83 FR 26507 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Content of the NYSE Best Quote & Trades Data Feed
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 110 (June 7, 2018)
Federal Register Volume 83, Issue 110 (June 7, 2018)
| Page Range | 26507-26510 | |
| FR Document | 2018-12193 |
[Federal Register Volume 83, Number 110 (Thursday, June 7, 2018)] [Notices] [Pages 26507-26510] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-12193] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-83359; File No. SR-NYSE-2018-22] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Content of the NYSE Best Quote & Trades Data Feed June 1, 2018. 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 18, 2018, New York Stock Exchange LLC (``NYSE'' or the ``Exchange'') 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. --------------------------------------------------------------------------- \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 amend the content of the NYSE Best Quote & Trades (``NYSE BQT'') data feed. The proposed rule change is available on the Exchange's website 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, [[Page 26508]] of the most significant parts 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 proposes to amend the content of NYSE BQT to include data feeds from the Exchange's affiliate, NYSE National, Inc. (``NYSE National''). The Exchange recently filed a proposed rule change to establish NYSE National market data feeds, including NYSE National BBO (``NYSE National BBO'') and NYSE National Trades (``NYSE National Trades'') \4\ and now proposes to amend the content of the NYSE BQT market data feed to include NYSE National BBO and NYSE National Trades. --------------------------------------------------------------------------- \4\ See SR-NYSENat-2018-09. --------------------------------------------------------------------------- The NYSE BQT \5\ data feed currently provides a unified view of best bid and offer (``BBO'') and last sale information for the Exchange and its affiliates, NYSE Arca, Inc. (``NYSE Arca'') and NYSE American LLC (``NYSE American'') and consists of data elements from six existing market data feeds: NYSE Trades,\6\ NYSE BBO,\7\ NYSE Arca Trades,\8\ NYSE Arca BBO,\9\ NYSE American Trades \10\ and NYSE American BBO.\11\ --------------------------------------------------------------------------- \5\ See Securities Exchange Act Release No. 73553 (November 6, 2014), 79 FR 67491 (November 13, 2014) (Notice of Amendment No. 1 and Order Granting Accelerated Approval to a Proposed Rule Change, as Modified by Amendment No. 1, To Establish the NYSE Best Quote and Trades Data Feed). \6\ See Securities Exchange Act Release Nos. 59290 (Jan. 23, 2009), 74 FR 5707 (Jan. 30, 2009) (SR-NYSE-2009-05); 59606 (Mar. 19, 2009), 74 FR 13293 (Mar. 26, 2009) (SR-NYSE-2009-04). \7\ See Securities Exchange Act Release No. 62181 (May 26, 2010), 75 FR 31488 (June 3, 2010) (SR-NYSE-2010-30). \8\ See Securities Exchange Act Release Nos. 59289 (Jan. 23, 2009), 74 FR 5711 (Jan. 30, 2009) (SR-NYSEArca-2009-06); and 59598 (Mar. 18, 2009), 74 FR 12919 (Mar. 25, 2009) (SR-NYSEArca-2009-05). \9\ See Securities Exchange Act Release No. 62188 (May 27, 2010), 75 FR 31484 (June 3, 2010) (SR-NYSEArca-2010-23). \10\ See Securities Exchange Act Release No. 62187 (May 27, 2010), 75 FR 31500 (June 3, 2010) (SR-NYSEAmex-2010-35). \11\ See Securities Exchange Act Release No. 62187 (May 27, 2010), 75 FR 31500 (June 3, 2010) (SR-NYSEAmex-2010-35). --------------------------------------------------------------------------- NYSE BBO, NYSE Arca BBO, and NYSE American BBO are existing data feeds that distribute on a realtime basis the same BBO information that NYSE, NYSE Arca, and NYSE American, respectively, report under the Consolidated Quotation (``CQ'') Plan for inclusion in the CQ Plan's consolidated quotation information data stream. NYSE Trades, NYSE Arca Trades, and NYSE American Trades are existing data feeds that distribute on a real-time basis the same last sale information that NYSE, NYSE Arca, and NYSE American, respectively, report under the Consolidated Tape Association (``CTA'') Plan for inclusion in the CTA Plan's consolidated data streams. The NYSE BQT data feed has three channels: One channel for the last sale data (the ``last sale channel''); another channel for the BBO data (the ``best quotes channel''); and a third channel for consolidated volume data (the ``consolidated volume channel''). The last sale channel provides an aggregation of the same data that is currently available through NYSE Trades, NYSE Arca Trades, and NYSE American Trades. With this proposed rule change, the last sale channel would also include data available through NYSE National Trades. The best quotes channel provides the NYSE BQT BBO, which is the best quote from among the NYSE BBO, NYSE Arca BBO, and NYSE MKT BBO based on the following criteria, in order:Price: The exchange with the highest