[Federal Register Volume 80, Number 162 (Friday, August 21, 2015)]
[Notices]
[Pages 50896-50898]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-20655]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-75713; File No. SR-EDGX-2015-36]
Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change to Amend
Rule 13.8 To Describe the Market Data Product EDGX Book Viewer
August 17, 2015.
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 August 7, 2015, EDGX Exchange, Inc. (the ``Exchange'' or
``EDGX'') 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 Exchange
has designated this proposal as a ``non-controversial'' proposed rule
change pursuant to section 19(b)(3)(A) of the Act \3\ and Rule 19b-
4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with
the Commission. 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.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(6)(iii).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange filed a proposal to amend Rule 13.8 to describe a
market data product known as EDGX Book Viewer.
The text of the proposed rule change is available at the Exchange's
Web site at 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
The Exchange proposes to add language to Rule 13.8 describing a
market data product known as EDGX Book Viewer. The proposal
memorializes in the Exchange's rules a data feed that is currently
available through the Exchange's public Web site free of charge. EDGX
Book Viewer is a data feed that disseminates, on a real-time basis, the
aggregated two-side quotations for up to five (5) price levels for all
displayed orders for securities traded on the Exchange and for which
the Exchanges reports quotes under the Consolidated Tape Association
(``CTA'') Plan or the Nasdaq/UTP Plan. EDGX Book Viewer also contains
the last ten (10) trades including time of trade, price and share
quantity. Book Viewer is currently available via www.batstrading.com
without charge. The Exchange will file a separate proposed rule change
with the Commission proposing fees to be charged for certain types of
access to EDGX Book Viewer as of September 1, 2015.\5\
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\5\ The Exchange understands that its affiliated exchanges
intend to file identical proposed rule changes to adopt rules and
fees for the Book Viewer data feed with the Commission. The
Exchange's affiliates are EDGA Exchange, Inc., BATS Exchange, Inc.
and BATS Y-Exchange, Inc.
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with
[[Page 50897]]
section 6(b) of the Act,\6\ in general, and furthers the objectives of
section 6(b)(5) of the Act,\7\ 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 to protect investors and the public interest, and that it is not
designed to permit unfair discrimination among customers, brokers, or
dealers. This proposal is in keeping with those principles in that it
promotes increased transparency through the dissemination of EDGX Book
Viewer. The Exchange also believes this proposal is consistent with
section 6(b)(5) of the Act because it protects investors and the public
interest and promotes just and equitable principles of trade by
providing investors with an alternative for receiving market data as
requested by market data vendors and purchasers that expressed an
interest in exchange-only data for instances where consolidated data is
no longer required to be purchased and displayed. The proposed rule
change would benefit investors by facilitating their prompt access to
real-time depth-of-book information contained in EDGX Book Viewer. The
proposed rule change also removes impediments to and perfect the
mechanism of a free and open market and a national market system by
memorializing in the Exchange's rules a data feed that is currently
available through the Exchange's public Web site free of charge.
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\6\ 15 U.S.C. 78f.
\7\ 15 U.S.C. 78f(b)(5).
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The Exchange also believes that the proposed rule change is
consistent with section 11(A) of the Act \8\ in that it supports (i)
fair competition among brokers and dealers, among exchange markets, and
between exchange markets and markets other than exchange markets and
(ii) the availability to brokers, dealers, and investors of information
with respect to quotations for and transactions in securities.
Furthermore, the proposed rule change is consistent with Rule 603 of
Regulation NMS,\9\ which provides that any national securities exchange
that distributes information with respect to quotations for or
transactions in an NMS stock do so on terms that are not unreasonably
discriminatory. EDGX Book Viewer is accessed and subscribed to on a
voluntary basis, in that neither the Exchange nor market data
distributors are required by any rule or regulation to make this data
available. Accordingly, distributors and subscribers can discontinue
use at any time and for any reason.
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\8\ 15 U.S.C. 78k-1.
\9\ See 17 CFR 242.603.
