81 FR 96100 - Self-Regulatory Organizations; NASDAQ BX, Inc.; Notice of Filing of Proposed Rule Change, as Modified by Amendment No. 1 Thereto, To Permit BX To Accept Inbound Options Orders Routed by Nasdaq Execution Services LLC
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 250 (December 29, 2016)
Federal Register Volume 81, Issue 250 (December 29, 2016)
| Page Range | 96100-96102 | |
| FR Document | 2016-31476 |
[Federal Register Volume 81, Number 250 (Thursday, December 29, 2016)] [Notices] [Pages 96100-96102] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-31476] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-79661; File No. SR-BX-2016-068] Self-Regulatory Organizations; NASDAQ BX, Inc.; Notice of Filing of Proposed Rule Change, as Modified by Amendment No. 1 Thereto, To Permit BX To Accept Inbound Options Orders Routed by Nasdaq Execution Services LLC December 22, 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 December 9, 2016, NASDAQ BX, Inc. (``BX'' or the ``Exchange'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change. On December 20, 2016, the Exchange filed Amendment No. 1 to the proposed rule change, which amended and replaced the original filing in its entirety. The proposed rule change, as modified by Amendment No. 1, is described in Items I, II, and III below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change, as modified by Amendment No. 1 thereto, from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to permit BX to accept inbound options orders routed by Nasdaq Execution Services LLC (``NES'') from the International Securities Exchange, LLC (``ISE'') ISE Gemini, LLC (``ISE Gemini'') and ISE Mercury, LLC (``ISE Mercury'') (collectively ``ISE Exchanges''). 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 the Statutory Basis for, the Proposed Rule Change 1. Purpose In conjunction with the ISE Exchanges seeking approval to provide outbound routing services to all options markets using an affiliated routing broker, NES,\3\ BX proposes that NES be permitted to route orders from the ISE Exchanges to BX, subject to certain limitations and conditions, as described below. --------------------------------------------------------------------------- \3\ See SR-ISE-2016-27, SR-ISE-Gemini-2016-16 and SR-ISE- Mercury-2016-22 (not yet published). --------------------------------------------------------------------------- NES is a broker-dealer and member of The Nasdaq Options Market LLC (``NOM''), Nasdaq Phlx LLC (``Phlx'') and BX (collectively ``Nasdaq Exchanges''). NES provides all routing functions for the Nasdaq Exchanges. The Nasdaq Exchanges and NES are permitted affiliates.\4\ Accordingly, the affiliate relationship between BX and NES, its member, raises the issue of an exchange's affiliation with a member of such exchange. Specifically, in connection with prior filings, the Commission has expressed concern that the affiliation of an exchange with one of its members raises the potential for unfair competitive advantage and potential conflicts of interest between an exchange's self-regulatory obligations and its commercial interests.\5\ --------------------------------------------------------------------------- \4\ See Phlx Rule 985, Nasdaq Rule 2160 and BX Rule 2140. \5\ See Securities Exchange Act Release Nos. 59153 (December 23, 2008), 73 FR 80485 (December 31, 2008) (SR-NASDAQ-2008-098); and 62736 (August 17, 2010), 75 FR 51861 (August 23, 2010) (SR-NASDAQ- 2010-100). See also Securities Exchange Act Release No. 58135 (July 10, 2008), 73 FR 40898 (July 16, 2008) (SR-NASDAQ-2008-061) (Permitting NOS to be affiliated with Phlx). --------------------------------------------------------------------------- Specifically, in connection with prior filings, the Commission has expressed concern that the affiliation of an exchange with one of its members raises the potential for unfair competitive advantage and potential conflicts of interest between an exchange's self-regulatory obligations and its commercial interests.\6\ The Nasdaq Exchanges received approval from the Commission to permit NES to become a member of these three markets subject to certain limitations and conditions in order to perform certain routing and other functions, respectively.