82 FR 33192 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend NYSE Arca Equities Rule 7.38 To Specify the Ranking of an Odd Lot Order That Has a Display Price That Is Better Than Its Working Price
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 137 (July 19, 2017)
Federal Register Volume 82, Issue 137 (July 19, 2017)
| Page Range | 33192-33194 | |
| FR Document | 2017-15102 |
[Federal Register Volume 82, Number 137 (Wednesday, July 19, 2017)] [Notices] [Pages 33192-33194] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-15102] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-81142; File No. SR-NYSEArca-2017-73] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend NYSE Arca Equities Rule 7.38 To Specify the Ranking of an Odd Lot Order That Has a Display Price That Is Better Than Its Working Price July 13, 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 June 30, 2017, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE Arca'') filed with the Securities and Exchange Commission (the ``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the 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 Substance of the Proposed Rule Change The Exchange proposes to amend NYSE Arca Equities Rule 7.38 (Odd and Mixed Lots) to specify the ranking of an odd lot order that has a display price that is better than its working price. 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 33193]] 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 NYSE Arca Equities Rule 7.38 (Odd and Mixed Lots) (``Rule 7.38'') to specify the ranking of an odd lot order that has a display price that is better than its working price. Rule 7.38 provides that the working price of an odd lot order will be adjusted both on arrival and when resting on the NYSE Arca Book based on the limit price of the order as follows:If the limit price of an odd lot order is equal to or worse than the contra-side PBBO, it will have a working price equal to the limit price. If the limit price of an odd lot order is better than the contra-side PBBO, it will have a working price equal to the contra-side PBBO. If the PBBO is crossed, the odd lot order will have a working price equal to the same-side PBB or PBO. By moving the working price, an odd lot order to buy (sell) will not trade at a price above (below) the PBO (PBB), or if the PBBO is crossed, above (below) the PBB (PBO). In either case, if the odd lot order is ranked Priority 2--Display Orders,\4\ its display price would not change when its working price is adjusted. --------------------------------------------------------------------------- \4\ As described in Rule 7.36(e)(2), Priority 2--Display Orders are non-marketable Limit Orders with a displayed working price. --------------------------------------------------------------------------- Exchange rules are currently silent regarding how a resting odd lot order that has a display price that is better than its working price would be ranked for trading at that working price.\5\ This scenario would only occur if a resting odd lot order is displayed at a price, and then an Away Market PBBO crosses that display price. In that limited scenario, pursuant to Rule 7.38(b)(1) described above, the working price of the odd-lot order would be adjusted to a price inferior to the display price, but it would remain displayed at the now crossed price. --------------------------------------------------------------------------- \5\ Pursuant to Rule 7.38(b)(1), on arrival, an odd lot order's working price may be adjusted consistent with the terms of the order. However, an arriving odd-lot order would not be assigned a working price that would be inferior to the price at which the arriving odd lot order would be displayed. --------------------------------------------------------------------------- The Exchange proposes to specify that in such case, the ranking and priority category applicable to such an order at its display price, i.e., the price it is displayed and Priority 2--Display Orders, would govern its ranking for purposes of a trade at its different, inferior working price.\6\ This ranking would differ from the Exchange's general rule that an order is ranked based on its working price.\7\ However, the Exchange believes that if the display price of an order is better than its working price, such order has already demonstrated a public willingness to trade at a more aggressive price because it continues to be published in a market data feed at the more aggressive display price.