82 FR 16456 - Self-Regulatory Organizations: Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Correct Typographical Errors in SR-IEX-2017-06

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 63 (April 4, 2017)

Page Range		16456-16458
FR Document		2017-06566

Federal Register, Volume 82 Issue 63 (Tuesday, April 4, 2017)

[Federal Register Volume 82, Number 63 (Tuesday, April 4, 2017)]
[Notices]
[Pages 16456-16458]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2017-06566]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80331; File No. SR-IEX-2017-08]

Self-Regulatory Organizations: Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Correct
Typographical Errors in SR-IEX-2017-06

March 29, 2017.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, on
March 17, 2017, the Investors Exchange LLC filed with the Securities
and Exchange Commission (``Commission'') the proposed rule change as
described in Items I and II below, which Items have been prepared by
the self-regulatory organization. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
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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

Pursuant to the provisions of Section 19(b)(1) under the Securities
Exchange Act of 1934 (``Act''),\4\ and Rule 19b-4 thereunder,\5\
Investors Exchange LLC (``IEX'' or ``Exchange'') is filing with the
Commission a proposed rule change to correct several typographical
errors in Rule 11.190(g)(1)(A) and in the Purpose Section of SR-IEX-
2017-06 describing the changes to IEX Rule 11.190(g)(1)(A) proposed
therein. The Exchange has designated this proposal as non-controversial
and has satisfied the requirements of Rule 19b-4(f)(6)(iii) under the
Act.\6\
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\4\ 15 U.S.C. 78s(b)(1).
\5\ 17 CFR 240.19b-4.
\6\ 17 CFR 240.19b-4(f)(6)(iii).
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The text of the proposed rule change is available at the Exchange's
Web site at www.iextrading.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 these statement may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in Sections A, B, and C below, of the
most significant aspects of such statements.

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

1. Purpose
The Exchange recently filed with the Commission an immediately
effective proposed rule change to amend Rule 11.190(g) to modify the
quote instability coefficients and quote instability threshold included
in the quote instability calculation specified in subparagraph (g)(1)
of Rule 11.190 for purposes of determining whether a crumbling quote
exists. The rule filing was published on the Commission Web site on
March 10, 2017.\7\ Thereafter the Exchange identified that the formula
contained in Rule 11.190(g)(1)(A) (the ``formula'') contains several
minor typographical errors. First, the numerical references to the
Quote Stability Coefficients contained in the formula were each
represented as regular text rather than as subscript, as they are
specified in subparagraph (a) of Rule 11.190(g)(1)(A). Second, the
Quote Stability Variables NC and FC are incorrectly represented as NC-1
and FC-1 respectively in the formula. Exhibit 5 to this filing corrects
both of these typographical errors. In addition, Exhibit 5 to SR-IEX-
2017-06 contains inconsistent notations on text marked for deletion and
retention whereby the same phrase is marked for deletion and also
marked as retained and relocated in the following subparagraph.
Specifically, the phrase ``the quote instability factor result from the
quote stability calculation is greater than the defined quote
instability threshold'' is not clearly shown as relocated. Exhibit 5 to
this rule filing corrects this typographical error by showing the text
of the relocated phrase as new text, notwithstanding that it was
previously contained in the text of Rule

[[Page 16457]]

1.190(g)(1)(A) [sic] as amended by SR-IEX-2017-06.
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\7\ See Securities Exchange Act Release No. 34-80202; File No.
SR-IEX-2017-06.
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In addition, the Purpose Section of the filing contains two sets of
typographical errors which the Exchange proposes to correct with this
filing. First, numbered paragraph 1, beginning on page 8, which
describes one aspect of the proposed amendments to Rule 11.190(g)
inadvertently omits the Nasdaq Stock Market in the list of exchanges
for which protected quotations are included in the Crumbling Quote
determination described in subparagraph (1) of Rule 11.190(g). This
paragraph also uses the word ``protection'' rather than ``protected''
in the second sentence. The proposed rule text in Exhibit 5 to the rule
filing is correct in this respect. Accordingly, IEX proposes to restate
the relevant portion of the Purpose Section to read as follows:

