Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend BATS Rulebook Chapter XI To Add Four New Rules Regarding the Registration and Obligations of Market Makers and Amend Rule 1.5 To Add Definitions of “Market Maker” and “Market Maker Authorized Trader”, 57172-57174 [E8-23041]
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57172
Federal Register / Vol. 73, No. 191 / Wednesday, October 1, 2008 / Notices
All submissions should refer to File
Number SR-BATS–2008–004. This file
number should be included on the
subject line if e-mail 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 inspection and copying in
the Commission’s Public Reference
Room on official business days between
the hours of 10 a.m. and 3 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 Number SR-BATS–
2008–004 and should be submitted on
or before October 22, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–22961 Filed 9–30–08; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58644; File No. SR–BATS–
2008–005]
jlentini on PROD1PC65 with NOTICES
Self-Regulatory Organizations; BATS
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend BATS
Rulebook Chapter XI To Add Four New
Rules Regarding the Registration and
Obligations of Market Makers and
Amend Rule 1.5 To Add Definitions of
‘‘Market Maker’’ and ‘‘Market Maker
Authorized Trader’’
September 25, 2008.
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 19, 2008, BATS Exchange,
Inc. (‘‘BATS’’ or the ‘‘Exchange’’) 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.
BATS has designated the proposed rule
change as constituting a noncontroversial rule change under Rule
19b–4(f)(6) under the Act,3 which
renders the proposal effective upon
filing with the Commission. 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 is proposing to amend
Chapter XI of the BATS Rulebook to add
four new rules which would provide for
the registration and obligations of
market makers, as well as amending
Rule 1.5 to add the definitions of
‘‘Market Maker’’ and ‘‘Market Maker
Authorized Trader.’’
The text of the proposed rule change
is available at the Exchange’s Web site
at https://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 purpose of the proposed rule
change is to provide Members the
ability to register as Market Makers and
to provide for the regulation of Market
Makers. The process for registration as
a Market Maker is contained in
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 17 CFR 240.19b–4(f)(6).
Proposed Rule 11.5, which provides that
applicants must file applications in
such form as the Exchange may
prescribe. Applicants will be reviewed
by the Exchange, which will consider
factors including the capital, operations,
personnel, technical resources, and
disciplinary history of the applicant.
Each Market Maker must have and
maintain the minimum net capital of at
least the amount required by Rule 15c3–
1 of the Exchange Act.4 Pursuant to the
Proposed Rule, an applicant’s
registration as a Market Maker will
become effective upon receipt by the
Member of the Exchange’s notice of
approval of registration. The Proposed
Rule also provides that the registration
of a Market Maker may be suspended or
terminated by the Exchange if the
Exchange determines that the Market
Maker substantially or continually
failed to engage in dealings in
accordance with Exchange Rules, if the
Market Maker fails to meet the
minimum net capital conditions, or the
Market Maker fails to maintain fair and
orderly markets.
Proposed Rule 11.6 provides for the
registration and obligations of Market
Maker Authorized Traders (‘‘MMATs’’).
The Exchange can register a person as
a MMAT upon receiving an application
in the form prescribed, and MMATs are
permitted to enter orders only for the
account of the Market Maker for which
they are registered. MMATs may be
officers, partners, employees or other
associated persons of Members who are
registered as Market Makers. To be
eligible for registration as a MMAT, a
person must complete the training and
other programs required by the
Exchange and successfully complete the
General Securities Representative
Examination (Series 7). Market Makers
must ensure that their MMATs are
properly qualified to perform market
making activities. The Exchange may
suspend or withdraw the registration of
a MMAT if the Exchange determines
that the person has caused the Market
Maker to fail to comply with the
securities laws or rules of the Exchange,
if the person fails to perform his or her
responsibilities properly, or fails to
maintain fair and orderly markets. If a
MMAT is suspended, the Market Maker
may not allow the person to submit
orders. In addition, the registration of a
MMAT may be withdrawn upon the
written request of the Member for which
the MMAT is registered.
Proposed Rule 11.7 provides for the
registration of Market Makers in a
security. A Market Maker may become
registered in a newly authorized
2 17
18 17
CFR 200.30–3(a)(12).
VerDate Aug<31>2005
18:22 Sep 30, 2008
Jkt 214001
PO 00000
Frm 00126
Fmt 4703
4 17
Sfmt 4703
CFR 240.15c3–1.
