Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by International Securities Exchange To Amend ISE Rule 715 To Reflect a Modification in the Functionality of the Add Liquidity Order, 40935-40936 [2012-16877]
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Federal Register / Vol. 77, No. 133 / Wednesday, July 11, 2012 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Elizabeth M. Murphy,
Secretary.
the places specified in Item IV below.
The self-regulatory organization has
prepared summaries, set forth in
sections A, B and C below, of the most
significant aspects of such statements.
[FR Doc. 2012–16876 Filed 7–10–12; 8:45 am]
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–67353; File No. SR–ISE–
2012–61]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by
International Securities Exchange To
Amend ISE Rule 715 To Reflect a
Modification in the Functionality of the
Add Liquidity Order
July 5, 2012.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b-4 thereunder,2
notice is hereby given that on June 27,
2012, the International Securities
Exchange, LLC (the ‘‘Exchange’’ or the
‘‘ISE’’) 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 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
Rule 715 (Types of Orders) to reflect a
modification in the functionality of the
Add Liquidity Order and to rename the
order type.
The text of the proposed rule change
is available on the Exchange’s Internet
Web site at https://www.ise.com, at the
principal office of the Exchange, 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,
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
11 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
18:11 Jul 10, 2012
Jkt 226001
1. Purpose
The purpose of this proposed rule
change is [sic] amend ISE Rule 715(n),
Add Liquidity Order (‘‘ALO’’), to add a
sentence describing a change to the
functionality.3
The ALO was adopted to
accommodate investors and market
participants who wish only to provide
liquidity in certain circumstances, such
as to receive a maker fee (rebate) upon
execution of an order. ALOs are limit
orders that will only be executed as a
‘‘maker’’ on the ISE. Members can
choose whether an ALO that is
executable on the ISE upon entry (or
that locks or crosses an away market
upon entry) will be cancelled or repriced to one minimum price variation
above the national best bid or below the
national best offer. For an ALO to be
accepted by the system the Member
must designate whether the order shall
be re-priced or cancelled; there is no
default option. An Add Liquidity Order
will only be re-priced once and will be
executed at the re-priced price.
The Exchange is now proposing
additional functionality, such that, if at
the time of entry, an ALO would lock
or cross one or more non-displayed
orders on the Exchange, the ALO will be
cancelled or re-priced to the minimum
price variation above the best nondisplayed bid price (for sell orders) or
below the best non-displayed offer price
(for buy orders).4 Currently, the only
type of non-displayed order available on
the Exchange is the all-or-none order
(‘‘AON’’). AONs are contingency orders
that have no priority on the book,5 are
not included in the ISE best bid or offer
and, as such, are not included in the
national best bid or offer (‘‘NBBO’’).
3 ALOs have not yet been implemented on the
Exchange. While the rule change adopting the ALO
became operative on April 6, 2012, the
implementation date for the order type was delayed
until such time as the technology incorporating this
functionality was released. See Securities Exchange
Act Release No. 66617 (March 19, 2012), 77 FR
17102 (March 23, 2012) (Notice of Filing and
Immediate Effectiveness of SR–ISE–2012–20).
4 For example, if the NBBO is 2.00 x 2.06 and
there is a non-displayed all-or-none (‘‘AON’’) order
(due to the size contingency, AON orders are not
displayed) on the book to sell 10 contracts at 2.05,
an incoming ALO to buy 10 contracts at 2.06 will
be re-priced to 2.04.
5 See Supplemental Material .02 to ISE Rule 713.
PO 00000
Frm 00090
Fmt 4703
Sfmt 4703
40935
AONs are considered to be ‘‘nondisplayed’’ because they are not
disseminated to OPRA to be included in
the NBBO. However, they are not truly
a ‘‘non-displayed’’ order as AONs are
disseminated via the ISE Order Feed
which Members can subscribe to for a
fee.6 Accordingly, Members entering
AONs do not have an expectation that
their order is ‘‘non-displayed’’ and
would not have concerns that the ALO
could disclose the existence of the AON
by re-pricing to one minimum price
variation above the AON bid price or
below the AON offer price as Members
have access to the existence of AONs via
the ISE Order Feed.
