Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Establish a Rule Regarding Records of Written Complaints for the CBOE Stock Exchange, 47474-47476 [2012-19361]
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47474
Federal Register / Vol. 77, No. 153 / Wednesday, August 8, 2012 / Notices
wreier-aviles on DSK7SPTVN1PROD with NOTICES
to quote at price levels that are closer to
the National Best Bid and National Best
Offer if it elects to do so. To use this
functionality, a market maker must
designate the desired offset upon order
entry.15 Thereafter and unlike the
default 16 Market Maker Peg Order, a
Market Maker Peg Order with a market
maker-designated offset will have its
price automatically adjusted on a tickby-tick basis by the System to maintain
the market maker-designated offset from
the National Best Bid or National Best
Offer until the order is executed or
cancelled.17 In the absence of a National
Best Bid or National Best Offer, Market
Maker Peg Orders with a market makerdesignated offset will be cancelled or
rejected. In the event that pricing the
Market Maker Peg Order at the market
maker-designated offset away from the
then current National Best Bid and
National Best Offer would result in the
order exceeding its limit price, the order
will be cancelled or rejected.18
NASDAQ claims that this order-based
approach is superior in terms of the ease
in complying with the requirements of
the Market Access Rule and Regulation
SHO while also providing similar quote
adjusting functionality to its market
makers.19 NASDAQ also states that
market makers would have control of
order origination, as required by the
Market Access Rule, while also allowing
market makers to make marking and
locate determinations prior to order
entry, as required by Regulation SHO.
The Exchange claims that this will
allow market makers to fully comply
15 If a market maker wishes, it can designate a
more aggressive bid while using the Defined
Percentage and Defined Limit for its offer, or vice
versa.
16 In the absence of an offset designation, a
Market Maker Peg Order will default to using the
Defined Percentage and Defined Limit, and the
repricing process whereby, upon reaching the
Defined Limit, the price of a Market Maker Peg
Order bid or offer will be adjusted by the System
to the Designated Percentage away from the then
current National Best Bid or National Best Offer, or,
if no National Best Bid or National Best Offer, to
the Designated Percentage away from the last
reported sale from the responsible single plan
processor.
17 Market Maker Peg Orders with a market makerdesignated offset may be able to qualify as bona-fide
market making for purposes of Regulation SHO,
depending on the facts and circumstances. A
market maker entering such an order must consider
the factors set forth by the Commission in
determining whether reliance on the exception from
the ‘‘locate’’ requirement of Rule 203 for bona-fide
market making is appropriate with respect to the
particular Market Maker Peg Order and its
designated offset. See supra note 11.
18 The Market Maker Peg Order will be accepted
and executable during System hours. During pre
and post-market hours, the wider Designated
Percentage and Defined Limit associated with the
9:30 a.m.–9:45 a.m. and 3:35 p.m.–4:00 p.m. periods
under Rule 4613(a)(2)(D) and (E) will be applied.
19 See Notice, supra note 3 at 37088.
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15:11 Aug 07, 2012
Jkt 226001
with the requirements of the Market
Access Rule and Regulation SHO, as
they would when placing any order,
while also meeting their Exchange
market making obligations.20
III. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange.21 Specifically, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act,22 which requires,
among other things, 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 Commission finds
that the proposed rule change also is
designed to support the principles of
Section 11A(a)(1) 23 of the Act in that it
seeks to assure fair competition among
brokers and dealers and among
exchange markets.
The Commission finds that the
Exchange’s proposal is consistent with
the Act because it provides a means
through which market makers may meet
their minimum quoting requirements,
which may assist in the maintenance of
fair and orderly markets, provide
additional liquidity to the Exchange,
and prevent excessive volatility. At the
same time, the proposal is reasonably
designed to assist market makers in
complying with the regulatory
requirements of the Market Access Rule
and Regulation SHO. The Commission
notes, however, that the Market Maker
Peg Order, like the current AQ system,
does not ensure that the market maker
is satisfying the requirements of the
Market Access Rule or Regulation SHO,
including the satisfaction of the locate
requirement of Rule 203(b)(1) or an
exception thereto. The Commission also
notes that, in the event a Market Maker
Peg Order is executed against such that
the Market Maker Peg Order is reduced
in size to below one round lot, the
market maker would need to perform
the necessary regulatory checks
pursuant to the Market Access Rule and
Regulation SHO prior to entering a new
Market Maker Peg Order.
20 See
id.
approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition and capital
formation. 15 U.S.C. 78c(f).
22 15 U.S.C. 78f(b)(5).
23 15 U.S.C. 78k–1(a)(1).
