82_FR_11710 82 FR 11674 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Rules 6.62, 6.73 and Make a Conforming Change to Rule 6.47A

82 FR 11674 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Rules 6.62, 6.73 and Make a Conforming Change to Rule 6.47A

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 36 (February 24, 2017)

Page Range11674-11676
FR Document2017-03572

Federal Register, Volume 82 Issue 36 (Friday, February 24, 2017)
[Federal Register Volume 82, Number 36 (Friday, February 24, 2017)]
[Notices]
[Pages 11674-11676]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-03572]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80059; File No. SR-NYSEArca-2017-16]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending Rules 
6.62, 6.73 and Make a Conforming Change to Rule 6.47A

February 17, 2017.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that, on February 10, 2017, NYSE Arca, Inc. (``Exchange'' or ``NYSE 
Arca'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Rule 6.62 to eliminate Price 
Improving Orders and Quotes, and amend Rule 6.73 to eliminate the 
electronic and open outcry bidding and offering requirements associated 
with a Price Improving Order or Quote, and make a conforming change to 
Rule 6.47A. The proposed rule change is available on the Exchange's Web 
site at www.nyse.com, at the principal office of the Exchange, and at 
the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

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

1. Purpose
    The Exchange proposes to amend Rule 6.62 to eliminate Price 
Improving Orders and Quotes, and amend Rule 6.73 to eliminate the 
electronic and open outcry bidding and offering requirements associated 
with a Price Improving Order or Quote, and make a conforming change to 
Rule 6.47A. The Exchange proposes to eliminate these order types in 
order to streamline its rules and reduce complexity among its order 
type offerings.\4\
---------------------------------------------------------------------------

    \4\ See e.g., Mary Jo White, Chair, Securities and Exchange 
Commission, Speech at the Sandler O'Neill & Partners, L.P. Global 
Exchange and Brokerage Conference (June 5, 2014) (available at 
www.sec.gov/News/Speech/Detail/Speech/1370542004312#.U5HI-fmwJiw) 
(``I am asking the exchanges to conduct a comprehensive review of 
their order types and how they operate in practice. As part of this 
review, I expect that the exchanges will consider appropriate rule 
changes to help clarify the nature of their order types and how they 
interact with each other, and how they support fair, orderly, and 
efficient markets.'' Id.)
---------------------------------------------------------------------------

Elimination of Price Improving Orders and Quotes
    The Exchange proposes to eliminate, and thus delete from its rules, 
Price Improving Orders and Quotes, as defined in Rule 6.62(s).
    A Price Improving Order or Price Improving Quote is an order or 
quote to buy or sell an option at a specified price at an increment 
smaller than the minimum price variation in the security. Price 
Improving Orders and Quotes may be entered in increments as small as 
one cent. Because the Exchange has not implemented this functionality, 
the Exchange believes it is appropriate to delete the functionality 
from its rules.\5\
---------------------------------------------------------------------------

    \5\ Though originally adopted as a competitive response to 
another options market introducing price improving orders, the 
Exchange never implemented this functionality for a variety of 
reasons, including technology and because most options volume was 
concentrated in Penny Pilot issues where price improving orders 
would be of little or no value.
---------------------------------------------------------------------------

    To reflect this elimination, the Exchange proposes to delete all 
references to Price Improving Orders and Quotes in Rule 6.62(s), and to 
the electronic and open outcry bidding and offering requirements 
associated with a Price Improving Order or Quote in the second 
introductory paragraph of Rule 6.73 and Rules 6.73(a), 6.73(b) and 
6.73(c), and to delete in the Commentary to Rule 6.47A references to 
Rule 6.62(s) and 6.73, as follows: \6\
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    \6\ See Securities Exchange Act Release No. 58079 (July 2, 
2008), 73 FR 39365 (July 9, 2009) (SR-NYSEArca-2008-69) (notice of 
filing and immediate effectiveness of proposed rule change to permit 
use of a new order type known as Price Improving Orders and Quotes).