E:\FR\FM\01OCN1.SGM
01OCN1
jlentini on PROD1PC65 with NOTICES
Federal Register / Vol. 73, No. 191 / Wednesday, October 1, 2008 / Notices
security or in a security already
admitted to dealings on the Exchange by
filing a security registration form with
the Exchange. In considering the
approval of the registration of the
Market Maker in a security, the
Exchange may consider the financial
resources available to the Market Maker,
the Market Maker’s experience in
making markets, the Market Maker’s
operational capability, the maintenance
and enhancement of competition among
Market Makers in each security in
which they are registered, the existence
of clearing arrangements for the Market
Maker’s transactions, and the character
of the market for the security. The
Proposed Rule also provides that a
Market Maker may voluntarily terminate
its registration in a security by
providing the Exchange with a written
notice of such termination. The
Exchange may require a certain
minimum prior notice period for such
termination and may place other
conditions on withdrawal and reregistration following withdrawal. The
Exchange may suspend or terminate any
registration of a Market Maker in a
security whenever it determines that the
Market Maker has not met any of its
obligations or has failed to maintain fair
and orderly markets.
Finally, Proposed Rule 11.8 sets out
the obligations of Market Makers. In
general, Market Makers must engage in
a course of dealings for their own
account to assist in the maintenance,
insofar as reasonably practicable, of fair
and orderly markets on the Exchange.
The responsibilities of Market Makers
include, among other things,
maintaining continuous limit orders to
buy and to sell for round lots in those
securities in which the Market Maker is
registered to trade. Market Makers will
be responsible for the acts and
omissions of its MMATs. If the
Exchange finds any substantial or
continued failure by a Market Maker to
engage in a course of dealing as
specified in this Rule, such Market
Maker will be subject to disciplinary
action or suspension or revocation of its
registration. A Market Maker may apply
to withdraw temporarily from its Market
Maker status in the securities for which
it is registered and must base this
request on demonstrated legal or
regulatory requirements that necessitate
its temporary withdrawal.5
These proposed rules will benefit all
Exchange participants, because Market
Makers will assist in the maintenance of
5 See electronic mail from Anders Franzon,
Associate General Counsel, BATS Trading, Inc., to
Sarah Albertson, Attorney, Division of Trading and
Markets, Commission, dated September 23, 2008.
VerDate Aug<31>2005
18:22 Sep 30, 2008
Jkt 214001
fair and orderly markets, provide
additional liquidity to the Exchange,
and assist in preventing excess
volatility.
2. Statutory Basis
The Exchange believes the proposal is
consistent with the requirements of the
Act and the rules and regulations
thereunder that are applicable to a
national securities exchange, and, in
particular, with the requirements of
Section 6(b).6 In particular, the
proposed changes are consistent with
Section 6(b)(5) of the Act,7 because they
would promote just and equitable
principles of trade, remove
impediments to, and perfect the
mechanism of, a free and open market
and a national market system, and, in
general, protect investors and the public
interest by creating greater liquidity in
the Exchange market.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change imposes any
burden on competition.
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.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The proposed rules are based on the
approved rules of another selfregulatory organization.8 In addition,
the Exchange believes that the proposed
rules will benefit all Exchange
participants, because Market Makers
will assist in the maintenance of fair
and orderly markets, provide additional
liquidity to the Exchange, and assist in
preventing excess volatility.
Accordingly, the Exchange has
designated this rule filing as noncontroversial under Section 19(b)(3)(A)
of the Act 9 and paragraph (f)(6) of Rule
19b–4 thereunder.10 In accordance with
Rule 19b–4(f)(6)(iii),11 the Exchange
submitted 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.
Because the foregoing proposed rule
change is non-controversial and does
6 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
8 See NSX Rules 1.5 and 11.5 through 11.8.
9 15 U.S.C. 78s(b)(3)(A).
10 17 CFR 240.19b–4.
11 17 CFR 240.19b–4(f)(6)(iii).
7 15
PO 00000
Frm 00127
Fmt 4703
Sfmt 4703
57173
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) of the Act 12 and Rule 19b–
4(f)(6) thereunder.13
At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
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.
