Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca Options Rule 6.90 To Permit Qualified Contingent Cross Orders To Be Electronically Submitted to the NYSE Arca System From the Floor of the Exchange for Potential Execution, 49818-49821 [2011-20389]

Download as PDF 49818 Federal Register / Vol. 76, No. 155 / Thursday, August 11, 2011 / Notices For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.17 Elizabeth M. Murphy, Secretary. [FR Doc. 2011–20390 Filed 8–10–11; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements. [Release No. 34–65048; File No. SR– NYSEArca–2011–52] A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca Options Rule 6.90 To Permit Qualified Contingent Cross Orders To Be Electronically Submitted to the NYSE Arca System From the Floor of the Exchange for Potential Execution 1. Purpose The purpose of this filing is to amend Rule 6.90 to permit QCCs to be electronically submitted to the NYSE Arca System from the Floor of the Exchange for potential execution.4 This filing is modeled after a recently approved rule change by NASDAQ OMX PHLX (‘‘PHLX’’).5 August 5, 2011. Background The Exchange recently adopted rules that permit OTP Holders to submit QCCs electronically from off the Floor through the NYSE Arca System.6 The QCC permits an NYSE Arca OTP Holder to effect a qualified contingent trade (‘‘QCT’’) in a Regulation NMS stock and cross the options leg of the trade on the Exchange immediately upon entry and without order exposure if the order is for at least 1,000 contracts, is part of a QCT, is executed at a price at least equal to the NBBO and if there are no Customer Orders in the Exchange’s Consolidated Book at the same price.7 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 August 1, 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 prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend NYSE Arca Options Rule 6.90 to permit Qualified Contingent Cross Orders (‘‘QCCs’’) to be electronically submitted to the NYSE Arca System from the Floor of the Exchange for potential execution. The text of the proposed rule change is available at the Exchange’s Web site at https://www.nyse.com, on the Commission’s Web site at https:// www.sec.gov, at the Exchange’s principal office, and at the Commission’s Public Reference Room. srobinson on DSK4SPTVN1PROD with NOTICES 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, 17 17 CFR 200.30–3(a)(12). U.S.C.78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 1 15 VerDate Mar<15>2010 17:49 Aug 10, 2011 Jkt 223001 4 The NYSE Arca System is configured to automatically reject a QCC entered when the order is for less than 1,000 contracts, is entered at a price worse than the national best bid or offer (‘‘NBBO’’) or is entered at the same price as Customer orders in the Exchange’s Consolidated Book. 5 See Securities Exchange Act Release No. 64688 (June 16, 2011), 76 FR 36606 (June 22, 2011) (SR– Phlx–2011–56). 6 See Securities Exchange Act Release No. 64086 (March 17, 2011), 76 FR 16021 (March 22, 2011) (SR–NYSEArca–2011–09) (‘‘NYSE Arca Electronic QCC Filing’’). 7 A QCT is a transaction consisting of two or more component orders, executed as agent or principal, where: (a) At least one component is an NMS stock, as defined in Rule 600 of Regulation NMS under the Exchange Act; (b) all components are effected with a product or price contingency that either has been agreed to by all the respective counterparties or arranged for by a broker-dealer as principal or agent; (c) the execution of one component is contingent upon the execution of all other components at or near the same time; (d) the specific relationship between the component orders (e.g., the spread between the prices of the component orders) is determined by the time the contingent order is placed; (e) the component orders bear a derivative relationship to one another, represent different classes of shares of the same issuer, or involve the securities of participants in mergers or with intentions to merge that have been announced or cancelled; and (f) the transaction is fully hedged (without regard to any prior existing PO 00000 Frm 00094 Fmt 4703 Sfmt 4703 The NYSE Arca Electronic QCC Filing was based on an International Securities Exchange (‘‘ISE’’) rule approved by the Commission.8 The ISE QCC Proposal was controversial, attracting opposition from multiple exchanges including NYSE Arca.9 The Commission, however, ultimately approved the ISE QCC Proposal, finding it to be consistent with the Securities Exchange Act of 1934 (the ‘‘Act’’). NYSE Arca implemented the NYSE Arca Electronic QCC Filing, and is proposing this rule change, as a competitive response to the approval of the PHLX floor-based QCC filing. Under the NYSE Arca Electronic QCC Filing, QCCs currently may only be submitted electronically from off the Floor through the NYSE Arca System. In this regard, OTP Holders on the Floor of the Exchange are not allowed to enter QCCs into the NYSE Arca System, or otherwise effect them in open outcry. To provide a mechanism for the Exchange to surveil for whether QCCs were entered from off of the Floor, the Exchange adopted Commentary .01 to Rule 6.90, which requires OTP Holders to maintain books and records demonstrating that each QCC was routed to the NYSE Arca System from off of the Floor. Presently, any QCC that does not have a corresponding record required by this provision would be deemed to have been entered from on the Floor in violation of Rule 6.90. In addition, the Exchange has adopted policies and procedures to ensure that OTP Holders use the QCC properly.10 Discussion QCCs permit OTP Holders to provide their customers a net price for the entire position) as a result of other components of the contingent trade. See Securities Exchange Act Release No. 57620 (April 4, 2008), 73 FR 19271 (April 9, 2008) (the ‘‘QCT Release’’). That release superseded a release initially granting the QCT exemption. See Securities Exchange Act Release No. 54389 (August 31, 2006), 71 FR 52829 (September 7, 2006) (‘‘Original QCT Exemption’’). 8 See Securities Exchange Act Release No. 63955 (February 24, 2011), 76 FR 11533 (March 2, 2011) (SR–ISE–2010–73) (‘‘ISE Approval’’). See also Securities Exchange Act Release No. 62523 (July 16, 2010), 75 FR 43211 (July 23, 2010) (SR–ISE–2010– 73) (‘‘ISE QCC Proposal’’). 9 The Exchange notes that letters commenting on the ISE Proposal were submitted on its behalf by the Exchange’s parent company, NYSE Euronext. See e.g., letters dated August 9, 2010 and October 21, 2010 from Janet L. McGinness, Senior Vice President—Legal & Corporate Secretary, Legal & Government Affairs, NYSE Euronext. 