\8\ In such case, the order should receive the benefit of the ranking (both price and priority category) associated with its better display price when determining how that order would be traded at its working price. In other words, an odd-lot order with a better display price than its working price would not be ranked based on its working price, including that it would not be assigned Priority 3--Non-Display Orders at its working price. --------------------------------------------------------------------------- \6\ As described in Rule 7.36(c), an order is ranked based on price, priority category, and time. Such ranking is only applicable once an order is resting on the NYSE Arca Book. \7\ Rule 7.36(d) provides than [sic] all orders are ranked based on the working price of an order. Rule 7.36(e)(3) generally provides that non-marketable orders for which the working price is not displayed have third priority behind Market Orders and non- marketable Limit Orders that are displayed at their working price. This proposed rule change would be an exception to these rules. \8\ See Rule 7.36(b)(1) (odd-lot sized orders are considered displayed for ranking purposes). --------------------------------------------------------------------------- The Exchange further believes that if an odd-lot order is assigned a new working price that is worse than its display price, such order should not be assigned a new working time. In other words, when trading at its working price, its time ranking would be based on the working time associated with its display price.\9\ Maintaining the original working time of such order would ensure that it maintains its original ranking, even if it trades at a different price. --------------------------------------------------------------------------- \9\ Rule 7.36(f)(2) provides that an order is assigned a new working time any time the working price of the order changes. This proposed rule change would be an exception to this general rule. --------------------------------------------------------------------------- To effect this change, the Exchange proposes to amend Rule 7.38(b)(1) to provide that an odd-lot order ranked Priority 2--Display Orders would not be assigned a new working time if its working price is adjusted under Rule 7.38(b)(1). In addition, if the display price of an odd lot order to buy (sell) is above (below) its working price, it would be ranked based on its display price.\10\ --------------------------------------------------------------------------- \10\ For example, assume the PBBO is 10.07 x 10.10 and the Exchange receives orders ranked Priority 2--Display Orders in the following sequence: T1 to buy 25 shares displayed at 10.08, T2 to buy 25 shares displayed at 10.09, T3 to buy 25 shares displayed at 10.08, and T4 to buy 100 shares displayed at 10.07. Assume next that the PBO changes to 10.07. The working price of T1, T2, and T3 will be adjusted to 10.07, but they would keep their original working time. Next, the Exchange receives an incoming order to sell 100 shares at 10.07. The Exchange would trade the incoming order with the resting orders in the following sequence: T2, T1, T3, and then T4 would be allocated the remaining 25 shares. T2 would trade before T1 because it has a better price ranking based on its display price. If the incoming order to sell were for 50 shares, only T2 and T1 would trade. --------------------------------------------------------------------------- Because an odd lot order with a display price better than its working price currently trades in this manner, these changes will be in effect when this proposed rule change is operative. 2. Statutory Basis The proposed rule change is consistent with Section 6(b) of the Securities Exchange Act of 1934 (the ``Act''),\11\ in general, and furthers the objectives of Section 6(b)(5),\12\ in particular, because 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. --------------------------------------------------------------------------- \11\ 15 U.S.C. 78f(b). \12\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- Specifically, the Exchange believes that the proposed rule change would remove impediments to and perfect the mechanism of a free and open market and a national market system because the Exchange believes that an order that has been displayed should receive the benefit of the ranking of that displayed price if it trades at a less aggressive working price. This scenario would only occur if a resting odd-lot order has been displayed at a price, and then an Away Market PBBO crosses that price and then the working price of that order is adjusted to a price inferior to its display price. In such case, while the odd lot order would be executed at its working price, because it was both willing to trade at a better price and is still displayed at that better price, the Exchange proposes that it would be ranked based on its display price for purposes of its execution at the working price. If the PBBO had not crossed the odd-lot order, such order would have had the benefit of the ranking based on its display price and the Exchange believes it would be consistent with the protection of investors and the public for the odd-lot order to retain such ranking when its working price is moved to an inferior price. The Exchange further believes that the [[Page 33194]] proposed rule change would promote fair and orderly markets that would protect investors and the public interest because it would promote the display of liquidity by ensuring that a displayed odd lot order maintains its ranking even if it trades at a less aggressive price. The Exchange further believes that the proposed rule change would remove impediments to and perfect the mechanism of a free and open market and a national market system because it would promote transparency in Exchange rules and reduce potential confusion regarding how an odd-lot order would be ranked and execute [sic] in the limited scenario when the display price of a resting odd lot has been crossed, and it has been assigned a working price inferior to its display price. 