Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing of a Proposed Rule Change To Enhance Quotation Requirements for Market Makers, 59305-59309 [2010-24059]
Download as PDF
Federal Register / Vol. 75, No. 186 / Monday, September 27, 2010 / Notices
automatically cancelled for an Options
Participant that lost its connection to
BOX, and upon a reconnection between
the Options Participant and the Trading
Host on the same trading day, the
Options Participant will be able to
retrieve any Session Order cancellation
notices when it reconnects.
BOX will inform Options Participants
via Information Circular about the
functionality and use of the Session
Order duration type and the
implementation date prior to its
implementation in the BOX trading
system.
2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the Act,8
in general, and Section 6(b)(5) of the
Act,9 in particular, in that it is designed
to foster cooperation and coordination
with persons engaged in regulating,
clearing, settling, processing
information with respect to, and
facilitating transactions in securities, to
remove impediments to and perfect the
mechanism for a free and open market
and a national market system and, in
general, to protect investors and the
public interest. In particular, the
Exchange believes that this proposed
rule change will benefit the marketplace
and protect investors because it will
reduce the risk of erroneous or stale
orders on the BOX Book in the event
that an Options Participant loses
connectivity with the Trading Host.
Furthermore, the proposed Session
Order will provide for the protection of
Options Participants and their
customers, who must bear the burden of
market risk for stale orders caused by
circumstances outside of their control,
as well as for the protection of investors
and the efficiency and fairness of the
market as a whole.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
srobinson on DSKHWCL6B1PROD with NOTICES
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
U.S.C. 78f(b).
9 15 U.S.C. 78f(b)(5).
VerDate Mar<15>2010
17:01 Sep 24, 2010
Jkt 220001
Because the foregoing rule 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 if consistent
with the protection of investors and the
public interest, provided that the selfregulatory organization has given the
Commission written notice of its intent
to file the proposed rule change at least
five business days prior to the date of
filing of the proposed rule change or
such shorter time as designated by the
Commission, the proposed rule change
has become effective pursuant to
Section 19(b)(3)(A) of the Act 10 and
Rule 19b–4(f)(6) thereunder.11
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 necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act.
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 e-mail to rulecomments@sec.gov. Please include File
Number SR–BX–2010–065 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
10 15
The Exchange has neither solicited
nor received comments on the proposed
rule change.
8 15
III. Basis for Summary Effectiveness
Pursuant to Section 19(b)(3) or for
Accelerated Effectiveness Pursuant to
Section 19(b)(2)
U.S.C. 78s(b)(3)(A).
11 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires that a self-regulatory
organization submit to the Commission written
notice of its intention 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 filing of the proposed change, or such
shorter time as designated by the Commission. The
Commission notes that the Exchange has satisfied
this requirement.
PO 00000
Frm 00100
Fmt 4703
Sfmt 4703
59305
All submissions should refer to File
Number SR–BX–2010–065. 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 website viewing and
printing in the Commission’s Public
Reference Room, located at 100 F Street,
NE., Washington, DC 20549, on business
days between the hours of 10 a.m. and
3 p.m. Copies of such 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–BX–2010–065 and should
be submitted on or before October 18,
2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–24077 Filed 9–24–10; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62954; File No. SR–BX–
2010–066]
Self-Regulatory Organizations;
NASDAQ OMX BX, Inc.; Notice of Filing
of a Proposed Rule Change To
Enhance Quotation Requirements for
Market Makers
September 20, 2010.
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 17, 2010, NASDAQ OMX
12 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
E:\FR\FM\27SEN1.SGM
27SEN1
59306
Federal Register / Vol. 75, No. 186 / Monday, September 27, 2010 / Notices
BX, Inc. (‘‘BX’’ 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.
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 filing with the
Commission a proposed rule change to
enhance quotation requirements for
market makers. The text of the proposed
rule change is below. Proposed new
language is in italics; proposed
deletions are in [brackets].3
*
*
*
*
*
[4613. Character of Quotations]
A member registered as an Equities
Market Maker shall engage in a course
of dealings for its own account to assist
in the maintenance, insofar as
reasonably practicable, of fair and
orderly markets in accordance with this
Rule.
srobinson on DSKHWCL6B1PROD with NOTICES
(a) Quotation Requirements and
Obligations
(1) Two-Sided Quote Obligation. For
each security in which a member is
registered as an Equities Market Maker,
the member shall be willing to buy and
sell such security for its own account on
a continuous basis and shall enter and
maintain a two-sided quotation
(‘‘Principal Quote’’), which is attributed
to the market maker by a special market
participant identifier (‘‘MPID’’) and is
displayed in the NASDAQ OMX BX
Equities Market at all times, subject to
the procedures for excused withdrawal
set forth in Rule 4619.
(A) A registered Equities Market
Maker must display a quotation size for
at least one normal unit of trading (or
a larger multiple thereof) when it is not
displaying a limit order in compliance
with SEC Rule 604, provided, however,
that a registered Equities Market Maker
may augment its displayed quotation
size to display limit orders priced at the
Equities Market Maker’s quotation.
Unless otherwise designated, a ‘‘normal
unit of trading’’ shall be 100 shares.
(B) The minimum quotation
increment for quotations of $1.00 or
above in all System Securities shall be
$0.01. The minimum quotation
3 Changes are marked to the rule text that appears
in the electronic manual of Nasdaq found at https://
nasdaqomxbx.cchwallstreet.com.
