Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change To Amend Rule 6.47 To Describe New Procedures for Executing a Cross Transaction, 66407-66408 [2010-27266]
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Federal Register / Vol. 75, No. 208 / Thursday, October 28, 2010 / Notices
Number SR–EDGA–2010–15 on the
subject line.
SECURITIES AND EXCHANGE
COMMISSION
Paper Comments
[Release No. 34–63166; File No. SR–
NYSEArca–2010–90]
• 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–EDGA–2010–15. 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 website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission,11 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, 100 F Street, NE.,
Washington, DC 20549, 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–EDGA–
2010–15 and should be submitted on or
before November 18, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–27243 Filed 10–27–10; 8:45 am]
emcdonald on DSK2BSOYB1PROD with NOTICES
BILLING CODE 8011–01–P
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing of Proposed
Rule Change To Amend Rule 6.47 To
Describe New Procedures for
Executing a Cross Transaction
October 22, 2010.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on October
21, 2010, NYSE Arca, Inc. (the
‘‘Exchange’’ or ‘‘NYSE Arca’’) 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 self-regulatory
organization. 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
Rule 6.47 to describe new procedures
for executing a cross transaction. The
text of the proposed rule change is
available at the Exchange, the
Commission’s Public Reference Room,
and https://www.nyse.com.
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
11 The text of the proposed rule change is
available on Exchange’s Web site at https://
www.directedge.com, on the Commission’s Web site
at https://www.sec.gov, at EDGA, and at the
Commission’s Public Reference Room.
12 17 CFR 200.30–3(a)(12).
VerDate Mar<15>2010
16:13 Oct 27, 2010
Jkt 223001
NYSE Arca proposes to modify Rule
6.47(a) to describe new procedures for
Floor Brokers wishing to execute a NonU.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
66407
Facilitation cross transaction.4
Currently, after requesting a market,
Floor Brokers are required to disclose
the terms of a cross, after which Market
Makers are allowed to revise their bids
and offers to block the cross.
NYSE Arca proposes that Market
Makers, after being informed of a
potential cross, should provide their
best bid and best offer, but not be
allowed to step ahead of subsequently
disclosed trading interest. The Exchange
intends for Market Makers to make
markets and not prevent better priced
trading interests from interacting with
each other.
The proposed rule change would
allow a Floor Broker to request, after
revealing the size of the orders, a final
quote for a cross from the Trading
Crowd, and then to cross above the
highest bid, or below the lowest offer,
and, if not on a price provided by the
Crowd, to execute the cross in its
entirety. If the cross were to take place
on the price provided by the Crowd, the
Floor Broker would be obligated to trade
with that interest prior to crossing the
orders. The cross would be required to
be within the National Best Bid/Offer,
and would also be obligated to satisfy
any bids or offers in the Consolidated
Book equal to or better than the crossing
price.
For example, if the prices of the
orders to be crossed allowed for a range
of possible crossing prices, and the
Trading Crowd provided a final quote
that was two or more Minimum Price
Variations (‘‘MPV’’) wide, the Floor
Broker could bid above the Trading
Crowd’s bid and consummate the cross
without trading on a final quote price.
If, alternatively, the final quote was
only one MPV wide, (i.e., 3.10 bid for
20 contracts at 3.20 offer for 50
contracts) the Floor Broker could not
meet the obligation to the orders
without trading on a final quote price.
In this case, the Floor Broker would bid
above the final quote bid (i.e., bid 3.20)
or offer below the final quote offer (i.e.,
offer at 3.10), each instance of which is
equal to a final quote price. The Floor
Broker would then be obligated to trade
with the final quote interest at that price
(i.e., buy 50 at 3.20 or sell 20 at 3.10)
before crossing the balance of the
orders.
Additionally, if, because of movement
in the markets while the order was
being brought to the crowd, the limit on
one of the orders only allowed for a
cross to be effected at a final quote
price, regardless of the width of the final
quote, the Floor Broker would be
1 15
2 15
PO 00000
Frm 00061
Fmt 4703
4 Facilitation Crosses are governed by Rule
6.47(b), and are not affected by this proposal.