\7\ Also recognizing that the Commission has expressed concern regarding the potential for conflicts of interest in instances where a member firm is affiliated with an exchange to which it is routing orders, the Nasdaq Exchanges previously proposed, and the Commission approved,\8\ NES's affiliation with the Nasdaq Exchanges to permit the Exchange to accept inbound [[Page 96101]] orders that NES routes in its capacity as a facility from other Nasdaq Exchanges, subject to the certain limitations and conditions. BX now proposes to permit BX to accept inbound options orders that NES routes in its capacity as a facility of the ISE Exchanges, subject to the following limitations and conditions:\9\ --------------------------------------------------------------------------- \6\ Securities Exchange Act Release Nos. 71416 (January 28, 2014), 79 FR 6244 (February 3, 2014) (SR-Phlx-2014-05); 71419 (January 28, 2014), 79 FR 6247 (February 3, 2014) (SR-NASDAQ-2014- 007); and 714121 (January 28, 2014), 79 FR 6264 (February 3, 2014) (SR-BX-2014-003). \7\ See Securities Exchange Act Release Nos. 59721 (April 7, 2009), 74 FR 17245 (April 14, 2009) (SR-Phlx-2009-32); 59779 (April 16, 2009) 74 FR 18600 (April 23, 2009) (SR-Phlx-2009-32, Amendment No. 1) notice of filing of proposed rule change relating to enhanced electronic trading platform for options); 61667 (March 5, 2010), 75 FR 11964 (March 12, 2016) (SR-Phlx-2010-36) (notice of filing and immediate effectiveness of proposed rule changes to establish procedures to prevent information advantages resulting from the affiliation between Phlx and NES); and 71416 (January 28, 2014), 79 FR 6244 (February 3, 2014) (SR-Phlx-2014-05) (notice of filing and immediate effectiveness of proposed rule change to inbound routing of options orders). Nasdaq Options Services was the affiliated broker-dealer prior to a rule change to utilize NES, another affiliated broker-dealer of Nasdaq. See also Securities Exchange Act Release Nos. 63769 (January 25, 2011), 76 FR 5423 (January 31, 2011) (SR-BX-2011-003); 63859 (February 7, 2011), 76 FR 8391 (February 14, 2011) (SR-BX-2011-007) (notice of filing of proposed rule change relating to permanent approval of the BX and NES inbound routing relationship); 71420 (January 28, 2014), 79 FR 6256 (February 3, 2014) (SR-BX-2014-004) (notice of filing and immediate effectiveness of proposed rule change to inbound routing). See also Securities Exchange Act Release Nos. 65554 (October 13, 2011), 76 FR 65311 (October 20, 2011) (SR-NASDAQ-2011-142); 71418 (January 28, 2014), 79 FR 6262 (February 3, 2014) (SR-NASDAQ-2014-008)(notice of filing and immediate effectiveness of proposed rule change to inbound routing). \8\ Id. \9\ The Exchange notes that similar filings are proposed for the Nasdaq and Phlx markets. See SR-Nasdaq-2016-169 and SR-Phlx-2016-120 (not published). ---------------------------------------------------------------------------First, the Exchange and FINRA maintain a Regulatory Services Agreement (``RSA''), as well as an agreement pursuant to Rule 17d-2 under the Act (``17d-2 Agreement'').\10\ Pursuant to the RSA and the 17d-2 Agreement, FINRA is allocated regulatory responsibilities to review NES's compliance with certain Exchange rules.\11\ Pursuant to the RSA, however, BX retains ultimate responsibility for enforcing its rules with respect to NES. --------------------------------------------------------------------------- \10\ 17 CFR 240.17d-2. FINRA reviews NES' compliance for certain common rules. The RSA with FINRA specifies the types of business activities that NES may undertake and it also indicates the obligations to which NES is subject under the RSA. Among other things, NES must maintain a certain amount of net capital pursuant to SEC Rule 15c3-1(a)(1)(ii) and operate pursuant to SEC Rule 15c3- 3(k)(2)(ii). NES is permitted to route orders in options to the appropriate market center for execution in accordance with member order and requirements. \11\ NES is also subject to independent oversight by FINRA, its designated examining authority, for compliance with financial responsibility requirements. --------------------------------------------------------------------------- Second, FINRA monitors NES for compliance with the Exchange's trading rules, and collects and maintains certain related information.\12\ --------------------------------------------------------------------------- \12\ Pursuant to the RSA, both FINRA and BX collect and maintain all alerts, complaints, investigations and enforcement actions in which NES (in its capacity as a facility of Phlx and NOM routing orders to BX) is identified as a participant that has potentially violated applicable Commission or Exchange rules. The Exchange and FINRA retain these records in an easily accessible manner in order to facilitate any potential review conducted by the Commission's Office of Compliance Inspections and Examinations. Pursuant to the RSA, the Exchange and FINRA would be required to perform these activities with respect to NES acting in its capacity