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 Exchange believes that the proposed rule change is not designed to address any competitive issues but rather to provide an incentive for market participants to enter aggressively-priced displayed liquidity. 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 Because the foregoing 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 \13\ and Rule 19b- 4(f)(6) thereunder.\14\ --------------------------------------------------------------------------- \13\ 15 U.S.C. 78s(b)(3)(A). \14\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b- 4(f)(6)(iii), the Exchange 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. --------------------------------------------------------------------------- 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. 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-2017-73 on the subject line. Paper Comments Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NYSEArca-2017-73. 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-NYSEArca-2017-73 and should be submitted on or before August 9, 2017. --------------------------------------------------------------------------- \15\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\15\ Jill M. Peterson, Assistant Secretary. [FR Doc. 2017-15102 Filed 7-18-17; 8:45 am] BILLING CODE 8011-01-P
![33192 Federal Register / Vol. 82, No. 137 / Wednesday, July 19, 2017 / Notices
as a result of third-party market forces, transactions with the Acquiring Fund.2 SECURITIES AND EXCHANGE
such as supply and demand. Therefore, The purchase of Creation Units by an COMMISSION
applicants assert that secondary market Acquiring Fund directly from a Fund
transactions in shares will not lead to will be accomplished in accordance [Release No. 34–81142; File No. SR–
discrimination or preferential treatment with the policies of the Acquiring Fund NYSEArca–2017–73]
among purchasers. Finally, applicants and will be based on the NAVs of the
represent that share market prices will Funds. Self-Regulatory Organizations; NYSE
be disciplined by arbitrage 9. Applicants also request relief to Arca, Inc.; Notice of Filing and
opportunities, which should prevent permit a Feeder Fund to acquire shares Immediate Effectiveness of Proposed
shares from trading at a material of another registered investment Rule Change To Amend NYSE Arca
discount or premium from NAV. company managed by the Adviser
6. With respect to Funds that hold Equities Rule 7.38 To Specify the
having substantially the same Ranking of an Odd Lot Order That Has
non-U.S. Portfolio Positions and that
investment objectives as the Feeder a Display Price That Is Better Than Its
effect creations and redemptions of
Fund (‘‘Master Fund’’) beyond the Working Price
Creation Units in kind, applicants
limitations in section 12(d)(1)(A) and
request relief from the requirement July 13, 2017.
permit the Master Fund, and any
imposed by section 22(e) in order to
allow such Funds to pay redemption principal underwriter for the Master Pursuant to Section 19(b)(1) 1 of the
proceeds within fifteen calendar days Fund, to sell shares of the Master Fund Securities Exchange Act of 1934 (the
following the tender of Creation Units to the Feeder Fund beyond the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
for redemption. Applicants assert that limitations in section 12(d)(1)(B). notice is hereby given that, on June 30,
the requested relief would not be 10. Section 6(c) of the Act permits the 2017, NYSE Arca, Inc. (the ‘‘Exchange’’
inconsistent with the spirit and intent of Commission to exempt any persons or or ‘‘NYSE Arca’’) filed with the
section 22(e) to prevent unreasonable, transactions from any provision of the Securities and Exchange Commission
undisclosed or unforeseen delays in the Act if such exemption is necessary or (the ‘‘Commission’’) the proposed rule
actual payment of redemption proceeds. appropriate in the public interest and change as described in Items I and II
7. Applicants request an exemption to consistent with the protection of below, which Items have been prepared
permit Acquiring Funds to acquire Fund investors and the purposes fairly by the self-regulatory organization. The
shares beyond the limits of section intended by the policy and provisions of Commission is publishing this notice to
12(d)(1)(A) of the Act; and the Funds, the Act. Section 12(d)(1)(J) of the Act
solicit comments on the proposed rule
and any principal underwriter for the provides that the Commission may
Funds, and/or any broker or dealer change from interested persons.