bid or the lowest offer has overall priority; Size: The largest size takes precedence when multiple exchanges submit the same bid and/or offer price; and Time: The earliest time takes precedence when multiple exchanges submit the same bid and/or offer price with the same sizes. With this proposed rule change, the best quotes channel would also include data available through NYSE National BBO. For each security, the best quotes channel would only include one best bid and one best offer from among the four exchanges. The NYSE BQT BBO would be marked with a market center ID identifying the exchange from which the BBO originated. The consolidated volume channel carries consolidated volume for all listed equities in a manner consistent with the requirements for redistributing such data as set forth in the securities information processor plans. As it does today, NYSE BQT would also provide related data elements for NYSE National, such as trade and security status updates (e.g., trade corrections and trading halts). The Exchange believes that NYSE BQT would continue to provide high- quality, comprehensive last sale and BBO data for the Exchange, NYSE Arca, NYSE American, and now, NYSE National, in a unified view and would respond to subscriber demand for such a product. With respect to cost, the Exchange will file a separate rule filing to amend the fees for NYSE BQT.\12\ To ensure that vendors could continue to compete with the Exchange by creating the same product as NYSE BQT and selling it to their clients, the Exchange would continue to charge its clients for the NYSE BQT feed an amount that represents the cost to a market data vendor to obtain the underlying data feeds, plus an access fee to perform an aggregation and consolidation function that the Exchange performs in creating NYSE BQT. The Exchange believes that a competing vendor could create and offer a product similar to the proposed NYSE BQT data feed at a similar cost. For these reasons, the Exchange continues to believe that vendors could readily offer a product similar to NYSE BQT on a competitive basis. --------------------------------------------------------------------------- \12\ See SR-NYSE-2018-24. --------------------------------------------------------------------------- The Exchange will announce the date through a market data notice that the amended NYSE BQT feed that includes NYSE National BBO and NYSE National Trades data would be available and by when a subscriber must subscribe to NYSE National BBO and NYSE National Trades to continue receiving NYSE BQT. This proposed change to NYSE BQT will not be operative until NYSE National has established the NYSE National BBO and NYSE National Trades and related fees via a proposed rule change(s) and NYSE National has re-launched operations. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) \13\ of the Act (``Act''), in general, and furthers the objectives of Section 6(b)(5) \14\ of the Act, 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, and it is not designed to permit unfair discrimination among customers, brokers, or dealers. This proposal is in keeping with those principles in that it promotes increased transparency through the dissemination of the NYSE BQT market data feed to those interested in receiving it. --------------------------------------------------------------------------- \13\ 15 U.S.C. 78f(b). \14\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The NYSE BQT data feed is a product that relies on the Exchange's receipt of [[Page 26509]] underlying data, which is available to all market participants, before it can aggregate and consolidate information to create the NYSE BQT; this is a process that a vendor could also perform. Accordingly, the Exchange is not the only distributor of the NYSE BQT data feed. The Exchange believes that the proposed rule change is consistent with Rule 603 of Regulation NMS,\15\ which provides that any national securities exchange that distributes information with respect to quotations for or transactions in an NMS stck [sic] do so on terms that are not unreasonably discriminatory. In adopting Regulation NMS, the Commission granted self-regulatory organizations (``SROs'') and broker dealers increased authority and flexibility to offer new and unique market data to consumers of such data. It was believed that this authority would expand the amount of data available to users and consumers of such data and also spur innovation and competition for the provision of market data. --------------------------------------------------------------------------- \15\ 17 CFR 242.603. --------------------------------------------------------------------------- The Exchange further notes that the existence of alternatives to the Exchange's product, including real-time consolidated data, free delayed consolidated data, and proprietary data from other sources, as well as the continued availability of the Exchange's separate data feeds, ensures that