21 In
PO 00000
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Fmt 4703
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The Commission also believes that
providing Exchange market makers with
a transition period, during which they
may adequately test the new
functionality of the Market Maker Peg
Order, will serve to minimize the
potential market impact caused by the
implementation of that order type. In
addition, by allowing market makers to
enter a Market Maker Peg Order that is
priced more aggressively than the
Designated Percentage, the proposed
rules are reasonably designed to provide
that quotations submitted by market
makers to the Exchange, and displayed
to market participants, bear some
relationship to the prevailing market
price.
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,24 that the
proposed rule change, as modified by
Amendment No. 1, (SR–NASDAQ–
2012–066) be, and hereby is, approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.25
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2012–19363 Filed 8–7–12; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–67581; File No. SR–CBOE–
2012–074]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Establish a Rule
Regarding Records of Written
Complaints for the CBOE Stock
Exchange
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 31,
2012, Chicago Board Options Exchange,
Incorporated (the ‘‘Exchange’’ or
‘‘CBOE’’) 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
24 15
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
25 17
E:\FR\FM\08AUN1.SGM
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Federal Register / Vol. 77, No. 153 / Wednesday, August 8, 2012 / Notices
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 establish a
rule regarding records of written
complaints that is specific to the CBOE
Stock Exchange (‘‘CBSX’’). The text of
the proposed rule change is available on
the Exchange’s Web site (https://
www.cboe.com/AboutCBOE/
CBOELegalRegulatoryHome.aspx), at
the Exchange’s Office of the Secretary,
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.
wreier-aviles on DSK7SPTVN1PROD with NOTICES
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to establish
Rule 53.7—CBSX Record of Written
Complaints to formally establish a
record keeping procedure for
complaints specific to CBSX. CBOE has
the options-specific Rule 9.23—
Customer Complaints. However, to date
there has been no equities-specific
customer complaint rule for CBSX.
Historically, the majority of CBSX
trading activity was proprietary. In
recent months, CBSX has seen an
increase in customer trading. As such,
CBSX desires to adopt a rule regarding
records of customer complaints that is
specific to CBSX to assist the
Exchange’s Regulatory Services Division
in investigations regarding CBSXspecific customer complaints.
Therefore, CBSX proposes to establish
Rule 53.7—CBSX Record of Written
Complaints. This proposed rule is
substantively identical to BATS
Exchange, Inc. (‘‘BATS’’) Rule 4.3—
Record of Written Complaints,3 with
one exception (discussed below). The
substance of proposed Rule 53.7 is
3 See
BATS Rule 4.3.
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15:11 Aug 07, 2012
nearly identical to that of BATS Rule 4.3
(which is very similar to record of
written complaints rules on other
exchanges) so that market participants
trading on multiple stock exchanges can
follow as uniform as possible a set of
rules regarding records of written
complaints.
Paragraph (a) of Rule 53.7 will
establish that each CBSX Trader shall
keep and preserve for a period of not
less than five years a file of all written
complaints of customers and action
taken by the CBSX Trader in respect
thereof, if any. Further, for the first two
years of the five-year period, the CBSX
Trader shall keep such file in a place
readily accessible to examination or
spot checks. This paragraph (a) of CBOE
Rule 53.7 is substantively identical to
BATS Rule 4.3(a).
Paragraph (b) of Rule 53.7 will
establish that upon request by CBSX, a
CBSX Trader shall forward promptly to
CBSX any written complaints requested
and a report of the action taken thereon.
BATS Rule 4.3 has no provision
requiring BATS members to forward
written complaints to BATS upon
request. However, CBSX desires to
include such a stipulation in order to
ensure CBSX has access to such
complaints for regulatory purposes.
Paragraph (c) of Rule 53.7 will
establish that a ‘‘complaint’’ shall mean
any written statement of a customer or
any person acting on behalf of a
customer alleging a grievance involving
the activities of a CBSX Trader or
persons under the control of the CBSX
Trader in connection with either the
solicitation or execution of any
transaction conducted or contemplated
to be conducted through the facilities of
the CBSX, or the disposition of
securities or funds of that customer
which activities are related to such a
transaction. This paragraph (c) of CBOE
Rule 53.7 is substantively identical to
BATS Rule 4.3(b).
The proposed Rule 53.7 encompasses
electronically submitted complaints
(including email). CBSX will issue a
Regulatory Circular providing
instructions on how to forward formal
written complaints specific to CBSX.
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the Act
and the rules and regulations
thereunder applicable to the Exchange
and, in particular, the requirements of
Section 6(b) of the Act.4 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
4 15
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PO 00000
U.S.C. 78f(b).
Frm 00118
Fmt 4703
Sfmt 4703
47475
6(b)(5) 5 requirements that the rules of
an exchange be designed to promote just
and equitable principles of trade, to
prevent fraudulent and manipulative
acts, to remove impediments to and to
perfect the mechanism for a free and
open market and a national market
system, and, in general, to protect
investors and the public interest.
In particular, establishing a CBSXspecific rule regarding records of
written complaints will assist CBSX’s
regulatory processes by ensuring that
customer complaints are kept by CBSX
Traders and are available to be
forwarded to CBSX for regulatory
purposes. This helps ensure that
customer complaints are adequately
addressed, thereby removing
impediments to, and perfecting the
mechanism for a free and open market
and a national market system and, in
general, protecting investors and the
public interest.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
CBOE 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
The Exchange neither solicited nor
received comments on the proposed
rule change.
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) of the Act 6 and Rule 19b–
4(f)(6) thereunder.7
The Exchange has requested that the
Commission waive the 30-day operative
delay. The Exchange believes that the
5 15
U.S.C. 78f(b)(5).
U.S.C. 78s(b)(3)(A).
7 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.
6 15
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47476
Federal Register / Vol. 77, No. 153 / Wednesday, August 8, 2012 / Notices
proposed rule change is consistent with
the protection of investors and the
public interest because it would permit
the Exchange to immediately implement
the proposed rule change that would
allow CBSX to begin ensuring that
customer complaints are adequately
kept and addressed by CBSX Traders.8
The Commission believes that waiver of
the 30-day operative delay is consistent
with the protection of investors and the
public interest. Such waiver would
allow the Exchange, without delay, to
require CBSX Traders to establish a
process to maintain, and make available
to CBSX upon request, certain customer
complaints. The Commission notes that
the proposed rule change is based on
and similar to BATS Rule 4.3.9
Therefore, the Commission hereby
waives the 30-day operative delay and
designates the proposal operative upon
filing.10
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 Exchange
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–CBOE–2012–074 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–CBOE–2012–074. 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
8 See
SR–CBOE–2012–074, Item 7.
supra note 3.
10 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
9 See
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15:11 Aug 07, 2012
Jkt 226001
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
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. All comments received will
be posted without change; the
Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–CBOE–
2012–074 and should be submitted on
or before August 29, 2012.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2012–19361 Filed 8–7–12; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–67577; File No. SR–NSX–
2012–10]
Self-Regulatory Organizations;
National Stock Exchange, Inc.; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change To Amend
Its Rules To Extend Pilot Program
Regarding Trading Pauses in
Individual Securities Due to
Extraordinary Market Volatility
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 25,
2012, the National Stock Exchange, Inc.
(‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
11 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
PO 00000
Frm 00119
Fmt 4703
Sfmt 4703
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
National Stock Exchange, Inc.
(‘‘NSX®’’ or ‘‘Exchange’’) is proposing to
amend its rules to extend a certain pilot
program regarding trading pauses in
individual securities due to
extraordinary market volatility.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://www.nsx.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
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
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
With this rule change, the Exchange is
proposing to extend a pilot program
currently in effect regarding trading
pauses in individual securities due to
extraordinary market volatility under
NSX Rule 11.20B. Currently, unless
otherwise extended or approved
permanently, this pilot program will
expire on July 31, 2012. The instant rule
filing proposes an extension to the pilot
program until February 4, 2013.
NSX Rule 11.20B (Trading Pauses in
Individual Securities Due to
Extraordinary Market Volatility) was
approved by the Securities and
Exchange Commission (the
‘‘Commission’’) on June 10, 2010 on a
pilot basis to end on December 10,
2010.3 The pilot program end date was
subsequently extended until April 11,
3 See Securities Exchange Act Release No. 62252
(June 10, 2010), 75 FR 34186 (June 16, 2010) (SR–
NSX–2010–05).
E:\FR\FM\08AUN1.SGM
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]]>Agencies
[Federal Register Volume 77, Number 153 (Wednesday, August 8, 2012)]
[Notices]
[Pages 47474-47476]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-19361]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-67581; File No. SR-CBOE-2012-074]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Establish a Rule Regarding Records of Written
Complaints for the CBOE Stock Exchange
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 31, 2012, Chicago Board Options Exchange, Incorporated
(the ``Exchange'' or ``CBOE'') 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
[[Page 47475]]
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 establish a rule regarding records of
written complaints that is specific to the CBOE Stock Exchange
(``CBSX''). The text of the proposed rule change is available on the
Exchange's Web site (https://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the
Secretary, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to establish Rule 53.7--CBSX Record of
Written Complaints to formally establish a record keeping procedure for
complaints specific to CBSX. CBOE has the options-specific Rule 9.23--
Customer Complaints. However, to date there has been no equities-
specific customer complaint rule for CBSX. Historically, the majority
of CBSX trading activity was proprietary. In recent months, CBSX has
seen an increase in customer trading. As such, CBSX desires to adopt a
rule regarding records of customer complaints that is specific to CBSX
to assist the Exchange's Regulatory Services Division in investigations
regarding CBSX-specific customer complaints. Therefore, CBSX proposes
to establish Rule 53.7--CBSX Record of Written Complaints. This
proposed rule is substantively identical to BATS Exchange, Inc.
