81 FR 9556 - Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 11.13(b)(3)(H), Order Execution and Routing, To Amend the Operation of Non-Displayed Orders and Reserve Orders

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 37 (February 25, 2016)

Page Range		9556-9557
FR Document		2016-03947
Federal Register, Volume 81 Issue 37 (Thursday, February 25, 2016)
[Federal Register Volume 81, Number 37 (Thursday, February 25, 2016)]
[Notices]
[Pages 9556-9557]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-03947]



[[Page 9556]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77187; File No. SR-BYX-2016-04]


Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 
11.13(b)(3)(H), Order Execution and Routing, To Amend the Operation of 
Non-Displayed Orders and Reserve Orders

February 19, 2016.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on February 10, 2016, BATS Y-Exchange, Inc. (the ``Exchange'' or 
``BYX'') 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 Exchange. The Exchange has 
designated this proposal as a ``non-controversial'' proposed rule 
change pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-
4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with 
the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6)(iii).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend the operation of Non-
Displayed Orders \5\ and Reserve Orders \6\ when they are to be routed 
away from the Exchange pursuant to the Post to Away routing option set 
forth in Rule 11.13(b)(3)(H).
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    \5\ See Exchange Rule 11.9(c)(11).
    \6\ See Exchange Rule 11.9(c)(1).
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    The text of the proposed rule change is available at the Exchange's 
Web site at www.batstrading.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 parts of such 
statements.

(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    A Non-Displayed Order is an order that is not displayed on the 
Exchange.\7\ A Reserve Order is a limit order with a portion of the 
quantity displayed (``Display Quantity'') and with a reserve portion of 
the quantity (``Reserve Quantity'') that is not displayed.\8\ Both the 
Display Quantity and the Reserve Quantity are available for execution 
against incoming orders. Under the Post to Away routing option, the 
remainder of an order that was previously routed away and returned to 
the Exchange may be re-routed to and post on the order book of a 
destination on the System routing table \9\ as specified by the 
User.\10\
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    \7\ See Exchange Rule 11.9(c)(11).
    \8\ See Exchange Rule 11.9(c)(1).
    \9\ The term ``System routing table'' refers to the proprietary 
process for determining the specific trading venues to which the 
System routes orders and the order in which it routes them. See 
Exchange Rule 11.13(b)(3).
    \10\ See Exchange Rule 11.13(b)(3)(H). The Post to Away routing 
option can be combined with the following routing options: ROUT, 
ROUX, ROUZ, INET, RDOT, RDOX, IOCM and ICMT. Id. An order subject to 
the ROUT, ROUX, ROUZ, INET, RDOT, RDOX, IOCM and ICMT routing 
options will not be posted to the order book of the Trading Center 
to which it is routed. The User may elect that the order be 
cancelled or post to the BATS Book [sic] upon its initial return to 
the Exchange. Id. Alternatively, if the User had selected the Post 
to Away routing option, the order would be currently routed to the 
away Trading Center as a Displayed Order.
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    Currently, Non-Displayed Orders and Reserve Orders that are routed 
to an away Trading Center pursuant to the Post to Away routing option 
are routed as fully displayed orders. The Exchange proposes to identify 
Non-Displayed Orders and Reserve Orders as such when routed to an away 
Trading Center. The Exchange believes doing so is consistent with the 
original intent of the order, to be not displayed or to include a 
Reserve Quantity.\11\
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    \11\ Routable Non-Displayed and Reserve Orders would be handled 
in accordance with the rules of the Trading Center to which they are 
routed.
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    The Exchange, therefore, proposes to amend the definition of Non-
Displayed Orders under Exchange Rule 11.9(c)(11) to state that a Non-
Displayed Order that is to be re-routed pursuant to the Post to Away 
routing option set forth in Rule 11.13(b)(3)(H) will be identified as a 
Non-Displayed Order when routed to an away Trading Center. Similarly, 
the Exchange proposes to amend the definition of a Reserve Order under 
Exchange Rule 11.9(c)(1) to state that a Reserve Order that is to be 
re-routed pursuant to the Post to Away routing option set forth in Rule 
11.13(b)(3)(H) will be identified as a Reserve Order when routed to an 
away Trading Center.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\12\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act,\13\ in particular, in that it 
is designed to prevent fraudulent and manipulative acts and practices, 
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. The proposal promotes just and equitable 
principles of trade by enabling Members to continue to identify their 
order as a Non-Displayed Order or Reserve Order when they are routed to 
an away Trading Center. The proposal also removes impediments to and 
perfects the mechanism of a free and open market and a national market 
system by providing Users the flexibility with regard to the handling 
of their orders by ensuring that the order is not altered and retains 
its original instructions from order entry when it is routed to an away 
Trading Center. Doing so ensures that such orders that are routed 
pursuant to the Post to Away routing option may be posted to the away 
Trading Center's order book consistent with the order's original 
instructions.
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    \12\ 15 U.S.C. 78f.
    \13\ 15 U.S.C. 78f(b)(5).
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(B) Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange believes its proposed rule change would not impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange believes the 
proposal would enhance competition by attracting additional order flow 
to the Exchange because it allows Users to ensure that their order is 
not altered and retains its original instructions from order entry when 
it is routed to an away Trading Center.