the Exchange is not unreasonably discriminatory because vendors and subscribers can elect these alternatives as their individual business cases warrant. Additionally, the Exchange has taken into consideration its affiliated relationship with NYSE Arca, NYSE American and NYSE National in its design of the NYSE BQT data feed to assure that similarly situated competing vendors would be able to offer a similar product on the same terms as the Exchange, both from the perspective of latency and cost. The Exchange believes that NYSE BQT offers an alternative to the use of consolidated data products and proprietary data products such as NASDAQ Basic and NLS Plus. NASDAQ Basic, which is offered by The NASDAQ Stock Market, Inc. (``NASDAQ'') provides best bid and offer and last sale information for all U.S. exchange-listed securities (including NYSE and its affiliates) based on liquidity within NASDAQ, as well as trades reported to the FINRA/NASDAQ Trade Reporting Facility (``TRF''), including NASDAQ last sale, NASDAQ BBO, NASDAQ opening and closing prices, and other market status information.\16\ Further, NLS Plus provides all trade data from NASDAQ, the FINRA/NASDAQ TRF, NASDAQ BX, and NASDAQ PSX, as well as consolidated volume information as part of each trade message.\17\ --------------------------------------------------------------------------- \16\ See NASDAQ Basic, available at http://business.nasdaq.com/intel/market-data-feeds/Equities-Market-Data/basic. \17\ See NLS Plus, available at http://www.nasdaqtrader.com/Trader.aspx?id=NLSplus. --------------------------------------------------------------------------- Cboe Global Markets, Inc. (``Cboe'') also offers a market data product that provides a unified view of the aggregated quote and trade updates for all the Cboe equity exchanges.\18\ The Exchange believes that NYSE BQT offers a competitive alternative to the two existing NASDAQ products and the Cboe product. --------------------------------------------------------------------------- \18\ See https://markets.cboe.com/us/equities/market_data_products/bats_one/. The Cboe Equities One Premium Feed also includes five levels of aggregate depth information for all four Cboe exchanges. --------------------------------------------------------------------------- In addition, this proposal would not permit unfair discrimination because NYSE BQT will continue to be available to all of the Exchange's customers through SFTI and market data vendors on an equivalent basis. In addition, any customer that wished to continue to be able to purchase one or more of the individual underlying data feeds would be able to do so. B. Self-Regulatory Organization's Statement on Burden on Competition In accordance with Section 6(b)(8) of the Act,\19\ 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 will enhance competition because it would enable the Exchange to include NYSE National BBO and NYSE National Trades as part of NYSE BQT, thereby enabling it to better compete with market data products offered by NASDAQ and Cboe.\20\ As noted above, the Exchange already offers NYSE BQT and this proposed rule change simply amends the content of the current market data product to include data elements from two additional data feeds from the Exchange's affiliate, NYSE National. Although the Exchange, NYSE Arca, NYSE American and NYSE National are the exclusive distributors of the eight BBO and Trades feeds from which certain data elements are taken to create NYSE BQT, the Exchange would not be the exclusive distributor of the aggregated and consolidated information that would compose the amended NYSE BQT data feed. Vendors would be able, if they chose, to create a data feed with the same information as NYSE BQT and distribute it to their clients on a level- playing field with respect to latency and cost as compared to the Exchange's product. --------------------------------------------------------------------------- \19\ 15 U.S.C. 78f(b)(8). \20\ See supra notes 16-18. --------------------------------------------------------------------------- With respect to latency, the Exchange, NYSE Arca, NYSE American and NYSE National are located in the same data center in Mahwah, New Jersey. The system creating and supporting the NYSE BQT data feed would need to obtain the eight underlying data feeds from the four exchanges before it could aggregate and consolidate information to create NYSE BQT and then distribute it to end users. Likewise, a competing market data vendor co-located at the Exchange's Mahwah, New Jersey facility could perform the aggregation and consolidation function in the Mahwah facility and redistribute a competing product from that location to similarly situated customers on a level-playing field with respect to the speed that the Exchange could create and redistribute the NYSE BQT data feed. The Exchange believes that NYSE BQT will continue to promote competition among exchanges by offering an alternative to NASDAQ Basic, NLS Plus and Cboe Equites One Feed.