Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Order Approving a Proposed Rule Change, as Modified by Amendment No. 1 Thereto, Relating to Market-Maker Continuous Quoting Obligations, 22360-22361 [2013-08725]
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22360
Federal Register / Vol. 78, No. 72 / Monday, April 15, 2013 / Notices
Commission finds that good cause exists
for approving the proposed rule change
on an accelerated basis.
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act 26 that the
proposed rule change (SR–MIAX–2013–
15), as modified by Amendment No. 1,
is approved on an accelerated basis.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.27
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2013–08726 Filed 4–12–13; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–69350; File No. SR–C2–
2013–008]
Self-Regulatory Organizations; C2
Options Exchange, Incorporated;
Order Approving a Proposed Rule
Change, as Modified by Amendment
No. 1 Thereto, Relating to MarketMaker Continuous Quoting Obligations
April 9, 2013.
I. Introduction
On February 8, 2013, C2 Options
Exchange, Incorporated (‘‘C2’’ or
‘‘Exchange’’) 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
amend C2’s rules relating to MarketMaker 3 continuous quoting obligations.
The proposed rule change, as modified
by Amendment No. 1, was published for
comment in the Federal Register on
February 27, 2013.4 The Commission
did not receive any comment letters
regarding the proposal. This order
approves the proposed rule change.
II. Description of the Proposal
The Exchange proposes to amend its
rules to exclude intra-day add-on series
(‘‘Intra-day Adds’’) from Market-Makers’
continuous quoting obligations on the
day during which such series are added
26 15
U.S.C. 78f(b)(2).
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 C2 Rule 1.1 defines ‘‘Market-Maker’’ as ‘‘a
Participant registered with the Exchange for the
purpose of making markets in options contracts
traded on the Exchange and that is vested with the
rights and responsibilities specified in Chapter 8 of
[the C2] Rules.’’
4 See Securities Exchange Act Release No. 68964
(February 21, 2013), 78 FR 13389 (‘‘Notice’’).
sroberts on DSK5SPTVN1PROD with NOTICES
27 17
VerDate Mar<15>2010
17:00 Apr 12, 2013
Jkt 229001
for trading.5 In addition, the Exchange
proposes to permit Designated Primary
Market-Makers (‘‘DPMs’’) 6 to receive
participation entitlements in all Intraday Adds on the day during which such
series are added for trading provided
that the DPM elects to quote in such
series and otherwise satisfies the
requirements set forth in Rule 8.19(b).7
III. Discussion and Commission’s
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.8 In particular, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act,9 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 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.
According to C2, several MarketMakers have communicated to the
Exchange that their trading systems do
not automatically produce continuous
quotes in Intra-day Adds on the trading
day during which those series are added
and that the only way they could quote
in these series in the trading day during
which they were added would be to
shut down and restart their systems.10
Further, the Exchange states that
Market-Makers have indicated that the
work that would be required to modify
their systems to permit quoting in Intraday Adds would be significant and
costly.11 In addition, the Exchange
indicates that Intra-day Adds represent
only approximately 0.10% of the
average number of series listed on the
Exchange each trading day, and that
Market-Makers will still be obligated to
5 See id. at 13389. According to the Exchange,
Intra-day Adds are series that are added to the
Exchange system after the opening of the Exchange,
rather than prior to the beginning of trading. See id.
at 13389–90.
6 C2 Rule 1.1 defines ‘‘DPM’’ as ‘‘a Participant
organization that is approved by the Exchange to
function in allocated securities as a Market-Maker
(as defined in Rule 1.1) and is subject to the
obligations under Rule 8.17 or as otherwise
provided under the Rules.’’
7 See Notice, supra note 4, 78 FR at 13389.
8 In approving this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
9 15 U.S.C. 78f(b)(5).
10 See Notice, supra note 4, 78 FR at 13390.
11 See id.
PO 00000
Frm 00136
Fmt 4703
Sfmt 4703
provide continuous two-sided markets
in a substantial number of series in their
appointed classes.12
The Exchange believes that it would
be impracticable, particularly given that
a number of Market-Makers use their
systems to quote on multiple markets
and not solely on the Exchange, for
Market-Makers to turn off their entire
systems to accommodate quoting in
Intra-day Adds on the day during which
those series are added on the Exchange.
