81 FR 45337 - Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing of Proposed Rule Change To Adopt Limit Order Protection
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 134 (July 13, 2016)
Federal Register Volume 81, Issue 134 (July 13, 2016)
| Page Range | 45337-45339 | |
| FR Document | 2016-16486 |
[Federal Register Volume 81, Number 134 (Wednesday, July 13, 2016)] [Notices] [Pages 45337-45339] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-16486] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-78245; File No. SR-Phlx-2016-58] Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing of Proposed Rule Change To Adopt Limit Order Protection July 7, 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 June 24, 2016, NASDAQ PHLX LLC (``Phlx'' 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 the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend NASDAQ PSX Rule 3307, entitled ``Processing of Orders'' to adopt a Limit Order Protection or ``LOP'' for members accessing PSX. The text of the proposed rule change is available on the Exchange's Web site at http://nasdaqomxphlx.cchwallstreet.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to adopt a new mechanism to protect against [[Page 45338]] erroneous Limit Orders which are entered into PSX. Specifically, this new feature addresses risks to market participants of human error in entering Limit Orders at unintended prices. LOP would prevent certain Limit Orders from executing or being placed on the Order Book at prices outside pre-set standard limits. The System would reject those Limit Orders, rather than executing them automatically. The Exchange proposes to adopt a new feature, LOP for Limit Orders, which would reject Limit Orders back to the member when the order exceeds certain defined logic. The Exchange intends to apply LOP system wide. The Exchange reserves the ability to temporarily disable LOP for certain securities in the event of extraordinary market conditions in a certain symbol.\3\ Specifically, the LOP feature would prevent certain Limit Orders at prices outside of pre-set standard limits (``LOP Limit'') from being accepted by the System. LOP shall apply to all Quotes and Orders, including any modified Orders.\4\ LOP would not apply to Market Orders, Market Maker Peg Orders \5\ or Intermarket Sweep Orders (ISO).\6\ A Market Maker Peg Order is a passive order type which will not otherwise remove liquidity from the Order Book. This order type was designed to assist Market Makers with meeting their quoting obligations. Market Makers have a diverse business model as compared with other market participants. Excluding the Market Maker Peg Order from the LOP will assist Market Makers in meeting their quoting obligations. The Exchange believes that because Market Makers have other risk protections in place to prevent them from quoting outside of their financial means, the risk level for erroneous trades is not the same as with other market participants. Market Makers have more sophisticated infrastructures than other market participants and are able to manage their risk, particularly with quoting, utilizing other tools which may not be available to other market participants. An ISO is immediately executable within PSX against orders against which they are marketable. The ISO designation on an order presumes that the market participant has satisfied their obligation to all protected quotes up to the limit of the ISO. --------------------------------------------------------------------------- \3\ For example, LOP may cause a greater number of orders to be rejected in a very volatile market. In the event that the Exchange were to disable LOP in a particular symbol temporarily, the Exchange would immediately notify market participants by sending an alert via an Equities Trader Alert. The Exchange would enable LOP in that symbol as soon as is reasonably practicable and send an updated alert notifying participants that LOP was enabled. \4\ If an Order is modified, LOP will review the order anew and, if LOP is triggered, such modification will not take effect and the original order will be rejected [sic] \5\ A ``Market Maker Peg Order'' is an Order Type designed to allow a Market Maker to maintain a continuous two-sided quotation at a displayed price that is compliant with the quotation requirements for Market Makers set forth in Rule 3213 (a)(2). The displayed price of the Market Maker Peg Order is set with reference to a ``Reference Price'' in order to keep the displayed price of the Market Maker Peg Order within a bounded price range. A Market Maker Peg Order may be entered through RASH or FIX. A Market Maker Peg Order must be entered with a limit price beyond which the Order may not be priced. The Reference Price for a Market Maker Peg Order to buy (sell) is the then-current National Best Bid (National Best Offer) or if no such National Best Bid or National Best Offer, the most recent reported last-sale eligible trade from the responsible single plan processor for that day, or if none, the previous closing price of the security as adjusted to reflect any corporate actions (e.g., dividends or stock splits) in the security. See PSX Rule 3301A. \6\ An Intermarket Sweep or ISO Order, which is an Order that is immediately executable within PSX against Orders against which they are marketable, is not subject to LOP. See PSX Rule 3401(g). --------------------------------------------------------------------------- LOP would be operational each trading day. LOP would not be operational during trading halts and pauses. Also, LOP would not apply in the event that there is no established LOP Reference Price.