as a facility of each of the affiliated entities routing orders to BX. --------------------------------------------------------------------------- Third, FINRA provides a report to the Exchange's chief regulatory officer (``CRO''), on a quarterly basis, that: (i) Quantifies all alerts (of which the Exchange or FINRA is aware) that identify NES as a participant that has potentially violated Commission or Exchange rules, and (ii) lists all investigations that identify NES as a participant that has potentially violated Commission or Exchange rules. Fourth, BX has in place BX Rule 2140(c), which requires Nasdaq, Inc., as the holding company owning both the Exchange and NES, to establish and maintain procedures and internal controls reasonably designed to ensure that NES does not develop or implement changes to its system, based on non-public information obtained regarding planned changes to the Exchange's systems as a result of its affiliation with the Exchange, until such information is available generally to similarly situated Exchange members, in connection with the provision of inbound order routing to the Exchange.\13\ --------------------------------------------------------------------------- \13\ See Securities Exchange Act Release Nos. 63769 (January 25, 2011), 76 FR 5423 (January 31, 2011) (SR-BX-2011-003); 63859 (February 7, 2011), 76 FR 8391 (February 14, 2011) (SR-BX-2011-007) (notice of filing of proposed rule change relating to permanent approval of the BX and NES inbound routing relationship); 71420 (January 28, 2014), 79 FR 6256 (February 3, 2014)(SR-BX-2014- 004)(notice of filing and immediate effectiveness of proposed rule change to inbound routing). --------------------------------------------------------------------------- The Exchange has met all the above-listed conditions in connection with NES routing in its capacity as a facility of NOM and Phlx. By meeting the above conditions, the Exchange has set up mechanisms that protect the independence of the Exchange's regulatory responsibility with respect to NES, as well as demonstrate that NES cannot use any information advantage it may have because of its affiliation with the Exchange. Because the Exchange has met all the above-listed conditions, it now seeks to permit an inbound routing relationship with the ISE Exchanges pursuant to the same conditions. The Exchange will continue to comply with the four conditions stated above. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,\14\ in general, and with Sections 6(b)(5) of the Act,\15\ in particular, in that the proposal 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 regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, 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, because the proposed rule change will allow the Exchange to continue to receive inbound orders from NES, acting in its capacity as a facility of Phlx and NOM, in a manner consistent with prior approvals and established protections and will further be permitted to receive inbound orders from the ISE Exchanges, for which NES will also act in its capacity as a facility of those markets. The Exchange believes that the proposed conditions establish mechanisms that protect the independence of the Exchange's regulatory responsibility with respect to NES, as well as ensure that NES cannot use any information it may have because of its affiliation with the Exchange, or affiliation with other Nasdaq Exchanges or ISE Exchanges, to its advantage. --------------------------------------------------------------------------- \14\ 15 U.S.C. 78f. \15\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act, as amended. Permitting BX to receive inbound orders from the ISE Exchanges does not create any issues of intra-market competition because it involves inbound routing from affiliated markets. Nor does it result in a burden on competition among exchanges, because there are many competing options exchanges that provide routing services, including through an affiliate. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the Exchange consents, the Commission shall: (a) by order approve or disapprove such proposed rule change, or (b) institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change, as modified by Amendment No. 1, is consistent with the Act. Comments may be submitted by any of the following methods: [[Page 96102]] 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-BX-2016-068 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-BX-2016-068. 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 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-BX-2016-068, and should be submitted on or before January 19, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\16\ --------------------------------------------------------------------------- \16\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2016-31476 Filed 12-28-16; 8:45 am] BILLING CODE 8011-01-P