VerDate Mar<15>2010
17:01 Sep 24, 2010
Jkt 220001
increment in the System for quotations
below $1.00 in System Securities shall
be $0.0001.
(2) The first MPID issued to a member
pursuant to subparagraph (1) of this
rule, or Rule 4623, shall be referred to
as the member’s ‘‘Primary MPID.’’
Market makers and ECNs may request
the use of additional MPIDs that shall
be referred to as ‘‘Supplemental MPIDs.’’
A market maker may request the use of
a Supplemental MPIDs for displaying
Attributable Quotes/Orders in the
Exchange’s Quotation Montage for any
security in which it is registered and
meets the obligations set forth in
subparagraph (1) of this rule. An ECN
may request the use of Supplemental
MPIDS for displaying Attributable
Quotes/Orders in the Exchange’s
Quotation Montage for any security in
which it meets the obligations set forth
in Rule 4623. A market maker or ECN
that ceases to meet the obligations
appurtenant to its Primary MPID in any
security shall not be permitted to use a
Supplemental MPID for any purpose in
that security.
(3) Market makers and ECNs that are
permitted the use of Supplemental
MPIDs for displaying Attributable
Quotes/Orders pursuant to
subparagraph (2) of this rule are subject
to the same rules applicable to the
member’s first quotation, with two
exceptions: (a) The continuous twosided quote requirement and excused
withdrawal procedures described in
subparagraph (1) above do not apply to
market maker’s Supplemental MPIDs;
and (b) Supplemental MPIDs may not be
used by market makers to enter
stabilizing bids pursuant to Equity Rule
4614.]
4613. Market Maker Obligations
A member registered as an Equities
Market Maker shall engage in a course
of dealings for its own account to assist
in the maintenance, insofar as
reasonably practicable, of fair and
orderly markets in accordance with this
Rule.
(a) Quotation Requirements and
Obligations
(1) Two-Sided Quote Obligation. For
each security in which a member is
registered as a Equities Market Maker,
the member shall be willing to buy and
sell such security for its own account on
a continuous basis during regular
market hours and shall enter and
maintain a two-sided trading interest
(‘‘Two-Sided Obligation’’) that is
identified to the Exchange as the
interest meeting the obligation and is
displayed in the Exchange’s quotation
montage at all times. Interest eligible to
PO 00000
Frm 00101
Fmt 4703
Sfmt 4703
be considered as part of an Equities
Market Maker’s Two-Sided Obligation
shall have a displayed quotation size of
at least one normal unit of trading (or
a larger multiple thereof); provided,
however, that an Equities Market Maker
may augment its Two-Sided Obligation
size to display limit orders priced at the
same price as the Two-Sided Obligation.
Unless otherwise designated, a ‘‘normal
unit of trading’’ shall be 100 shares.
After an execution against its TwoSided Obligation, Equities a Market
Maker must ensure that additional
trading interest exists in the Exchange
to satisfy its Two-Sided Obligation
either by immediately entering new
interest to comply with this obligation to
maintain continuous two-sided
quotations or by identifying existing
interest on the Exchange book that will
satisfy this obligation.
(2) Pricing Obligations. For NMS
stocks (as defined in Rule 600 under
Regulation NMS) an Equities Market
Maker shall adhere to the pricing
obligations established by this Rule
during Regular Market Hours.
(A) Bid Quotations. At the time of
entry of bid interest satisfying the TwoSided Obligation, the price of the bid
interest shall be not more than the
Designated Percentage away from the
then current National Best Bid, or if no
National Best Bid, not more than the
Designated Percentage away from the
last reported sale from the responsible
single plan processor. In the event that
the National Best Bid (or if no National
Best Bid, the last reported sale)
increases to a level that would cause the
bid interest of the Two-Sided Obligation
to be more than the Defined Limit away
from the National Best Bid (or if no
National Best Bid, the last reported
sale), or if the bid is executed or
cancelled, the Equities Market Maker
shall enter new bid interest at a price
not more than the Designated
Percentage away from the then current
National Best Bid (or if no National Best
Bid, the last reported sale), or identify
to the Exchange current resting interest
that satisfies the Two-Sided Obligation.
(B) Offer Quotations.—At the time of
entry of offer interest satisfying the TwoSided Obligation, the price of the offer
interest shall be not more than the
Designated Percentage away from the
then current National Best Offer, or if no
National Best Offer, not more than the
Designated Percentage away from the
last reported sale received from the
responsible single plan processor. In the
event that the National Best Offer (or if
no National Best Offer, the last reported
sale) decreases to a level that would
cause the offer interest of the Two-Sided
Obligation to be more than the Defined
E:\FR\FM\27SEN1.SGM
27SEN1
srobinson on DSKHWCL6B1PROD with NOTICES
Federal Register / Vol. 75, No. 186 / Monday, September 27, 2010 / Notices
Limit away from the National Best Offer
(or if no National Best Offer, the last
reported sale), or if the offer is executed
or cancelled, the Equities Market Maker
shall enter new offer interest at a price
not more than the Designated
Percentage away from the then current
National Best Offer (or if no National
Best Offer, the last reported sale), or
identify to the Exchange current resting
interest that satisfies the Two-Sided
Obligation.
(C) The National Best Bid and Offer
shall be determined by the Exchange in
accordance with its procedures for
determining protected quotations under
Rule 600 under Regulation NMS.