\7\ The LOP Reference Price shall be the current National Best Bid or Best Offer (NBBO), the bid for sell orders and the offer for buy orders. --------------------------------------------------------------------------- \7\ For example, if there is a one-sided quote or if the LOP Reference Price is less than the greater of 10% or $0.50. --------------------------------------------------------------------------- The Exchange proposes to not accept incoming Limit Orders that exceed the LOP Reference Threshold. Limit Orders will not be accepted if the price of the Limit Order is greater than the LOP Reference Threshold for a buy Limit Order. Limit Orders will not be accepted if the price of the Limit Order is less than the LOP Reference Threshold for a sell Limit Order. The LOP Reference Threshold for buy orders will be the LOP Reference Price (offer) plus the applicable percentage specified [sic] in the LOP Limit. The LOP Reference Threshold for sell orders will be the LOP Reference Price (bid) minus the applicable percentage specified [sic] in the LOP Limit. The LOP Limit shall be the greater of 10% of the LOP Reference Price or $0.50 for all securities across all trading sessions. The LOP Reference Price shall be the current National Best Bid or Best Offer (NBBO), the bid for sell orders and the offer for buy orders. The Exchange also notes that LOP will be applicable on all protocols.\8\ The LOP feature will be mandatory for all PSX members. The Exchange proposes to implement this rule within ninety (90) days of the approval of this proposed rule change. The Exchange will issue an Equities Trader Alert in advance to inform market participants of such implementation date. --------------------------------------------------------------------------- \8\ PSX maintains several communications protocols for members to use in entering Orders and sending other messages to PSX, such as: OUCH, RASH, FLITE and FIX. --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act \9\ in general, and furthers the objectives of Section 6(b)(5) of the Act \10\ 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 mitigating risks to market participants of human error in entering Limit Orders at clearly unintended prices. The proposals are appropriate and reasonable, because they offer protections for Limit Orders which should encourage price continuity and, in turn, protect investors and the public interest by reducing executions occurring at dislocated prices. --------------------------------------------------------------------------- \9\ 15 U.S.C. 78f(b). \10\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The proposed LOP feature would assist with the maintenance of fair and orderly markets by mitigating the risks associated with errors resulting in executions at prices that are away from the Best Bid or Offer and potentially erroneous. Further the proposal protects investors from potentially receiving executions away from the prevailing prices at any given time. The Exchange proposes LOP to avoid a series of improperly priced aggressive orders transacting in the Order Book. The LOP Limit is appropriate because it seeks to capture improperly priced Limit Orders and reject them to reduce the risk of, and to potentially prevent, the automatic execution of Orders at prices that may be considered clearly erroneous. The System will only execute Limit Orders priced within the LOP Limit. The proposed limit of greater than 10% or $0.50 is a reasonable measure to ensure prices remain within the reasonable limits. This protection will bolster the normal resilience and market behavior that persistently produces robust reference prices. This feature should create a level of protection that prevents the Limit Orders from entering the Order Book outside of an acceptable range for the Limit Order to execute. The LOP will reduce the negative impacts of sudden, unanticipated volatility, and serve to preserve an orderly market in a transparent and uniform manner, increase overall [[Page 45339]] market confidence, and promote fair and orderly markets and the protection of investors. This feature is not optional and is applicable to all members submitting Limit Orders. 