81 FR 53180 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Proposed Rule Change, as Modified by Amendment No. 1, Amending NYSE Rule 49 Regarding: (1) The Exchange's Emergency Powers; (2) the Exchange's Disaster Recovery Plans; and (3) Exchange Backup Systems and Mandatory Testing
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 155 (August 11, 2016)
Federal Register Volume 81, Issue 155 (August 11, 2016)
| Page Range | 53180-53184 | |
| FR Document | 2016-19054 |
[Federal Register Volume 81, Number 155 (Thursday, August 11, 2016)] [Notices] [Pages 53180-53184] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-19054] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-78484; File No. SR-NYSE-2016-48] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Proposed Rule Change, as Modified by Amendment No. 1, Amending NYSE Rule 49 Regarding: (1) The Exchange's Emergency Powers; (2) the Exchange's Disaster Recovery Plans; and (3) Exchange Backup Systems and Mandatory Testing August 5, 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 July 29, 2016, New York Stock Exchange LLC (``NYSE'' or the ``Exchange'') 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 NYSE Rule 49 (Emergency Powers) by (1) replacing the text of current Rule 49 with the Exchange's proposed disaster recovery plans; and (2) moving the text of current Rule 438 (Exchange Backup Systems and Mandatory Testing) to Rule 49. This Amendment No. 1 supersedes the original filing in its entirety. 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 proposes to amend Rule 49, which addresses the Exchange's emergency powers, by (1) replacing the text of current Rule 49 with the Exchange's proposed disaster recovery plans; and (2) moving the text of current Rule 438 (Exchange Backup Systems and Mandatory Testing) to Rule 49 with no substantive changes. The Exchange proposes to amend Rule 49 in two ways. First, the Exchange proposes to replace the current disaster recovery plan, pursuant to which NYSE Arca, Inc. (``NYSE Arca''), the Exchange's affiliate, acts on behalf of and at the direction of the Exchange for auctions and specified regulatory messages in Exchange-listed securities, with a new disaster recovery plan that the Exchange would implement if the Exchange's primary data center is impaired. Under the proposed disaster recovery plan, the Exchange would no longer rely on NYSE Arca to act on its behalf. Rather, the Exchange would operate as a fully electronic exchange under its own trading rules and would maintain its own order book in its [[Page 53181]] disaster recovery facility. In addition, quotes and trades would be published to the securities information processor (``SIP'') as quotes and trades of the Exchange. To reflect this change, the Exchange proposes to delete Rule 49 (Emergency Powers) in its entirety and replace it with new proposed Rule 49(a).\4\ --------------------------------------------------------------------------- \4\ Because the Exchange would not implement proposed Rule 49(a) until after an opportunity to test it with Exchange member organizations, the Exchange proposes to retain current Rule 49 on its books and not delete it until after proposed Rule 49(a) is approved. The Exchange also proposes to file a separate proposed rule change to establish the operative date of paragraph (a) of proposed Rule 49 and delete the current version of the Rule. To reduce the potential for any confusion regarding which version of the rule governs, the Exchange proposes to add the following preamble to current Rule 49: ``This version of Rule 49 will remain operative until the proposed rule changes described in SR-NYSE-2016- 48 are approved and the Exchange files a separate proposed rule change to delete this version of Rule 49 and preamble and to establish the operative date of paragraph (a) of `Rule 49. Exchange Business Continuity and Disaster Recovery Plans and Mandatory Testing.' Subject to such separate proposed rule change, the Exchange will announce via Trader Update the operative date of the deletion of this Rule and implementation of paragraph (a) of Rule 49. Exchange Business Continuity and Disaster Recovery Plans and Mandatory Testing.'' The Exchange also proposes to add a preamble to proposed Rule 49, which would provide: ``The Exchange will file a separate proposed rule change to establish the operative date of paragraph (a) of this version of Rule 49 and to delete `Rule 49. Emergency Powers' and this preamble. Until such time, `Rule 49. Emergency Powers' will remain operative. Subject to such separate proposed rule change, the Exchange will announce via Trader Update the operative date of paragraph (a) of this Rule and deletion of `Rule 49. Emergency Powers.' '' --------------------------------------------------------------------------- Second, the Exchange proposes to move text from Rule 438 governing Exchange Backup Systems and Mandatory Testing, to proposed Rule 49(b)(N) with only non-substantive changes to update sub-paragraph numbering and cross references. Because Rule 438 relates to mandatory testing of the Exchange's disaster recovery facility, as required by Rule 1004 of Regulation SCI,\5\ the Exchange believes that moving the rule text from Rule 438 to Rule 49 would make the Exchange's rules easier to navigate by consolidating rules with a common theme into a single rule. To incorporate that proposed Rule 49 would also cover mandatory testing requirements, the Exchange also proposes to change the title of Rule 49 to ``Exchange Business Continuity and Disaster Recovery Plans and Mandatory Testing.'' --------------------------------------------------------------------------- \5\ 17 CFR 242.1004. --------------------------------------------------------------------------- Background In 2009, the Exchange adopted Rule 49 to provide the Exchange with the authority to declare an Emergency Condition with respect to trading on or through the systems and facilities of the Exchange and to act as necessary in the public interest and for the protection of investors.