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

    The Exchange has not solicited, and does not intend to solicit, 
comments on

[[Page 9557]]

this proposed rule change. The Exchange has not received any 
unsolicited written comments from Members or other interested parties.

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

    Because the foregoing proposed rule change does not: (A) 
Significantly affect the protection of investors or the public 
interest; (B) impose any significant burden on competition; and (C) 
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 \14\ and paragraph 
(f)(6) of Rule 19b-4 thereunder.\15\ The Exchange has given 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.
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    \14\ 15 U.S.C. 78s(b)(3)(A).
    \15\ 17 CFR 240.19b-4.
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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: (1) 
Necessary or appropriate in the public interest; (2) for the protection 
of investors; or (3) 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 proposal 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-BYX-2016-04 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-BYX-2016-04. 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 such filing will also 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 No. SR-BYX-2016-04 and should be 
submitted on or before March 17, 2016.


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2016-03947 Filed 2-24-16; 8:45 am]
 BILLING CODE 8011-01-P
9556 Federal Register / Vol. 81, No. 37 / Thursday, February 25, 2016 / Notices

SECURITIES AND EXCHANGE places specified in Item IV below. The away Trading Center. Similarly, the
COMMISSION Exchange has prepared summaries, set Exchange proposes to amend the
forth in Sections A, B, and C below, of definition of a Reserve Order under
[Release No. 34–77187; File No. SR–BYX–
the most significant parts of such Exchange Rule 11.9(c)(1) to state that a
2016–04]
statements. Reserve Order that is to be re-routed
Self-Regulatory Organizations; BATS pursuant to the Post to Away routing
(A) Self-Regulatory Organization’s
Y-Exchange, Inc.; Notice of Filing and option set forth in Rule 11.13(b)(3)(H)
Statement of the Purpose of, and
Immediate Effectiveness of a Proposed will be identified as a Reserve Order
Statutory Basis for, the Proposed Rule
Rule Change to Rule 11.13(b)(3)(H), when routed to an away Trading Center.
Change
Order Execution and Routing, To 2. Statutory Basis
Amend the Operation of Non-Displayed 1. Purpose
The Exchange believes that the
Orders and Reserve Orders A Non-Displayed Order is an order proposed rule change is consistent with
that is not displayed on the Exchange.7 Section 6(b) of the Act,12 in general, and
February 19, 2016.
A Reserve Order is a limit order with a furthers the objectives of Section 6(b)(5)
Pursuant to Section 19(b)(1) of the portion of the quantity displayed
Securities Exchange Act of 1934 (the of the Act,13 in particular, in that it is
(‘‘Display Quantity’’) and with a reserve designed to prevent fraudulent and
‘‘Act’’),1 and Rule 19b–4 thereunder,2 portion of the quantity (‘‘Reserve
notice is hereby given that on February manipulative acts and practices, to
Quantity’’) that is not displayed.8 Both promote just and equitable principles of
10, 2016, BATS Y-Exchange, Inc. (the the Display Quantity and the Reserve
‘‘Exchange’’ or ‘‘BYX’’) filed with the trade, and to remove impediments to
Quantity are available for execution and perfect the mechanism of a free and
Securities and Exchange Commission against incoming orders. Under the Post
(the ‘‘Commission’’) the proposed rule open market and a national market
to Away routing option, the remainder system. The proposal promotes just and
change as described in Items I and II of an order that was previously routed
below, which Items have been prepared equitable principles of trade by enabling
