81_FR_9074 81 FR 9039 - Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the FLEX No Minimum Value Pilot

81 FR 9039 - Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the FLEX No Minimum Value Pilot

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 35 (February 23, 2016)

Page Range9039-9041
FR Document2016-03661

Federal Register, Volume 81 Issue 35 (Tuesday, February 23, 2016) 
[Federal Register Volume 81, Number 35 (Tuesday, February 23, 2016)]
[Notices]
[Pages 9039-9041]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-03661]



[[Page 9039]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77153; File No. SR-Phlx-2016-19]


Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Extend 
the FLEX No Minimum Value Pilot

February 17, 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 February 2, 2016, NASDAQ OMX PHLX LLC (``Phlx'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``SEC'' or 
``Commission'') the proposed rule change as described in Items I 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    The Exchange is filing with the Commission a proposal to amend Phlx 
Rule 1079 (FLEX Index, Equity and Currency Options) to extend a pilot 
program that eliminates minimum value sizes for opening transactions in 
new series of FLEX index options and FLEX equity options (together 
known as ``FLEX Options'').\3\
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    \3\ In addition to FLEX Options, FLEX currency options are also 
traded on the Exchange. These flexible index, equity, and currency 
options provide investors the ability to customize basic option 
features including size, expiration date, exercise style, and 
certain exercise prices, and may have expiration dates within five 
years. See Rule 1079. FLEX currency options traded on the Exchange 
are also known as FLEX FX Options. The pilot program discussed 
herein does not encompass FLEX currency options.
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    The text of the amended Exchange rule is set forth immediately 
below.
    Additions are in italics and deletions are [bracketed].

Rules of the Exchange

Options Rules

* * * * *

Rule 1079. FLEX Index, Equity and Currency Options

    A Requesting Member shall obtain quotes and execute trades in 
certain non-listed FLEX options at the specialist post of the non-
FLEX option on the Exchange. The term ``FLEX option'' means a FLEX 
option contract that is traded subject to this Rule. Although FLEX 
options are generally subject to the Rules in this section, to the 
extent that the provisions of this Rule are inconsistent with other 
applicable Exchange Rules, this Rule takes precedence with respect 
to FLEX options.
    (a)-(f) No Change.
       