\6\ The authority in Rule 49 may be exercised when, due to an Emergency Condition,\7\ the Exchange's systems and facilities located at 11 Wall Street, New York, New York, including the NYSE Trading Floor, cannot be utilized, or if the Exchange's primary data center is impaired. If such an Emergency Condition is declared, a qualified Exchange officer may designate NYSE Arca to serve as a backup facility so that the Exchange, as a self-regulatory organization (``SRO''), can remain operational.\8\ NYSE Arca also would continue to operate simultaneously. Because under the original version of Rule 49, quotes and trades of Exchange-listed securities would continue to be reported to the SIP as quotes and trades of the Exchange, this disaster recovery plan was referred to as the ``Print as N'' plan. --------------------------------------------------------------------------- \6\ See Securities Exchange Act Release No. 61177 (December 16, 2009), 74 FR 68643 (December 28, 2009) (SR-NYSE-2009-105) (``2009 Approval Order''). At the same time, NYSE Arca amended NYSE Arca Equities Rule 2.100 to provide that NYSE Arca Equities would receive and process bids and offers in Exchange-listed securities on behalf of the Exchange. See Securities Exchange Act Release No. 61178 (Dec. 16, 2009), 74 FR 68434 (Dec. 24, 2009) (SR-NYSEArca-2009-90). \7\ Under current Rule 49, an ``Emergency Condition'' means an emergency as defined in Section 12(k)(7) of the Act, which is ``(A) a major market disturbance characterized by or constituting--(i) sudden and excessive fluctuations of securities prices generally, or a substantial threat thereof, that threaten fair and orderly markets; or (ii) a substantial disruption of the safe or efficient operation of the national system for clearance and settlement of transactions in securities, or a substantial threat thereof; or (B) a major disturbance that substantially disrupts, or threatens to substantially disrupt--(i) the functioning of securities markets, investment companies, or any other significant portion or segment of the securities markets; or (ii) the transmission or processing of securities transactions.'' 15 U.S.C. 78l(k)(7). \8\ NYSE Arca trades equity securities on the systems and facilities of its wholly owned subsidiary, NYSE Arca Equities, Inc., referred to as the ``NYSE Arca Marketplace.'' For the purposes of this filing and in the text of Rule 49, these shall be referred to collectively as the systems and facilities of NYSE Arca, or simply NYSE Arca. --------------------------------------------------------------------------- In November 2013, the Securities and Exchange Commission (``Commission'') approved amendments to Rule 49 that were designed to more effectively delineate the SRO functions of the Exchange and NYSE Arca during an Emergency Condition, reflect the operational preferences of the industry, and reflect the structure of member organization connectivity to and system coding for exchange systems.\9\ In September 2014, the Exchange further amended Rule 49 to revise how certain messages are disseminated.\10\ --------------------------------------------------------------------------- \9\ See Securities Exchange Act Release No. 70822 (November 6, 2013), 78 FR 68128 (November 13, 2013) (SR-NYSE-2013-54; SR-NYSEMKT- 2013-66; SR-NYSEArca-2013-77) (``2013 Approval Order''). This release approved the amendment to Rule 49 as well as amendments to NYSE Arca Rule 2.100 and adoption of NYSE MKT LLC (``NYSE MKT'') Rule 49--Equities. \10\ See Securities Exchange Act Release No. 73028 (Sept. 9, 2014), 79 FR 55056 (Sept. 15, 2014) (SR-NYSE-2014-48) (``2014 Approval Order''). --------------------------------------------------------------------------- Under current Rule 49, if the Exchange declares an Emergency Condition, the Exchange will halt all trading on the Exchange's systems and facilities and purge any unexecuted orders from the Exchange's own systems and facilities as soon as practicable following declaration of the Emergency Condition.\11\ Beginning the next trading day, NYSE Arca, on behalf of and at the direction of the Exchange, will disseminate the official opening, re-opening, and closing trades of Exchange-listed securities to the Consolidated Tape as message of the Exchange, and any notification for Exchange listed securities to the Consolidated Quotation System of a regulatory halt and resumption of trading thereafter, trading pause and resumption of trading thereafter, and Short Sale Price Test trigger and lifting thereafter, as messages of the Exchange.\12\ --------------------------------------------------------------------------- \11\ See Rule 49(b)(1). \12\ See Rule 49(b)(2)(A)(i) and (ii). --------------------------------------------------------------------------- In addition, bids and offers for Exchange-listed securities entered on or through the systems and facilities of NYSE Arca during the Emergency Condition will be reported to the Consolidated Quotation system as bids and offers of NYSE Arca, except that the opening quote will be reported to the Consolidated Quotation System as a bid and/or offer of both the Exchange and NYSE Arca and any re-opening quote will be reported to the Consolidated Quotation System as a bid and/or offer of the Exchange only. Bids and offers for Exchange-listed securities executed on or through the systems and facilities of NYSE Arca during the Emergency Condition will be reported to the Consolidated Tape as executions of NYSE Arca, except for executions in the opening, re- opening, or closing transactions, which will be reported as Exchange executions and Exchange volume only.