exempt any person, security, or
registered under the Exchange Act, to transaction, or any class or classes of I. Self-Regulatory Organization’s
sell shares to Acquiring Funds beyond persons, securities, or transactions, from Statement of the Terms of Substance of
the limits of section 12(d)(1)(B) of the any provision of section 12(d)(1) if the the Proposed Rule Change
Act. The application’s terms and exemption is consistent with the public
conditions are designed to, among other interest and the protection of investors. The Exchange proposes to amend
things, help prevent any potential (i) Section 17(b) of the Act authorizes the NYSE Arca Equities Rule 7.38 (Odd and
undue influence over a Fund through Commission to grant an order Mixed Lots) to specify the ranking of an
control or voting power, or in permitting a transaction otherwise odd lot order that has a display price
connection with certain services, prohibited by section 17(a) if it finds that is better than its working price. The
transactions, and underwritings, (ii) that (a) the terms of the proposed proposed rule change is available on the
excessive layering of fees, and (iii) transaction are fair and reasonable and Exchange’s Web site at www.nyse.com,
overly complex fund structures, which do not involve overreaching on the part at the principal office of the Exchange,
are the concerns underlying the limits of any person concerned; (b) the and at the Commission’s Public
in sections 12(d)(1)(A) and (B) of the proposed transaction is consistent with Reference Room.
Act. the policies of each registered
8. Applicants request an exemption investment company involved; and (c) II. Self-Regulatory Organization’s
from sections 17(a)(1) and 17(a)(2) of the the proposed transaction is consistent Statement of the Purpose of, and
Act to permit persons that are affiliated with the general purposes of the Act. Statutory Basis for, the Proposed Rule
persons, or second tier affiliates, of the Change
Funds, solely by virtue of certain For the Commission, by the Division of
ownership interests, to effectuate Investment Management, under delegated
In its filing with the Commission, the
authority.
purchases and redemptions in-kind. The self-regulatory organization included
deposit procedures for in-kind Jill M. Peterson,
statements concerning the purpose of,
purchases of Creation Units and the Assistant Secretary. and basis for, the proposed rule change
redemption procedures for in-kind [FR Doc. 2017–15169 Filed 7–18–17; 8:45 am] and discussed any comments it received
redemptions of Creation Units will be BILLING CODE 8011–01–P on the proposed rule change. The text
the same for all purchases and of those statements may be examined at
redemptions and Deposit Instruments 2 The requested relief would apply to direct sales
the places specified in Item IV below.
asabaliauskas on DSKBBXCHB2PROD with NOTICES
and Redemption Instruments will be of shares in Creation Units by a Fund to an
The Exchange has prepared summaries,
valued in the same manner as those Acquiring Fund and redemptions of those shares.
Applicants, moreover, are not seeking relief from set forth in sections A, B, and C below,
Portfolio Positions currently held by the section 17(a) for, and the requested relief will not of the most significant parts of such
Funds. Applicants also seek relief from apply to, transactions where a Fund could be
the prohibitions on affiliated deemed an affiliated person, or a second-tier
statements.
transactions in section 17(a) to permit a affiliate, of an Acquiring Fund because an Adviser
or an entity controlling, controlled by or under
Fund to sell its shares to and redeem its common control with an Adviser provides
1 15 U.S.C. 78s(b)(1).
shares from an Acquiring Fund, and to investment advisory services to that Acquiring
2 15 U.S.C. 78a.
engage in the accompanying in-kind Fund. 3 17 CFR 240.19b–4.
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![Federal Register / Vol. 82, No. 137 / Wednesday, July 19, 2017 / Notices 33193
A. Self-Regulatory Organization’s inferior working price.6 This ranking Because an odd lot order with a
Statement of the Purpose of, and the would differ from the Exchange’s display price better than its working
Statutory Basis for, the Proposed Rule general rule that an order is ranked price currently trades in this manner,
Change based on its working price.7 However, these changes will be in effect when this
the Exchange believes that if the display proposed rule change is operative.