Commentary:
    .01 Notwithstanding subparagraphs (a)(8)(A)(i) and (a)(8)(A)(ii) 
above, for a pilot period ending the earlier of [January 31] March 
15, 2016, or the date on which the pilot is approved on a permanent 
basis, there shall be no minimum value size requirements for FLEX 
options.
* * * * *
    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 purpose of this proposed rule change is to amend Phlx Rule 1079 
(FLEX Index, Equity and Currency Options) to extend a pilot program 
that eliminates minimum value sizes for opening transactions in new 
series of FLEX Options (the ``Pilot Program'' or ``Pilot''). The 
Exchange has submitted a separate filing for permanent approval of the 
Pilot Program; \4\ and is submitting this extension proposal so the 
Pilot Program continues while the Commission considers such permanent 
approval.
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    \4\ See Securities Exchange Act Release No. 76593 (December 8, 
2015), 80 FR 77399 (December 14, 2015) (SR-Phlx-2015-94) (notice of 
amended proposal to make the Pilot Program permanent) (the 
``permanent approval filing'').
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    Rule 1079 deals with the process of listing and trading FLEX 
equity, index, and currency options on the Exchange. Rule 1079(a)(8)(A) 
currently sets the minimum opening transaction value size in the case 
of a FLEX Option in a newly established (opening) series if there is no 
open interest in the particular series when a Request-for-Quote 
(``RFQ'') is submitted (except as provided in Commentary .01 to Rule 
1079): (i) $10 million underlying equivalent value, respecting FLEX 
market index options, and $5 million underlying equivalent value 
respecting FLEX industry index options; \5\ (ii) the lesser of 250 
contracts or the number of contracts overlying $1 million in the 
underlying securities, with respect to FLEX equity options (together 
the ``minimum value size'').\6\
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    \5\ Market index options and industry index options are broad-
based index options and narrow-based index options, respectively. 
See Rule 1000A(b)(11) and (12).
    \6\ Subsection (a)(8)(A) also provides a third alternative: 
(iii) 50 contracts in the case of FLEX currency options. However, 
this alternative is not part of the Pilot Program.
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    Presently, Commentary .01 to Rule 1079 states that by virtue of the 
Pilot Program ending January 31, 2016, or the date on which the pilot 
is approved on a permanent basis, there shall be no minimum value size 
requirements for FLEX Options as noted in subsections (a)(8)(A)(i) and 
(a)(8)(A)(ii) of Rule 1079.\7\
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    \7\ See Securities Exchange Act Release No. 75794 (August 31, 
2015), 80 FR 53606 (September 4, 2015) (SR-Phlx-2015-74) (notice of 
filing and immediate effectiveness of proposal to extend Pilot 
Program). The Pilot Program was instituted in 2010. See Securities 
Exchange Act Release No. 62900 (September 13, 2010), 75 FR 57098 
(September 17, 2010) (SR-Phlx-2010-123) (notice of filing and 
immediate effectiveness of proposal to institute Pilot Program).
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    The Exchange now proposes to extend the Pilot Program for a pilot 
period ending the earlier of March 15, 2016, or the date on which the 
Pilot is approved on a permanent basis.\8\
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    \8\ The Exchange notes that any positions established under this 
Pilot would not be impacted by the expiration of the Pilot. For 
example, a 10 contract FLEX equity option opening position that 
overlies less than $1 million in the underlying security and expires 
in January 2017 could be established during the Pilot. If the Pilot 
Program were not extended, the position would continue to exist and 
