Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Modifying Certain Proprietary Options Data Products, 60201-60204 [2015-25184]

Download as PDF Federal Register / Vol. 80, No. 192 / Monday, October 5, 2015 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–76020; File Nos. SR–NYSE– 2011–55; SR–NYSEAmex–2011–84] Self-Regulatory Organizations; New York Stock Exchange LLC; NYSE MKT LLC; Order Granting an Extension to Limited Exemptions From Rule 612(c) of Regulation NMS in Connection With the Exchanges’ Retail Liquidity Programs Until March 31, 2016 September 29, 2015. On July 3, 2012, the Securities and Exchange Commission (‘‘Commission’’) issued an order pursuant to its authority under Rule 612(c) of Regulation NMS (‘‘Sub-Penny Rule’’) 1 that granted the New York Stock Exchange LLC (‘‘NYSE’’) and NYSE MKT LLC 2 (‘‘NYSE MKT’’ and, together with NYSE, the ‘‘Exchanges’’) limited exemptions from the Sub-Penny Rule in connection with the operation of the Exchanges’ respective Retail Liquidity Programs (‘‘Programs’’).3 The limited exemptions were granted concurrently with the Commission’s approval of the Exchanges’ proposals to adopt their respective Programs for one-year pilot terms.4 The exemptions were granted coterminous with the effectiveness of the pilot Programs; both the pilot Programs and exemptions are scheduled to expire on September 30, 2015.5 1 17 CFR 242.612(c). the time it filed the original proposal to adopt the Retail Liquidity Program, NYSE MKT went by the name NYSE Amex LLC. On May 14, 2012, the Exchange filed a proposed rule change, immediately effective upon filing, to change its name from NYSE Amex LLC to NYSE MKT LLC. See Securities Exchange Act Release No. 67037 (May 21, 2012), 77 FR 31415 (May 25, 2012) (SR– NYSEAmex–2012–32). 3 See Securities Exchange Act Release No. 67347 (July 3, 2012), 77 FR 40673 (July 10, 2012) (SR– NYSE–2011–55; SR–NYSEAmex–2011–84) (‘‘Order’’). 4 See id. 5 The pilot terms of the Programs were originally scheduled to end on July 31, 2013, but the Exchanges initially extended the terms for an additional year, through July 31, 2014, see Securities Exchange Act Release Nos. 70096 (August 2, 2013), 78 FR 48520 (August 8, 2013) (SR–NYSE–2013–48), and 70100 (August 2, 2013), 78 FR 48535 (August 8, 2013) (SR–NYSEMKT– 2013–60), and then subsequently extended the terms again through March 31, 2015, see Securities Exchange Act Release Nos. 72629 (July 16, 2014), 79 FR 42564 (July 22, 2014) (SR–NYSE–2014–35), and 72625 (July 16, 2014), 79 FR 42566 (July 22, 2014) (SR–NYSEMKT–2014–60), and September 30, 2015, see Securities Exchange Act Release Nos. 74454 (March 6, 2015), 80 FR 13054 (March 12, 2015) (SR–NYSE–2015–10), and 74455 (March 6, 2015), 80 FR 13047 (March 12, 2015) (SR– NYSEMKT–2015–14). Each time the pilot terms of the Programs were extended, the Commission granted the Exchanges’ requests to also extend the Sub-Penny exemptions through July 31, 2014, see Securities Exchange Act Release No. 70085 (July 31, 2013), 78 FR 47807 (August 6, 2013), March 31, mstockstill on DSK4VPTVN1PROD with NOTICES 2 At VerDate Sep<11>2014 18:34 Oct 02, 2015 Jkt 238001 The Exchanges now seek to extend the exemptions until March 31, 2016.6 The Exchanges’ request was made in conjunction with immediately effective filings that extend the operation of the Programs through the same date.7 In their request to extend the exemptions, the Exchanges note that the participation in the Programs has increased more recently. Accordingly, the Exchanges have asked for additional time to allow themselves and the Commission to analyze more robust data concerning the Programs, which the Exchanges committed to provide to the Commission.8 For this reason and the reasons stated in the Order originally granting the limited exemptions, the Commission finds that extending the exemptions, pursuant to its authority under Rule 612(c) of Regulation NMS, is appropriate in the public interest and consistent with the protection of investors. Therefore, it is hereby ordered that, pursuant to Rule 612(c) of Regulation NMS, each Exchange is granted a limited exemption from Rule 612 of Regulation NMS that allows it to accept and rank orders priced equal to or greater than $1.00 per share in increments of $0.001, in connection with the operation of its Retail Liquidity Program, until March 31, 2016. The limited and temporary exemptions extended by this Order are subject to modification or revocation if at any time the Commission determines that such action is necessary or appropriate in furtherance of the purposes of the Securities Exchange Act of 1934. Responsibility for compliance with any applicable provisions of the Federal securities laws must rest with the persons relying on the exemptions that are the subject of this Order. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.9 Robert W. Errett, Deputy Secretary. [FR Doc. 2015–25182 Filed 10–2–15; 8:45 am] BILLING CODE 8011–01–P 2015, see Securities Exchange Act Release No. 72732 (July 31, 2014), 79 FR 45851 (August 6, 2014), and September 30, 2015, see Securities Exchange Act Release No. 74507 (March 13, 2015), 80 FR 14421 (March 19, 2015), respectively. 6 See Letter from Martha Redding, Assistant Secretary, NYSE, to Brent J. Fields, Secretary, Securities and Exchange Commission, dated September 17, 2015. 7 See Securities Exchange Act Release Nos. 75993 (September 28, 2015),—FR—(SR–NYSE–2015–41), and 75995 (September 28, 2015),—FR—(SR– NYSEMKT–2015–69). 8 See Order, supra note 3, 77 FR at 40681. 9 17 CFR 200.30–3(a)(83). PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 60201 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–76022; File No. SR– NYSEMKT–2015–68] Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Modifying Certain Proprietary Options Data Products September 29, 2015. 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 September 18, 2015, NYSE MKT LLC (the ‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III 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. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to modify certain proprietary options data products. 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. A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to modify certain proprietary options data products. 1 15 2 17 E:\FR\FM\05OCN1.SGM U.S.C. 78s(b)(1). CFR 240.19b–4. 05OCN1 60202 Federal Register / Vol. 80, No. 192 / Monday, October 5, 2015 / Notices mstockstill on DSK4VPTVN1PROD with NOTICES The Exchange currently offers the following real-time options market data feeds through its ArcaBook for Amex Options data product (collectively, ‘‘Current Options Products’’): 3 • ‘‘ArcaBook for Amex Options— Trades’’ makes available NYSE Amex Options last sale information on a realtime basis as it is reported to the Options Price Reporting Authority (‘‘OPRA’’) and disseminated on a consolidated basis under the OPRA Plan.4 • ‘‘ArcaBook for Amex Options—Top of Book’’ makes available NYSE Amex Options best bids and offers (‘‘BBO’’) (including orders and quotes) on a realtime basis as reported to OPRA and disseminated on a consolidated basis under the OPRA Plan. • ‘‘ArcaBook for Amex Options— Series Status’’ makes available series status messages for each individual options series (and in the case of complex orders, per-instrument) relating to events such as a delayed opening or trading halt. • ‘‘ArcaBook for Amex Options— Order Imbalance’’ makes available order imbalance information prior to the opening of the market and during a trading halt. • ‘‘ArcaBook for Amex Options— Depth of Book’’ makes available NYSE Amex Options quotes and orders at the first five price levels in each series on a real-time basis. • ‘‘ArcaBook for Amex Options— Complex’’ makes available NYSE Amex Options quote and trade information (including orders/quotes, requests for responses, and trades) for the complex order book on a real-time basis.5 The Exchange charges a single fee for its ArcaBook for Amex Options data product, which includes all six of the Current Options Products. The Exchange also charges a separate fee for ArcaBook for Amex Options—Complex 3 See Securities Exchange Act Release No. 67719 (August 23, 2012), 77 FR 52767 (August 30, 2012) (SR–NYSEMKT–2012–40) (proposing to offer certain proprietary options data products). 4 The OPRA Plan is a national market system plan approved by the Securities and Exchange Commission (‘‘Commission’’) pursuant to section 11A of the Securities Exchange Act of 1934 (the ‘‘Act’’) and Rule 608 thereunder (formerly Rule 11Aa3–2). See Securities Exchange Act Release No. 17638 (March 18, 1981), 22 S.E.C. Docket 484 (March 31, 1981). The full text of the OPRA Plan is available at https://www.opradata.com. The OPRA Plan provides for the collection and dissemination of last sale and quotation information on options that are traded on the participant exchanges. Section 5.2(c) of the OPRA Plan also permits OPRA Plan participants to disseminate unconsolidated market information to certain of their members under certain circumstances. 