(D) For purposes of this Rule, the term
‘‘Designated Percentage’’ shall mean the
individual stock pause trigger
percentage under Rule 4120(a)(11) (or
comparable rule of another exchange)
less two (2) percentage points. For times
during regular market hours when stock
pause triggers are not in effect under
Rule 4120(a)(11) (or comparable rule of
another exchange), the Designated
Percentage calculation will assume a
trigger percentage of 22%. For NMS
stocks that are not subject to such stock
pause triggers the Designated
Percentage will assume a trigger
percentage of 32%.
(E) For purposes of this Rule, the term
‘‘Defined Limit’’ shall mean the
individual stock pause trigger
percentage under Rule 4120(a)(11) (or
comparable rule of another exchange)
less one-half (1⁄2) percentage point. For
times during regular market hours when
stock pause triggers are not in effect
under Rule 4120(a)(11) (or comparable
rule of another exchange), the Defined
Limit calculation will assume a trigger
percentage of 22%. For NMS stocks that
are not subject to such stock pause
triggers the Defined Limit calculation
will assume a trigger percentage of 32%.
(F) Quotation Creation and
Adjustment. For each Issue in which an
Equities Market Maker is registered, the
System shall automatically create a
quotation for display to comply with
this Rule. System-created compliant
displayed quotations will thereafter be
allowed to rest and not be further
adjusted by the System unless the
relationship between the quotation and
its related National Best Bid or National
Best Offer, as appropriate, shrinks to the
greater of: (a) 4 percentage points, or, (b)
one-quarter the applicable percentage
necessary to trigger an individual stock
trading pause as described in NASDAQ
OMX BX Rule 4120(a)(11), or expands
to within that same percentage less
0.5%, whereupon the System will
immediately re-adjust and display the
Equities Market Maker’s quote to the
VerDate Mar<15>2010
17:01 Sep 24, 2010
Jkt 220001
appropriate Designated Percentage set
forth in section (D) above. As the System
allows for multiple attributable
quotations by a Equities Market Maker
in an issue, quotations originally
entered by Equities Market Makers shall
be allowed to move freely towards or
away from the National Best Bid or
National Best Offer, as appropriate, for
potential execution.
(G) Quotation Refresh After
Execution. In the event of an execution
against a System-created compliant
quotation, the Equities Market Maker
shall have its quote refreshed by the
System on the executed side of the
market at the applicable Designated
Percentage away from the then National
Best Bid (Offer) (or if no National Best
Bid (Offer), the last reported sale).
(H) Nothing in this Rule shall
preclude an Equities Market Maker from
quoting at price levels that are closer to
the National Best Bid and Offer than the
levels required by this Rule.
(I) The minimum quotation increment
for quotations of $1.00 or above in all
System Securities shall be $0.01. The
minimum quotation increment in the
System for quotations below $1.00 in
System Securities shall be $0.0001.
(J) The individual Market Participant
Identifier (‘‘MPID’’) assigned to a
member to meet its Two-Sided
Obligation pursuant to subparagraph
(a)(1) of this Rule, or Rule 4623, shall be
referred to as the member’s ‘‘Primary
MPID.’’ Equities Market Makers and
ECNs may request the use if additional
MPIDs that shall be referred to as
‘‘Supplemental MPIDs.’’ An Equities
Market Maker may request the use of
Supplemental MPIDs for displaying
Attributable Quotes/Orders in the
Quotation Montage for any security in
which it is registered and meets the
obligations set forth in subparagraph (1)
of this rule. An ECN may request the use
of Supplemental MPIDs for displaying
Attributable Quotes/Orders in the
Quotation Montage for any security in
which it meets the obligations set forth
in Rule 4623. An Equities Market Maker
or ECN that ceases to meet the
obligations appurtenant to its Primary
MPID in any security shall not be
permitted to use a Supplemental MPID
for any purpose in that security.
(K) Equities Market Makers and ECNs
that are permitted the use of
Supplemental MPIDs for displaying
Attributable Quotes/Orders pursuant to
subparagraph (2) of this rule are subject
to the same rules applicable to the
members’ first quotation, with two
exceptions: (a) The continuous twosided quote requirement and excused
withdrawal procedures described in
subparagraph (1) above do not apply to
PO 00000
Frm 00102
Fmt 4703
Sfmt 4703
59307
Equities Market Makers’ Supplemental
MPIDs; and (b) Supplemental MPIDs
may not be used by Equities Market
Makers to engage in passive market
making or to enter stabilizing bids
pursuant to Rule 4614.
(b)–(e) No Change.
*
*
*
*
*
(b) Not applicable.
(c) Not applicable.
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 aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
Market Maker Quote Obligations:
The Exchange proposes to adopt rules
to enhance minimum quotation
requirements for market makers. Under
the proposal, the Exchange will require
market makers for each stock in which
they are registered to continuously
maintain a two-sided quotation within a
designated percentage of the National
Best Bid and National Best Offer as
appropriate. These enhanced market
maker quotation requirements are
intended to eliminate trade executions
against market maker placeholder
quotations traditionally priced far away
from the inside market, commonly
known as ‘‘stub quotes.’’ They are also
intended to augment and work in
relation to the single stock pause
standards already in place on a pilot
basis for stocks in the S&P 500, Russell
1000, and specified ETFs.4 Under the
proposal, the Exchange will require
registered market makers to enter and
maintain quotes priced at no more than
a certain percentage away from the
national inside bid and offer.