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[[Page 11675]]

     Delete Rule 6.62(s), which defines Price Improving Orders 
and Quotes;
     delete the second introductory paragraph of Rule 6.73, 
which describes which options may be designated for penny price 
improvement;
     delete Rule 6.73(a), which describes the electronic 
submission process in connection with a Price Improving Order or Quote;
     delete Rule 6.73(b), which describes the open outcry 
submission process in connection with a Price Improving Order or Quote;
     delete Rule 6.73(c), which describes the requirement to 
electronically ``sweep'' any penny pricing interest in the Exchange's 
System; and
     delete in the Commentary to Rule 6.47A references to Rules 
6.62(s) and 6.73.\7\
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    \7\ An affiliated Exchange recently eliminated Price Improving 
Orders and Quotes. See Securities Exchange Act Release No. 34-79875 
(January 30, 2017), 82 FR 9256 (February 3, 2017) (SR-NYSEMKT-2017-
03) (notice of filing and immediate effectiveness of proposed rule 
change amending rules).
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2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) \8\ of the 
Act, in general, and furthers the objectives of Section 6(b)(5),\9\ 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 mechanism of a free and open 
market and a national market system.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    Specifically, the Exchange believes that eliminating Price 
Improving Orders and Quotes would remove impediments to and perfect a 
national market system by simplifying the functionality and complexity 
of its order types. The Exchange believes that eliminating these order 
types would be consistent with the public interest and the protection 
of investors because investors will not be harmed and in fact would 
benefit from the removal of complex functionality. The Exchange also 
believes that eliminating Price Improving Orders and Quotes would 
benefit investors and add transparency and clarity to the Exchange's 
rules because the functionality of those order types was not 
implemented and therefore is not available. The Exchange further 
believes that deleting a corresponding reference in Exchange rules to 
deleted order types, and the associated bidding and offering process in 
connection with a deleted order type, also removes impediments to and 
perfects the mechanism of a free and open market by ensuring that 
members, regulators and the public can more easily navigate the 
Exchange's rulebook and better understand the order types available for 
trading on the Exchange. Removing an obsolete cross reference also 
furthers the goal of transparency and adds clarity to the Exchange's 
rules.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. The proposed change is not 
designed to address any competitive issue but would rather eliminate 
complex functionality and references to functionality that is not 
available, thereby reducing confusion and making the Exchange's rules 
easier to understand and navigate.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \10\ and Rule 19b-4(f)(6) thereunder.\11\ 
Because the 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 prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \11\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \12\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\13\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest.
---------------------------------------------------------------------------

    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such 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 under 
Section 19(b)(2)(B) \14\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \14\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

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-NYSEArca-2017-16 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-NYSEArca-2017-16. 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

[[Page 11676]]

Reference Room, 100 F Street NE., Washington, DC 20549 on official 
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of 
the filing also will be available for inspection and copying at the 
principal office of the Exchange. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-NYSEArca-2017-16 and should be submitted on or before 
March 17, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-03572 Filed 2-23-17; 8:45 am]
 BILLING CODE 8011-01-P