The Exchange believes that adding
this functionality is imperative to
ensure that ALOs are only executed
when providing liquidity. Without the
ability to re-price an ALO that locks or
crosses a non-displayed order, under
certain circumstances, an incoming
ALO could execute against a nondisplayed order resting on the ISE limit
order book, which would be in direct
contravention with the purpose of an
ALO—to provide liquidity, not take
liquidity.
Additionally, for branding and
marketing purposes, the Exchange
proposes to rename the ‘‘Add Liquidity
Order’’ to the ‘‘Add Liquidity Only’’
order.
As the implementation date for this
order is not certain, the Exchange will
announce the specific operative date via
an Information Circular.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the provisions of Section 6 of the Act,7
in general, and with Section 6(b)(5) of
the Act,8 in particular, in that the
proposal 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, in general, to protect
investors and the public interest.
Specifically, the ALO order is designed
to provide market participants with the
ability to provide liquidity and have
more control over their execution costs.
When an ALO would lock or cross a
non-displayed order on the ISE limit
6 See
ISE Schedule of Fees.
U.S.C. 78f.
8 15 U.S.C. 78f(b)(5).
7 15
E:\FR\FM\11JYN1.SGM
11JYN1
40936
Federal Register / Vol. 77, No. 133 / Wednesday, July 11, 2012 / Notices
order book or be executed upon entry,
it will either be cancelled or re-priced
as designated. The only non-displayed
order type that the Exchange offers is
the all-or-none order, which is nondisplayed in the sense that it is not
included in the ISE best bid and offer,
and therefore, is not included in the
NBBO. However, AONs are
disseminated via the ISE Order Feed,
allowing market participants to know of
the existence of the AONs and thereby
removing any expectation that AONs are
truly non-displayed. Accordingly,
Members entering AONs do not have an
expectation that their AON is nondisplayed and would not have concerns
that this modification of the ALO’s
functionality could provide market
participants with the ability to ferret out
AONs on the ISE limit order book which
would otherwise be hidden.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The proposed rule change does not
impose any burden on competition that
is not necessary or appropriate in
furtherance of the purposes of the Act.
srobinson on DSK4SPTVN1PROD with NOTICES
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
members or other interested parties.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not significantly affect the
protection of investors or the public
interest, does not impose any significant
burden on competition, and, by its
terms, does not become operative for 30
days from the date on which it was
filed, or such shorter time as the
Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) 9 of the Act and Rule 19b–
4(f)(6) 10 thereunder. The Exchange
provided the Commission with written
notice of its intent to file the proposed
rule change, along with a brief
description and text of the proposed
rule change, at least five business days
prior to the date of filing the proposed
rule change.
At any time within 60 days of the
filing of the proposed rule change, the
Commission may temporarily suspend
9 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
10 17
VerDate Mar<15>2010
18:11 Jul 10, 2012
Jkt 226001
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.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Elizabeth M. Murphy,
Secretary.
IV. Solicitation of Comments
BILLING CODE 8011–01–P
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 Email to rulecomments@sec.gov. Please include File
No. SR–ISE–2012–61 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–ISE–2012–61. This file
number should be included on the
subject line if email 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 Commissions
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549. Copies of such
filing also will be available for
inspection and copying at the principal
office of the ISE. 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–ISE–
2012–61 and should be submitted by
August 1, 2012.
PO 00000
Frm 00091
Fmt 4703
Sfmt 4703
[FR Doc. 2012–16877 Filed 7–10–12; 8:45 am]
DEPARTMENT OF STATE
[Public Notice 7952]
60-Day Notice of Proposed Information
Collection: Passport Demand
Forecasting Study Phase III
Notice of request for public
comments.
ACTION:
The Department of State is
seeking Office of Management and
Budget (OMB) approval for the
information collection described below.
The purpose of this notice is to allow 60
days for public comment in the Federal
Register preceding submission to OMB.
We are conducting this process in
accordance with the Paperwork
Reduction Act of 1995.
• Title of Information Collection:
Passport Demand Forecasting Study
Phase III.
• OMB Control Number: None.
• Type of Request: Reinstatement of a
previous collection.
• Originating Office: Bureau of
Consular Affairs/Passport Services (CA/
PPT)
• Form Number: SV–2012–0006.
• Respondents: A national
representative sample of U.S. Citizens,
Nationals, and any other categories of
individuals that are entitled to a U.S.
Passport product.
• Estimated Number of Respondents:
4,000 survey respondents per month.
• Estimated Number of Responses:
48,000 survey respondents per annually.
• Average Hours Per Response: 10
minutes per survey.
• Total Estimated Burden: 8,000
hours annually.
• Frequency: Monthly.
• Obligation to Respond: Voluntary.
DATES: The Department will accept
comments from the public up to 60 days
from July 11, 2012.
ADDRESSES: You must include the DS
form number (if applicable), information
collection title, and OMB control
number in any correspondence.
FOR FURTHER INFORMATION CONTACT:
Send direct requests for additional
information regarding the collection
listed in this notice, including requests
for copies of the proposed information
SUMMARY:
11 17
E:\FR\FM\11JYN1.SGM
CFR 200.30–3(a)(12).
11JYN1
]]>Agencies
[Federal Register Volume 77, Number 133 (Wednesday, July 11, 2012)]
[Notices]
[Pages 40935-40936]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-16877]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-67353; File No. SR-ISE-2012-61]
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by International Securities
Exchange To Amend ISE Rule 715 To Reflect a Modification in the
Functionality of the Add Liquidity Order
July 5, 2012.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on June 27, 2012, the International Securities Exchange, LLC (the
``Exchange'' or the ``ISE'') 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 self-
regulatory organization. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Rule 715 (Types of Orders) to
reflect a modification in the functionality of the Add Liquidity Order
and to rename the order type.
The text of the proposed rule change is available on the Exchange's
Internet Web site at https://www.ise.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in sections A, B and C below, of the
most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of this proposed rule change is [sic] amend ISE Rule
715(n), Add Liquidity Order (``ALO''), to add a sentence describing a
change to the functionality.\3\
---------------------------------------------------------------------------
\3\ ALOs have not yet been implemented on the Exchange. While
the rule change adopting the ALO became operative on April 6, 2012,
the implementation date for the order type was delayed until such
time as the technology incorporating this functionality was
released. See Securities Exchange Act Release No. 66617 (March 19,
2012), 77 FR 17102 (March 23, 2012) (Notice of Filing and Immediate
Effectiveness of SR-ISE-2012-20).
---------------------------------------------------------------------------
The ALO was adopted to accommodate investors and market
participants who wish only to provide liquidity in certain
circumstances, such as to receive a maker fee (rebate) upon execution
of an order. ALOs are limit orders that will only be executed as a
``maker'' on the ISE. Members can choose whether an ALO that is
executable on the ISE upon entry (or that locks or crosses an away
market upon entry) will be cancelled or re-priced to one minimum price
variation above the national best bid or below the national best offer.
For an ALO to be accepted by the system the Member must designate
whether the order shall be re-priced or cancelled; there is no default
option. An Add Liquidity Order will only be re-priced once and will be
executed at the re-priced price.
The Exchange is now proposing additional functionality, such that,
if at the time of entry, an ALO would lock or cross one or more non-
displayed orders on the Exchange, the ALO will be cancelled or re-
priced to the minimum price variation above the best non-displayed bid
price (for sell orders) or below the best non-displayed offer price
(for buy orders).\4\ Currently, the only type of non-displayed order
available on the Exchange is the all-or-none order (``AON''). AONs are
contingency orders that have no priority on the book,\5\ are not
included in the ISE best bid or offer and, as such, are not included in
the national best bid or offer (``NBBO''). AONs are considered to be
``non-displayed'' because they are not disseminated to OPRA to be
included in the NBBO. However, they are not truly a ``non-displayed''
order as AONs are disseminated via the ISE Order Feed which Members can
subscribe to for a fee.\6\ Accordingly, Members entering AONs do not
have an expectation that their order is ``non-displayed'' and would not
have concerns that the ALO could disclose the existence of the AON by
re-pricing to one minimum price variation above the AON bid price or
below the AON offer price as Members have access to the existence of
AONs via the ISE Order Feed.
---------------------------------------------------------------------------
\4\ For example, if the NBBO is 2.00 x 2.06 and there is a non-
displayed all-or-none (``AON'') order (due to the size contingency,
AON orders are not displayed) on the book to sell 10 contracts at
2.05, an incoming ALO to buy 10 contracts at 2.06 will be re-priced
to 2.04.
\5\ See Supplemental Material .02 to ISE Rule 713.
\6\ See ISE Schedule of Fees.
---------------------------------------------------------------------------
The Exchange believes that adding this functionality is imperative
to ensure that ALOs are only executed when providing liquidity. Without
the ability to re-price an ALO that locks or crosses a non-displayed
order, under certain circumstances, an incoming ALO could execute
against a non-displayed order resting on the ISE limit order book,
which would be in direct contravention with the purpose of an ALO--to
provide liquidity, not take liquidity.
Additionally, for branding and marketing purposes, the Exchange
proposes to rename the ``Add Liquidity Order'' to the ``Add Liquidity
Only'' order.
As the implementation date for this order is not certain, the
Exchange will announce the specific operative date via an Information
Circular.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\7\ in general, and with
Section 6(b)(5) of the Act,\8\ in particular, in that the proposal 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, in general, to
protect investors and the public interest. Specifically, the ALO order
is designed to provide market participants with the ability to provide
liquidity and have more control over their execution costs. When an ALO
would lock or cross a non-displayed order on the ISE limit
[[Page 40936]]
order book or be executed upon entry, it will either be cancelled or
re-priced as designated. The only non-displayed order type that the
Exchange offers is the all-or-none order, which is non-displayed in the
sense that it is not included in the ISE best bid and offer, and
therefore, is not included in the NBBO. However, AONs are disseminated
via the ISE Order Feed, allowing market participants to know of the
existence of the AONs and thereby removing any expectation that AONs
are truly non-displayed. Accordingly, Members entering AONs do not have
an expectation that their AON is non-displayed and would not have
concerns that this modification of the ALO's functionality could
provide market participants with the ability to ferret out AONs on the
ISE limit order book which would otherwise be hidden.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f.
\8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not significantly
affect the protection of investors or the public interest, does not
impose any significant burden on competition, and, by its terms, does
not become operative for 30 days from the date on which it was filed,
or such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) \9\ of the Act and Rule 19b-
4(f)(6) \10\ thereunder. The Exchange provided the Commission with
written notice of its intent to file the proposed rule change, along
with a brief description and text of the proposed rule change, at least
five business days prior to the date of filing the proposed rule
change.
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission 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 Email to rule-comments@sec.gov. Please include
File No. SR-ISE-2012-61 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-ISE-2012-61. This file
number should be included on the subject line if email 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 Commissions Internet Web site (https://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for Web site viewing and printing in
the Commission's Public Reference Room, 100 F Street NE., Washington,
DC 20549. Copies of such filing also will be available for inspection
and copying at the principal office of the ISE. 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-ISE-2012-61 and should be submitted by
August 1, 2012.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
---------------------------------------------------------------------------
\11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2012-16877 Filed 7-10-12; 8:45 am]
BILLING CODE 8011-01-P