10 First, the Exchange requires OTP Holders to properly mark all QCCs as such. In addition, the Financial Industry Regulatory Authority (‘‘FINRA’’), on behalf of the Exchange, has implemented an examination and surveillance program to assess OTP Holder compliance with the requirements applicable to QCCs, including the requirement that the stock leg of the transaction be executed at or near the same time as the options leg. E:\FR\FM\11AUN1.SGM 11AUN1 Federal Register / Vol. 76, No. 155 / Thursday, August 11, 2011 / Notices srobinson on DSK4SPTVN1PROD with NOTICES trade, and then allow the OTP Holder to execute the options leg of the trade on the Exchange at a price at least equal to the NBBO while using the QCT exemption to effect the trade in the equities leg at a price necessary to achieve the net price. The Exchange hereby proposes to permit QCCs to be electronically entered from the Floor of the Exchange by Floor Brokers and executed immediately upon entry without exposure into the NYSE Arca System provided that no Customer Orders exist on the Exchange’s Consolidated Book at the execution price, that the order is for at least 1,000 contracts,11 and that the execution price is at or between the NBBO.12 QCCs entered from the Floor of the Exchange would be electronically entered into the NYSE Arca System by a Floor Broker.13 The impact of this proposal, coupled with the NYSE Arca Electronic QCC Filing, would be that OTP Holders would be able to enter QCCs both on and off of the Floor. The Exchange therefore proposes to eliminate the requirements from NYSE Arca Rule 6.90 that QCCs only be submitted electronically from off the Floor to the NYSE Arca System and from Commentary .01 to NYSE Arca Rule 6.90 that OTP Holders maintain books and records demonstrating that each QCC was routed to the NYSE Arca System from off of the Floor, as both will no longer be necessary if QCCs are available for entry from the Floor. The Commission in the ISE Approval carefully considered the comparison between floor-based and electronic trading, including commissioning a study by the Division of Risk, Strategy and Financial Innovation (‘‘RiskFin Study’’). The RiskFin Study and the ISE Approval compare electronic trading and floor trading, the similarities 11 In order to satisfy the 1,000-contract requirement, a QCC must be for 1,000 contracts and could not be, for example, two 500-contract orders or two 500-contract legs. 12 The Exchange does not propose to change the definition of ‘‘Qualified Contingent Cross Order’’ in NYSE Arca Rule 6.62. Thus, like QCCs effected pursuant to the NYSE Arca Electronic QCC Filing, QCCs entered from the Floor would need to meet the requirements of NYSE Arca Rule 6.62 and Commentary .02 of that rule. Additionally, QCCs entered from the Floor by a Floor Broker would be entered electronically into the NYSE Arca System where a systemic check would be performed to determine whether a Customer Order is resting on the Exchange’s Consolidated Book at the same price as the QCC, whether the order was for less than 1,000 contracts or whether the execution price would be outside the NBBO, each of which would cause the QCC to be rejected. If, however, the QCC is not rejected, then the NYSE Arca System would execute the QCC and simultaneously assign it an execution time. 13 As proposed, only Floor Brokers would be permitted to enter QCCs from on the Floor and QCCs would not be permitted in open outcry. VerDate Mar<15>2010 15:59 Aug 10, 2011 Jkt 223001 between the two forms of trading, and the ability of one to replicate the other. Additionally, the Commission received comment letters from multiple floorbased exchanges that challenged the comparison that ISE drew between floor-based and electronic trading. Despite facing direct comparisons between floor-based trading and electronic trading by multiple commenters, as well as by its own Division of RiskFin, the ISE Approval focuses on similarities between the two. The Exchange believes that the ISE Approval, on its face, draws no distinctions and identifies no material differences between floor-based and electronic trading that would confound the comparison between cross orders entered electronically and those entered on an exchange floor. The Exchange believes that its proposal to permit the entry of QCCs from the Floor is consistent with the requirements stated in the ISE Approval and consistent with the Act. The Exchange also believes that the Commission, in issuing the ISE Approval, assumed that QCC orders entered on the floor of an exchange that meet the requirements stated in the ISE Approval are equally consistent with the Act. The Exchange has analyzed the application of Section 11(a) of the Act, and the rules thereunder, to QCCs entered from the Floor. Section 11(a) and the rules thereunder generally prohibit members of an exchange from effecting transactions on the exchange for their own account, the account of an associated person, or an account with respect to which it or an associated person thereof exercises investment discretion unless an exemption applies.14 Section 11(a) contains multiple exemptions, including exemptions for dealers acting in the capacity of market makers, odd-lot dealers, and firms engaged in stabilizing conduct; there are also rule-based exemptions such as the ‘‘effect vs. execute’’ exception under SEC Rule 11a2–2(T) under the Act.15 The Exchange has in the past analyzed the application of Section 11(a) to various Exchange systems and order types.16 The Exchange believes that the entry and execution of QCCs from the Floor raises no novel issues under Section 11(a) and the rules thereunder from a compliance, surveillance or enforcement perspective. In other words, OTP Holders on the 14 See 15 U.S.C. 78k(a). 17 CFR 240.11a2–2(T). 16 See, e.g. Securities Exchange Act Release No. 54238 (July 28, 2006), 71 FR 44758 (August 7, 2006) (SR–NYSEArca–2006–13). 