any further trading in the series would be subject to the minimum 
value size requirements for continued trading in that series.
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    The Exchange believes that there is sufficient investor interest 
and demand in the Pilot Program to warrant an extension. The Exchange 
believes that the Pilot Program has provided investors with additional 
means of managing their risk exposures and carrying out their 
investment objectives. Extension of the Pilot Program would continue to 
provide greater opportunities for traders and investors to manage risk 
through the use of FLEX Options, including investors that may otherwise 
trade in the unregulated over

[[Page 9040]]

the counter (``OTC'') market where similar size restrictions do not 
apply.\9\
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    \9\ The Exchange has not experienced any adverse market effects 
with respect to the Pilot Program.
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    In support of the proposed extension of the Pilot Program, the 
Exchange has under separate cover submitted to the Commission a Pilot 
Program Report (``Report'') that provides an analysis of the Pilot 
Program covering the period during which the Pilot has been in effect. 
This Report includes: (i) Data and analysis on the open interest and 
trading volume in (a) FLEX equity options that have an opening 
transaction with a minimum size of 0 to 249 contracts and less than $1 
million in underlying value; (b) FLEX index options that have an 
opening transaction with a minimum opening size of less than $10 
million in underlying equivalent value; and (ii) analysis of the types 
of investors that initiated opening FLEX Options transactions (i.e., 
institutional, high net worth, or retail). The Report has been 
submitted to the Commission as Exhibit 3 to the Exchange's permanent 
approval filing, and a subsequent Report with updated data, which the 
Exchange intends to make public, was also submitted to the Commission 
under separate cover.\10\
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    \10\ In the event the Pilot Program is not permanently approved 
by March 15, 2016, the Exchange will submit an additional Report 
covering the extended Pilot period.
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2. Statutory Basis
    The Exchange's proposal is consistent with Section 6(b) of the Act 
\11\ in general, and furthers the objectives of Section 6(b)(5) of the 
Act \12\ in particular, in that it is designed to prevent fraudulent 
and manipulative acts and practices, to promote just and equitable 
principles of trade, to foster cooperation and coordination with 
persons engaged in facilitating transactions in securities, and to 
remove impediments to and perfect the mechanisms of a free and open 
market and a national market system. Specifically, the Exchange 
believes that the proposed extension of the Pilot Program, which 
eliminates the minimum value size applicable to opening transactions in 
new series of FLEX Options, would provide greater opportunities for 
investors to manage risk through the use of FLEX Options. The Exchange 
notes that it has not experienced any adverse market effects with 
respect to the Pilot Program.
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    \11\ 15 U.S.C. 78f(b).
    \12\ 15 U.S.C. 78f(b)(5).
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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. To the contrary, the proposal 
would give traders and investors the opportunity to more effectively 
tailor their trading, investing and hedging through FLEX options traded 
on the Exchange. Prior to the Pilot, options that represented opening 
transactions in new series that could not meet a minimum value size 
could not trade via FLEX on the Exchange, but rather had to trade OTC. 
Extension of the Pilot enables such options to continue to trade on the 
Exchange.

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

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6) thereunder.\13\
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    \13\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \14\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\15\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the Exchange 
may seamlessly continue its Pilot Program. The Commission believes that 
waiving the 30-day operative delay is consistent with the protection of 
investors and the public interest.\16\ The Commission notes that 
waiving the 30-day operative delay would enable the Pilot Program to 
continue as of the date of the filing of this proposed rule change. 
Therefore, the Commission hereby waives the 30-day operative delay and 
designates the proposal operative upon filing.
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    \14\ 17 CFR 240.19b-4(f)(6).
    \15\ 17 CFR 240.19b-4(f)(6)(iii).
    \16\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic 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-Phlx-2016-19 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-2016-19. 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

[[Page 9041]]

public in accordance with the provisions of 5 U.S.C. 552, will be 
available for Web site viewing and printing in the Commission's Public 
Reference Room, 100 F Street NE., Washington, DC 20549 on official 
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of 
such filing also will be available for inspection and copying at the 
principal office of the Exchange. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-Phlx-2016-19, and should be submitted on or before March 
15, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\17\
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    \17\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-03661 Filed 2-22-16; 8:45 am]
 BILLING CODE 8011-01-P

Federal Register / Vol. 81, No. 35 / Tuesday, February 23, 2016 / Notices 9039 SECURITIES AND EXCHANGE of this Rule are inconsistent with other there is no open interest in the COMMISSION applicable Exchange Rules, this Rule takes particular series when a Request-for- precedence with respect to FLEX options. Quote (‘‘RFQ’’) is submitted (except as [Release No. 34–77153; File No. SR–Phlx– (a)–(f) No Change. 2016–19] • • • Commentary: provided in Commentary .01 to Rule .01 Notwithstanding subparagraphs 1079): (i) $10 million underlying Self-Regulatory Organizations; (a)(8)(A)(i) and (a)(8)(A)(ii) above, for a pilot equivalent value, respecting FLEX NASDAQ OMX PHLX LLC; Notice of period ending the earlier of [January 31] market index options, and $5 million Filing and Immediate Effectiveness of March 15, 2016, or the date on which the underlying equivalent value respecting Proposed Rule Change To Extend the pilot is approved on a permanent basis, there FLEX industry index options; 5 (ii) the FLEX No Minimum Value Pilot shall be no minimum value size requirements lesser of 250 contracts or the number of for FLEX options. contracts overlying $1 million in the February 17, 2016. * * * * * underlying securities, with respect to Pursuant to Section 19(b)(1) of the The text of the proposed rule change FLEX equity options (together the Securities Exchange Act of 1934 is available on the Exchange’s Web site ‘‘minimum value size’’).6 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 at http:// notice is hereby given that on February nasdaqomxphlx.cchwallstreet.com, at Presently, Commentary .01 to Rule 2, 2016, NASDAQ OMX PHLX LLC the principal office of the Exchange, and 1079 states that by virtue of the Pilot (‘‘Phlx’’ or ‘‘Exchange’’) filed with the at the Commission’s Public Reference Program ending January 31, 2016, or the Securities and Exchange Commission Room. date on which the pilot is approved on (‘‘SEC’’ or ‘‘Commission’’) the proposed a permanent basis, there shall be no rule change as described in Items I and II. Self-Regulatory Organization’s minimum value size requirements for II below, which Items have been Statement of the Purpose of, and FLEX Options as noted in subsections prepared by the Exchange. The Statutory Basis for, the Proposed Rule (a)(8)(A)(i) and (a)(8)(A)(ii) of Rule Commission is publishing this notice to Change 1079.7 solicit comments on the proposed rule In its filing with the Commission, the The Exchange now proposes to extend change from interested persons. Exchange included statements the Pilot Program for a pilot period concerning the purpose of and basis for ending the earlier of March 15, 2016, or I. Self-Regulatory Organization’s the proposed rule change and discussed the date on which the Pilot is approved Statement of the Terms of the Substance any comments it received on