82 FR 55912 - Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Remove Directed Order Functionality
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 225 (November 24, 2017)
Federal Register Volume 82, Issue 225 (November 24, 2017)
| Page Range | 55912-55914 | |
| FR Document | 2017-25475 |
[Federal Register Volume 82, Number 225 (Friday, November 24, 2017)] [Notices] [Pages 55912-55914] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-25475] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82131; File No. SR-GEMX-2017-52] Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Remove Directed Order Functionality November 20, 2017. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on November 16, 2017, Nasdaq GEMX, LLC (``GEMX'' or ``Exchange'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I, II, and III, below, which Items have been prepared by the Exchange. 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\ 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 remove Directed Order \3\ functionality on GEMX. --------------------------------------------------------------------------- \3\ A ``Directed Order'' is an order routed from an Electronic Access Member to an Exchange market maker through the Exchange's System. --------------------------------------------------------------------------- The text of the proposed rule change is available on the Exchange's Web site at http://nasdaqgemx.cchwallstreet.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 Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the [[Page 55913]] proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose Last year the Exchange filed to delay the implementation of the Directed Order functionality in conjunction with a replatform to INET.\4\ INET is the proprietary core technology utilized across Nasdaq's global markets and utilized on The Nasdaq Options Market LLC (``NOM''), Nasdaq PHLX LLC (``Phlx'') and Nasdaq BX, Inc. (``BX'') (collectively, ``Nasdaq Exchanges''). GEMX was migrated to INET technology in 2017. With the migration, GEMX delayed the implementation of the Directed Order functionality to stage the re-platform to provide maximum benefit to its Members while also ensuring a successful rollout. At that time, the Exchange noted that the Exchange will introduce the Directed Order functionality within one year from the date of this filing, otherwise the Exchange will file a rule proposal with the Commission to remove these rules. The Exchange filed the initial rule change on December 16, 2016.\5\ The Exchange has determined at this time not to offer Directed Order functionality.\6\ If the Exchange determines to offer this functionality at a later date, a rule proposal will be filed at that time. --------------------------------------------------------------------------- \4\ See Securities Exchange Act Release No. 80011 (February 10, 2017), 82 FR 10927 (February 16, 2017) (SR-ISEGemini-2016-17). \5\ Id. \6\ This functionality was turned off on February 21, 2017. See MIC-2017-07. --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\7\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\8\ 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 because the Exchange will remove rule text related to functionality which will not be offered on GEMX. The current rule text indicates the functionality is not offered today. The Exchange believes that removing Rule 811 from the Rulebook will avoid confusion as to whether this functionality will be enabled in the future. --------------------------------------------------------------------------- \7\ 15 U.S.C. 78f(b). \8\ 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 not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed rule change will impose any burden on intra-market competition because the Exchange is not offering this functionality today and believes there is no interest among Members for this functionality. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action 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)(iii) of the Act \9\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\10\ --------------------------------------------------------------------------- \9\ 15 U.S.C. 78s(b)(3)(A)(iii). \10\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intent to file 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. The Exchange has satisfied this requirement. --------------------------------------------------------------------------- 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: (i) Necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) 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 CommentsUse 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 Number SR-GEMX-2017-52 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-GEMX-2017-52. 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. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-GEMX-2017-52 and should be submitted on or before December 15, 2017. --------------------------------------------------------------------------- \11\ 17 CFR 200.30-3(a)(12). [[Page 55914]] --------------------------------------------------------------------------- For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\11\ Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-25475 Filed 11-22-17; 8:45 am] BILLING CODE 8011-01-P
![55912 Federal Register / Vol. 82, No. 225 / Friday, November 24, 2017 / Notices
proposed to amend its short charge to that by changing its margin framework 2017–006 and SR–LCH SA–2017–007)
account for the P&L impact of a credit to add the new vega margin and revise be, and hereby are, approved.47
event on the reference obligations of a existing individual margin components For the Commission by the Division of
constituent of the underlying index CDS as described above, LCH SA reasonably Trading and Markets, pursuant to delegated
has on a CDS Option. Furthermore, LCH considers the risks specific to CDS authority.48
SA also proposed other amendments, Options (including consideration of Eduardo A. Aleman,
described in greater detail in section risks associated with skew and volatility Assistant Secretary.