                                                    11674                          Federal Register / Vol. 82, No. 36 / Friday, February 24, 2017 / Notices

                                                    of P.M.-settled S&P 500 Index options                   SECURITIES AND EXCHANGE                               A. Self-Regulatory Organization’s
                                                    with expirations every Friday of the                    COMMISSION                                            Statement of the Purpose of, and the
                                                    month.20 The Commission believes that                                                                         Statutory Basis for, the Proposed Rule
                                                    the proposal can thus benefit investors                 [Release No. 34–80059; File No. SR–                   Change
                                                    by providing them with additional                       NYSEArca–2017–16]                                     1. Purpose
                                                    trading flexibility for both simple and
                                                    complex orders.                                         Self-Regulatory Organizations; NYSE                      The Exchange proposes to amend
                                                                                                            Arca, Inc.; Notice of Filing and                      Rule 6.62 to eliminate Price Improving
                                                       Further, the Exchange represents that
                                                                                                            Immediate Effectiveness of Proposed                   Orders and Quotes, and amend Rule
                                                    there are minimal differences in the
                                                                                                            Rule Change Amending Rules 6.62,                      6.73 to eliminate the electronic and
                                                    trading parameters of the two options
                                                                                                            6.73 and Make a Conforming Change                     open outcry bidding and offering
                                                    classes.21 Although the appointment
                                                                                                            to Rule 6.47A                                         requirements associated with a Price
                                                    costs for SPXPM and SPX are different,
                                                                                                                                                                  Improving Order or Quote, and make a
                                                    the Exchange represents that market
                                                                                                            February 17, 2017.                                    conforming change to Rule 6.47A. The
                                                    makers should not be adversely
                                                                                                                                                                  Exchange proposes to eliminate these
                                                    impacted by this proposal because all                      Pursuant to Section 19(b)(1) 1 of the
                                                                                                                                                                  order types in order to streamline its
                                                    market-makers currently appointed in                    Securities Exchange Act of 1934                       rules and reduce complexity among its
                                                    SPXPM also are appointed in SPX,                        (‘‘Act’’) 2 and Rule 19b–4 thereunder,3               order type offerings.4
                                                    which confers the right to trade SPXW                   notice is hereby given that, on February
                                                    options.22 The Commission believes                      10, 2017, NYSE Arca, Inc. (‘‘Exchange’’               Elimination of Price Improving Orders
                                                    that, to the extent the trading parameters              or ‘‘NYSE Arca’’) filed with the                      and Quotes
                                                    of the two classes are substantively                    Securities and Exchange Commission                       The Exchange proposes to eliminate,
                                                    similar, the Exchange’s proposal to                     (‘‘Commission’’) the proposed rule                    and thus delete from its rules, Price
                                                    move SPXPM options into the SPX                         change as described in Items I, II, and               Improving Orders and Quotes, as
                                                    options class does not raise novel                      III below, which Items have been                      defined in Rule 6.62(s).
                                                    issues.                                                 prepared by the self-regulatory                          A Price Improving Order or Price
                                                       Finally, SPXPM options currently are                 organization. The Commission is                       Improving Quote is an order or quote to
                                                    listed on a pilot basis. As part of the                 publishing this notice to solicit                     buy or sell an option at a specified price
                                                    pilot, the Exchange has been required to                comments on the proposed rule change                  at an increment smaller than the
                                                    submit to the Commission quarterly                      from interested persons.                              minimum price variation in the
                                                    reports and annual reports that analyze                                                                       security. Price Improving Orders and
                                                                                                            I. Self-Regulatory Organization’s
                                                    the market impact and trading patterns                                                                        Quotes may be entered in increments as
                                                                                                            Statement of the Terms of Substance of
                                                    of third-Friday P.M.-settled S&P 500                                                                          small as one cent. Because the Exchange
                                                                                                            the Proposed Rule Change
                                                    options. The Exchange represents that it                                                                      has not implemented this functionality,
                                                    will continue to provide this data in                      The Exchange proposes to amend                     the Exchange believes it is appropriate
