Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Amend EDGX Rule 11.5, 81691-81692 [2010-32613]
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Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Notices
81691
100 F Street, NE., Washington, DC
20549–1090.
SECURITIES AND EXCHANGE
COMMISSION
sections A, B and C below, of the most
significant aspects of such statements.
All submissions should refer to File
Number SR–Phlx–2010–183. 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. 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–Phlx–
2010–183 and should be submitted on
or before January 18, 2011.
[Release No. 34–63589; File No. SR–EDGX–
2010–24]
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–32623 Filed 12–27–10; 8:45 am]
emcdonald on DSK2BSOYB1PROD with NOTICES
BILLING CODE 8011–01–P
Self-Regulatory Organizations; EDGX
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change to Amend EDGX Rule
11.5
December 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 December
13, 2010, 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.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
EDGX proposes to amend EDGX Rule
11.5(a)(2) to provide that the system
functionality that cancels any portion of
a market order submitted to the
Exchange that would execute at a price
that is more than $0.50 or 5 percent
worse than last sale at the time the order
initially reaches the Exchange,
whichever is greater, does not apply to
Destination-on-Open orders, as defined
in Rule 11.5(c)(10). The text of the
proposed rule change is available on the
Exchange’s Internet Web site at https://
www.directedge.com, on the
Commission’s Web site at https://
www.sec.gov, 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
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 these statements may be examined at
the places specified in Item IV below.
The self-regulatory organization has
prepared summaries, set forth in
1 15
9 17
CFR 200.30–3(a)(12).
VerDate Mar<15>2010
22:37 Dec 27, 2010
2 17
Jkt 223001
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00132
Fmt 4703
Sfmt 4703
1. Purpose
As provided in SR–EDGX–2010–14,3
Exchange Rule 11.5(a)(2) protects
market participants from executions at
prices that are significantly worse than
the last sale at the time of order entry
by providing Exchange system
functionality that cancels any portion of
a market order (as defined in Rule
11.5(a)(2)) that would execute at a price
that is 50 cents or 5 percentage points
worse than the consolidated last sale,
whichever is greater. Any portion of a
market order that would otherwise
execute outside of these thresholds is
immediately cancelled back to the
User.4
The Exchange proposes to modify
Rule 11.5(a)(2) to provide that
Destination-on-Open orders, as defined
in Rule 11.5(c)(10),5 are not subject to
these market collars.6 The rationale for
this exception is twofold. First, using a
reference price calculation for market
collar thresholds at the open of trading
is problematic because of the potential
lack of trading activity just prior to the
open and the resulting price dislocation.
Therefore, the reference price for a
market collar on a Destination-on-Open
order could be out of line with the
market at the open of the regular trading
session. In addition, other Exchanges
also address this issue similarly by
excluding market on open orders as
well.7
2. Statutory Basis
The statutory basis for the proposed
rule change is Section 6(b)(5) of the
3 See Securities Exchange Act Release No. 63163
(October 22, 2010), 75 FR 66408 (October 28, 2010)
(SR–EDGX–2010–14).
4 A User is defined in Exchange Rule 1.5(cc) as
‘‘any Member or Sponsored Participant who is
authorized to obtain access to the System pursuant
to Rule 11.3’’.
5 Rule 11.5(c)(10) defines a Destination-on-Open
order, in part, as ‘‘a market or limit order that
instructs the System to route the order to a specified
away trading center to participate in said trading
center’s opening process, without being processed
by the System as described below in Rule
11.9(b)(1).’’
6 The Exchange notes that when orders are routed
to an away trading center, such away trading
centers’ collar rules apply, when applicable,
regardless of the Exchange’s proposed exclusion for
Destination-on-Open orders.
7 See, e.g., Nasdaq Rule 4751(f)(13) which
excludes market on open orders from the definition
of ‘‘collared orders.’’ See also Securities Exchange
Act Release No. 60371 (July 23, 2009), 74 FR 38075
(July 30, 2009) (SR–Nasdaq–2009–070).
