83 FR 5655 - Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify the Default Handling of Market Orders Entered With a Time-in-Force of DAY
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 27 (February 8, 2018)
Federal Register Volume 83, Issue 27 (February 8, 2018)
| Page Range | 5655-5658 | |
| FR Document | 2018-02483 |
[Federal Register Volume 83, Number 27 (Thursday, February 8, 2018)] [Notices] [Pages 5655-5658] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-02483] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82623; File No. SR-IEX-2018-01] Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify the Default Handling of Market Orders Entered With a Time-in-Force of DAY February 2, 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 January 22, 2018, the Investors Exchange LLC (``IEX'' or the ``Exchange'') filed with the Securities and Exchange Commission (the ``Commission'') the proposed rule change as described in Items I, II and III below, which Items have been prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change Pursuant to the provisions of Section 19(b)(1) under the Securities Exchange Act of 1934 (``Act''),\4\ and Rule 19b-4 thereunder,\5\ Investors Exchange LLC (``IEX'' or ``Exchange'') is filing with the Securities and Exchange Commission (``Commission'') a proposed rule change to modify the default handling of market orders \6\ entered with a time-in-force of DAY.\7\ The Exchange has designated this rule change as ``non-controversial'' under Section 19(b)(3)(A) of the Act \8\ and provided the Commission with the notice required by Rule 19b-4(f)(6) thereunder.\9\ The text of the proposed [[Page 5656]] rule change is available at the Exchange's website at www.iextrading.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. --------------------------------------------------------------------------- \4\ 15 U.S.C. 78s(b)(1). \5\ 17 CRF 240.19b-4. \6\ See Rule 11.190(a)(2). \7\ See Rule 11.190(c)(3). \8\ 15 U.S.C. 78s(b)(3)(A). \9\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- II. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statement may be examined at the places specified in Item IV below. The self-regulatory organization has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this proposed rule change is to modify the default handling of market orders entered with a time-in-force of DAY (hereinafter referred to as ``market DAY orders''). Pursuant to Rule 11.190(a)(2), the Exchange offers Users a market order, which is an order type that allows Users to buy or sell a stated amount of a security that is to be executed at or better than the NBBO at the time the order reaches the Exchange.\10\ Specifically, pursuant to Rule 11.190(a)(2), market orders do not trade through Protected Quotations,\11\ consistent with Rule 611(a)(1) of Regulation NMS.\12\ Moreover, any portion of a market order that is designated as an IEX Only order \13\ will be canceled if, upon receipt by the System,\14\ it cannot be executed by the Exchange in accordance with the Exchange's order execution rules.\15\ Any portion of a market order that is not designated as an IEX Only order (i.e., routable orders as described in IEX Rule 11.230(b)) that cannot be executed in full in accordance with the Exchange's order execution rules when reaching the Exchange will be eligible for routing away pursuant to IEX Rule 11.230(a)(2). A routable market order will trade at increasingly aggressive prices, fully satisfying all Protected Quotations, until the order is fully filled, reaches the LULD Price Band,\16\ or reaches the Router Constraint.\17\ --------------------------------------------------------------------------- \10\ A market order is always non displayed, may be a MQTY (as defined in Rule 11.190(b)(11)), may be routable or IEX Only, may not be designated as an ISO (as defined in Rule 11.190(b)(12)), and may not be submitted with a limit price. See Rules 11.190(a)(2)(B)-(D), and (F)-(G). \11\ See Rule 1.160(bb) \12\ See 17 CFR 242.611(a)(1). \13\ See Rule 11.190(b)(6). \14\ See Rule 1.160(nn). \15\ See Rules 11.230 and 11.230(a). \16\ See Rule 11.280(e)(5)(A). \17\ See Rule 11.190(f)(2). --------------------------------------------------------------------------- Pursuant to Rule 11.190(a)(2)(A), market orders must have a time- in-force of IOC, FOK, or, DAY, depending on the User election.\18\ Pursuant to Rule 11.190(a)(2)(E)(iii), market DAY orders, by default, are rejected, unless the User specifically elects to configure one or more of its connectivity ports to accept market DAY orders.\19\ Market orders with a time-in-force of IOC and FOK are accepted and eligible to trade during the Regular Market Session only.