![96100 Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices
public in accordance with the I. Self-Regulatory Organization’s an exchange’s self-regulatory obligations
provisions of 5 U.S.C. 552, will be Statement of the Terms of Substance of and its commercial interests.5
available for Web site viewing and the Proposed Rule Change Specifically, in connection with prior
printing in the Commission’s Public filings, the Commission has expressed
Reference Room, 100 F Street NE., The Exchange proposes to permit BX concern that the affiliation of an
Washington, DC 20549 on official to accept inbound options orders routed exchange with one of its members raises
business days between the hours of by Nasdaq Execution Services LLC the potential for unfair competitive
10:00 a.m. and 3:00 p.m. Copies of such (‘‘NES’’) from the International advantage and potential conflicts of
filing also will be available for Securities Exchange, LLC (‘‘ISE’’) ISE interest between an exchange’s self-
inspection and copying at the principal Gemini, LLC (‘‘ISE Gemini’’) and ISE regulatory obligations and its
office of the Exchange. All comments Mercury, LLC (‘‘ISE Mercury’’) commercial interests.6 The Nasdaq
received will be posted without change; (collectively ‘‘ISE Exchanges’’). Exchanges received approval from the
the Commission does not edit personal Commission to permit NES to become a
II. Self-Regulatory Organization’s member of these three markets subject
identifying information from Statement of the Purpose of, and
submissions. You should submit only to certain limitations and conditions in
Statutory Basis for, the Proposed Rule order to perform certain routing and
information that you wish to make Change
available publicly. All submissions other functions, respectively.7 Also
should refer to File Number SR–ISE– In its filing with the Commission, the recognizing that the Commission has
2016–27, and should be submitted on or Exchange included statements expressed concern regarding the
before January 19, 2017. concerning the purpose of and basis for potential for conflicts of interest in
the proposed rule change and discussed instances where a member firm is
For the Commission, by the Division of
any comments it received on the affiliated with an exchange to which it
Trading and Markets, pursuant to delegated
authority.40 proposed rule change. The text of these is routing orders, the Nasdaq Exchanges
statements may be examined at the previously proposed, and the
Eduardo A. Aleman,
Commission approved,8 NES’s
Assistant Secretary. places specified in Item IV below. The
affiliation with the Nasdaq Exchanges to
[FR Doc. 2016–31480 Filed 12–28–16; 8:45 am] Exchange has prepared summaries, set
permit the Exchange to accept inbound
BILLING CODE 8011–01–P forth in sections A, B, and C below, of
the most significant aspects of such 5 See Securities Exchange Act Release Nos. 59153
statements. (December 23, 2008), 73 FR 80485 (December 31,
SECURITIES AND EXCHANGE 2008) (SR–NASDAQ–2008–098); and 62736 (August
A. Self-Regulatory Organization’s 17, 2010), 75 FR 51861 (August 23, 2010) (SR–
COMMISSION
Statement of the Purpose of, and the NASDAQ–2010–100). See also Securities Exchange
[Release No. 34–79661; File No. SR–BX– Statutory Basis for, the Proposed Rule Act Release No. 58135 (July 10, 2008), 73 FR 40898
(July 16, 2008) (SR–NASDAQ–2008–061)
2016–068] Change (Permitting NOS to be affiliated with Phlx).
6 Securities Exchange Act Release Nos. 71416
Self-Regulatory Organizations; 1. Purpose
(January 28, 2014), 79 FR 6244 (February 3, 2014)
NASDAQ BX, Inc.; Notice of Filing of (SR–Phlx–2014–05); 71419 (January 28, 2014), 79
In conjunction with the ISE
Proposed Rule Change, as Modified by FR 6247 (February 3, 2014) (SR–NASDAQ–2014–
Exchanges seeking approval to provide 007); and 714121 (January 28, 2014), 79 FR 6264
Amendment No. 1 Thereto, To Permit
outbound routing services to all options (February 3, 2014) (SR–BX–2014–003).
BX To Accept Inbound Options Orders
Routed by Nasdaq Execution Services markets using an affiliated routing 7 See Securities Exchange Act Release Nos. 59721
broker, NES,3 BX proposes that NES be (April 7, 2009), 74 FR 17245 (April 14, 2009) (SR–
LLC Phlx–2009–32); 59779 (April 16, 2009) 74 FR 18600
permitted to route orders from the ISE (April 23, 2009) (SR–Phlx–2009–32, Amendment
December 22, 2016. Exchanges to BX, subject to certain No. 1) notice of filing of proposed rule change
