provisions of 5 U.S.C. 552, will be                     available from the principal office of the             behalf of Public Customers, Market
                                                    available for Web site viewing and                      Exchange, at the Commission’s Public                   Makers at away exchanges and non-BOX
                                                    printing in the Commission’s Public                     Reference Room and also on the                         Options Participant broker-dealers, as
                                                    Reference Section, 100 F Street NE.,                    Exchange’s Internet Web site at http://                well as non-PIP proprietary orders
                                                    Washington, DC 20549–1090 on official                   boxexchange.com.                                       submitted by Options Participants.
                                                    business days between the hours of                                                                               The Exchange’s Rules currently
                                                    10:00 a.m. and 3:00 p.m. Copies of the                  II. Self-Regulatory Organization’s
                                                                                                            Statement of the Purpose of, and                       provide the following allocations for
                                                    filing also will be available for                                                                              when the total quantity of orders,
                                                    inspection and copying at the NYSE’s                    Statutory Basis for, the Proposed Rule
                                                                                                            Change                                                 quotes, Improvement Orders, Legging
                                                    principal office. All comments received                                                                        Orders and the Primary Improvement
                                                    will be posted without change; the                        In its filing with the Commission, the               Order is greater than the quantity of the
                                                    Commission does not edit personal                       self-regulatory organization included                  PIP Order at a given price level:
                                                    identifying information from                            statements concerning the purpose of,
                                                    submissions. You should submit only                                                                            Public Customer Allocation
                                                                                                            and basis for, the proposed rule change
                                                    information that you wish to make                       and discussed any comments it received                    All orders, other than Legging Orders
                                                    available publicly. All submissions                     on the proposed rule change. The text                  and the Primary Improvement Order, for
                                                    should refer to File Number SR–                         of these statements may be examined at                 the account of Public Customers,
                                                    NYSEMKT–2016–61 and should be                           the places specified in Item IV below.                 whether Improvement Orders or
                                                    submitted on or before July 22,2016.                    The self-regulatory organization has                   Unrelated Orders, including quotes and
                                                      For the Commission, by the Division of                prepared summaries, set forth in                       orders on the BOX Book 7 prior to the
                                                    Trading and Markets, pursuant to delegated              Sections A, B, and C below, of the most                PIP Broadcast, will be allocated for
                                                    authority.16                                            significant aspects of such statements.                execution against the PIP Order first.8
                                                    Robert W. Errett,                                                                                              Where there are multiple such orders for
                                                    Deputy Secretary.                                       A. Self-Regulatory Organization’s                      the account of Public Customers at the
                                                    [FR Doc. 2016–15715 Filed 6–30–16; 8:45 am]
                                                                                                            Statement of the Purpose of, and                       same price, the trade allocation will be
                                                                                                            Statutory Basis for, the Proposed Rule                 by time priority. If, at the end of the
                                                    BILLING CODE 8011–01–P
                                                                                                            Change                                                 Public Customer allocation, there
                                                                                                            1. Purpose                                             remains any unallocated quantity of the
                                                    SECURITIES AND EXCHANGE                                                                                        PIP Order, the balance will be allocated
                                                    COMMISSION                                                The Exchange proposes to amend                       to the Primary Improvement Order
                                                                                                            BOX Rule 7150 (Price Improvement                       allocation described below.
                                                    [Release No. 34–78171; File No. SR–BOX–                 Period (‘‘PIP’’)) to establish the Quality
                                                    2016–25]                                                                                                       Primary Improvement Order Allocation
                                                                                                            Market Maker allocation in a PIP Order.
                                                    Self-Regulatory Organizations; BOX                      This is a competitive filing that is based                After the Public Customer allocation,
                                                    Options Exchange LLC; Notice of                         on a proposal recently submitted by                    the applicable trade allocation described
                                                    Filing and Immediate Effectiveness of                   NASDAQ OMX BX, Inc. (‘‘BX’’) and                       below will be allocated to the Primary
                                                    a Proposed Rule Change To Amend                         approved by the Commission.3                           Improvement Order.9 After Public
                                                    Rule 7150 (Price Improvement Period                     PIP                                                    Customer Orders have been satisfied,
                                                    (‘‘PIP’’)) To Establish the Quality                                                                            the Initiating Participant’s Primary
                                                    Market Maker Allocation in a PIP Order                    The Exchange currently offers                        Improvement Order retains priority for
                                                                                                            Participants the possibility of price                  up to 40% of the remaining size of the
                                                    June 28, 2016.                                          improvement via its electronic auction                 PIP Order when the Primary
                                                       Pursuant to Section 19(b)(1) of the                  process known as the PIP. The PIP has                  Improvement Order matches any
                                                    Securities Exchange Act of 1934 (the                    saved investors more than $722 million                 competing Improvement Orders and/or
                                                    ‘‘Act’’),1 and Rule 19b–4 thereunder,2                  versus the prevailing NBBO since 2004.                 non-Public Customers’ Unrelated Orders
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    notice is hereby given that on June 15,                 BOX believes that the proposed rule                    at the final price level. If the Primary
                                                    2016, BOX Options Exchange LLC (the                     change will result in tighter and deeper               Improvement Order has designated a
                                                    ‘‘Exchange’’) filed with the Securities                 markets, resulting in more liquidity on
                                                    and Exchange Commission                                 BOX.                                                     4 See BOX Rule 7150(f)(1).
                                                    (‘‘Commission’’) the proposed rule                                                                               5 See BOX Rule 7150(a)(1).
                                                                                                                                                                     6 See BOX Rule 7240(c).
                                                                                                               3 See Securities Exchange Act Release No. 34–
                                                      16 17 CFR 200.30–3(a)(12).                                                                                     7 See BOX Rule 100(a)(10).
                                                                                                            76301 (October 29, 2015), 80 FR 68347 (November
                                                      1 15 U.S.C. 78s(b)(1).                                                                                         8 See BOX Rule 7150(g)(1).
                                                                                                            4, 2016) (Order Approving SR–BX–2015–032). See
                                                      2 17 CFR 240.19b–4.                                   also BX Rule BX Chapter VI, Sec. 9(ii)(E)(3).            9 See BOX Rule 7150(g)(2).




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Document Created: 2016-07-14 11:37:28
Document Modified: 2016-07-14 11:37:28
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation81 FR 43320 

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