Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Individual Stock Trading Pause Pilot Program, 9975-9977 [2013-03188]

Download as PDF Federal Register / Vol. 78, No. 29 / Tuesday, February 12, 2013 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–68854; File No. SR–CBOE– 2013–010] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Individual Stock Trading Pause Pilot Program February 6, 2013. 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 January 28, 2013, Chicago Board Options Exchange, Incorporated (‘‘CBOE’’ or ‘‘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 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. (additions are italicized; deletions are [bracketed]) * * * * * Chicago Board Options Exchange, Incorporated Rules tkelley on DSK3SPTVN1PROD with NOTICES * * * * * 1. Rule 6.3C—Individual Stock Trading Pause Due to Extraordinary Market Volatility 2. * * * * * * * * Interpretations and Policies: * * * * * .03 The provisions of this Rule shall be in effect for eligible NMS stocks during a pilot period ending on the earlier of the initial date of operations of the Regulation NMS Plan to Address Extraordinary Market Volatility or February 4, 2014[3]. The term ‘‘eligible NMS stocks’’ shall mean NMS stocks, other than rights and warrants. Trading in an eligible NMS stock will pause between the hours of 8:45 a.m. and 2:35 1 15 2 17 U.S.C.78s(b)(1). CFR 240.19b–4. VerDate Mar<15>2010 16:40 Feb 11, 2013 Jkt 229001 p.m. (all times are CT), or in the case of an early scheduled close, 25 minutes before the close of trading, if the price of the stock moved by a percentage specified below within a five-minute period (‘‘Threshold Move’’), as calculated by the primary listing market as follows: * * * * * The text of the proposed rule change is also 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. 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 Rule 6.3C, Individual Stock Trading Pauses Due to Extraordinary Market Volatility, was approved by the Securities and Exchange Commission (‘‘Commission’’) on June 10, 2010 on a pilot basis. The pilot is currently set to expire on February 4, 2013.3 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.4 3 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); 66166 (January 17, 2012), 77 FR 3311 (January 23, 2012)(SR–CBOE– 2012–01)(extension of pilot through July 31, 2012); and 67574 (August 2, 2012), 77 FR 49848 (August 17, 2012)(SR–CBOE–2012–069)(extension of pilot through February 4, 2012). 4 The pilot list of stocks originally included all stocks in the S&P 500 Index, but it has been PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 9975 As the duration of the pilot expires on February 4, 2013, the Exchange is proposing to extend the effectiveness of Rule 6.3C until the earlier of the initial date of operations of the Regulation NMS Plan to Address Extraordinary Market Volatility or February 4, 2014. The pilot will continue to operate as to individual securities until such security is subject to the Regulation NMS Plan to Address Extraordinary Market Volatility. Extending the extension date would allow the pilot to continue to operate without interruption until implementation of the Regulation NMS Plan to Address Extraordinary Market Volatility.5 The Regulation NMS Plan to Address Extraordinary Market Volatility will not begin initial operations on February 4, 2013 as initially planned, but has an amended anticipated implementation date of April 8, 2013.6 If the Regulation NMS Plan to Address Extraordinary Market Volatility has an initial date of operations before February 4, 2014, the proposed pilot for trading pauses will expire at that time. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the ‘‘Act’’) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.7 Specifically, the Exchange believes the proposed rule change is consistent with the Section 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). 5 See Securities Exchange Act Release No. 67091 (May 31, 2012), 77 FR 33498 (June 6, 2012) (File No. 4–631) (Order Approving, on a Pilot Basis, the National Market System Plan To Address Extraordinary Market Volatility by BATS Exchange, Inc., BATS Y-Exchange, Inc., Chicago Board Options Exchange, Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, The Nasdaq Stock Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc). 6 See Letter from Janet M. McGinness, Executive Vice President and Corporate Secretary, General Counsel, NYSE Markets, to Elizabeth M. Murphy, Secretary, Commission, dated January 17, 2013. 7 15 U.S.C. 78f(b). E:\FR\FM\12FEN1.SGM 12FEN1 9976 Federal Register / Vol. 78, No. 29 / Tuesday, February 12, 2013 / Notices tkelley on DSK3SPTVN1PROD with NOTICES 6(b)(5) 8 requirements that the rules of an 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 facilitation 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. Additionally, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 9 requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers. In particular, the Exchange believes that the change proposed herein meets these requirements in that it promotes uniformity across markets concerning decisions to pause trading in a security when there are significant price movements, which promotes just and equitable principles of trade and removes impediments to, and perfects the mechanism of, a free and open market and a national market system. Additionally, extension of the pilot until the earlier of the initial date of operations of the Regulation NMS Plan to Address Extraordinary Market Volatility or February 4, 2014 would allow the pilot to continue to operate without interruption while the Exchange and the Commission further assess the effect of the pilot on the marketplace or whether other initiatives should be adopted in lieu of the current pilot, which contributes to the protection of 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. The proposed changes are being made to extend the operation of the trading pause pilot until the earlier of the initial date of operations of the Regulation NMS Plan to Address Extraordinary Market Volatility or February 4, 2014 would allow the pilot to continue to operate without interruption until implementation of the Regulation NMS Plan to Address Extraordinary Market Volatility, which contributes to the protection of investors and the public interest. Other competing equity 8 15 U.S.C. 78f(b)(5). 9 Id. VerDate Mar<15>2010 16:40 Feb 11, 2013 Jkt 229001 exchanges are subject to the same trading pause requirements specified in the Plan. Thus, the proposed changes will not impose any burden on competition while providing trading pause requirements specified in the Plan. 