\21\ For these reasons, the Exchange believes that NYSE BQT will continue to promote, rather than unnecessarily or inappropriately burden, competition for market data products that are offered in the capacity as a vendor and are not core exchange market data products. --------------------------------------------------------------------------- \21\ See supra notes 16-18. --------------------------------------------------------------------------- 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 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 \22\ and Rule 19b-4(f)(6) thereunder.\23\ --------------------------------------------------------------------------- \22\ 15 U.S.C. 78s(b)(3)(A). \23\ 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. --------------------------------------------------------------------------- [[Page 26510]] A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the Act \24\ normally does not become operative for 30 days after the date of its filing. However, Rule 19b-4(f)(6)(iii) \25\ permits the Commission to 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 so that the proposed rule change may become operative upon filing. The Exchange states that waiver of the operative delay would be consistent with the protection of investors and the public interest because it will allow the Exchange to provide an amended NYSE BQT market data feed that will include the NYSE National Market Data Feeds immediately upon launch of NYSE National, which the Exchange states is intended in May 2018, and will further allow the Exchange to compete directly with the similar NASDAQ and Cboe market data products on a timely basis. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest. Therefore, the Commission hereby waives the operative delay and designates the proposal as operative upon filing.\26\ --------------------------------------------------------------------------- \24\ 17 CFR 240.19b-4(f)(6). \25\ 17 CFR 240.19b-4(f)(6)(iii). \26\ 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). --------------------------------------------------------------------------- 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-NYSE-2018-22 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-NYSE-2018-22. 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 website (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 website 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-NYSE-2018-22, and should be submitted on or before June 28, 2018. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\27\ --------------------------------------------------------------------------- \27\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-12193 Filed 6-6-18; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 83, No. 110 / Thursday, June 7, 2018 / Notices 26507
secondary market trading in shares does and Redemption Instruments will be For the Commission, by the Division of
not involve a Fund as a party and will valued in the same manner as those Investment Management, under delegated
not result in dilution of an investment Portfolio Instruments currently held by authority.
in shares, and (b) to the extent different the Funds. Applicants also seek relief Eduardo A. Aleman,
prices exist during a given trading day, from the prohibitions on affiliated Assistant Secretary.
or from day to day, such variances occur transactions in section 17(a) to permit a [FR Doc. 2018–12191 Filed 6–6–18; 8:45 am]
as a result of third-party market forces, Fund to sell its shares to and redeem its BILLING CODE 8011–01–P
such as supply and demand. Therefore, shares from a Fund of Funds, and to
applicants assert that secondary market engage in the accompanying in-kind
transactions in shares will not lead to transactions with the Fund of Funds.2 SECURITIES AND EXCHANGE
discrimination or preferential treatment The purchase of Creation Units by a COMMISSION
among purchasers. Finally, applicants Fund of Funds directly from a Fund will
represent that share market prices will [Release No. 34–83359; File No. SR–NYSE–
be accomplished in accordance with the
be disciplined by arbitrage 2018–22]
policies of the Fund of Funds and will
opportunities, which should prevent
shares from trading at a material be based on the NAVs of the Funds. Self-Regulatory Organizations; New
discount or premium from NAV. 9. Applicants also request relief to York Stock Exchange LLC; Notice of
6. With respect to Funds that hold permit a Feeder Fund to acquire shares Filing and Immediate Effectiveness of
non-U.S. Portfolio Instruments and that of another registered investment Proposed Rule Change To Amend the
effect creations and redemptions of company managed by the Adviser Content of the NYSE Best Quote &
Creation Units in kind, applicants having substantially the same Trades Data Feed
request relief from the requirement investment objectives as the Feeder
imposed by section 22(e) in order to June 1, 2018.