\13\ Because intra-day quotes and trades in Exchange-listed securities would be reported to the SIP as quotes and trades of NYSE Arca (except for the opening, reopening and closing trades), this disaster recovery plan is referred to the ``Print as P'' plan. --------------------------------------------------------------------------- \13\ See Rule 49(2)(B). --------------------------------------------------------------------------- Since adopting Rule 49, the Exchange has amended its rules to provide for Exchange-facilitated procedures for [[Page 53182]] opening and closing securities if either a Designated Market Maker (``DMM'') or the Exchange's 11 Wall Street facilities are unavailable for one or more securities.\14\ Because the Exchange can now operate even in the absence of 11 Wall Street facilities, and because the Exchange's Print as P disaster recovery plan is available in the exchange's secondary data center, Rule 49 would be invoked only if an Emergency Condition impacted the Exchange's primary data center. To date, the Exchange has not invoked Rule 49. --------------------------------------------------------------------------- \14\ See Rules 123D(a)(2)-(6) (describing process for the Exchange to facilitate the open and reopen of trading) and Supplementary Material .10 to Rule 123C (describing process for the Exchange to facilitate the close of trading). --------------------------------------------------------------------------- Proposed Rule Change Proposed Rule 49(a) would govern the Exchange's Disaster Recovery Facility. As proposed, Rule 49(a)(1) would provide that, as part of its business continuity and disaster recovery plans, the Exchange maintains a ``Disaster Recovery Facility,'' which is a secondary data center located in a geographically diverse location, as required by Regulation SCI.\15\ This proposed rule text is intended to be definitional, and describes that the Exchange maintains a secondary data center. --------------------------------------------------------------------------- \15\ See 17 CFR 242.1001(a)(2)(v) (requiring policies and procedures for business continuity and disaster recovery plans that including maintaining backup and recovery capabilities sufficiently resilient and geographically diverse and that are reasonably designed to achieve next business day resumption of trading and two- hour resumption of critical SCI systems following a wide-scale disruption). --------------------------------------------------------------------------- Proposed Rule 49(a)(2) would specify the procedures that the Exchange would follow if the Exchange determines under Rule 51 to trade Exchange-traded securities on its Disaster Recovery Facility. Currently, Rule 49(a)(1) provides that a qualified Exchange officer shall have the authority to declare an Emergency Condition and current Rule 49(a)(3)(B) defines the term ``qualified Exchange officer'' to mean the ICE Chief Executive Officer or his or her designee, or the Chief Regulatory Officer of the Exchange or his or her designee. The rule further provides that in the event that none of these individuals is able to act due to incapacitation, the most senior surviving officer of ICE or the Exchange shall be a ``qualified Exchange officer'' for purposes of Rule 49. Rather than specifying separately in Rule 49 who can act under that rule, the Exchange proposes to include in Rule 51 the authority to determine whether to use the Exchange's Disaster Recovery Facility. Rule 51(b) currently provides that, except as may be otherwise determined by the Exchange Board of Directors, the Chief Executive Officer (``CEO'') of the Exchange shall have the power to: (i) Halt or suspend trading in some or all securities trading on the Exchange; (ii) extend the hours for the transaction of business on the Exchange; (iii) close some or all Exchange facilities; or (iv) determine the duration of any halt, suspension or closing undertaken under this Rule. Rule 51(c) specifies the circumstances under which the CEO may take these actions, which includes a loss or interruption of facilities utilized by the Exchange.\16\ --------------------------------------------------------------------------- \16\ See Rule 51(c)(1). --------------------------------------------------------------------------- The Exchange believes that the authority to determine to trade Exchange-traded securities in its Disaster Recovery Facility should similarly be vested with the CEO of the Exchange. Specifically, the CEO may already take the above-specified actions under Rule 51(b) if there is a loss or interruption of facilities utilized by the Exchange. The Exchange believes that a loss or interruption of the Exchange's primary data center is an event contemplated in Rule 51(c), and therefore the authority to take an action based on that event, whether suspending trading or determining to use the Disaster Recovery Facility, should be determined by the same person. Accordingly, the Exchange proposes to add proposed Rule 51(b)(v) to specify that the CEO of the Exchange may determine to trade securities on the Exchange's Disaster Recovery Facility pursuant to Rule 49.