15 See PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 49819 Floor are currently required to comply and are subject to review for compliance with Section 11(a), and the rules thereunder, when using Exchange systems to effect transactions using existing order types, and they will be required to comply with Section 11(a) and the rules thereunder when entering QCCs from the Floor. Nonetheless, out of an abundance of caution, the Exchange proposes to amend Commentary .01 to NYSE Arca Rule 6.90 to prohibit Floor Brokers from entering QCCs from the Floor for their own accounts, the account of an associated person, or an account with respect to which it or an associated person thereof exercises investment discretion (each a ‘‘prohibited account’’).17 These restrictions set forth in Commentary .01 to NYSE Arca Rule 6.90 would not limit in any way the obligation of OTP Holders, on the Floor or otherwise, to comply with Section 11(a) or the rules thereunder. For example, Floor Brokers cannot avoid or circumvent their obligations under Section 11(a) with respect to a QCC entered from the Floor by transmitting that order to another OTP Holder on the Floor or to an OTP Holder off the Floor of the Exchange. Likewise, OTP Holders off the Floor must ensure that their QCCs comply with Section 11(a) and the rules thereunder. In both cases, OTP Holders must ensure compliance with Section 11(a) and the rules thereunder, including by relying upon an exemption such as those listed above. Additionally, to provide a mechanism for the Exchange to review whether QCCs have been entered properly by Floor Brokers, the Exchange proposes to further amend Commentary .01 to NYSE Arca Rule 6.90 to require OTP Holders on the Floor to maintain books and records demonstrating that no QCC was entered from the Floor by the OTP Holder in a prohibited account. Any QCC entered from the Floor that does not have a corresponding record required by this provision would be deemed to have been entered in violation of Commentary .01 to NYSE Arca Rule 6.90. The Exchange also proposes to amend Commentary .01 to NYSE Arca Rule 6.90 to clarify that NYSE Arca Rule 6.47 does not apply when Floor Brokers are executing QCCs. The Exchange is making this clarification to eliminate any confusion about whether the various crossing provisions in Rule 6.47 may apply to QCCs when they are 17 This restriction is the same as the one found in PHLX Rule 1064(e)(2). E:\FR\FM\11AUN1.SGM 11AUN1 49820 Federal Register / Vol. 76, No. 155 / Thursday, August 11, 2011 / Notices with other exchanges for these types of orders. In this regard, competition would result in benefits to the investing public, whereas a lack of competition would serve to limit the choices that the public has for execution of their options business. In addition, the proposed rule change is consistent with Section 11A(a)(1)(C) of the Act,23 in which Congress found that it is in the public interest and appropriate for the protection of investors and the maintenance of fair and orderly markets to assure, among other things, the economically efficient execution of securities transactions. As described in detail above, the proposed rule change is also consistent with Section 11(a) of the Act and the rules thereunder. The Exchange believes, similar to the Commission’s basis for finding that ISE’s QCC proposal was consistent with the Act, that permitting the entry of QCCs from the Floor ‘‘would facilitate the execution of qualified contingent trades, for which the Commission found in the Original QCT Exemption to be of benefit to the market as a whole, contributing to the efficient functioning of the securities markets and the price discovery process.’’ 24 Further, permitting the entry of QCCs from the Floor ‘‘would provide assurance to parties to stock-option [QCTs] that their 2. Statutory Basis hedge would be maintained by allowing The Exchange believes the proposed the options component to be executed rule change is consistent with Section 25 6(b) of the Act,20 in general, and furthers as a clean cross.’’ In addition, like the ISE QCC Proposal, the Exchange’s 21 and the objectives of Section 6(b)(5) proposal to permit the entry of QCCs 6(b)(8) of the Act,22 in particular, from the Floor ‘‘is narrowly drawn and because it is designed to promote just establishes a limited exception to the and equitable principles of trade, general principle of exposure, and remove impediments to and perfect the retains the general principle of customer mechanisms of a free and open market priority in the options markets.’’ 26 and a national market system and, in general, to protect investors and the B. Self-Regulatory Organization’s public interest and does not impose any Statement on Burden on Competition burden on competition not necessary or appropriate in furtherance of the The Exchange does not believe that purposes of the Act. The proposed rule the proposed rule change will impose change is consistent with the protection any burden on competition that is not of investors in that it is designed to necessary or appropriate in furtherance prevent Trade-Throughs. In addition, of the purposes of the Act. the proposed rule change would C. Self-Regulatory Organization’s promote a free and open market by Statement on Comments on the permitting the Exchange to compete Proposed Rule Change Received From 18 This change is modeled after the changes to Members, Participants, or Others srobinson on DSK4SPTVN1PROD with NOTICES executed by Floor Brokers.18 In addition, the Exchange is moving a recordkeeping obligation from current Commentary .01 to Commentary 02 and modifying it to require that with respect to QCCs routed to the NYSE Arca System from off of the Floor, OTP Holders must maintain books and records demonstrating that each such order was routed to the system from off of the Floor.19 Finally, the Exchange is adding Commentary .03 to NYSE Arca Rule 6.90 to clarify that the order exposure requirements found in NYSE Arca Rule 6.47A do not apply to QCCs. That rule generally provides that with respect to orders routed to the NYSE Arca System, OTP Holders may not execute as principal orders they represent as agent unless such orders are first exposed on the Exchange for at least one second. The Exchange’s proposal addresses the mechanics of executing the stock and options components of a net-price transaction. The Exchange believes that it is necessary that it provide OTP Holders and their customers with the same trading capabilities available on other exchanges with respect to QCCs, including the change proposed herein, which would permit OTP Holders to execute the options legs of their customers’ large complex orders on the Exchange. PHLX Rule 1064(a), (b) and (c). 19 The Exchange also is clarifying that Commentary .02 would not apply to a Qualified Contingent Cross Order covered by Commentary .01 to NYSE Arca Rule 6.90 (i.e., a Qualified Contingent Cross Order routed to a Floor Broker for entry into the NYSE Arca System). 