5 See Rule 6.62(e), which defines complex orders, and Rule 6.91, that describes electronic complex order trading, including requests for responses. VerDate Sep<11>2014 18:34 Oct 02, 2015 Jkt 238001 for subscribers that seek to obtain this Current Options Product on a standalone basis.6 The Exchange proposes to modify the Current Options Products as follows: First, the Exchange proposes to combine in one market data product, called ‘‘Amex Options Top,’’ the data made available currently in ‘‘ArcaBook for Amex Options—Trades,’’ ‘‘ArcaBook for Amex Options—Top of Book,’’ ‘‘ArcaBook for Amex Options—Series Status,’’ and ‘‘ArcaBook for Amex Options—Order Imbalance.’’ Offering a data product that combines, in one market data product, last sale data, BBO, and order imbalance information and series status messages, would provide greater efficiencies and better sequencing for vendors and subscribers that currently choose to integrate the data after receiving it from the Exchange. As with ArcaBook for Amex Options—Trades and ArcaBook for Amex Options—Top of Book, Amex Options Top would provide last sale and BBO information on a real-time basis as reported to OPRA and disseminated on a consolidated basis under the OPRA Plan.7 Other exchanges offer options data products that similarly combine data elements.8 Second, the Exchange proposes to modify ‘‘ArcaBook for Amex Options— Depth of Book’’ market data product so 6 See Securities Exchange Act Release No. 68004 (Oct. 9, 2012), 77 FR 62582 (Oct. 15, 2012) (SR– NYSEMKT–2012–49) (establishing fees for certain proprietary options market data products). See also Securities Exchange Act Release Nos. 69524 (May 6, 2013), 78 FR 27459 (May 10, 2013) (SR– NYSEMKT–2013–35) (establishing a schedule of NYSE Amex Options proprietary market data fees); 69553 (May 10, 2013), 78 FR 28926 (May 16, 2013) (SR–NYSEMKT–2013–40) (establishing non-display usage fees and amending the professional end-user fees); 71934 (April 11, 2014), 79 FR 21818 (April 17, 2014) (SR–NYSEMKT–2014–30) (amending the professional user fees); 73008 (Sept. 5, 2014), 79 FR 65325 [sic] (Sept. 11, 2014) (SR–NYSEMKT–2014– 73) (amending fees for non-display use); and 73589 (Nov. 13, 2014), 79 FR 68933 (Nov. 19, 2014) (SR– NYSEMKT–2014–94) (establishing fees for the complex order book feed). 7 See supra note 4. The manner in which the Exchange proposes to disseminate the products would comply with section 5.2(c) of the OPRA Plan, pursuant to which the Exchange may not disseminate the products ‘‘on any more timely basis than the same information is furnished to the OPRA System for inclusion in OPRA’s consolidated dissemination of Options Information.’’ 8 For example, Chicago Board Options Exchange (‘‘CBOE’’) and NASDAQ Options Market (‘‘NOM’’) and NASDAQ OMX PHLX LLC (‘‘PHLX’’) offer proprietary products that include both last sale and BBO information. See, e.g., Securities Exchange Act Release No. 73955 (Dec. 30, 2014), 80 FR 598 (Jan. 6, 2015) (SR–CBOE–2014–094); NOM Rules, Chapter VI, Section 1(a)(3) and Securities Exchange Act Release No. 64652 (June 13, 2011), 76 FR 35498 (June 17, 2011) (SR–NASDAQ–2011–075); and Securities Exchange Act Release No. 67352 (July 5, 2012), 77 FR 40930 (July 11, 2012) (SR–Phlx–2012– 83), respectively. PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 that quotes and orders would be available at the first three price levels in each series on a real-time basis rather than at the first five price levels. The Exchange also proposes to change the name of this product to ‘‘Amex Options Deep.’’ The Exchange believes that reducing the number of levels in the feed will reduce the size of the messages by a significant amount, which the Exchange anticipates will reduce customers’ bandwidth needs while retaining the functionality of this product. Finally, the Exchange proposes to change the name of the ‘‘ArcaBook for Arca [sic] Options—Complex’’ market data product to ‘‘Arca [sic] Options Complex.’’ The proposed Amex Options Top, Amex Options Deep and Amex Options Complex market data products (the ‘‘Amex Options Products’’) would be distributed in a new format, Exchange Data Protocol (XDP), aligning the format of the Amex Options Products with that of other market data products offered by the Exchange. This format change would not affect the real-time data content other than as described herein. The Exchange does not propose to make any changes to the fees. The single fee charged for the Current Options Products that comprise the ArcaBook for Amex Options market data product would similarly apply to subscribers to of all three proposed market data products—Amex Options Top, Amex Options Deep and Amex Options Complex. The standalone fee that now applies to ‘‘ArcaBook for Amex Options—Complex,’’ would likewise apply to Amex Options Complex market data product. The Exchange proposes to change the references to the names of the products in the NYSE