Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Eliminating Certain Credits Within the New York Stock Exchange LLC Price List, 2306-2308 [2013-00310]
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Federal Register / Vol. 78, No. 7 / Thursday, January 10, 2013 / Notices
wreier-aviles on DSK5TPTVN1PROD with
and regulations thereunder applicable to
a national securities exchange.17 In
particular, the Commission finds that
the proposed rule change is consistent
with Section 6(b)(5) of the Act,18 which
requires, among other things, that the
rules of a national securities exchange
be 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; and are not designed to
permit unfair discrimination between
customers, issuers, brokers, or dealers.
In addition, the Commission believes
the proposed rule change is consistent
with Section 11A(a)(1)(C) of the Act 19
in that it seeks to assure economically
efficient execution of securities
transactions.
The Commission recognizes that
technical or systems issues may occur,
and believes that CBOE Rule 52.3A, in
allowing CBSX to cancel or release
orders affected by technical or systems
issues, should provide a reasonably
efficient means for CBSX to handle such
orders, and appears reasonably designed
to permit CBSX to maintain fair and
orderly markets.20
The Commission also believes that
allowing CBSX to resolve error positions
through the use of error accounts
maintained by its routing brokers or
CBSX itself pursuant to the procedures
set forth in the rule, and as described
above, is consistent with the Act. The
Commission notes that the rule
establishes criteria for determining
which positions are error positions to
which the rule applies, and the
procedures for the handling of such
positions. In particular, the Commission
17 In approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
18 15 U.S.C. 78f(b)(5).
19 15 U.S.C. 78k–1(a)(1)(C).
20 The Commission notes that CBSX states it
believes that allowing it to cancel or release orders
under such circumstances would allow CBSX to
maintain fair and orderly markets, and that CBOE
Rule 52.10A is designed to ensure full trade
certainty for market participants, and avoid
disrupting the clearance and settlement process.
See Notice, 77 FR at 70514. The Commission also
notes that CBOE states that a decision to cancel or
release orders due to a technical or systems issue
is not equivalent to CBSX declaring self-help
against a routing destination pursuant to Rule 611
of Regulation NMS. See 17 CFR 242.611(b). See also
Notice, 77 FR at 70512 n.9.
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notes that CBOE Rule 52.10A only
applies to error positions that result
from the Exchanges routing service, and
that such positions shall be liquidated
by the routing broker or the Exchange,
as applicable, as soon as practicable.21
In this regard, the Commission believes
that the new rule appears reasonably
designed to further just and equitable
principles of trade and the protection of
investors and the public interest, and to
help prevent unfair discrimination, in
that it should help assure the handling
of error positions will be based on clear
and objective criteria, and that the
resolution of those positions will occur
promptly through a transparent process.
The Commission is also concerned
about the potential for misuse of
confidential and proprietary
information. The Commission notes that
CBSX or a routing broker, as applicable,
will establish and enforce policies and
procedures reasonably designed to (1)
adequately restrict the flow of
confidential and proprietary
information associated with the
liquidation of the error positions, and
(2) in the case of liquidations by a
routing broker, prevent the use of
information associated with other orders
subject to the routing services when
making determinations regarding the
liquidation of error positions.22
Furthermore, to the extent CBSX uses a
CBSX Error Account to liquidate error
positions, the Exchange shall provide
complete time and price discretion for
the trading to liquidate error positions
in a CBSX Error Account to a third-party
broker-dealer and shall not attempt to
exercise any influence or control over
the timing or methods of such trading.23
The Commission believes that these
requirements should help mitigate the
Commission’s concerns. In particular,
the Commission believes that these
requirements should help assure that
none of CBSX, its routing brokers, or
any third-party broker-dealer is able to
misuse confidential or proprietary
information obtained in connection
with the liquidation of error positions
for its own benefit. The Commission
also notes that routing brokers would be
required to make and keep records
associated with the liquidation of
routing broker error positions 24 and
CBOE would be required to make and
keep records to document all
determinations to treat positions as error
positions under this Rule (whether or
not a CBSX Error Account is used to
liquidate such error positions), as well
21 See
CBOE Rule 52.10A.