20 15 U.S.C. 78f(b). 21 15 U.S.C. 78f(b)(5). 22 15 U.S.C. 78f(b)(8). VerDate Mar<15>2010 15:59 Aug 10, 2011 Jkt 223001 No written comments were solicited or received with respect to the proposed rule change. 23 15 U.S.C. 78k–1(a)(1)(C). ISE Approval at 11540. 24 See 25 Id. 26 See PO 00000 ISE Approval at 11541. Frm 00096 Fmt 4703 Sfmt 4703 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 27 and Rule 19b–4(f)(6) thereunder.28 Because the 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 prior to 30 days from the date on which it was filed, 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) of the Act and Rule 19b–4(f)(6)(iii) thereunder. 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–NYSEArca–2011–52 on the subject line. Paper Comments • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–NYSEArca–2011–52. This file number should be included on the subject line if e-mail is used. To help the Commission process and review your 27 15 U.S.C. 78s(b)(3)(A)(iii). 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 complied with this requirement. 28 17 E:\FR\FM\11AUN1.SGM 11AUN1 Federal Register / Vol. 76, No. 155 / Thursday, August 11, 2011 / Notices 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 Section, 100 F Street, NE., Washington, DC 20549–1090 on official business days between the hours of 10 a.m. and 3 p.m. Copies of the filing will also 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– NYSEArca–2011–52 and should be submitted on or before September 1, 2011. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.29 Elizabeth M. Murphy, Secretary. [FR Doc. 2011–20389 Filed 8–10–11; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–65046; File No. SR–Phlx– 2011–105] Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Active SQF Port Fee srobinson on DSK4SPTVN1PROD with NOTICES August 5, 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 August 2, 2011, NASDAQ OMX PHLX LLC (‘‘Phlx’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I, II, 29 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 VerDate Mar<15>2010 15:59 Aug 10, 2011 Jkt 223001 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 The Exchange proposes to amend the Exchange’s Fee Schedule to extend the Active Specialized Quote Feed (‘‘SQF’’) Port Fee monthly cap from its current expiration of November 30, 2011 3 to December 30, 2011. The text of the proposed rule change is available on the Exchange’s Web site at https://nasdaqtrader.com/ micro.aspx?id=PHLXfilings, 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 aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 49821 ports refer to ports that receive inbound quotes at any time within that month. SQF is an interface that enables specialists, Streaming Quote Traders (‘‘SQTs’’) and Remote Streaming Quote Traders (‘‘RSQTs’’) to connect and send quotes into Phlx XL. The Exchange currently has a tiered Active SQF Port Fee as follows: Number of Active SQF Ports 0–4 .................................. 5–18 ................................ 19–40 .............................. 41 and over .................... Cost Per Port Per Month 350 1,250 2,350 3,000 Active SQF Port Fees are capped at $500 per month for member organizations that are (i) Phlx Only Members; 5 and (ii) have 50 or less SQT assignments affiliated with their member organization. Currently, Active SQF Port Fees are capped at $40,000 per month (‘‘Cap’’) until November 30, 2011 for all member organizations other than those member organizations who meet the requirements of the $500 per month cap. The purpose of the Cap is to ensure member organizations are not assessed fees in excess of the Active SQF Port Fees. The Exchange proposes to extend the Cap until December 30, 2011 because the Exchange believes that member organizations would require additional time to properly transition to SQF 6.0 ports. On January 2, 2012, there will no longer be a Cap in effect for the Active SQF Port Fee. No other changes are proposed with respect to Active SQF Port Fees. 1. Purpose The purpose of the proposed rule change is to extend the timeframe for member organizations to cap their Active SQF Port Fees in order that they will have additional time to transition from SQF 5.0 to SQF 6.0.4 Active SQF 2. Statutory Basis The Exchange believes that its proposal to amend its Fee Schedule is consistent with Section 6(b) of the Act 6 in general, and furthers the objectives of Section 6(b)(4) of the Act 7 in particular, in that it is an equitable allocation of reasonable fees and other charges among 3 See Securities Exchange Act Release No. 63780 (January 26, 2011), 76 FR 5846 (February 2, 2011) (SR–Phlx–2011–07). 4 The Exchange released SQF 6.0 on October 11, 2010. The Exchange anticipates that member organizations will utilize both SQF 5.0 and SQF 6.0 for a period of time. SQF 6.0 will increase efficiency for interested participants by allowing them to access in a single feed available to all participants, rather than through accessing multiple feeds, information such as execution reports and other relevant data. In order for participants to access all of this information currently or for any that do not use SQF 6.0 in the future, they must rely on a risk management feed and the TOPO/TOPO Plus Orders Exchange interfaces. Non quoting firms that would like to receive the relevant information available over SQF will be allowed to connect to the SQF interface, but not send quotes. Data proposed for SQF 6.0 will initially include the following: (1) Options Auction Notifications (e.g., opening imbalance, market exhaust, PIXL or other information currently provided on SQF 5.0); (2) Options Symbol Directory Messages (currently provided on SQF 5.0); (3) System Event Messages (e.g., start of messages, start of system hours, start of quoting, start of opening); (4) Complex Order Strategy Auction Notifications (COLA); (5) Complex Order Strategy messages; (6) Option Trading Action Messages (e.g., halts, resumes); and (7) Complex Strategy Trading Action Message (e.g., halts, resumes). See Securities Exchange Act Release No. 63034 (October 4, 2010), 75 FR 62441 (October 8, 2010) (SR–Phlx–2010–124). 5 For purposes of the Active SQF Port Fee, a Phlx Only Member is a Phlx member that is not a member or member organization of another national securities exchange. 6 15 U.S.C. 78f(b). 7 15 U.S.C. 78f(b)(4). PO 00000 Frm 00097 Fmt 4703 Sfmt 4703 E:\FR\FM\11AUN1.SGM 11AUN1

