Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 11.13, entitled “Order Execution”, 66172-66173 [2010-27143]

Download as PDF 66172 Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Notices 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,12 all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 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–2010–030 and should be submitted on or before November 17, 2010. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–27141 Filed 10–26–10; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–63148; File No. SR–BYX– 2010–003] Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 11.13, entitled ‘‘Order Execution’’ srobinson on DSKHWCL6B1PROD with NOTICES October 21, 2010. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on October 13, 2010, BATS Y-Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BYX’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I and II 12 The text of the proposed rule change is available on the Commission’s Web site at https:// www.sec.gov/rules/sro.shtml. 13 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. VerDate Mar<15>2010 17:00 Oct 26, 2010 Jkt 223001 below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend BATS Rule 11.13 [sic],3 entitled ‘‘Order Execution,’’ to modify the description of certain routing strategies that the Exchange proposes to offer when it commences operations. 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 the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Rule 11.13, which describes its order routing processes, to modify the description of certain routing strategies that the Exchange proposes to offer when it commences operations. Recently, the Exchange proposed addition of reference in its Rules to various routing strategies that will be available through BYX based on the rules of its affiliate, BATS Exchange, Inc. (‘‘BATS Exchange’’). Such strategies include the CYCLE routing strategy, variations of the Parallel routing strategy, DRT routing and Destination Specific Routing. The Exchange proposes to further amend Rule 11.13 to offer two new routing strategies, which are described below. • TRIM. TRIM is a routing option under which an order will check the System for available shares and then will be sent to destinations on the System routing table. • SLIM. SLIM is a routing option under which an order will check the System for available shares and then will be sent to destinations on the 3 The Commission notes that the Exchange proposes to amend BYX Rule 11.13. PO 00000 Frm 00113 Fmt 4703 Sfmt 4703 System routing table, including BATS Exchange. In addition to the addition of the TRIM and SLIM routing strategies, the Exchange proposes modifying the description of the Parallel T routing strategy to make clear that when checking the Exchange’s System for available shares, it will only check for displayed shares prior to routing away from the Exchange. The Parallel T routing strategy is intended to route only to Protected Quotations and only for displayed size, and thus, the Exchange believes that removal of only displayed size from its own System is most consistent with this strategy. Exchange Rule 11.13(a)(3)(E) includes a definition of DRT routing, which is a routing option in which the entering firm instructs the System to route to alternative trading systems included in the System routing table. The definition of DRT currently states that it can be combined with three specified routing strategies offered by the Exchange. The Exchange proposes modifying the description of DRT routing to make clear that it can be combined with all routing strategies, including the new TRIM and SLIM routing strategies, unless otherwise specified. In addition, because some routing strategies offered by the Exchange might include DRT routing at a later stage, the Exchange proposes to remove the word ‘‘first’’ from the definition of the DRT routing strategy. 2. Statutory Basis The rule change proposed in this submission 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) of the Act.4 Specifically, the proposed change is consistent with Section 6(b)(5) of the Act,5 because it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments to, and perfect the mechanism of, a free and open market and a national market system. The proposed change to introduce additional routing strategies will provide market participants with greater flexibility in routing orders consistent with Regulation NMS without developing complicated order routing strategies on their own. 4 15 5 15 E:\FR\FM\27OCN1.SGM U.S.C. 78f(b). U.S.C. 78f(b)(5). 