E:\FR\FM\28DEN1.SGM
28DEN1
81692
Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Notices
Act,8 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 Exchange believes
that excluding Destination-on-Open
orders from the application of market
collars is appropriate in order to avoid
the potential dislocation between the
reference price for a market collar on a
Destination-on-Open order and the
market at the open of the regular trading
session. Accordingly, the modifications
to Exchange Rule 11.5 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 will issue an
information circular to all Members
prior to implementation, which will be
on or about December 14, 2010.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The proposed rule change does not
impose any burden on competition that
is not necessary or appropriate in
furtherance of the purposes of the Act.
emcdonald on DSK2BSOYB1PROD with NOTICES
C. Self-Regulatory Organization’s
Statement on Comments Regarding the
Proposed Rule Change Received From
Members, Participants or Others
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
members or other interested parties.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change: (1) Does not significantly affect
the protection of investors or the public
interest; (2) does not impose any
significant burden on competition; and
(3) by its terms does not become
operative for 30 days after the date of
this filing, or such shorter time as the
Commission may designate if consistent
with the protection of investors and the
public interest, the proposed rule
change has become effective pursuant to
Section 19(b)(3)(A) 9 of the Act and Rule
19b–4(f)(6) thereunder.10
8 15
U.S.C. 78f(b)(5).
9 15 U.S.C. 78s(b)(3)(A).
10 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires a self-regulatory organization to
provide the Commission with written notice of its
intent to file the proposed rule change, along with
a brief description and text of the proposed rule
change, at least five business days prior to the date
VerDate Mar<15>2010
22:37 Dec 27, 2010
Jkt 223001
A proposed rule change filed under
Rule 19b–4(f)(6) 11 normally may not
become operative prior to 30 days after
the date of filing. However, Rule 19b–
4(f)(6)(iii) 12 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, as
specified in Rule 19b–4(f)(6)(iii),13
which would make the proposed rule
change effective and operative upon
filing. The Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest.14 The
Commission notes that the proposal is
based on the rules of another SRO that
similarly excludes market on open
orders from its market collar
functionality.15 Accordingly, the
Commission designates the proposed
rule change operative upon filing with
the Commission.
At any time within 60 days of the
filing of such 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–EDGX–2010–24 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
of filing of the proposed rule change, or such
shorter time as designated by the Commission. The
Exchange has met this requirement.
11 17 CFR 240.19b–4(f)(6).
12 17 CFR 240.19b–4(f)(6)(iii).
13 Id.
14 For purposes only of waiving the operative
delay for this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
15 See supra note 7.
PO 00000
Frm 00133
Fmt 4703
Sfmt 4703
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–EDGX–2010–24. 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
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 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–EDGX–2010–24 and should
be submitted on or before January 18,
2011.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–32613 Filed 12–27–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–63581; File No. SR–
NYSEArca–2010–117]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing of Proposed
Rule Change Relating to Listing and
Trading Shares of the Grail Western
Asset Ultra Short Duration ETF Under
NYSE Arca Equities Rule 8.600
December 20, 2010.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
16 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
E:\FR\FM\28DEN1.SGM
28DEN1
]]>Agencies
[Federal Register Volume 75, Number 248 (Tuesday, December 28, 2010)]
[Notices]
[Pages 81691-81692]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-32613]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63589; File No. SR-EDGX-2010-24]
Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change to Amend
EDGX Rule 11.5
December 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 December 13, 2010, 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
EDGX proposes to amend EDGX Rule 11.5(a)(2) to provide that the
system functionality that cancels any portion of a market order
submitted to the Exchange that would execute at a price that is more
than $0.50 or 5 percent worse than last sale at the time the order
initially reaches the Exchange, whichever is greater, does not apply to
Destination-on-Open orders, as defined in Rule 11.5(c)(10). The text of
the proposed rule change is available on the Exchange's Internet Web
site at https://www.directedge.com, on the Commission's Web site at
https://www.sec.gov, 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 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 these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
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
As provided in SR-EDGX-2010-14,\3\ Exchange Rule 11.5(a)(2)
protects market participants from executions at prices that are
significantly worse than the last sale at the time of order entry by
providing Exchange system functionality that cancels any portion of a
market order (as defined in Rule 11.5(a)(2)) that would execute at a
price that is 50 cents or 5 percentage points worse than the
consolidated last sale, whichever is greater. Any portion of a market
order that would otherwise execute outside of these thresholds is
immediately cancelled back to the User.\4\
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 63163 (October 22,
2010), 75 FR 66408 (October 28, 2010) (SR-EDGX-2010-14).
