81 FR 46724 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Designation of a Longer Period for Commission Action on Proposed Rule Change To List and Trade Shares of the First Trust CEF Income Opportunity ETF and the First Trust Municipal CEF Income Opportunity ETF

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 137 (July 18, 2016)

Page Range		46724-46725
FR Document		2016-16851

Federal Register, Volume 81 Issue 137 (Monday, July 18, 2016)

[Federal Register Volume 81, Number 137 (Monday, July 18, 2016)]
[Notices]
[Pages 46724-46725]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-16851]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-78290; File No. SR-NASDAQ-2016-071]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Designation of a Longer Period for Commission Action on 
Proposed Rule Change To List and Trade Shares of the First Trust CEF 
Income Opportunity ETF and the First Trust Municipal CEF Income 
Opportunity ETF

July 12, 2016.
    On May 10, 2016, The NASDAQ Stock Market LLC (``Exchange'') filed 
with the Securities and Exchange Commission (``Commission''), pursuant 
to section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') 
\1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to list and 
trade shares of the First Trust CEF Income Opportunity ETF and the 
First Trust Municipal CEF Income Opportunity ETF under Nasdaq Rule 
5735, which governs the listing and trading of Managed Fund Shares. On 
May 20, 2016, the Exchange filed Amendment No. 1 to the proposed rule 
change. The proposed rule change was published for comment in the 
Federal Register on May 31, 2016.\3\ The Commission has received one 
comment letter on the proposed rule change.\4\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 77895 (May 24, 
2016), 81 FR 34407.
    \4\ See letter from Stephanie Price, dated May 31, 2016. This 
comment letter is available at: https://www.sec.gov/comments/sr-nasdaq-2016-071/nasdaq2016071-1.htm.
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    Section 19(b)(2) of the Act \5\ provides that, within 45 days of 
the publication of notice of the filing of a proposed rule change, or 
within such longer period up to 90 days as the Commission may designate 
if it finds such longer period to be appropriate and publishes its 
reasons for so finding or as to which the self-regulatory organization 
consents, the Commission shall either approve the proposed rule change, 
disapprove the proposed rule change, or institute proceedings to 
determine whether the proposed rule change should be disapproved. The 
Commission is extending this 45-day time period. The Commission finds 
that it is appropriate to designate a longer period within which to 
take action on the proposed rule change so that it has sufficient time 
to consider the proposed rule change.
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    \5\ 15 U.S.C. 78s(b)(2).
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    Accordingly, the Commission, pursuant to section 19(b)(2) of the 
Act,\6\

[[Page 46725]]

designates August 29, 2016 as the date by which the Commission shall 
either approve or disapprove or institute proceedings to determine 
whether to disapprove the proposed rule change (File Number SR-NASDAQ-
2016-071).
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    \6\ Id.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(31).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-16851 Filed 7-15-16; 8:45 am]
 BILLING CODE 8011-01-P

