[Federal Register Volume 76, Number 199 (Friday, October 14, 2011)]
[Notices]
[Pages 63977-63979]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-26529]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-65516; File No. SR-BATS-2011-040]
Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Extend
the Pilot Period of the Inbound Router, as Described in Rule 2.12
October 7, 2011.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on September 29, 2011, BATS Exchange, Inc. (the ``Exchange'' or
``BATS'') 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 Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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[[Page 63978]]
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange filed with the Commission a proposal to extend the
pilot program so that the Exchange can receive inbound routes of
equities orders through BATS Trading, Inc. (``BATS Trading''), the
Exchange's routing broker-dealer, from BATS Y-Exchange, Inc. (``BYX'').
The text of the proposed rule change is available at the Exchange's
Web site at http://www.batstrading.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 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 parts of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
Currently, BATS Trading is the approved outbound order routing
facility of BYX.\3\ The Exchange, through BATS Trading, has also been
authorized to receive inbound routes of equities orders by BATS Trading
from BYX.\4\ The Exchange's authority to receive inbound routes of
equities orders by BATS Trading from BYX is subject to a pilot period
of twelve months, ending October 15, 2011. The Exchange hereby seeks to
extend the previously approved pilot period (with the attendant
obligations and conditions) for an additional six months, through April
15, 2012. This is reflected in the proposed amendment to BATS Rule
2.12(b).
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\3\ See Securities Exchange Act Release No. 62716 (August 13,
2010), 75 FR 51295 (August 19, 2010) (Order Approving Application of
BATS Y-Exchange, Inc. for Registration as a National Securities
Exchange).
\4\ See Securities Exchange Act Release No. 62901 (September 13,
2010), 75 FR 57097 (September 17, 2010) (SR-BATS-2010-024) (Notice
of Filing and Immediate Effectiveness of Proposed Rule Change To
Adopt BATS Rule 2.12, Entitled ``BATS Trading, Inc. as Inbound
Router'' and To Make Related Changes) (the ``Inbound Router
Notice'').
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2. Statutory Basis
The Exchange believes that its proposal is consistent with the
requirements of the Act and the rules and regulations thereunder that
are applicable to a national securities exchange, and, in particular,
with the requirements of Section 6(b) of the Act.\5\ In particular, the
proposal is consistent with Section 6(b)(5) of the Act,\6\ because it
would promote just and equitable principles of trade, remove
impediments to, and perfect the mechanism of, a free and open market
and a national market system.
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\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(5).
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Specifically, the proposed rule change will allow the Exchange to
continue receiving inbound routes of equities orders from BATS Trading
acting in its capacity as a facility of BYX, in a manner consistent
with prior approvals and established protections. The Exchange believes
that extending the previously approved pilot period for six months will
permit both the Exchange and the Commission to further assess the
impact of the Exchange's authority to receive direct inbound routes of
equities orders via BATS Trading, including the attendant obligations
and conditions.\7\
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\7\ The Exchange plans to submit a proposal prior to the
expiration of the new pilot period to make permanent the Exchange's
authority to receive direct inbound routes of equities orders via
BATS Trading.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change imposes
any burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
The Exchange has neither solicited nor received written comments on
the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not significantly
affect the protection of investors or the public interest, does not
impose any significant burden on competition, and, by its terms, does
not 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 \8\ and Rule 19b-
4(f)(6) thereunder.\9\
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\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's intent to file the proposed rule change, along with a
brief description and 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. The
Exchange has satisfied this requirement.
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The Exchange has requested that the Commission waive the 30-day
operative delay. The Exchange believes that the proposed rule change is
consistent with the protection of investors and the public interest
because it would permit the Exchange to continue receiving inbound
routes of equities orders from BATS Trading, in a manner consistent
with prior approvals and established protections.\10\ The Commission
believes that waiver of the operative delay is consistent with the
protection of investors and the public interest because such waiver
would allow the pilot period to be extended without undue delay through
April 15, 2011 while the Exchange's proposal to make the pilot
permanent is under consideration.\11\ Therefore, the Commission
designates the proposal operative upon filing.\12\
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\10\ See SR-BATS-2011-040, Item 7.
\11\ See supra note 7.
\12\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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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.
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 e-mail to [email protected]. Please include
File Number SR-BATS-2011-040 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary,
[[Page 63979]]
Securities and Exchange Commission, 100 F Street, NE., Washington, DC
20549-1090.
All submissions should refer to File Number SR-BATS-2011-040. This file
number should be included on the subject line if e-mail 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
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-BATS-2011-040 and should be
submitted on or before November 4, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-26529 Filed 10-13-11; 8:45 am]
BILLING CODE 8011-01-P