Agencies

[Federal Register Volume 76, Number 155 (Thursday, August 11, 2011)]
[Notices]
[Pages 49818-49821]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-20389]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-65048; File No. SR-NYSEArca-2011-52]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca 
Options Rule 6.90 To Permit Qualified Contingent Cross Orders To Be 
Electronically Submitted to the NYSE Arca System From the Floor of the 
Exchange for Potential Execution

August 5, 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 August 1, 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 prepared by the self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

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

    The Exchange proposes to amend NYSE Arca Options Rule 6.90 to 
permit Qualified Contingent Cross Orders (``QCCs'') to be 
electronically submitted to the NYSE Arca System from the Floor of the 
Exchange for potential execution.
    The text of the proposed rule change is available at the Exchange's 
Web site at https://www.nyse.com, on the Commission's Web site at https://www.sec.gov, at the Exchange'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 self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

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

1. Purpose
    The purpose of this filing is to amend Rule 6.90 to permit QCCs to 
be electronically submitted to the NYSE Arca System from the Floor of 
the Exchange for potential execution.\4\ This filing is modeled after a 
recently approved rule change by NASDAQ OMX PHLX (``PHLX'').\5\
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    \4\ The NYSE Arca System is configured to automatically reject a 
QCC entered when the order is for less than 1,000 contracts, is 
entered at a price worse than the national best bid or offer 
(``NBBO'') or is entered at the same price as Customer orders in the 
Exchange's Consolidated Book.
    \5\ See Securities Exchange Act Release No. 64688 (June 16, 
2011), 76 FR 36606 (June 22, 2011) (SR-Phlx-2011-56).
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Background
    The Exchange recently adopted rules that permit OTP Holders to 
submit QCCs electronically from off the Floor through the NYSE Arca 
System.\6\ The QCC permits an NYSE Arca OTP Holder to effect a 
qualified contingent trade (``QCT'') in a Regulation NMS stock and 
cross the options leg of the trade on the Exchange immediately upon 
entry and without order exposure if the order is for at least 1,000 
contracts, is part of a QCT, is executed at a price at least equal to 
the NBBO and if there are no Customer Orders in the Exchange's 
Consolidated Book at the same price.\7\
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    \6\ See Securities Exchange Act Release No. 64086 (March 17, 
2011), 76 FR 16021 (March 22, 2011) (SR-NYSEArca-2011-09) (``NYSE 
Arca Electronic QCC Filing'').
    \7\ A QCT is a transaction consisting of two or more component 
orders, executed as agent or principal, where: (a) At least one 
component is an NMS stock, as defined in Rule 600 of Regulation NMS 
under the Exchange Act; (b) all components are effected with a 
product or price contingency that either has been agreed to by all 
the respective counterparties or arranged for by a broker-dealer as 
principal or agent; (c) the execution of one component is contingent 
upon the execution of all other components at or near the same time; 
(d) the specific relationship between the component orders (e.g., 
the spread between the prices of the component orders) is determined 
by the time the contingent order is placed; (e) the component orders 
bear a derivative relationship to one another, represent different 
classes of shares of the same issuer, or involve the securities of 
participants in mergers or with intentions to merge that have been 
announced or cancelled; and (f) the transaction is fully hedged 
(without regard to any prior existing position) as a result of other 
components of the contingent trade. See Securities Exchange Act 
Release No. 57620 (April 4, 2008), 73 FR 19271 (April 9, 2008) (the 
``QCT Release''). That release superseded a release initially 
granting the QCT exemption. See Securities Exchange Act Release No. 
54389 (August 31, 2006), 71 FR 52829 (September 7, 2006) (``Original 
QCT Exemption'').
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    The NYSE Arca Electronic QCC Filing was based on an International 
Securities Exchange (``ISE'') rule approved by the Commission.\8\ The 
ISE QCC Proposal was controversial, attracting opposition from multiple 
exchanges including NYSE Arca.\9\ The Commission, however, ultimately 
approved the ISE QCC Proposal, finding it to be consistent with the 
Securities Exchange Act of 1934 (the ``Act''). NYSE Arca implemented 
the NYSE Arca Electronic QCC Filing, and is proposing this rule change, 
as a competitive response to the approval of the PHLX floor-based QCC 
filing.
