[Federal Register Volume 78, Number 184 (Monday, September 23, 2013)]
[Notices]
[Pages 58362-58364]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-23009]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-70428; File No. SR-CTA-2013-05]
Consolidated Tape Association; Notice of Filing of the Eighteenth
Substantive Amendment to the Second Restatement of the CTA Plan
September 17, 2013.
Pursuant to Section 11A of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 608 thereunder,\2\ notice is hereby given that
on September 9, 2013, the Consolidated Tape Association (``CTA'') Plan
participants (``Participants'') \3\ filed with
[[Page 58363]]
the Securities and Exchange Commission (``Commission'') a proposal to
amend the Second Restatement of the CTA Plan (the ``CTA Plan'').\4\ The
amendment proposes to remove odd-lot transactions from the list of
transactions that are not to be reported for inclusion on the
consolidated tape. The Commission is publishing this notice to solicit
comments from interested persons on the proposed amendment.
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\1\ 15 U.S.C. 78k-1.
\2\ 17 CFR 242.608.
\3\ Each participant executed the proposed amendment. The
Participants are: BATS Exchange, Inc., BATS-Y Exchange, Inc.,
Chicago Board Options Exchange, Incorporated, Chicago Stock
Exchange, Inc., EDGA Exchange, Inc. (``EDGA''), EDGX Exchange, Inc.
(``EDGX''), Financial Industry Regulatory Authority, Inc.
(``FINRA''), International Securities Exchange, LLC, NASDAQ OMX BX,
Inc. (``Nasdaq BX''), NASDAQ OMX PHLX, Inc. (``Nasdaq PSX''), Nasdaq
Stock Market LLC, National Stock Exchange, New York Stock Exchange
LLC (``NYSE''), NYSE MKT LLC (formerly NYSE Amex, Inc.), and NYSE
Arca, Inc. (``NYSE Arca'').
\4\ See Securities Exchange Act Release No. 10787 (May 10,
1974), 39 FR 17799 (declaring the CTA Plan effective). The CTA Plan,
pursuant to which markets collect and disseminate last sale price
information for non-NASDAQ listed securities, is a ``transaction
reporting plan'' under Rule 601 under the Act, 17 CFR 242.601, and a
``national market system plan'' under Rule 608 under the Act, 17 CFR
242.608.
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I. Rule 608(a)
A. Purpose of the Amendments
Currently, Section VIII(a) (Responsibility of Exchange
Participants) of the CTA Plan provides that each Participant will
``collect and report to the Processor all last sale price information
to be reported by it relating to transactions in Eligible Securities
taking place on its floor.'' However, Section VI(d) (Transactions not
reported (related messages)) provides a list of transactions that ``are
not to be reported for inclusion on the consolidated tape.'' That list
includes odd-lot transactions.
Because odd-lot transactions account for a not insignificant
percentage of trading volume, the Participants have determined that
including odd-lot transactions on the consolidated tape of CTA last
sale prices would add post-trade transparency to the marketplace.
This amendment proposes to add odd-lot transactions to the
consolidated tape by removing them from Section VI(d)'s list of
transactions that are not to be reported for inclusion on the
consolidated tape.
Due to the lack of economic significance of many individual odd-lot
orders, the Participants are not proposing to include bids and offers
for odd-lots in the best bid and best offer calculations that the
Participants make available under the CQ Plan.
For the same reason, the Participants do not propose to include
odd-lot transactions in calculations of last sale prices. Therefore,
odd-lot transactions would not be included in calculations of high and
low prices and would not be subject to Limit Up/Limit Down rules.
Similarly, including odd-lot transactions on the consolidated tape
would not trigger short sale restrictions or trading halts. However,
odd-lot transactions would be included in calculations of daily
consolidated volume.
For purposes of allocating revenue among the Participants under the
CTA Plan, the Participants would include odd-lot transactions in the
Security Income Allocation for each Eligible Security under Section
XII(a)(ii) (Security Income Allocation) of the CTA plan. Just as with
round lot transactions, an odd-lot transaction with a dollar value of
$5000 or more would constitute one qualified transaction report and an
odd-lot transaction with a dollar value of less than $5000 would
constitute a fraction of a qualified transaction report that equals the
dollar value of the transaction report divided by $5000. The
Participants do not anticipate that this will produce a significant
shift in revenue allocation among the Participants. This treatment of
odd-lot transactions for revenue allocation purposes does not require a
change to the language of the CTA Plan.
B. Additional Information Required by Rule 608(a)
1. Governing or Constituent Documents
Not applicable.
2. Implementation of the Amendment
All of the Participants have manifested their approval of the
proposed amendment by means of their execution of the amendments.
Subject to Commission approval of the Amendment, the Participants
intend to add odd-lot transactions to the consolidated tape under the
CTA Plan commencing October 21, 2013.
3. Development and Implementation Phases
Not applicable.
4. Analysis of Impact on Competition
The proposed amendment does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Exchange Act. This change is being proposed and implemented in
parallel with similar changes to the national market system plan
governing the trading of stocks listed on NYSE, Amex, and other markets
(i.e., the Nasdaq/UTP plan). The Participants do not believe that the
proposed plan amendment introduces terms that are unreasonably
discriminatory for the purposes of Section 11A(c)(1)(D) of the Act.\5\
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\5\ 15 U.S.C. 78k-1(c)(1)(D).
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5. Written Understanding or Agreements Relating to Interpretation of,
or Participation in, Plan
Not applicable.
6. Approval by Sponsors in Accordance With Plan
Under Section IV(b) of the CTA Plan, each Participant must execute
a written amendment to the CTA Plan before the amendment can become
effective. The amendment is so executed.
7. Description of Operation of Facility Contemplated by the Proposed
Amendment
Not applicable.
8. Terms and Conditions of Access
Not applicable.
9. Method of Determination and Imposition, and Amount of, Fees and
Charges
Not applicable.
10. Method of Frequency of Processor Evaluation
Not applicable.
11. Dispute Resolution
Not applicable.
II. Rule 601(a)
A. Equity Securities for Which Transaction Reports Shall be Required by
the Plan
Not applicable.
B. Reporting Requirements
As a result of the amendment, each Participant would be required to
report odd-lot transactions to the Nasdaq/UTP Plan's Processor for
inclusion in the consolidated tape.
C. Manner of Collecting, Processing, Sequencing, Making Available and
Disseminating Last Sale Information
Not applicable.
D. Manner of Consolidation
Odd-lot transactions would not be eligible for inclusion in
calculations of last sale prices and would not be included in
calculations of high and low prices. However, odd-lot transactions
would be included in calculations of daily consolidated volume.
E. Standards and Methods Ensuring Promptness, Accuracy and Completeness
of Transaction Reports
Not applicable.
F. Rules and Procedures Addressed to Fraudulent or Manipulative
Dissemination
Not applicable.
[[Page 58364]]
G. Terms of Access to Transaction Reports
Not applicable.
H. Identification of Marketplace of Execution
Not applicable.
III. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed
amendments are 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-CTA-2013-05 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-CTA-2013-05. 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 Amendments that are filed with
the Commission, and all written communications relating to the
Amendments between the Commission and any person, other than those that
may be withheld from the public in accordance with the provisions of 5
U.S.C. 552, will be available for Web site viewing and printing in the
Commission's Public Reference Room, 100 F Street NE., Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the Amendments also will be available for
inspection and copying at the principal office of the CTA.
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-CTA-2013-05
and should be submitted on or before October 15, 2013.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\6\
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\6\ 17 CFR 200.30-3(a)(27).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-23009 Filed 9-20-13; 8:45 am]
BILLING CODE 8011-01-P