1. Rule 11.190(g) states that the Exchange utilizes real time
relative quoting activity of Protected Quotations, not including IEX
protected quotations, in the quote instability calculation. As
proposed, the Exchange is proposing to include the protected
quotations of the following exchanges in the quote instability
calculation: New York Stock Exchange, NYSE Arca, Nasdaq Stock
Market, Nasdaq BX, Bats BZX Exchange, Bats BYX Exchange, Bats EDGX
Exchange, and Bats EDGA Exchange. In connection with our analysis of
market data, as described above, the Exchange considered several
different permutations of which exchanges to include in the model.
The research identified that using the Protected Quotations of these
specific eight exchanges in the aggregate resulted in the greatest
predictive power of all permutations of exchanges assessed for
determining a crumbling quote.

Second, the description in the Purpose Section of the filing in the
first and third sentences of numbered paragraph 3 on page 10, which
reference the quote stability variables to be retired, incorrectly
format N-1 and F-1 in regular text, when the
numeral 1 and preceding minus sign in each should be subscript.
Accordingly, IEX proposes to restate the first three sentences of the
paragraph to read as follows:

The Exchange proposes to revise the quote stability variables
currently specified in subparagraph (1)(D)(i)(b) of Rule 11.190(g)
by adding seven (7) new variables (NC, FC, Delta, EPos, ENeg,
EPosPrev, and ENegPrev) and retiring four (4) variables
(N-1, F-1, E, and D). Specifically, based on
our analysis of market data, as described above, the Exchange
identified that considering the maximum change over the course of
the previous millisecond up to the most recent Protected NBBO change
was a more accurate indicator of a crumbling quote than simply
looking at the absolute state of the market one millisecond
previously. The replacement of N-1, F-1, and D
with NC, FC, and Delta, respectively, reflects this finding.''
(internal footnote omitted)
2. Statutory Basis
IEX believes that the proposed rule change is consistent with
Section 6(b) of the Act \8\ in general, and furthers the objectives of
Section 6(b)(5) of the Act,\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, to remove impediments to and perfect the mechanism of a
free and open market and a national market system and, in general, to
protect investors and the public interest. Specifically, the correction
of inadvertent typographical errors in IEX Rule 11.190(g)(1)(A) and in
SR-IEX-2017-06 describing the changes to IEX Rule 11.190(g)(1)(A)
proposed therein will serve the goals of the Act by having rule text
accurately reflect system functionality and avoid the potential for
market participant confusion.
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\8\ 15 U.S.C. 78f.
\9\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

IEX 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. The Exchange believes that the
proposed correction does not impact competition in any respect since it
is designed to correct typographical errors.

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

Written comments were neither solicited nor received.

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

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 for 30
days from the date on which it was filed, or such shorter time as the
Commission may designate, it has become effective pursuant to Section
19(b)(3)(A) of the Act \10\ and Rule 19b-4(f)(6) thereunder.\11\
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\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), IEX provided the Commission with written notice of its
intent to file the proposed rule change, along with a brief
description and the text of the proposed rule change, at least five
business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission.
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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. The Exchange has asked
the Commission to waive the 30-day operative delay, noting that the
proposal would correct typographical errors in SR-IEX-2017-06, and
stating that waiver would allow the Exchange to implement these
corrections upon effectiveness of the proposal and avoid potential
confusion that otherwise might occur. The Commission believes that
waiver of the 30-day operative delay is consistent with the protection
of investors and the public interest because the proposed rule change
would correct a number of typographical errors contained in IEX's
recent SR-IEX-2017-06 filing, but would not result in any substantive
changes to that proposal. Waiver of the operative delay will allow IEX
to correct these errors without delay, which should reduce the
potential for confusion regarding the operation of IEX's quote
instability calculation referenced in IEX Rule 11.190. Therefore, the
Commission hereby waives the operative delay and designates the
proposed rule change operative upon filing.\14\
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\12\ 17 CFR 240.19b-4(f)(6).
\13\ 17 CFR 240.19b-4(f)(6)(iii).
\14\ For purposes only of waiving the 30-day operative delay,
the Commission has also considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act.