                                                    exactly the same scope and format.23                    Rule 6.62 to eliminate Price Improving                to delete the functionality from its
                                                    The Commission believes that the                        Orders and Quotes, and amend Rule                     rules.5
                                                    continued pilot and reports will allow                  6.73 to eliminate the electronic and                     To reflect this elimination, the
                                                    the Exchange and the Commission to                      open outcry bidding and offering                      Exchange proposes to delete all
                                                    monitor for and assess any potential                    requirements associated with a Price                  references to Price Improving Orders
                                                    adverse market impact caused by these                   Improving Order or Quote, and make a                  and Quotes in Rule 6.62(s), and to the
                                                    P.M.-settled options.                                   conforming change to Rule 6.47A. The                  electronic and open outcry bidding and
                                                       Based on the Exchange’s                              proposed rule change is available on the              offering requirements associated with a
                                                    representations discussed above, and for                Exchange’s Web site at www.nyse.com,                  Price Improving Order or Quote in the
                                                    the reasons noted above, the                            at the principal office of the Exchange,              second introductory paragraph of Rule
                                                    Commission believes that the proposal                   and at the Commission’s Public                        6.73 and Rules 6.73(a), 6.73(b) and
                                                    to move SPXPM options into the SPX                      Reference Room.                                       6.73(c), and to delete in the
                                                    options class is consistent with the Act.                                                                     Commentary to Rule 6.47A references to
                                                                                                            II. Self-Regulatory Organization’s                    Rule 6.62(s) and 6.73, as follows: 6
                                                    IV. Conclusion                                          Statement of the Purpose of, and
                                                                                                            Statutory Basis for, the Proposed Rule                   4 See e.g., Mary Jo White, Chair, Securities and
                                                      It is therefore ordered, pursuant to                  Change                                                Exchange Commission, Speech at the Sandler
                                                    Section 19(b)(2) of the Act 24, that the                                                                      O’Neill & Partners, L.P. Global Exchange and
                                                    proposed rule change (SR–CBOE–2016–                                                                           Brokerage Conference (June 5, 2014) (available at
                                                                                                              In its filing with the Commission, the              www.sec.gov/News/Speech/Detail/Speech/
                                                    091) be, and hereby is, approved.                       self-regulatory organization included                 1370542004312#.U5HI-fmwJiw) (‘‘I am asking the
                                                      For the Commission, by the Division of                statements concerning the purpose of,                 exchanges to conduct a comprehensive review of
                                                    Trading and Markets, pursuant to delegated              and basis for, the proposed rule change               their order types and how they operate in practice.
                                                                                                                                                                  As part of this review, I expect that the exchanges
                                                    authority.25                                            and discussed any comments it received                will consider appropriate rule changes to help
                                                    Eduardo A. Aleman,                                      on the proposed rule change. The text                 clarify the nature of their order types and how they
                                                    Assistant Secretary.                                    of those statements may be examined at                interact with each other, and how they support fair,
                                                                                                                                                                  orderly, and efficient markets.’’ Id.)
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    [FR Doc. 2017–03573 Filed 2–23–17; 8:45 am]             the places specified in Item IV below.                   5 Though originally adopted as a competitive
                                                    BILLING CODE 8011–01–P
                                                                                                            The Exchange has prepared summaries,                  response to another options market introducing
                                                                                                            set forth in sections A, B, and C below,              price improving orders, the Exchange never
                                                      20 See Notice, supra note 3, at 1386.
                                                                                                            of the most significant parts of such                 implemented this functionality for a variety of
                                                      21 See                                                statements.                                           reasons, including technology and because most
                                                             id. at 1384–85.                                                                                      options volume was concentrated in Penny Pilot
                                                      22 See id. at 1385.
                                                                                                                                                                  issues where price improving orders would be of
                                                      23 See id.                                              1 15 U.S.C. 78s(b)(1).                              little or no value.
                                                      24 15 U.S.C. 78s(b)(2).                                 2 15 U.S.C. 78a.                                       6 See Securities Exchange Act Release No. 58079
                                                      25 17 CFR 200.30–3(a)(12).                              3 17 CFR 240.19b–4.                                 (July 2, 2008), 73 FR 39365 (July 9, 2009) (SR–