\20\ Market DAY orders are eligible to trade or route during the Regular Market Session and treated by the System as having a time-in-force of IOC. Furthermore, market DAY orders submitted before the open of the Regular Market Session are queued by the System until the Opening Auction (or Halt Auction, as applicable) \21\ for IEX-listed securities, or until the Opening Process for non-IEX listed securities pursuant to IEX Rule 11.231, except market DAY orders that are designated to route pursuant to Rule 11.230(c). --------------------------------------------------------------------------- \18\ Market orders with a time-in-force of GTT, GTX, and SYS, are rejected. See Rules 11.190(a)(2)(E)(iv)-(vi). \19\ A User can elect for the Exchange to accept market orders with a time-in-force of DAY on the Equities Port Request Form on pages 8-9 of its initial IEX Connectivity Agreement and Forms. A User may also change an existing connectivity port to accept market orders with a time-in-force of DAY by submitting an updated Equities Port Request Form to [email protected]. \20\ See Rule 1.160(gg). \21\ See Rule 11.350(c). --------------------------------------------------------------------------- Furthermore, pursuant to Rule 11.190(f)(1), market orders, including market DAY orders entered during continuous trading are subject to the IEX Order Collar, which prevents any incoming order or order resting on the Order Book, including those marked ISO, from executing at a price outside the Order Collar price range (i.e. prevents buy orders from trading at prices above the collar and prevents sell orders from trading at prices below the collar). The order collar price range is calculated using the numerical guidelines for clearly erroneous executions. The default treatment for market DAY orders was implemented based on informal discussions with various market participants who indicated that such orders are not typically utilized by market participants during continuous trading because of their aggressive trading characteristics. As a result, the Exchange determined that the default treatment for market DAY orders was appropriate. On August 4, 2017, the Commission approved a proposed rule change filed by the Exchange to adopt rules governing auctions for IEX-listed securities, including Opening and Closing Auction processes that establish IEX Official Opening and Closing Prices for each trading day, as well as IPO, Halt, and Volatility Auction processes utilized to conduct initial public offerings, and resume trading after a regulatory trading halt or pause in an IEX-listed security (collectively, ``IEX Auctions'').\22\ --------------------------------------------------------------------------- \22\ See Securities Exchange Act Release No. 81316 (August 4, 2017), 82 FR 37474 (August 10, 2017)(SR-IEX-2017-10). See also Rules 11.350(a)(12) and (10), respectively. --------------------------------------------------------------------------- During the iterative process of designing IEX Auctions, informal discussions with various market participants indicated that notwithstanding the atypical use-case for the entry of market DAY orders during continuous trading, such orders are in fact ordinarily utilized by investors to interact with the auction processes of certain primary listing markets, because market DAY orders retain their aggressive pricing characteristics, which increases the likelihood of execution and adds depth of liquidity in the auction, while remaining constrained to the auction match price, therefore passively benefiting from the price discovery process.\23\ Accordingly, as proposed, the Exchange will instead allow all connectivity port sessions across all Members to accept market DAY orders by default. --------------------------------------------------------------------------- \23\ See e.g., Cboe BZX Exchange, Inc. (``Bats'') Rules 11.9(a)(2) and 11.23(a)(8). --------------------------------------------------------------------------- Accordingly, the Exchange designed the IEX Auction processes to account for market DAY orders by queueing such orders on the Auction Book \24\ for participation in an upcoming auction when the order type is not eligible for trading in the current market session (i.e., during the Pre-Market Session for the Opening Auction), or when there is no active continuous trading (i.e., during the Order Acceptance Period \25\ before an IPO, Halt, or Volatility Auction), and then immediately canceling any unfilled portion immediately after the auction. This design allows Users to leverage the benefits of interacting with the IEX Auction processes using market DAY orders while mitigating the potentially [[Page 5657]] harmful impact of such orders that could manifest during continuous trading. Specifically, pursuant to Rule 11.350(a)(1): --------------------------------------------------------------------------- \24\ See Rule 11.350(a)(1). \25\ See Rules 11.1350(a)(29)(A)-(C).The Opening and IPO Auction Books include market orders with a time-in-force of DAY entered during the Order Acceptance Period, and in the case of the Opening Auction, before the Opening Auction Lock-In Time; \26\ --------------------------------------------------------------------------- \26\ See Rule 11.350(a)(22). --------------------------------------------------------------------------- The Halt Auction Book includes market orders with a time-in-force of DAY received during the Order Acceptance Period within the Regular Market Session, or queued prior