[[Page 16458]]

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 rule-comments@sec.gov. Please include
File SR-IEX-2017-08 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-IEX-2017-08. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-IEX-2017-08 and should be
submitted on or before April 25, 2017.
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\15\ 17 CFR 200.30-3(a)(12).

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-06566 Filed 4-3-17; 8:45 am]
BILLING CODE 8011-01-P

16456 Federal Register / Vol. 82, No. 63 / Tuesday, April 4, 2017 / Notices

(A) By order approve or disapprove For the Commission, pursuant to delegated II. Self-Regulatory Organization’s
such proposed rule change, or authority.35 Statement of the Purpose of, and
(B) institute proceedings to determine Eduardo A. Aleman, Statutory Basis for, the Proposed Rule
whether the proposed rule change Assistant Secretary. Change
should be disapproved. [FR Doc. 2017–06562 Filed 4–3–17; 8:45 am] In its filing with the Commission, the
IV. Solicitation of Comments BILLING CODE 8011–01–P self-regulatory organization included
statements concerning the purpose of
Interested persons are invited to and basis for the proposed rule change
submit written data, views, and SECURITIES AND EXCHANGE and discussed any comments it received
arguments concerning the foregoing, COMMISSION on the proposed rule change. The text
including whether the proposed rule of these statement may be examined at
change is consistent with the Act. [Release No. 34–80331; File No. SR–IEX– the places specified in Item IV below.
Comments may be submitted by any of 2017–08] The self-regulatory organization has
the following methods: prepared summaries, set forth in
Self-Regulatory Organizations: Sections A, B, and C below, of the most
Electronic Comments Investors Exchange LLC; Notice of significant aspects of such statements.
• Use the Commission’s Internet Filing and Immediate Effectiveness of
A. Self-Regulatory Organization’s
comment form (http://www.sec.gov/ Proposed Rule Change To Correct
Statement of the Purpose of, and
rules/sro.shtml); or Typographical Errors in SR–IEX–2017–
Statutory Basis for, the Proposed Rule
• Send an email to rule-comments@ 06
Change
sec.gov. Please include File Number SR– March 29, 2017.
MSRB–2017–02 on the subject line. 1. Purpose
Pursuant to Section 19(b)(1) 1 of the The Exchange recently filed with the
Paper Comments Securities Exchange Act of 1934 2 and Commission an immediately effective
Rule 19b–4 thereunder,3 notice is
• Send paper comments in triplicate proposed rule change to amend Rule
hereby given that, on March 17, 2017, 11.190(g) to modify the quote instability
to Secretary, Securities and Exchange
the Investors Exchange LLC filed with coefficients and quote instability
Commission, 100 F Street NE.,
the Securities and Exchange threshold included in the quote
Washington, DC 20549.
Commission (‘‘Commission’’) the instability calculation specified in
All submissions should refer to File proposed rule change as described in subparagraph (g)(1) of Rule 11.190 for
Number SR–MSRB–2017–02. This file Items I and II below, which Items have purposes of determining whether a
number should be included on the been prepared by the self-regulatory crumbling quote exists. The rule filing
subject line if email is used. To help the organization. The Commission is was published on the Commission Web
Commission process and review your publishing this notice to solicit site on March 10, 2017.7 Thereafter the
comments more efficiently, please use comments on the proposed rule change Exchange identified that the formula
only one method. The Commission will from interested persons. contained in Rule 11.190(g)(1)(A) (the
post all comments on the Commission’s
I. Self-Regulatory Organization’s ‘‘formula’’) contains several minor
Internet Web site (http://www.sec.gov/
Statement of the Terms of Substance of typographical errors. First, the
rules/sro.shtml). Copies of the
the Proposed Rule Change numerical references to the Quote
submission, all subsequent
Stability Coefficients contained in the
amendments, all written statements Pursuant to the provisions of Section formula were each represented as
with respect to the proposed rule 19(b)(1) under the Securities Exchange regular text rather than as subscript, as
change that are filed with the Act of 1934 (‘‘Act’’),4 and Rule 19b–4 they are specified in subparagraph (a) of
Commission, and all written thereunder,5 Investors Exchange LLC Rule 11.190(g)(1)(A). Second, the Quote
communications relating to the (‘‘IEX’’ or ‘‘Exchange’’) is filing with the Stability Variables NC and FC are
proposed rule change between the Commission a proposed rule change to incorrectly represented as NC–1 and
Commission and any person, other than correct several typographical errors in FC–1 respectively in the formula.
those that may be withheld from the Rule 11.190(g)(1)(A) and in the Purpose Exhibit 5 to this filing corrects both of
public in accordance with the Section of SR–IEX–2017–06 describing these typographical errors. In addition,
provisions of 5 U.S.C. 552, will be the changes to IEX Rule 11.190(g)(1)(A) Exhibit 5 to SR–IEX–2017–06 contains
available for Web site viewing and proposed therein. The Exchange has inconsistent notations on text marked
printing in the Commission’s Public designated this proposal as non- for deletion and retention whereby the
Reference Room, 100 F Street NE., controversial and has satisfied the same phrase is marked for deletion and
Washington, DC 20549 on official requirements of Rule 19b–4(f)(6)(iii) also marked as retained and relocated in
business days between the hours of under the Act.6 the following subparagraph.
10:00 a.m. and 3:00 p.m. Copies of the
The text of the proposed rule change Specifically, the phrase ‘‘the quote
filing also will be available for
is available at the Exchange’s Web site instability factor result from the quote
inspection and copying at the principal
at www.iextrading.com, at the principal stability calculation is greater than the
office of the MSRB. All comments
office of the Exchange, and at the defined quote instability threshold’’ is
received will be posted without change;
asabaliauskas on DSK3SPTVN1PROD with NOTICES