In addition, the Exchange believes this
would interfere with the continuity of
its market and reduce liquidity, which
would ultimately harm investors and
contradicts the purpose of the MarketMaker continuous quoting obligation.13
The Exchange does not believe that
the proposed rule change would
adversely affect the quality of the
Exchange’s markets or lead to a material
decrease in liquidity. Rather, the
Exchange believes that its current
market structure, with its high rate of
participation by Market-Makers, permits
the proposed rule change without fear of
losing liquidity. The Exchange also
believes that market-making activity and
liquidity could materially decrease
without the proposed rule change to
exclude Intra-day Adds from MarketMaker continuous quoting obligations
on the trading day during which they
are added for trading.14
The Exchange believes that this
proposed relief will encourage MarketMakers to continue appointments and
other Trading Permit Holders (‘‘TPHs’’)
to request Market-Maker appointments,
and, as a result, expand liquidity in
options classes listed on the Exchange
to the benefit of the Exchange and its
TPHs and public customers. The
Exchange believes that its MarketMakers would be disadvantaged without
this proposed relief, and that TPHs and
public customers would also be
disadvantaged if Market-Makers
withdrew from appointments in options
classes, resulting in reduced liquidity
and volume in these classes.15
In addition, the Exchange believes
that the proposed rule change to clarify
that Market-Makers may receive
participation entitlements in Intra-day
Adds on the day during which such
series are added for trading if they
satisfy the other entitlement
requirements as set forth in Exchange
rules, even if the rules do not require
the Market-Makers to continuously
quote in those series, will incentivize
Market-Makers to quote in series in
12 See
id. at 13391.
id. at 13390.
14 See id. at 13391.
15 See id.
13 See
E:\FR\FM\15APN1.SGM
15APN1
Federal Register / Vol. 78, No. 72 / Monday, April 15, 2013 / Notices
22361
008), as modified by Amendment No. 1,
is approved.
Percent
sroberts on DSK5SPTVN1PROD with NOTICES
which they are not required to quote,
which may increase liquidity in their
appointed classes.16
The Exchange’s proposal to exclude
Intra-day Adds from Market-Makers’
continuous electronic quoting
obligations on the day during which
such series are added for trading would
not affect Market-Makers’ other
obligations. For example, MarketMakers will still be required to engage
in activities that constitute a course of
dealings reasonably calculated to
contribute to the maintenance of a fair
and orderly market, including (1) to
compete with other Market-Makers to
improve markets in all series of options
classes comprising their appointments;
(2) to make markets that, absent changed
market conditions, will be honored in
accordance with firm quote rules; and
(3) to update market quotations in
response to changed market conditions
in their appointed options classes and to
assure that any market quote they cause
to be disseminated is accurate.17 In
addition, the proposed rule change
would not excuse a Market-Maker from
its obligation to submit a single quote or
to maintain continuous quotes in one or
more series of a class to which the
Market-Maker is appointed when called
upon by an Exchange official if, in the
judgment of such official, it is necessary
to do so in the interest of maintaining
a fair and orderly market.18
The Commission notes that the
Exchange indicates that Market-Makers
would be required to shut down and
restart their systems, or make costly
systems changes, in order to quote in
Intra-day Adds. A requirement for
Market-Makers to maintain continuous
electronic quotes in Intra-day Adds,
which represents a minor part of
Market-Makers’ overall obligations, may
not justify the system resources, or the
disruption to trading, the Exchange
states would be necessary to
accommodate quoting in Intra-day
Adds. Accordingly, the Commission
believes that the Exchange’s proposal
concerning Intra-day Adds would
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.
IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,19that the
proposed rule change (SR–C2–2013–
16 See
id.
C2 Rule 8.5(a).
18 See C2 Rule 8.5(d).
19 15 U.S.C. 78s(b)(2).
20 17 CFR 200.30–3(a)(12).
17 See
VerDate Mar<15>2010
18:04 Apr 12, 2013
Jkt 229001
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.20
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2013–08725 Filed 4–12–13; 8:45 am]
BILLING CODE 8011–01–P
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration #13530 and #13531]
U.S. Small Business
Administration.
ACTION: Notice.
AGENCY:
This is a notice of an
Administrative declaration of a disaster
for the State of Alabama dated 04/04/
2013.
Incident: Severe Storms.
Incident Period: 03/18/2013 through
03/19/2013.
Effective Date: 04/04/2013.
Physical Loan Application Deadline
Date: 06/03/2013.
Economic Injury (EIDL) Loan
Application Deadline Date: 01/06/2014.
ADDRESSES: Submit completed loan
applications to: U.S. Small Business
Administration, Processing and
Disbursement Center, 14925 Kingsport
Road, Fort Worth, TX 76155.
FOR FURTHER INFORMATION CONTACT: A.
Escobar, Office of Disaster Assistance,
U.S. Small Business Administration,
409 3rd Street SW., Suite 6050,
Washington, DC 20416.