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    \8\ See Securities Exchange Act Release No. 63955 (February 24, 
2011), 76 FR 11533 (March 2, 2011) (SR-ISE-2010-73) (``ISE 
Approval''). See also Securities Exchange Act Release No. 62523 
(July 16, 2010), 75 FR 43211 (July 23, 2010) (SR-ISE-2010-73) (``ISE 
QCC Proposal'').
    \9\ The Exchange notes that letters commenting on the ISE 
Proposal were submitted on its behalf by the Exchange's parent 
company, NYSE Euronext. See e.g., letters dated August 9, 2010 and 
October 21, 2010 from Janet L. McGinness, Senior Vice President--
Legal & Corporate Secretary, Legal & Government Affairs, NYSE 
Euronext.
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    Under the NYSE Arca Electronic QCC Filing, QCCs currently may only 
be submitted electronically from off the Floor through the NYSE Arca 
System. In this regard, OTP Holders on the Floor of the Exchange are 
not allowed to enter QCCs into the NYSE Arca System, or otherwise 
effect them in open outcry. To provide a mechanism for the Exchange to 
surveil for whether QCCs were entered from off of the Floor, the 
Exchange adopted Commentary .01 to Rule 6.90, which requires OTP 
Holders to maintain books and records demonstrating that each QCC was 
routed to the NYSE Arca System from off of the Floor. Presently, any 
QCC that does not have a corresponding record required by this 
provision would be deemed to have been entered from on the Floor in 
violation of Rule 6.90. In addition, the Exchange has adopted policies 
and procedures to ensure that OTP Holders use the QCC properly.\10\
---------------------------------------------------------------------------

    \10\ First, the Exchange requires OTP Holders to properly mark 
all QCCs as such. In addition, the Financial Industry Regulatory 
Authority (``FINRA''), on behalf of the Exchange, has implemented an 
examination and surveillance program to assess OTP Holder compliance 
with the requirements applicable to QCCs, including the requirement 
that the stock leg of the transaction be executed at or near the 
same time as the options leg.
---------------------------------------------------------------------------

Discussion
    QCCs permit OTP Holders to provide their customers a net price for 
the entire

[[Page 49819]]

trade, and then allow the OTP Holder to execute the options leg of the 
trade on the Exchange at a price at least equal to the NBBO while using 
the QCT exemption to effect the trade in the equities leg at a price 
necessary to achieve the net price.
    The Exchange hereby proposes to permit QCCs to be electronically 
entered from the Floor of the Exchange by Floor Brokers and executed 
immediately upon entry without exposure into the NYSE Arca System 
provided that no Customer Orders exist on the Exchange's Consolidated 
Book at the execution price, that the order is for at least 1,000 
contracts,\11\ and that the execution price is at or between the 
NBBO.\12\ QCCs entered from the Floor of the Exchange would be 
electronically entered into the NYSE Arca System by a Floor Broker.\13\ 
The impact of this proposal, coupled with the NYSE Arca Electronic QCC 
Filing, would be that OTP Holders would be able to enter QCCs both on 
and off of the Floor. The Exchange therefore proposes to eliminate the 
requirements from NYSE Arca Rule 6.90 that QCCs only be submitted 
electronically from off the Floor to the NYSE Arca System and from 
Commentary .01 to NYSE Arca Rule 6.90 that OTP Holders maintain books 
and records demonstrating that each QCC was routed to the NYSE Arca 
System from off of the Floor, as both will no longer be necessary if 
QCCs are available for entry from the Floor.
---------------------------------------------------------------------------

    \11\ In order to satisfy the 1,000-contract requirement, a QCC 
must be for 1,000 contracts and could not be, for example, two 500-
contract orders or two 500-contract legs.
    \12\ The Exchange does not propose to change the definition of 
``Qualified Contingent Cross Order'' in NYSE Arca Rule 6.62. Thus, 
like QCCs effected pursuant to the NYSE Arca Electronic QCC Filing, 
QCCs entered from the Floor would need to meet the requirements of 
NYSE Arca Rule 6.62 and Commentary .02 of that rule. Additionally, 
QCCs entered from the Floor by a Floor Broker would be entered 
electronically into the NYSE Arca System where a systemic check 
would be performed to determine whether a Customer Order is resting 
on the Exchange's Consolidated Book at the same price as the QCC, 
whether the order was for less than 1,000 contracts or whether the 
execution price would be outside the NBBO, each of which would cause 
the QCC to be rejected. If, however, the QCC is not rejected, then 
the NYSE Arca System would execute the QCC and simultaneously assign 
it an execution time.
    \13\ As proposed, only Floor Brokers would be permitted to enter 
QCCs from on the Floor and QCCs would not be permitted in open 
outcry.
---------------------------------------------------------------------------