II.e.2, above and in the Notices, to of volatility, among others), and [FR Doc. 2017–25354 Filed 11–22–17; 8:45 am]
incorporate at-the-money volatility data, establishes an appropriate method for BILLING CODE 8011–01–P
account for the non-linearity of CDS
measuring its credit exposures to
Options by considering the combined
Clearing Members participating in the
P&L impacts of simultaneous defaults, SECURITIES AND EXCHANGE
and to consider the impact of option CDS Option clearing service. As a result,
the Commission finds that the proposed COMMISSION
expiry. LCH SA also proposed to amend
its interest rate margin to calculate the rule changes are consistent with the [Release No. 34–82131; File No. SR–GEMX–
P&L impact on CDS Options due to requirements of Rules 17Ad–22(b)(2) 2017–52]
changes in interest rates, and proposed and (e)(6)(i) and (v).
to introduce a new margin component, Self-Regulatory Organizations; Nasdaq
2. Default Fund Methodology GEMX, LLC; Notice of Filing and
vega margin, to capture the risks
associated with skew and volatility of LCH SA also proposed to amend its Immediate Effectiveness of Proposed
volatility that specifically affect CDS Rule Change To Remove Directed
existing Default Fund Methodology to
Options. Similarly, LCH SA proposed Order Functionality
address the additional risks associated
amendments to its liquidity risk margin with clearing CDS Options. As November 20, 2017.
to account for the costs associated with described above, the Default Fund Pursuant to Section 19(b)(1) of the
vega hedging a portfolio of CDS Methodology is designed to identify Securities Exchange Act of 1934
Options, proposed changes to the stress scenarios that impose extreme but (‘‘Act’’),1 and Rule 19b–4 thereunder,2
accrued coupon liquidation risk margin plausible market moves in order to notice is hereby given that on November
to account for exposures to CDS Options 16, 2017, Nasdaq GEMX, LLC (‘‘GEMX’’
calculate stress losses in excess of
during the 5-day liquidation period, and or ‘‘Exchange’’) filed with the Securities
proposed changes to its credit event margin. These losses are then used to
size LCH SA’s Default Fund. Among and Exchange Commission
margin to account for different (‘‘Commission’’) the proposed rule
maturities separately and to consider other things, LCH SA proposed to
amend its Default Fund Methodology to change as described in Items I, II, and
combinations of upward, downward or III, below, which Items have been
flat recovery rate moves. take into account the new vega margin
by adding a stressed vega margin, new prepared by the Exchange. The
Based on these proposed changes, the
Volatility Scenarios, and adopt a new Commission is publishing this notice to
Commission believes that LCH SA will
solicit comments on the proposed rule
have rules that are designed to collect method for calculating the stressed
change from interested persons.
and maintain financial resources spread margin that would take into
intended to cover the risks to which account at-the-money implied volatility I. Self-Regulatory Organization’s
LCH SA is exposed in connection with moves for CDS Options in the stress Statement of the Terms of Substance of
offering clearing services for CDS scenarios used to size the CDSClear the Proposed Rule Change
Options. As a result, the Commission default fund. Based on these The Exchange proposes to remove
believes that LCH SA will be able to amendments, the Commission believes Directed Order 3 functionality on GEMX.
minimize the risk that the losses that LCH SA appropriately extends its The text of the proposed rule change
associated with the default of a existing Default Fund Methodology to is available on the Exchange’s Web site
participant (or participants) in the address the clearing of CDS Options, at http://nasdaqgemx.cchwall
clearing service for CDS Options will street.com/, at the principal office of the
and as a result will be able to maintain
extend to other participants in the Exchange, and at the Commission’s
financial resources adequate to cover
service or negatively affect the U.S. Public Reference Room.