Amex Options Proprietary Market Data Fee Schedule to the names of the products as proposed. As with the Current Options Products, each of the Amex Options Products would be offered through the Exchange’s Liquidity Center Network (‘‘LCN’’), a local area network in the Exchange’s Mahwah, New Jersey data center that is available to users of the Exchange’s co-location services. The Exchange would also offer the products through the Exchange’s Secure Financial Transaction Infrastructure (‘‘SFTI’’) network, through which all other users and member organizations access the Exchange’s trading and execution systems and other proprietary market data products. The Exchange will announce the date that the Amex Options Products will be available through an NYSE Market Data Notice. E:\FR\FM\05OCN1.SGM 05OCN1 Federal Register / Vol. 80, No. 192 / Monday, October 5, 2015 / Notices mstockstill on DSK4VPTVN1PROD with NOTICES The proposed change is not intended to address any issues other than those described herein, and the Exchange is not aware of any problems that vendors or subscribers would have in complying with the proposed change. 2. Statutory Basis The proposed rule change is consistent with section 6(b) 9 of the Act, in general, and furthers the objectives of section 6(b)(5) 10 of the Act, in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system and, in general, to protect investors and the public interest, and it is not designed to permit unfair discrimination among customers, brokers, or dealers. 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 improved options for receiving market data. The proposed rule changes would benefit investors by facilitating their prompt access to the real-time information contained in the Amex Options Products. In particular, the Exchange believes that combining last sale data, best bids and offers, order imbalance information and series status messages in the Amex Options Top product is reasonable because it would provide greater efficiencies and reduce errors for vendors and subscribers that currently choose to integrate the data after receiving it from the Exchange. In addition, the change to the Amex Options Deep product reflects the interests and needs of vendors by streamlining the product using smaller message sizes. The changes are reasonable because they would provide vendors and subscribers with higher quality market data products. 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 options data product changes proposed herein are precisely the sort of market data product evolutions 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 brokerdealers 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.11 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. The Exchange further notes that the existence of alternatives to the Exchange’s products, including realtime consolidated data, free delayed consolidated data, and proprietary data from other sources, ensures that the Exchange is not unreasonably discriminatory because vendors and subscribers can elect these alternatives. The proposed options data products will help to protect a free and open market by providing additional data to the marketplace and give investors greater choices. In addition, the proposal would not permit unfair discrimination because the products will be available to all of the Exchange’s customers and broker-dealers through both the LCN and SFTI. B. Self-Regulatory Organization’s Statement on Burden on Competition In accordance with section 6(b)(8) of the Act,12 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 market for proprietary data products is currently competitive and inherently contestable because there is fierce competition for the inputs necessary to the creation of proprietary data. Numerous exchanges compete with each other for listings, trades, and market data itself, providing virtually 9 15 Securities Exchange Act Release No. 51808 (June 9, 2005), 70 FR 37496 (June 29, 2005). 12 15 U.S.C. 78f(b)(8). U.S.C. 78f(b). U.S.C. 78f(b)(5). 10 15 VerDate Sep<11>2014 18:34 Oct 02, 2015 Jkt 238001 limitless opportunities for entrepreneurs who wish to produce and distribute their own market data. This proprietary data is produced by each individual exchange, as well as other entities (such as internalizing broker-dealers and various forms of alternative trading systems, including dark pools and electronic communication networks), in a vigorously competitive market. It is common for market participants to further and exploit this competition by sending their order flow and transaction reports to multiple markets, rather than providing them all to a single market. 