    The Commission in the ISE Approval carefully considered the 
comparison between floor-based and electronic trading, including 
commissioning a study by the Division of Risk, Strategy and Financial 
Innovation (``RiskFin Study''). The RiskFin Study and the ISE Approval 
compare electronic trading and floor trading, the similarities between 
the two forms of trading, and the ability of one to replicate the 
other. Additionally, the Commission received comment letters from 
multiple floor-based exchanges that challenged the comparison that ISE 
drew between floor-based and electronic trading.
    Despite facing direct comparisons between floor-based trading and 
electronic trading by multiple commenters, as well as by its own 
Division of RiskFin, the ISE Approval focuses on similarities between 
the two. The Exchange believes that the ISE Approval, on its face, 
draws no distinctions and identifies no material differences between 
floor-based and electronic trading that would confound the comparison 
between cross orders entered electronically and those entered on an 
exchange floor. The Exchange believes that its proposal to permit the 
entry of QCCs from the Floor is consistent with the requirements stated 
in the ISE Approval and consistent with the Act. The Exchange also 
believes that the Commission, in issuing the ISE Approval, assumed that 
QCC orders entered on the floor of an exchange that meet the 
requirements stated in the ISE Approval are equally consistent with the 
Act.
    The Exchange has analyzed the application of Section 11(a) of the 
Act, and the rules thereunder, to QCCs entered from the Floor. Section 
11(a) and the rules thereunder generally prohibit members of an 
exchange from effecting transactions on the exchange for their own 
account, the account of an associated person, or an account with 
respect to which it or an associated person thereof exercises 
investment discretion unless an exemption applies.\14\ Section 11(a) 
contains multiple exemptions, including exemptions for dealers acting 
in the capacity of market makers, odd-lot dealers, and firms engaged in 
stabilizing conduct; there are also rule-based exemptions such as the 
``effect vs. execute'' exception under SEC Rule 11a2-2(T) under the 
Act.\15\
---------------------------------------------------------------------------

    \14\ See 15 U.S.C. 78k(a).
    \15\ See 17 CFR 240.11a2-2(T).
---------------------------------------------------------------------------

    The Exchange has in the past analyzed the application of Section 
11(a) to various Exchange systems and order types.\16\ The Exchange 
believes that the entry and execution of QCCs from the Floor raises no 
novel issues under Section 11(a) and the rules thereunder from a 
compliance, surveillance or enforcement perspective. In other words, 
OTP Holders on the Floor are currently required to comply and are 
subject to review for compliance with Section 11(a), and the rules 
thereunder, when using Exchange systems to effect transactions using 
existing order types, and they will be required to comply with Section 
11(a) and the rules thereunder when entering QCCs from the Floor.
---------------------------------------------------------------------------

    \16\ See, e.g. Securities Exchange Act Release No. 54238 (July 
28, 2006), 71 FR 44758 (August 7, 2006) (SR-NYSEArca-2006-13).
---------------------------------------------------------------------------

    Nonetheless, out of an abundance of caution, the Exchange proposes 
to amend Commentary .01 to NYSE Arca Rule 6.90 to prohibit Floor 
Brokers from entering QCCs from the Floor for their own accounts, the 
account of an associated person, or an account with respect to which it 
or an associated person thereof exercises investment discretion (each a 
``prohibited account'').\17\
---------------------------------------------------------------------------

    \17\ This restriction is the same as the one found in PHLX Rule 
1064(e)(2).
---------------------------------------------------------------------------

    These restrictions set forth in Commentary .01 to NYSE Arca Rule 
6.90 would not limit in any way the obligation of OTP Holders, on the 
Floor or otherwise, to comply with Section 11(a) or the rules 
thereunder. For example, Floor Brokers cannot avoid or circumvent their 
obligations under Section 11(a) with respect to a QCC entered from the 
Floor by transmitting that order to another OTP Holder on the Floor or 
to an OTP Holder off the Floor of the Exchange. Likewise, OTP Holders 
off the Floor must ensure that their QCCs comply with Section 11(a) and 
the rules thereunder. In both cases, OTP Holders must ensure compliance 
with Section 11(a) and the rules thereunder, including by relying upon 
an exemption such as those listed above.
    Additionally, to provide a mechanism for the Exchange to review 
whether QCCs have been entered properly by Floor Brokers, the Exchange 
proposes to further amend Commentary .01 to NYSE Arca Rule 6.90 to 
require OTP Holders on the Floor to maintain books and records 
demonstrating that no QCC was entered from the Floor by the OTP Holder 
in a prohibited account. Any QCC entered from the Floor that does not 
have a corresponding record required by this provision would be deemed 
to have been entered in violation of Commentary .01 to NYSE Arca Rule 
6.90.
    The Exchange also proposes to amend Commentary .01 to NYSE Arca 
Rule 6.90 to clarify that NYSE Arca Rule 6.47 does not apply when Floor 
Brokers are executing QCCs. The Exchange is making this clarification 
to eliminate any confusion about whether the various crossing 
provisions in Rule 6.47 may apply to QCCs when they are