Fund (‘‘Master Fund’’) beyond the
allow such Funds to pay redemption limitations in section 12(d)(1)(A) and Pursuant to Section 19(b)(1) 1 of the
proceeds within fifteen calendar days permit the Master Fund, and any Securities Exchange Act of 1934 (the
following the tender of Creation Units ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
principal underwriter for the Master
for redemption. Applicants assert that notice is hereby given that on May 18,
Fund, to sell shares of the Master Fund
the requested relief would not be 2018, New York Stock Exchange LLC
to the Feeder Fund beyond the
inconsistent with the spirit and intent of (‘‘NYSE’’ or the ‘‘Exchange’’) filed with
limitations in section 12(d)(1)(B).
section 22(e) to prevent unreasonable, the Securities and Exchange
undisclosed or unforeseen delays in the 10. Section 6(c) of the Act permits the Commission (‘‘Commission’’) the
actual payment of redemption proceeds. Commission to exempt any persons or proposed rule change as described in
7. Applicants request an exemption to transactions from any provision of the Items I and II below, which Items have
permit Funds of Funds to acquire Fund Act if such exemption is necessary or been prepared by the self-regulatory
shares beyond the limits of section appropriate in the public interest and organization. The Commission is
12(d)(1)(A) of the Act; and the Funds, consistent with the protection of publishing this notice to solicit
and any principal underwriter for the investors and the purposes fairly comments on the proposed rule change
Funds, and/or any broker or dealer intended by the policy and provisions of from interested persons.
registered under the Exchange Act, to the Act. Section 12(d)(1)(J) of the Act
I. Self-Regulatory Organization’s
sell shares to Funds of Funds beyond provides that the Commission may
Statement of the Terms of the Substance
the limits of section 12(d)(1)(B) of the exempt any person, security, or
of the Proposed Rule Change
Act. The application’s terms and transaction, or any class or classes of
conditions are designed to, among other persons, securities, or transactions, from The Exchange proposes to amend the
things, help prevent any potential (i) any provision of section 12(d)(1) if the content of the NYSE Best Quote &
undue influence over a Fund through exemption is consistent with the public Trades (‘‘NYSE BQT’’) data feed. The
control or voting power, or in interest and the protection of investors. proposed rule change is available on the
connection with certain services, Section 17(b) of the Act authorizes the Exchange’s website at www.nyse.com, at
transactions, and underwritings, (ii) Commission to grant an order the principal office of the Exchange, and
excessive layering of fees, and (iii) permitting a transaction otherwise at the Commission’s Public Reference
overly complex fund structures, which prohibited by section 17(a) if it finds Room.
are the concerns underlying the limits that (a) the terms of the proposed II. Self-Regulatory Organization’s
in sections 12(d)(1)(A) and (B) of the transaction are fair and reasonable and
Act. Statement of the Purpose of, and
do not involve overreaching on the part Statutory Basis for, the Proposed Rule
8. Applicants request an exemption
of any person concerned; (b) the Change
from sections 17(a)(1) and 17(a)(2) of the
Act to permit a person who is an proposed transaction is consistent with
In its filing with the Commission, the
affiliated person, as defined in section the policies of each registered
self-regulatory organization included
2(a)(3) of the Act (‘‘Affiliated Person’’), investment company involved; and (c)
statements concerning the purpose of,
or an affiliated person of an Affiliated the proposed transaction is consistent and basis for, the proposed rule change
Person (‘‘Second-Tier Affiliate’’), of the with the general purposes of the Act. and discussed any comments it received
Funds, solely by virtue of certain on the proposed rule change. The text
2 The requested relief would apply to direct sales
ownership interests, to effectuate
sradovich on DSK3GMQ082PROD with NOTICES
of those statements may be examined at
of shares in Creation Units by a Fund to a Fund of
purchases and redemptions in-kind. The Funds and redemptions of those shares. Applicants, the places specified in Item IV below.
deposit procedures for in-kind moreover, are not seeking relief from section 17(a) The Exchange has prepared summaries,
purchases of Creation Units and the for, and the requested relief will not apply to, set forth in sections A, B, and C below,
redemption procedures for in-kind transactions where a Fund could be deemed an
Affiliated Person, or a Second-Tier Affiliate, of a
redemptions of Creation Units will be Fund of Funds because an investment adviser to the
1 15 U.S.C.78s(b)(1).
the same for all purchases and Funds is also an investment adviser to a Fund of 2 15 U.S.C. 78a.
redemptions and Deposit Instruments Funds. 3 17 CFR 240.19b–4.