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 13 and Rule 19b–4(f)(6) thereunder.14 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) of the Act and Rule 19b–4(f)(6)(iii) thereunder. A proposed rule change filed under Rule 19b–4(f)(6) 15 normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b4(f)(6)(iii),16 the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. 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 13 15 11 See PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 60203 U.S.C. 78s(b)(3)(A)(iii). CFR 240.19b–4(f)(6). 15 17 CFR 240.19b–4(f)(6). 16 17 CFR 240.19b–4(f)(6)(iii). 14 17 E:\FR\FM\05OCN1.SGM 05OCN1 60204 Federal Register / Vol. 80, No. 192 / Monday, October 5, 2015 / Notices under section 19(b)(2)(B) 17 of the Act to determine whether the proposed rule change 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 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 (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– NYSEMKT–2015–68 on the subject line. Paper Comments mstockstill on DSK4VPTVN1PROD with NOTICES • Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–NYSEMKT–2015–68. 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 (https://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 also will be available for inspection and copying at the principal offices 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– NYSEMKT–2015–68, and should be 17 15 U.S.C. 78s(b)(2)(B). VerDate Sep<11>2014 18:34 Oct 02, 2015 Jkt 238001 submitted on or before October 26, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.18 Robert W. Errett, Deputy Secretary. [FR Doc. 2015–25184 Filed 10–2–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–76019; File No. SR–BATS– 2015–56] Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Designation of a Longer Period for Commission Action on Proposed Rule Change, as Modified by Amendments Nos. 1 and 2, To List and Trade Shares of the ProShares Managed Futures Strategy ETF of the ProShares Trust Under BATS Rule 14.11 on BATS Exchange, Inc. September 29, 2015. On July 30, 2015, BATS Exchange, Inc. (‘‘BATS’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to list and trade shares of the ProShares Managed Futures Strategy ETF (‘‘Fund’’) of the ProShares Trust under BATS Rule 14.11(i). The proposed rule change was published for comment in the Federal Register on August 17, 2015.3 On August 19, 2015, the Exchange filed Amendment No. 1 to the proposed rule change.4 On September 4, 2015, the Exchange filed Amendment No. 2 to the proposed rule change.5 The Commission has received no comment letters on the proposed rule change. Section 19(b)(2) of the Act 6 provides that, within 45 days of the publication of notice of the filing of a proposed rule change, or within such longer period up to 90 days as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or as to which the 18 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 75664 (August 11, 2015), 80 FR 49288 (‘‘Notice’’). 4 Amendment No. 1 is available at: https:// www.sec.gov/comments/sr-bats-2015-56/ bats201556-.pdf. 5 Amendment No. 2 is available at: https:// www.sec.gov/comments/sr-bats-2015-56/ bats201556-2.pdf. 6 15 U.S.C. 78s(b)(2). 1 15 PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 self-regulatory organization consents, the Commission shall either approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether the proposed rule change should be disapproved. The Commission is extending this 45-day time period. The Commission finds that it is appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change, as modified by the amendments. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,7 designates November 15, 2015, as the date by which the Commission shall either approve or disapprove or institute proceedings to determine whether to disapprove the proposed rule change (File Number SR–BATS–2015–56). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 Robert W. Errett, Deputy Secretary. [FR Doc. 2015–25181 Filed 10–2–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–76017; File No. SR–EDGA– 2015–37] Self-Regulatory Organizations; EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 11.15, Clearly Erroneous Executions September 29, 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 September 21, 2015, EDGA Exchange, Inc. (the ‘‘Exchange’’ or ‘‘EDGA’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III 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. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to amend Rule 11.15, Clearly Erroneous 7 Id. 8 17 CFR 200.30–3(a)(31). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\05OCN1.SGM 05OCN1