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                                                                                  Federal Register / Vol. 82, No. 36 / Friday, February 24, 2017 / Notices                                               11675

                                                       • Delete Rule 6.62(s), which defines                 that deleting a corresponding reference                to Rule 19b–4(f)(6)(iii),13 the
                                                    Price Improving Orders and Quotes;                      in Exchange rules to deleted order                     Commission may designate a shorter
                                                       • delete the second introductory                     types, and the associated bidding and                  time if such action is consistent with the
                                                    paragraph of Rule 6.73, which describes                 offering process in connection with a                  protection of investors and the public
                                                    which options may be designated for                     deleted order type, also removes                       interest.
                                                    penny price improvement;                                impediments to and perfects the                           At any time within 60 days of the
                                                       • delete Rule 6.73(a), which describes               mechanism of a free and open market by                 filing of such proposed rule change, the
                                                    the electronic submission process in                    ensuring that members, regulators and                  Commission summarily may
                                                    connection with a Price Improving                       the public can more easily navigate the                temporarily suspend such rule change if
                                                    Order or Quote;                                         Exchange’s rulebook and better                         it appears to the Commission that such
                                                       • delete Rule 6.73(b), which describes               understand the order types available for               action is necessary or appropriate in the
                                                    the open outcry submission process in                   trading on the Exchange. Removing an                   public interest, for the protection of
                                                    connection with a Price Improving                       obsolete cross reference also furthers the             investors, or otherwise in furtherance of
                                                    Order or Quote;                                         goal of transparency and adds clarity to               the purposes of the Act. If the
                                                       • delete Rule 6.73(c), which describes               the Exchange’s rules.                                  Commission takes such action, the
                                                    the requirement to electronically                                                                              Commission shall institute proceedings
                                                    ‘‘sweep’’ any penny pricing interest in                 B. Self-Regulatory Organization’s                      under Section 19(b)(2)(B) 14 of the Act to
                                                    the Exchange’s System; and                              Statement on Burden on Competition                     determine whether the proposed rule
                                                       • delete in the Commentary to Rule                     The Exchange does not believe that                   change should be approved or
                                                    6.47A references to Rules 6.62(s) and                   the proposed rule change will impose                   disapproved.
                                                    6.73.7                                                  any burden on competition that is not
                                                                                                            necessary or appropriate in furtherance                IV. Solicitation of Comments
                                                    2. Statutory Basis
                                                                                                            of the purposes of the Act. The                          Interested persons are invited to
                                                       The proposed rule change is                          proposed change is not designed to                     submit written data, views, and
                                                    consistent with Section 6(b) 8 of the Act,              address any competitive issue but                      arguments concerning the foregoing,
                                                    in general, and furthers the objectives of              would rather eliminate complex                         including whether the proposed rule
                                                    Section 6(b)(5),9 in particular, in that it             functionality and references to                        change is consistent with the Act.
                                                    is designed to prevent fraudulent and                   functionality that is not available,                   Comments may be submitted by any of
                                                    manipulative acts and practices, to                     thereby reducing confusion and making                  the following methods:
                                                    promote just and equitable principles of                the Exchange’s rules easier to
                                                    trade, to foster cooperation and                                                                               Electronic Comments
                                                                                                            understand and navigate.
                                                    coordination with persons engaged in                                                                             • Use the Commission’s Internet
                                                    facilitating transactions in securities,                C. Self-Regulatory Organization’s                      comment form (http://www.sec.gov/
                                                    and to remove impediments to and                        Statement on Comments on the                           rules/sro.shtml); or
                                                    perfect the mechanism of a free and                     Proposed Rule Change Received From                       • Send an email to rule-comments@