Permissible quotes are determined by
the individual character of the security,
the time of day in which the quote is
entered, and other factors which are
summarized below:
4 See Exchange Act Release No. 62884 (September
10, 2010).
E:\FR\FM\27SEN1.SGM
27SEN1
srobinson on DSKHWCL6B1PROD with NOTICES
59308
Federal Register / Vol. 75, No. 186 / Monday, September 27, 2010 / Notices
For issues subject to an individual
stock trading trigger pause, a
permissible quote is determined by first
looking at the applicable stock trading
pause trigger percentage of the security
and then reducing that number by 2%.
Since currently the stock pause trigger
percentage across all exchanges is 10%,
a market maker’s quote in such a
security may not be more than 8% away
from the national best bid or best offer
as appropriate. Once a compliant quote
is entered, it may rest without
adjustment until such time as it moves
to within 1⁄2 of 1% of the applicable
trigger pause percentage (i.e., currently
9.5%) whereupon the market maker
must immediately move its quote back
to at least the permissible default level
of 8% away from the national best bid
or best offer. During times in which a
trigger pause percentage is not
applicable (e.g. before 9:45 a.m. and
after 3:35 p.m.), a market maker must
maintain a quote no further than 20%
away from the inside (i.e. it may rest
without adjustment until it reaches
21.5%). In the absence of national best
or best offer, the above calculations will
remain the same, but will use the
national last sale instead of the absent
bid or offer.
For securities not subject to any
individual stock pause trigger, the
proposal will a [sic] assume a
hypothetical 32% trigger pause, apply a
2% reduction, and require market
makers in those issues to maintain
quotes no more than 30% away from the
national best and national best offer.
Like securities subject to stock trading
pauses, once a compliant quote is
entered, it may rest without adjustment
until such time as it moves to within 1⁄2
of 1% of its applicable trigger pause
percentage (31.5%) whereupon the
market maker must immediately move
its quote back to at least the permissible
default level of 30%. These
requirements shall apply to Regulation
NMS securities during normal market
hours.
Nothing in the above precludes a
market maker from voluntarily quoting
at price levels that are closer to the
national best bid and best offer than
required under the proposal.
Automated Quote Management:
In order to assist market makers in
meeting their enhanced quotation
obligations, the Exchange will also
provide automated quote management
functionality. For each issue in which a
market maker is registered, the
Exchange will automatically create a
quotation for display to comply with
this standard set forth in this proposal.
Compliant displayed quotations will
thereafter be allowed to rest and not be
VerDate Mar<15>2010
17:01 Sep 24, 2010
Jkt 220001
further adjusted by the Exchange unless
the relationship between the quotation
and its related national best bid or
national best offer, as appropriate,
shrinks to the greater of: (a) 4 percentage
points, or, (b) one-quarter the applicable
percentage necessary to trigger an
individual stock trading pause as
described in NASDAQ OMX BX Rule
4120(a)(11), or expands to within that
same percentage less 0.5%, whereupon
the Exchange will immediately re-adjust
and display the market maker’s quote to
the appropriate designated percentage.
Quotations originally entered by market
makers shall be allowed to move freely
towards the national best bid or national
best offer, as appropriate, for potential
execution.
In the event of an execution against a
System-created compliant quotation, the
market maker shall have its quote
refreshed by the System on the executed
side of the market at the applicable
designated percentage away from the
then national best bid (offer), or if no
national best bid (offer), the last
reported sale.
Previously Approved Rule Text:
Finally, the sections (I), (J) and (K) of
the proposed rule are portions of
previously approved text of Rule 4613
that have moved so as to group the
proposed market making standard
sections together within the rule.
2. Statutory Basis
The statutory basis for the proposed
rule change is Section 6(b)(5) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),5 which requires the rules of an
exchange 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, in
general, to protect investors and the
public interest. The proposed rule
change also is designed to support the
principles of Section 11A(a)(1) 6 of the
Act in that it seeks to assure fair
competition among brokers and dealers
and among exchange markets. The
Exchange believes that the proposed
rule meets these requirements in that it
promotes transparency and uniformity
across markets concerning minimum
market maker quotation requirements.
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, as amended.
5 15
6 15
PO 00000
U.S.C. 78f(b)(5).
U.S.C. 78k–1(a)(1).
Frm 00103
Fmt 4703
Sfmt 4703
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of
publication of this notice in the Federal
Register or within such longer period (i)
as the Commission may designate up to
90 days of such date if it finds such
longer period to be appropriate and
publishes its reasons for so finding or
(ii) as to which the Exchange consents,
the Commission shall: (a) By order
approve or disapprove such proposed
rule change, or (b) institute proceedings
to determine whether the proposed rule
change should be 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 e-mail to rulecomments@sec.gov. Please include File
Number SR–BX–2010–066 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
Station Place, 100 F Street, NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BX–2010–066. 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
E:\FR\FM\27SEN1.SGM
27SEN1
Federal Register / Vol. 75, No. 186 / Monday, September 27, 2010 / Notices
provisions of 5 U.S.C. 552, will be
available for inspection and copying in
the Commission’s Public Reference
Room, 100 F Street, NE., Washington,
DC 20549, on official business days
between the hours of 10 a.m. and 3 p.m.