to the Regular Market Session for securities that have not traded during the Regular Market Session on that trading day (i.e., market orders with a time-in-force of DAY entered during the Pre-Market Session for the Opening Auction that are participating in a Halt Auction pursuant to Rule 11.350(c)(2)(D) or (E)(ii)); and The Volatility Auction Book includes market orders with a time-in-force of DAY received during the Order Acceptance Period within the Regular Market Session. However, if a User does not have their connectivity ports properly configured to allow market DAY orders, such auction interest would be rejected by default. While, as noted above, a User can elect for the Exchange to accept market DAY orders by submitting an Equities Port Request Form, the process of making system changes to modify, test, and deploy the configuration adds additional complexity for Members and the Exchange. Therefore, to simplify User interaction with the System and allow Users to efficiently leverage the benefits of interacting with the IEX Auction processes using market DAY orders, the Exchange is proposing to eliminate the default rejection of market DAY orders and the corresponding User elected connectivity port settings for the acceptance of market DAY orders. As proposed, the Exchange will instead allow all connectivity port sessions across all Members to accept market DAY orders by default. The proposed changes do not amend the behavior of market DAY orders, as described above. Moreover, notwithstanding the potentially aggressive trading characteristics of market orders generally, the Exchange believes that there are sufficient limitations on execution of market orders, as described above, to mitigate against such concerns. As announced in IEX Trading Alerts #2017-015 and #2017-046, the Exchange intends to become a primary listing exchange and support its first IEX-listed security in 2018.\27\ In addition, as part of the listings initiative, the Exchange is providing a series of industry wide weekend tests for the Exchange and its Members to exercise the various technology changes required to support IEX Auctions and listings functionality.\28\ Accordingly, the Exchange is proposing to amend the default acceptance of market DAY orders in advance of the industry wide testing period in order to allow Members and other market participants time to develop, test, and deploy any necessary changes to support the handling of market DAY orders for participation in IEX Auctions. --------------------------------------------------------------------------- \27\ See IEX Trading Alert #2017-015 (Listings Specifications, Testing Opportunities, and Timelines), May 31, 2017. See also IEX Trading Alert #2017-046 (IEX Listings Timeline Update), originally published on Monday, October 30, 2017, and re-published on Tuesday, October 31, 2017. \28\ See, e.g., IEX Trading Alert #2017-028 (First Listings Functionality Industry Test on Saturday, August 26), August 17, 2017; IEX Trading Alert #2017-037 (Second Listings Functionality Industry Test on Saturday, September 9), September 7, 2017; IEX Trading Alert #2017-039 (Third Listings Functionality Industry Test on Saturday, September 23), September 18, 2017; IEX Trading Alert #2017-040 (Rescheduled 4th Listing Functionality Industry Test), September 29, 2017; IEX Trading Alert #2017-046 (IEX Listings Timeline Update), originally published on Monday, October 30, 2017, and re-published on Tuesday, October 31, 2017; and IEX Trading Alert #2017-047 (Fourth Listings Functionality Industry Test on Saturday, November 4), October 31, 2017. --------------------------------------------------------------------------- 2. Statutory Basis IEX believes that the proposed rule change is consistent with the provisions of Section 6(b) \29\ of the Act in general, and furthers the objectives of Section 6(b)(5) of the Act \30\ in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, 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. --------------------------------------------------------------------------- \29\ 15 U.S.C. 78f. \30\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The proposed rule change is consistent with the protection of investors and the public interest, because it does not alter the substantive behavior of market DAY orders, but instead simplifies the process of entering market DAY orders for all Members. Specifically, the proposed changes are designed to simplify User interaction with the System and allow Users to efficiently leverage the benefits of interacting with the IEX Auction processes by eliminating the default rejection of market DAY orders and the corresponding User elected connectivity port settings for the acceptance of market DAY orders. The Exchange further believes that since the proposed changes do not amend the behavior of market DAY orders, the proposed rule changes are consistent with the protection of investors and the public interest because the limitations on execution of market orders, as discussed in the purpose section, would continue to mitigate against potential adverse market impact from such orders during continuous trading. Additionally, IEX notes that no other exchange utilizes default rejection of orders comparable to market DAY order types.