\17\ --------------------------------------------------------------------------- \17\ Under Rule 1, the CEO may formally designate one or more qualified employees of Intercontinental Exchange Group, Inc. to act in place of any person named in a rule as having authority to act under such rule in the event that the named person in the rule is not available to administer that rule. Because Rule 1 already provides the authority to designated alternate qualified employees, the Exchange would not include rule text from current Rule 49(a)(3)(B) regarding who may be designated to act in proposed Rule 51 in the absence of the CEO. --------------------------------------------------------------------------- The Exchange also proposes non-substantive amendments to Rule 51(b) to provide that the CEO ``may take any of the following actions'' rather than to provide that the CEO ``shall have the power to.'' The Exchange believes the proposed amendment makes clear that the CEO may invoke one or more of the actions specified in Rule 51(b)(i)-(v). For the same reason, the Exchange proposes to make a conforming amendment to Rule 51(c) to specify that the CEO shall take any of the actions described in paragraph (b) above. The Exchange proposes that the following would apply if the Exchange determines under Rule 51 to trade Exchange-traded securities on its Disaster Recovery Facility:Proposed Rule 49(a)(2)(A) would provide that the 11 Wall Street facilities would not be available for trading if the Exchange is operating from its Disaster Recovery Facility. Because the trading systems in the Exchange's Disaster Recovery Facility would not have connectivity to DMM and Floor broker trading systems, the Exchange would operate as a fully electronic exchange when operating out of its Disaster Recovery Facility, even if 11 Wall Street facilities were not impacted. Proposed Rule 49(a)(2)(B) would provide that opening and reopening auctions would be subject to Rule 123D(a)(2)-(6) and closing auctions would be subject to Supplementary Material .10 to Rule 123C. Because there would be no Trading Floor or DMM connectivity, the Exchange proposes that, when operating out of its Disaster Recovery Facility, the Exchange would facilitate all openings, reopenings, and closings, as provided for in the enumerated rules. As noted above, this is the Exchange's current business continuity plan if the 11 Wall Street facilities were unavailable, but the Exchange could continue to operate out of its primary data center. Proposed Rule 49(a)(2)(C) would provide that any unexecuted orders entered into Exchange systems before trading on the Disaster Recovery Facility begins would be deemed cancelled and would be purged from Exchange systems. This proposed rule text is based on current Rule 49(b)(1)(B), which provides that when an Emergency Condition is declared, the Exchange will purge any unexecuted orders from the Exchange's own systems and facilities as soon as practicable following declaration of the Emergency Condition. The Exchange proposes to modify this text in proposed Rule 49(a)(2)(C) to make clear that any unexecuted orders entered into Exchange systems before trading on the Disaster Recovery Facility begins would be deemed cancelled because depending on the scope of the disruption, the Exchange may not be able to transmit cancellation messages for unexecuted orders. Proposed Rule 49(a)(2)(D) would provide that member organizations registered as DMMs would not be subject to any DMM obligations or benefits under Exchange rules while securities trade on the Disaster Recovery Facility.\18\ DMMs would not be subject to any such obligations or benefits [[Page 53183]] because the Exchange will not maintain systems that support DMM quoting at its Disaster Recovery Facility. DMMs that route orders to the Disaster Recovery Facility would trade no differently than other market participants that electronically enter orders at the Exchange, and would be subject to the fees and credits applicable to non-DMM transactions. --------------------------------------------------------------------------- \18\ See, e.g., Rules 103B(I) (quoting requirements for allocation process of listed securities) and 104 (Dealings and Responsibilities of DMMs). --------------------------------------------------------------------------- Proposed Rule 49(a)(3) would provide that member organizations wishing to trade on the Exchange's Disaster Recovery Facility would be responsible for having contingency plans for establishing connectivity to such facility and changing routing instructions for their order entry systems to send bids and offers in Exchange-traded securities to such facility. This proposed rule text is based on current Rule 49(b)(3), but references connectivity to the Exchange's Disaster Recovery Facility rather than connectivity to NYSE Arca. As noted above, because the Exchange would no longer be designating NYSE Arca to act on behalf of and at the direction of the Exchange, the Exchange would not include the provisions of current Rule 49(a)(1) and (b) relating to such designation. The Exchange further proposes that the term ``Emergency Condition'' and related definition, described in current Rule 49(a)(1), (2), and (3)(A), would not be included in proposed Rule 49 because this language has been superseded by Regulation SCI Rule 1001(a)(2)(v).\19\ Likewise, the Exchange would not retain the current Rule 49(c)(2) requirement that the ability to invoke Rule 49(a) would be operative for only a ten-day period. The Exchange believes that, in the event of a wide-scale disruption, ten days may not be enough time. --------------------------------------------------------------------------- \19\ See 17 CFR 242.1001(a)(2)(v). --------------------------------------------------------------------------- In addition, the Exchange is not proposing to include the subject of current Rule 49(b)(2)(A) and (B) in proposed Rule 49. In the Exchange's proposed Disaster Recovery Facility, the Exchange would be reporting all quotes and trades to the SIP as quotes and trades of the Exchange. In addition, the Exchange would be disseminating regulatory messages for its listed securities, including notifications of a regulatory halt and resumption of trading thereafter, trading pause and resumption of trading thereafter, and Short Sale Price Test trigger and lifting thereafter. Accordingly, NYSE Arca would not be disseminating this information on behalf of the Exchange in the event it determines to trade Exchange-traded securities on its Disaster Recovery Facility. Finally, the Exchange does not propose to retain the language in current Rule 49(c)(1), regarding notification requirements to the Commission as these have also been superseded by the notification requirements in Regulation SCI.