CBOE Rules 52.10A(d)(i); 52.10A(e)(ii).
23 See CBOE Rule 52.10A(e)(i).
24 See CBOE Rule 52.10A(d)(ii).
22 See
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Fmt 4703
Sfmt 4703
as records associated with the
liquidation of CBSX Error Account error
positions through a third-party brokerdealer.25
Finally, the Commission notes that
the proposed procedures for canceling
orders and the handling of error
positions are consistent with procedures
the Commission has approved for other
exchanges.26
IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,27 that the
proposed rule change (SR–CBOE–2012–
109) be, and it hereby is, approved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.28
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2013–00307 Filed 1–9–13; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–68579; File No. SR–NYSE–
2012–78]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change Eliminating
Certain Credits Within the New York
Stock Exchange LLC Price List
January 4, 2013.
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 December
21, 2012, New York Stock Exchange
LLC (the ‘‘Exchange’’ or ‘‘NYSE’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I, II and III below, which Items
have been prepared by the Exchange.
The Commission is publishing this
notice to solicit comments on the
proposed rule change from interested
persons.
25 See
CBOE Rule 52.10A(e)(iii).
e.g., Securities Exchange Act Release Nos.
67281 (June 27, 2012), 77 FR 39543 (July 3, 2012)
(SR–NASDAQ–2012–057); 66963 (May 10, 2012),
77 FR 28919 (May 16, 2012) (SR–NYSEArca–2012–
22); 67010 (May 17, 2012), 77 FR 30564 (May 23,
2012) (SR–EDGX–2012–08); and 67011 (May 17,
2012), 77 FR 30562 (May 23, 2012) (SR–EDGA–
2012–09).
27 15 U.S.C. 78s(b)(2).
28 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
26 See,
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Federal Register / Vol. 78, No. 7 / Thursday, January 10, 2013 / Notices
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to eliminate
certain credits within its Price List,
which the Exchange proposes to become
operative on January 1, 2013. The text
of the proposed rule change is available
on the Exchange’s Web site at
www.nyse.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 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
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to eliminate
certain credits within its Price List,
which the Exchange proposes to become
operative on January 1, 2013.
Currently, the Exchange provides a
credit per share of $0.0002 for member
organizations, floor brokers, Designated
Market Makers (‘‘DMMs’’), and
Supplemental Liquidity Providers
(‘‘SLPs’’) that provide displayed
liquidity to the Exchange in the
following ten active securities (‘‘Active
Securities’’): 3
Company name
Symbol
wreier-aviles on DSK5TPTVN1PROD with
Bank of America Corp. ...............
Citigroup Inc. ..............................
Ford Motor Company .................
General Electric ..........................
JPMorgan Chase & Co. .............
Nokia Corporation .......................
PFIZER Inc. ................................
Sprint Nextel Corporation ...........
AT&T Inc. ....................................
Wells Fargo & Co. ......................
BAC
C
F
GE
JPM
NOK
PFE
S
T
WFC
The credit applies to transactions in
the Active Securities and is in addition
3 See Securities Exchange Act Release No. 68021
(October 9, 2012), 77 FR 63406 (October 16, 2012)
(SR–NYSE–2012–50).
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Jkt 229001
to any other credit for floor and nonfloor transactions.4
The Exchange proposes to eliminate
this credit for member organizations,
floor brokers, DMMs, and SLPs from the
Fee Schedule because the incremental
credit has not resulted in significant
additional liquidity in the Active
Securities.
The proposed changes are not
otherwise intended to address any other
problem, and the Exchange is not aware
of any significant problem that the
affected market participants would have
in complying with the proposed
changes.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,5 in general, and
furthers the objectives of Section 6(b)(4)
of the Act,6 in particular, because it
provides for the equitable allocation of
reasonable dues, fees, and other charges
among its members and issuers and
other persons using its facilities and
does not unfairly discriminate between
customers, issuers, brokers, or dealers.