1. Purpose price of an order is better than its
2. Statutory Basis
The Exchange proposes to amend working price, such order has already
NYSE Arca Equities Rule 7.38 (Odd and demonstrated a public willingness to The proposed rule change is
Mixed Lots) (‘‘Rule 7.38’’) to specify the trade at a more aggressive price because consistent with Section 6(b) of the
ranking of an odd lot order that has a it continues to be published in a market Securities Exchange Act of 1934 (the
display price that is better than its data feed at the more aggressive display ‘‘Act’’),11 in general, and furthers the
working price. price.8 In such case, the order should objectives of Section 6(b)(5),12 in
Rule 7.38 provides that the working receive the benefit of the ranking (both particular, because it is designed to
price of an odd lot order will be price and priority category) associated prevent fraudulent and manipulative
adjusted both on arrival and when with its better display price when acts and practices, to promote just and
resting on the NYSE Arca Book based on determining how that order would be equitable principles of trade, to foster
the limit price of the order as follows: traded at its working price. In other cooperation and coordination with
words, an odd-lot order with a better persons engaged in facilitating
• If the limit price of an odd lot order
display price than its working price transactions in securities, to remove
is equal to or worse than the contra-side
would not be ranked based on its impediments to, and perfect the
PBBO, it will have a working price
working price, including that it would mechanism of, a free and open market
equal to the limit price.
not be assigned Priority 3—Non-Display and a national market system and, in
• If the limit price of an odd lot order general, to protect investors and the
is better than the contra-side PBBO, it Orders at its working price.
The Exchange further believes that if public interest.
will have a working price equal to the Specifically, the Exchange believes
an odd-lot order is assigned a new
contra-side PBBO. that the proposed rule change would
working price that is worse than its
• If the PBBO is crossed, the odd lot display price, such order should not be remove impediments to and perfect the
order will have a working price equal to assigned a new working time. In other mechanism of a free and open market
the same-side PBB or PBO. words, when trading at its working and a national market system because
By moving the working price, an odd price, its time ranking would be based the Exchange believes that an order that
lot order to buy (sell) will not trade at on the working time associated with its has been displayed should receive the
a price above (below) the PBO (PBB), or display price.9 Maintaining the original benefit of the ranking of that displayed
if the PBBO is crossed, above (below) working time of such order would price if it trades at a less aggressive
the PBB (PBO). In either case, if the odd ensure that it maintains its original working price. This scenario would only
lot order is ranked Priority 2—Display ranking, even if it trades at a different occur if a resting odd-lot order has been
Orders,4 its display price would not price. displayed at a price, and then an Away
change when its working price is To effect this change, the Exchange Market PBBO crosses that price and
adjusted. proposes to amend Rule 7.38(b)(1) to then the working price of that order is
Exchange rules are currently silent provide that an odd-lot order ranked adjusted to a price inferior to its display
regarding how a resting odd lot order Priority 2—Display Orders would not be price. In such case, while the odd lot
that has a display price that is better assigned a new working time if its order would be executed at its working
than its working price would be ranked working price is adjusted under Rule price, because it was both willing to
for trading at that working price.5 This 7.38(b)(1). In addition, if the display trade at a better price and is still
scenario would only occur if a resting price of an odd lot order to buy (sell) is displayed at that better price, the
odd lot order is displayed at a price, and above (below) its working price, it Exchange proposes that it would be
then an Away Market PBBO crosses that would be ranked based on its display ranked based on its display price for
display price. In that limited scenario, price.10 purposes of its execution at the working
pursuant to Rule 7.38(b)(1) described price. If the PBBO had not crossed the
above, the working price of the odd-lot 6 As described in Rule 7.36(c), an order is ranked odd-lot order, such order would have
order would be adjusted to a price based on price, priority category, and time. Such had the benefit of the ranking based on
inferior to the display price, but it ranking is only applicable once an order is resting its display price and the Exchange
on the NYSE Arca Book.
would remain displayed at the now 7 Rule 7.36(d) provides than [sic] all orders are
believes it would be consistent with the
crossed price. ranked based on the working price of an order. Rule protection of investors and the public
The Exchange proposes to specify that 7.36(e)(3) generally provides that non-marketable for the odd-lot order to retain such
in such case, the ranking and priority orders for which the working price is not displayed ranking when its working price is
have third priority behind Market Orders and non-
category applicable to such an order at marketable Limit Orders that are displayed at their
moved to an inferior price. The
its display price, i.e., the price it is working price. This proposed rule change would be Exchange further believes that the
displayed and Priority 2—Display an exception to these rules.