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In adopting Regulation NMS, the Commission granted self-regulatory
organizations and broker-dealers increased authority and flexibility to
offer new and unique market data to consumers of such data. It was
believed that this authority would expand the amount of data available
to users and consumers of such data and also spur innovation and
competition for the provision of market data. The Exchange believes
that the data products proposed herein are precisely the sort of market
data products that the Commission envisioned when it adopted Regulation
NMS. The Commission concluded that Regulation NMS--by lessening
regulation of the market in proprietary data--would itself further the
Act's goals of facilitating efficiency and competition:
[E]fficiency is promoted when broker-dealers who do not need the
data beyond the prices, sizes, market center identifications of the
NBBO and consolidated last sale information are not required to
receive (and pay for) such data. The Commission also believes that
efficiency is promoted when broker-dealers may choose to receive
(and pay for) additional market data based on their own internal
analysis of the need for such data.\10\
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\10\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496 (June 29, 2005) (File No. S7-10-04).
By removing ``unnecessary regulatory restrictions'' on the ability
of exchanges to sell their own data, Regulation NMS advanced the goals
of the Act and the principles reflected in its legislative history.
In addition, EDGX Book Viewer removes impediments to and perfects
the mechanism of a free and open market and a national market system
because EDGX Book Viewer provides investors with alternative market
data and competes with similar market data product currently offered by
the New York Stock Exchange, Inc. (``NYSE'') and the Nasdaq Stock
Market LLC (``Nasdaq'').\11\ The provision of new options for investors
to receive market data was a primary goal of the market data amendments
adopted by Regulation NMS.\12\ EDGX Book Viewer is precisely the sort
of market data product that the Commission envisioned when it adopted
Regulation NMS.
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\11\ See Nasdaq Rule 7023(a)(1)(C) (describing Nasdaq TotalView
is a depth-of-book data feed that includes all orders and quotes
from all Nasdaq members displayed in the Nasdaq Market Center as
well as the aggregate size of such orders and quotes at each price
level in the execution functionality of the Nasdaq Market Center).
See also Nasdaq Book Viewer, a description of which is available at
https://data.nasdaq.com/Book Viewer.aspx (last visited July 29,
2015). See NYSE OpenBook available at http://www.nyxdata.com/openbook (last visited July 29, 2015) (providing real-time view of
the NYSE limit order book). See e.g., Securities Exchange Act
Release No. 71775 (March 24, 2014), 79 FR 17627 (March 28, 2014)
(SR-CBOE-2014-021) (Notice of Filing and Immediate Effectiveness of
Proposed Rule Change Related to the CBSX BBO Data Feed and the New
CBSX Book Depth Data Feed).
\12\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, at 37503 (June 29, 2005) (Regulation NMS
Adopting Release).
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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
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The proposal is
not intended to address any competitive issues, but rather to
memorialize in the Exchange's rules a data feed that is currently
available through the Exchange's public Web site free of charge.
Nonetheless, the Exchange believes that the proposal will promote
competition by the Exchange offering a service similar to that offered
by the NYSE and Nasdaq.\13\ Thus, the Exchange believes this proposed
rule change is necessary to permit fair competition among national
securities exchanges. Therefore, the Exchange does not believe 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.
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\13\ See supra note 11.
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(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
The Exchange has designated this rule filing as non-controversial
under section 19(b)(3)(A) of the Act \14\ and paragraph (f)(6) of Rule
19b-4 thereunder.\15\ The proposed rule change effects a change that:
(A) Does not significantly affect the protection of investors or the
public interest; (B) does not impose any significant burden on
competition; and (C) by its terms, does not become operative for 30
days after the date of the filing, or such shorter time as the
[[Page 50898]]
Commission may designate if consistent with the protection of investors
and the public interest; provided that the self-regulatory organization
has given the Commission written notice of its 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.\16\
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4.
\16\ The Exchange has fulfilled this requirement.
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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: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposal 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 No. SR-EDGX-2015-36 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 No. SR-EDGX-2015-36. 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, 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 such filing will also 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 No. SR- EDGX-2015-36 and should be
submitted on or before September 11, 2015.
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\17\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-20655 Filed 8-20-15; 8:45 am]
BILLING CODE 8011-01-P