Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by BATS Exchange, Inc. to Adopt BATS Rule 11.21, entitled “Input of Accurate Information”, 12155-12157 [2011-4886]
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Federal Register / Vol. 76, No. 43 / Friday, March 4, 2011 / Notices
jlentini on DSKJ8SOYB1PROD with NOTICES
information about the LLP agreements
concerning the proposed crossmargining arrangements.
The Commission believes FICC’s
commitment to provide ongoing
information with respect LLP
agreements would help to evaluate its
efforts to facilitate indirect access and
would thereby help to ensure that the
proposal would not impose any burden
on competition not necessary and
appropriate in furtherance of the
purposes of the Exchange Act,
consistent with Section 17A(b)(3)(I) of
the Act.94 The Commission anticipates
that this information will be primarily
used for the limited purpose of
identifying any instances in which there
is potential non-compliance with the
terms of this order or the
representations made by FICC.
The Commission has considered the
concerns presented by commenters and
has determined that the benefits of the
proposal outweigh any anti-competitive
effects of the proposal. The Commission
believes that the proposal would not
impose any burden on competition not
necessary and appropriate in
furtherance of the purposes of the
Exchange Act consistent with Section
17A(b)(3)(I) of the Act.95
C. Effect on Efficiency and Costs
As previously discussed, both FICC
and those commenting on the proposed
rule change expect that the crossmargining proposal will reduce costs,
including delivery costs, and increase
cash flows through margin efficiencies.
The Commission believes that the NYPC
Arrangement has the potential to
increase efficiencies by allowing
clearing agencies to streamline the
delivery process, employ common and
coordinated risk management and
margin methodologies, and lower costs
for market participants.
A ‘‘two-pot’’ arrangement allows for
offsets and lowered margin based on
correlations in a members’ cleared
positions at different clearinghouses;
however, there is not a unified
arrangement for risk management or loss
allocations.96 The ‘‘two-pot’’ crossmargining arrangements approved by
the Commission in the past, including
one between FICC and CME, have
allowed clearinghouses to allow credit
against the margin requirement for
offsetting positions cleared at another
clearinghouse, but each clearinghouse
maintained and managed separate pools
94 15
U.S.C. 78q–1(b)(3)(I).
U.S.C. 78q–1(b)(3)(I).
96 See Securities and Exchange Act Release No.
44301, 66 FR 28297 (May 11, 2001) (approving a
‘‘two-pot’’ cross-margining proposal between FICC’s
predecessor and CME).
95 15
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19:16 Mar 03, 2011
Jkt 223001
of collateral. The ‘‘one-pot’’ arrangement
would offer greater margin reductions
than a ‘‘two-pot’’ arrangement.
As result of these benefits in
facilitating a more accurate and costeffective system for settlement, the
Commission believes that the proposal
would promote the prompt and accurate
clearance and settlement of securities
transactions and help assure the
safeguarding of securities and funds in
a manner consistent with Section
17A(b)(3)(F) of the Act.97
D. Additional Reporting
As noted above, FICC has represented
that it will provide certain information
and reports to the Commission on an
ongoing basis in order to facilitate
ongoing monitoring of the crossmargining arrangement and thereby
help ensure compliance with the
standards in Section 17A of the Act.98
In particular, with respect to
information pertaining to risk matters,
the Commission believes that these
reports would assist the Commission in
its efforts to monitor risk management
practices under the cross-margining
arrangement by providing information
to help confirm that the actual
performance of the models and systems
are consistent with those anticipated
during tests prior to launch.
Specifically, FICC has agreed to provide
the following information upon the
proposed rule change becoming
effective:
• For the first 250 trading days upon
the proposed rule change becoming
effective, FICC will provide the
Commission staff with quarterly reports
that itemize divergences between CME
prices and NYSE Liffe prices for ‘‘lookalike contracts.’’ 99
• Semi-annually, FICC will provide
the Commission staff with reports
summarizing the sensitivity of the
model used for the NYPC Agreement
and the collected margin to the model’s
assumptions and established
parameters.