Copies of such 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 publicly available. All
submissions should refer to File
Number SR–BX–2010–066 and should
be submitted on or before October 18,
2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–24059 Filed 9–24–10; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62951; File No. SR–CBOE–
2010–087]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing of a
Proposed Rule Change Related to
CBSX Market-Maker Obligations
September 20, 2010.
srobinson on DSKHWCL6B1PROD with NOTICES
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 17, 2010, Chicago Board
Options Exchange, Incorporated
(‘‘CBOE’’ or the ‘‘Exchange’’) 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
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
CBOE Stock Exchange’s (‘‘CBSX’’, the
CBOE’s stock trading facility) rules to
enhance quotation requirements. The
text of the rule proposal is available on
the Exchange’s Web site (https://
7 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
VerDate Mar<15>2010
17:01 Sep 24, 2010
Jkt 220001
www.cboe.org/legal), at the Exchange’s
Office of the Secretary and at the
Commission.
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
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to adopt rules
to enhance minimum quotation
requirements for CBSX Remote MarketMakers, CBSX Designated Primary
Market-Makers (‘‘CBSX DPMs’’), and
CBSX Lead Market-Makers (‘‘CBSX
LMMs’’) (collectively ‘‘CBSX MarketMakers’’). Under the proposal, the
Exchange will amend Rules 53.23,
Obligations of CBSX Remote MarketMakers, and Rule 53.56, CBSX DPM
Obligations,3 to require CBSX MarketMakers for each stock in which they are
registered to continuously maintain a
two-sided quotation within a designated
percentage of the National Best Bid and
National Best Offer as appropriate
during CBSX Regular Trading Hours
after the primary listing market has
disseminated an opening quote in the
stock on a given trading day.4 These
enhanced market maker quotation
obligations and [sic] are intended to
3 The Exchange notes that no change is necessary
to the text related to CBSX LMM obligations as
existing Rule 53.51, CBSX LMM Defined, already
provides that CBSX LMMs will have the same
obligations of CBSX Remote Market-Makers plus
those additional obligations of CBSX DPMs.
4 A CBSX Remote Market-Maker would be
obligated to provide continuous quotes only when
the CBSX Remote Market-Maker is quoting in a
particular security during CBSX Regular Trading
Hours after the primary listing market has
disseminated an opening quote in the stock on a
given trading day. See proposed Rule 53.23.01(a),
which is similar to CBOE’s existing rule for options
Market-Makers, Rule 8.7(d)(iii). A CBSX DPM or
CBSX LMM would be obligated to provide
continuous quotes during the CBSX Regular
Trading Hours after the primary listing market has
disseminated an opening quote in the stock on a
given trading day. See proposed Rule 53.56.01(a),
which is similar to CBOE’s existing rules for
options DPMs and LMMs, Rules 8.85(a)(i) and
8.15A(b)(i).
PO 00000
Frm 00104
Fmt 4703
Sfmt 4703
59309
eliminate trade executions against
market maker placeholder quotations
traditionally priced far away from the
inside market, commonly known as
‘‘stub quotes.’’ They are also intended to
augment and work in relation to the
single stock pause standards already in
place on a pilot basis for stocks in the
S&P 500, the Russell 1000 and certain
exchange-trade products.5
Under the proposal, the Exchange will
require CBSX Market-Makers to enter
and maintain quotes priced at no more
than a certain percentage away from the
national inside bid and offer.
Permissible quotes are determined by
the individual character of the security,
the time of day in which the quote is
entered, and other factors which are
summarized below:
For issues subject to an individual
stock trading trigger pause, a
permissible quote is determined by first
looking at the applicable stock trading
pause trigger percentage of the security
and then reducing that number by 2%.
Since currently the stock pause trigger
percentage across all exchanges is 10%,
a CBSX Market-Maker’s quote in a such
a security may not be more than 8%
away from the national best bid or best
offer as appropriate. Once a compliant
quote is entered, it may rest without
adjustment until such time as it moves
to within 1⁄2 of 1% of the applicable
trigger pause percentage (i.e., currently
9.5%) whereupon the CBSX MarketMaker must immediately move its quote
back to at least the permissible default
level of 8% away from the national best
bid or best offer. During times in which
a trigger pause percentage is not
applicable (e.g., before 8:45 a.m. and
after 2:35 p.m. Chicago Time), a market
maker must maintain a quote no further
than 20% away from the inside (i.e., it
may rest without adjustment until it
reaches 21.5%). In the absence of
national best or best offer, the above
calculations will remain the same, but
will use the national last sale instead of
the absent bid or offer.
For securities not subject to any
individual stock pause trigger, the
proposal will a [sic] assume a
hypothetical 32% trigger pause, apply a
2% reduction, and require CBSX
Market-Makers in those issues to
maintain quotes no more than 30%
away from the national best and
national best offer. Like securities
subject to stock trading pauses, once a
compliant quote is entered, it may rest
without adjustment until such time as it
moves to within 1⁄2 of 1% of its
5 See Exchange Act Release Nos. 62252 (June 10,
2010), 75 FR 34186 (June 16, 2010) and 62886
(September 10, 2010).
E:\FR\FM\27SEN1.SGM
27SEN1
Agencies
[Federal Register Volume 75, Number 186 (Monday, September 27, 2010)]
[Notices]
[Pages 59305-59309]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-24059]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62954; File No. SR-BX-2010-066]
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing of a Proposed Rule Change To Enhance Quotation Requirements for
Market Makers
September 20, 2010.