The Exchange also believes that the
proposed rule change is consistent with
Section 6(b)(5) of the Act,7 in particular,
because it is designed to prevent
fraudulent and manipulative acts and
practices, to promote just and equitable
principles of trade, to foster cooperation
and coordination with persons engaged
in regulating, clearing, settling,
processing information with respect to,
and facilitating transactions in
securities, to remove impediments to,
and perfect the mechanisms of, a free
and open market and a national market
system and, in general, to protect
investors and the public interest and
because it is not designed to permit
unfair discrimination between
customers, issuers, brokers, or dealers.
The Exchange believes that
eliminating the credit for transactions in
Active Securities for member
organizations, floor brokers, DMMs, and
SLPs is reasonable because it did not
encourage sufficient additional liquidity
and competition in the Active Securities
on the Exchange. As such, the Exchange
believes it is reasonable not to provide
an additional credit for transactions in
the Active Securities. The Exchange
believes that eliminating the credit for
transactions in Active Securities is
equitable and not unfairly
discriminatory because all similarly
4 The
credit does not apply to transactions in the
Active Securities in the Retail Liquidity Program.
5 15 U.S.C. 78f(b).
6 15 U.S.C. 78f(b)(4).
7 15 U.S.C. 78f(b)(5).
PO 00000
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2307
situated member organizations, floor
brokers, DMMs, and SLPs would be
subject to the same fee structure. In
addition, the Exchange believes that
eliminating the credit is equitable and
not unfairly discriminatory because it
did not generate enough additional
volumes of liquidity in Active Securities
to warrant the additional credit.
The Exchange believes that the
proposed change is designed to provide
appropriate incentives for all market
participants, thereby removing
impediments to and perfecting the
mechanism of a free and open market
system. In addition, for the reasons
stated above, the proposed changes are
not designed to permit unfair
discrimination between customers,
issuers, brokers, or dealers.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act because the
additional credit for executions in
Active Securities did not contribute to
a meaningful change in market share
across NYSE-listed stocks, and
therefore, the Exchange expects that
eliminating the credit will similarly
have little impact on the Exchange or in
other securities markets. As stated
above, the Exchange believes that the
proposed change would impact all
similarly situated market participants
equally, and as such, the proposed
change would not impose a disparate
burden on competition either among or
between classes of market participants.
In addition, the Exchange notes that it
operates in a highly competitive market
in which market participants can
readily favor competing venues. In such
an environment, the Exchange must
continually review, and consider
adjusting, its fees and credits to remain
competitive with other exchanges. For
the reasons described above, the
Exchange believes that the proposed
rule change promotes a competitive
environment.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change is effective
upon filing pursuant to Section
E:\FR\FM\10JAN1.SGM
10JAN1
2308
Federal Register / Vol. 78, No. 7 / Thursday, January 10, 2013 / Notices
19(b)(3)(A) 8 of the Act and
subparagraph (f)(2) of Rule 19b–4 9
thereunder, because it establishes a due,
fee, or other charge imposed by NYSE.
At any time within 60 days of the
filing of such proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
wreier-aviles on DSK5TPTVN1PROD with
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–NYSE–2012–78 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–NYSE–2012–78. 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 the
filing also will be available for
8 15
9 17
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(2).
VerDate Mar<15>2010
15:22 Jan 09, 2013
Jkt 229001
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–NYSE–
2012–78 and should be submitted on or
before January 31, 2013.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.10
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2013–00310 Filed 1–9–13; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–68585; File No. SR–CBOE–
2012–108]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Order Approving a
Proposed Rule Change To Address the
Authority To Cancel Orders When a
Technical or Systems Issue Occurs
and To Describe the Operation of
Routing Service Error Accounts
January 4, 2013.