• Quarterly, FICC will provide the
Commission staff with detailed portfolio
analyses of members participating in the
NYPC Arrangement.
• Monthly, FICC will provide the
Commission staff with reports
summarizing the details of: (1) Any
instances in which the account of a
97 15
U.S.C. 78q–1(b)(3)(F).
from Michael Bodson, Executive
Managing Director, Fixed Income Clearing
Corporation and Walt Lukken, Chief Executive
Officer, New York Portfolio Clearing, LLC (February
27, 2011).
99 ‘‘Look-alike contracts’’ refers to contracts that
have similar economic features but are traded
separately on CME and NYSE Liffe.
98 Letter
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Fmt 4703
Sfmt 4703
12155
member participating in the NYPC
Agreement experienced a loss that
exceeded its margin requirement and
the magnitude of such loss; (2) FICC’s
analysis of the sufficiency of NYPC’s
guaranty fund in conjunction with
NYPC; and (3) FICC’s analysis of daily
correlations between the futures and
cash products that are subject to the
NYPC Arrangement.
• FICC will provide the Commission
staff with DTCC’s periodic default
simulations that factor in members’
participation in the NYPC Agreement.
• For 24 months upon the proposed
rule change becoming effective, FICC
will provide the Commission staff with
information on a quarterly basis
regarding potential LPPs, including
progress on negotiations and
discussions of agreements or potential
agreements with potential LPPs.
• FICC will provide the Commission
all agreements entered into between
NYPC and any LPPs, as well as all
amendments to such agreements,
including, but not limited to, those
regarding changes in the fee
arrangements.
V. Conclusion
On the basis of the foregoing, the
Commission finds that the proposed
rule change is consistent with the
requirements of the Act and in
particular Section 17A of the Act 100 and
the rules and regulations thereunder.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act, that the
proposed rule change (File No. SR–
FICC–2010–09) be, and hereby is,
approved.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–4836 Filed 3–3–11; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–63969; File No. SR–BATS–
2011–007]
Self-Regulatory Organizations; BATS
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change by BATS Exchange, Inc.
to Adopt BATS Rule 11.21, entitled
‘‘Input of Accurate Information’’
February 25, 2011.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
100 15
U.S.C. 78q–1.
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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12156
Federal Register / Vol. 76, No. 43 / Friday, March 4, 2011 / Notices
notice is hereby given that on February
18, 2011, BATS Exchange, Inc.
(‘‘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 Exchange has
designated this proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A) of the
Act 3 and Rule 19b–4(f)(6)(iii)
thereunder,4 which renders it effective
upon filing with the Commission. 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 adopt new
BATS Rule 11.21 to require Members to
identify each order accurately as a
Principal, Agency, or Riskless Principal
Order.
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.
jlentini on DSKJ8SOYB1PROD with NOTICES
(A) Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to add new
BATS Rule 11.21 for the purpose of
increasing transparency and to enhance
the surveillance database and audit trail
of transaction data used by the
Exchange in surveillance of its market.
The proposed rule change would
require Members to identify the capacity
of each order accurately as a Principal,
Agency, or Riskless Principal Order. For
purposes of surveillance, the Exchange
currently identifies the capacity of each
order as Principal, Agency, or Riskless
Principal; however, several other
capacities are accepted upon order
entry, including no response, which are
thereafter mapped to one of the above-
listed order capacities. By limiting the
order capacity upon entry to Principal,
Agency, or Riskless Principal and
requiring Members to accurately submit
an order capacity for each order, the
Exchange will be able to more precisely
identify the type of order received and
more effectively surveil for abusive
trading.
BATS does not have a rule that makes
an explicit statement regarding a
Member’s obligation to input accurate
information into the System.