Agencies

[Federal Register Volume 80, Number 192 (Monday, October 5, 2015)]
[Notices]
[Pages 60201-60204]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-25184]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76022; File No. SR-NYSEMKT-2015-68]


Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and 
Immediate Effectiveness of Proposed Rule Change Modifying Certain 
Proprietary Options Data Products

September 29, 2015.
    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 September 18, 2015, NYSE MKT LLC (the ``Exchange'' or ``NYSE MKT'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I, II, and III 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.
---------------------------------------------------------------------------

    \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 modify certain proprietary options data 
products. 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.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to modify certain proprietary options data 
products.

[[Page 60202]]

    The Exchange currently offers the following real-time options 
market data feeds through its ArcaBook for Amex Options data product 
(collectively, ``Current Options Products''): \3\
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    \3\ See Securities Exchange Act Release No. 67719 (August 23, 
2012), 77 FR 52767 (August 30, 2012) (SR-NYSEMKT-2012-40) (proposing 
to offer certain proprietary options data products).
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     ``ArcaBook for Amex Options--Trades'' makes available NYSE 
Amex Options last sale information on a real-time basis as it is 
reported to the Options Price Reporting Authority (``OPRA'') and 
disseminated on a consolidated basis under the OPRA Plan.\4\
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    \4\ The OPRA Plan is a national market system plan approved by 
the Securities and Exchange Commission (``Commission'') pursuant to 
section 11A of the Securities Exchange Act of 1934 (the ``Act'') and 
Rule 608 thereunder (formerly Rule 11Aa3-2). See Securities Exchange 
Act Release No. 17638 (March 18, 1981), 22 S.E.C. Docket 484 (March 
31, 1981). The full text of the OPRA Plan is available at https://www.opradata.com. The OPRA Plan provides for the collection and 
dissemination of last sale and quotation information on options that 
are traded on the participant exchanges. Section 5.2(c) of the OPRA 
Plan also permits OPRA Plan participants to disseminate 
unconsolidated market information to certain of their members under 
certain circumstances.
---------------------------------------------------------------------------

     ``ArcaBook for Amex Options--Top of Book'' makes available 
NYSE Amex Options best bids and offers (``BBO'') (including orders and 
quotes) on a real-time basis as reported to OPRA and disseminated on a 
consolidated basis under the OPRA Plan.
     ``ArcaBook for Amex Options--Series Status'' makes 
available series status messages for each individual options series 
(and in the case of complex orders, per-instrument) relating to events 
such as a delayed opening or trading halt.
     ``ArcaBook for Amex Options--Order Imbalance'' makes 
available order imbalance information prior to the opening of the 
market and during a trading halt.
     ``ArcaBook for Amex Options--Depth of Book'' makes 
available NYSE Amex Options quotes and orders at the first five price 
levels in each series on a real-time basis.
     ``ArcaBook for Amex Options--Complex'' makes available 
NYSE Amex Options quote and trade information (including orders/quotes, 
requests for responses, and trades) for the complex order book on a 
real-time basis.\5\
---------------------------------------------------------------------------

    \5\ See Rule 6.62(e), which defines complex orders, and Rule 
6.91, that describes electronic complex order trading, including 
requests for responses.
---------------------------------------------------------------------------

    The Exchange charges a single fee for its ArcaBook for Amex Options 
data product, which includes all six of the Current Options Products. 
The Exchange also charges a separate fee for ArcaBook for Amex 
Options--Complex for subscribers that seek to obtain this Current 
Options Product on a standalone basis.\6\
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    \6\ See Securities Exchange Act Release No. 68004 (Oct. 9, 
2012), 77 FR 62582 (Oct. 15, 2012) (SR-NYSEMKT-2012-49) 
(establishing fees for certain proprietary options market data 
products). See also Securities Exchange Act Release Nos. 69524 (May 
6, 2013), 78 FR 27459 (May 10, 2013) (SR-NYSEMKT-2013-35) 
(establishing a schedule of NYSE Amex Options proprietary market 
data fees); 69553 (May 10, 2013), 78 FR 28926 (May 16, 2013) (SR-
NYSEMKT-2013-40) (establishing non-display usage fees and amending 
the professional end-user fees); 71934 (April 11, 2014), 79 FR 21818 
(April 17, 2014) (SR-NYSEMKT-2014-30) (amending the professional 
user fees); 73008 (Sept. 5, 2014), 79 FR 65325 [sic] (Sept. 11, 
2014) (SR-NYSEMKT-2014-73) (amending fees for non-display use); and 
73589 (Nov. 13, 2014), 79 FR 68933 (Nov. 19, 2014) (SR-NYSEMKT-2014-
94) (establishing fees for the complex order book feed).
---------------------------------------------------------------------------