Pursuant to Section 19(b)(1) of the limitations and conditions, as described relating to enhanced electronic trading platform for
below. options); 61667 (March 5, 2010), 75 FR 11964
Securities Exchange Act of 1934 (March 12, 2016) (SR–Phlx–2010–36) (notice of
(‘‘Act’’) 1 and Rule 19b-4 thereunder,2 NES is a broker-dealer and member of filing and immediate effectiveness of proposed rule
notice is hereby given that on December The Nasdaq Options Market LLC changes to establish procedures to prevent
9, 2016, NASDAQ BX, Inc. (‘‘BX’’ or the information advantages resulting from the
(‘‘NOM’’), Nasdaq Phlx LLC (‘‘Phlx’’) affiliation between Phlx and NES); and 71416
‘‘Exchange’’) filed with the Securities and BX (collectively ‘‘Nasdaq (January 28, 2014), 79 FR 6244 (February 3, 2014)
and Exchange Commission Exchanges’’). NES provides all routing (SR–Phlx–2014–05) (notice of filing and immediate
(‘‘Commission’’) the proposed rule functions for the Nasdaq Exchanges. effectiveness of proposed rule change to inbound
change. On December 20, 2016, the routing of options orders). Nasdaq Options Services
The Nasdaq Exchanges and NES are was the affiliated broker-dealer prior to a rule
Exchange filed Amendment No. 1 to the permitted affiliates.4 Accordingly, the change to utilize NES, another affiliated broker-
proposed rule change, which amended affiliate relationship between BX and dealer of Nasdaq. See also Securities Exchange Act
and replaced the original filing in its NES, its member, raises the issue of an Release Nos. 63769 (January 25, 2011), 76 FR 5423
entirety. The proposed rule change, as (January 31, 2011) (SR–BX–2011–003); 63859
exchange’s affiliation with a member of (February 7, 2011), 76 FR 8391 (February 14, 2011)
modified by Amendment No. 1, is such exchange. Specifically, in (SR–BX–2011–007) (notice of filing of proposed
described in Items I, II, and III below, connection with prior filings, the rule change relating to permanent approval of the
which Items have been prepared by the Commission has expressed concern that BX and NES inbound routing relationship); 71420
(January 28, 2014), 79 FR 6256 (February 3, 2014)
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Exchange. The Commission is the affiliation of an exchange with one (SR–BX–2014–004) (notice of filing and immediate
publishing this notice to solicit of its members raises the potential for effectiveness of proposed rule change to inbound
comments on the proposed rule change, unfair competitive advantage and routing). See also Securities Exchange Act Release
as modified by Amendment No. 1 potential conflicts of interest between Nos. 65554 (October 13, 2011), 76 FR 65311
thereto, from interested persons. (October 20, 2011) (SR–NASDAQ–2011–142); 71418
(January 28, 2014), 79 FR 6262 (February 3, 2014)
3 See SR–ISE–2016–27, SR–ISE–Gemini–2016–16 (SR–NASDAQ–2014–008)(notice of filing and
40 17 CFR 200.30–3(a)(12). and SR–ISE–Mercury–2016–22 (not yet published). immediate effectiveness of proposed rule change to
1 15 U.S.C. 78s(b)(1). 4 See Phlx Rule 985, Nasdaq Rule 2160 and BX inbound routing).
2 17 CFR 240.19b–4. Rule 2140. 8 Id.
VerDate Sep<11>2014 18:41 Dec 28, 2016 Jkt 241001 PO 00000 Frm 00145 Fmt 4703 Sfmt 4703 E:\FR\FM\29DEN1.SGM 29DEN1](https://thefederalregister.org/doc/81_FR_96350/page/1.svg)
![96102 Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices
Electronic Comments SECURITIES AND EXCHANGE the places specified in Item IV below.
COMMISSION The Exchange has prepared summaries,
• Use the Commission’s Internet set forth in sections A, B, and C below,
comment form (http://www.sec.gov/ [Release No. 34–79678; File No. SR–
NYSEArca–2016–167]
of the most significant parts of such
rules/sro.shtml); or statements.
• Send an email to rule-comments@ Self-Regulatory Organizations; NYSE A. Self-Regulatory Organization’s
sec.gov. Please include File Number SR– Arca, Inc.; Notice of Filing of Proposed Statement of the Purpose of, and
BX–2016–068 on the subject line. Rule Change in Connection With the Statutory Basis for, the Proposed Rule
Proposed Acquisition of National Change
Paper Comments Stock Exchange, Inc. by the
Exchange’s Parent the NYSE Group, 1. Purpose
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities Inc. To Amend Certain Organizational Background
and Exchange Commission, 100 F Street Documents of NYSE Group, NYSE
On December 14, 2016, ICE entered
NE., Washington, DC 20549–1090. Holdings LLC, Intercontinental
into an agreement with the NSX
Exchange Holdings, Inc., and
All submissions should refer to File pursuant to which its wholly-owned
Intercontinental Exchange, Inc.