the on a permanent basis.8 of the Proposed Rule Change proposed rule change. The text of these The Exchange is filing with the The Exchange believes that there is statements may be examined at the Commission a proposal to amend Phlx sufficient investor interest and demand places specified in Item IV below. The Rule 1079 (FLEX Index, Equity and in the Pilot Program to warrant an Exchange has prepared summaries, set Currency Options) to extend a pilot extension. The Exchange believes that forth in sections A, B, and C below, of program that eliminates minimum value the Pilot Program has provided the most significant aspects of such sizes for opening transactions in new statements. investors with additional means of series of FLEX index options and FLEX managing their risk exposures and equity options (together known as A. Self-Regulatory Organization’s carrying out their investment objectives. ‘‘FLEX Options’’).3 Statement of the Purpose of, and Extension of the Pilot Program would The text of the amended Exchange Statutory Basis for, the Proposed Rule continue to provide greater rule is set forth immediately below. Change opportunities for traders and investors Additions are in italics and deletions 1. Purpose to manage risk through the use of FLEX are [bracketed]. Options, including investors that may The purpose of this proposed rule otherwise trade in the unregulated over Rules of the Exchange change is to amend Phlx Rule 1079 (FLEX Index, Equity and Currency 5 Market index options and industry index Options Rules Options) to extend a pilot program that options are broad-based index options and narrow- * * * * * eliminates minimum value sizes for based index options, respectively. See Rule Rule 1079. FLEX Index, Equity and Currency opening transactions in new series of 1000A(b)(11) and (12). 6 Subsection (a)(8)(A) also provides a third Options FLEX Options (the ‘‘Pilot Program’’ or alternative: (iii) 50 contracts in the case of FLEX A Requesting Member shall obtain quotes ‘‘Pilot’’). The Exchange has submitted a currency options. However, this alternative is not and execute trades in certain non-listed FLEX separate filing for permanent approval part of the Pilot Program. options at the specialist post of the non-FLEX of the Pilot Program; 4 and is submitting 7 See Securities Exchange Act Release No. 75794 option on the Exchange. The term ‘‘FLEX this extension proposal so the Pilot (August 31, 2015), 80 FR 53606 (September 4, 2015) option’’ means a FLEX option contract that (SR–Phlx–2015–74) (notice of filing and immediate Program continues while the effectiveness of proposal to extend Pilot Program). is traded subject to this Rule. Although FLEX options are generally subject to the Rules in Commission considers such permanent The Pilot Program was instituted in 2010. See this section, to the extent that the provisions approval. Securities Exchange Act Release No. 62900 Rule 1079 deals with the process of (September 13, 2010), 75 FR 57098 (September 17, 2010) (SR–Phlx–2010–123) (notice of filing and 1 15U.S.C. 78s(b)(1). listing and trading FLEX equity, index, immediate effectiveness of proposal to institute 2 17CFR 240.19b–4. and currency options on the Exchange. Pilot Program). 3 In addition to FLEX Options, FLEX currency Rule 1079(a)(8)(A) currently sets the 8 The Exchange notes that any positions options are also traded on the Exchange. These minimum opening transaction value established under this Pilot would not be impacted mstockstill on DSK4VPTVN1PROD with NOTICES flexible index, equity, and currency options provide size in the case of a FLEX Option in a by the expiration of the Pilot. For example, a 10 investors the ability to customize basic option contract FLEX equity option opening position that features including size, expiration date, exercise newly established (opening) series if overlies less than $1 million in the underlying style, and certain exercise prices, and may have security and expires in January 2017 could be expiration dates within five years. See Rule 1079. 4 See Securities Exchange Act Release No. 76593 established during the Pilot. If the Pilot Program FLEX currency options traded on the Exchange are (December 8, 2015), 80 FR 77399 (December 14, were not extended, the position would continue to also known as FLEX FX Options. The pilot program 2015) (SR–Phlx–2015–94) (notice of amended exist and any further trading in the series would be discussed herein does not encompass FLEX proposal to make the Pilot Program permanent) (the subject to the minimum value size requirements for currency options. ‘‘permanent approval filing’’). continued trading in that series. VerDate Sep<11>2014 18:28 Feb 22, 2016 Jkt 238001 PO 00000 Frm 00145 Fmt 4703 Sfmt 4703 E:\FR\FM\23FEN1.SGM 23FEN1

