Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend Pilot Program Related To Clearly Erroneous Execution Reviews, 78327-78328 [2010-31450]

Download as PDF Federal Register / Vol. 75, No. 240 / Wednesday, December 15, 2010 / Notices IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change, as modified by Amendment No. 1, 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–Phlx–2010–157 on the subject line. Paper Comments For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.50 Florence E. Harmon, Deputy Secretary. 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. [FR Doc. 2010–31487 Filed 12–14–10; 8:45 am] A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–63488; File No. SR–BATS– 2010–036] Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend Pilot Program Related To Clearly Erroneous Execution Reviews December 9, 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 December 2, 2010, BATS Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BATS’’) filed with the Securities and Exchange Commission All submissions should refer to File (‘‘Commission’’) the proposed rule Number SR–Phlx–2010–157. This file change as described in Items I and II number should be included on the subject line if e-mail is used. To help the below, which Items have been prepared by the Exchange. The Commission is Commission process and review your publishing this notice to solicit comments more efficiently, please use only one method. The Commission will comments on the proposed rule change post all comments on the Commission’s from interested persons. Internet Web site (https://www.sec.gov/ I. Self-Regulatory Organization’s rules/sro.shtml). Copies of the Statement of the Terms of Substance of submission, all subsequent the Proposed Rule Change amendments, all written statements The Exchange is filing with the with respect to the proposed rule Commission a proposal to extend a pilot change that are filed with the program previously approved by the Commission, and all written Commission related to Rule 11.17, communications relating to the entitled ‘‘Clearly Erroneous Executions.’’ proposed rule change between the The Exchange proposes to extend both Commission and any person, other than pilot programs through April 11, 2011. those that may be withheld from the The text of the proposed rule change public in accordance with the is available at the Exchange’s Web site provisions of 5 U.S.C. 552, will be at https://www.batstrading.com, at the available for website viewing and principal office of the Exchange, and at printing in the Commission’s Public the Commission’s Public Reference Reference Room, 100 F Street, NE., Room. Washington, DC 20549, on official II. Self-Regulatory Organization’s business days between the hours of 10 Statement of the Purpose of, and a.m. and 3 p.m. Copies of such filing Statutory Basis for, the Proposed Rule also will be available for inspection and Change copying at the principal office of the In its filing with the Commission, the Exchange. All comments received will Exchange included statements be posted without change; the concerning the purpose of and basis for Commission does not edit personal the proposed rule change and discussed identifying information from any comments it received on the submissions. You should submit only proposed rule change. The text of these information that you wish to make statements may be examined at the available publicly. All submissions should refer to File Number SR–Phlx– 50 17 CFR 200.30–3(a)(12). 2010–157 and should be submitted on 1 15 U.S.C. 78s(b)(1). or before January 5, 2011. 2 17 CFR 240.19b–4. hsrobinson on DSK69SOYB1PROD with NOTICES • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. VerDate Mar<15>2010 19:10 Dec 14, 2010 Jkt 223001 78327 PO 00000 Frm 00125 Fmt 4703 Sfmt 4703 1. Purpose The purpose of this filing is to extend the effectiveness of the Exchange’s current rule applicable to Clearly Erroneous Executions, Rule 11.17. The rule, explained in further detail below, was approved to operate under a pilot program set to expire on December 10, 2010. The Exchange proposes to extend the pilot program to April 11, 2011. On September 10, 2010, the Commission approved, on a pilot basis, changes to BATS Rule 11.17 to provide for uniform treatment: (1) Of clearly erroneous execution reviews in multistock events involving twenty or more securities; and (2) in the event transactions occur that result in the issuance of an individual stock trading pause by the primary market and subsequent transactions that occur before the trading pause is in effect on the Exchange.3 The Exchange also adopted additional changes to Rule 11.17 that reduced the ability of the Exchange to deviate from the objective standards set forth in Rule 11.17.4 The Exchange believes the benefits to market participants from the more objective clearly erroneous executions rule should be approved to continue on a pilot basis. 2. Statutory Basis The Exchange believes that its proposal is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b) of the Act.5 In particular, the proposal is consistent with Section 6(b)(5) of the Act,6 because it would promote just and equitable principles of trade, remove impediments to, and perfect the mechanism of, a free and open market and a national market system. The Exchange believes that the pilot program promotes just and equitable principles of trade in that it promotes transparency and uniformity across 3 Securities Exchange Act Release No. 62886 (September 10, 2010), 75 FR 56613 (September 16, 2010) (SR–BATS–2010–016). 