Sfmt 4703
E:\FR\FM\28OCN1.SGM
28OCN1
66408
Federal Register / Vol. 75, No. 208 / Thursday, October 28, 2010 / Notices
required to bid above the final quote bid
or offer below the final quote offer yet
still be at a final quote price. Again, the
Floor Broker would be obligated to trade
with the final quote interest at that price
before crossing the balance of the
orders. For instance, the electronic
market in the series is 3.00 bid offered
at 3.30, and the Floor Broker receives
orders to cross at 3.10 or 3.20. When the
Floor Broker requests a Final Quote, the
crowd responds with a market of 3.20
bid at 3.30. In order to meet the
obligation to execute the order, the
Floor Broker would have to offer at 3.20,
fill the bids in the crowd at 3.20, and
then cross the balance of the orders.
Additionally, the Exchange proposes
to add two commentaries to Rule 6.47.
Commentary .02 would allow an OTP
Holder to submit an order that has been
solicited prior to transmittal to the
Floor, but would not allow the new
procedures to be used to circumvent
limitations on principal transactions as
described in Rule 6.47A, nor allow the
OTP Holder to solicit a contra order
from an NYSE Arca Market Maker
assigned to the class of options to trade
against an agency order.
Commentary .03 would state it is a
violation of a Floor Broker’s duty for
best execution to cancel an agency order
to avoid execution at a better price.
2. Statutory Basis
emcdonald on DSK2BSOYB1PROD with NOTICES
The Exchange believes the proposed
rule change is consistent with and
furthers the objectives of Section 6(b)(5)
of the Act, in that it is designed to
promote just and equitable principles of
trade, remove impediments to and
perfect the mechanisms 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 will provide
encouragement for Market Makers to
provide their best prices earlier, upon
the initial presentation of trading
interest to the crowd, and the broker
will be required to better the crowd’s
price in order to execute the cross
transaction. The proposed new process
should thus increase the possibility of
price improvement for Customer orders.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.
VerDate Mar<15>2010
16:13 Oct 27, 2010
Jkt 223001
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of
publication of this notice in the Federal
Register or within such longer period
up to 90 days (i) as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or (ii) as to which
the self-regulatory organization
consents, the Commission will:
(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:
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official
business days between the hours of 10
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.5 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–
NYSEArca–2010–90 and should be
submitted on or before November 18,
2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.6
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–27266 Filed 10–27–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
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–NYSEArca–2010–90 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–NYSEArca–2010–90. 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
PO 00000
Frm 00062
Fmt 4703
Sfmt 4703
[Release No. 34–63163; File No. SR–EDGX–
2010–14]
Self-Regulatory Organizations; EDGX
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend EDGX Rule
11.5
October 22, 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
20, 2010, the EDGX Exchange, Inc. (the
‘‘Exchange’’ or the ‘‘EDGX’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which items have
been prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
5 The text of the proposed rule change is available
on the Commission’s Web site at www.sec.gov.
6 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
E:\FR\FM\28OCN1.SGM
28OCN1
Agencies
[Federal Register Volume 75, Number 208 (Thursday, October 28, 2010)]
[Notices]
[Pages 66407-66408]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-27266]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63166; File No. SR-NYSEArca-2010-90]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change To Amend Rule 6.47 To Describe New Procedures
for Executing a Cross Transaction
October 22, 2010.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on October 21, 2010, NYSE Arca, Inc. (the ``Exchange'' or
``NYSE Arca'') 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 self-regulatory
organization. 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\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Rule 6.47 to describe new procedures
for executing a cross transaction. The text of the proposed rule change
is available at the Exchange, the Commission's Public Reference Room,
and https://www.nyse.com.
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
NYSE Arca proposes to modify Rule 6.47(a) to describe new
procedures for Floor Brokers wishing to execute a Non-Facilitation
cross transaction.\4\ Currently, after requesting a market, Floor
Brokers are required to disclose the terms of a cross, after which
Market Makers are allowed to revise their bids and offers to block the
cross.
---------------------------------------------------------------------------
\4\ Facilitation Crosses are governed by Rule 6.47(b), and are
not affected by this proposal.