9040 Federal Register / Vol. 81, No. 35 / Tuesday, February 23, 2016 / Notices the counter (‘‘OTC’’) market where B. Self-Regulatory Organization’s investors and the public interest.16 The similar size restrictions do not apply.9 Statement on Burden on Competition Commission notes that waiving the 30- In support of the proposed extension day operative delay would enable the The Exchange does not believe that Pilot Program to continue as of the date of the Pilot Program, the Exchange has the proposed rule change will impose under separate cover submitted to the of the filing of this proposed rule any burden on competition not change. Therefore, the Commission Commission a Pilot Program Report necessary or appropriate in furtherance hereby waives the 30-day operative (‘‘Report’’) that provides an analysis of of the purposes of the Act. To the delay and designates the proposal the Pilot Program covering the period contrary, the proposal would give operative upon filing. during which the Pilot has been in traders and investors the opportunity to At any time within 60 days of the effect. This Report includes: (i) Data and more effectively tailor their trading, filing of the proposed rule change, the analysis on the open interest and investing and hedging through FLEX Commission summarily may trading volume in (a) FLEX equity options traded on the Exchange. Prior to temporarily suspend such rule change if options that have an opening the Pilot, options that represented it appears to the Commission that such transaction with a minimum size of 0 to opening transactions in new series that action is necessary or appropriate in the 249 contracts and less than $1 million could not meet a minimum value size public interest, for the protection of in underlying value; (b) FLEX index could not trade via FLEX on the investors, or otherwise in furtherance of options that have an opening Exchange, but rather had to trade OTC. the purposes of the Act. If the transaction with a minimum opening Extension of the Pilot enables such Commission takes such action, the size of less than $10 million in options to continue to trade on the Commission shall institute proceedings underlying equivalent value; and (ii) Exchange. to determine whether the proposed rule analysis of the types of investors that C. Self-Regulatory Organization’s should be approved or disapproved. initiated opening FLEX Options Statement on Comments on the transactions (i.e., institutional, high net IV. Solicitation of Comments Proposed Rule Change Received From worth, or retail). The Report has been Members, Participants, or Others Interested persons are invited to submitted to the Commission as Exhibit submit written data, views, and 3 to the Exchange’s permanent approval No written comments were either arguments concerning the foregoing, filing, and a subsequent Report with solicited or received. including whether the proposed rule updated data, which the Exchange III. Date of Effectiveness of the change is consistent with the Act. intends to make public, was also Proposed Rule Change and Timing for Comments may be submitted by any of submitted to the Commission under Commission Action the following methods: separate cover.10 Electronic Comments Because the foregoing proposed rule 2. Statutory Basis change does not: (i) Significantly affect • Use the Commission’s Internet the protection of investors or the public comment form (http://www.sec.gov/ The Exchange’s proposal is consistent interest; (ii) impose any significant rules/sro.shtml); or with Section 6(b) of the Act 11 in burden on competition; and (iii) become • Send an email to rule-comments@ general, and furthers the objectives of operative for 30 days from the date on sec.gov. Please include File Number SR– Section 6(b)(5) of the Act 12 in which it was filed, or such shorter time Phlx–2016–19 on the subject line. particular, in that it is designed to as the Commission may designate, it has prevent fraudulent and manipulative become effective pursuant to Section Paper Comments acts and practices, to promote just and 19(b)(3)(A) of the Act and Rule 19b– • Send paper comments in triplicate equitable principles of trade, to foster 4(f)(6) thereunder.13 to Secretary, Securities and Exchange cooperation and coordination with A proposed rule change filed under Commission, 100 F Street NE., persons engaged in facilitating Rule 19b–4(f)(6) 14 normally does not Washington, DC 20549–1090. transactions in securities, and to remove become operative prior to 30 days after All submissions should refer to File impediments to and perfect the the date of the filing. However, pursuant Number SR–Phlx–2016–19. This file mechanisms of a free and open market to Rule 19b–4(f)(6)(iii),15 the number should be included on the and a national market system. Commission may designate a shorter subject line if email is used. To help the Specifically, the Exchange believes that time if such action is consistent with the Commission process and review your the proposed extension of the Pilot protection of investors and the public comments more efficiently, please use Program, which eliminates the interest. The Exchange has asked the only one method. The Commission will minimum value size applicable to Commission to waive the 30-day post all comments on the Commission’s opening transactions in new series of operative delay so that the Exchange Internet Web site (http://www.sec.gov/ FLEX Options, would provide greater may seamlessly continue its Pilot rules/sro.shtml). Copies of the opportunities for investors to manage Program. The Commission believes that submission, all subsequent risk through the use of FLEX Options. waiving the 30-day operative delay is amendments, all written statements The Exchange notes that it has not consistent with the protection of with respect to the proposed rule experienced any adverse market effects change that are filed with the with respect to the Pilot Program. 13 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– Commission, and all written 4(f)(6)(iii) requires a self-regulatory organization to communications relating to the mstockstill on DSK4VPTVN1PROD with NOTICES give the Commission written notice of its intent to proposed rule change between the 9 The Exchange has not experienced any adverse file the proposed rule change, along with a brief market effects with respect to the Pilot Program. description and text of the proposed rule change, Commission and any person, other than 10 In the event the Pilot Program is not at least five business days prior to the date of filing those that may be withheld from the permanently approved by March 15, 2016, the of the proposed rule change, or such shorter time Exchange will submit an additional Report covering as designated by the Commission. The Exchange 16 For purposes only of waiving the 30-day the extended Pilot period. has satisfied this requirement. operative delay, the Commission has considered the 11 15 U.S.C. 78f(b). 14 17 CFR 240.19b–4(f)(6). proposed rule’s impact on efficiency, competition, 12 15 U.S.C. 78f(b)(5). 15 17 CFR 240.19b–4(f)(6)(iii). and capital formation. See 15 U.S.C. 78c(f). VerDate Sep<11>2014 17:06 Feb 22, 2016 Jkt 238001 PO 00000 Frm 00146 Fmt 4703 Sfmt 4703 E:\FR\FM\23FEN1.SGM 23FEN1