\20\ Accordingly, current Rule 49(c)(1) is obsolete and does not need to be included in proposed Rule 49(a). --------------------------------------------------------------------------- \20\ 17 CFR 242.1002(b)(1). --------------------------------------------------------------------------- As discussed above, proposed Rule 49(b)(N) would include all the text of current Rule 438, with non-substantive differences to update sub-paragraph numbering and rule paragraph cross references. The Exchange proposes to designate this paragraph of proposed Rule 49(b)(N) with an ``N'' to distinguish it from current Rule 49(b), as both would be operative at the same time. * * * * * As discussed above in footnote 3, paragraph (a) of proposed Rule 49(a) would not be operative until the Exchange has an opportunity to test it with Exchange member organizations. The Exchange does not anticipate that the DR Facility will be available for testing in production until late in the fourth quarter of 2016. The Exchange will file a separate proposed rule change to establish the operative date of paragraph (a) of proposed Rule 49, delete current ``Rule 49. Emergency Powers,'' delete the preamble to proposed Rule 49, and delete the ``N'' designation to proposed Rule 49(b). The operative date established in such separate proposed rule change will also be announced via Trader Update. The proposed changes to Rule 49(b)(N), 51, and Rule 438 will be operative on approval of this proposed rule change. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,\21\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\22\ in particular, because it is designed to promote just and equitable principles of trade and to remove impediments to and perfect the mechanism of a free and open market and a national market system, and in general, to protect investors and the public interest. Specifically, the Exchange believes that the proposed rule change will assist in facilitating trading in Exchange-traded securities in the event the Exchange experiences a disruption in its primary data center. Accordingly, the proposed rule change is designed to protect investors and the public interest by providing for minimal interruption of Exchange trading if the Exchange experiences a wide-scale disruption. The proposed rule change would therefore remove impediments to and perfect the mechanism of a free and open market and a national market system by providing for a business continuity and disaster recovery plan that includes maintaining backup and recovery capabilities sufficiently resilient and geographically diverse and that is reasonably designed to achieve next business day resumption of trading and two-hour resumption of critical Exchange systems following a wide-scale disruption, as required by Regulation SCI.\23\ Moreover, the Exchange believes that the proposed rule change would strengthen business continuity planning for itself and its member organizations, thereby benefiting market participants and investors generally. --------------------------------------------------------------------------- \21\ 15 U.S.C. 78f(b). \22\ 15 U.S.C. 78f(b)(5). \23\ See supra note 5. --------------------------------------------------------------------------- More specifically, the Exchange believes that the proposed rule change would remove impediments to and perfect the mechanism of a free and open market and a national market system because under the proposed disaster recovery plan, the Exchange would maintain its own facility within the Disaster Recovery Facility that would disseminate to the SIP all quote and trade information, including opening, reopening, and closing auction information and intra-day quotes and trades, as well as regulatory messages, as Exchange messages. The Exchange further believes that the proposed rule change to vest the authority to determine to trade securities on the Exchange's Disaster Recovery Facility pursuant to Rule 49 with the CEO, as provided for in proposed Rule 51(b)(v), would remove impediments to and perfect the mechanism of a free and open market and a national market system because it would consolidate in a single rule the individual with authority to take specified actions. This proposed rule change would also streamline the Exchange's rules and procedures by providing for consistent authority of who may act when there is a loss or interruption of facilities utilized by the Exchange. The Exchange also believes that, because the Exchange is now subject to the requirements of Regulation SCI, certain elements of current Rule 49 have been superseded, and therefore it would remove impediments to and perfect the mechanism of a free and open market and a national market system for proposed Rule 49(a) not to include specified provisions of the current rule. [[Page 53184]] Specifically, the Exchange does not believe that proposed Rule 49(a) needs to be limited to what is currently defined as an ``Emergency Condition'' or be invoked for only ten days because the proposed rule would be invoked as part of a robust business continuity and disaster recovery plan in the event of a wide-scale disruption, as required by Rule 1001(a)(2)(v) of Regulation SCI.