\31\ --------------------------------------------------------------------------- \31\ See, e.g., Bats Rule 11.9(a)(2). --------------------------------------------------------------------------- Moreover, the Exchange believes that the proposed rule changes are consistent with the protection of investors and the public interest because the Exchange is proposing to amend the default behavior of market DAY orders during the industry wide testing period for Members and other market participants to test with IEX as a primary listing exchange, and in advance of the first listing transferring to IEX, which will allow Members and other market participants time to develop, test, and deploy any necessary changes to support the handling of market DAY orders for participation in IEX Auctions.\32\ --------------------------------------------------------------------------- \32\ See supra note 28. --------------------------------------------------------------------------- Furthermore, as discussed in the purpose section, the process of making system changes to modify, test, and deploy the port setting configurations on a Member-by-Member basis adds additional technical complexities for Members and the Exchange. Thus, the Exchange believes the proposed rule changes are consistent with the protection of investors and the public interest in that the Exchange is proposing to simplify the process of entering market DAY orders, thereby reducing overall technical complexities within the System that raise risks to Exchange operations, Members, and their investor clients. Lastly, the Exchange believes that the proposed rule change would not result in unfair discrimination, since the proposed changes amend the default behavior of market DAY orders across all connectivity ports. Thus, all Members will be eligible to enter market DAY orders on a fair and equal basis. B. Self-Regulatory Organization's Statement on Burden on Competition IEX does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange believes that the proposed changes do not impact inter-market competition since it is merely designed [[Page 5658]] to simplify the entry of market DAY orders for all Members, without substantively changing the approved rules governing the behavior of such orders. Moreover, as noted above, no competing exchanges impose a similar requirement. In addition, the Exchange does not believe that the proposed changes will have any impact on intra-market competition, because as discussed in purpose section, the proposed changes amend the default behavior of market DAY orders across all connectivity ports. Thus, all Members will be eligible to enter market DAY orders on a fair and equal basis. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has designated this rule filing as non-controversial under Section 19(b)(3)(A) \33\ of the Act and Rule 19b-4(f)(6) \34\ thereunder. 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 and Rule 19b- 4(f)(6) thereunder. --------------------------------------------------------------------------- \33\ 15 U.S.C. 78s(b)(3)(A). \34\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- 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 under Section 19(b)(2)(B) \35\ of the Act to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \35\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: 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-IEX-2018-01 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-IEX-2018-01. This file number should be included in 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 Section, 100 F Street NE, Washington, DC 20549-1090. Copies of the filing will also be available for inspection and copying at the IEX's principal office and on its internet website at www.iextrading.com. 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-IEX- 2018-01 and should be submitted on or before March 1, 2018. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\36\ --------------------------------------------------------------------------- \36\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-02483 Filed 2-7-18; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 83, No. 27 / Thursday, February 8, 2018 / Notices 5655
the-counter quotation medium with respect to the proposed rule Amendment No. 3 thereto, be, and
immediately prior thereto. Such change that are filed with the hereby is, approved on an accelerated
regulatory halt will be terminated when Commission, and all written basis.
the DMM opens the security, and is for communications relating to the For the Commission, by the Division of
the limited purpose of precluding other proposed rule change between the Trading and Markets, pursuant to delegated
markets from trading a security until the Commission and any person, other than authority.69
Exchange has completed the initial those that may be withheld from the Brent J. Fields,
pricing process. The Commission public in accordance with the Secretary.