away and returned to the Exchange may Members to continue to identify their
by the Exchange. The Exchange has be re-routed to and post on the order
designated this proposal as a ‘‘non- order as a Non-Displayed Order or
book of a destination on the System Reserve Order when they are routed to
controversial’’ proposed rule change routing table 9 as specified by the
pursuant to Section 19(b)(3)(A) of the an away Trading Center. The proposal
User.10 also removes impediments to and
Act 3 and Rule 19b–4(f)(6)(iii) Currently, Non-Displayed Orders and
thereunder,4 which renders it effective perfects the mechanism of a free and
Reserve Orders that are routed to an open market and a national market
upon filing with the Commission. The away Trading Center pursuant to the
Commission is publishing this notice to system by providing Users the flexibility
Post to Away routing option are routed with regard to the handling of their
solicit comments on the proposed rule as fully displayed orders. The Exchange
change from interested persons. orders by ensuring that the order is not
proposes to identify Non-Displayed altered and retains its original
I. Self-Regulatory Organization’s Orders and Reserve Orders as such instructions from order entry when it is
Statement of the Terms of Substance of when routed to an away Trading Center. routed to an away Trading Center. Doing
the Proposed Rule Change The Exchange believes doing so is so ensures that such orders that are
consistent with the original intent of the routed pursuant to the Post to Away
The Exchange filed a proposal to order, to be not displayed or to include
amend the operation of Non-Displayed routing option may be posted to the
a Reserve Quantity.11 away Trading Center’s order book
Orders 5 and Reserve Orders 6 when they The Exchange, therefore, proposes to
are to be routed away from the Exchange consistent with the order’s original
amend the definition of Non-Displayed
pursuant to the Post to Away routing instructions.
Orders under Exchange Rule 11.9(c)(11)
option set forth in Rule 11.13(b)(3)(H). to state that a Non-Displayed Order that (B) Self-Regulatory Organization’s
The text of the proposed rule change is to be re-routed pursuant to the Post Statement on Burden on Competition
is available at the Exchange’s Web site to Away routing option set forth in Rule
at www.batstrading.com, at the The Exchange believes its proposed
11.13(b)(3)(H) will be identified as a rule change would not impose any
principal office of the Exchange, and at Non-Displayed Order when routed to an
the Commission’s Public Reference burden on competition that is not
Room. necessary or appropriate in furtherance
7 See Exchange Rule 11.9(c)(11).
8 See
of the purposes of the Act. The
II. Self-Regulatory Organization’s Exchange Rule 11.9(c)(1).
9 The term ‘‘System routing table’’ refers to the
Exchange believes the proposal would
Statement of the Purpose of, and proprietary process for determining the specific enhance competition by attracting
Statutory Basis for, the Proposed Rule trading venues to which the System routes orders additional order flow to the Exchange
Change and the order in which it routes them. See because it allows Users to ensure that
Exchange Rule 11.13(b)(3).
In its filing with the Commission, the 10 See Exchange Rule 11.13(b)(3)(H). The Post to
their order is not altered and retains its
Exchange included statements Away routing option can be combined with the original instructions from order entry
concerning the purpose of and basis for following routing options: ROUT, ROUX, ROUZ, when it is routed to an away Trading
the proposed rule change and discussed INET, RDOT, RDOX, IOCM and ICMT. Id. An order Center.
subject to the ROUT, ROUX, ROUZ, INET, RDOT,
any comments it received on the RDOX, IOCM and ICMT routing options will not be (C) Self-Regulatory Organization’s
proposed rule change. The text of these posted to the order book of the Trading Center to Statement on Comments on the
mstockstill on DSK4VPTVN1PROD with NOTICES