27OCN1 Federal Register / Vol. 75, No. 207 / Wednesday, October 27, 2010 / Notices 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 The Exchange has neither solicited nor received written comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative 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 6 and Rule 19b– 4(f)(6) thereunder.7 A proposed rule change filed pursuant to Rule 19b–4(f)(6) under the Act 8 normally does not become operative for 30 days after the date of its filing. However, Rule 19b–4(f)(6) 9 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange requests that the Commission waive the 30-day operative delay in order to allow the Exchange to immediately offer Exchange Users the routing strategies when BYX, commences operations. Further, the Exchange believes that the proposed TRIM and SLIM routing strategies are consistent with routing strategies offered by the Nasdaq Stock Market (‘‘NASDAQ’’).10 In addition, the Exchange believes that its proposed new routing strategies will benefit market participants and their customers by allowing them greater flexibility in their efforts to fill orders and minimize trading costs. The Exchange expects to have technological changes for one or more of the new routing strategies in place to support the proposed rule change in the near future, and believes that benefits to Exchange Users srobinson on DSKHWCL6B1PROD with NOTICES 6 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6) requires a self-regulatory organization to give 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. BYX has satisfied this requirement. 8 17 CFR 240.19b–4(f)(6). 9 Id. 10 See NASDAQ Rule 4758. 7 17 VerDate Mar<15>2010 17:00 Oct 26, 2010 Jkt 223001 expected from the proposed rule change should not be delayed. In addition, BYX states a delay to the implementation date would put the Exchange at a competitive disadvantage to other markets that already offer similar functionalities. The Commission believes that waiving the 30-day operative delay 11 is consistent with the protection of investors and the public interest and designates the proposal operative upon filing. 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–BYX–2010–003 on the subject line. 66173 proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 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–BYX–2010–003 and should be submitted on or before November 17, 2010. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–27143 Filed 10–26–10; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–63150; File No. SR–FINRA– 2009–058] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing of Paper Comments Amendment No. 1 to a Proposed Rule Change and Order Granting • Send paper comments in triplicate Accelerated Approval of Proposed to Elizabeth M. Murphy, Secretary, Rule Change, as Modified by Securities and Exchange Commission, Amendment No. 1, To Adopt FINRA 100 F Street, NE., Washington, DC Rule 2232 (Customer Confirmations) in 20549–1090. the Consolidated FINRA Rulebook and All submissions should refer to File To Delete NASD Rule 2230, NASD IM– Number SR–BYX–2010–003. This file 2110–6 and Incorporated NYSE Rule number should be included on the subject line if e-mail is used. To help the 409(f) Commission process and review your October 21, 2010. comments more efficiently, please use only one method. The Commission will I. Introduction post all comments on the Commission’s On August 24, 2009, the Financial Internet Web site (https://www.sec.gov/ Industry Regulatory Authority, Inc. rules/sro.shtml). Copies of the (‘‘FINRA’’) (f/k/a National Association of submission,12 all subsequent Securities Dealers, Inc. (‘‘NASD’’)) filed amendments, all written statements with the Securities and Exchange with respect to the proposed rule Commission (‘‘SEC’’ or ‘‘Commission’’), change that are filed with the pursuant to Section 19(b)(1) of the Commission, and all written Securities Exchange Act of 1934 communications relating to the (‘‘Exchange Act’’ or ‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule 11 For purposes only of waiving the 30-day change to adopt FINRA Rule 2232 operative delay, the Commission has considered the (Customer Confirmations) in the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 12 The text of the proposed rule change is available on the Commission’s Web site at https:// www.sec.gov/rules/sro.shtml. PO 00000 Frm 00114 Fmt 4703 Sfmt 4703 13 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\27OCN1.SGM 27OCN1