III. 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 e-mail to rulecomments@sec.gov. Please include File
Number SR–BATS–2008–005 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–BATS–2008–005. This file
number should be included on the
subject line if e-mail 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 inspection and copying in
the Commission’s Public Reference
12 15
13 17
E:\FR\FM\01OCN1.SGM
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
01OCN1
57174
Federal Register / Vol. 73, No. 191 / Wednesday, October 1, 2008 / Notices
Room, on official business days between
the hours of 10 a.m. and 3 p.m. Copies
of the 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–BATS–
2008–005 and should be submitted on
or before October 22, 2008.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8–23041 Filed 9–30–08; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–58643; File Nos. SR–
FINRA–2008–021; SR–FINRA–2008–022;
SR–FINRA–2008–026; SR–FINRA–2008–028
and SR–FINRA–2008–029]
Self-Regulatory Organizations;
Financial Industry Regulatory
Authority, Inc.; Order Approving
Proposed Rule Change, as Modified by
Amendment No. 1, Relating to the
Adoption of NASD Rules 4000 Through
10000 Series and the 12000 Through
14000 Series as FINRA Rules in the
New Consolidated FINRA Rulebook;
Order Approving Proposed Rule
Change Relating to the Membership
Waive-In Process for Certain New York
Stock Exchange Members; Order
Approving Proposed Rule Change, as
Modified by Amendment No. 1, To
Adopt the FINRA Rule 0100 Series
(General Standards) in the
Consolidated FINRA Rulebook; Order
Approving Proposed Rule Change To
Adopt FINRA Rule 2010 (Standards of
Commercial Honor and Principles of
Trade), FINRA Rule 2020 (Use of
Manipulative, Deceptive or Other
Fraudulent Devices), and FINRA Rule
5150 (Fairness Opinions) in the
Consolidated FINRA Rulebook; and
Order Approving Proposed Rule
Change, as Modified by Amendment
No. 1, To Repeal NASD Rule 1130 and
Incorporated Rules 405A, 440F, 440G
and 447 as Part of the Process of
Developing the Consolidated FINRA
Rulebook
September 25, 2008.
jlentini on PROD1PC65 with NOTICES
I. Introduction
On May 23, 2008, the Financial
Industry Regulatory Authority, Inc
(‘‘FINRA’’) (f/k/a National Association
of Securities Dealers, Inc. (‘‘NASD’’)),
filed with the Securities and Exchange
Commission (‘‘Commission’’ or
‘‘Exchange’’), 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
adopt the following NASD rules (which
are part of the existing FINRA rulebook)
as FINRA rules into a new consolidated
rulebook (‘‘Consolidated FINRA
Rulebook’’): The 4000 through 10000
Series and the 12000 through 14000
Series (collectively, the ‘‘Marketplace
and Procedural Rules Proposal’’). The
Marketplace and Procedural Rules
Proposal, as modified by Amendment
No. 1, was published for comment in
1 15
14 17
CFR 200.30–3(a)(12).
VerDate Aug<31>2005
18:22 Sep 30, 2008
2 17
Jkt 214001
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00128
Fmt 4703
Sfmt 4703
the Federal Register on July 23, 2008.3
The Commission received no comments
on the Marketplace and Procedural
Rules Proposal. This order approves the
Marketplace and Procedural Rules
Proposal, as modified by Amendment
No. 1.
On May 23, 2008, FINRA filed with
the Commission, pursuant to Section
19(b)(1) of the Act and Rule 19b–4
thereunder, a proposed rule change
relating to the membership waive-in
process for certain New York Stock
Exchange LLC (‘‘NYSE’’) members
(‘‘Waive-In Firms Proposal’’). The
Waive-In Firms Proposal was published
for comment in the Federal Register on
July 28, 2008.4 The Commission
received no comments on the Waive-In
Firms Proposal. This order approves the
Waive-In Firms Proposal.
On June 13, 2008, FINRA filed with
the Commission, pursuant to Section
19(b)(1) of the Act and Rule 19b–4
thereunder, a proposed rule change to
adopt FINRA Rule 2010 (Standards of
Commercial Honor and Principles of
Trade), FINRA Rule 2020 (Use of
Manipulative, Deceptive or Other
Fraudulent Devices), and FINRA Rule
5150 (Fairness Opinions) in the
Consolidated FINRA Rulebook
(collectively, the ‘‘Ethical Conduct and
Fairness Opinion Rules Proposal’’). The
Ethical Conduct and Fairness Opinion
Rules Proposal was published for
comment in the Federal Register on July
10, 2008.5 The Commission received no
comments on this proposed rule change.
This order approves the Ethical Conduct
and Fairness Opinion Rules Proposal.