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underlying data, which is available to information.16 Further, NLS Plus amended NYSE BQT data feed. Vendors
all market participants, before it can provides all trade data from NASDAQ, would be able, if they chose, to create
aggregate and consolidate information to the FINRA/NASDAQ TRF, NASDAQ a data feed with the same information
create the NYSE BQT; this is a process BX, and NASDAQ PSX, as well as as NYSE BQT and distribute it to their
that a vendor could also perform. consolidated volume information as part clients on a level-playing field with
Accordingly, the Exchange is not the of each trade message.17 respect to latency and cost as compared
only distributor of the NYSE BQT data Cboe Global Markets, Inc. (‘‘Cboe’’) to the Exchange’s product.
feed. also offers a market data product that With respect to latency, the Exchange,
The Exchange believes that the provides a unified view of the NYSE Arca, NYSE American and NYSE
proposed rule change is consistent with aggregated quote and trade updates for National are located in the same data
Rule 603 of Regulation NMS,15 which all the Cboe equity exchanges.18 The center in Mahwah, New Jersey. The
provides that any national securities Exchange believes that NYSE BQT offers system creating and supporting the
exchange that distributes information a competitive alternative to the two NYSE BQT data feed would need to
with respect to quotations for or existing NASDAQ products and the obtain the eight underlying data feeds
transactions in an NMS stck [sic] do so Cboe product. from the four exchanges before it could
on terms that are not unreasonably In addition, this proposal would not aggregate and consolidate information to
discriminatory. In adopting Regulation permit unfair discrimination because create NYSE BQT and then distribute it
NMS, the Commission granted self- NYSE BQT will continue to be available to end users. Likewise, a competing
regulatory organizations (‘‘SROs’’) and to all of the Exchange’s customers market data vendor co-located at the
broker dealers increased authority and through SFTI and market data vendors Exchange’s Mahwah, New Jersey facility
flexibility to offer new and unique on an equivalent basis. In addition, any could perform the aggregation and
market data to consumers of such data. customer that wished to continue to be consolidation function in the Mahwah
It was believed that this authority would able to purchase one or more of the facility and redistribute a competing
expand the amount of data available to individual underlying data feeds would product from that location to similarly
users and consumers of such data and be able to do so. situated customers on a level-playing
also spur innovation and competition B. Self-Regulatory Organization’s field with respect to the speed that the
for the provision of market data. Statement on Burden on Competition Exchange could create and redistribute
The Exchange further notes that the the NYSE BQT data feed.
In accordance with Section 6(b)(8) of The Exchange believes that NYSE
existence of alternatives to the the Act,19 the Exchange does not believe BQT will continue to promote
Exchange’s product, including real-time that the proposed rule change will competition among exchanges by
consolidated data, free delayed impose any burden on competition that offering an alternative to NASDAQ
consolidated data, and proprietary data is not necessary or appropriate in Basic, NLS Plus and Cboe Equites One
from other sources, as well as the furtherance of the purposes of the Act. Feed.21 For these reasons, the Exchange
continued availability of the Exchange’s The Exchange believes that the believes that NYSE BQT will continue
separate data feeds, ensures that the proposed rule change will enhance to promote, rather than unnecessarily or
Exchange is not unreasonably competition because it would enable the inappropriately burden, competition for
discriminatory because vendors and Exchange to include NYSE National market data products that are offered in
subscribers can elect these alternatives BBO and NYSE National Trades as part the capacity as a vendor and are not
as their individual business cases of NYSE BQT, thereby enabling it to core exchange market data products.
warrant. Additionally, the Exchange has better compete with market data
taken into consideration its affiliated products offered by NASDAQ and C. Self-Regulatory Organization’s
relationship with NYSE Arca, NYSE Cboe.20 As noted above, the Exchange Statement on Comments on the
American and NYSE National in its already offers NYSE BQT and this Proposed Rule Change Received From
design of the NYSE BQT data feed to proposed rule change simply amends Members, Participants, or Others
assure that similarly situated competing the content of the current market data No written comments were solicited
vendors would be able to offer a similar product to include data elements from or received with respect to the proposed
product on the same terms as the two additional data feeds from the rule change.