46724 Federal Register / Vol. 81, No. 137 / Monday, July 18, 2016 / Notices

system, and, in general, to protect replace it with a reference to SECURITIES AND EXCHANGE
investors and the public interest. management in Section 6.1. of the COMMISSION
In particular, the Commission Exchange’s Bylaws will alleviate
believes the proposed rule change will [Release No. 34–78290; File No. SR–
confusion regarding the responsibilities NASDAQ–2016–071]
remove impediments to, and perfect the of the Advisory Board. The Exchange
mechanism of a free and open market notes that the Advisory Board’s Charter Self-Regulatory Organizations; The
and a national market system, and, in provides that the Advisory Board shall NASDAQ Stock Market LLC; Notice of
general, will protect investors and the advise the Board and ‘‘management’’ Designation of a Longer Period for
public interest by updating the Commission Action on Proposed Rule
regarding matters of interest to TPHs.23
delegation of authority to senior Change To List and Trade Shares of
Replacing the term OOC with
management under certain of the the First Trust CEF Income
Exchange’s Rules, which should management will ensure that the
Exchange’s Bylaws conform to the Opportunity ETF and the First Trust
facilitate the Exchange’s ability to Municipal CEF Income Opportunity
operate and carry out its self-regulatory Advisory Board Charter, thereby
reducing uncertainty about the ETF
responsibilities. In particular, the
proposed rule changes to amend Rules responsibilities of the Advisory Board. July 12, 2016.
2.15, 4.10, 6.17, 10.2, and 16.1 to Lastly, the proposed changes to Rules On May 10, 2016, The NASDAQ
replace the references to the Chairman 4.14 and 6.20 will provide the Exchange Stock Market LLC (‘‘Exchange’’) filed
of the Board with the CEO should with additional flexibility should the with the Securities and Exchange
update and clarify which Exchange President be unavailable and thus Commission (‘‘Commission’’), pursuant
official is vested with the authorities unable to carry out the authorities to section 19(b)(1) of the Securities
established in those rules. The Exchange delegated in those rules. The Exchange Act of 1934 (‘‘Act’’) 1 and Rule
represents that while historically the Commission believes that authorizing 19b–4 thereunder,2 a proposed rule
Chairman of the Board also held the title change to list and trade shares of the
the President to designate an
of CEO, currently, the two titles are held First Trust CEF Income Opportunity
appropriately qualified alternate
by different individuals.18 The ETF and the First Trust Municipal CEF
Exchange official to perform the
Exchange Bylaws confer different Income Opportunity ETF under Nasdaq
responsibilities of the President will Rule 5735, which governs the listing
responsibilities on the Chairman of the
clarify the appropriate officials and trading of Managed Fund Shares.
Board and the CEO.19 These proposed
rule changes will ensure that the authorized to carry out certain duties On May 20, 2016, the Exchange filed
authorities delegated pursuant to Rules should the President be unavailable. Amendment No. 1 to the proposed rule
2.15, 4.10, 6.17, 10.2, and 16.1 are Such clarification should perfect the change. The proposed rule change was
consistent with the roles and mechanism of a free and open market published for comment in the Federal
responsibilities established in the and protect investors and the public Register on May 31, 2016.3 The
Bylaws. interest by eliminating potential Commission has received one comment
Similarly, the proposed rule changes uncertainty regarding the appropriate letter on the proposed rule change.4
to amend Rules 4.10 and 18.31 and individual to carry out certain Exchange Section 19(b)(2) of the Act 5 provides
Section 6.1 of the Bylaws to remove authorities in the absence of the that, within 45 days of the publication
references to the OOC will reduce President, which should enable the of notice of the filing of a proposed rule
confusion by eliminating references to a Exchange to continue operations with change, or within such longer period up
term the Exchange believes is minimal disruption. to 90 days as the Commission may
antiquated. The Exchange notes that designate if it finds such longer period
historically the OOC consisted of the IV. Conclusion to be appropriate and publishes its
Chairman of the Board (who also was reasons for so finding or as to which the
It is therefore ordered, pursuant to
the CEO), the Vice-Chairman, and the self-regulatory organization consents,
Section 19(b)(2) of the Act,24 that the
President.20 Currently, however, the the Commission shall either approve the
proposed rule change (SR–CBOE–2016– proposed rule change, disapprove the
Chairman of the Board no longer holds
047) be, and it hereby is, approved. proposed rule change, or institute
the title of CEO and as such does not
bear responsibility for the CEO’s For the Commission, by the Division of proceedings to determine whether the
functions.21 In addition, the Exchange Trading and Markets, pursuant to delegated proposed rule change should be
has eliminated the role of Vice- authority.25 disapproved. The Commission is
Chairman.22 As such, the proposed rule Robert W. Errett, extending this 45-day time period. The
changes to replace the references to the Deputy Secretary. Commission finds that it is appropriate
OOC in Rules 4.10 and 18.31 with [FR Doc. 2016–16853 Filed 7–15–16; 8:45 am]
to designate a longer period within
references to the CEO or President will which to take action on the proposed
BILLING CODE 8011–01–P
remove an outdated term, ensure that rule change so that it has sufficient time
delegated authorities are consistent with to consider the proposed rule change.
the roles and responsibilities delineated Accordingly, the Commission,
in the Bylaws, and will clarify that the pursuant to section 19(b)(2) of the Act,6
authorities in those rules are delegated
asabaliauskas on DSK3SPTVN1PROD with NOTICES

