[Federal Register Volume 78, Number 126 (Monday, July 1, 2013)]
[Notices]
[Pages 39365-39367]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-15622]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-69846; File No. SR-BOX-2013-33]
Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change to
Amend Interpretive Material to Rule 7150 (Price Improvement Period
``PIP'') to Extend a Pilot Program that Permits the Exchange to Have no
Minimum Size Requirement for Orders Entered into the PIP (``PIP Pilot
Program'')
June 25, 2013.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
[[Page 39366]]
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on June 21, 2013, BOX Options Exchange LLC (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 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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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Interpretive Material to Rule 7150
(Price Improvement Period ``PIP'') to extend a pilot program that
permits the Exchange to have no minimum size requirement for orders
entered into the PIP (``PIP Pilot Program''). The text of the proposed
rule change is available from the principal office of the Exchange, at
the Commission's Public Reference Room and also on the Exchange's
Internet Web site at http://boxexchange.com.
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 these statements 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
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of the proposed rule change is to extend the PIP Pilot
Program for twelve additional months. The PIP Pilot Program allows the
Exchange to have no minimum size requirement for orders entered into
the PIP.\3\ The Exchange has committed to provide certain data to the
Commission during the PIP Pilot Program.\4\ The proposed rule change
retains the text of IM-7150-1 to Rule 7150 and seeks to extend the
operation of the PIP Pilot Program until July 18, 2014.
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\3\ The Pilot Program is currently set to expire on July 18,
2013. See Securities Exchange Act Release Nos. 66871 (April 27,
2012) 77 FR 26323 (May 3, 2012) (File No.10-206, In the Matter of
the Application of BOX Options Exchange LLC for Registration as a
National Securities Exchange Findings, Opinion, and Order of the
Commission) and 67255 (June 26, 2012) 77 FR 39315 (July 2, 2013)
(SR-BOX-2012-009) (Notice of Filing and Immediate Effectiveness of a
Proposal To Extend a Pilot Program That Permits BOX to Have No
Minimum Size Requirement for Orders Entered Into the Price
Improvement Period).
\4\ Id. at 26334.
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The Exchange notes that the PIP Pilot Program guarantees
Participants the right to trade with their customer orders that are
less than 50 contracts. In particular, any order entered into the PIP
is guaranteed an execution at the end of the auction at a price at
least equal to the national best bid or offer. In further support of
this proposed rule change, the Exchange will submit to the Commission
monthly a PIP Pilot Program Report, offering detailed data from, and
analysis of, the PIP Pilot Program. Specifically, the Exchange believes
that, by extending the expiration of the PIP Pilot Program, the
proposed rule change will allow for further analysis of the PIP Pilot
Program and a determination of how the PIP Pilot Program shall be
structured in the future.
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act,\5\ in general, and Section
6(b)(5) of the Act,\6\ in particular, in that it is designed to foster
cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, to remove impediments to and
perfect the mechanism for a free and open market and a national market
system and, in general, to protect investors and the public interest.
The Exchange believes that the data demonstrates that there is
sufficient investor interest and demand to extend the PIP Pilot Program
for an additional twelve months. The Exchange represents that the Pilot
Program is designed to provide investors with real and significant
price improvement regardless of the size of the order.
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\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. Specifically, the Exchange
believes that, by extending the expiration of the PIP Pilot Program,
the proposed rule change will allow for further analysis of the PIP
Pilot Program and a determination of how the PIP Pilot Program shall be
structured in the future. In doing so, the proposed rule change will
also serve to promote regulatory clarity and consistency, thereby
reducing burdens on the marketplace and facilitating investor
protection.
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 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: (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)(ii) of the Act \7\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\8\
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\7\ 15 U.S.C. 78s(b)(3)(A)(ii).
\8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
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
Commission deems this requirement to have been met.
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A proposed rule change filed under Rule 19b-4(f)(6) \9\ normally
does not become operative for 30 days after the date of filing.
However, pursuant to Rule 19b-4(f)(6)(iii) \10\ the Commission may
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange requested
that the Commission waive the 30-day operative delay. The Exchange
noted that such waiver will permit the PIP Pilot Program to continue
without interruption.
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\9\ 17 CFR 240.19b-4(f)(6).
\10\ 17 CFR 240.19b-4(f)(6)(iii).
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The Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest, as
it will allow the pilot program to continue uninterrupted, thereby
avoiding any potential investor confusion that could result from a
temporary interruption in the pilot program. Further, the
[[Page 39367]]
Commission notes that, because the filing was submitted for immediate
effectiveness on June 21, 2013, the fact that the current rule
provision does not expire until July 18, 2013 will afford interested
parties the opportunity to comment on the proposal before the Exchange
requires it to become operative. For this reason, the Commission
designates the proposed rule change to be operative on July 18,
2013.\11\
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\11\ For purposes only of waiving the 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 email to [email protected]. Please include
File Number SR-BOX-2013-33 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-BOX-2013-33. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, on official
business days between the hours of 10:00 a.m. and 3:00 p.m., located at
100 F Street NE., Washington, DC 20549. Copies of such 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-BOX-
2013-33 and should be submitted on or before July 22, 2013.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary .
[FR Doc. 2013-15622 Filed 6-28-13; 8:45 am]
BILLING CODE 8011-01-P