[Federal Register Volume 79, Number 159 (Monday, August 18, 2014)]
[Notices]
[Pages 48783-48785]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-19473]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-72815; File No. SR-NYSEMKT-2014-65]
Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and
Immediate Effectiveness of Proposed Rule Change Amending Rule 935NY and
Rule 964NY To Delete Obsolete References to Tracking Orders and Make
Other Non-Substantive, Technical Changes to the Exchange Rules
August 12, 2014.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that, on July 31, 2014, NYSE MKT LLC (``Exchange'' or ``NYSE MKT'')
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.
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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 Rule 935NY (Order Exposure
Requirements) and Rule 964NY (Display, Priority and Order Allocation--
Trading Systems) to delete obsolete references to Tracking Orders and
make other non-substantive, technical changes to the Exchange rules.
The text of the proposed rule change is available on the Exchange's Web
site 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, of the most
significant parts of such statements.
[[Page 48784]]
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange recently filed and received approval of a rule change
amending rules governing Exchange order types, which included the
deletion of Tracking Orders, an order type which had been deemed
obsolete due to a lack of demand by market participants.\3\ When the
Exchange eliminated Tracking Orders, references to Tracking Orders were
inadvertently left in Rule 935NY and Rule 964NY. This filing is
intended to correct that oversight by deleting the references to
Tracking Orders that are no longer relevant.
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\3\ See Securities and Exchange Release 71630 (February 27,
2014), 79 FR 12553 (March 5, 2014) (SR-NYSEMKT-2014-05).
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First, the Exchange is proposing to delete Commentary .05 to Rule
935NY to eliminate reference to Tracking Orders, which as noted are no
longer valid for use on the Exchange, and to designate Commentary .05
as Reserved.
Similarly, the Exchange is proposing to delete section (F) from
Rule 964NY(b)(2) to delete reference to Tracking Orders. In addition,
the Exchange proposes to amend Rule 964NY(c)(2)(E) by combining
subsections (ii) and (iii), in doing so the Exchange would eliminate
reference to Tracking Orders and would update the subsequent rule text
in that section to accurately describe the functionality now that
Tracking Orders are no longer valid. In light of the foregoing change,
the Exchange believes it is also appropriate to amend the paragraph
following former subsection Rule 964NY(c)(2)(E)(iii) by deleting the
clause bracketed below, as the Exchange believes that it is rendered
superfluous by the proposed change:
If [neither of the conditions specified in subsections (i) or
(ii) apply, and] the order is no longer marketable, or, if an order
has been designated as an order type that is not eligible to be
routed away, the order either will be placed in the Consolidated
Book or cancelled if such order would lock or cross the NBBO.
The Exchange believes the proposed deletion of this clause is
appropriate because the order is either going to be executed at the
next available price (Rule 964NY(c)(2)(E)(i)) or, if it locks or
crosses the NBBO, the Exchange will route it out (proposed Rule
964NY(c)(2)(E)(ii), which incorporates language from current subsection
(iii). Finally, the Exchange also proposes to delete the reference to
Tracking Orders as contained in Rule 964NY(c)(3)(C) because it is an
obsolete reference.
The above mentioned rule changes are non-substantive and technical
in nature and simply designed to remove references to an obsolete order
type.
Separately, the Exchange is also proposing to update an obsolete
reference in Rule 964NY(d) (Prohibited Conduct Relating to Crossing
Orders). In 2009, the Exchange filed and received approval of a rule
change that reduced the exposure time during which Amex Users may not
execute as principal against orders they represent as agent from three
seconds to one second as found in Rule 935NY.\4\ However, Rule
964NY(d)(1), which references the exposure time, was never adjusted to
reflect the change. The Exchange now proposes to remove the outdated
reference to the three-second exposure requirement found in Rule
964NY(d)(1). The Exchange also proposes to add a reference to Rule
935NY, in lieu of including the actual exposure time in Rule
964NY(d)(1). The Exchange believes changing the rule text in Rule
964NY(d)(1) to reference to Rule 935NY would ensure consistency and
transparency in Exchange rules, as any future changes to Rule 935NY
would automatically be taken into account by Rule 964NY(d)(1), and
would reduce any confusion among market participants.
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\4\ See Securities and Exchange Release No. 59956 (May 21,
2009), 74 FR 25782, (May 29, 2009) (NYSEAmex-2009-15).
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2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
Section 6(b) \5\ of the Securities Exchange Act of 1934 (the ``Act''),
in general, and furthers the objectives of Section 6(b)(5),\6\ in
particular, in that it is designed to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in facilitating transactions in securities, and to
remove impediments to and perfect the mechanism of a free and open
market and a national market system. Specifically, the Exchange
believes that the proposed rule change will remove impediments to and
perfect the mechanisms of a free and open market and add transparency
and clarity to the Exchange's rules. The Exchange further believes that
eliminating references to an obsolete order type and updating an
outmoded reference promotes just and equitable principles of trade,
fosters cooperation and coordination among persons engaged in
facilitating securities transactions, and removes impediments to and
perfects the mechanism of a free and open market by ensuring that
members, regulators and the public can more easily navigate the
Exchange's rulebook and better understand the order types available for
trading on the Exchange.
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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 that is not necessary or appropriate
in furtherance of the purposes of the Act. The proposed change is not
designed to address any competitive issue but rather to revise obsolete
or inaccurate rule text and to remove language pertaining to
unavailable functionality in the Exchange's rulebook, thereby reducing
confusion and making the Exchange's rules easier to understand and
navigate. The Exchange believes that the proposed rule change will
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
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
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \7\ and Rule 19b-4(f)(6) thereunder.\8\
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 prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
[[Page 48785]]
of the Act and Rule 19b-4(f)(6)(iii) thereunder.
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\7\ 15 U.S.C. 78s(b)(3)(A)(iii).
\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
Exchange has satisfied this requirement.
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At any time within 60 days of the filing of such 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) \9\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\9\ 15 U.S.C. 78s(b)(2)(B).
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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-NYSEMKT-2014-65 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-NYSEMKT-2014-65. 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 Section, 100 F Street
NE., Washington, DC 20549-1090. Copies of the filing will also be
available for Web site viewing and printing at the NYSE's principal
office and on its Internet Web site at www.nyse.com. 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-NYSEMKT-2014-65 and should
be submitted on or before September 8, 2014.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-19473 Filed 8-15-14; 8:45 am]
BILLING CODE 8011-01-P