\24\ For similar reasons, the Exchange does not believes that proposed Rule 49 needs separate provisions specifying notice requirements to the Commission because these are now required by Rule 1002(b) of Regulation SCI.\25\ --------------------------------------------------------------------------- \24\ 17 CFR 242.1001(a)(2)(v). \25\ 17 CFR 242.1002(b). --------------------------------------------------------------------------- Finally, the Exchange believes that moving the text of current Rule 438 to proposed Rule 49(b)(N), and renaming Rule 49 as ``Exchange Business Continuity and Disaster Recovery Plans and Mandatory Testing,'' would remove impediments to and perfect the mechanism of a free and open market and a national market system because it would consolidate into a single rule related content, i.e., the Exchange's proposed disaster recovery plan and mandatory testing requirements related to such plan. Thus, the proposed rule change would make the Exchange's rules easier to navigate for Exchange members, the Commission, and the public. 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. The proposed rule change is designed to facilitate trading in Exchange-listed securities on its Disaster Recovery Facility. As such, the Exchange believes that the proposed rule change would promote competition for the benefit of market participants and investors generally because it provides transparency in Exchange rules of which rules would govern trading in Exchange-traded securities if they trade on the Exchange's Disaster Recovery Facility. 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 Within 45 days of the date of publication of this notice in the Federal Register or 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 the 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 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-NYSE-2016-48 on the subject line. Paper Comments Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NYSE-2016-48. 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-NYSE-2016-48, and should be submitted on or before September 1, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\26\ --------------------------------------------------------------------------- \26\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Jill M. Peterson, Assistant Secretary. [FR Doc. 2016-19054 Filed 8-10-16; 8:45 am] BILLING CODE 8011-01-P
![53180 Federal Register / Vol. 81, No. 155 / Thursday, August 11, 2016 / Notices
C. Self-Regulatory Organization’s provisions of 5 U.S.C. 552, will be I. Self-Regulatory Organization’s
Statement on Comments on the available for Web site viewing and Statement of the Terms of Substance of
Proposed Rule Change Received From printing in the Commission’s Public the Proposed Rule Change
Members, Participants, or Others Reference Room, 100 F Street NE., The Exchange proposes to amend
No written comments were solicited Washington, DC 20549, on official NYSE Rule 49 (Emergency Powers) by
or received with respect to the proposed business days between the hours of (1) replacing the text of current Rule 49
rule change. 10:00 a.m. and 3:00 p.m. Copies of the with the Exchange’s proposed disaster
filing also will be available for recovery plans; and (2) moving the text
III. Date of Effectiveness of the inspection and copying at the principal of current Rule 438 (Exchange Backup
Proposed Rule Change and Timing for office of the Exchange. All comments Systems and Mandatory Testing) to Rule
Commission Action received will be posted without change; 49. This Amendment No. 1 supersedes
Within 45 days of the date of the Commission does not edit personal the original filing in its entirety. The
publication of this notice in the Federal identifying information from proposed rule change is available on the
Register or up to 90 days (i) as the submissions. You should submit only Exchange’s Web site at www.nyse.com,
Commission may designate if it finds information that you wish to make at the principal office of the Exchange,
such longer period to be appropriate available publicly. All submissions and at the Commission’s Public
and publishes its reasons for so finding should refer to File Number SR– Reference Room.
or (ii) as to which the self-regulatory NYSEMKT–2016–68, and should be
II. Self-Regulatory Organization’s
organization consents, the Commission submitted on or before September 1,
Statement of the Purpose of, and
will: 2016.
Statutory Basis for, the Proposed Rule
(A) By order approve or disapprove For the Commission, by the Division of Change
the proposed rule change, or Trading and Markets, pursuant to delegated
(B) institute proceedings to determine In its filing with the Commission, the
authority.26
whether the proposed rule change self-regulatory organization included
Jill M. Peterson, statements concerning the purpose of,
should be disapproved.
Assistant Secretary. and basis for, the proposed rule change
IV. Solicitation of Comments [FR Doc. 2016–19053 Filed 8–10–16; 8:45 am] and discussed any comments it received
Interested persons are invited to BILLING CODE 8011–01–P on the proposed rule change. The text
submit written data, views, and of those statements may be examined at
arguments concerning the foregoing, the places specified in Item IV below.
including whether the proposed rule SECURITIES AND EXCHANGE The Exchange has prepared summaries,
change is consistent with the Act. COMMISSION set forth in sections A, B, and C below,
Comments may be submitted by any of of the most significant parts of such
the following methods: [Release No. 34–78484; File No. SR–NYSE– statements.