8 See Rule 7.36(b)(1) (odd-lot sized orders are changes to 10.07. The working price of T1, T2, and
Orders, would govern its ranking for
considered displayed for ranking purposes). T3 will be adjusted to 10.07, but they would keep
purposes of a trade at its different, their original working time. Next, the Exchange
asabaliauskas on DSKBBXCHB2PROD with NOTICES
9 Rule 7.36(f)(2) provides that an order is assigned
a new working time any time the working price of receives an incoming order to sell 100 shares at
4 As described in Rule 7.36(e)(2), Priority 2— the order changes. This proposed rule change 10.07. The Exchange would trade the incoming
Display Orders are non-marketable Limit Orders would be an exception to this general rule. order with the resting orders in the following
with a displayed working price. 10 For example, assume the PBBO is 10.07 × 10.10 sequence: T2, T1, T3, and then T4 would be
5 Pursuant to Rule 7.38(b)(1), on arrival, an odd and the Exchange receives orders ranked Priority allocated the remaining 25 shares. T2 would trade
lot order’s working price may be adjusted consistent 2—Display Orders in the following sequence: T1 to before T1 because it has a better price ranking based
with the terms of the order. However, an arriving buy 25 shares displayed at 10.08, T2 to buy 25 on its display price. If the incoming order to sell
odd-lot order would not be assigned a working shares displayed at 10.09, T3 to buy 25 shares were for 50 shares, only T2 and T1 would trade.
11 15 U.S.C. 78f(b).
price that would be inferior to the price at which displayed at 10.08, and T4 to buy 100 shares
the arriving odd lot order would be displayed. displayed at 10.07. Assume next that the PBO 12 15 U.S.C. 78f(b)(5).
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![33194 Federal Register / Vol. 82, No. 137 / Wednesday, July 19, 2017 / Notices
proposed rule change would promote temporarily suspend such rule change if should refer to File Number SR–
fair and orderly markets that would it appears to the Commission that such NYSEArca–2017–73 and should be
protect investors and the public interest action is necessary or appropriate in the submitted on or before August 9, 2017.
because it would promote the display of public interest, for the protection of For the Commission, by the Division of
liquidity by ensuring that a displayed investors, or otherwise in furtherance of Trading and Markets, pursuant to delegated
odd lot order maintains its ranking even the purposes of the Act. If the authority.15
if it trades at a less aggressive price. Commission takes such action, the Jill M. Peterson,
The Exchange further believes that the Commission shall institute proceedings Assistant Secretary.
proposed rule change would remove to determine whether the proposed rule
[FR Doc. 2017–15102 Filed 7–18–17; 8:45 am]
impediments to and perfect the should be approved or disapproved.
BILLING CODE 8011–01–P
mechanism of a free and open market
and a national market system because it IV. Solicitation of Comments
would promote transparency in Interested persons are invited to
submit written data, views, and SECURITIES AND EXCHANGE
Exchange rules and reduce potential
arguments concerning the foregoing, COMMISSION
confusion regarding how an odd-lot
order would be ranked and execute [sic] including whether the proposed rule [Release No. 34–81140; File No. SR–
in the limited scenario when the display change is consistent with the Act. NYSEArca–2017–77]
price of a resting odd lot has been Comments may be submitted by any of
crossed, and it has been assigned a the following methods: Self-Regulatory Organizations; NYSE
working price inferior to its display Arca, Inc.; Notice of Filing and
Electronic Comments Immediate Effectiveness of Proposed
price.
• Use the Commission’s Internet Rule Change To Amend the NYSE Arca
B. Self-Regulatory Organization’s comment form (http://www.sec.gov/ Options Fee Schedule
Statement on Burden on Competition rules/sro.shtml); or
The Exchange does not believe that • Send an email to rule-comments@ July 13, 2017.