Commission’s Public Reference Room. not clearly shown as relocated. Exhibit
the Commission does not edit personal
5 to this rule filing corrects this
identifying information from
35 17 CFR 200.30–3(a)(12). typographical error by showing the text
submissions. You should submit only
1 15 U.S.C. 78s(b)(1). of the relocated phrase as new text,
information that you wish to make 2 15 U.S.C. 78a. notwithstanding that it was previously
available publicly. All submissions 3 17 CFR 240.19b–4. contained in the text of Rule
should refer to File Number SR–MSRB– 4 15 U.S.C. 78s(b)(1).
2017–02 and should be submitted on or 5 17 CFR 240.19b–4. 7 See Securities Exchange Act Release No. 34–
before April 25, 2017. 6 17 CFR 240.19b–4(f)(6)(iii). 80202; File No. SR–IEX–2017–06.

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Federal Register / Vol. 82, No. 63 / Tuesday, April 4, 2017 / Notices 16457

1.190(g)(1)(A) [sic] as amended by SR– respectively, reflects this finding.’’ (internal A proposed rule change filed under
IEX–2017–06. footnote omitted) Rule 19b–4(f)(6) 12 normally does not
In addition, the Purpose Section of 2. Statutory Basis become operative prior to 30 days after
the filing contains two sets of the date of the filing. However, pursuant
typographical errors which the IEX believes that the proposed rule to Rule 19b–4(f)(6)(iii),13 the
Exchange proposes to correct with this change is consistent with Section 6(b) of Commission may designate a shorter
filing. First, numbered paragraph 1, the Act 8 in general, and furthers the time if such action is consistent with the
beginning on page 8, which describes objectives of Section 6(b)(5) of the Act,9 protection of investors and the public
one aspect of the proposed amendments in particular, in that it is designed to interest. The Exchange has asked the
to Rule 11.190(g) inadvertently omits prevent fraudulent and manipulative Commission to waive the 30-day
the Nasdaq Stock Market in the list of acts and practices, to promote just and operative delay, noting that the proposal
exchanges for which protected equitable principles of trade, to foster would correct typographical errors in
quotations are included in the cooperation and coordination with SR–IEX–2017–06, and stating that
Crumbling Quote determination persons engaged in facilitating waiver would allow the Exchange to
described in subparagraph (1) of Rule transactions in securities, to remove implement these corrections upon
11.190(g). This paragraph also uses the impediments to and perfect the effectiveness of the proposal and avoid
word ‘‘protection’’ rather than mechanism of a free and open market potential confusion that otherwise
‘‘protected’’ in the second sentence. The and a national market system and, in might occur. The Commission believes
proposed rule text in Exhibit 5 to the general, to protect investors and the that waiver of the 30-day operative
rule filing is correct in this respect. public interest. Specifically, the delay is consistent with the protection
Accordingly, IEX proposes to restate the correction of inadvertent typographical of investors and the public interest
relevant portion of the Purpose Section errors in IEX Rule 11.190(g)(1)(A) and in because the proposed rule change
to read as follows: SR–IEX–2017–06 describing the changes would correct a number of
to IEX Rule 11.190(g)(1)(A) proposed typographical errors contained in IEX’s
1. Rule 11.190(g) states that the Exchange therein will serve the goals of the Act by
utilizes real time relative quoting activity of recent SR–IEX–2017–06 filing, but
Protected Quotations, not including IEX
having rule text accurately reflect would not result in any substantive