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. The LOP feature will provide market participants with additional price protection from anomalous executions. This feature is not optional and is applicable to all members submitting Limit Orders. Thus, the Exchange does not believe the proposal creates any significant impact on competition. Offering this protection to the PSX will not impose any undue burden on intra- market competition, rather, it would permit equities and options members to be protected in a similar manner from erroneous executions. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve or disapprove such proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be 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-2016-58 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-2016-58. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-Phlx-2016-58 and should be submitted on or before August 3, 2016. --------------------------------------------------------------------------- \11\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\11\ Brent J. Fields, Secretary. [FR Doc. 2016-16486 Filed 7-12-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 134 / Wednesday, July 13, 2016 / Notices 45337
such that the SDR Relief will expire on publication of notice of the filing of an SECURITIES AND EXCHANGE
the earlier of (1) the date the application for registration (or within COMMISSION
Commission grants registration to an such longer period as to which the [Release No. 34–78245; File No. SR–Phlx–
SDR and (2) June 30, 2016.2 The applicant consents), the Commission 2016–58]
Commission granted the exemptions to will either grant the registration by
help facilitate the potential submission order or institute proceedings to Self-Regulatory Organizations;
of any SDR applications at the time. determine whether registration should NASDAQ PHLX LLC; Notice of Filing of
Since March 18, 2016, two entities be granted or denied. Proposed Rule Change To Adopt Limit
have filed applications to register with Order Protection
the Commission as SDRs.3 To allow the Subject to certain exceptions, section
Commission additional time to review 36 of the Exchange Act 8 authorizes the July 7, 2016.
these applications prior to the Commission, by rule, regulation, or Pursuant to Section 19(b)(1) of the
compliance date for the SDR Rules and order, to exempt, either conditionally or Securities Exchange Act of 1934
the expiration of the SDR Relief, the unconditionally, any person, security, (‘‘Act’’),1 and Rule 19b–4 thereunder,2
Commission is extending the or transaction, or any class or classes of notice is hereby given that on June 24,
exemptions granted in the March 18, persons, securities, or transactions, from 2016, NASDAQ PHLX LLC (‘‘Phlx’’ or
2016 order. any provision or provisions of the ‘‘Exchange’’) filed with the Securities
Exchange Act or any rule or regulation and Exchange Commission (‘‘SEC’’ or
II. Discussion ‘‘Commission’’) the proposed rule
thereunder, to the extent that such
The SDR Rules Release 4 states that exemption is necessary or appropriate change as described in Items I and II
SDRs were required to be in compliance in the public interest, and is consistent below, which Items have been prepared
with the SDR Rules by March 18, 2016. by the Exchange. The Commission is
with the protection of investors. The
The SDR Rules Release also notes that, publishing this notice to solicit
Commission finds that it is necessary
absent an exemption, any SDR must be comments on the proposed rule change
and appropriate in the public interest,
registered with the Commission and in from interested persons.
compliance with the federal securities and consistent with the protection of
investors, to grant a temporary I. Self-Regulatory Organization’s
laws and the rules and regulations
exemption from compliance with the Statement of the Terms of Substance of
thereunder (including the applicable
SDR Rules and an extension of the SDR the Proposed Rule Change
Dodd-Frank Act provisions and all of
the SDR Rules) by March 18, 2016.5 Relief. The applications filed by ICE The Exchange proposes to amend
Since March 18, 2016, two entities Trade Vault and DDR are the first SDR NASDAQ PSX Rule 3307, entitled
have filed applications to register with applications submitted to the ‘‘Processing of Orders’’ to adopt a Limit
the Commission as SDRs. ICE Trade Commission and therefore present Order Protection or ‘‘LOP’’ for members
Vault, LLC (‘‘ICE Trade Vault’’) filed issues of first impression for the accessing PSX.
with the Commission a Form SDR Commission’s consideration. Therefore, The text of the proposed rule change
seeking registration as an SDR on March to allow the Commission additional is available on the Exchange’s Web site
29, 2016 and amended that form on time prior to the compliance date for the at http://
April 18, 2016. The Commission’s SDR Rules and the expiration of the nasdaqomxphlx.cchwallstreet.com, at
notice of ICE Trade Vault’s application the principal office of the Exchange, and
SDR Relief to review the applications
for registration as an SDR was published at the Commission’s Public Reference
and consider issues related to the first
in the Federal Register on April 28, Room.