4 Id. 5 15 U.S.C. 78f(b). 6 15 U.S.C. 78f(b)(5). E:\FR\FM\15DEN1.SGM 15DEN1 78328 Federal Register / Vol. 75, No. 240 / Wednesday, December 15, 2010 / Notices markets concerning review of transactions as clearly erroneous. 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. U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6)(iii). In addition, Rule 19b–4(f)(6)(iii) requires that a self-regulatory organization submit to the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the filing of the proposed rule change, or such shorter time as designated by the Commission. The Commission notes that the Exchange has satisfied this requirement. 9 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). hsrobinson on DSK69SOYB1PROD with NOTICES 8 17 VerDate Mar<15>2010 19:10 Dec 14, 2010 Jkt 223001 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 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 7 and Rule 19b– 4(f)(6)(iii) thereunder.8 The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because such waiver will allow the pilot program to continue uninterrupted and help ensure uniformity among the national securities exchanges and FINRA with respect to the treatment of clearly erroneous transactions.9 Accordingly, the Commission waives the 30-day operative delay requirement and designates the proposed rule change as operative upon filing with the Commission. 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 7 15 public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–BATS–2010–036 on the subject line. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.10 Florence E. Harmon, Deputy Secretary. [FR Doc. 2010–31450 Filed 12–14–10; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–63486; File No. SR–BYX– 2010–006] Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend Pilot Program Related to Clearly Erroneous Execution Reviews December 9, 2010. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the • Send paper comments in triplicate ‘‘Act’’),1 and Rule 19b–4 thereunder,2 to Elizabeth M. Murphy, Secretary, notice is hereby given that on December Securities and Exchange Commission, 2, 2010, BATS Y-Exchange, Inc. (the 100 F Street, NE., Washington, DC ‘‘Exchange’’ or ‘‘BYX’’) filed with the 20549–1090. Securities and Exchange Commission (‘‘Commission’’) the proposed rule All submissions should refer to File change as described in Items I and II Number SR–BATS–2010–036. This file below, which Items have been prepared number should be included on the subject line if e-mail is used. To help the by the Exchange. The Commission is publishing this notice to solicit Commission process and review your comments on the proposed rule change comments more efficiently, please use only one method. The Commission will from interested persons. post all comments on the Commission’s I. Self-Regulatory Organization’s Internet Web site (https://www.sec.gov/ Statement of the Terms of Substance of rules/sro.shtml). Copies of the the Proposed Rule Change submission, all subsequent The Exchange is filing with the amendments, all written statements Commission a proposal to extend a pilot with respect to the proposed rule program related to Rule 11.17, entitled change that are filed with the ‘‘Clearly Erroneous Executions.’’ The Commission, and all written Exchange proposes to extend the pilot communications relating to the program through April 11, 2011. proposed rule change between the The text of the proposed rule change Commission and any person, other than is available at the Exchange’s Web site those that may be withheld from the at https://www.batstrading.com, at the public in accordance with the principal office of the Exchange, and at provisions of 5 U.S.C. 552, will be the Commission’s Public Reference available for Web site viewing and Room. printing in the Commission’s Public Reference Room, 100 F Street, NE., II. Self-Regulatory Organization’s Washington, DC 20549, on official Statement of the Purpose of, and business days between the hours of Statutory Basis for, the Proposed Rule 10 a.m. and 3 p.m. Copies of such filing Change also will be available for inspection and In its filing with the Commission, the copying at the principal office of the Exchange included statements Exchange. All comments received will concerning the purpose of and basis for be posted without change; the the proposed rule change and discussed Commission does not edit personal any comments it received on the identifying information from proposed rule change. The text of these submissions. You should submit only statements may be examined at the information that you wish to make places specified in Item IV below. The publicly available. All submissions should refer to File Number SR–BATS– 10 17 CFR 200.30–3(a)(12). 2010–036 and should be submitted on 1 15 U.S.C. 78s(b)(1). or before January 5, 2011. 2 17 CFR 240.19b–4. Paper Comments PO 00000 Frm 00126 Fmt 4703 Sfmt 4703 E:\FR\FM\15DEN1.SGM 15DEN1