Notwithstanding, BATS believes that
disciplinary cases against Members
entering inaccurate or incomplete
information may be brought
appropriately under BATS Rule 3.1,
which requires Members to observe high
standards of commercial honor and just
and equitable principles of trade. Rule
3.1 protects the investing public and the
securities industry from dishonest
practices that are unfair to investors or
hinder the functioning of a free and
open market, even though those
practices may not be illegal or violate a
specific rule or regulation. Because of
the regulatory importance of accurate
information input in the System, BATS
believes a rule that directly addresses
Members’ obligation to provide accurate
information is warranted. The proposed
rule makes clear Members’ obligation to
input accurate information into the
System and that failure to do so would
be considered a violation of BATS
Rules.
BATS notes that it already has a rule
in place for its equity options platform
(‘‘BATS Options’’) that requires members
of BATS Options (‘‘Options Members’’)
to ensure that accurate information is
input into the System, a requirement
that includes, but is not limited to, the
capacity of the Options Member as it
relates to the order.5 The Commission
has also previously approved rules
proposed by the Nasdaq Stock Market
LLC (‘‘Nasdaq’’) that apply to Nasdaq
options and equities platforms and
require participants to ensure that
accurate information is entered into
Nasdaq’s system, including but not
limited to the capacity of the
participant.6 Thus, the proposed rule
change would: (1) make BATS Rules
regarding equity trading consistent with
its rules regarding options trading; and
(2) bring BATS Rules in line with those
of other self-regulatory organizations.
In order to allow Members sufficient
time to review and complete any
systems changes necessitated by this
4 17
Rule 18.2(a)(6).
6 See Securities Exchange Act Release 59547
(March 10, 2009), 74 FR 11386 (March 17, 2009).
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6)(iii).
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19:16 Mar 03, 2011
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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.7
Specifically, for the reasons described
above, the proposed change is
consistent with Section 6(b)(5) of the
Act,8 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 regulating, clearing, settling,
processing information with respect to,
and facilitating transactions in
securities, to remove impediments to
and perfect the mechanism of a free and
open market and a national market
system, and to protect investors and the
public interest. Specifically, the changes
proposed herein will serve to promote
the accuracy of information input into
the Exchange. Accurate information is
necessary for the efficient and fair
operation of the Exchange, and will
assist the Exchange in surveilling the
markets for fraudulent activity.
(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 Changes and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 9 and Rule 19b–4(f)(6) 10
thereunder because the proposal does
not: (i) Significantly affect the
protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) by its
terms, become operative for 30 days
from the date on which it was filed, or
such shorter time as the Commission
may designate if consistent with the
7 15
5 BATS
3 15
filing, the Exchange has proposed an
operative date of April 4, 2011.
PO 00000
Frm 00144
Fmt 4703
Sfmt 4703
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
9 15 U.S.C. 78s(b)(3)(A).
10 17 CFR 240.19b–4(f)(6).
8 15
E:\FR\FM\04MRN1.SGM
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Federal Register / Vol. 76, No. 43 / Friday, March 4, 2011 / Notices
protection of investors and the public
interest.11
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act.12
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–BATS–2011–007 on the
subject line.
jlentini on DSKJ8SOYB1PROD with NOTICES
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–2011–007. This file
number should be included on the
subject line if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street, NE.,
11 In addition, Rule 19b–4(f)(6)(iii) requires the
Exchange to give the Commission written notice of
the Exchange’s 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 satisfied this
requirement.
12 15 U.S.C. 78s(b)(3)(C).
VerDate Mar<15>2010
19:16 Mar 03, 2011
Jkt 223001
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
available publicly. All submissions
should refer to File Number SR–BATS–
2011–007 and should be submitted on
or before March 25, 2011.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011–4886 Filed 3–3–11; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–63971; File No. SR–
NYSEARCA–2011–05]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending NYSE Arca
Equities Rule 7.16 (Short Sales) in
Order To Implement the Provisions of
Rule 201 of Regulation SHO Under the
Securities Exchange Act of 1934
February 25, 2011.