    The Exchange proposes to modify the Current Options Products as 
follows:
    First, the Exchange proposes to combine in one market data product, 
called ``Amex Options Top,'' the data made available currently in 
``ArcaBook for Amex Options--Trades,'' ``ArcaBook for Amex Options--Top 
of Book,'' ``ArcaBook for Amex Options--Series Status,'' and ``ArcaBook 
for Amex Options--Order Imbalance.'' Offering a data product that 
combines, in one market data product, last sale data, BBO, and order 
imbalance information and series status messages, would provide greater 
efficiencies and better sequencing for vendors and subscribers that 
currently choose to integrate the data after receiving it from the 
Exchange. As with ArcaBook for Amex Options--Trades and ArcaBook for 
Amex Options--Top of Book, Amex Options Top would provide last sale and 
BBO information on a real-time basis as reported to OPRA and 
disseminated on a consolidated basis under the OPRA Plan.\7\ Other 
exchanges offer options data products that similarly combine data 
elements.\8\
---------------------------------------------------------------------------

    \7\ See supra note 4. The manner in which the Exchange proposes 
to disseminate the products would comply with section 5.2(c) of the 
OPRA Plan, pursuant to which the Exchange may not disseminate the 
products ``on any more timely basis than the same information is 
furnished to the OPRA System for inclusion in OPRA's consolidated 
dissemination of Options Information.''
    \8\ For example, Chicago Board Options Exchange (``CBOE'') and 
NASDAQ Options Market (``NOM'') and NASDAQ OMX PHLX LLC (``PHLX'') 
offer proprietary products that include both last sale and BBO 
information. See, e.g., Securities Exchange Act Release No. 73955 
(Dec. 30, 2014), 80 FR 598 (Jan. 6, 2015) (SR-CBOE-2014-094); NOM 
Rules, Chapter VI, Section 1(a)(3) and Securities Exchange Act 
Release No. 64652 (June 13, 2011), 76 FR 35498 (June 17, 2011) (SR-
NASDAQ-2011-075); and Securities Exchange Act Release No. 67352 
(July 5, 2012), 77 FR 40930 (July 11, 2012) (SR-Phlx-2012-83), 
respectively.
---------------------------------------------------------------------------

    Second, the Exchange proposes to modify ``ArcaBook for Amex 
Options--Depth of Book'' market data product so that quotes and orders 
would be available at the first three price levels in each series on a 
real-time basis rather than at the first five price levels. The 
Exchange also proposes to change the name of this product to ``Amex 
Options Deep.'' The Exchange believes that reducing the number of 
levels in the feed will reduce the size of the messages by a 
significant amount, which the Exchange anticipates will reduce 
customers' bandwidth needs while retaining the functionality of this 
product.
    Finally, the Exchange proposes to change the name of the ``ArcaBook 
for Arca [sic] Options--Complex'' market data product to ``Arca [sic] 
Options Complex.''
    The proposed Amex Options Top, Amex Options Deep and Amex Options 
Complex market data products (the ``Amex Options Products'') would be 
distributed in a new format, Exchange Data Protocol (XDP), aligning the 
format of the Amex Options Products with that of other market data 
products offered by the Exchange. This format change would not affect 
the real-time data content other than as described herein.
    The Exchange does not propose to make any changes to the fees. The 
single fee charged for the Current Options Products that comprise the 
ArcaBook for Amex Options market data product would similarly apply to 
subscribers to of all three proposed market data products--Amex Options 
Top, Amex Options Deep and Amex Options Complex. The standalone fee 
that now applies to ``ArcaBook for Amex Options--Complex,'' would 
likewise apply to Amex Options Complex market data product. The 
Exchange proposes to change the references to the names of the products 
in the NYSE Amex Options Proprietary Market Data Fee Schedule to the 
names of the products as proposed.
    As with the Current Options Products, each of the Amex Options 
Products would be offered through the Exchange's Liquidity Center 
Network (``LCN''), a local area network in the Exchange's Mahwah, New 
Jersey data center that is available to users of the Exchange's co-
location services. The Exchange would also offer the products through 
the Exchange's Secure Financial Transaction Infrastructure (``SFTI'') 
network, through which all other users and member organizations access 
the Exchange's trading and execution systems and other proprietary 
market data products.
    The Exchange will announce the date that the Amex Options Products 
will be available through an NYSE Market Data Notice.