financial system as a whole. the risks associated with clearing CDS
Consequently, the Commission believes Options, including sufficient resources II. Self-Regulatory Organization’s
that the proposed rule changes will to enable LCH SA cover its credit Statement of the Purpose of, and
provide for rules that permit LCH SA to exposure to each participant fully with Statutory Basis for, the Proposed Rule
be able to safeguard the securities and a high degree of confidence and to cover Change
funds which are in its custody or the default of the two participant In its filing with the Commission, the
control or for which it is responsible, families to which LCH SA has Exchange included statements
and to be able to protect investors and exposures in extreme but plausible concerning the purpose of and basis for
the public interest. Accordingly, the market conditions. Accordingly, the the proposed rule change and discussed
Commission finds that the proposed Commission finds that the proposed any comments it received on the
rule changes are consistent with the rule changes amending LCH SA’s
requirements of Section 17A(b)(3)(F). Default Fund Methodology are 47 In approving the proposed rule changes, the
sradovich on DSK3GMQ082PROD with NOTICES
Moreover, considering these proposed consistent with the requirements of Rule Commission considered the proposals’ impact on
changes as a whole, the Commission 17Ad–22(b)(3) and (e)(4)(i) and (ii). efficiency, competition, and capital formation. 15
believes that the proposed rule changes U.S.C. 78c(f).
48 17 CFR 200.30–3(a)(12).
will ensure that LCH SA uses margin IV. Conclusion
1 15 U.S.C. 78s(b)(1).
requirements to limit its credit 2 17 CFR 240.19b–4.
exposures to Clearing Members It is therefore ordered pursuant to
3 A ‘‘Directed Order’’ is an order routed from an
participating in the CDS Option clearing Section 19(b)(2) of the Act that the
Electronic Access Member to an Exchange market
service. The Commission also believes proposed rule changes (SR–LCH SA– maker through the Exchange’s System.
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![55914 Federal Register / Vol. 82, No. 225 / Friday, November 24, 2017 / Notices
For the Commission, by the Division of satisfaction and the outcomes of the Women’s Business Council Small
Trading and Markets, pursuant to delegated delivered business assistance services. Business Administration, 409 3rd Street,
authority.11 Surveys will be completed by a sample 5th Floor, Washington, DC 20416.
Eduardo A. Aleman, of clients who received business FOR FURTHER INFORMATION CONTACT:
Assistant Secretary. assistance services at least one year ago. Dolores Rowen, Associate Director,
[FR Doc. 2017–25475 Filed 11–22–17; 8:45 am] A minimum one year lag is desired to Office of Policy and Research, National
BILLING CODE 8011–01–P allow the business outcomes of the Women’s Business Council Small
services to be observed. Because Business Administration,
Women’s Business Center offer both Dolores.rowen@sba.gov 202–205–9974,
SMALL BUSINESS ADMINISTRATION training and counseling services, clients or Curtis B. Rich, Management Analyst,
who received either service will be 202–205–7030, curtis.rich@sba.gov.
Data Collection Available for Public included.
SUPPLEMENTARY INFORMATION: The
Comments Solicitation of Public Comments National Women’s Business Council
60-day notice and request for
ACTION: SBA is requesting comments on (a) will examine women’s participation in
comments. whether the collection of information is business incubation and acceleration
necessary for the agency to properly programs to understand the
SUMMARY: The Paperwork Reduction Act perform its functions; (b) whether the characteristics of incubators and
(PRA) of 1995, requires federal agencies burden estimates are accurate; (c) accelerators that affect the business
to publish a notice in the Federal whether there are ways to minimize the outcomes of women business owners.