statements may be examined at the which it is routed. The User may elect that the order Proposed Rule Change Received From
be cancelled or post to the BATS Book [sic] upon
its initial return to the Exchange. Id. Alternatively, Members, Participants or Others
1 15 U.S.C. 78s(b)(1).
2 17
if the User had selected the Post to Away routing The Exchange has not solicited, and
CFR 240.19b–4. option, the order would be currently routed to the
3 15 U.S.C. 78s(b)(3)(A).
away Trading Center as a Displayed Order. does not intend to solicit, comments on
4 17 CFR 240.19b–4(f)(6)(iii). 11 Routable Non-Displayed and Reserve Orders
5 See Exchange Rule 11.9(c)(11). 12 15 U.S.C. 78f.
would be handled in accordance with the rules of
6 See Exchange Rule 11.9(c)(1). the Trading Center to which they are routed. 13 15 U.S.C. 78f(b)(5).

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Federal Register / Vol. 81, No. 37 / Thursday, February 25, 2016 / Notices 9557

this proposed rule change. The number should be included on the ‘‘Act’’),1 and Rule 19b–4 thereunder,2
Exchange has not received any subject line if email is used. To help the notice is hereby given that on February
unsolicited written comments from Commission process and review your 9, 2016, BOX Options Exchange LLC
Members or other interested parties. comments more efficiently, please use (the ‘‘Exchange’’) filed with the
only one method. The Commission will Securities and Exchange Commission
III. Date of Effectiveness of the
post all comments on the Commission’s (‘‘Commission’’) the proposed rule
Proposed Rule Change and Timing for change as described in Items I, II, and
Internet Web site (http://www.sec.gov/
Commission Action III below, which Items have been
rules/sro.shtml). Copies of the
Because the foregoing proposed rule submission, all subsequent prepared by the Exchange. The
change does not: (A) Significantly affect amendments, all written statements Exchange filed the proposed rule change
the protection of investors or the public with respect to the proposed rule pursuant to section 19(b)(3)(A)(ii) of the
interest; (B) impose any significant change that are filed with the Act,3 and Rule 19b–4(f)(2) thereunder,4
burden on competition; and (C) become Commission, and all written which renders the proposal effective
operative for 30 days from the date on communications relating to the upon filing with the Commission. The
which it was filed or such shorter time proposed rule change between the Commission is publishing this notice to
as the Commission may designate, it has Commission and any person, other than solicit comments on the proposed rule
become effective pursuant to Section those that may be withheld from the change from interested persons.
19(b)(3)(A) of the Act 14 and paragraph public in accordance with the I. Self-Regulatory Organization’s
(f)(6) of Rule 19b–4 thereunder.15 The provisions of 5 U.S.C. 552, will be Statement of the Terms of the Substance
Exchange has given the Commission available for Web site viewing and of the Proposed Rule Change
written notice of its intent to file the printing in the Commission’s Public
proposed rule change, along with a brief Reference Room, 100 F Street NE., The Exchange is filing with the
description and text of the proposed Washington, DC 20549, on official Securities and Exchange Commission
rule change at least five business days business days between the hours of (‘‘Commission’’) a proposed rule change
prior to the date of filing of the 10:00 a.m. and 3:00 p.m. Copies of such to amend the Fee Schedule to delete the
proposed rule change, or such shorter filing will also be available for Continuing Education Fees and the
time as designated by the Commission. inspection and copying at the principal Qualification Examination Fee which