Agencies

[Federal Register Volume 75, Number 207 (Wednesday, October 27, 2010)]
[Notices]
[Pages 66172-66173]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-27143]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-63148; File No. SR-BYX-2010-003]


Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Amend 
Rule 11.13, entitled ``Order Execution''

October 21, 2010.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on October 13, 2010, BATS Y-Exchange, Inc. (the ``Exchange'' or 
``BYX'') filed with the Securities and Exchange Commission (the 
``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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend BATS Rule 11.13 [sic],\3\ entitled 
``Order Execution,'' to modify the description of certain routing 
strategies that the Exchange proposes to offer when it commences 
operations.
---------------------------------------------------------------------------

    \3\ The Commission notes that the Exchange proposes to amend BYX 
Rule 11.13.
---------------------------------------------------------------------------

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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend Rule 11.13, which describes its 
order routing processes, to modify the description of certain routing 
strategies that the Exchange proposes to offer when it commences 
operations.
    Recently, the Exchange proposed addition of reference in its Rules 
to various routing strategies that will be available through BYX based 
on the rules of its affiliate, BATS Exchange, Inc. (``BATS Exchange''). 
Such strategies include the CYCLE routing strategy, variations of the 
Parallel routing strategy, DRT routing and Destination Specific 
Routing. The Exchange proposes to further amend Rule 11.13 to offer two 
new routing strategies, which are described below.
     TRIM. TRIM is a routing option under which an order will 
check the System for available shares and then will be sent to 
destinations on the System routing table.
     SLIM. SLIM is a routing option under which an order will 
check the System for available shares and then will be sent to 
destinations on the System routing table, including BATS Exchange.
    In addition to the addition of the TRIM and SLIM routing 
strategies, the Exchange proposes modifying the description of the 
Parallel T routing strategy to make clear that when checking the 
Exchange's System for available shares, it will only check for 
displayed shares prior to routing away from the Exchange. The Parallel 
T routing strategy is intended to route only to Protected Quotations 
and only for displayed size, and thus, the Exchange believes that 
removal of only displayed size from its own System is most consistent 
with this strategy.
    Exchange Rule 11.13(a)(3)(E) includes a definition of DRT routing, 
which is a routing option in which the entering firm instructs the 
System to route to alternative trading systems included in the System 
routing table. The definition of DRT currently states that it can be 
combined with three specified routing strategies offered by the 
Exchange. The Exchange proposes modifying the description of DRT 
routing to make clear that it can be combined with all routing 
strategies, including the new TRIM and SLIM routing strategies, unless 
otherwise specified. In addition, because some routing strategies 
offered by the Exchange might include DRT routing at a later stage, the 
Exchange proposes to remove the word ``first'' from the definition of 
the DRT routing strategy.
2. Statutory Basis
    The rule change proposed in this submission 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) of the Act.\4\ Specifically, the 
proposed change is consistent with Section 6(b)(5) of the Act,\5\ 
because it is designed to prevent fraudulent and manipulative acts and 
practices, to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in facilitating 
transactions in securities, and to remove impediments to, and perfect 
the mechanism of, a free and open market and a national market system. 
The proposed change to introduce additional routing strategies will 
provide market participants with greater flexibility in routing orders 
consistent with Regulation NMS without developing complicated order 
routing strategies on their own.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(5).

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[[Page 66173]]

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

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative 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 \6\ and Rule 19b-
4(f)(6) thereunder.\7\
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    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give 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. 
BYX has satisfied this requirement.
---------------------------------------------------------------------------

    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \8\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6) \9\ permits the Commission to 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange requests 
that the Commission waive the 30-day operative delay in order to allow 
the Exchange to immediately offer Exchange Users the routing strategies 
when BYX, commences operations. Further, the Exchange believes that the 
proposed TRIM and SLIM routing strategies are consistent with routing 
strategies offered by the Nasdaq Stock Market (``NASDAQ'').\10\ In 
addition, the Exchange believes that its proposed new routing 
strategies will benefit market participants and their customers by 
allowing them greater flexibility in their efforts to fill orders and 
minimize trading costs. The Exchange expects to have technological 
changes for one or more of the new routing strategies in place to 
support the proposed rule change in the near future, and believes that 
benefits to Exchange Users expected from the proposed rule change 
should not be delayed. In addition, BYX states a delay to the 
implementation date would put the Exchange at a competitive 
disadvantage to other markets that already offer similar 
functionalities. The Commission believes that waiving the 30-day 
operative delay \11\ is consistent with the protection of investors and 
the public interest and designates the proposal operative upon filing.
---------------------------------------------------------------------------

    \8\ 17 CFR 240.19b-4(f)(6).
    \9\ Id.
    \10\ See NASDAQ Rule 4758.
    \11\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    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 rule-comments@sec.gov. Please include 
File Number SR-BYX-2010-003 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.

All submissions should refer to File Number SR-BYX-2010-003. 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,\12\ all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for Web site 
viewing and printing in the Commission's Public Reference Room, 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-BYX-2010-003 and should be submitted on or before 
November 17, 2010.
---------------------------------------------------------------------------

    \12\ The text of the proposed rule change is available on the 
Commission's Web site at https://www.sec.gov/rules/sro.shtml.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-27143 Filed 10-26-10; 8:45 am]
BILLING CODE 8011-01-P
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