applications for registration of SDRs, the
2016.6 DTCC Data Repository (U.S.) LLC Commission hereby grants, pursuant to II. Self-Regulatory Organization’s
(‘‘DDR’’) filed with the Commission a Section 36 of the Exchange Act, a Statement of the Purpose of, and
Form SDR seeking registration as an temporary exemption from compliance Statutory Basis for, the Proposed Rule
SDR on April 6, 2016 and amended that with the SDR Rules and an extension of Change
form on April 25, 2016. The
the SDR Relief until October 5, 2016, In its filing with the Commission, the
Commission’s notice of DDR’s
which is 90 days from publication of Exchange included statements
application for registration as an SDR
notice of DDR’s application for concerning the purpose of and basis for
was published in the Federal Register
registration as a SDR. the proposed rule change and discussed
on July 7, 2016.7 Rule 13n–1(c) provides
any comments it received on the
that, within 90 days of the date of the By the Commission.
proposed rule change. The text of these
Brent J. Fields, statements may be examined at the
2 See Exchange Act Release No. 77400 (Mar. 18,
Secretary. places specified in Item IV below. The
2016), 81 FR 15599 (Mar. 23, 2016) (‘‘SDR Section
36 Order’’). [FR Doc. 2016–16541 Filed 7–12–16; 8:45 am] Exchange has prepared summaries, set
3 See Exchange Act Release No. 77699 (Apr. 22,
BILLING CODE 8011–01–P forth in sections A, B, and C below, of
2016), 81 FR 25475 (Apr. 28, 2016) (‘‘ICE Trade the most significant aspects of such
Vault Notice’’) and Exchange Act Release No. 34–
78216 (June 30, 2016), 81 FR 44379 (July 7, 2016) statements.
(‘‘DDR Notice’’).
4 See Exchange Act Release No. 74246 (Feb. 11,
A. Self-Regulatory Organization’s
2015), 80 FR 14438 (Mar. 19, 2015) (‘‘SDR Rules Statement of the Purpose of, and
Release’’). Statutory Basis for, the Proposed Rule
jstallworth on DSK7TPTVN1PROD with NOTICES
5 See id., 80 FR at 14456. The SDR Rules Release Change
also notes that all exemptions that the Commission
provided in a previous release, including the 1. Purpose
exemption to provisions in Exchange Act Section
13(n), will expire on the March 18, 2016
The Exchange proposes to adopt a
compliance date. See id. (discussing the DFA new mechanism to protect against
Effective Date Order).
6 See ICE Trade Vault Notice. 1 15 U.S.C. 78s(b)(1).
7 See DDR Notice. 8 15 U.S.C. 78mm. 2 17 CFR 240.19b–4.
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erroneous Limit Orders which are with other market participants. (90) days of the approval of this
entered into PSX. Specifically, this new Excluding the Market Maker Peg Order proposed rule change. The Exchange
feature addresses risks to market from the LOP will assist Market Makers will issue an Equities Trader Alert in
participants of human error in entering in meeting their quoting obligations. advance to inform market participants
Limit Orders at unintended prices. LOP The Exchange believes that because of such implementation date.