believes this proposed change also provisions of 5 U.S.C. 552, will be
[FR Doc. 2018–02501 Filed 2–7–18; 8:45 am]
should facilitate the initial opening by available for website viewing and
BILLING CODE 8011–01–P
the DMM of certain securities not listed printing in the Commission’s Public
in connection with an underwritten Reference Room, 100 F Street NE,
IPO, and thereby promote fair and Washington, DC 20549 on official SECURITIES AND EXCHANGE
orderly markets and the protection of business days between the hours of COMMISSION
investors.64 10:00 a.m. and 3:00 p.m. Copies of such
For the reasons set forth above, the filing also will be available for [Release No. 34–82623; File No. SR–IEX–
Commission finds that the proposed inspection and copying at the principal 2018–01]
rule change, as modified by Amendment office of the Exchange. All comments
No. 3, is consistent with the Exchange received will be posted without change. Self-Regulatory Organizations;
Act. Persons submitting comments are Investors Exchange LLC; Notice of
cautioned that we do not redact or edit Filing and Immediate Effectiveness of
V. Solicitation of Comments on personal identifying information from Proposed Rule Change To Modify the
Amendment No. 3 comment submissions. You should Default Handling of Market Orders
Interested persons are invited to submit only information that you wish Entered With a Time-in-Force of DAY
submit written data, views, and to make available publicly. All February 2, 2018.
arguments concerning whether submissions should refer to File Pursuant to Section 19(b)(1) 1 of the
Amendment No. 3 is consistent with the Number SR–NYSE–2017–30, and Securities Exchange Act of 1934 (the
Exchange Act. Comments may be should be submitted on or before March ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
submitted by any of the following 1, 2018. notice is hereby given that, on January
methods: 22, 2018, the Investors Exchange LLC
VI. Accelerated Approval of Proposed
Electronic Comments Rule Change, as Modified by (‘‘IEX’’ or the ‘‘Exchange’’) filed with the
Amendment No. 3 Securities and Exchange Commission
• Use the Commission’s internet (the ‘‘Commission’’) the proposed rule
comment form (http://www.sec.gov/ The Commission finds good cause to
change as described in Items I, II and III
rules/sro.shtml); or approve the proposed rule change, as
below, which Items have been prepared
• Send an email to rule-comments@ modified by Amendment No. 3, prior to
by the self-regulatory organization. The
sec.gov. Please include File Number SR– the thirtieth day after the date of
Commission is publishing this notice to
NYSE–2017–30 on the subject line. publication of the notice of Amendment
solicit comments on the proposed rule
No. 3 in the Federal Register. The
Paper Comments change from interested persons.
Commission notes that the proposed
• Send paper comments in triplicate rule change, as modified by Amendment I. Self-Regulatory Organization’s
to Brent J. Fields, Secretary, Securities No. 3 remains identical to the version Statement of the Terms of Substance of
and Exchange Commission, 100 F Street published for notice and comment on the Proposed Rule Change
NE, Washington, DC 20549–1090. August 24, 2017,65 except for the Pursuant to the provisions of Section
All submissions should refer to File proposed deletion described above,66 19(b)(1) under the Securities Exchange
Number SR–NYSE–2017–30. This file and that the only comments the Act of 1934 (‘‘Act’’),4 and Rule 19b–4
number should be included on the Commission received on this proposed thereunder,5 Investors Exchange LLC
subject line if email is used. To help the rule change were in support of the (‘‘IEX’’ or ‘‘Exchange’’) is filing with the
Commission process and review your proposal. The Commission also has Securities and Exchange Commission
comments more efficiently, please use found that the proposal, as modified by (‘‘Commission’’) a proposed rule change
only one method. The Commission will Amendment No. 3, is consistent with to modify the default handling of market
post all comments on the Commission’s the Exchange Act for the reasons orders 6 entered with a time-in-force of
internet website (http://www.sec.gov/ discussed herein. Accordingly, the DAY.7 The Exchange has designated
rules/sro.shtml). Copies of the Commission finds good cause for this rule change as ‘‘non-controversial’’
submission, all subsequent approving the proposed rule change, as under Section 19(b)(3)(A) of the Act 8
amendments, all written statements modified by Amendment No. 3, on an and provided the Commission with the
accelerated basis, pursuant to Section notice required by Rule 19b–4(f)(6)
64 The proposed regulatory halt allows the 19(b)(2) of the Exchange Act.67 thereunder.9 The text of the proposed
Exchange to have a similar opening procedure for
securities listed pursuant to Footnote (E) as an IPO VII. Conclusion
69 17 CFR 200.30–3(a)(12).
security under Section 12(f) of the Exchange Act
and Rule 12f–2, since such securities raise similar
It is Therefore Ordered, pursuant to 1 15 U.S.C. 78s(b)(1).