(``BATS'') Rule 4.3--Record of Written Complaints,\3\ with one
exception (discussed below). The substance of proposed Rule 53.7 is
nearly identical to that of BATS Rule 4.3 (which is very similar to
record of written complaints rules on other exchanges) so that market
participants trading on multiple stock exchanges can follow as uniform
as possible a set of rules regarding records of written complaints.
---------------------------------------------------------------------------
\3\ See BATS Rule 4.3.
---------------------------------------------------------------------------
Paragraph (a) of Rule 53.7 will establish that each CBSX Trader
shall keep and preserve for a period of not less than five years a file
of all written complaints of customers and action taken by the CBSX
Trader in respect thereof, if any. Further, for the first two years of
the five-year period, the CBSX Trader shall keep such file in a place
readily accessible to examination or spot checks. This paragraph (a) of
CBOE Rule 53.7 is substantively identical to BATS Rule 4.3(a).
Paragraph (b) of Rule 53.7 will establish that upon request by
CBSX, a CBSX Trader shall forward promptly to CBSX any written
complaints requested and a report of the action taken thereon. BATS
Rule 4.3 has no provision requiring BATS members to forward written
complaints to BATS upon request. However, CBSX desires to include such
a stipulation in order to ensure CBSX has access to such complaints for
regulatory purposes.
Paragraph (c) of Rule 53.7 will establish that a ``complaint''
shall mean any written statement of a customer or any person acting on
behalf of a customer alleging a grievance involving the activities of a
CBSX Trader or persons under the control of the CBSX Trader in
connection with either the solicitation or execution of any transaction
conducted or contemplated to be conducted through the facilities of the
CBSX, or the disposition of securities or funds of that customer which
activities are related to such a transaction. This paragraph (c) of
CBOE Rule 53.7 is substantively identical to BATS Rule 4.3(b).
The proposed Rule 53.7 encompasses electronically submitted
complaints (including email). CBSX will issue a Regulatory Circular
providing instructions on how to forward formal written complaints
specific to CBSX.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\4\ Specifically, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \5\ requirements that the rules of
an exchange be designed to promote just and equitable principles of
trade, to prevent fraudulent and manipulative acts, to remove
impediments to and to perfect the mechanism for a free and open market
and a national market system, and, in general, to protect investors and
the public interest.
---------------------------------------------------------------------------
\4\ 15 U.S.C. 78f(b).
\5\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
In particular, establishing a CBSX-specific rule regarding records
of written complaints will assist CBSX's regulatory processes by
ensuring that customer complaints are kept by CBSX Traders and are
available to be forwarded to CBSX for regulatory purposes. This helps
ensure that customer complaints are adequately addressed, thereby
removing impediments to, and perfecting the mechanism for a free and
open market and a national market system and, in general, protecting
investors and the public interest.
B. Self-Regulatory Organization's Statement on Burden on Competition
CBOE 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
The Exchange neither solicited nor received comments on the
proposed rule change.
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) of the Act \6\ and Rule 19b-
4(f)(6) thereunder.\7\
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\6\ 15 U.S.C. 78s(b)(3)(A).
\7\ 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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The Exchange has requested that the Commission waive the 30-day
operative delay. The Exchange believes that the
[[Page 47476]]
proposed rule change is consistent with the protection of investors and
the public interest because it would permit the Exchange to immediately
implement the proposed rule change that would allow CBSX to begin
ensuring that customer complaints are adequately kept and addressed by
CBSX Traders.\8\ The Commission believes that waiver of the 30-day
operative delay is consistent with the protection of investors and the
public interest. Such waiver would allow the Exchange, without delay,
to require CBSX Traders to establish a process to maintain, and make
available to CBSX upon request, certain customer complaints. The
Commission notes that the proposed rule change is based on and similar
to BATS Rule 4.3.\9\ Therefore, the Commission hereby waives the 30-day
operative delay and designates the proposal operative upon filing.\10\
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\8\ See SR-CBOE-2012-074, Item 7.
\9\ See supra note 3.
\10\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
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 Exchange 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 Number SR-CBOE-2012-074 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-CBOE-2012-074. 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
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-CBOE-2012-074 and should be
submitted on or before August 29, 2012.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-19361 Filed 8-7-12; 8:45 am]
BILLING CODE 8011-01-P