Exchange, both from the perspective of Exchange’s affiliate, NYSE National.
latency and cost. Although the Exchange, NYSE Arca, III. Date of Effectiveness of the
The Exchange believes that NYSE NYSE American and NYSE National are Proposed Rule Change and Timing for
BQT offers an alternative to the use of the exclusive distributors of the eight Commission Action
consolidated data products and BBO and Trades feeds from which Because the proposed rule change
proprietary data products such as certain data elements are taken to create does not (i) significantly affect the
NASDAQ Basic and NLS Plus. NYSE BQT, the Exchange would not be protection of investors or the public
NASDAQ Basic, which is offered by The the exclusive distributor of the interest; (ii) impose any significant
NASDAQ Stock Market, Inc. aggregated and consolidated burden on competition; and (iii) become
(‘‘NASDAQ’’) provides best bid and information that would compose the operative for 30 days from the date on
offer and last sale information for all which it was filed, or such shorter time
U.S. exchange-listed securities 16 See NASDAQ Basic, available at http:// as the Commission may designate, it has
(including NYSE and its affiliates) based business.nasdaq.com/intel/market-data-feeds/ become effective pursuant to Section
Equities-Market-Data/basic.
on liquidity within NASDAQ, as well as 19(b)(3)(A) of the Act 22 and Rule 19b–
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17 See NLS Plus, available at http://
trades reported to the FINRA/NASDAQ www.nasdaqtrader.com/Trader.aspx?id=NLSplus. 4(f)(6) thereunder.23
Trade Reporting Facility (‘‘TRF’’), 18 See https://markets.cboe.com/us/equities/
including NASDAQ last sale, NASDAQ market_data_products/bats_one/. The Cboe 21 See supra notes 16–18.
BBO, NASDAQ opening and closing Equities One Premium Feed also includes five 22 15 U.S.C. 78s(b)(3)(A).
levels of aggregate depth information for all four 23 17 CFR 240.19b–4(f)(6). As required under Rule
prices, and other market status Cboe exchanges. 19b–4(f)(6)(iii), the Exchange provided the
19 15 U.S.C. 78f(b)(8).
Commission with written notice of its intent to file
15 17 CFR 242.603. 20 See supra notes 16–18. Continued
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![26510 Federal Register / Vol. 83, No. 110 / Thursday, June 7, 2018 / Notices
A proposed rule change filed Electronic Comments SECURITIES AND EXCHANGE
pursuant to Rule 19b–4(f)(6) under the COMMISSION
Act 24 normally does not become • Use the Commission’s internet
comment form (http://www.sec.gov/ [SEC File No. 270–233, OMB Control No.
operative for 30 days after the date of its 3235–0223]
filing. However, Rule 19b–4(f)(6)(iii) 25 rules/sro.shtml); or
permits the Commission to designate a • Send an email to rule-comments@ Submission for OMB Review;
shorter time if such action is consistent sec.gov. Please include File Number SR– Comment Request
with the protection of investors and the NYSE–2018–22 on the subject line.
Upon Written Request, Copies Available
public interest. The Exchange has asked
Paper Comments From: Securities and Exchange
the Commission to waive the 30-day Commission, Office of FOIA Services,
operative delay so that the proposed • Send paper comments in triplicate 100 F Street NE, Washington, DC
rule change may become operative upon to Secretary, Securities and Exchange 20549–2736
filing. The Exchange states that waiver Commission, 100 F Street NE, Extension:
of the operative delay would be Washington, DC 20549–1090. Rule 17f–2
consistent with the protection of
investors and the public interest All submissions should refer to File Notice is hereby given that, pursuant
because it will allow the Exchange to Number SR–NYSE–2018–22. This file to the Paperwork Reduction Act of 1995
provide an amended NYSE BQT market number should be included on the (44 U.S.C. 350l et seq.), the Securities
data feed that will include the NYSE subject line if email is used. To help the and Exchange Commission (the
Commission process and review your ‘‘Commission’’) has submitted to the
National Market Data Feeds
comments more efficiently, please use Office of Management and Budget a
immediately upon launch of NYSE
only one method. The Commission will request for extension of the previously
National, which the Exchange states is approved collection of information
intended in May 2018, and will further post all comments on the Commission’s
internet website (http://www.sec.gov/ discussed below.