                                                    open market and a national market                       Members, Participants, or Others                       sec.gov. Please include File Number SR–
                                                    system.                                                   No written comments were solicited                   NYSEArca–2017–16 on the subject line.
                                                       Specifically, the Exchange believes                  or received with respect to the proposed
                                                    that eliminating Price Improving Orders                                                                        Paper Comments
                                                                                                            rule change.
                                                    and Quotes would remove impediments                                                                               • Send paper comments in triplicate
                                                    to and perfect a national market system                 III. Date of Effectiveness of the                      to Secretary, Securities and Exchange
                                                    by simplifying the functionality and                    Proposed Rule Change and Timing for                    Commission, 100 F Street NE.,
                                                    complexity of its order types. The                      Commission Action                                      Washington, DC 20549–1090.
                                                    Exchange believes that eliminating these                   The Exchange has filed the proposed                 All submissions should refer to File
                                                    order types would be consistent with                    rule change pursuant to Section                        Number SR–NYSEArca–2017–16. This
                                                    the public interest and the protection of               19(b)(3)(A)(iii) of the Act 10 and Rule                file number should be included on the
                                                    investors because investors will not be                 19b–4(f)(6) thereunder.11 Because the                  subject line if email is used. To help the
                                                    harmed and in fact would benefit from                   proposed rule change does not: (i)                     Commission process and review your
                                                    the removal of complex functionality.                   Significantly affect the protection of                 comments more efficiently, please use
                                                    The Exchange also believes that                         investors or the public interest; (ii)                 only one method. The Commission will
                                                    eliminating Price Improving Orders and                  impose any significant burden on                       post all comments on the Commission’s
                                                    Quotes would benefit investors and add                  competition; and (iii) become operative                Internet Web site (http://www.sec.gov/
                                                    transparency and clarity to the                         prior to 30 days from the date on which                rules/sro.shtml). Copies of the
                                                    Exchange’s rules because the                            it was filed, or such shorter time as the              submission, all subsequent
                                                    functionality of those order types was                  Commission may designate, if                           amendments, all written statements
                                                    not implemented and therefore is not                    consistent with the protection of                      with respect to the proposed rule
                                                    available. The Exchange further believes                investors and the public interest, the                 change that are filed with the
                                                                                                            proposed rule change has become                        Commission, and all written
                                                    NYSEArca–2008–69) (notice of filing and                 effective pursuant to Section 19(b)(3)(A)              communications relating to the
                                                    immediate effectiveness of proposed rule change to                                                             proposed rule change between the
                                                    permit use of a new order type known as Price
                                                                                                            of the Act and Rule 19b–4(f)(6)(iii)
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    Improving Orders and Quotes).                           thereunder.                                            Commission and any person, other than
                                                      7 An affiliated Exchange recently eliminated Price       A proposed rule change filed under                  those that may be withheld from the
                                                    Improving Orders and Quotes. See Securities             Rule 19b–4(f)(6) 12 normally does not                  public in accordance with the
                                                    Exchange Act Release No. 34–79875 (January 30,          become operative prior to 30 days after                provisions of 5 U.S.C. 552, will be
                                                    2017), 82 FR 9256 (February 3, 2017) (SR–
                                                    NYSEMKT–2017–03) (notice of filing and                  the date of the filing. However, pursuant              available for Web site viewing and
                                                    immediate effectiveness of proposed rule change                                                                printing in the Commission’s Public
                                                    amending rules).                                          10 15 U.S.C. 78s(b)(3)(A)(iii).
                                                      8 15 U.S.C. 78f(b).                                     11 17 CFR 240.19b–4(f)(6).                             13 17   CFR 240.19b–4(f)(6)(iii).
                                                      9 15 U.S.C. 78f(b)(5).                                  12 17 CFR 240.19b–4(f)(6).                             14 15   U.S.C. 78s(b)(2)(B).