[[Page 49820]]

executed by Floor Brokers.\18\ In addition, the Exchange is moving a 
recordkeeping obligation from current Commentary .01 to Commentary 02 
and modifying it to require that with respect to QCCs routed to the 
NYSE Arca System from off of the Floor, OTP Holders must maintain books 
and records demonstrating that each such order was routed to the system 
from off of the Floor.\19\ Finally, the Exchange is adding Commentary 
.03 to NYSE Arca Rule 6.90 to clarify that the order exposure 
requirements found in NYSE Arca Rule 6.47A do not apply to QCCs. That 
rule generally provides that with respect to orders routed to the NYSE 
Arca System, OTP Holders may not execute as principal orders they 
represent as agent unless such orders are first exposed on the Exchange 
for at least one second.
---------------------------------------------------------------------------

    \18\ This change is modeled after the changes to PHLX Rule 
1064(a), (b) and (c).
    \19\ The Exchange also is clarifying that Commentary .02 would 
not apply to a Qualified Contingent Cross Order covered by 
Commentary .01 to NYSE Arca Rule 6.90 (i.e., a Qualified Contingent 
Cross Order routed to a Floor Broker for entry into the NYSE Arca 
System).
---------------------------------------------------------------------------

    The Exchange's proposal addresses the mechanics of executing the 
stock and options components of a net-price transaction. The Exchange 
believes that it is necessary that it provide OTP Holders and their 
customers with the same trading capabilities available on other 
exchanges with respect to QCCs, including the change proposed herein, 
which would permit OTP Holders to execute the options legs of their 
customers' large complex orders on the Exchange.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
Section 6(b) of the Act,\20\ in general, and furthers the objectives of 
Section 6(b)(5) \21\ and 6(b)(8) of the Act,\22 \in particular, because 
it is designed to promote just and equitable principles of trade, 
remove impediments to and perfect the mechanisms of a free and open 
market and a national market system and, in general, to protect 
investors and the public interest and does not impose any burden on 
competition not necessary or appropriate in furtherance of the purposes 
of the Act. The proposed rule change is consistent with the protection 
of investors in that it is designed to prevent Trade-Throughs. In 
addition, the proposed rule change would promote a free and open market 
by permitting the Exchange to compete with other exchanges for these 
types of orders. In this regard, competition would result in benefits 
to the investing public, whereas a lack of competition would serve to 
limit the choices that the public has for execution of their options 
business.
---------------------------------------------------------------------------

    \20\ 15 U.S.C. 78f(b).
    \21\ 15 U.S.C. 78f(b)(5).
    \22\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    In addition, the proposed rule change is consistent with Section 
11A(a)(1)(C) of the Act,\23\ in which Congress found that it is in the 
public interest and appropriate for the protection of investors and the 
maintenance of fair and orderly markets to assure, among other things, 
the economically efficient execution of securities transactions. As 
described in detail above, the proposed rule change is also consistent 
with Section 11(a) of the Act and the rules thereunder.
---------------------------------------------------------------------------

    \23\ 15 U.S.C. 78k-1(a)(1)(C).
---------------------------------------------------------------------------

    The Exchange believes, similar to the Commission's basis for 
finding that ISE's QCC proposal was consistent with the Act, that 
permitting the entry of QCCs from the Floor ``would facilitate the 
execution of qualified contingent trades, for which the Commission 
found in the Original QCT Exemption to be of benefit to the market as a 
whole, contributing to the efficient functioning of the securities 
markets and the price discovery process.'' \24\ Further, permitting the 
entry of QCCs from the Floor ``would provide assurance to parties to 
stock-option [QCTs] that their hedge would be maintained by allowing 
the options component to be executed as a clean cross.'' \25\ In 
addition, like the ISE QCC Proposal, the Exchange's proposal to permit 
the entry of QCCs from the Floor ``is narrowly drawn and establishes a 
limited exception to the general principle of exposure, and retains the 
general principle of customer priority in the options markets.'' \26\
---------------------------------------------------------------------------

    \24\ See ISE Approval at 11540.
    \25\ Id.
    \26\ See ISE Approval at 11541.
---------------------------------------------------------------------------

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \27\ and Rule 19b-4(f)(6) thereunder.\28\ 
Because the 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 prior to 
30 days from the date on which it was filed, 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) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
---------------------------------------------------------------------------

    \27\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \28\ 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 complied with this requirement.
---------------------------------------------------------------------------

    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-NYSEArca-2011-52 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEArca-2011-52. This 
file number should be included on the subject line if e-mail is used. 
To help the Commission process and review your

[[Page 49821]]

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 Section, 100 F Street, NE., Washington, DC 20549-1090 on 
official business days between the hours of 10 a.m. and 3 p.m. Copies 
of the filing will also 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-NYSEArca-2011-52 and should be submitted on or before 
September 1, 2011.
---------------------------------------------------------------------------

    \29\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\29\
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-20389 Filed 8-10-11; 8:45 am]
BILLING CODE 8011-01-P
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