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 The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 10 and Rule 19b–4(f)(6) thereunder.11 Because the proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative prior to 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b–4(f)(6)(iii) thereunder. A proposed rule change filed under Rule 19b–4(f)(6) 12 normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b–4(f)(6)(iii),13 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 because such waiver would allow the pilot program to continue uninterrupted. Accordingly, the Commission hereby grants the 10 15 U.S.C. 78s(b)(3)(A)(iii). CFR 240.19b–4(f)(6). In addition, Rule 19b4(f)(6) 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. 12 17 CFR 240.19b–4(f)(6). 13 17 CFR 240.19b–4(f)(6)(iii). 11 17 PO 00000 Frm 00094 Fmt 4703 Sfmt 4703 Exchange’s request and designates the proposal operative upon filing.14 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 rulecomments@sec.gov. Please include File Number SR–CBOE–2013–010 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–2013–010. 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 14 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). E:\FR\FM\12FEN1.SGM 12FEN1 Federal Register / Vol. 78, No. 29 / Tuesday, February 12, 2013 / Notices 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 publicly available. All submissions should refer to File Number SR–CBOE– 2013–010 and should be submitted on or before March 5, 2013. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.15 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2013–03188 Filed 2–11–13; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–68838; File No. SR-Phlx2013–08] Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to the Routing Functionality of the NASDAQ OMX PSX Market February 6, 2013. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 2 thereunder, notice is hereby given that on January 23, 2013, NASDAQ OMX PHLX LLC (‘‘Phlx’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I 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 is filing with the Commission a proposal to add routing functionality to the NASDAQ OMX PSX Market (‘‘System’’). Specifically, the Exchange proposes to amend Rule 3315, Order Routing. Proposed new language is italicized. * * * * * tkelley on DSK3SPTVN1PROD with NOTICES NASDAQ OMX PSX NASDAQ OMX PSX (Rules 3000–3407) Rule 3000. NASDAQ OMX PSX * * * * * 15 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 VerDate Mar<15>2010 16:40 Feb 11, 2013 Jkt 229001 3315. Order Routing (a) Order Routing Process (1) No change. (A) No change. (i)–(vii) No change. (viii) XDRK is a routing option under which orders check the System for available shares and simultaneously route the remaining shares to destinations on the System routing table that are not posting Protected Quotations within the meaning of Regulation NMS. If shares remain unexecuted after routing, they are posted on the book. Once on the book, should the order subsequently be locked or crossed by another market center, the System will not route the order to the locking or crossing market center. (ix) XCST is a routing option under which orders check the System for available shares and simultaneously route the remaining shares to destinations on the System routing table that are not posting Protected Quotations within the meaning of Regulation NMS and to certain, but not all, exchanges. If shares remain unexecuted after routing, they are posted on the book. Once on the book, should the order subsequently be locked or crossed by another market center, the System will not route the order to the locking or crossing market center. (B) No change. (b)–(d) Not applicable. * * * * * (b) and (c) Not applicable. * * * * * 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 purpose of the proposed rule change is to attract additional business to and enhance the functionality offered by the Exchange’s NASDAQ OMX PSX equities market by providing additional optional outbound routing services. PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 9977 Most equities exchanges today provide routing services and the Exchange offers a variety of routing strategies. Currently, Rule 3315, Order Routing, describes the order routing process and states that all routing shall be in compliance with Rule 611 of Regulation NMS under the Act.3 Furthermore, it enumerates PSX’s routing strategies: PSTG, PSKN, PSCN, PSKP, PTFY, PMOP and PCRT. Proposed Rule 3315(a)(1)(A)(viii) will provide that XDRK is a routing option under which orders check the System for available shares and simultaneously route to certain destinations on the System routing table that are not posting Protected Quotations within the meaning of Regulation NMS (i.e. ‘‘dark venues’’ or ‘‘dark pools’’). If shares remain un-executed after routing, they are posted on the book. Once on the book, should the order subsequently be locked or crossed by another market center, the System will not route the order to the locking or crossing market center. This strategy is intended to attract market participants that seek to execute on PSX or on dark pools without executing on another exchange. Members may seek to execute in this manner to interact with resting liquidity in addition to that available on PSX, while also minimizing market impact and transaction fees. For example, if the National Best Bid/ Offer (‘‘NBBO’’) is $10.00–$10.01, and PSX, DarkVenueA and ARCA each offer 100 shares at $10.01, a XDRK order to buy 1000 shares at $10.01 IOC will be handled as follows: 100 shares for execution on PSX and 100 shares routed to DarkVenueA simultaneously at $10.01; the remaining 800 shares are not routed and not executed, and cancelled back to the entering participant because it was an IOC order. The order did not route to ARCA because it is not a dark venue. As a second example, if the NBBO is $10.00–$10.01, and PSX, DarkVenueA and ARCA each offer 100 shares at $10.01, a XDRK order to buy 1000 shares at $10.01 DAY will be handled as follows: 100 shares for execution on PSX and 100 shares routed to DarkVenueA simultaneously at $10.01; the remaining 800 shares are posted on the PSX book (because it is a DAY order). Once again, the order did not route to ARCA because it is not a dark venue. Proposed Rule 3315(a)(1)(A)(ix) will provide that XCST is a routing option under which orders check the System for available shares and simultaneously route to select dark venues and to certain low cost exchanges. If shares remain un-executed after routing, they 3 17 E:\FR\FM\12FEN1.SGM CFR 242.611. 12FEN1