the proposed rule change will impose sec.gov. Please include File Number SR– Pursuant to Section 19(b)(1) 1 of the
any burden on competition that is not NYSEArca–2017–73 on the subject line. Securities Exchange Act of 1934 (the
necessary or appropriate in furtherance ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
Paper Comments notice is hereby given that, on July 10,
of the purposes of the Act. The
Exchange believes that the proposed • Send paper comments in triplicate 2017, NYSE Arca, Inc. (the ‘‘Exchange’’
rule change is not designed to address to Brent J. Fields, Secretary, Securities or ‘‘NYSE Arca’’) filed with the
any competitive issues but rather to and Exchange Commission, 100 F Street Securities and Exchange Commission
provide an incentive for market NE., Washington, DC 20549–1090. (the ‘‘Commission’’) the proposed rule
participants to enter aggressively-priced All submissions should refer to File change as described in Items I, II, and
displayed liquidity. Number SR–NYSEArca–2017–73. This III below, which Items have been
file number should be included on the prepared by the self-regulatory
C. Self-Regulatory Organization’s subject line if email is used. To help the organization. The Commission is
Statement on Comments on the Commission process and review your publishing this notice to solicit
Proposed Rule Change Received From comments more efficiently, please use comments on the proposed rule change
Members, Participants, or Others only one method. The Commission will from interested persons.
No written comments were solicited post all comments on the Commission’s
or received with respect to the proposed Internet Web site (http://www.sec.gov/ I. Self-Regulatory Organization’s
rule change. rules/sro.shtml). Copies of the Statement of the Terms of the Substance
submission, all subsequent of the Proposed Rule Change
III. Date of Effectiveness of the
amendments, all written statements The Exchange proposes to amend the
Proposed Rule Change and Timing for
with respect to the proposed rule NYSE Arca Options Fee Schedule (‘‘Fee
Commission Action
change that are filed with the Schedule’’). The Exchange proposes to
Because the foregoing proposed rule Commission, and all written implement the fee change effective July
change does not: (i) Significantly affect communications relating to the 10, 2017.4 The proposed rule change is
the protection of investors or the public proposed rule change between the available on the Exchange’s Web site at
interest; (ii) impose any significant Commission and any person, other than www.nyse.com, at the principal office of
burden on competition; and (iii) become those that may be withheld from the the Exchange, and at the Commission’s
operative for 30 days from the date on public in accordance with the Public Reference Room.
which it was filed, or such shorter time provisions of 5 U.S.C. 552, will be
as the Commission may designate, it has II. Self-Regulatory Organization’s
available for Web site viewing and
become effective pursuant to Section Statement of the Purpose of, and
printing in the Commission’s Public
19(b)(3)(A) of the Act 13 and Rule 19b– Statutory Basis for, the Proposed Rule
Reference Room, 100 F Street NE.,
4(f)(6) thereunder.14 Change
Washington, DC 20549 on official
At any time within 60 days of the business days between the hours of In its filing with the Commission, the
filing of the proposed rule change, the 10:00 a.m. and 3:00 p.m. Copies of the self-regulatory organization included
Commission summarily may statements concerning the purpose of,
asabaliauskas on DSKBBXCHB2PROD with NOTICES
filing also will be available for
inspection and copying at the principal and basis for, the proposed rule change
13 15 U.S.C. 78s(b)(3)(A).
14 17 CFR 240.19b–4(f)(6). As required under Rule
office of the Exchange. All comments
15 17 CFR 200.30–3(a)(12).
19b–4(f)(6)(iii), the Exchange provided the received will be posted without change;
1 15 U.S.C. 78s(b)(1).
Commission with written notice of its intent to file the Commission does not edit personal 2 15 U.S.C. 78a.
the proposed rule change, along with a brief identifying information from 3 17 CFR 240.19b–4.
description and the text of the proposed rule
change, at least five business days prior to the date
submissions. You should submit only 4 The Exchange originally filed to amend the Fee
of filing of the proposed rule change, or such information that you wish to make Schedule on July 3, 2017 (SR–NYSEArca–2017–74)
shorter time as designated by the Commission. available publicly. All submissions and withdrew such filing on July 10, 2017.
VerDate Sep<11>2014 18:49 Jul 18, 2017 Jkt 241001 PO 00000 Frm 00155 Fmt 4703 Sfmt 4703 E:\FR\FM\19JYN1.SGM 19JYN1](https://thefederalregister.org/doc/82_FR_33329/page/3.svg)
Document Created: 2017-07-19 06:17:50
Document Modified: 2017-07-19 06:17:50
| 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 33192 |
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