At any time within 60 days of the office of the Exchange. All comments relate to the Series 56 registration
filing of the proposed rule change, the received will be posted without change; category under the Regulatory Fees
Commission summarily may section of the BOX Fee Schedule on the
the Commission does not edit personal
temporarily suspend such rule change if BOX Market LLC (‘‘BOX’’) options
identifying information from
it appears to the Commission that such facility. The text of the proposed rule
submissions. You should submit only
action is: (1) Necessary or appropriate in change is available from the principal
information that you wish to make
the public interest; (2) for the protection office of the Exchange, at the
available publicly. All submissions
of investors; or (3) otherwise in Commission’s Public Reference Room
should refer to File No. SR–BYX–2016–
furtherance of the purposes of the Act. and also on the Exchange’s Internet Web
04 and should be submitted on or before
If the Commission takes such action, the site at http://boxexchange.com.
March 17, 2016.
Commission shall institute proceedings II. Self-Regulatory Organization’s
to determine whether the proposed rule Statement of the Purpose of, and
For the Commission, by the Division of
should be approved or disapproved. Trading and Markets, pursuant to delegated Statutory Basis for, the Proposed Rule
IV. Solicitation of Comments authority.16 Change
Interested persons are invited to Brent J. Fields, In its filing with the Commission, the
submit written data, views and Secretary. Exchange included statements
arguments concerning the foregoing, [FR Doc. 2016–03947 Filed 2–24–16; 8:45 am] concerning the purpose of and basis for
including whether the proposal is BILLING CODE 8011–01–P the proposed rule change and discussed
consistent with the Act. Comments may any comments it received on the
be submitted by any of the following proposed rule change. The text of these
methods: SECURITIES AND EXCHANGE statements may be examined at the
COMMISSION places specified in Item IV below. The
Electronic Comments Exchange has prepared summaries, set
• Use the Commission’s Internet [Release No. 34–77193; File No. SR–BOX– forth in sections A, B, and C below, of
comment form (http://www.sec.gov/ 2016–09] the most significant aspects of such
rules/sro.shtml); or statements.
• Send an email to rule- Self-Regulatory Organizations; BOX
A. Self-Regulatory Organization’s
comments@sec.gov. Please include File Options Exchange LLC; Notice of
Statement of the Purpose of, and
Number SR–BYX–2016–04 on the Filing and Immediate Effectiveness of
Statutory Basis for, the Proposed Rule
subject line. a Proposed Rule Change To Amend
Change
the Fee Schedule To Eliminate Certain
Paper Comments Fees Which Relate to the Series 56 1. Purpose
• Send paper comments in triplicate Examination and To Include Certain The Exchange proposes to amend the
mstockstill on DSK4VPTVN1PROD with NOTICES

to Secretary, Securities and Exchange Fees Which Relate to Series 57 Fee Schedule for trading on BOX to
Commission, 100 F Street NE., Examination and Continuing Education delete the Continuing Education Fees
Washington, DC 20549–1090. and the Qualification Examination Fee
February 19, 2016.
All submissions should refer to File
Number SR–BYX–2016–04. This file Pursuant to section 19(b)(1) of the 1 15 U.S.C. 78s(b)(1).
Securities Exchange Act of 1934 (the 2 17 CFR 240.19b–4.
14 15 U.S.C. 78s(b)(3)(A). 3 15 U.S.C. 78s(b)(3)(A)(ii).
15 17 CFR 240.19b–4. 16 17 CFR 200.30–3(a)(12). 4 17 CFR 240.19b–4(f)(2).

VerDate Sep<11>2014 18:07 Feb 24, 2016 Jkt 238001 PO 00000 Frm 00139 Fmt 4703 Sfmt 4703 E:\FR\FM\25FEN1.SGM 25FEN1
Document Created: 2018-02-02 14:35:26
Document Modified: 2018-02-02 14:35:26
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 9556