allow the Exchange to compete directly Rule 17f–2 (17 CFR 270.17f–2),
with the similar NASDAQ and Cboe rules/sro.shtml). Copies of the
entitled ‘‘Custody of Investments by
market data products on a timely basis. submission, all subsequent Registered Management Investment
The Commission believes that waiving amendments, all written statements Company,’’ was adopted in 1940 under
the 30-day operative delay is consistent with respect to the proposed rule section 17(f) of the Investment Company
with the protection of investors and the change that are filed with the Act of 1940 (15 U.S.C. 80a–17(f)) (the
public interest. Therefore, the Commission, and all written ‘‘Act’’), and was last amended
Commission hereby waives the communications relating to the materially in 1947. Rule 17f–2
operative delay and designates the proposed rule change between the establishes safeguards for arrangements
proposal as operative upon filing.26 Commission and any person, other than in which a registered management
At any time within 60 days of the those that may be withheld from the investment company (‘‘fund’’) is
filing of the proposed rule change, the public in accordance with the deemed to maintain custody of its own
provisions of 5 U.S.C. 552, will be assets, such as when the fund maintains
Commission summarily may
available for website viewing and its assets in a facility that provides
temporarily suspend such rule change if
printing in the Commission’s Public safekeeping but not custodial services.1
it appears to the Commission that such The rule includes several recordkeeping
action is necessary or appropriate in the Reference Room, 100 F Street NE,
Washington, DC 20549 on official or reporting requirements. The fund’s
public interest, for the protection of directors must prepare a resolution
investors, or otherwise in furtherance of business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the designating not more than five fund
the purposes of the Act. If the officers or responsible employees who
Commission takes such action, the filing also will be available for
may have access to the fund’s assets.
Commission shall institute proceedings inspection and copying at the principal
The designated access persons (two or
to determine whether the proposed rule office of the Exchange. All comments
more of whom must act jointly when
should be approved or disapproved. received will be posted without change. handling fund assets) must prepare a
Persons submitting comments are written notation providing certain
IV. Solicitation of Comments cautioned that we do not redact or edit information about each deposit or
Interested persons are invited to personal identifying information from withdrawal of fund assets, and must
submit written data, views, and comment submissions. You should transmit the notation to another officer
arguments concerning the foregoing, submit only information that you wish or director designated by the directors.
including whether the proposed rule to make available publicly. All An independent public accountant must
change is consistent with the Act. submissions should refer to File verify the fund’s assets three times each
Comments may be submitted by any of Number SR–NYSE–2018–22, and year, and two of those examinations
the following methods: should be submitted on or before June must be unscheduled.2
28, 2018.
1 The rule generally requires all assets to be
the proposed rule change, along with a brief For the Commission, by the Division of deposited in the safekeeping of a ‘‘bank or other
description and the text of the proposed rule Trading and Markets, pursuant to delegated company whose functions and physical facilities
change, at least five business days prior to the date are supervised by Federal or State authority.’’ The
authority.27
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of filing of the proposed rule change, or such fund’s securities must be physically segregated at
shorter time as designated by the Commission. Eduardo A. Aleman, all times from the securities of any other person.
24 17 CFR 240.19b–4(f)(6).
Assistant Secretary. 2 The accountant must transmit to the
25 17 CFR 240.19b–4(f)(6)(iii).
[FR Doc. 2018–12193 Filed 6–6–18; 8:45 am] Commission promptly after each examination a
26 For purposes only of waiving the 30-day certificate describing the examination on Form N–
operative delay, the Commission has also BILLING CODE 8011–01–P 17f–2. The third (scheduled) examination may
considered the proposed rule’s impact on coincide with the annual verification required for
efficiency, competition, and capital formation. See every fund by section 30(g) of the Act (15 U.S.C.
15 U.S.C. 78c(f). 27 17 CFR 200.30–3(a)(12). 80a–29(g)).
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Document Created: 2018-06-07 00:50:00
Document Modified: 2018-06-07 00:50:00
| 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 | 83 FR 26507 |
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