Section 19(b)(2) of the Exchange Act,68
daltland on DSKBBV9HB2PROD with NOTICES
issues in terms of initial pricing on the first day of 2 15 U.S.C. 78a.
trading. See 15 U.S.C. 78l(f); 17 CFR 240.12f–2. that the proposed rule change (SR– 3 17 CFR 240.19b–4.
Similar to unlisted trading privilege rules that NYSE–2017–30), as modified by 4 15 U.S.C. 78s(b)(1).
prevent other exchanges from trading an IPO 5 17 CRF 240.19b–4.
security until the primary listing market has 65 See
reported the first opening trade, the regulatory halt Notice, supra note 8. 6 See Rule 11.190(a)(2).
66 See note 11, supra. 7 See Rule 11.190(c)(3).
will allow the DMM to complete the initial pricing
67 15 U.S.C. 78s(b)(2). 8 15 U.S.C. 78s(b)(3)(A).
and open the security before other markets can
trade. 68 Id. 9 17 CFR 240.19b–4.
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![5658 Federal Register / Vol. 83, No. 27 / Thursday, February 8, 2018 / Notices
to simplify the entry of market DAY Comments may be submitted by any of SECURITIES AND EXCHANGE
orders for all Members, without the following methods: COMMISSION
substantively changing the approved
rules governing the behavior of such Electronic Comments
[Release No. 34–82631; File No. SR–NSCC–
orders. Moreover, as noted above, no • Use the Commission’s internet 2017–808]
competing exchanges impose a similar comment form (http://www.sec.gov/
requirement. rules/sro.shtml); or Self-Regulatory Organizations;
In addition, the Exchange does not National Securities Clearing
believe that the proposed changes will • Send an email to rule-comments@ Corporation; Notice of Filing of
have any impact on intra-market sec.gov. Please include File Number SR– Advance Notice, as Modified by
competition, because as discussed in IEX–2018–01 on the subject line. Amendment No. 1, To Enhance the
purpose section, the proposed changes Paper Comments Calculation of the Volatility Component
amend the default behavior of market of the Clearing Fund Formula That
DAY orders across all connectivity • Send paper comments in triplicate Utilizes a Parametric Value-at-Risk
ports. Thus, all Members will be eligible to Brent J. Fields, Secretary, Securities Model and Eliminate the Market Maker
to enter market DAY orders on a fair and and Exchange Commission, 100 F Street Domination Charge
equal basis. NE, Washington, DC 20549–1090.
February 5, 2018.
C. Self-Regulatory Organization’s All submissions should refer to File Pursuant to Section 806(e)(1) of Title
Statement on Comments on the Number SR–IEX–2018–01. This file VIII of the Dodd-Frank Wall Street
Proposed Rule Change Received From number should be included in the Reform and Consumer Protection Act
Members, Participants, or Others subject line if email is used. To help the entitled the Payment, Clearing, and
Written comments were neither Commission process and review your Settlement Supervision Act of 2010
solicited nor received. comments more efficiently, please use (‘‘Clearing Supervision Act’’) 1 and Rule
only one method. The Commission will 19b–4(n)(1)(i) under the Securities
III. Date of Effectiveness of the post all comments on the Commission’s
Proposed Rule Change and Timing for Exchange Act of 1934, as amended
internet website (http://www.sec.gov/ (‘‘Act’’),2 notice is hereby given that on
Commission Action
rules/sro.shtml). Copies of the December 28, 2017, National Securities
The Exchange has designated this rule submission, all subsequent Clearing Corporation (‘‘NSCC’’) filed
filing as non-controversial under amendments, all written statements with the Securities and Exchange
Section 19(b)(3)(A) 33 of the Act and with respect to the proposed rule Commission (‘‘Commission’’) the
Rule 19b–4(f)(6) 34 thereunder. Because change that are filed with the advance notice SR–NSCC–2017–808. On
the proposed rule change does not: (i) Commission, and all written January 10, 2018, NSCC filed
Significantly affect the protection of communications relating to the Amendment No. 1 to the advance
investors or the public interest; (ii) proposed rule change between the notice.3 The advance notice, as
impose any significant burden on Commission and any person, other than modified by Amendment No. 1
competition; and (iii) become operative those that may be withheld from the (hereinafter, the ‘‘Advance Notice’’) is
for 30 days from the date on which it public in accordance with the described in Items I, II and III below,
was filed, or such shorter time as the provisions of 5 U.S.C. 552, will be which Items have been prepared by the
Commission may designate, it has available for website viewing and clearing agency.4 The Commission is
become effective pursuant to Section printing in the Commission’s Public publishing this notice to solicit
19(b)(3)(A) of the Act and Rule 19b– Reference Section, 100 F Street NE, comments on the Advance Notice from
4(f)(6) thereunder. Washington, DC 20549–1090. Copies of interested persons.