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 February
24, 2011, 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 substantially prepared by the selfregulatory 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
NYSE Arca Equities Rule 7.16 (Short
Sales) in order to implement the
provisions of Rule 201 of Regulation
SHO (‘‘Rule 201’’) 4 under the Act,
13 17
CFR 200.30–3(a)(12).
1 15 U.S.C.78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
4 17 CFR 242.201.
PO 00000
Frm 00145
Fmt 4703
Sfmt 4703
12157
which, if triggered, imposes a restriction
on the prices at which covered
securities may be sold short (‘‘Short Sale
Price Test’’). Among other things, Rule
201 requires trading centers to establish,
maintain, and enforce written policies
and procedures reasonably designed to
prevent the execution or display of a
short sale order of a covered security at
a price that is less than or equal to the
current national best bid if the price of
a covered security decreases by 10% or
more from the covered security’s closing
price as determined by the listing
market for the covered security as of the
end of regular trading hours on the prior
day. The proposed rule amendment
would establish procedures for the
Exchange, as a listing market, to
determine that a Short Sale Price Test
has been triggered for a covered
security. The proposed rule amendment
would also establish the protocols for
the handling of short sale orders by the
Exchange, as a trading center, in the
event the Short Sale Price Test is
triggered, including establishing what
types of short sale orders will be repriced to achieve a permitted price, in
accordance with Rule 201, during the
period in which a Short Sale Price Test
is in effect (‘‘Short Sale Period’’).5
Amended Rule 7.16 would also
establish Exchange procedures
regarding the execution and display of
permissible orders during the Short Sale
Period, and the execution of orders
marked ‘‘short exempt.’’ Finally, the
proposed rule amendment would also
establish Exchange procedures for
addressing situations where the
Exchange determines that the Short Sale
Price Test for a covered security was
triggered by a ‘‘clearly erroneous’’
execution as that term is defined in
NYSE Arca Equities Rule 7.10.6
The Exchange also proposes to amend
NYSE Arca Equities Rule 7.65, which
applies to the Exchange’s Portfolio
Crossing Service (‘‘PCS’’), to exempt PCS
transactions from the short sale price
test restrictions contained in NYSE Arca
Equities Rule 7.16(f). PCS short sale
transactions would, however, be subject
to the order marking and securities
lending provisions of Paragraphs (a)–(e)
of NYSE Arca Equities Rule 7.16. The
text of the proposed rule change is
available at the Exchange, the
Commission’s Public Reference Room,
and https://www.nyse.com.
5 See
notes 23–31 infra and accompanying text.
infra note 22 and accompanying text
regarding ‘‘clearly erroneous’’ trades and proposed
Rule 7.16(f)(iv)(A). The proposed rule amendment
would, among other things, establish the duration
of the Short Sale Price Test. See infra note 21 and
accompanying text.
6 See
E:\FR\FM\04MRN1.SGM
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]]>Agencies
[Federal Register Volume 76, Number 43 (Friday, March 4, 2011)]
[Notices]
[Pages 12155-12157]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-4886]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63969; File No. SR-BATS-2011-007]
Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change by BATS
Exchange, Inc. to Adopt BATS Rule 11.21, entitled ``Input of Accurate
Information''
February 25, 2011.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\
[[Page 12156]]
notice is hereby given that on February 18, 2011, BATS Exchange, Inc.
(``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 Exchange has designated this proposal as a ``non-controversial''
proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and
Rule 19b-4(f)(6)(iii) thereunder,\4\ which renders it effective upon
filing with the Commission. 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.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to adopt new BATS Rule 11.21 to require
Members to identify each order accurately as a Principal, Agency, or
Riskless Principal Order.