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                                                    11676                          Federal Register / Vol. 82, No. 36 / Friday, February 24, 2017 / Notices

                                                    Reference Room, 100 F Street NE.,                       registered under Section 6 of the Act 3               reference to the relevant Exchange Rule.
                                                    Washington, DC 20549 on official                        on February 6, 2017.4 The Exchange                    The Exchange notes that other
                                                    business days between the hours of                      proposes to establish its Fee Schedule.               exchanges have Definitions sections in
                                                    10:00 a.m. and 3:00 p.m. Copies of the                  The Exchange initially filed the                      their respective fee schedule,5 and the
                                                    filing also will be available for                       proposal on February 3, 2017 (SR–                     Exchange believes that including a
                                                    inspection and copying at the principal                 PEARL–2017–08). That filing has been                  Definitions section in the front of the
                                                    office of the Exchange. All comments                    withdrawn and replaced with the                       Exchange’s Fee Schedule makes the Fee
                                                    received will be posted without change;                 current filing (SR–PEARL–2017–10).                    Schedule more user-friendly.
                                                    the Commission does not edit personal                      The text of the proposed rule change               i. Transaction Rebates/Fees
                                                    identifying information from                            is available on the Exchange’s Web site
                                                    submissions. You should submit only                     at http://www.miaxoptions.com/rule-                      The proposed Fee Schedule sets forth
                                                    information that you wish to make                       filings/pearl, at MIAX PEARL’s                        transaction rebates and fees for all
                                                    available publicly. All submissions                     principal office, and at the                          options traded on the Exchange in
                                                    should refer to File Number SR–                         Commission’s Public Reference Room.                   amounts that vary depending upon
                                                    NYSEArca–2017–16 and should be                                                                                certain factors, including the type of
                                                    submitted on or before March 17, 2017.                  II. Self-Regulatory Organization’s                    market participant for whom the
                                                                                                            Statement of the Purpose of, and                      transaction is executed (e.g. Market
                                                      For the Commission, by the Division of                Statutory Basis for, the Proposed Rule
                                                    Trading and Markets, pursuant to delegated                                                                    Maker or Priority Customer) and the
                                                    authority.15                                            Change                                                amount of volume executed by the
                                                    Eduardo A. Aleman,                                        In its filing with the Commission, the              Member, as described more fully below.
                                                    Assistant Secretary.                                    Exchange included statements                          Exchange Add/Remove Tiered Rebates/
                                                    [FR Doc. 2017–03572 Filed 2–23–17; 8:45 am]             concerning the purpose of and basis for               Fees
                                                                                                            the proposed rule change and discussed
                                                    BILLING CODE 8011–01–P
                                                                                                            any comments it received on the                          In general, the Exchange proposes that
                                                                                                            proposed rule change. The text of these               Add/Remove Tiered Rebates/Fees
                                                                                                            statements may be examined at the                     applicable to all market participants
                                                    SECURITIES AND EXCHANGE                                                                                       will be based upon the total monthly
                                                    COMMISSION                                              places specified in Item IV below. The
                                                                                                            Exchange has prepared summaries, set                  volume executed by the Member 6 on
                                                    [Release No. 34–80061; File No. SR–
                                                                                                            forth in sections A, B, and C below, of               MIAX PEARL in the relevant origin type
                                                    PEARL–2017–10]                                                                                                (not including Excluded Contracts) 7
                                                                                                            the most significant aspects of such
                                                                                                            statements.                                           expressed as a percentage of total
                                                    Self-Regulatory Organizations; MIAX                                                                           consolidated volume (‘‘TCV’’). TCV,
                                                    PEARL, LLC; Notice of Filing and                        A. Self-Regulatory Organization’s                     which is defined in the Definitions
                                                    Immediate Effectiveness of a Proposed                   Statement of the Purpose of, and                      section of the Fee Schedule, means total
                                                    Rule Change To Establish the MIAX                       Statutory Basis for, the Proposed Rule                consolidated volume calculated as the
                                                    PEARL Fee Schedule                                      Change                                                total national volume in those classes
                                                    February 17, 2017.                                      1. Purpose                                            listed on MIAX PEARL for the month
                                                       Pursuant to the provisions of Section                                                                      for which the fees apply, excluding
                                                    19(b)(1) of the Securities Exchange Act                   The purpose of the proposed rule                    consolidated volume executed during
                                                    of 1934 (‘‘Act’’) 1 and Rule 19b–4                      change is to establish transaction rebates            the period time in which the Exchange
                                                    thereunder,2 notice is hereby given that                and fees, regulatory fees, and certain                experiences an ‘‘Exchange System
                                                    on February 13, 2017, MIAX PEARL,                       non-transaction fees applicable to                    Disruption’’ (solely in the option classes
                                                    LLC (‘‘MIAX PEARL’’ or ‘‘Exchange’’)                    market participants trading options on                of the affected Matching Engine (as
                                                    filed with the Securities and Exchange                  and/or using services provided by the                 defined below)). The term Exchange
                                                    Commission (‘‘Commission’’) a                           Exchange. These rebates and fees will                 System Disruption, which is defined in
                                                    proposed rule change as described in                    apply to all market participants trading              the Definitions section of the Fee
                                                    Items I, II, and III below, which Items                 options on and/or using services                      Schedule, means an outage of a
                                                    have been prepared by the Exchange.                     provided by MIAX PEARL.                               Matching Engine or collective Matching
                                                    The Commission is publishing this                       Definitions                                           Engines for a period of two consecutive
                                                    notice to solicit comments on the                                                                             hours or more, during trading hours.
                                                                                                              The Exchange has included a                         The term Matching Engine, which is
                                                    proposed rule change from interested
                                                                                                            Definitions section at the beginning of               also defined in the Definitions section of
                                                    persons.
                                                                                                            the Fee Schedule. The purpose of the                  the Fee Schedule, is a part of the MIAX
                                                    I. Self-Regulatory Organization’s                       Definitions section is to streamline the              PEARL electronic system that processes
                                                    Statement of the Terms of Substance of                  Fee Schedule by placing many of the                   options orders and trades on a symbol-
                                                    the Proposed Rule Change                                defined terms used in the Fee Schedule                by-symbol basis. Some Matching
                                                       The Exchange is filing a proposal to                 in one location at the beginning of the               Engines will process option classes with
                                                    establish the MIAX PEARL Fee                            Fee Schedule. Many of the defined
                                                    Schedule (the ‘‘Fee Schedule’’) by                      terms are also defined in Exchange                       5 See Exchange Act Release Nos. 70200 (August