Agencies

[Federal Register Volume 78, Number 29 (Tuesday, February 12, 2013)]
[Notices]
[Pages 9975-9977]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-03188]



[[Page 9975]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68854; File No. SR-CBOE-2013-010]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Extend the Individual Stock Trading Pause Pilot Program

February 6, 2013.
    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 January 28, 2013, Chicago Board Options Exchange, Incorporated 
(``CBOE'' or ``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.
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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.
(additions are italicized; deletions are [bracketed])
* * * * *

Chicago Board Options Exchange, Incorporated Rules

* * * * *
    1. Rule 6.3C--Individual Stock Trading Pause Due to Extraordinary 
Market Volatility
    2.
* * * * *
* * * Interpretations and Policies:
* * * * *
    .03 The provisions of this Rule shall be in effect for eligible NMS 
stocks during a pilot period ending on the earlier of the initial date 
of operations of the Regulation NMS Plan to Address Extraordinary 
Market Volatility or February 4, 2014[3]. The term ``eligible NMS 
stocks'' shall mean NMS stocks, other than rights and warrants. Trading 
in an eligible NMS stock will pause between the hours of 8:45 a.m. and 
2:35 p.m. (all times are CT), or in the case of an early scheduled 
close, 25 minutes before the close of trading, if the price of the 
stock moved by a percentage specified below within a five-minute period 
(``Threshold Move''), as calculated by the primary listing market as 
follows:
* * * * *
    The text of the proposed rule change is also 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.