[[Page 60203]]

    The proposed change is not intended to address any issues other 
than those described herein, and the Exchange is not aware of any 
problems that vendors or subscribers would have in complying with the 
proposed change.
2. Statutory Basis
    The proposed rule change is consistent with section 6(b) \9\ of the 
Act, in general, and furthers the objectives of section 6(b)(5) \10\ of 
the Act, in particular, in that it is designed to prevent fraudulent 
and manipulative acts and practices, to promote just and equitable 
principles of trade, to foster cooperation and coordination with 
persons engaged in facilitating transactions in securities, to remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system and, in general, to protect investors and the 
public interest, and it is not designed to permit unfair discrimination 
among customers, brokers, or dealers.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    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 improved options for receiving market data. 
The proposed rule changes would benefit investors by facilitating their 
prompt access to the real-time information contained in the Amex 
Options Products.
    In particular, the Exchange believes that combining last sale data, 
best bids and offers, order imbalance information and series status 
messages in the Amex Options Top product is reasonable because it would 
provide greater efficiencies and reduce errors for vendors and 
subscribers that currently choose to integrate the data after receiving 
it from the Exchange. In addition, the change to the Amex Options Deep 
product reflects the interests and needs of vendors by streamlining the 
product using smaller message sizes. The changes are reasonable because 
they would provide vendors and subscribers with higher quality market 
data products.
    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 options data product changes proposed herein are precisely the 
sort of market data product evolutions 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.\11\
---------------------------------------------------------------------------

    \11\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37496 (June 29, 2005).

    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.
    The Exchange further notes that the existence of alternatives to 
the Exchange's products, including real-time consolidated data, free 
delayed consolidated data, and proprietary data from other sources, 
ensures that the Exchange is not unreasonably discriminatory because 
vendors and subscribers can elect these alternatives.
    The proposed options data products will help to protect a free and 
open market by providing additional data to the marketplace and give 
investors greater choices. In addition, the proposal would not permit 
unfair discrimination because the products will be available to all of 
the Exchange's customers and broker-dealers through both the LCN and 
SFTI.

B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with section 6(b)(8) of the Act,\12\ 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 market for proprietary data products is 
currently competitive and inherently contestable because there is 
fierce competition for the inputs necessary to the creation of 
proprietary data. Numerous exchanges compete with each other for 
listings, trades, and market data itself, providing virtually limitless 
opportunities for entrepreneurs who wish to produce and distribute 
their own market data. This proprietary data is produced by each 
individual exchange, as well as other entities (such as internalizing 
broker-dealers and various forms of alternative trading systems, 
including dark pools and electronic communication networks), in a 
vigorously competitive market. It is common for market participants to 
further and exploit this competition by sending their order flow and 
transaction reports to multiple markets, rather than providing them all 
to a single market.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

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 \13\ and Rule 19b-4(f)(6) thereunder.\14\ 
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) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \14\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \15\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b4(f)(6)(iii),\16\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest.
---------------------------------------------------------------------------

    \15\ 17 CFR 240.19b-4(f)(6).
    \16\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    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

[[Page 60204]]

under section 19(b)(2)(B) \17\ of the Act to determine whether the 
proposed rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \17\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

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 (https://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-NYSEMKT-2015-68 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEMKT-2015-68. 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 (https://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 also will be available 
for inspection and copying at the principal offices 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-NYSEMKT-2015-
68, and should be submitted on or before October 26, 2015.
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    \18\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-25184 Filed 10-2-15; 8:45 am]
 BILLING CODE 8011-01-P
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