                                                    adopting rebates and fees applicable to                 Rules, particularly in Exchange Rule                  14, 2013), 78 FR 51242 (August 20, 2013) (SR–
                                                                                                            100. Any defined terms that are also                  Topaz–2013–10); 76453 (November 17, 2015), 80 FR
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    participants trading options on and/or                                                                        72999 (November 23, 2015) (SR–EDGX–2015–56).
                                                    using services provided by MIAX                         defined or otherwise explained in                        6 ‘‘Member’’ means an individual or organization

                                                    PEARL.                                                  Exchange Rules contain a cross                        that is registered with the Exchange pursuant to
                                                       MIAX PEARL commenced operations                                                                            Chapter II of the Exchange Rules for purposes of
                                                                                                              3 15 U.S.C. 78f.                                    trading on the Exchange as an ‘‘Electronic Exchange
                                                    as a national securities exchange                         4 See                                               Member’’ or ‘‘Market Maker.’’ Members are deemed
                                                                                                                    Securities Exchange Act Release No. 79543
                                                                                                            (December 13, 2016), 81 FR 92901 (December 20,        ‘‘members’’ under the Exchange Act. See Exchange
                                                      15 17 CFR 200.30–3(a)(12).                            2016) (File No. 10–227) (order approving              Rule 100.
                                                      1 15 U.S.C. 78s(b)(1).                                application of MIAX PEARL, LLC for registration as       7 ‘‘Excluded Contracts’’ means any contracts
                                                      2 17 CFR 240.19b–4.                                   a national securities exchange).                      routed to an away market for execution.



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Document Created: 2017-02-24 01:17:08
Document Modified: 2017-02-24 01:17:08
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 Citation82 FR 11674 

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