Electronic Comments 2016–48] A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
• Use the Commission’s Internet Self-Regulatory Organizations; New Statutory Basis for, the Proposed Rule
comment form (http://www.sec.gov/ York Stock Exchange LLC; Notice of Change
rules/sro.shtml); or Filing of Proposed Rule Change, as
• Send an email to rule-comments@ Modified by Amendment No. 1, 1. Purpose
sec.gov. Please include File Number SR– Amending NYSE Rule 49 Regarding: The Exchange proposes to amend
NYSEMKT–2016–68 on the subject line. (1) The Exchange’s Emergency Rule 49, which addresses the
Paper Comments Powers; (2) the Exchange’s Disaster Exchange’s emergency powers, by (1)
Recovery Plans; and (3) Exchange replacing the text of current Rule 49
• Send paper comments in triplicate Backup Systems and Mandatory with the Exchange’s proposed disaster
to Brent J. Fields, Secretary, Securities Testing recovery plans; and (2) moving the text
and Exchange Commission, 100 F Street of current Rule 438 (Exchange Backup
NE., Washington, DC 20549–1090. August 5, 2016. Systems and Mandatory Testing) to Rule
All submissions should refer to File Pursuant to Section 19(b)(1) 1 of the 49 with no substantive changes.
Number SR–NYSEMKT–2016–68. This Securities Exchange Act of 1934 (the The Exchange proposes to amend
file number should be included on the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 Rule 49 in two ways. First, the Exchange
subject line if email is used. To help the notice is hereby given that, on July 29, proposes to replace the current disaster
Commission process and review your 2016, New York Stock Exchange LLC recovery plan, pursuant to which NYSE
comments more efficiently, please use (‘‘NYSE’’ or the ‘‘Exchange’’) filed with Arca, Inc. (‘‘NYSE Arca’’), the
only one method. The Commission will the Securities and Exchange Exchange’s affiliate, acts on behalf of
post all comments on the Commission’s Commission (the ‘‘Commission’’) the and at the direction of the Exchange for
Internet Web site (http://www.sec.gov/ proposed rule change as described in auctions and specified regulatory
rules/sro.shtml). Copies of the Items I, and II below, which Items have messages in Exchange-listed securities,
submission, all subsequent been prepared by the self-regulatory with a new disaster recovery plan that
amendments, all written statements organization. The Commission is the Exchange would implement if the
with respect to the proposed rule Exchange’s primary data center is
sradovich on DSK3GMQ082PROD with NOTICES
publishing this notice to solicit
change that are filed with the comments on the proposed rule change impaired. Under the proposed disaster
Commission, and all written from interested persons. recovery plan, the Exchange would no
communications relating to the longer rely on NYSE Arca to act on its
proposed rule change between the 26 17 CFR 200.30–3(a)(12). behalf. Rather, the Exchange would
Commission and any person, other than 1 15 U.S.C. 78s(b)(1). operate as a fully electronic exchange
those that may be withheld from the 2 15 U.S.C. 78a. under its own trading rules and would
public in accordance with the 3 17 CFR 240.19b–4. maintain its own order book in its
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![53184 Federal Register / Vol. 81, No. 155 / Thursday, August 11, 2016 / Notices
Specifically, the Exchange does not III. Date of Effectiveness of the inspection and copying at the principal
believe that proposed Rule 49(a) needs Proposed Rule Change and Timing for office of the Exchange. All comments
to be limited to what is currently Commission Action received will be posted without change;
defined as an ‘‘Emergency Condition’’ or Within 45 days of the date of the Commission does not edit personal
be invoked for only ten days because the publication of this notice in the Federal identifying information from
proposed rule would be invoked as part Register or up to 90 days (i) as the submissions. You should submit only
of a robust business continuity and Commission may designate if it finds information that you wish to make
disaster recovery plan in the event of a such longer period to be appropriate available publicly. All submissions
wide-scale disruption, as required by and publishes its reasons for so finding should refer to File Number SR–NYSE–
Rule 1001(a)(2)(v) of Regulation SCI.24 or (ii) as to which the self-regulatory 2016–48, and should be submitted on or
For similar reasons, the Exchange does organization consents, the Commission before September 1, 2016.
not believes that proposed Rule 49 will: For the Commission, by the Division of
needs separate provisions specifying (A) By order approve or disapprove Trading and Markets, pursuant to delegated
notice requirements to the Commission the proposed rule change, or authority.26
because these are now required by Rule (B) institute proceedings to determine Jill M. Peterson,
1002(b) of Regulation SCI.25 whether the proposed rule change Assistant Secretary.