Register to solicit public comments on burden, including through the use of NWBC will also gain insights into
each collection of information before automated techniques or other forms of factors that affect women’s participation
submitting it to OMB for approval, and information technology; and (d) whether in these programs. Respondents will be
to allow 60 days for the public to there are ways to enhance the quality, managers of incubators and accelerators,
provide comments. This notice utility, and clarity of the information. women business owners who graduated
complies with such requirements and from the programs, and a sample of
announces SBA’s proposal to conduct a Summary of Information Collection women business owners from the
survey of the small business owners or Title: SBA’s Women’s Business Center general population.
potential owners who receive (WBC) Client Survey. Summary of Information Collection
counseling and training through SBA’s Description of Respondents: WBC
Women’s Business Center (WBC) clients who received entrepreneurship Title: Women’s Participation in
program. counseling and/or training services. Incubators and Acceleration.
Estimated Number of Respondents: Description of Respondents: Managers
DATES: Submit comments on or before
1,145. of incubators and accelerators, women
January 23, 2018.
Estimated Annual Hour Burden: business owners who graduated from
ADDRESSES: Send all comments to Scott the programs, and a sample of women
1,496.
Henry, Director, Office of Performance business owners from the general
Management, Small Business Curtis Rich,
population.
Administration, 409 3rd Street SW., Management Analyst.
Form Number: N/A.
Room 6010, Washington, DC 20416. [FR Doc. 2017–25388 Filed 11–22–17; 8:45 am] Total Estimated Annual Responses:
FOR FURTHER INFORMATION CONTACT: BILLING CODE 8025–01–P 500.
Scott Henry, Director, Office of Total Estimated Annual Hour Burden:
Performance Management 202–205– 123.
6474, wbcsurvey@sba.gov or Curtis B. SMALL BUSINESS ADMINISTRATION
Rich, Management Analyst, 202–205– Curtis B. Rich,
7030 curtis.rich@sba.gov. Data Collection Available for Public Management Analyst.
Comments [FR Doc. 2017–25387 Filed 11–22–17; 8:45 am]
SUPPLEMENTARY INFORMATION: The SBA’s
Women’s Business Centers represent a 60-day notice and request for
ACTION: BILLING CODE 8025–01–P
national network of nearly 100 comments.
educational centers designed to assist
women start and grow small businesses. SUMMARY: The Small Business SMALL BUSINESS ADMINISTRATION
WBCs operate with the mission to ‘‘level Administration (SBA) intends to request
approval, from the Office of Data Collection Available for Public
the playing field’’ for women
Management and Budget (OMB) for the Comments
entrepreneurs, who still face unique
obstacles in the world of business. collection of information described
60-day notice and request for
ACTION:
Through the management and technical below. The Paperwork Reduction Act
comments.
assistance provided by the WBCs, (PRA) of 1995, requires federal agencies
entrepreneurs (especially women who to publish a notice in the Federal SUMMARY: The Small Business
are economically or socially Register concerning each proposed Administration (SBA) intends to request
disadvantaged) are offered collection of information before approval, from the Office of
comprehensive training and counseling submission to OMB, and to allow 60 Management and Budget (OMB) for the
on a variety of topics in many languages days for public comment in response to collection of information described
sradovich on DSK3GMQ082PROD with NOTICES
to help them start and grow their own the notice. This notice complies with below. The Paperwork Reduction Act
businesses. The SBA plans to conduct a that requirement. (PRA) of 1995, 44 U.S.C. Chapter 35
web-based survey to understand to what DATES: Submit comments on or before requires federal agencies to publish a
degree the Agency’s WBC programs and January 23, 2018. notice in the Federal Register
services help entrepreneurs start, ADDRESSES: Send all comments to concerning each proposed collection of
manage and grow businesses. The Dolores Rowen, Associate Director, information before submission to OMB,
survey will help determine customer Office of Policy and Research, National and to allow 60 days for public
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Document Created: 2017-11-22 23:33:41
Document Modified: 2017-11-22 23:33:41
| 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 55912 |
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