protected quotations, in the quote instability system functionality and avoid the changes to that proposal. Waiver of the
calculation. As proposed, the Exchange is potential for market participant operative delay will allow IEX to correct
proposing to include the protected quotations confusion. these errors without delay, which
of the following exchanges in the quote
instability calculation: New York Stock B. Self-Regulatory Organization’s should reduce the potential for
Exchange, NYSE Arca, Nasdaq Stock Market, Statement on Burden on Competition confusion regarding the operation of
Nasdaq BX, Bats BZX Exchange, Bats BYX IEX does not believe that the IEX’s quote instability calculation
Exchange, Bats EDGX Exchange, and Bats proposed rule change will result in any referenced in IEX Rule 11.190.
EDGA Exchange. In connection with our burden on competition that is not Therefore, the Commission hereby
analysis of market data, as described above, waives the operative delay and
the Exchange considered several different necessary or appropriate in furtherance
of the purposes of the Act. The designates the proposed rule change
permutations of which exchanges to include operative upon filing.14
in the model. The research identified that Exchange believes that the proposed
using the Protected Quotations of these correction does not impact competition At any time within 60 days of the
specific eight exchanges in the aggregate in any respect since it is designed to filing of the proposed rule change, the
resulted in the greatest predictive power of correct typographical errors. Commission summarily may
all permutations of exchanges assessed for temporarily suspend such rule change if
determining a crumbling quote. C. Self-Regulatory Organization’s it appears to the Commission that such
Statement on Comments on the action is necessary or appropriate in the
Second, the description in the
Proposed Rule Change Received From public interest, for the protection of
Purpose Section of the filing in the first
Members, Participants, or Others investors, or otherwise in furtherance of
and third sentences of numbered
paragraph 3 on page 10, which reference Written comments were neither the purposes of the Act. If the
the quote stability variables to be solicited nor received. Commission takes such action, the
retired, incorrectly format N¥1 and F¥1 Commission shall institute proceedings
III. Date of Effectiveness of the to determine whether the proposed rule
in regular text, when the numeral 1 and Proposed Rule Change and Timing for
preceding minus sign in each should be should be approved or disapproved.
Commission Action
subscript. Accordingly, IEX proposes to IV. Solicitation of Comments
restate the first three sentences of the Because the proposed rule change
paragraph to read as follows: does not: (i) Significantly affect the Interested persons are invited to
protection of investors or the public submit written data, views and
The Exchange proposes to revise the quote interest; (ii) impose any significant arguments concerning the foregoing,
stability variables currently specified in burden on competition; and (iii) become including whether the proposed rule
subparagraph (1)(D)(i)(b) of Rule 11.190(g) by
adding seven (7) new variables (NC, FC,
operative for 30 days from the date on change is consistent with the Act.
Delta, EPos, ENeg, EPosPrev, and ENegPrev) which it was filed, or such shorter time
and retiring four (4) variables (N¥1, F¥1, E, as the Commission may designate, it has change, along with a brief description and the text
and D). Specifically, based on our analysis of become effective pursuant to Section of the proposed rule change, at least five business
asabaliauskas on DSK3SPTVN1PROD with NOTICES

market data, as described above, the 19(b)(3)(A) of the Act 10 and Rule 19b– days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
Exchange identified that considering the 4(f)(6) thereunder.11 Commission.
maximum change over the course of the 12 17 CFR 240.19b–4(f)(6).
previous millisecond up to the most recent 8 15 U.S.C. 78f. 13 17 CFR 240.19b–4(f)(6)(iii).
Protected NBBO change was a more accurate 9 15 U.S.C. 78f(b)(5). 14 For purposes only of waiving the 30-day
indicator of a crumbling quote than simply 10 15 U.S.C. 78s(b)(3)(A).
operative delay, the Commission has also
looking at the absolute state of the market 11 17 CFR 240.19b–4(f)(6). As required under Rule considered the proposed rule’s impact on
one millisecond previously. The replacement 19b–4(f)(6)(iii), IEX provided the Commission with efficiency, competition, and capital formation. See
of N¥1, F¥1, and D with NC, FC, and Delta, written notice of its intent to file the proposed rule 15 U.S.C. 78c(f).

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16458 Federal Register / Vol. 82, No. 63 / Tuesday, April 4, 2017 / Notices

Comments may be submitted by any of SECURITIES AND EXCHANGE (i) Except as provided for in Rule
the following methods: COMMISSION 36.30,6 may trade only DMM securities
only on or through the systems and
Electronic Comments [Release No. 34–80334; File No. SR–NYSE–
facilities of the Exchange as permitted
2017–03]
• Use the Commission’s Internet by Exchange rules.
comment form (http://www.sec.gov/ Self-Regulatory Organizations; New (ii) except as provided for in Rule
rules/sro.shtml); or York Stock Exchange LLC; Order 36.30, may not communicate with
Approving Proposed Rule Change individuals or systems responsible for
• Send an email to rule-comments@ Amending Rule 98 making trading decisions for related
sec.gov. Please include File SR–IEX– products or for away-market trading in
2017–08 on the subject line. March 29, 2017. their assigned DMM securities.
Paper Comments I. Introduction (iii) shall not have access to customer
information or the DMM unit’s position
On January 26, 2017, New York Stock
• Send paper comments in triplicate Exchange LLC (‘‘Exchange’’ or ‘‘NYSE’’)
in related products.
to Secretary, Securities and Exchange Accordingly, under current Rule 98,
filed with the Securities and Exchange
Commission, 100 F Street NE., while on the Trading Floor, DMMs may
Commission (‘‘Commission’’), pursuant
Washington, DC 20549–1090. only trade DMM securities and, thus,
to Section 19(b)(1) of the Securities
may not trade any other securities,
All submissions should refer to File Exchange Act of 1934 (‘‘Act’’) 1 and Rule
including securities that are related
Number SR–IEX–2017–08. This file 19b–4 thereunder,2 a proposed rule
products to their DMM securities.
number should be included on the change to amend NYSE Rule 98. The
subject line if email is used. To help the proposed rule change was published for B. Proposed Rule Change
Commission process and review your comment in the Federal Register on The Exchange proposes to amend
February 16, 2017.3 The Commission Rule 98 to remove restrictions on DMM
comments more efficiently, please use
received no comments on the proposed operations on the Trading Floor that are
only one method. The Commission will
rule change. The Commission is unrelated to the role of DMMs at the
post all comments on the Commission’s
approving the proposed rule change. Exchange. Specifically, as described in
Internet Web site (http://www.sec.gov/
rules/sro.shtml). Copies of the II. Description of the Proposal Rule 104, DMMs have specified
submission, all subsequent The Exchange proposes to amend obligations with respect to their DMM
amendments, all written statements Rule 98 to provide that, while on the securities and have access to specified
with respect to the proposed rule Trading Floor, DMMs must trade DMM non-public order information regarding
change that are filed with the securities at their assigned stock trading their DMM securities.7 However, the
Commission, and all written post location and may not trade any Exchange states that DMMs do not have
security that is a related product of their a unique role or access to any non-
communications relating to the
DMM securities.4 public order information with respect to
