Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Adopt a Market Order Spread Protection Feature, 35930-35931 [2011-15278]

Download as PDF 35930 Federal Register / Vol. 76, No. 118 / Monday, June 20, 2011 / Notices 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 (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–C2–2011–013 on the subject line. sroberts on DSK5SPTVN1PROD 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–C2–2011–013. 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 (http://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 available publicly. All submissions should refer to File No. SR–C2–2011– 013 and should be submitted on or before July 11, 2011. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.14 Cathy H. Ahn, Deputy Secretary. [FR Doc. 2011–15280 Filed 6–17–11; 8:45 am] SECURITIES AND EXCHANGE COMMISSION [Release No. 34–64667; File No. SR– NASDAQ–2011–080] Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Adopt a Market Order Spread Protection Feature June 14, 2011. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 8, 2011, The NASDAQ Stock Market LLC (the ‘‘Exchange’’ or ‘‘NASDAQ’’) filed with the Securities and Exchange Commission ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change NASDAQ is filing with the Commission a proposal for the NASDAQ Options Market (‘‘NOM’’) to amend Chapter VI, Trading Systems, Section 1, Definitions, to adopt a Market Order Spread Protection feature, as described further below. This change is scheduled to be implemented on NOM on or about August 1, 2011; the Exchange will announce the implementation schedule by Options Trader Alert, once the rollout schedule is finalized. The text of the proposed rule change is available at http:// nasdaq.cchwallstreet.com/, at NASDAQ’s principal office, 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 BILLING CODE 8011–01–P 1 15 14 17 CFR 200.30–3(a)(12). VerDate Mar<15>2010 16:50 Jun 17, 2011 2 17 Jkt 223001 PO 00000 U.S.C. 78s(b)(1). CFR 240.19b–4. Frm 00099 Fmt 4703 Sfmt 4703 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 The purpose of the proposed rule change is to add an enhancement to NOM’s System to protect Market Orders from being executed in very wide markets. Specifically, the Market Order Spread Protection feature will validate the NBBO when such order is received. If the NBBO is wider than a preset threshold at the time the order is received, the Market Order will be rejected. For example, if the Market Order Spread Protection is set to $20.00, and a Market Order to buy is received while the NBBO is $1.00–$50.00, such Market Order will be rejected. The Exchange will establish the threshold at a number and notify Participants in an Options Trader Alert, with sufficient advanced notice, including if the threshold changes. The Exchange believes that this flexibility is important and similar to other configurable features.3 The Market Order Spread Protection, which is not optional, will be the same for all options traded on NOM and is applicable to all Participants submitting Market Orders. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act 4 in general, and furthers the objectives of Section 6(b)(5) of the Act 5 in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and to remove impediments to and perfect the mechanisms of a free and open market and a national market system, and, in general, to protect investors and the public interest, by mitigating risks to market participants. The Exchange believes that the proposal is appropriate and reasonable, because it offers a protection for Market Orders that may encourage price continuity, which should, in turn, protect investors and the public interest by reducing executions occurring at dislocated prices. 3 See e.g., PHLX Rule 1017(l)(iii)(A) regarding the Opening Quote Range, which is also a configurable feature. 4 15 U.S.C. 78f(b). 5 15 U.S.C. 78f(b)(5). E:\FR\FM\20JNN1.SGM 20JNN1 Federal Register / Vol. 76, No. 118 / Monday, June 20, 2011 / Notices Paper Comments 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 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 either solicited or received. 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 after the date of the filing, or such shorter time as the Commission may designate, it has become effective pursuant to 19(b)(3)(A) of the Act 6 and Rule 19b–4(f)(6) 7 thereunder. 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. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or 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 sroberts on DSK5SPTVN1PROD with NOTICES • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NASDAQ–2011–080 on the subject line. U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intent to file the proposed rule change at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. Deputy Secretary. [FR Doc. 2011–15278 Filed 6–17–11; 8:45 am] BILLING CODE 8011–01–P Jkt 223001 [Release No. 34–64666; File No. SR–NSCC– 2011–03] A. Self-Regulatory Organization’s Statement of Purpose of, and Statutory Basis for, the Proposed Rule Change Under the proposed rule change, NSCC will amend Rule 57 (Insurance and Retirement Processing Services), Section 12 (Analytic Reporting Service) to clarify (i) the scope of information included within the Analytic Reporting Service and (ii) the opt-out provisions 7 17 16:50 Jun 17, 2011 SECURITIES AND EXCHANGE COMMISSION Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and All submissions should refer to File Immediate Effectiveness of Proposed Number SR–NASDAQ–2011–080. This Rule Change Relating to the Analytic file number should be included on the subject line if e-mail is used. To help the Reporting Service Commission process and review your June 14, 2011. comments more efficiently, please use Pursuant to Section 19(b)(1) of the only one method. The Commission will Securities Exchange Act of 1934 post all comments on the Commission’s (‘‘Act’’),1 notice is hereby given that on Internet Web site (http://www.sec.gov/ June 2, 2011, the National Securities rules/sro.shtml). Copies of the Clearing Corporation (‘‘NSCC’’) filed submission, all subsequent with the Securities and Exchange amendments, all written statements Commission (‘‘Commission’’) the with respect to the proposed rule proposed rule change as described in Items I and II below, which Items have change that are filed with the been prepared primarily by NSCC. Commission, and all written NSCC filed the proposed rule change communications relating to the pursuant to Section 19(b)(3)(A)(iii) of proposed rule change between the Commission and any person, other than the Act 2 and Rule 19b–4(f)(4) thereunder 3 so that the proposal was those that may be withheld from the effective upon filing with the public in accordance with the Commission. The Commission is provisions of 5 U.S.C. 552, will be publishing this notice to solicit available for Web site viewing and comments on the proposed rule change printing in the Commission’s Public from interested persons. Reference Room, 100 F Street, NE., Washington, DC 20549, on official I. Self-Regulatory Organization’s Statement of Terms of Substance of the business days between the hours of 10 a.m. and 3 p.m. Copies of the filing also Proposed Rule Change will be available for inspection and The proposed rule change clarifies copying at the principal office of the provisions related to the Analytic Exchange. All comments received will Reporting Service. be posted without change; the II. Self-Regulatory Organization’s Commission does not edit personal Statement of Purpose of, and Statutory identifying information from Basis for, the Proposed Rule Change submissions. You should submit only In its filing with the Commission, information that you wish to make NSCC included statements concerning available publicly. the purpose of and basis for the All submissions should refer to File proposed rule change and discussed any Number SR–NASDAQ–2011–080 and comments it received on the proposed should be submitted on or before July rule change. The text of these statements 11, 2011. may be examined at the places specified in Item IV below. NSCC has prepared For the Commission, by the Division of summaries, set forth in sections A, B, Trading and Markets, pursuant to delegated authority.8 and C below, of the most significant aspects of such statements. Cathy H. Ahn, 6 15 VerDate Mar<15>2010 35931 1 15 U.S.C. 78s(b)(1). U.S.C. 78s(b)(3)(A)(iii). 3 17 CFR 240.19b–4(f)(4). 2 15 8 17 PO 00000 CFR 200.30–3(a)(12). Frm 00100 Fmt 4703 Sfmt 4703 E:\FR\FM\20JNN1.SGM 20JNN1