I. Introduction
On November 8, 2012, the Chicago
Board Options Exchange, Incorporated
(‘‘Exchange’’ or ‘‘CBOE’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change to
(i) address the authority of the Exchange
to cancel orders (or release routingrelated orders) when a technical or
systems issue occurs; and (ii) describe
the operation of an Exchange error
account(s) and routing broker error
account(s), which may be used to
liquidate unmatched executions that
may occur in the provision of the
Exchange’s routing service. The
proposed rule change was published for
comment in the Federal Register on
November 26, 2012.3 The Commission
received no comment letters regarding
the proposed rule change. This order
approves the proposed rule change.
10 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 Securities Exchange Act Release No. 68262
(November 19, 2012), 77 FR 70517 (November 26,
2012) (SR–CBOE–2012–108) (‘‘Notice’’).
1 15
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Sfmt 4703
II. Description of the Proposal
In its proposal, the Exchange states
that it operates a ‘‘hybrid’’ style system
of trading that allows automatic
executions to occur electronically and
open outcry trades to occur on the floor
of the Exchange.4 As part of this
infrastructure, the Exchange states that
it automatically routes orders to other
exchanges under certain circumstances.
These routing services are provided in
conjunction with one or more routing
brokers that are not affiliated with the
Exchange.5 Mechanically, when the
Exchange receives an order from a
Trading Permit Holder that is held in
the Exchange system and determines to
route an order to another exchange, the
Exchange provides the routing broker
with a corresponding order and
instructions to route the order to
another exchange. The routing broker
then sends the corresponding order to
the other exchange.
In its proposal, CBOE states that the
Exchange may encounter situations that
make it necessary to cancel orders (or
release routing-related orders),6 and to
resolve error positions that result from
errors of the Exchange, routing brokers,
or another exchange.7
Proposed Rule 6.6A (Order
Cancellation/Release)
New CBOE Rule 6.6A provides CBOE
with general authority to cancel orders
as it deems to be necessary to maintain
fair and orderly markets if a technical or
systems issue occurs at the Exchange, a
routing broker in connection with the
routing service provided under CBOE
Rule 6.14B, or another exchange to
which an Exchange order has been
routed. It also provides that a routing
broker may only cancel orders being
routed to another exchange based on the
Exchange’s standing or specific
instructions or as otherwise provided in
the Exchange Rules. CBOE will be
required to provide notice of the
cancellation to affected Trading Permit
Holders as soon as practicable.8
Paragraph (b) of the rule provides that
the Exchange may also determine to
release orders being held on the
4 See
Notice, 77 FR at 70518.
Notice, 77 FR at 70518 n.4, n.8, and
accompanying text.
6 See Notice, 77 FR at 70518. For examples of
some of the circumstances in which the Exchange
may decide to cancel orders, see Notice, 77 FR at
70519.
7 See Notice, 77 FR at 70518. Specifically, CBOE
Rule 6.14C defines ‘‘error positions’’ as ‘‘unmatched
trade positions that may occur in connection with
the routing service provided under Rule 6.14B’’.
For examples of some of the circumstances that
may lead to error positions, see Notice, 77 FR at
70520–21.
8 See CBOE Rule 6.6A(a).
5 See
E:\FR\FM\10JAN1.SGM
10JAN1
]]>Agencies
[Federal Register Volume 78, Number 7 (Thursday, January 10, 2013)]
[Notices]
[Pages 2306-2308]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-00310]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-68579; File No. SR-NYSE-2012-78]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Eliminating Certain Credits Within the New York Stock Exchange LLC
Price List
January 4, 2013.
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 December 21, 2012, New York Stock Exchange LLC (the
``Exchange'' or ``NYSE'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule change as described in
Items I, II and III below, which Items have been prepared by the
Exchange. The Commission is publishing this notice to solicit comments
on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
[[Page 2307]]
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to eliminate certain credits within its Price
List, which the Exchange proposes to become operative on January 1,
2013. The text of the proposed rule change is available on the
Exchange's Web site at www.nyse.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 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
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to eliminate certain credits within its Price
List, which the Exchange proposes to become operative on January 1,
2013.
Currently, the Exchange provides a credit per share of $0.0002 for
member organizations, floor brokers, Designated Market Makers
(``DMMs''), and Supplemental Liquidity Providers (``SLPs'') that
provide displayed liquidity to the Exchange in the following ten active
securities (``Active Securities''): \3\
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 68021 (October 9,
2012), 77 FR 63406 (October 16, 2012) (SR-NYSE-2012-50).