On June 16, 2008, FINRA filed with
the Commission, pursuant to Section
19(b)(1) of the Act and Rule 19b–4
thereunder, a proposed rule change to
adopt the FINRA Rule 0100 Series
(General Standards) in the Consolidated
FINRA Rulebook (‘‘General Standards
Proposal’’). The General Standards
Proposal, as modified by Amendment
No. 1, was published for comment in
the Federal Register on August 7, 2008.6
The Commission received no comments
on the General Standards Proposal. This
order approves the General Standards
Proposal as modified by Amendment
No. 1.
3 See Securities Exchange Act Release No. 58176
(July 16, 2008), 73 FR 42844 (July 23, 2008) (SR–
FINRA–2008–021) (‘‘Release No. 34–58176’’).
4 See Securities Exchange Act Release No. 58206
(July 22, 2008), 73 FR 43808 (July 28, 2008) (SR–
FINRA–2008–022).
5 See Securities Exchange Act Release No. 58095
(July 3, 2008), 73 FR 39751 (July 10, 2008) (SR–
FINRA–2008–028).
6 See Securities Exchange Act Release No. 58245
(July 29, 2008), 73 FR 46106 (August 7, 2008) (SR–
FINRA–2008–026).
E:\FR\FM\01OCN1.SGM
01OCN1
]]>Agencies
[Federal Register Volume 73, Number 191 (Wednesday, October 1, 2008)]
[Notices]
[Pages 57172-57174]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-23041]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-58644; File No. SR-BATS-2008-005]
Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend
BATS Rulebook Chapter XI To Add Four New Rules Regarding the
Registration and Obligations of Market Makers and Amend Rule 1.5 To Add
Definitions of ``Market Maker'' and ``Market Maker Authorized Trader''
September 25, 2008.
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 19, 2008, BATS Exchange, Inc. (``BATS'' or the
``Exchange'') 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. BATS has
designated the proposed rule change as constituting a non-controversial
rule change under Rule 19b-4(f)(6) under the Act,\3\ which renders the
proposal effective upon filing with the Commission. 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.
\3\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is proposing to amend Chapter XI of the BATS Rulebook
to add four new rules which would provide for the registration and
obligations of market makers, as well as amending Rule 1.5 to add the
definitions of ``Market Maker'' and ``Market Maker Authorized Trader.''
The text of the proposed rule change is available at the Exchange's
Web site at https://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 purpose of the proposed rule change is to provide Members the
ability to register as Market Makers and to provide for the regulation
of Market Makers. The process for registration as a Market Maker is
contained in Proposed Rule 11.5, which provides that applicants must
file applications in such form as the Exchange may prescribe.
Applicants will be reviewed by the Exchange, which will consider
factors including the capital, operations, personnel, technical
resources, and disciplinary history of the applicant. Each Market Maker
must have and maintain the minimum net capital of at least the amount
required by Rule 15c3-1 of the Exchange Act.\4\ Pursuant to the
Proposed Rule, an applicant's registration as a Market Maker will
become effective upon receipt by the Member of the Exchange's notice of
approval of registration. The Proposed Rule also provides that the
registration of a Market Maker may be suspended or terminated by the
Exchange if the Exchange determines that the Market Maker substantially
or continually failed to engage in dealings in accordance with Exchange
Rules, if the Market Maker fails to meet the minimum net capital
conditions, or the Market Maker fails to maintain fair and orderly
markets.
---------------------------------------------------------------------------
\4\ 17 CFR 240.15c3-1.
---------------------------------------------------------------------------
Proposed Rule 11.6 provides for the registration and obligations of
Market Maker Authorized Traders (``MMATs''). The Exchange can register
a person as a MMAT upon receiving an application in the form
prescribed, and MMATs are permitted to enter orders only for the
account of the Market Maker for which they are registered. MMATs may be
officers, partners, employees or other associated persons of Members
who are registered as Market Makers. To be eligible for registration as
a MMAT, a person must complete the training and other programs required
by the Exchange and successfully complete the General Securities
Representative Examination (Series 7). Market Makers must ensure that
their MMATs are properly qualified to perform market making activities.
The Exchange may suspend or withdraw the registration of a MMAT if the
Exchange determines that the person has caused the Market Maker to fail
to comply with the securities laws or rules of the Exchange, if the
person fails to perform his or her responsibilities properly, or fails
to maintain fair and orderly markets. If a MMAT is suspended, the
Market Maker may not allow the person to submit orders. In addition,
the registration of a MMAT may be withdrawn upon the written request of
the Member for which the MMAT is registered.