\4\ A User is defined in Exchange Rule 1.5(cc) as ``any Member
or Sponsored Participant who is authorized to obtain access to the
System pursuant to Rule 11.3''.
---------------------------------------------------------------------------
The Exchange proposes to modify Rule 11.5(a)(2) to provide that
Destination-on-Open orders, as defined in Rule 11.5(c)(10),\5\ are not
subject to these market collars.\6\ The rationale for this exception is
twofold. First, using a reference price calculation for market collar
thresholds at the open of trading is problematic because of the
potential lack of trading activity just prior to the open and the
resulting price dislocation. Therefore, the reference price for a
market collar on a Destination-on-Open order could be out of line with
the market at the open of the regular trading session. In addition,
other Exchanges also address this issue similarly by excluding market
on open orders as well.\7\
---------------------------------------------------------------------------
\5\ Rule 11.5(c)(10) defines a Destination-on-Open order, in
part, as ``a market or limit order that instructs the System to
route the order to a specified away trading center to participate in
said trading center's opening process, without being processed by
the System as described below in Rule 11.9(b)(1).''
\6\ The Exchange notes that when orders are routed to an away
trading center, such away trading centers' collar rules apply, when
applicable, regardless of the Exchange's proposed exclusion for
Destination-on-Open orders.
\7\ See, e.g., Nasdaq Rule 4751(f)(13) which excludes market on
open orders from the definition of ``collared orders.'' See also
Securities Exchange Act Release No. 60371 (July 23, 2009), 74 FR
38075 (July 30, 2009) (SR-Nasdaq-2009-070).
---------------------------------------------------------------------------
2. Statutory Basis
The statutory basis for the proposed rule change is Section 6(b)(5)
of the Act,\8\ 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
Exchange believes that excluding Destination-on-Open orders from the
application of market collars is appropriate in order to avoid the
potential dislocation between the reference price for a market collar
on a Destination-on-Open order and the market at the open of the
regular trading session. Accordingly, the modifications to Exchange
Rule 11.5 promote just and
[[Page 81692]]
equitable principles of trade, remove impediments to, and perfect the
mechanism of, a free and open market and a national market system.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange will issue an information circular to all Members
prior to implementation, which will be on or about December 14, 2010.
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not 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 Regarding the
Proposed Rule Change Received From Members, Participants or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change: (1) Does not
significantly affect the protection of investors or the public
interest; (2) does not impose any significant burden on competition;
and (3) by its terms does not become operative for 30 days after the
date of this filing, or such shorter time as the Commission may
designate if consistent with the protection of investors and the public
interest, the proposed rule change has become effective pursuant to
Section 19(b)(3)(A) \9\ of the Act and Rule 19b-4(f)(6) thereunder.\10\
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to provide the Commission
with written notice of its intent to file the proposed rule change,
along with a brief description and text of the proposed rule change,
at least five business days prior to the date of filing of the
proposed rule change, or such shorter time as designated by the
Commission. The Exchange has met this requirement.
---------------------------------------------------------------------------
A proposed rule change filed under Rule 19b-4(f)(6) \11\ normally
may not become operative prior to 30 days after the date of filing.
However, Rule 19b-4(f)(6)(iii) \12\ 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, as specified in Rule 19b-
4(f)(6)(iii),\13\ which would make the proposed rule change effective
and operative upon filing. The Commission believes that waiving the 30-
day operative delay is consistent with the protection of investors and
the public interest.\14\ The Commission notes that the proposal is
based on the rules of another SRO that similarly excludes market on
open orders from its market collar functionality.\15\ Accordingly, the
Commission designates the proposed rule change operative upon filing
with the Commission.
---------------------------------------------------------------------------
\11\ 17 CFR 240.19b-4(f)(6).
\12\ 17 CFR 240.19b-4(f)(6)(iii).
\13\ Id.
\14\ For purposes only of waiving the operative delay for this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
\15\ See supra note 7.
---------------------------------------------------------------------------
At any time within 60 days of the filing of such 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-EDGX-2010-24 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-EDGX-2010-24. 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 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 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-
EDGX-2010-24 and should be submitted on or before January 18, 2011.
---------------------------------------------------------------------------
\16\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-32613 Filed 12-27-10; 8:45 am]
BILLING CODE 8011-01-P
