Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend the Pilot Period of the Trading Pause for NMS Stocks Other Than Rights and Warrants, 47448-47450 [2012-19353]
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47448
Federal Register / Vol. 77, No. 153 / Wednesday, August 8, 2012 / Notices
as the Commission may designate up to
90 days of such date if it finds such
longer period to be appropriate and
publishes its reasons for so finding, or
(ii) as to which the self-regulatory
organization consents, the Commission
will:
A. By order approve or disapprove the
proposed rule change; or
B. Institute proceedings to determine
whether the proposed rule change
should be 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:
wreier-aviles on DSK7SPTVN1PROD with NOTICES
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
Number SR–BATS–2012–030 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–BATS–2012–030. 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 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, on official
business days between 10:00 a.m. and
3:00 p.m. Copies of the filing will also
be available for inspection and copying
at the Exchange’s principal office. All
comments received will be posted
without change; the Commission does
not edit personal identifying
VerDate Mar<15>2010
15:11 Aug 07, 2012
Jkt 226001
information from submissions. You
should submit only information that
you wish to make available publicly. All
submissions should refer to File
Number SR–BATS–2012–030 and
should be submitted on or before
August 29, 2012.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.19
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2012–19350 Filed 8–7–12; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–67571; File No. SR–BX–
2012–055]
Self-Regulatory Organizations;
NASDAQ OMX BX, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Extend the
Pilot Period of the Trading Pause for
NMS Stocks Other Than Rights and
Warrants
August 2, 2012.
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 July 19,
2012, NASDAQ OMX BX, Inc.
(‘‘Exchange’’), filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The 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 extend the
pilot period of the trading pause for
individual NMS stocks other than rights
and warrants, so that the pilot will now
expire on February 4, 2013.
The text of the proposed rule change
is below. Proposed new language is in
italics; proposed deletions are in
brackets.
*
*
*
*
*
IM–4120–3. Circuit Breaker Securities Pilot
The provisions of paragraph (a)(11) of this
Rule shall be in effect during a pilot set to
end on February 4, 2013 [July 31, 2012].
During the pilot, the term ‘‘Circuit Breaker
19 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
PO 00000
Frm 00091
Fmt 4703
Sfmt 4703
Securities’’ shall mean all NMS stocks except
rights and warrants.
*
*
*
*
*
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 the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
On June 10, 2010, the Commission
granted accelerated approval for a pilot
period to end December 10, 2010, for a
proposed rule change submitted by the
Exchange, together with related rule
changes of the BATS Exchange, Inc.,
Chicago Board Options Exchange,
Incorporated, Chicago Stock Exchange,
Inc., EDGA Exchange, Inc., EDGX
Exchange, Inc., International Securities
Exchange LLC, The NASDAQ Stock
Market LLC (‘‘NASDAQ’’), New York
Stock Exchange LLC (‘‘NYSE’’), NYSE
MKT LLC (‘‘NYSE MKT’’) (formerly,
NYSE Amex LLC), NYSE Arca, Inc.
(‘‘NYSE Arca’’), and National Stock
Exchange, Inc. (collectively, the
‘‘Exchanges’’), to pause trading during
periods of extraordinary market
volatility in S&P 500 stocks.3 The rules
require the Listing Markets 4 to issue
five-minute trading pauses for
individual securities for which they are
the primary Listing Market if the
transaction price of the security moves
ten percent or more from a price in the
preceding five-minute period. The
Listing Markets are required to notify
the other Exchanges and market
participants of the imposition of a
trading pause by immediately
disseminating a special indicator over
the consolidated tape. Under the rules,
once the Listing Market issues a trading
pause, the other Exchanges are required
to pause trading in the security on their
markets. On September 10, 2010, the
3 Securities Exchange Act Release No. 62252
(June 10, 2010), 75 FR 34186 (June 16, 2010) (SR–
BX–2010–037).
4 The term ‘‘Listing Markets’’ refers collectively to
NYSE, NYSE MKT, NYSE Arca, and the Exchange.
E:\FR\FM\08AUN1.SGM
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Federal Register / Vol. 77, No. 153 / Wednesday, August 8, 2012 / Notices
wreier-aviles on DSK7SPTVN1PROD with NOTICES
Commission approved the respective
rule filings of the Exchanges to expand
application of the pilot to the Russell
1000® Index and specified Exchange
Traded Products.5 On December 7,
2010, the Exchange filed an
immediately effective filing to extend
the existing pilot program for four
months, so that the pilot would expire
on April 11, 2011.6 On March 31, 2011,
the Exchange filed an immediately
effective filing to extend the pilot period
an additional four months, so that the
pilot would expire on August 11, 2011
or the date on which a limit up/limit
down mechanism to address
extraordinary market volatility, if
adopted, applies.7 On June 23, 2011, the
Commission approved the expansion of
the pilot to all NMS stocks, but with
different pause-triggering thresholds.8
On August 8, 2011, the Exchange filed
an immediately effective filing that
removed language from the rule that
tied the expiration of the pilot to the
adoption of a limit up/limit down
mechanism to address extraordinary
market volatility, and further extended
the pilot period, so that the pilot would
expire on January 31, 2012.9 On
November 18, 2011, the Exchange filed
an immediately effective filing that
excluded rights and warrants from the
pilot.10 On January 23, 2012, the
Commission approved an extension of
the pilot to July 31, 2012.11
On May 31, 2012, the Commission
approved, on a pilot basis, the National
Market System Plan to Address
Extraordinary Market Volatility.12 This
plan creates a market-wide limit uplimit down mechanism that is intended
to address extraordinary market
volatility in NMS Stocks, which will be
implemented on February 4, 2013. Once
implemented, the limit up/limit down
mechanism to address extraordinary
market volatility will render the current
5 Securities Exchange Act Release No. 62884
(September 10, 2010), 75 FR 56618 (September 16,
2010) (SR–BX–2010–044).
6 Securities Exchange Act Release No. 63527
(December 10, 2010), 75 FR 78781 (December 16,
2010) (SR–BX–2010–088).
7 Securities Exchange Act Release No. 64176
(April 4, 2011), 76 FR 19821 (April 8, 2011) (SR–
BX–2011–018).
8 Securities Exchange Act Release No. 64735
(June 23, 2011), 76 FR 38243 (June 29, 2011) (SR–
BX–2011–025, et al.).
9 Securities Exchange Act Release No. 65093
(August 10, 2011), 76 FR 50781 (August 16, 2011)
(SR–BX–2011–055).
10 Securities Exchange Act Release No. 65815
(November 23, 2011), 76 FR 74109 (November 30,
2011) (SR–BX–2011–079).
11 Securities Exchange Act Release No. 66215
(January 23, 2012), 77 FR 4387 (January 27, 2012)
(SR–BX–2012–003).
12 Securities Exchange Act Release No. 67091
(May 31, 2012), 77 FR 33498 (June 6, 2012).
VerDate Mar<15>2010
15:11 Aug 07, 2012
Jkt 226001
stock trading pause pilot duplicative
and unnecessary. Accordingly, the
Exchange is proposing to extend the
single stock trading pause pilot so that
it will now expire on February 4, 2013,
when the limit up/limit down
mechanism to address extraordinary
market volatility is to be implemented.
The Exchange believes that the pilot
program has been successful in reducing
the negative impacts of sudden,
unanticipated price movements in the
securities covered by the pilot. The
Exchange also believes that an
additional extension of the pilot is
warranted so that it may continue to
apply the circuit breaker to reduce the
negative impacts of sudden,
unanticipated price movements until it
is replaced by the limit up/limit down
mechanism.
2. Statutory Basis
The statutory basis for the proposed
rule change is Section 6(b)(5) of the
Act,13 which requires the rules of an
exchange to promote just and equitable
principles of trade, to remove
impediments to and perfect the
mechanism of a free and open market
and a national market system and, in
general, to protect investors and the
public interest. The proposed rule
change also is designed to support the
principles of Section 11A(a)(1) 14 of the
Act in that it seeks to assure fair
competition among brokers and dealers
and among exchange markets. The
Exchange believes that the proposed
rule meets these requirements in that it
promotes transparency and uniformity
across markets concerning decisions to
pause trading in a security when there
are significant price movements. In
addition, the Exchange believes
extending the pilot to February 4, 2013
is consistent with the requirement to
protect investors because it will permit
the circuit breaker to continue to reduce
the negative impacts of sudden,
unanticipated price movements until it
is replaced by the preferred limit up/
limit down mechanism.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will result in
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act, as amended.
13 15
14 15
PO 00000
U.S.C. 78f(b)(5).
U.S.C. 78k–1(a)(1).
Frm 00092
Fmt 4703
47449
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
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 15 and Rule
19b–4(f)(6) thereunder.16 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 17 and Rule 19b–4(f)(6)(iii)
thereunder.18
A proposed rule change filed under
Rule 19b–4(f)(6) 19 normally does not
become operative for 30 days after the
date of filing. However, pursuant to
Rule 19b–4(f)(6)(iii) 20 the Commission
may designate a shorter time if such
action is consistent with the protection
of investors and the public interest. The
Exchange has asked the Commission to
waive the 30-day operative delay so that
the proposal may become operative
immediately upon filing.
The Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest, as it
will allow the pilot program to continue
uninterrupted, thereby avoiding the
investor confusion that could result
from a temporary interruption in the
pilot program. For this reason, the
Commission designates the proposed
rule change to be operative upon
filing.21
15 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
17 15 U.S.C. 78s(b)(3)(A).
18 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the Exchange to give the
Commission written notice of the Exchange’s intent
to file the proposed rule change along with a brief
description and text of the proposed rule change,
at least five business days prior to the date of filing
of the proposed rule change, or such shorter time
as designated by the Commission. The Exchange
has satisfied this requirement.
19 17 CFR 240.19b–4(f)(6).
20 17 CFR 240.19b–4(f)(6)(iii).
21 For purposes only of waiving the 30-day
operative delay, the Commission has also
considered the proposed rule’s impact on
16 17
Continued
Sfmt 4703
E:\FR\FM\08AUN1.SGM
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47450
Federal Register / Vol. 77, No. 153 / Wednesday, August 8, 2012 / Notices
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.
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:
wreier-aviles on DSK7SPTVN1PROD with NOTICES
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–BX–2012–055 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 No.
SR–BX–2012–055. 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 Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 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
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
VerDate Mar<15>2010
15:11 Aug 07, 2012
Jkt 226001
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File No. SR–BX–2012–
055 and should be submitted on or
before August 29, 2012.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.22
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2012–19353 Filed 8–7–12; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–67574; File No. SR–CBOE–
2012–0690]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Related to the Extension
of the CBSX Individual Stock Trading
Pause Pilot Program
August 2, 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 July 20,
2012, the Chicago Board Options
Exchange, Incorporated (‘‘Exchange’’ or
‘‘CBOE’’) 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 Exchange. The Exchange has
designated the proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A) of the
Act 3 and Rule 19b–4(f)(6) thereunder.4
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 extend the
individual stock trading pause pilot
program pertaining to the CBOE Stock
Exchange, LLC (‘‘CBSX,’’ the CBOE’s
stock trading facility). This rule change
simply seeks to extend the pilot. No
other changes to the pilot are being
proposed. The text of the proposed rule
change is available on the Exchange’s
22 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(6).
1 15
PO 00000
Frm 00093
Fmt 4703
Sfmt 4703
Web site (www.cboe.org/Legal), at the
Exchange’s Office of the Secretary and
at the Commission.
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 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
Rule 6.3C, Individual Stock Trading
Pauses Due to Extraordinary Market
Volatility, was approved by the
Commission on June 10, 2010 on a pilot
basis. The pilot is currently set to expire
on July 31, 2012.5 The rule was
developed in consultation with U.S.
listing markets to provide for uniform
market-wide trading pause standards for
certain individual stocks that
experience rapid price movement.6 As
the duration of the pilot expires on July
31, 2012, the Exchange is proposing to
5 See Securities Exchange Act Release Nos. 62252
(June 10, 2010), 75 FR 34186 (June 16, 2010) (SR–
CBOE–2010–047) (approval order establishing pilot
through December 10, 2010); 63502 (December 9,
2010), 75 FR 78306 (December 15, 2010) (SR–
CBOE–2010–112) (extension of pilot through April
11, 2011); 64194 (April 5, 2011), 76 FR 2–389 (April
12, 2011) (SR–CBOE–2011–031) (extension of pilot
through the earlier of August 11, 2011 or the date
on which a limit up-limit down mechanism to
address extraordinary market volatility, if adopted,
applies to the Circuit Breaker Stocks); 65070
(August 9, 2011), 76 FR 50516 (August 15, 2011)
(SR–CBOE–2011–076) (extension of pilot through
January 31, 2012); and 66166 (January 17, 2012), 77
FR 3311 (January 23, 2012) (extension of pilot
through July 31, 2012).
6 The pilot list of stocks originally included all
stocks in the S&P 500 Index, but it has been
expanded over time to include all NMS stocks,
other than rights and warrants. See Securities
Exchange Act Release Nos. 62884 (September 10,
2010), 75 FR 56618 (September 16, 2010) (SR–
CBOE–2010–065) (order approving expansion of the
individual stock trading pause pilot to include all
stocks in the Russell 1000 index and a pilot list of
Exchange Traded Products); 64735 (June 23, 2011),
76 FR 38243 (June 29, 2011) (SR–CBOE–2011–049)
(order approving further expansion of the
individual stock trading pause pilot to include all
NMS stocks effective August 8, 2011); and 65824
(November 23, 2011), 76 FR 74111 (November 30,
2011) (SR–CBOE–2011–111) (immediately effective
rule change to amend the individual stock trading
pause pilot to exclude all rights and warrants).
E:\FR\FM\08AUN1.SGM
08AUN1
Agencies
[Federal Register Volume 77, Number 153 (Wednesday, August 8, 2012)]
[Notices]
[Pages 47448-47450]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-19353]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-67571; File No. SR-BX-2012-055]
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Extend
the Pilot Period of the Trading Pause for NMS Stocks Other Than Rights
and Warrants
August 2, 2012.
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 July 19, 2012, NASDAQ OMX BX, Inc. (``Exchange''), filed with the
Securities and Exchange Commission (``Commission'') the proposed rule
change as described in Items I and II below, which Items have been
prepared by the Exchange. The 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 extend the pilot period of the trading
pause for individual NMS stocks other than rights and warrants, so that
the pilot will now expire on February 4, 2013.
The text of the proposed rule change is below. Proposed new
language is in italics; proposed deletions are in brackets.
* * * * *
IM-4120-3. Circuit Breaker Securities Pilot
The provisions of paragraph (a)(11) of this Rule shall be in
effect during a pilot set to end on February 4, 2013 [July 31,
2012]. During the pilot, the term ``Circuit Breaker Securities''
shall mean all NMS stocks except rights and warrants.
* * * * *
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 the
Statutory Basis for, the Proposed Rule Change
1. Purpose
On June 10, 2010, the Commission granted accelerated approval for a
pilot period to end December 10, 2010, for a proposed rule change
submitted by the Exchange, together with related rule changes of the
BATS Exchange, Inc., Chicago Board Options Exchange, Incorporated,
Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc.,
International Securities Exchange LLC, The NASDAQ Stock Market LLC
(``NASDAQ''), New York Stock Exchange LLC (``NYSE''), NYSE MKT LLC
(``NYSE MKT'') (formerly, NYSE Amex LLC), NYSE Arca, Inc. (``NYSE
Arca''), and National Stock Exchange, Inc. (collectively, the
``Exchanges''), to pause trading during periods of extraordinary market
volatility in S&P 500 stocks.\3\ The rules require the Listing Markets
\4\ to issue five-minute trading pauses for individual securities for
which they are the primary Listing Market if the transaction price of
the security moves ten percent or more from a price in the preceding
five-minute period. The Listing Markets are required to notify the
other Exchanges and market participants of the imposition of a trading
pause by immediately disseminating a special indicator over the
consolidated tape. Under the rules, once the Listing Market issues a
trading pause, the other Exchanges are required to pause trading in the
security on their markets. On September 10, 2010, the
[[Page 47449]]
Commission approved the respective rule filings of the Exchanges to
expand application of the pilot to the Russell 1000[supreg] Index and
specified Exchange Traded Products.\5\ On December 7, 2010, the
Exchange filed an immediately effective filing to extend the existing
pilot program for four months, so that the pilot would expire on April
11, 2011.\6\ On March 31, 2011, the Exchange filed an immediately
effective filing to extend the pilot period an additional four months,
so that the pilot would expire on August 11, 2011 or the date on which
a limit up/limit down mechanism to address extraordinary market
volatility, if adopted, applies.\7\ On June 23, 2011, the Commission
approved the expansion of the pilot to all NMS stocks, but with
different pause-triggering thresholds.\8\ On August 8, 2011, the
Exchange filed an immediately effective filing that removed language
from the rule that tied the expiration of the pilot to the adoption of
a limit up/limit down mechanism to address extraordinary market
volatility, and further extended the pilot period, so that the pilot
would expire on January 31, 2012.\9\ On November 18, 2011, the Exchange
filed an immediately effective filing that excluded rights and warrants
from the pilot.\10\ On January 23, 2012, the Commission approved an
extension of the pilot to July 31, 2012.\11\
---------------------------------------------------------------------------
\3\ Securities Exchange Act Release No. 62252 (June 10, 2010),
75 FR 34186 (June 16, 2010) (SR-BX-2010-037).
\4\ The term ``Listing Markets'' refers collectively to NYSE,
NYSE MKT, NYSE Arca, and the Exchange.
\5\ Securities Exchange Act Release No. 62884 (September 10,
2010), 75 FR 56618 (September 16, 2010) (SR-BX-2010-044).
\6\ Securities Exchange Act Release No. 63527 (December 10,
2010), 75 FR 78781 (December 16, 2010) (SR-BX-2010-088).
\7\ Securities Exchange Act Release No. 64176 (April 4, 2011),
76 FR 19821 (April 8, 2011) (SR-BX-2011-018).
\8\ Securities Exchange Act Release No. 64735 (June 23, 2011),
76 FR 38243 (June 29, 2011) (SR-BX-2011-025, et al.).
\9\ Securities Exchange Act Release No. 65093 (August 10, 2011),
76 FR 50781 (August 16, 2011) (SR-BX-2011-055).
\10\ Securities Exchange Act Release No. 65815 (November 23,
2011), 76 FR 74109 (November 30, 2011) (SR-BX-2011-079).
\11\ Securities Exchange Act Release No. 66215 (January 23,
2012), 77 FR 4387 (January 27, 2012) (SR-BX-2012-003).
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On May 31, 2012, the Commission approved, on a pilot basis, the
National Market System Plan to Address Extraordinary Market
Volatility.\12\ This plan creates a market-wide limit up-limit down
mechanism that is intended to address extraordinary market volatility
in NMS Stocks, which will be implemented on February 4, 2013. Once
implemented, the limit up/limit down mechanism to address extraordinary
market volatility will render the current stock trading pause pilot
duplicative and unnecessary. Accordingly, the Exchange is proposing to
extend the single stock trading pause pilot so that it will now expire
on February 4, 2013, when the limit up/limit down mechanism to address
extraordinary market volatility is to be implemented.
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\12\ Securities Exchange Act Release No. 67091 (May 31, 2012),
77 FR 33498 (June 6, 2012).
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The Exchange believes that the pilot program has been successful in
reducing the negative impacts of sudden, unanticipated price movements
in the securities covered by the pilot. The Exchange also believes that
an additional extension of the pilot is warranted so that it may
continue to apply the circuit breaker to reduce the negative impacts of
sudden, unanticipated price movements until it is replaced by the limit
up/limit down mechanism.
2. Statutory Basis
The statutory basis for the proposed rule change is Section 6(b)(5)
of the Act,\13\ which requires the rules of an exchange to promote just
and equitable principles of trade, to remove impediments to and perfect
the mechanism of a free and open market and a national market system
and, in general, to protect investors and the public interest. The
proposed rule change also is designed to support the principles of
Section 11A(a)(1) \14\ of the Act in that it seeks to assure fair
competition among brokers and dealers and among exchange markets. The
Exchange believes that the proposed rule meets these requirements in
that it promotes transparency and uniformity across markets concerning
decisions to pause trading in a security when there are significant
price movements. In addition, the Exchange believes extending the pilot
to February 4, 2013 is consistent with the requirement to protect
investors because it will permit the circuit breaker to continue to
reduce the negative impacts of sudden, unanticipated price movements
until it is replaced by the preferred limit up/limit down mechanism.
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\13\ 15 U.S.C. 78f(b)(5).
\14\ 15 U.S.C. 78k-1(a)(1).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act, as amended.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
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 \15\ and Rule 19b-4(f)(6) thereunder.\16\
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 \17\ and Rule 19b-
4(f)(6)(iii) thereunder.\18\
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\15\ 15 U.S.C. 78s(b)(3)(A)(iii).
\16\ 17 CFR 240.19b-4(f)(6).
\17\ 15 U.S.C. 78s(b)(3)(A).
\18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's intent to file the proposed rule change along with a
brief description and text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
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A proposed rule change filed under Rule 19b-4(f)(6) \19\ normally
does not become operative for 30 days after the date of filing.
However, pursuant to Rule 19b-4(f)(6)(iii) \20\ the Commission may
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposal
may become operative immediately upon filing.
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\19\ 17 CFR 240.19b-4(f)(6).
\20\ 17 CFR 240.19b-4(f)(6)(iii).
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The Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest, as
it will allow the pilot program to continue uninterrupted, thereby
avoiding the investor confusion that could result from a temporary
interruption in the pilot program. For this reason, the Commission
designates the proposed rule change to be operative upon filing.\21\
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\21\ For purposes only of waiving the 30-day operative delay,
the Commission has also considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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[[Page 47450]]
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.
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-BX-2012-055 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 No. SR-BX-2012-055. 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 Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 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-BX-2012-055 and should be
submitted on or before August 29, 2012.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\22\
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\22\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-19353 Filed 8-7-12; 8:45 am]
BILLING CODE 8011-01-P