1 15 U.S.C. 78s(b)(1).
solely to the CEO or President.
2 17 CFR 240.19b–4.
Likewise, the Exchange’s proposal to
3 See Securities Exchange Act Release No. 77895
eliminate the reference to the OOC and (May 24, 2016), 81 FR 34407.
4 See letter from Stephanie Price, dated May 31,
18 See Notice, supra note 3, at 36644. 2016. This comment letter is available at: https://
19 See id. www.sec.gov/comments/sr-nasdaq-2016-071/
20 See id. 23 See id. nasdaq2016071-1.htm.
21 See id. 24 15 U.S.C. 78s(b)(2). 5 15 U.S.C. 78s(b)(2).
22 See id. 25 17 CFR 200.30–3(a)(12). 6 Id.

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Federal Register / Vol. 81, No. 137 / Monday, July 18, 2016 / Notices 46725

designates August 29, 2016 as the date at www.batstrading.com, at the proposes to update the Standard Rate
by which the Commission shall either principal office of the Exchange, and at table to reflect the new rebate.
approve or disapprove or institute the Commission’s Public Reference
New Professional Penny Pilot Add
proceedings to determine whether to Room.
Volume Tier
disapprove the proposed rule change
II. Self-Regulatory Organization’s The Exchange currently offers one tier
(File Number SR–NASDAQ–2016–071).
Statement of the Purpose of, and under footnote 9, Professional Penny
For the Commission, by the Division of Statutory Basis for, the Proposed Rule
Trading and Markets, pursuant to delegated Pilot Add Volume Tier. Under that tier
Change (to be renamed Tier 2), a Member
authority.7
Robert W. Errett, In its filing with the Commission, the receives a rebate of $0.43 per contract
Deputy Secretary. Exchange included statements for its orders that yield fee code PA
concerning the purpose of and basis for where it has a combined ADAV 8 in
[FR Doc. 2016–16851 Filed 7–15–16; 8:45 am]
the proposed rule change and discussed Customer 9 and Professional orders
BILLING CODE 8011–01–P
any comments it received on the equal to or greater than 0.20% of
proposed rule change. The text of these average TCV.10 The Exchange now
statements may be examined at the proposes to add a new tier under
SECURITIES AND EXCHANGE
places specified in Item IV below. The footnote 9 to be named Tier 1, under
COMMISSION
Exchange has prepared summaries, set which a Member would receive a rebate
[Release No. 34–78305; File No. SR– forth in sections A, B, and C below, of of $0.40 per contract for its orders that
BatsBZX–2016–36] yield fee code PA where it has an
the most significant parts of such
statements. ADV 11 equal to or greater than 0.25% of
Self-Regulatory Organizations; Bats average TCV. The current tier under
BZX Exchange, Inc.; Notice of Filing (A) Self-Regulatory Organization’s footnote 9 would be renamed Tier 2.
and Immediate Effectiveness of a Statement of the Purpose of, and
Proposed Rule Change Related to Fees Statutory Basis for, the Proposed Rule Customer Add Volume Tier 5
for Use of Bats BZX Exchange, Inc. Change Customer orders that add liquidity on
July 12, 2016. the Exchange in Penny Pilot Securities
1. Purpose
Pursuant to section 19(b)(1) of the yield fee code PY and receive a standard
The Exchange proposes to amend its rebate of $0.25 per contract. In addition,
Securities Exchange Act of 1934 (the
fee schedule for its equity options footnote 1 of the fee schedule currently
‘‘Act’’),1 and Rule 19b–4 thereunder,2
platform (‘‘BZX Options’’) to: (i) Reduce sets forth eight different types of
notice is hereby given that on July 1,
the rate for fee code PA, which is Customer Penny Pilot Add Tiers, each
2016, Bats BZX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘BZX’’) filed with the appended to Professional 6 orders in providing an enhanced rebate ranging
Securities and Exchange Commission Penny Pilot Securities; 7 (ii) add a new from $0.40 to $0.53 per contract to a
(‘‘Commission’’) the proposed rule tier under footnote 9, Professional Member’s Customer orders that yield fee
change as described in Items I, II and III Penny Pilot Add Volume Tiers; (iii) to code PY upon satisfying monthly
below, which Items have been prepared modify the criteria for the Customer volume criteria required by the
by the Exchange. The Exchange has Penny Pilot Add Tier 5 under footnote respective tier.
designated the proposed rule change as 1; and (iv) to modify the criteria for the The Exchange proposes to amend
one establishing or changing a member Non-Customer Penny Pilot Take Volume Customer Add Volume Tier 5 to amend
due, fee, or other charge imposed by the Tier 1 under footnote 3. Additionally, the qualification criteria for the tier. In
Exchange under section 19(b)(3)(A)(ii) the Exchange proposes to rename and order to qualify for Customer Add
of the Act 3 and Rule 19b–4(f)(2) ease the qualifications for the: (i) Firm, Volume Tier 5 and receive a rebate of
thereunder,4 which renders the Broker Dealer, and Joint Back Office $0.53 per contract, the Exchange
proposed rule change effective upon Penny Pilot Add Volume Step-Up Tier currently requires a Member to: (1) Have
filing with the Commission. The under footnote 2; (ii) Firm, Broker an ADAV in Customer orders equal to
Commission is publishing this notice to Dealer, and Joint Back Office Non-Penny or greater than 0.80% of average TCV;
solicit comments on the proposed rule Pilot Add Volume Step-Up Tier under and (2) have an ADAV in Market
change from interested persons. footnote 8; and (iii) the Away Market Maker 12 orders equal to or greater than
Penny Pilot Add Volume Step-Up Tier
I. Self-Regulatory Organization’s under footnote 10. The Exchange also 8 As set forth in the Exchange’s fee schedule,