Agencies

[Federal Register Volume 75, Number 240 (Wednesday, December 15, 2010)]
[Notices]
[Pages 78327-78328]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-31450]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-63488; File No. SR-BATS-2010-036]


Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Extend 
Pilot Program Related To Clearly Erroneous Execution Reviews

December 9, 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 December 2, 2010, BATS Exchange, Inc. (the ``Exchange'' or 
``BATS'') 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.
---------------------------------------------------------------------------

    \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 is filing with the Commission a proposal to extend a 
pilot program previously approved by the Commission related to Rule 
11.17, entitled ``Clearly Erroneous Executions.'' The Exchange proposes 
to extend both pilot programs through April 11, 2011.
    The text of the proposed rule change is available at the Exchange's 
Web site at https://www.batstrading.com, at the principal office of the 
Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
Sections A, B, and C below, of the most significant parts of such 
statements.

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

1. Purpose
    The purpose of this filing is to extend the effectiveness of the 
Exchange's current rule applicable to Clearly Erroneous Executions, 
Rule 11.17. The rule, explained in further detail below, was approved 
to operate under a pilot program set to expire on December 10, 2010. 
The Exchange proposes to extend the pilot program to April 11, 2011.
    On September 10, 2010, the Commission approved, on a pilot basis, 
changes to BATS Rule 11.17 to provide for uniform treatment: (1) Of 
clearly erroneous execution reviews in multi-stock events involving 
twenty or more securities; and (2) in the event transactions occur that 
result in the issuance of an individual stock trading pause by the 
primary market and subsequent transactions that occur before the 
trading pause is in effect on the Exchange.\3\ The Exchange also 
adopted additional changes to Rule 11.17 that reduced the ability of 
the Exchange to deviate from the objective standards set forth in Rule 
11.17.\4\ The Exchange believes the benefits to market participants 
from the more objective clearly erroneous executions rule should be 
approved to continue on a pilot basis.
---------------------------------------------------------------------------

    \3\ Securities Exchange Act Release No. 62886 (September 10, 
2010), 75 FR 56613 (September 16, 2010) (SR-BATS-2010-016).
    \4\ Id.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal is consistent with the 
requirements of the Act and the rules and regulations thereunder that 
are applicable to a national securities exchange, and, in particular, 
with the requirements of Section 6(b) of the Act.\5\ In particular, the 
proposal is consistent with Section 6(b)(5) of the Act,\6\ because it 
would promote just and equitable principles of trade, remove 
impediments to, and perfect the mechanism of, a free and open market 
and a national market system. The Exchange believes that the pilot 
program promotes just and equitable principles of trade in that it 
promotes transparency and uniformity across

[[Page 78328]]

markets concerning review of transactions as clearly erroneous.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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

    The Exchange does not believe that the proposed rule change imposes 
any burden on competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    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 \7\ and Rule 19b-
4(f)(6)(iii) thereunder.\8\ The Exchange has asked the Commission to 
waive the 30-day operative delay so that the proposal may become 
operative immediately upon filing. The Commission believes that waiving 
the 30-day operative delay is consistent with the protection of 
investors and the public interest because such waiver will allow the 
pilot program to continue uninterrupted and help ensure uniformity 
among the national securities exchanges and FINRA with respect to the 
treatment of clearly erroneous transactions.\9\ Accordingly, the 
Commission waives the 30-day operative delay requirement and designates 
the proposed rule change as operative upon filing with the Commission.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) requires that a self-regulatory organization submit to 
the Commission written notice of its intent to file the proposed 
rule change, along with a brief description and text of the proposed 
rule change, at least five business days prior to the filing of the 
proposed rule change, or such shorter time as designated by the 
Commission. The Commission notes that the Exchange has satisfied 
this requirement.
    \9\ 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-BATS-2010-036 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-BATS-2010-036. 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 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-BATS-2010-036 and should be 
submitted on or before January 5, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-31450 Filed 12-14-10; 8:45 am]
BILLING CODE 8011-01-P
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