Federal Register / Vol. 81, No. 35 / Tuesday, February 23, 2016 / Notices 9041 public in accordance with the change, or within such longer period up BSECC, SCCP, BX, and NASDAQ, the provisions of 5 U.S.C. 552, will be to 90 days as the Commission may ‘‘SROs’’), filed with the Securities and available for Web site viewing and designate if it finds such longer period Exchange Commission (‘‘Commission’’), printing in the Commission’s Public to be appropriate and publishes its pursuant to Section 19(b)(1) of the Reference Room, 100 F Street NE., reasons for so finding, or as to which the Securities Exchange Act of 1934 Washington, DC 20549 on official self-regulatory organization consents, (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 business days between the hours of the Commission shall either approve the proposed rule changes with respect to 10:00 a.m. and 3:00 p.m. Copies of such proposed rule change, disapprove the the By-Laws (‘‘By-Laws’’) of NASDAQ, filing also will be available for proposed rule change, or institute Inc. (‘‘Company’’), the parent company inspection and copying at the principal proceedings to determine whether the of the SROs. The proposed rule changes office of the Exchange. All comments proposed rule change should be would revise certain requirements received will be posted without change; disapproved. The 45th day after regarding Director 3 qualifications and the Commission does not edit personal publication of the notice for this Director disqualification procedures for identifying information from proposed rule change is February 18, the Company’s Board of Directors submissions. You should submit only 2016. The Commission is extending this (‘‘Board’’). On December 29, 2015, each information that you wish to make 45-day time period. SRO filed Amendment No. 1 to its available publicly. All submissions The Commission finds it appropriate respective proposal.4 On December 30, should refer to File Number SR–Phlx– to designate a longer period within 2015, Phlx filed Amendment No. 2 to its 2016–19, and should be submitted on or which to take action on the proposed proposal.5 The proposed rule changes, before March 15, 2016. rule change so that it has sufficient time as modified by the amendments thereto, For the Commission, by the Division of to consider this proposed rule change. were published for comment in the Trading and Markets, pursuant to delegated Accordingly, the Commission, pursuant Federal Register on January 7, 2016.6 authority.17 to Section 19(b)(2) of the Act,5 The Commission did not receive any Robert W. Errett, designates April 1, 2016, as the date by comment letters on the proposals. This Deputy Secretary. which the Commission shall either order approves the proposed rule [FR Doc. 2016–03661 Filed 2–22–16; 8:45 am] approve or disapprove, or institute changes, as modified by the respective proceedings to determine whether to amendments thereto. BILLING CODE 8011–01–P disapprove, the proposed rule change (File No. SR–BATS–2015–105). II. Description of the Proposal SECURITIES AND EXCHANGE For the Commission, by the Division of The Company proposes to amend COMMISSION Trading and Markets, pursuant to delegated authority.6 certain provisions of the By-Laws that [Release No. 34–77159; File No. SR–BATS– relate to the qualification of Directors. Robert W. Errett, 2015–105] First, the Company proposes to Deputy Secretary. Self-Regulatory Organizations; BATS [FR Doc. 2016–03666 Filed 2–22–16; 8:45 am] amend Section 4.3 of the By-Laws Exchange, Inc.; Notice of Designation BILLING CODE 8011–01–P (Qualifications), which sets forth the of a Longer Period for Commission compositional requirements of the Action