Finally, the Exchange believes that should be disapproved. [FR Doc. 2016–19054 Filed 8–10–16; 8:45 am]
BILLING CODE 8011–01–P
moving the text of current Rule 438 to IV. Solicitation of Comments
proposed Rule 49(b)(N), and renaming Interested persons are invited to
Rule 49 as ‘‘Exchange Business submit written data, views, and SECURITIES AND EXCHANGE
Continuity and Disaster Recovery Plans arguments concerning the foregoing, COMMISSION
and Mandatory Testing,’’ would remove including whether the proposed rule
impediments to and perfect the [Release No. 34–78485; File No. SR–
change is consistent with the Act. NYSEArca–2016–115]
mechanism of a free and open market Comments may be submitted by any of
and a national market system because it the following methods: Self-Regulatory Organizations; NYSE
would consolidate into a single rule Arca, Inc.; Notice of Filing and
related content, i.e., the Exchange’s Electronic Comments
Immediate Effectiveness of Proposed
proposed disaster recovery plan and • Use the Commission’s Internet Rule Change To Amend the NYSE Arca
mandatory testing requirements related comment form (http://www.sec.gov/ Options Fee Schedule
to such plan. Thus, the proposed rule rules/sro.shtml); or
change would make the Exchange’s • Send an email to rule-comments@ August 5, 2016.
rules easier to navigate for Exchange sec.gov. Please include File Number SR– Pursuant to Section 19(b)(1) of the
members, the Commission, and the NYSE–2016–48 on the subject line. Securities Exchange Act of 1934
public. (‘‘Act’’),1 and Rule 19b–4 thereunder,2
Paper Comments notice is hereby given that, on August
B. Self-Regulatory Organization’s • Send paper comments in triplicate 1, 2016, NYSE Arca, Inc. (‘‘NYSE Arca’’
Statement on Burden on Competition to Brent J. Fields, Secretary, Securities or ‘‘Exchange’’) filed with the Securities
and Exchange Commission, 100 F Street and Exchange Commission (‘‘SEC’’ or
The Exchange does not believe that ‘‘Commission’’) the proposed rule
NE., Washington, DC 20549–1090.
the proposed rule change will impose change as described in Items I, II, and
any burden on competition that is not All submissions should refer to File
Number SR–NYSE–2016–48. This file III below, which Items have been
necessary or appropriate in furtherance prepared by the Exchange. The
of the purposes of the Act. The number should be included on the
subject line if email is used. To help the Commission is publishing this notice to
proposed rule change is designed to solicit comments on the proposed rule
facilitate trading in Exchange-listed Commission process and review your
comments more efficiently, please use change from interested persons.
securities on its Disaster Recovery
Facility. As such, the Exchange believes only one method. The Commission will I. Self-Regulatory Organization’s
that the proposed rule change would post all comments on the Commission’s Statement of the Terms of Substance of
Internet Web site (http://www.sec.gov/ the Proposed Rule Change
promote competition for the benefit of
rules/sro.shtml). Copies of the
market participants and investors The Exchange proposes to to amend
submission, all subsequent
generally because it provides the NYSE Arca Options Fee Schedule.
amendments, all written statements
transparency in Exchange rules of The proposed rule change is available
with respect to the proposed rule
which rules would govern trading in on the Exchange’s Web site at
change that are filed with the
Exchange-traded securities if they trade www.nyse.com, at the principal office of
Commission, and all written
on the Exchange’s Disaster Recovery the Exchange, and at the Commission’s
communications relating to the
Facility. Public Reference Room.
proposed rule change between the
C. Self-Regulatory Organization’s Commission and any person, other than II. Self-Regulatory Organization’s
Statement on Comments on the those that may be withheld from the Statement of the Purpose of, and
Proposed Rule Change Received From public in accordance with the Statutory Basis for, the Proposed Rule
provisions of 5 U.S.C. 552, will be Change
sradovich on DSK3GMQ082PROD with NOTICES
Members, Participants, or Others
available for Web site viewing and In its filing with the Commission, the
No written comments were solicited printing in the Commission’s Public self-regulatory organization included
or received with respect to the proposed Reference Room, 100 F Street NE., statements concerning the purpose of,
rule change. Washington, DC 20549, on official
business days between the hours of 26 17 CFR 200.30–3(a)(12).
24 17 CFR 242.1001(a)(2)(v). 10:00 a.m. and 3:00 p.m. Copies of the 1 15 U.S.C. 78s(b)(1).
25 17 CFR 242.1002(b). filing also will be available for 2 17 CFR 240.19b–4.
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Document Created: 2018-02-09 11:27:38
Document Modified: 2018-02-09 11:27:38
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
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