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
    Rule 6.3C, Individual Stock Trading Pauses Due to Extraordinary 
Market Volatility, was approved by the Securities and Exchange 
Commission (``Commission'') on June 10, 2010 on a pilot basis. The 
pilot is currently set to expire on February 4, 2013.\3\ 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.\4\
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    \3\ 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); 66166 (January 17, 2012), 77 FR 
3311 (January 23, 2012)(SR-CBOE-2012-01)(extension of pilot through 
July 31, 2012); and 67574 (August 2, 2012), 77 FR 49848 (August 17, 
2012)(SR-CBOE-2012-069)(extension of pilot through February 4, 
2012).
    \4\ 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).
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    As the duration of the pilot expires on February 4, 2013, the 
Exchange is proposing to extend the effectiveness of Rule 6.3C until 
the earlier of the initial date of operations of the Regulation NMS 
Plan to Address Extraordinary Market Volatility or February 4, 2014. 
The pilot will continue to operate as to individual securities until 
such security is subject to the Regulation NMS Plan to Address 
Extraordinary Market Volatility. Extending the extension date would 
allow the pilot to continue to operate without interruption until 
implementation of the Regulation NMS Plan to Address Extraordinary 
Market Volatility.\5\ The Regulation NMS Plan to Address Extraordinary 
Market Volatility will not begin initial operations on February 4, 2013 
as initially planned, but has an amended anticipated implementation 
date of April 8, 2013.\6\ If the Regulation NMS Plan to Address 
Extraordinary Market Volatility has an initial date of operations 
before February 4, 2014, the proposed pilot for trading pauses will 
expire at that time.
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    \5\ See Securities Exchange Act Release No. 67091 (May 31, 
2012), 77 FR 33498 (June 6, 2012) (File No. 4-631) (Order Approving, 
on a Pilot Basis, the National Market System Plan To Address 
Extraordinary Market Volatility by BATS Exchange, Inc., BATS Y-
Exchange, Inc., Chicago Board Options Exchange, Incorporated, 
Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, 
Inc., Financial Industry Regulatory Authority, Inc., NASDAQ OMX BX, 
Inc., NASDAQ OMX PHLX LLC, The Nasdaq Stock Market LLC, National 
Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and 
NYSE Arca, Inc).
    \6\ See Letter from Janet M. McGinness, Executive Vice President 
and Corporate Secretary, General Counsel, NYSE Markets, to Elizabeth 
M. Murphy, Secretary, Commission, dated January 17, 2013.
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2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations thereunder applicable to the Exchange and, in particular, 
the requirements of Section 6(b) of the Act.\7\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section

[[Page 9976]]

6(b)(5) \8\ requirements that the rules of an 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 facilitation 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. Additionally, the Exchange 
believes the proposed rule change is consistent with the Section 
6(b)(5) \9\ requirement that the rules of an exchange not be designed 
to permit unfair discrimination between customers, issuers, brokers, or 
dealers.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
    \9\ Id.
---------------------------------------------------------------------------

    In particular, the Exchange believes that the change proposed 
herein meets these requirements in that it promotes uniformity across 
markets concerning decisions to pause trading in a security when there 
are significant price movements, which promotes just and equitable 
principles of trade and removes impediments to, and perfects the 
mechanism of, a free and open market and a national market system. 
Additionally, extension of the pilot until the earlier of the initial 
date of operations of the Regulation NMS Plan to Address Extraordinary 
Market Volatility or February 4, 2014 would allow the pilot to continue 
to operate without interruption while the Exchange and the Commission 
further assess the effect of the pilot on the marketplace or whether 
other initiatives should be adopted in lieu of the current pilot, which 
contributes to the protection of 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. The proposed changes are being 
made to extend the operation of the trading pause pilot until the 
earlier of the initial date of operations of the Regulation NMS Plan to 
Address Extraordinary Market Volatility or February 4, 2014 would allow 
the pilot to continue to operate without interruption until 
implementation of the Regulation NMS Plan to Address Extraordinary 
Market Volatility, which contributes to the protection of investors and 
the public interest. Other competing equity exchanges are subject to 
the same trading pause requirements specified in the Plan. Thus, the 
proposed changes will not impose any burden on competition while 
providing trading pause requirements specified in the Plan.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \10\ and Rule 19b-4(f)(6) thereunder.\11\ 
Because the proposed rule change does not: (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
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    \10\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
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) \12\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\13\ 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 because such waiver 
would allow the pilot program to continue uninterrupted. Accordingly, 
the Commission hereby grants the Exchange's request and designates the 
proposal operative upon filing.\14\
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    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
    \14\ 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 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-CBOE-2013-010 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-2013-010. 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

[[Page 9977]]

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 publicly available. All 
submissions should refer to File Number SR-CBOE-2013-010 and should be 
submitted on or before March 5, 2013.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-03188 Filed 2-11-13; 8:45 am]
BILLING CODE 8011-01-P
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