on Proposed Rule Change to Board. Currently, Section 4.3 requires Rule 14.11(i), Managed Fund Shares, SECURITIES AND EXCHANGE that the number of Non-Industry To List and Trade the Shares of the COMMISSION Directors 7 on the Board equal or exceed Elkhorn S&P GSCI Dynamic Roll [Release No. 34–77165; File Nos. SR– 1 15 U.S.C. 78s(b)(1). Commodity ETF of Elkhorn ETF Trust BSECC–2015–002; SR–SCCP–2015–02; SR– 2 17 CFR 240.19b–4. BX–2015–085; SR–NASDAQ–2015–160; SR– 3 ‘‘Director’’ means a member of the Company’s February 17, 2016. Phlx–2015–113] On December 18, 2015, BATS Board of Directors. See Article I(j) of the By-Laws. 4 Amendment No. 1 for each of the proposals Exchange, Inc. (‘‘BATS’’) filed with the Self-Regulatory Organizations; Boston amended and replaced the original filing in its Securities and Exchange Commission Stock Exchange Clearing Corporation; entirety. In Amendment No. 1, each SRO, among (‘‘Commission’’), pursuant to Section Stock Clearing Corporation of other things, clarified the operation of the current 19(b)(1) of the Securities Exchange Act Philadelphia; NASDAQ OMX BX, Inc.; and proposed provisions of the By-Laws and how the proposed rule change would operate in of 1934 (‘‘Act’’) 1 and Rule 19b–4 The NASDAQ Stock Market LLC; conjunction with the Listing Rules (as herein thereunder,2 a proposed rule change to NASDAQ OMX PHLX LLC; Order defined) of NASDAQ. list and trade the shares of the Elkhorn Approving Proposed Rule Changes, as 5 On December 30, 2015, Phlx withdrew S&P GSCI Dynamic Roll Commodity Modified by Amendments Thereto, To Amendment No. 1 for technical reasons and, ETF of Elkhorn ETF Trust under BATS subsequently, filed Amendment No. 2. Amendment Amend the By-Laws of NASDAQ, Inc. No. 2 amended and replaced the original filing in Rule 14.11(i). The proposed rule change its entirety. was published for comment in the February 17, 2016. 6 Securities Exchange Act Release Nos. 76806 Federal Register on January 4, 2016.3 I. Introduction (December 31, 2015), 81 FR 838 (SR–BSCC–2015– The Commission has not received any 002); 76807 (December 31, 2015), 81 FR 828 (SR– On December 21, 2015, each of the SCCP–2015–02); 76808 (December 31, 2015), 81 FR comments on the proposal. Boston Stock Exchange Clearing 831 (SR–BX–2015–085); 76809 (December 31, Section 19(b)(2) of the Act 4 provides 2015), 81 FR 817 (SR–NASDAQ–2015–160); 76810 Corporation (‘‘BSECC’’), Stock Clearing that within 45 days of the publication of (December 31, 2015), 81 FR 841 (SR–Phlx–2015– mstockstill on DSK4VPTVN1PROD with NOTICES Corporation of Philadelphia (‘‘SCCP’’), 113) (collectively, ‘‘Notices’’). notice of the filing of a proposed rule NASDAQ OMX BX, Inc. (‘‘BX’’), The 7 Under the By-Laws, ‘‘Non-Industry Director’’ or 17 17 CFR 200.30–3(a)(12). NASDAQ Stock Market LLC ‘‘Non-Industry committee member’’ means a 1 15 (‘‘NASDAQ’’), and NASDAQ OMX Director (excluding any Staff Director) or committee U.S.C. 78s(b)(1). member who is (1) a Public Director or Public 2 17 CFR 240.19b–4. PHLX LLC (‘‘Phlx’’ and, together with committee member; (2) an Issuer Director or Issuer 3 See Securities Exchange Act Release No. 76776 committee member; or (3) any other individual who (Dec. 28, 2015), 80 FR 120. 5 Id. would not be an Industry Director or Industry 4 15 U.S.C. 78s(b)(2). 6 17 CFR 200.30–3(a)(31). committee member. See Article I(q) of the By-Laws. VerDate Sep<11>2014 17:06 Feb 22, 2016 Jkt 238001 PO 00000 Frm 00147 Fmt 4703 Sfmt 4703 E:\FR\FM\23FEN1.SGM 23FEN1


Document Created: 2018-02-02 14:33:10
Document Modified: 2018-02-02 14:33:10
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation81 FR 9039 
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