Number SR–BX–2016–068. This file subsidiary NYSE Group would acquire
December 22, 2016. all of the outstanding capital stock of
number should be included on the
Pursuant to Section 19(b)(1) 1 of the the NSX (the ‘‘Acquisition’’). As a result
subject line if email is used. To help the
Securities Exchange Act of 1934 (the of the Acquisition, the NSX would be
Commission process and review your renamed NYSE National, Inc. (‘‘NYSE
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
comments more efficiently, please use National’’) and would be operated as a
notice is hereby given that, on December
only one method. The Commission will 16, 2016, NYSE Arca, Inc. (the wholly-owned subsidiary of NYSE
post all comments on the Commission’s ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with Group. NYSE Group is a wholly-owned
Internet Web site (http://www.sec.gov/ the Securities and Exchange subsidiary of NYSE Holdings, which is
rules/sro.shtml). Copies of the Commission (the ‘‘Commission’’) the in turn 100% owned by ICE Holdings.
submission, all subsequent proposed rule change as described in ICE, a public company listed on the
amendments, all written statements Items I and II below, which Items have New York Stock Exchange LLC (the
with respect to the proposed rule been prepared by the self-regulatory ‘‘NYSE’’), owns 100% of ICE Holdings.
change that are filed with the organization. The Commission is Following the Acquisition, NYSE
Commission, and all written publishing this notice to solicit National would continue to be
communications relating to the comments on the proposed rule change registered as a national securities
proposed rule change between the from interested persons. exchange and as a separate self-
Commission and any person, other than regulatory organization (‘‘SRO’’). As
I. Self-Regulatory Organization’s such, NYSE National would continue to
those that may be withheld from the
Statement of the Terms of Substance of have separate rules, membership rosters,
public in accordance with the the Proposed Rule Change
provisions of 5 U.S.C. 552, will be and listings that would be distinct from
available for Web site viewing and The Exchange proposes in connection the rules, membership rosters, and
printing in the Commission’s Public with the proposed acquisition of listings of the three other registered
Reference Room, 100 F Street NE., National Stock Exchange, Inc. (‘‘NSX’’) national securities exchanges and SROs
by the Exchange’s parent the NYSE owned by NYSE Group, namely, the
Washington, DC 20549 on official
Group, Inc. (‘‘NYSE Group’’), to amend NYSE, NYSE MKT and the Exchange
business days between the hours of
certain organizational documents of (together, the ‘‘NYSE Exchanges’’).4
10:00 a.m. and 3:00 p.m. Copies of such NYSE Group, NYSE Holdings LLC In connection with the Acquisition
filing also will be available for (‘‘NYSE Holdings’’), Intercontinental and as discussed more fully below, the
inspection and copying at the principal Exchange Holdings, Inc. (‘‘ICE following organizational documents of
office of the Exchange. All comments Holdings’’), and Intercontinental NYSE Group and its intermediary and
received will be posted without change; Exchange, Inc. (‘‘ICE’’). The proposed ultimate parent entities would be
the Commission does not edit personal rule change is available on the amended:
identifying information from Exchange’s Web site at www.nyse.com, • ICE bylaws and director
submissions. You should submit only at the principal office of the Exchange, independence policy,
information that you wish to make and at the Commission’s Public • ICE Holdings bylaws and certificate
available publicly. All submissions Reference Room. of incorporation,
should refer to File Number SR–BX– • NYSE Holdings operating
II. Self-Regulatory Organization’s agreement, and
2016–068, and should be submitted on
Statement of the Purpose of, and • NYSE Group bylaws and certificate
or before January 19, 2017.
Statutory Basis for, the Proposed Rule of incorporation.
For the Commission, by the Division of Change These proposed changes would
Trading and Markets, pursuant to delegated consist of technical and conforming
In its filing with the Commission, the
authority.16 amendments to reflect the proposed
self-regulatory organization included
Eduardo A. Aleman,
asabaliauskas on DSK3SPTVN1PROD with NOTICES
statements concerning the purpose of, new ownership of NYSE National by the
Assistant Secretary. and basis for, the proposed rule change NYSE Group, and, indirectly, ICE.5
[FR Doc. 2016–31476 Filed 12–28–16; 8:45 am] and discussed any comments it received
4 The NYSE Exchanges are referred to as the U.S.
BILLING CODE 8011–01–P on the proposed rule change. The text
Regulated Subsidiaries in the corporate documents
of those statements may be examined at proposed to be amended in this rule filing.
5 The proposed revisions are also discussed in the
1 15 U.S.C. 78s(b)(1). NYSE and NYSE MKT companion rule filings
2 15 U.S.C. 78a. related to the Acquisition. See SR–NYSE–2016–90
16 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4. & SR–NYSEMKT–2016–122.
VerDate Sep<11>2014 18:41 Dec 28, 2016 Jkt 241001 PO 00000 Frm 00147 Fmt 4703 Sfmt 4703 E:\FR\FM\29DEN1.SGM 29DEN1](https://thefederalregister.org/doc/81_FR_96350/page/3.svg)
Document Created: 2016-12-29 01:59:15
Document Modified: 2016-12-29 01:59:15
| 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 96100 |
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR