82 FR 26729 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Pilot Period for the Exchange's Retail Liquidity Program Until December 31, 2017
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 109 (June 8, 2017)
Federal Register Volume 82, Issue 109 (June 8, 2017)
| Page Range | 26729-26731 | |
| FR Document | 2017-11866 |
[Federal Register Volume 82, Number 109 (Thursday, June 8, 2017)] [Notices] [Pages 26729-26731] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-11866] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-80850; File No. SR-NYSEMKT-2017-33] Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Pilot Period for the Exchange's Retail Liquidity Program Until December 31, 2017 June 2, 2017. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that on May 23, 2017, NYSE MKT LLC (the ``Exchange'' or ``NYSE MKT'') filed with the Securities and Exchange Commission (the ``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. --------------------------------------------------------------------------- \1\ 15 U.S.C.78s(b)(1). \2\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of the Substance of the Proposed Rule Change The Exchange proposes to extend the pilot period for the Exchange's Retail Liquidity Program (the ``Retail Liquidity Program'' or the ``Program''), which is currently scheduled to expire on June 30, 2017, until December 31, 2017. 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. [[Page 26730]] A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to extend the pilot period of the Retail Liquidity Program, currently scheduled to expire on June 30, 2017,\4\ until December 31, 2017. --------------------------------------------------------------------------- \4\ See Securities Exchange Act Release No. 79509 (December 8, 2016), 81 FR 90389 (December 14, 2016) (SR-NYSEMKT-2016-112). --------------------------------------------------------------------------- Background In July 2012, the Commission approved the Retail Liquidity Program on a pilot basis.\5\ The Program is designed to attract retail order flow to the Exchange, and allows such order flow to receive potential price improvement. The Program is currently limited to trades occurring at prices equal to or greater than $1.00 per share. Under the Program, Retail Liquidity Providers (``RLPs'') are able to provide potential price improvement in the form of a non-displayed order that is priced better than the Exchange's best protected bid or offer (``PBBO''), called a Retail Price Improvement Order (``RPI''). When there is an RPI in a particular security, the Exchange disseminates an indicator, known as the Retail Liquidity Identifier, indicating that such interest exists. Retail Member Organizations (``RMOs'') can submit a Retail Order to the Exchange, which would interact, to the extent possible, with available contra-side RPIs. --------------------------------------------------------------------------- \5\ See Securities Exchange Act Release No. 67347 (July 3, 2012), 77 FR 40673 (July 10, 2012) (``RLP Approval Order'') (SR- NYSEAmex-2011-84). --------------------------------------------------------------------------- The Retail Liquidity Program was approved by the Commission on a pilot basis. Pursuant to NYSE MKT Rule 107C(m)--Equities, the pilot period for the Program is scheduled to end on June 30, 2017. Proposal To Extend the Operation of the Program The Exchange established the Retail Liquidity Program in an attempt to attract retail order flow to the Exchange by potentially providing price improvement to such order flow. The Exchange believes that the Program promotes competition for retail order flow by allowing Exchange members to submit RPIs to interact with Retail Orders. Such competition has the ability to promote efficiency by facilitating the price discovery process and generating additional investor interest in trading securities, thereby promoting capital formation. The Exchange believes that extending the pilot is appropriate because it will allow the Exchange and the Commission additional time to analyze data regarding the Program that the Exchange has committed to provide.\6\ As such, the Exchange believes that it is appropriate to extend the current operation of the Program.\7\ Through this filing, the Exchange seeks to amend NYSE MKT Rule 107C(m)--Equities and extend the current pilot period of the Program until December 31, 2017. --------------------------------------------------------------------------- \6\ See id. at 40681. \7\ Concurrently with this filing, the Exchange has submitted a request for an extension of the exemption under Regulation NMS Rule 612 previously granted by the Commission that permits it to accept and rank the undisplayed RPIs. See Letter from Martha Redding, Asst. Corporate Secretary, NYSE Group, Inc. to Brent J. Fields, Secretary, Securities and Exchange Commission, dated May 23, 2017. --------------------------------------------------------------------------- 2. Statutory Basis 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),\9\ in particular, in that it is designed to promote just and equitable principles of trade, 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. The Exchange believes that extending the pilot period for the Retail Liquidity Program is consistent with these principles because the Program is reasonably designed to attract retail order flow to the exchange environment, while helping to ensure that retail investors benefit from the better price that liquidity providers are willing to give their orders. Additionally, as previously stated, the competition promoted by the Program may facilitate the price discovery process and potentially generate additional investor interest in trading securities. The extension of the pilot period will allow the Commission and the Exchange to continue to monitor the Program for its potential effects on public price discovery, and on the broader market structure. --------------------------------------------------------------------------- \8\ 15 U.S.C. 78f(b). \9\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change simply extends an established pilot program for an additional six months, thus allowing the Retail Liquidity Program to enhance competition for retail order flow and contribute to the public price discovery process. 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 19b4(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: [[Page 26731]] Electronic CommentsUse 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-NYSEMKT-2017-33 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-NYSEMKT-2017-33. 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-NYSEMKT-2017-33, and should be submitted on or before June 29, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\15\ --------------------------------------------------------------------------- \15\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-11866 Filed 6-7-17; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 82, No. 109 / Thursday, June 8, 2017 / Notices 26729
III. Discussion and Commission elimination of this component of LCH SECURITIES AND EXCHANGE
Findings SA’s margin is expected to have only a COMMISSION
Section 19(b)(2)(C) of the Act directs minor impact on the total amount of
the Commission to approve a proposed margin LCH SA collects with respect to [Release No. 34–80850; File No. SR–
rule change of a self-regulatory index CDS. Furthermore, the NYSEMKT–2017–33]
organization if it finds that such Commission notes that LCH SA will
proposed rule change is consistent with continue to consider and address Self-Regulatory Organizations; NYSE
the requirements of the Act and the recovery rate risk on index CDS in its MKT LLC; Notice of Filing and
rules and regulations thereunder stress scenarios used to size its default Immediate Effectiveness of Proposed
applicable to such organization.8 fund. Based on these findings and Rule Change To Extend the Pilot
Section 17A(b)(3)(F) of the Act considerations, the Commission Period for the Exchange’s Retail
requires,9 among other things, that the believes that the proposed rule change Liquidity Program Until December 31,
rules of a registered clearing agency be is reasonably designed to use margin 2017
designed to assure the safeguarding of requirements to limit its credit
securities and funds which are in the June 2, 2017.
exposures to participants under normal
custody or control of the clearing agency market conditions, calculate margin Pursuant to Section 19(b)(1) 1 of the
or for which it is responsible. Rule Securities Exchange Act of 1934 (the
sufficient to cover its potential future
17Ad–22(b)(2) requires that a registered ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
exposure to participants in the interval
clearing agency that performs central notice is hereby given that on May 23,
counterparty services shall establish, between the last margin collection and
the close out of positions following a 2017, NYSE MKT LLC (the ‘‘Exchange’’
implement, maintain, and enforce
participant default and use an or ‘‘NYSE MKT’’) filed with the
written policies and procedures
reasonably designed to use margin appropriate method for measuring credit Securities and Exchange Commission
requirements to limit its credit exposure that accounts for relevant (the ‘‘Commission’’) the proposed rule
exposures to participants under normal product risk factors and portfolio effects change as described in Items I, II, and
market conditions.10 Rule 17Ad– across products, consistent with Section III below, which Items have been
22(e)(6) requires that a covered clearing 17A(b)(3)(F) of the Exchange Act,14 and prepared by the self-regulatory
agency 11 shall establish, implement, Rules 17Ad–22(b)(2), (e)(6)(iii), and organization. The Commission is
maintain, and enforce written policies (e)(6)(v) thereunder.15 publishing this notice to solicit
and procedures reasonably designed to comments on the proposed rule change
With respect to the portion of the
cover its credit exposures to its from interested persons.
proposed rule change that revises the
participants by establishing a risk-based
Reference Guide to (i) correct a I. Self-Regulatory Organization’s
margin system that, at a minimum,
hyperlink and (ii) add a cross reference Statement of the Terms of the Substance
calculates margin sufficient to cover its
and hyperlink to the general inputs of the Proposed Rule Change
potential future exposure to participants
in the interval between the last margin considered by LCH SA in constructing
the CDS pricing for European and U.S. The Exchange proposes to extend the
collection and the close out of positions pilot period for the Exchange’s Retail
following a participant default and uses dollar denominated contracts, the
Commission believes that correcting an Liquidity Program (the ‘‘Retail Liquidity
an appropriate method for measuring Program’’ or the ‘‘Program’’), which is
credit exposure that accounts for erroneous hyperlink and providing an
additional cross-reference and hyperlink currently scheduled to expire on June
relevant product risk factors and 30, 2017, until December 31, 2017. The
portfolio effects across products.12 Rule would make the Reference Guide more
clear to those who use it, consistent proposed rule change is available on the
17Ad–22(e)(1) requires that a covered
with Rule 17Ad–22(e)(1).16 Exchange’s Web site at www.nyse.com,
clearing agency shall establish,
at the principal office of the Exchange,
implement, maintain, and enforce
IV. Conclusion and at the Commission’s Public
written policies and procedures
reasonably designed to provide for a Reference Room.
It is therefore ordered pursuant to
well-founded, clear, transparent, and Section 19(b)(2) of the Act that the II. Self-Regulatory Organization’s
enforceable legal basis for each aspect of proposed rule change (SR–LCH SA– Statement of the Purpose of, and
its activities in all relevant 2017–003) be, and hereby is, Statutory Basis for, the Proposed Rule
jurisdictions.13 approved.17 Change
The Commission finds that the
proposed rule change is consistent with For the Commission by the Division of In its filing with the Commission, the
Section 17A of the Act and Rule 17Ad– Trading and Markets, pursuant to delegated self-regulatory organization included
22 thereunder. In particular, the authority.18 statements concerning the purpose of,
Commission finds that the elimination Eduardo A. Aleman, and basis for, the proposed rule change
of recovery rate risk charges is Assistant Secretary. and discussed any comments it received
consistent with market convention for [FR Doc. 2017–11864 Filed 6–7–17; 8:45 am] on the proposed rule change. The text
pricing index CDS, as represented by BILLING CODE 8011–01–P of those statements may be examined at
LCH SA and discussed above. Moreover,
asabaliauskas on DSKBBXCHB2PROD with NOTICES
the places specified in Item IV below.
the Commission notes that the 14 15 U.S.C. 78q–1(b)(3)(F). The Exchange has prepared summaries,
15 17 CFR 240.17Ad–22(b)(2), (e)(6)(iii), and set forth in sections A, B, and C below,
8 15 U.S.C. 78s(b)(2)(C). (e)(6)(v). of the most significant parts of such
9 15 U.S.C. 78q–1(b)(3)(F). 16 17 CFR 240.17Ad–22(e)(1).
10 17 CFR 240.17Ad–22(b)(2). 17 In approving the proposed rule change, the
statements.
11 See 17 CFR 240.17Ad–22(a)(5) (defining
Commission considered the proposal’s impact on
‘‘covered clearing agency’’). efficiency, competition, and capital formation. 15 1 15 U.S.C.78s(b)(1).
12 See 17 CFR 240.17Ad–22(e)(6)(iii), (e)(6)(v). U.S.C. 78c(f). 2 15 U.S.C. 78a.
1317 CFR 240.17Ad–22(e)(1). 18 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4.
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![Federal Register / Vol. 82, No. 109 / Thursday, June 8, 2017 / Notices 26731
Electronic Comments SECURITIES AND EXCHANGE Notice and request for
ACTION:
COMMISSION comments.
• Use the Commission’s Internet
comment form (http://www.sec.gov/ SUMMARY: In accordance with the
[Release No. 34–80852; File No. SR–
rules/sro.shtml); or NASDAQ–2017–015] Paperwork Reduction Act of 1995, FAA
• Send an email to rule- invites public comments about our
Self-Regulatory Organizations; The intention to request the Office of
comments@sec.gov. Please include File
NASDAQ Stock Market LLC; Notice of Management and Budget (OMB)
Number SR–NYSEMKT–2017–33 on the
Withdrawal of Proposed Rule Change approval to reinstate a previously
subject line.
To Adopt Rule 7017 approved information collection. The
Paper Comments collection involves requirements for
June 2, 2017. operators and repair stations to report
• Send paper comments in triplicate On February 17, 2017, The NASDAQ any malfunctions and defects or service
to Secretary, Securities and Exchange Stock Market LLC (‘‘Exchange’’) filed difficulties to the Administrator. The
Commission, 100 F Street NE., with the Securities and Exchange information collected allows the FAA to
Washington, DC 20549–1090. Commission (‘‘Commission’’), pursuant evaluate its certification standards,
to Section 19(b)(1) of the Securities maintenance programs, and regulatory
All submissions should refer to File Exchange Act of 1934 (‘‘Act’’) 1 and Rule requirements. It is also the basis for
Number SR–NYSEMKT–2017–33. This 19b–4 thereunder,2 a proposed rule issuance of Airworthiness Directives
file number should be included on the change to adopt Rule 7017 to increase designed to prevent unsafe conditions
subject line if email is used. To help the the level of information provided to a and accidents.
Commission process and review your member acting as the stabilizing agent DATES: Written comments should be
comments more efficiently, please use for a follow-on offering of additional submitted by July 10, 2017.
only one method. The Commission will shares of a security that is listed on
ADDRESSES: Interested persons are
post all comments on the Commission’s Nasdaq. The proposed rule change was
invited to submit written comments on
Internet Web site (http://www.sec.gov/ published for comment in the Federal
the proposed information collection to
rules/sro.shtml). Copies of the Register on March 6, 2017.3 On April
the Office of Information and Regulatory
submission, all subsequent 17, 2017, pursuant to Section 19(b)(2) of
Affairs, Office of Management and
amendments, all written statements the Act,4 the Commission designated a
Budget. Comments should be addressed
with respect to the proposed rule longer period within which to approve
to the attention of the Desk Officer,
change that are filed with the the proposed rule change, disapprove
Department of Transportation/FAA, and
Commission, and all written the proposed rule change, or institute
sent via electronic mail to oira_
communications relating to the proceedings to determine whether to
submission@omb.eop.gov, or faxed to
proposed rule change between the disapprove the proposed rule change.5
(202) 395–6974, or mailed to the Office
Commission and any person, other than The Commission received no comment
of Information and Regulatory Affairs,
those that may be withheld from the letters on the proposed rule change.
Office of Management and Budget,
public in accordance with the On June 1, 2017, the Exchange
Docket Library, Room 10102, 725 17th
provisions of 5 U.S.C. 552, will be withdrew the proposed rule change
Street NW., Washington, DC 20503.
available for Web site viewing and (SR–NASDAQ–2017–015). Public Comments Invited: You are
printing in the Commission’s Public For the Commission, by the Division of asked to comment on any aspect of this
Reference Room, 100 F Street NE., Trading and Markets, pursuant to delegated information collection, including (a)
authority.6 Whether the proposed collection of
Washington, DC 20549 on official
Eduardo A. Aleman, information is necessary for FAA’s
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the Assistant Secretary. performance; (b) the accuracy of the
filing also will be available for [FR Doc. 2017–11868 Filed 6–7–17; 8:45 am] estimated burden; (c) ways for FAA to
inspection and copying at the principal BILLING CODE 8011–01–P enhance the quality, utility and clarity
office of the Exchange. All comments of the information collection; and (d)
received will be posted without change; ways that the burden could be
the Commission does not edit personal minimized without reducing the quality
DEPARTMENT OF TRANSPORTATION of the collected information. The agency
identifying information from
will summarize and/or include your
submissions. You should submit only Federal Aviation Administration comments in the request for OMB’s
information that you wish to make
Agency Information Collection clearance of this information collection.
available publicly. All submissions
Activities: Requests for Comments; FOR FURTHER INFORMATION CONTACT:
should refer to File Number SR–
Clearance of Renewed Approval of Ronda Thompson by email at:
NYSEMKT–2017–33, and should be
Information Collection: Service Ronda.Thompson@faa.gov or by
submitted on or before June 29, 2017.
Difficulty Reporting System telephone at (202) 267–1416.
For the Commission, by the Division of SUPPLEMENTARY INFORMATION:
Trading and Markets, pursuant to delegated AGENCY:Federal Aviation OMB Control Number: 2120–0663.
authority.15 Administration, DOT.
asabaliauskas on DSKBBXCHB2PROD with NOTICES
Title: Service Difficulty Reporting
Eduardo A. Aleman, System.
1 15 U.S.C. 78s(b)(1).
Assistant Secretary. Form Numbers: FAA Forms 8010–4 &
2 17 CFR 240.19b–4.
[FR Doc. 2017–11866 Filed 6–7–17; 8:45 am] 3 See Securities Exchange Act Release No. 80120
8070–1.
Type of Review: Re-instatement of an
BILLING CODE 8011–01–P (February 28, 2017), 82 FR 12649.
4 15 U.S.C. 78s(b)(2). information collection.
5 See Securities Exchange Act Release No. 80465, Background: The Federal Register
82 FR 18784 (April 21, 2017). Notice with a 60-day comment period
15 17 CFR 200.30–3(a)(12). 6 17 CFR 200.30–3(a)(12). soliciting comments on the following
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Document Created: 2018-11-14 10:06:59
Document Modified: 2018-11-14 10:06:59
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 82 FR 26729 |
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