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 Exchange proposes to add new BATS Rule 11.21 for the purpose of
increasing transparency and to enhance the surveillance database and
audit trail of transaction data used by the Exchange in surveillance of
its market. The proposed rule change would require Members to identify
the capacity of each order accurately as a Principal, Agency, or
Riskless Principal Order. For purposes of surveillance, the Exchange
currently identifies the capacity of each order as Principal, Agency,
or Riskless Principal; however, several other capacities are accepted
upon order entry, including no response, which are thereafter mapped to
one of the above-listed order capacities. By limiting the order
capacity upon entry to Principal, Agency, or Riskless Principal and
requiring Members to accurately submit an order capacity for each
order, the Exchange will be able to more precisely identify the type of
order received and more effectively surveil for abusive trading.
BATS does not have a rule that makes an explicit statement
regarding a Member's obligation to input accurate information into the
System. Notwithstanding, BATS believes that disciplinary cases against
Members entering inaccurate or incomplete information may be brought
appropriately under BATS Rule 3.1, which requires Members to observe
high standards of commercial honor and just and equitable principles of
trade. Rule 3.1 protects the investing public and the securities
industry from dishonest practices that are unfair to investors or
hinder the functioning of a free and open market, even though those
practices may not be illegal or violate a specific rule or regulation.
Because of the regulatory importance of accurate information input in
the System, BATS believes a rule that directly addresses Members'
obligation to provide accurate information is warranted. The proposed
rule makes clear Members' obligation to input accurate information into
the System and that failure to do so would be considered a violation of
BATS Rules.
BATS notes that it already has a rule in place for its equity
options platform (``BATS Options'') that requires members of BATS
Options (``Options Members'') to ensure that accurate information is
input into the System, a requirement that includes, but is not limited
to, the capacity of the Options Member as it relates to the order.\5\
The Commission has also previously approved rules proposed by the
Nasdaq Stock Market LLC (``Nasdaq'') that apply to Nasdaq options and
equities platforms and require participants to ensure that accurate
information is entered into Nasdaq's system, including but not limited
to the capacity of the participant.\6\ Thus, the proposed rule change
would: (1) make BATS Rules regarding equity trading consistent with its
rules regarding options trading; and (2) bring BATS Rules in line with
those of other self-regulatory organizations.
---------------------------------------------------------------------------
\5\ BATS Rule 18.2(a)(6).
\6\ See Securities Exchange Act Release 59547 (March 10, 2009),
74 FR 11386 (March 17, 2009).
---------------------------------------------------------------------------
In order to allow Members sufficient time to review and complete
any systems changes necessitated by this filing, the Exchange has
proposed an operative date of April 4, 2011.
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.\7\ Specifically, for
the reasons described above, the proposed change is consistent with
Section 6(b)(5) of the Act,\8\ 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 regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and to protect
investors and the public interest. Specifically, the changes proposed
herein will serve to promote the accuracy of information input into the
Exchange. Accurate information is necessary for the efficient and fair
operation of the Exchange, and will assist the Exchange in surveilling
the markets for fraudulent activity.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f(b).
\8\ 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 Changes and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \9\ and Rule 19b-4(f)(6) \10\ thereunder because
the proposal does not: (i) Significantly affect the protection of
investors or the public interest; (ii) impose any significant burden on
competition; and (iii) by its terms, become operative for 30 days from
the date on which it was filed, or such shorter time as the Commission
may designate if consistent with the
[[Page 12157]]
protection of investors and the public interest.\11\
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\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6).
\11\ In addition, Rule 19b-4(f)(6)(iii) requires the Exchange to
give the Commission written notice of the Exchange's 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 satisfied this
requirement.
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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.\12\
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\12\ 15 U.S.C. 78s(b)(3)(C).
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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-2011-007 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-2011-007. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for website viewing and
printing in the Commission's Public Reference Room, 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 available publicly. All
submissions should refer to File Number SR-BATS-2011-007 and should be
submitted on or before March 25, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-4886 Filed 3-3-11; 8:45 am]
BILLING CODE 8011-01-P