---------------------------------------------------------------------------
NYSE Arca proposes that Market Makers, after being informed of a
potential cross, should provide their best bid and best offer, but not
be allowed to step ahead of subsequently disclosed trading interest.
The Exchange intends for Market Makers to make markets and not prevent
better priced trading interests from interacting with each other.
The proposed rule change would allow a Floor Broker to request,
after revealing the size of the orders, a final quote for a cross from
the Trading Crowd, and then to cross above the highest bid, or below
the lowest offer, and, if not on a price provided by the Crowd, to
execute the cross in its entirety. If the cross were to take place on
the price provided by the Crowd, the Floor Broker would be obligated to
trade with that interest prior to crossing the orders. The cross would
be required to be within the National Best Bid/Offer, and would also be
obligated to satisfy any bids or offers in the Consolidated Book equal
to or better than the crossing price.
For example, if the prices of the orders to be crossed allowed for
a range of possible crossing prices, and the Trading Crowd provided a
final quote that was two or more Minimum Price Variations (``MPV'')
wide, the Floor Broker could bid above the Trading Crowd's bid and
consummate the cross without trading on a final quote price.
If, alternatively, the final quote was only one MPV wide, (i.e.,
3.10 bid for 20 contracts at 3.20 offer for 50 contracts) the Floor
Broker could not meet the obligation to the orders without trading on a
final quote price. In this case, the Floor Broker would bid above the
final quote bid (i.e., bid 3.20) or offer below the final quote offer
(i.e., offer at 3.10), each instance of which is equal to a final quote
price. The Floor Broker would then be obligated to trade with the final
quote interest at that price (i.e., buy 50 at 3.20 or sell 20 at 3.10)
before crossing the balance of the orders.
Additionally, if, because of movement in the markets while the
order was being brought to the crowd, the limit on one of the orders
only allowed for a cross to be effected at a final quote price,
regardless of the width of the final quote, the Floor Broker would be
[[Page 66408]]
required to bid above the final quote bid or offer below the final
quote offer yet still be at a final quote price. Again, the Floor
Broker would be obligated to trade with the final quote interest at
that price before crossing the balance of the orders. For instance, the
electronic market in the series is 3.00 bid offered at 3.30, and the
Floor Broker receives orders to cross at 3.10 or 3.20. When the Floor
Broker requests a Final Quote, the crowd responds with a market of 3.20
bid at 3.30. In order to meet the obligation to execute the order, the
Floor Broker would have to offer at 3.20, fill the bids in the crowd at
3.20, and then cross the balance of the orders.
Additionally, the Exchange proposes to add two commentaries to Rule
6.47. Commentary .02 would allow an OTP Holder to submit an order that
has been solicited prior to transmittal to the Floor, but would not
allow the new procedures to be used to circumvent limitations on
principal transactions as described in Rule 6.47A, nor allow the OTP
Holder to solicit a contra order from an NYSE Arca Market Maker
assigned to the class of options to trade against an agency order.
Commentary .03 would state it is a violation of a Floor Broker's
duty for best execution to cancel an agency order to avoid execution at
a better price.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
and furthers the objectives of Section 6(b)(5) of the Act, in that it
is designed to promote just and equitable principles of trade, remove
impediments to and perfect the mechanisms 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 will provide encouragement
for Market Makers to provide their best prices earlier, upon the
initial presentation of trading interest to the crowd, and the broker
will be required to better the crowd's price in order to execute the
cross transaction. The proposed new process should thus increase the
possibility of price improvement for Customer orders.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(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-NYSEArca-2010-90 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-NYSEArca-2010-90. 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 Web site
viewing and printing in the Commission's Public Reference Room, 100 F
Street, NE., Washington, DC 20549, on official business days between
the hours of 10 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.\5\ 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-
NYSEArca-2010-90 and should be submitted on or before November 18,
2010.
---------------------------------------------------------------------------
\5\ The text of the proposed rule change is available on the
Commission's Web site at www.sec.gov.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\6\
---------------------------------------------------------------------------
\6\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-27266 Filed 10-27-10; 8:45 am]
BILLING CODE 8011-01-P