proposed rule change between the
securities that are not assigned to them
Commission and any person, other than A. Background under Rule 103B. The Exchange
those that may be withheld from the therefore believes that the current Rule
public in accordance with the Rule 98 governs the operation of a
DMM unit and paragraph (c)(3) of that 98 restrictions are unnecessarily broad.
provisions of 5 U.S.C. 552, will be Accordingly, the Exchange proposes
rule specifies restrictions on trading for
available for Web site viewing and to amend Rule 98(c)(3)(B)(i) to provide
member organizations operating a DMM
printing in the Commission’s Public unit. More specifically, Rule 98(c)(3)(B) that, while on the Trading Floor,
Reference Room, 100 F Street NE., provides that, while on the Trading employees of the DMM unit may trade
Washington, DC 20549, on official Floor of the Exchange,5 employees of DMM securities only on or through the
business days between the hours of the DMM unit: systems and facilities of the Exchange at
10:00 a.m. and 3:00 p.m. Copies of the the DMM unit’s assigned stock trading
filing also will be available for 1 15 U.S.C. 78s(b)(1). post location and as permitted by
inspection and copying at the principal 2 17 CFR 240.19b–4. Exchange rules. Because the proposed
office of the Exchange. All comments 3 See Securities Exchange Act Release No. 80019
rule would no longer specify the only
received will be posted without change; (Feb. 10, 2017), 82 FR 10942 (Feb. 16, 2017). securities that a DMM is permitted to
4 As defined in Rule 2(i), the term ‘‘DMM’’ means
the Commission does not edit personal an individual member, officer, partner, employee or
trade, the Exchange proposes to delete
identifying information from associated person of a Designated Market Maker
submissions. You should submit only Unit who is approved by the Exchange to act in the are traded, which, for the purposes of the
capacity of a DMM. The term ‘‘DMM securities’’ is Exchange’s Rules, is referred to as the ‘‘NYSE Amex
information that you wish to make Options Trading Floor’’ or (ii) the physical area
defined in Rule 98(a)(2) to mean any securities
available publicly. All submissions allocated to the DMM unit pursuant to Rule 103B within fully enclosed telephone booths located in
should refer to File Number SR–IEX– or other applicable rules. The term ‘‘related 18 Broad Street at the Southeast wall of the Trading
2017–08 and should be submitted on or products’’ is defined in Rule 98(a)(7) to mean any Floor.
derivative instrument that is related to a DMM 6 Rule 36.30 permits a DMM unit that is registered
before April 25, 2017. security, including options, warrants, hybrid in an Investment Company Unit (as defined in
For the Commission, by the Division of securities, single-stock futures, security-based swap Section 703.16 of the Listed Company Manual) or
agreement, a forward contract, or any other a Trust Issued Receipt (as that term is defined in
asabaliauskas on DSK3SPTVN1PROD with NOTICES

Trading and Markets, pursuant to delegated
instrument that is exercisable into or whose price Rule 1200) to use a telephone connection or order
authority.15 is based upon or derived from a security traded at entry terminal at the DMM unit’s post to enter
Eduardo A. Aleman, the Exchange. proprietary orders in the Unit or receipt in another
5 As defined in Rule 6A, the term ‘‘Trading Floor’’ market center, in a Component Security of such a
Assistant Secretary. means the restricted-access physical areas Unit or receipt, or an options or futures contract
[FR Doc. 2017–06566 Filed 4–3–17; 8:45 am] designated by the Exchange for the trading of related to such Unit or receipt, and may use the
securities, commonly known as the ‘‘Main Room’’ post telephone to obtain market information with
BILLING CODE 8011–01–P
and the ‘‘Buttonwood Room’’ and does not include respect to such Units, receipts, options, futures or
(i) the areas in the ‘‘Buttonwood Room’’ designated Component Securities.
15 17 CFR 200.30–3(a)(12). by the Exchange where NYSE Amex-listed options 7 See, e.g., Rule 104(a) and (j).

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Document Created: 2017-04-03 23:53:29
Document Modified: 2017-04-03 23:53:29

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		82 FR 16456