Proposed Rule 11.7 provides for the registration of Market Makers
in a security. A Market Maker may become registered in a newly
authorized
[[Page 57173]]
security or in a security already admitted to dealings on the Exchange
by filing a security registration form with the Exchange. In
considering the approval of the registration of the Market Maker in a
security, the Exchange may consider the financial resources available
to the Market Maker, the Market Maker's experience in making markets,
the Market Maker's operational capability, the maintenance and
enhancement of competition among Market Makers in each security in
which they are registered, the existence of clearing arrangements for
the Market Maker's transactions, and the character of the market for
the security. The Proposed Rule also provides that a Market Maker may
voluntarily terminate its registration in a security by providing the
Exchange with a written notice of such termination. The Exchange may
require a certain minimum prior notice period for such termination and
may place other conditions on withdrawal and re-registration following
withdrawal. The Exchange may suspend or terminate any registration of a
Market Maker in a security whenever it determines that the Market Maker
has not met any of its obligations or has failed to maintain fair and
orderly markets.
Finally, Proposed Rule 11.8 sets out the obligations of Market
Makers. In general, Market Makers must engage in a course of dealings
for their own account to assist in the maintenance, insofar as
reasonably practicable, of fair and orderly markets on the Exchange.
The responsibilities of Market Makers include, among other things,
maintaining continuous limit orders to buy and to sell for round lots
in those securities in which the Market Maker is registered to trade.
Market Makers will be responsible for the acts and omissions of its
MMATs. If the Exchange finds any substantial or continued failure by a
Market Maker to engage in a course of dealing as specified in this
Rule, such Market Maker will be subject to disciplinary action or
suspension or revocation of its registration. A Market Maker may apply
to withdraw temporarily from its Market Maker status in the securities
for which it is registered and must base this request on demonstrated
legal or regulatory requirements that necessitate its temporary
withdrawal.\5\
---------------------------------------------------------------------------
\5\ See electronic mail from Anders Franzon, Associate General
Counsel, BATS Trading, Inc., to Sarah Albertson, Attorney, Division
of Trading and Markets, Commission, dated September 23, 2008.
---------------------------------------------------------------------------
These proposed rules will benefit all Exchange participants,
because Market Makers will assist in the maintenance of fair and
orderly markets, provide additional liquidity to the Exchange, and
assist in preventing excess volatility.
2. Statutory Basis
The Exchange believes the proposal is consistent with the
requirements of the Act and the rules and regulations thereunder that
are applicable to a national securities exchange, and, in particular,
with the requirements of Section 6(b).\6\ In particular, the proposed
changes are consistent with Section 6(b)(5) of the Act,\7\ because they
would promote just and equitable principles of trade, remove
impediments to, and perfect the mechanism of, a free and open market
and a national market system, and, in general, protect investors and
the public interest by creating greater liquidity in the Exchange
market.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change imposes
any burden on competition.
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.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The proposed rules are based on the approved rules of another self-
regulatory organization.\8\ In addition, the Exchange believes that the
proposed rules will benefit all Exchange participants, because Market
Makers will assist in the maintenance of fair and orderly markets,
provide additional liquidity to the Exchange, and assist in preventing
excess volatility. Accordingly, the Exchange has designated this rule
filing as non-controversial under Section 19(b)(3)(A) of the Act \9\
and paragraph (f)(6) of Rule 19b-4 thereunder.\10\ In accordance with
Rule 19b-4(f)(6)(iii),\11\ the Exchange submitted 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.
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\8\ See NSX Rules 1.5 and 11.5 through 11.8.
\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4.
\11\ 17 CFR 240.19b-4(f)(6)(iii).
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Because the foregoing proposed rule change is non-controversial and
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) of the Act \12\ and Rule 19b-
4(f)(6) thereunder.\13\
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\12\ 15 U.S.C. 78s(b)(3)(A).
\13\ 17 CFR 240.19b-4(f)(6).
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At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate 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.
III. 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 e-mail to rule-comments@sec.gov. Please include
File Number SR-BATS-2008-005 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-BATS-2008-005. This file
number should be included on the subject line if e-mail 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 inspection and
copying in the Commission's Public Reference
[[Page 57174]]
Room, on official business days between the hours of 10 a.m. and 3 p.m.
Copies of the 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-BATS-2008-005 and should be submitted on
or before October 22, 2008.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-23041 Filed 9-30-08; 8:45 am]
BILLING CODE 8011-01-P