Statement of the Terms of Substance of proposes to ease the criteria for the ‘‘ADAV’’ means average daily volume calculated as
the Proposed Rule Change the number of contracts added per day.
NBBO Setter Tier 3 under footnote 4. 9 As set forth in the Exchange’s fee schedule, the

The Exchange filed a proposal to Fee Code PA term ‘‘Customer’’ applies to any transaction
amend the fee schedule applicable to identified by a Member for clearing in the Customer
Members 5 and non-members of the The Exchange proposes to reduce the range at the Options Clearing Corporation (‘‘OCC’’),
rebate for fee code PA, under which a excluding any transaction for a Broker Dealer or a
Exchange pursuant to BZX Rules 15.1(a) ‘‘Professional’’ as defined in Exchange Rule 16.1.
and (c). Member is currently receiving a rebate 10 As set forth in the Exchange’s fee schedule,

The text of the proposed rule change of $0.40 per contract for its Professional ‘‘TCV’’ means total consolidated volume calculated
is available at the Exchange’s Web site orders in Penny Pilot Securities. The as the volume reported by all exchanges to the
Exchange proposes to reduce the rebate consolidated transaction reporting plan for the
asabaliauskas on DSK3SPTVN1PROD with NOTICES

month for which the fees apply.
7 17 CFR 200.30–3(a)(31). for fee code PA from $0.40 per contract 11 As set forth in the Exchange’s fee schedule,
1 15 U.S.C. 78s(b)(1). to $0.25 per contract. The Exchange also ‘‘ADV’’ means average daily volume calculated as
2 17 CFR 240.19b–4.
the number of contracts added or removed,
3 15 U.S.C. 78s(b)(3)(A)(ii). 6 The term ‘‘Professional’’ applies to any combined, per day.
4 17 CFR 240.19b–4(f)(2). transaction identified by a Member as such 12 As set forth in the Exchange’s fee schedule, the
5 The term ‘‘Member’’ is defined as ‘‘any pursuant to Exchange Rule 16.1. term ‘‘Market Maker’’ applies to any transaction
registered broker or dealer that has been admitted 7 The term ‘‘Penny Pilot Security’’ applies to identified by a Member for clearing in the Market
to membership in the Exchange.’’ See Exchange those issues that are quoted pursuant to Exchange Maker range at the OCC, where such Member is
Rule 1.5(n). Rule 21.5, Interpretation and Policy .01. Continued

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Document Created: 2016-07-16 02:28:07
Document Modified: 2016-07-16 02:28:07

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 46724