would prevent certain Limit Orders Market Makers have other risk
2. Statutory Basis
from executing or being placed on the protections in place to prevent them
Order Book at prices outside pre-set from quoting outside of their financial The Exchange believes that its
standard limits. The System would means, the risk level for erroneous proposal is consistent with Section 6(b)
reject those Limit Orders, rather than trades is not the same as with other of the Act 9 in general, and furthers the
executing them automatically. market participants. Market Makers objectives of Section 6(b)(5) of the Act 10
The Exchange proposes to adopt a have more sophisticated infrastructures in particular, in that it is designed to
new feature, LOP for Limit Orders, than other market participants and are promote just and equitable principles of
which would reject Limit Orders back to able to manage their risk, particularly trade, to remove impediments to and
the member when the order exceeds with quoting, utilizing other tools which perfect the mechanism of a free and
certain defined logic. The Exchange may not be available to other market open market and a national market
intends to apply LOP system wide. The participants. An ISO is immediately system, and, in general to protect
Exchange reserves the ability to executable within PSX against orders investors and the public interest, by
temporarily disable LOP for certain against which they are marketable. The mitigating risks to market participants of
securities in the event of extraordinary ISO designation on an order presumes human error in entering Limit Orders at
market conditions in a certain symbol.3 that the market participant has satisfied clearly unintended prices. The
Specifically, the LOP feature would their obligation to all protected quotes proposals are appropriate and
prevent certain Limit Orders at prices up to the limit of the ISO. reasonable, because they offer
outside of pre-set standard limits (‘‘LOP LOP would be operational each protections for Limit Orders which
Limit’’) from being accepted by the trading day. LOP would not be should encourage price continuity and,
System. LOP shall apply to all Quotes operational during trading halts and in turn, protect investors and the public
and Orders, including any modified pauses. Also, LOP would not apply in interest by reducing executions
Orders.4 LOP would not apply to Market the event that there is no established occurring at dislocated prices.
Orders, Market Maker Peg Orders 5 or LOP Reference Price.7 The LOP The proposed LOP feature would
Intermarket Sweep Orders (ISO).6 A Reference Price shall be the current assist with the maintenance of fair and
Market Maker Peg Order is a passive National Best Bid or Best Offer (NBBO), orderly markets by mitigating the risks
order type which will not otherwise the bid for sell orders and the offer for associated with errors resulting in
remove liquidity from the Order Book. buy orders. executions at prices that are away from
This order type was designed to assist The Exchange proposes to not accept the Best Bid or Offer and potentially
Market Makers with meeting their incoming Limit Orders that exceed the erroneous. Further the proposal protects
quoting obligations. Market Makers have LOP Reference Threshold. Limit Orders investors from potentially receiving
a diverse business model as compared will not be accepted if the price of the executions away from the prevailing
Limit Order is greater than the LOP prices at any given time. The Exchange
3 For example, LOP may cause a greater number Reference Threshold for a buy Limit proposes LOP to avoid a series of
of orders to be rejected in a very volatile market. Order. Limit Orders will not be accepted improperly priced aggressive orders
In the event that the Exchange were to disable LOP transacting in the Order Book. The LOP
in a particular symbol temporarily, the Exchange
if the price of the Limit Order is less
would immediately notify market participants by than the LOP Reference Threshold for a Limit is appropriate because it seeks to
sending an alert via an Equities Trader Alert. The sell Limit Order. The LOP Reference capture improperly priced Limit Orders
Exchange would enable LOP in that symbol as soon Threshold for buy orders will be the and reject them to reduce the risk of,
as is reasonably practicable and send an updated
alert notifying participants that LOP was enabled.
LOP Reference Price (offer) plus the and to potentially prevent, the
4 If an Order is modified, LOP will review the applicable percentage specified [sic] in automatic execution of Orders at prices
order anew and, if LOP is triggered, such the LOP Limit. The LOP Reference that may be considered clearly
modification will not take effect and the original Threshold for sell orders will be the erroneous. The System will only
order will be rejected [sic] LOP Reference Price (bid) minus the execute Limit Orders priced within the
5 A ‘‘Market Maker Peg Order’’ is an Order Type
designed to allow a Market Maker to maintain a applicable percentage specified [sic] in LOP Limit. The proposed limit of
continuous two-sided quotation at a displayed price the LOP Limit. The LOP Limit shall be greater than 10% or $0.50 is a
that is compliant with the quotation requirements the greater of 10% of the LOP Reference reasonable measure to ensure prices
for Market Makers set forth in Rule 3213 (a)(2). The Price or $0.50 for all securities across all remain within the reasonable limits.