------------------------------------------------------------------------
Company name Symbol
------------------------------------------------------------------------
Bank of America Corp....................... BAC
Citigroup Inc.............................. C
Ford Motor Company......................... F
General Electric........................... GE
JPMorgan Chase & Co........................ JPM
Nokia Corporation.......................... NOK
PFIZER Inc................................. PFE
Sprint Nextel Corporation.................. S
AT&T Inc................................... T
Wells Fargo & Co........................... WFC
------------------------------------------------------------------------
The credit applies to transactions in the Active Securities and is
in addition to any other credit for floor and non-floor
transactions.\4\
---------------------------------------------------------------------------
\4\ The credit does not apply to transactions in the Active
Securities in the Retail Liquidity Program.
---------------------------------------------------------------------------
The Exchange proposes to eliminate this credit for member
organizations, floor brokers, DMMs, and SLPs from the Fee Schedule
because the incremental credit has not resulted in significant
additional liquidity in the Active Securities.
The proposed changes are not otherwise intended to address any
other problem, and the Exchange is not aware of any significant problem
that the affected market participants would have in complying with the
proposed changes.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\5\ in general, and furthers the
objectives of Section 6(b)(4) of the Act,\6\ in particular, because it
provides for the equitable allocation of reasonable dues, fees, and
other charges among its members and issuers and other persons using its
facilities and does not unfairly discriminate between customers,
issuers, brokers, or dealers. The Exchange also believes that the
proposed rule change is consistent with Section 6(b)(5) of the Act,\7\
in particular, because it is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, to remove impediments to, and perfect the mechanisms of, a
free and open market and a national market system and, in general, to
protect investors and the public interest and because it is not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(4).
\7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange believes that eliminating the credit for transactions
in Active Securities for member organizations, floor brokers, DMMs, and
SLPs is reasonable because it did not encourage sufficient additional
liquidity and competition in the Active Securities on the Exchange. As
such, the Exchange believes it is reasonable not to provide an
additional credit for transactions in the Active Securities. The
Exchange believes that eliminating the credit for transactions in
Active Securities is equitable and not unfairly discriminatory because
all similarly situated member organizations, floor brokers, DMMs, and
SLPs would be subject to the same fee structure. In addition, the
Exchange believes that eliminating the credit is equitable and not
unfairly discriminatory because it did not generate enough additional
volumes of liquidity in Active Securities to warrant the additional
credit.
The Exchange believes that the proposed change is designed to
provide appropriate incentives for all market participants, thereby
removing impediments to and perfecting the mechanism of a free and open
market system. In addition, for the reasons stated above, the proposed
changes are not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act because the additional credit
for executions in Active Securities did not contribute to a meaningful
change in market share across NYSE-listed stocks, and therefore, the
Exchange expects that eliminating the credit will similarly have little
impact on the Exchange or in other securities markets. As stated above,
the Exchange believes that the proposed change would impact all
similarly situated market participants equally, and as such, the
proposed change would not impose a disparate burden on competition
either among or between classes of market participants. In addition,
the Exchange notes that it operates in a highly competitive market in
which market participants can readily favor competing venues. In such
an environment, the Exchange must continually review, and consider
adjusting, its fees and credits to remain competitive with other
exchanges. For the reasons described above, the Exchange believes that
the proposed rule change promotes a competitive environment.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change is effective upon filing pursuant to
Section
[[Page 2308]]
19(b)(3)(A) \8\ of the Act and subparagraph (f)(2) of Rule 19b-4 \9\
thereunder, because it establishes a due, fee, or other charge imposed
by NYSE.
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\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(2).
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At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NYSE-2012-78 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-NYSE-2012-78. 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 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-NYSE-2012-78 and should be
submitted on or before January 31, 2013.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-00310 Filed 1-9-13; 8:45 am]
BILLING CODE 8011-01-P