Agencies

[Federal Register Volume 76, Number 118 (Monday, June 20, 2011)]
[Notices]
[Pages 35930-35931]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-15278]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64667; File No. SR-NASDAQ-2011-080]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Adopt a Market Order Spread Protection Feature

June 14, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on June 8, 2011, The NASDAQ Stock Market LLC (the ``Exchange'' or 
``NASDAQ'') filed with the Securities and Exchange Commission 
``Commission'') the proposed rule change as described in Items I, II, 
and III 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.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NASDAQ is filing with the Commission a proposal for the NASDAQ 
Options Market (``NOM'') to amend Chapter VI, Trading Systems, Section 
1, Definitions, to adopt a Market Order Spread Protection feature, as 
described further below.
    This change is scheduled to be implemented on NOM on or about 
August 1, 2011; the Exchange will announce the implementation schedule 
by Options Trader Alert, once the rollout schedule is finalized.
    The text of the proposed rule change is available at http://nasdaq.cchwallstreet.com/, at NASDAQ's principal office, 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 aspects 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 the proposed rule change is to add an enhancement to 
NOM's System to protect Market Orders from being executed in very wide 
markets. Specifically, the Market Order Spread Protection feature will 
validate the NBBO when such order is received. If the NBBO is wider 
than a preset threshold at the time the order is received, the Market 
Order will be rejected. For example, if the Market Order Spread 
Protection is set to $20.00, and a Market Order to buy is received 
while the NBBO is $1.00-$50.00, such Market Order will be rejected.
    The Exchange will establish the threshold at a number and notify 
Participants in an Options Trader Alert, with sufficient advanced 
notice, including if the threshold changes. The Exchange believes that 
this flexibility is important and similar to other configurable 
features.\3\ The Market Order Spread Protection, which is not optional, 
will be the same for all options traded on NOM and is applicable to all 
Participants submitting Market Orders.
---------------------------------------------------------------------------

    \3\ See e.g., PHLX Rule 1017(l)(iii)(A) regarding the Opening 
Quote Range, which is also a configurable feature.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \4\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \5\ in particular, in that it is designed to prevent 
fraudulent and manipulative acts and practices, to promote just and 
equitable principles of trade, to foster cooperation and coordination 
with persons engaged in facilitating transactions in securities, and to 
remove impediments to and perfect the mechanisms of a free and open 
market and a national market system, and, in general, to protect 
investors and the public interest, by mitigating risks to market 
participants. The Exchange believes that the proposal is appropriate 
and reasonable, because it offers a protection for Market Orders that 
may encourage price continuity, which should, in turn, protect 
investors and the public interest by reducing executions occurring at 
dislocated prices.
---------------------------------------------------------------------------

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

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[[Page 35931]]

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 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 either solicited or received.

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 after the date of the filing, or such 
shorter time as the Commission may designate, it has become effective 
pursuant to 19(b)(3)(A) of the Act \6\ and Rule 19b-4(f)(6) \7\ 
thereunder.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    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. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or 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 (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NASDAQ-2011-080 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-NASDAQ-2011-080. 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 (http://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-NASDAQ-2011-080 and 
should be submitted on or before July 11, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-15278 Filed 6-17-11; 8:45 am]
BILLING CODE 8011-01-P