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 17, 2010, NASDAQ OMX
[[Page 59306]]
BX, Inc. (``BX'' 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. 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.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is filing with the Commission a proposed rule change
to enhance quotation requirements for market makers. The text of the
proposed rule change is below. Proposed new language is in italics;
proposed deletions are in [brackets].\3\
---------------------------------------------------------------------------
\3\ Changes are marked to the rule text that appears in the
electronic manual of Nasdaq found at https://nasdaqomxbx.cchwallstreet.com.
---------------------------------------------------------------------------
* * * * *
[4613. Character of Quotations]
A member registered as an Equities Market Maker shall engage in a
course of dealings for its own account to assist in the maintenance,
insofar as reasonably practicable, of fair and orderly markets in
accordance with this Rule.
(a) Quotation Requirements and Obligations
(1) Two-Sided Quote Obligation. For each security in which a member
is registered as an Equities Market Maker, the member shall be willing
to buy and sell such security for its own account on a continuous basis
and shall enter and maintain a two-sided quotation (``Principal
Quote''), which is attributed to the market maker by a special market
participant identifier (``MPID'') and is displayed in the NASDAQ OMX BX
Equities Market at all times, subject to the procedures for excused
withdrawal set forth in Rule 4619.
(A) A registered Equities Market Maker must display a quotation
size for at least one normal unit of trading (or a larger multiple
thereof) when it is not displaying a limit order in compliance with SEC
Rule 604, provided, however, that a registered Equities Market Maker
may augment its displayed quotation size to display limit orders priced
at the Equities Market Maker's quotation. Unless otherwise designated,
a ``normal unit of trading'' shall be 100 shares.
(B) The minimum quotation increment for quotations of $1.00 or
above in all System Securities shall be $0.01. The minimum quotation
increment in the System for quotations below $1.00 in System Securities
shall be $0.0001.
(2) The first MPID issued to a member pursuant to subparagraph (1)
of this rule, or Rule 4623, shall be referred to as the member's
``Primary MPID.'' Market makers and ECNs may request the use of
additional MPIDs that shall be referred to as ``Supplemental MPIDs.'' A
market maker may request the use of a Supplemental MPIDs for displaying
Attributable Quotes/Orders in the Exchange's Quotation Montage for any
security in which it is registered and meets the obligations set forth
in subparagraph (1) of this rule. An ECN may request the use of
Supplemental MPIDS for displaying Attributable Quotes/Orders in the
Exchange's Quotation Montage for any security in which it meets the
obligations set forth in Rule 4623. A market maker or ECN that ceases
to meet the obligations appurtenant to its Primary MPID in any security
shall not be permitted to use a Supplemental MPID for any purpose in
that security.
(3) Market makers and ECNs that are permitted the use of
Supplemental MPIDs for displaying Attributable Quotes/Orders pursuant
to subparagraph (2) of this rule are subject to the same rules
applicable to the member's first quotation, with two exceptions: (a)
The continuous two-sided quote requirement and excused withdrawal
procedures described in subparagraph (1) above do not apply to market
maker's Supplemental MPIDs; and (b) Supplemental MPIDs may not be used
by market makers to enter stabilizing bids pursuant to Equity Rule
4614.]
4613. Market Maker Obligations
A member registered as an Equities Market Maker shall engage in a
course of dealings for its own account to assist in the maintenance,
insofar as reasonably practicable, of fair and orderly markets in
accordance with this Rule.
(a) Quotation Requirements and Obligations
(1) Two-Sided Quote Obligation. For each security in which a member
is registered as a Equities Market Maker, the member shall be willing
to buy and sell such security for its own account on a continuous basis
during regular market hours and shall enter and maintain a two-sided
trading interest (``Two-Sided Obligation'') that is identified to the
Exchange as the interest meeting the obligation and is displayed in the
Exchange's quotation montage at all times. Interest eligible to be
considered as part of an Equities Market Maker's Two-Sided Obligation
shall have a displayed quotation size of at least one normal unit of
trading (or a larger multiple thereof); provided, however, that an
Equities Market Maker may augment its Two-Sided Obligation size to
display limit orders priced at the same price as the Two-Sided
Obligation. Unless otherwise designated, a ``normal unit of trading''
shall be 100 shares. After an execution against its Two-Sided
Obligation, Equities a Market Maker must ensure that additional trading
interest exists in the Exchange to satisfy its Two-Sided Obligation
either by immediately entering new interest to comply with this
obligation to maintain continuous two-sided quotations or by
identifying existing interest on the Exchange book that will satisfy
this obligation.
(2) Pricing Obligations. For NMS stocks (as defined in Rule 600
under Regulation NMS) an Equities Market Maker shall adhere to the
pricing obligations established by this Rule during Regular Market
Hours.
(A) Bid Quotations. At the time of entry of bid interest satisfying
the Two-Sided Obligation, the price of the bid interest shall be not
more than the Designated Percentage away from the then current National
Best Bid, or if no National Best Bid, not more than the Designated
Percentage away from the last reported sale from the responsible single
plan processor. In the event that the National Best Bid (or if no
National Best Bid, the last reported sale) increases to a level that
would cause the bid interest of the Two-Sided Obligation to be more
than the Defined Limit away from the National Best Bid (or if no
National Best Bid, the last reported sale), or if the bid is executed
or cancelled, the Equities Market Maker shall enter new bid interest at
a price not more than the Designated Percentage away from the then
current National Best Bid (or if no National Best Bid, the last
reported sale), or identify to the Exchange current resting interest
that satisfies the Two-Sided Obligation.