displayed price of the Market Maker Peg Order is
set with reference to a ‘‘Reference Price’’ in order trading sessions. The LOP Reference This protection will bolster the normal
to keep the displayed price of the Market Maker Peg Price shall be the current National Best resilience and market behavior that
Order within a bounded price range. A Market Bid or Best Offer (NBBO), the bid for persistently produces robust reference
Maker Peg Order may be entered through RASH or sell orders and the offer for buy orders. prices. This feature should create a level
FIX. A Market Maker Peg Order must be entered
with a limit price beyond which the Order may not The Exchange also notes that LOP of protection that prevents the Limit
be priced. The Reference Price for a Market Maker will be applicable on all protocols.8 The Orders from entering the Order Book
Peg Order to buy (sell) is the then-current National LOP feature will be mandatory for all outside of an acceptable range for the
Best Bid (National Best Offer) or if no such National PSX members. The Exchange proposes Limit Order to execute.
Best Bid or National Best Offer, the most recent
jstallworth on DSK7TPTVN1PROD with NOTICES
reported last-sale eligible trade from the responsible to implement this rule within ninety The LOP will reduce the negative
single plan processor for that day, or if none, the impacts of sudden, unanticipated
previous closing price of the security as adjusted to 7 For example, if there is a one-sided quote or if
volatility, and serve to preserve an
reflect any corporate actions (e.g., dividends or the LOP Reference Price is less than the greater of orderly market in a transparent and
stock splits) in the security. See PSX Rule 3301A. 10% or $0.50.
6 An Intermarket Sweep or ISO Order, which is 8 PSX maintains several communications
uniform manner, increase overall
an Order that is immediately executable within PSX protocols for members to use in entering Orders and
9 15 U.S.C. 78f(b).
against Orders against which they are marketable, sending other messages to PSX, such as: OUCH,
is not subject to LOP. See PSX Rule 3401(g). RASH, FLITE and FIX. 10 15 U.S.C. 78f(b)(5).
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market confidence, and promote fair Paper Comments Rule 15Ba2–1 and Form MSD; SEC File No.
and orderly markets and the protection 270–0088, OMB Control No. 3235–0083.
of investors. This feature is not optional • Send paper comments in triplicate
Notice is hereby given that pursuant
and is applicable to all members to Secretary, Securities and Exchange
to the Paperwork Reduction Act of 1995
submitting Limit Orders. Commission, 100 F Street NE.,
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Washington, DC 20549–1090.
B. Self-Regulatory Organization’s Securities and Exchange Commission
All submissions should refer to File (‘‘Commission’’) is soliciting comments
Statement on Burden on Competition Number SR–Phlx–2016–58. This file on the existing collection of information
The Exchange does not believe that number should be included on the provided for in Rule 15Ba2–1 (17 CFR
the proposed rule change will impose subject line if email is used. To help the 240.15Ba2–1) and Form MSD (17 CFR
any burden on competition not Commission process and review your 249.1100), under the Securities and
necessary or appropriate in furtherance comments more efficiently, please use Exchange Act of 1934 (15 U.S.C. 78a et
of the purposes of the Act. The LOP only one method. The Commission will seq.) (‘‘Exchange Act’’). The
feature will provide market participants post all comments on the Commission’s Commission plans to submit this
with additional price protection from Internet Web site (http://www.sec.gov/ existing collection of information to the
anomalous executions. This feature is rules/sro.shtml). Copies of the Office of Management and Budget
not optional and is applicable to all submission, all subsequent (‘‘OMB’’) for extension and approval.