At any time within 60 days of the the filing will also be available for
filing of the proposed rule change, the I. Clearing Agency’s Statement of the
inspection and copying at the IEX’s Terms of Substance of the Advance
Commission summarily may principal office and on its internet
temporarily suspend such rule change if Notice
website at www.iextrading.com. All
it appears to the Commission that such comments received will be posted The advance notice of NSCC consists
action is necessary or appropriate in the without change. Persons submitting of modifications to NSCC’s Rules &
public interest, for the protection of comments are cautioned that we do not
investors, or otherwise in furtherance of redact or edit personal identifying 1 12 U.S.C. 5465(e)(1).
the purposes of the Act. If the
information from comment submissions. 2 17 CFR 240.19b–4(n)(1)(i).
Commission takes such action, the 3 In Amendment No. 1 to the advance notice,
You should submit only information
Commission shall institute proceedings NSCC amended and replaced in its entirety the
that you wish to make available
under Section 19(b)(2)(B) 35 of the Act to originally filed confidential Exhibit 3a with a new
publicly. All submissions should refer confidential Exhibit 3a in order to remove
determine whether the proposed rule
to File Number SR–IEX–2018–01 and references to a practice that is not to be considered
change should be approved or as part of this filing.
should be submitted on or before March
disapproved. 4 On December 28, 2017, NSCC filed this Advance
1, 2018.
Notice as a proposed rule change (SR–NSCC–2017–
IV. Solicitation of Comments For the Commission, by the Division of 020) with the Commission pursuant to Section
Interested persons are invited to Trading and Markets, pursuant to delegated 19(b)(1) of the Act, 15 U.S.C. 78s(b)(1), and Rule
19b–4 thereunder, 17 CFR 240.19b–4. On January
submit written data, views and authority.36
daltland on DSKBBV9HB2PROD with NOTICES
10, 2018, NSCC filed Amendment No. 1 to the
arguments concerning the foregoing, Eduardo A. Aleman, proposed rule change to amend and replace in its
including whether the proposed rule Assistant Secretary.
entirety the originally filed confidential Exhibit 3a
change is consistent with the Act. with a new confidential Exhibit 3a in order to
[FR Doc. 2018–02483 Filed 2–7–18; 8:45 am] remove references to a practice that is not to be
BILLING CODE 8011–01–P
considered as part of this filing. A copy of the
33 15 U.S.C. 78s(b)(3)(A). proposed rule change, as modified by Amendment
34 17 CFR 240.19b–4(f)(6). No. 1, is available at http://www.dtcc.com/legal/
35 15 U.S.C. 78s(b)(2)(B). 36 17 CFR 200.30–3(a)(12). sec-rule-filings.
VerDate Sep<11>2014 17:18 Feb 07, 2018 Jkt 244001 PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 E:\FR\FM\08FEN1.SGM 08FEN1](https://thefederalregister.org/doc/83_FR_5682/page/4.svg)
Document Created: 2018-02-08 00:16:23
Document Modified: 2018-02-08 00:16:23
| 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 5655 |
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