(B) Offer Quotations.--At the time of entry of offer interest
satisfying the Two-Sided Obligation, the price of the offer interest
shall be not more than the Designated Percentage away from the then
current National Best Offer, or if no National Best Offer, not more
than the Designated Percentage away from the last reported sale
received from the responsible single plan processor. In the event that
the National Best Offer (or if no National Best Offer, the last
reported sale) decreases to a level that would cause the offer interest
of the Two-Sided Obligation to be more than the Defined
[[Page 59307]]
Limit away from the National Best Offer (or if no National Best Offer,
the last reported sale), or if the offer is executed or cancelled, the
Equities Market Maker shall enter new offer interest at a price not
more than the Designated Percentage away from the then current National
Best Offer (or if no National Best Offer, the last reported sale), or
identify to the Exchange current resting interest that satisfies the
Two-Sided Obligation.
(C) The National Best Bid and Offer shall be determined by the
Exchange in accordance with its procedures for determining protected
quotations under Rule 600 under Regulation NMS.
(D) For purposes of this Rule, the term ``Designated Percentage''
shall mean the individual stock pause trigger percentage under Rule
4120(a)(11) (or comparable rule of another exchange) less two (2)
percentage points. For times during regular market hours when stock
pause triggers are not in effect under Rule 4120(a)(11) (or comparable
rule of another exchange), the Designated Percentage calculation will
assume a trigger percentage of 22%. For NMS stocks that are not subject
to such stock pause triggers the Designated Percentage will assume a
trigger percentage of 32%.
(E) For purposes of this Rule, the term ``Defined Limit'' shall
mean the individual stock pause trigger percentage under Rule
4120(a)(11) (or comparable rule of another exchange) less one-half (\1/
2\) percentage point. For times during regular market hours when stock
pause triggers are not in effect under Rule 4120(a)(11) (or comparable
rule of another exchange), the Defined Limit calculation will assume a
trigger percentage of 22%. For NMS stocks that are not subject to such
stock pause triggers the Defined Limit calculation will assume a
trigger percentage of 32%.
(F) Quotation Creation and Adjustment. For each Issue in which an
Equities Market Maker is registered, the System shall automatically
create a quotation for display to comply with this Rule. System-created
compliant displayed quotations will thereafter be allowed to rest and
not be further adjusted by the System unless the relationship between
the quotation and its related National Best Bid or National Best Offer,
as appropriate, shrinks to the greater of: (a) 4 percentage points, or,
(b) one-quarter the applicable percentage necessary to trigger an
individual stock trading pause as described in NASDAQ OMX BX Rule
4120(a)(11), or expands to within that same percentage less 0.5%,
whereupon the System will immediately re-adjust and display the
Equities Market Maker's quote to the appropriate Designated Percentage
set forth in section (D) above. As the System allows for multiple
attributable quotations by a Equities Market Maker in an issue,
quotations originally entered by Equities Market Makers shall be
allowed to move freely towards or away from the National Best Bid or
National Best Offer, as appropriate, for potential execution.
(G) Quotation Refresh After Execution. In the event of an execution
against a System-created compliant quotation, the Equities Market Maker
shall have its quote refreshed by the System on the executed side of
the market at the applicable Designated Percentage away from the then
National Best Bid (Offer) (or if no National Best Bid (Offer), the last
reported sale).
(H) Nothing in this Rule shall preclude an Equities Market Maker
from quoting at price levels that are closer to the National Best Bid
and Offer than the levels required by this Rule.
(I) The minimum quotation increment for quotations of $1.00 or
above in all System Securities shall be $0.01. The minimum quotation
increment in the System for quotations below $1.00 in System Securities
shall be $0.0001.
(J) The individual Market Participant Identifier (``MPID'')
assigned to a member to meet its Two-Sided Obligation pursuant to
subparagraph (a)(1) of this Rule, or Rule 4623, shall be referred to as
the member's ``Primary MPID.'' Equities Market Makers and ECNs may
request the use if additional MPIDs that shall be referred to as
``Supplemental MPIDs.'' An Equities Market Maker may request the use of
Supplemental MPIDs for displaying Attributable Quotes/Orders in the
Quotation Montage for any security in which it is registered and meets
the obligations set forth in subparagraph (1) of this rule. An ECN may
request the use of Supplemental MPIDs for displaying Attributable
Quotes/Orders in the Quotation Montage for any security in which it
meets the obligations set forth in Rule 4623. An Equities Market Maker
or ECN that ceases to meet the obligations appurtenant to its Primary
MPID in any security shall not be permitted to use a Supplemental MPID
for any purpose in that security.
(K) Equities Market Makers and ECNs that are permitted the use of
Supplemental MPIDs for displaying Attributable Quotes/Orders pursuant
to subparagraph (2) of this rule are subject to the same rules
applicable to the members' first quotation, with two exceptions: (a)
The continuous two-sided quote requirement and excused withdrawal
procedures described in subparagraph (1) above do not apply to Equities
Market Makers' Supplemental MPIDs; and (b) Supplemental MPIDs may not
be used by Equities Market Makers to engage in passive market making or
to enter stabilizing bids pursuant to Rule 4614.
(b)-(e) No Change.
* * * * *
(b) Not applicable.
(c) Not applicable.