members submitting Limit Orders. amendments, all written statements Rule 15Ba2–1 provides that an
Thus, the Exchange does not believe the with respect to the proposed rule application for registration with the
proposal creates any significant impact change that are filed with the Commission by a bank municipal
on competition. Offering this protection Commission, and all written securities dealer must be filed on Form
to the PSX will not impose any undue communications relating to the MSD. The Commission uses the
burden on intra-market competition, proposed rule change between the information obtained from Form MSD
rather, it would permit equities and Commission and any person, other than filings to determine whether bank
options members to be protected in a those that may be withheld from the municipal securities dealers meet the
similar manner from erroneous public in accordance with the standards for registration set forth in the
executions. provisions of 5 U.S.C. 552, will be Act, to maintain a central registry where
available for Web site viewing and members of the public may obtain
C. Self-Regulatory Organization’s information about particular bank
Statement on Comments on the printing in the Commission’s Public
Reference Room, 100 F Street NE., municipal securities dealers, and to
Proposed Rule Change Received From develop risk assessment information
Members, Participants, or Others Washington, DC 20549, on official
business days between the hours of about bank municipal securities dealers.
No written comments were either 10:00 a.m. and 3:00 p.m. Copies of the Based upon past submissions, the
solicited or received. filing also will be available for staff estimates that approximately 21
inspection and copying at the principal respondents will utilize this application
III. Date of Effectiveness of the procedure annually. The staff estimates
Proposed Rule Change and Timing for office of the Exchange. All comments
received will be posted without change; that the average number of hours
Commission Action necessary to comply with the
the Commission does not edit personal
Within 45 days of the date of identifying information from requirements of Rule 15Ba2–1 and Form
publication of this notice in the Federal submissions. You should submit only MSD is 1.5 hours per respondent, for a
Register or within such longer period information that you wish to make total burden of approximately 31.5
up to 90 days (i) as the Commission may available publicly. All submissions hours per year. The staff estimates that
designate if it finds such longer period should refer to File Number SR–Phlx– the average internal compliance cost per
to be appropriate and publishes its 2016–58 and should be submitted on or hour is approximately $343. Therefore,
reasons for so finding or (ii) as to which before August 3, 2016. the estimated total annual cost of
the self-regulatory organization compliance for the respondents is
consents, the Commission will: For the Commission, by the Division of approximately $10,805.
Trading and Markets, pursuant to delegated Written comments are invited on: (a)
(A) By order approve or disapprove
authority.11
such proposed rule change, or Whether the proposed collection of
(B) institute proceedings to determine Brent J. Fields, information is necessary for the proper
whether the proposed rule change Secretary. performance of the functions of the
should be disapproved. [FR Doc. 2016–16486 Filed 7–12–16; 8:45 am] Commission, including whether the
BILLING CODE 8011–01–P information shall have practical utility;
IV. Solicitation of Comments (b) the accuracy of the Commission’s
Interested persons are invited to estimate of the burden of the collection
submit written data, views, and SECURITIES AND EXCHANGE of information; (c) ways to enhance the
arguments concerning the foregoing, COMMISSION quality, utility, and clarity of the
including whether the proposed rule information to be collected; and (d)
change is consistent with the Act. Proposed Collection; Comment ways to minimize the burden of the
Comments may be submitted by any of Request collection of information on
the following methods: respondents, including through the use
Upon Written Request, Copies Available
jstallworth on DSK7TPTVN1PROD with NOTICES
of automated collection techniques or
Electronic Comments From: Securities and Exchange
other forms of information technology.
• Use the Commission’s Internet Commission, Office of FOIA Services,
Consideration will be given to
comment form (http://www.sec.gov/ 100 F Street NE., Washington, DC
comments and suggestions submitted in
rules/sro.shtml); or 20549–2736.
writing within 60 days of this
• Send an email to rule-comments@ Extension: publication.
sec.gov. Please include File Number SR– An agency may not conduct or
Phlx–2016–58 on the subject line. 11 17 CFR 200.30–3(a)(12). sponsor, and a person is not required to
VerDate Sep<11>2014 15:08 Jul 12, 2016 Jkt 238001 PO 00000 Frm 00066 Fmt 4703 Sfmt 4703 E:\FR\FM\13JYN1.SGM 13JYN1](https://thefederalregister.org/doc/81_FR_45471/page/3.svg)
Document Created: 2016-07-13 01:44:13
Document Modified: 2016-07-13 01:44:13
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 81 FR 45337 |
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