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 aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
Market Maker Quote Obligations:
The Exchange proposes to adopt rules to enhance minimum quotation
requirements for market makers. Under the proposal, the Exchange will
require market makers for each stock in which they are registered to
continuously maintain a two-sided quotation within a designated
percentage of the National Best Bid and National Best Offer as
appropriate. These enhanced market maker quotation requirements are
intended to eliminate trade executions against market maker placeholder
quotations traditionally priced far away from the inside market,
commonly known as ``stub quotes.'' They are also intended to augment
and work in relation to the single stock pause standards already in
place on a pilot basis for stocks in the S&P 500, Russell 1000, and
specified ETFs.\4\ Under the proposal, the Exchange will require
registered market makers to enter and maintain quotes priced at no more
than a certain percentage away from the national inside bid and offer.
Permissible quotes are determined by the individual character of the
security, the time of day in which the quote is entered, and other
factors which are summarized below:
---------------------------------------------------------------------------
\4\ See Exchange Act Release No. 62884 (September 10, 2010).
---------------------------------------------------------------------------
[[Page 59308]]
For issues subject to an individual stock trading trigger pause, a
permissible quote is determined by first looking at the applicable
stock trading pause trigger percentage of the security and then
reducing that number by 2%. Since currently the stock pause trigger
percentage across all exchanges is 10%, a market maker's quote in such
a security may not be more than 8% away from the national best bid or
best offer as appropriate. Once a compliant quote is entered, it may
rest without adjustment until such time as it moves to within \1/2\ of
1% of the applicable trigger pause percentage (i.e., currently 9.5%)
whereupon the market maker must immediately move its quote back to at
least the permissible default level of 8% away from the national best
bid or best offer. During times in which a trigger pause percentage is
not applicable (e.g. before 9:45 a.m. and after 3:35 p.m.), a market
maker must maintain a quote no further than 20% away from the inside
(i.e. it may rest without adjustment until it reaches 21.5%). In the
absence of national best or best offer, the above calculations will
remain the same, but will use the national last sale instead of the
absent bid or offer.
For securities not subject to any individual stock pause trigger,
the proposal will a [sic] assume a hypothetical 32% trigger pause,
apply a 2% reduction, and require market makers in those issues to
maintain quotes no more than 30% away from the national best and
national best offer. Like securities subject to stock trading pauses,
once a compliant quote is entered, it may rest without adjustment until
such time as it moves to within \1/2\ of 1% of its applicable trigger
pause percentage (31.5%) whereupon the market maker must immediately
move its quote back to at least the permissible default level of 30%.
These requirements shall apply to Regulation NMS securities during
normal market hours.
Nothing in the above precludes a market maker from voluntarily
quoting at price levels that are closer to the national best bid and
best offer than required under the proposal.
Automated Quote Management:
In order to assist market makers in meeting their enhanced
quotation obligations, the Exchange will also provide automated quote
management functionality. For each issue in which a market maker is
registered, the Exchange will automatically create a quotation for
display to comply with this standard set forth in this proposal.
Compliant displayed quotations will thereafter be allowed to rest and
not be further adjusted by the Exchange unless the relationship between
the quotation and its related national best bid or national best offer,
as appropriate, shrinks to the greater of: (a) 4 percentage points, or,
(b) one-quarter the applicable percentage necessary to trigger an
individual stock trading pause as described in NASDAQ OMX BX Rule
4120(a)(11), or expands to within that same percentage less 0.5%,
whereupon the Exchange will immediately re-adjust and display the
market maker's quote to the appropriate designated percentage.
Quotations originally entered by market makers shall be allowed to move
freely towards the national best bid or national best offer, as
appropriate, for potential execution.
In the event of an execution against a System-created compliant
quotation, the market maker shall have its quote refreshed by the
System on the executed side of the market at the applicable designated
percentage away from the then national best bid (offer), or if no
national best bid (offer), the last reported sale.
Previously Approved Rule Text:
Finally, the sections (I), (J) and (K) of the proposed rule are
portions of previously approved text of Rule 4613 that have moved so as
to group the proposed market making standard sections together within
the rule.
2. Statutory Basis
The statutory basis for the proposed rule change is Section 6(b)(5)
of the Securities Exchange Act of 1934 (the ``Act''),\5\ which requires
the rules of an exchange 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, in general, to protect
investors and the public interest. The proposed rule change also is
designed to support the principles of Section 11A(a)(1) \6\ of the Act
in that it seeks to assure fair competition among brokers and dealers
and among exchange markets. The Exchange believes that the proposed
rule meets these requirements in that it promotes transparency and
uniformity across markets concerning minimum market maker quotation
requirements.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78f(b)(5).
\6\ 15 U.S.C. 78k-1(a)(1).
---------------------------------------------------------------------------
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, as amended.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the Exchange consents, the Commission shall: (a) By order approve
or disapprove such proposed rule change, or (b) institute proceedings
to determine whether the proposed rule change should be 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 e-mail to rule-comments@sec.gov. Please include
File Number SR-BX-2010-066 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-BX-2010-066. 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
[[Page 59309]]
provisions of 5 U.S.C. 552, will be available for inspection and
copying in the Commission's Public Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of such 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 publicly available. All
submissions should refer to File Number SR-BX-2010-066 and should be
submitted on or before October 18, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\7\
---------------------------------------------------------------------------
\7\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-24059 Filed 9-24-10; 8:45 am]
BILLING CODE 8010-01-P