SUPPLEMENTARY INFORMATION: Notice is
hereby given that as a result of the
Administrator’s disaster declaration,
applications for disaster loans may be
filed at the address listed above or other
locally announced locations.
The following areas have been
determined to be adversely affected by
the disaster:
Primary Counties: De Kalb, Etowah.
Contiguous Counties:
Alabama: Blount, Calhoun, Cherokee,
Jackson, Marshall, Saint Clair.
Georgia: Chattooga, Dade, Walker.
The Interest Rates are:
Percent
Frm 00137
Fmt 4703
Sfmt 4703
2.875
4.000
2.875
The States which received an EIDL
Declaration # are Alabama. Georgia.
SUMMARY:
PO 00000
Non-Profit Organizations Without Credit Available Elsewhere .....................................
For Economic Injury:
Businesses & Small Agricultural
Cooperatives Without Credit
Available Elsewhere ..............
Non-Profit Organizations Without Credit Available Elsewhere .....................................
2.875
The number assigned to this disaster for
physical damage is 13530 B and for economic injury is 13531 0.
Alabama Disaster #AL–00049
For Physical Damage:
Homeowners With Credit Available Elsewhere ......................
Homeowners Without Credit
Available Elsewhere ..............
Businesses With Credit Available Elsewhere ......................
Businesses
Without
Credit
Available Elsewhere ..............
Non-Profit Organizations With
Credit Available Elsewhere ...
(Catalog of Federal Domestic Assistance
Numbers 59002 and 59008)
Dated: April 4, 2013.
Karen G. Mills,
Administrator.
[FR Doc. 2013–08761 Filed 4–12–13; 8:45 am]
BILLING CODE 8025–01–P
SOCIAL SECURITY ADMINISTRATION
[Docket No. SSA–2012–0071]
Social Security Ruling, SSR 13–1p;
Titles II and XVI: Agency Processes for
Addressing Allegations of Unfairness,
Prejudice, Partiality, Bias, Misconduct,
or Discrimination by Administrative
Law Judges (ALJs); Correction
Social Security Administration.
Notice of Social Security Ruling;
Correction.
AGENCY:
ACTION:
The Social Security
Administration published a document
in the Federal Register of January 29,
2013, in FR Doc. 2013–01833, on page
6171, in the third column, the last line
of the document change ‘‘30 days’’ to
‘‘60 days’’.
SUMMARY:
Paul Kryglik,
Director, Office of Regulations, Social
Security Administration.
[FR Doc. 2013–08804 Filed 4–12–13; 8:45 am]
BILLING CODE 4191–02–P
DEPARTMENT OF STATE
[Public Notice 8273]
1.688
60-Day Notice of Proposed Information
Collection: PEPFAR Program
Expenditures
6.000
ACTION:
3.375
4.000
Notice of request for public
comment.
E:\FR\FM\15APN1.SGM
15APN1
]]>Agencies
[Federal Register Volume 78, Number 72 (Monday, April 15, 2013)]
[Notices]
[Pages 22360-22361]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-08725]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-69350; File No. SR-C2-2013-008]
Self-Regulatory Organizations; C2 Options Exchange, Incorporated;
Order Approving a Proposed Rule Change, as Modified by Amendment No. 1
Thereto, Relating to Market-Maker Continuous Quoting Obligations
April 9, 2013.
I. Introduction
On February 8, 2013, C2 Options Exchange, Incorporated (``C2'' or
``Exchange'') 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 amend C2's rules relating to Market-Maker \3\
continuous quoting obligations. The proposed rule change, as modified
by Amendment No. 1, was published for comment in the Federal Register
on February 27, 2013.\4\ The Commission did not receive any comment
letters regarding the proposal. This order approves the proposed rule
change.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ C2 Rule 1.1 defines ``Market-Maker'' as ``a Participant
registered with the Exchange for the purpose of making markets in
options contracts traded on the Exchange and that is vested with the
rights and responsibilities specified in Chapter 8 of [the C2]
Rules.''
\4\ See Securities Exchange Act Release No. 68964 (February 21,
2013), 78 FR 13389 (``Notice'').
---------------------------------------------------------------------------
II. Description of the Proposal
The Exchange proposes to amend its rules to exclude intra-day add-
on series (``Intra-day Adds'') from Market-Makers' continuous quoting
obligations on the day during which such series are added for
trading.\5\ In addition, the Exchange proposes to permit Designated
Primary Market-Makers (``DPMs'') \6\ to receive participation
entitlements in all Intra-day Adds on the day during which such series
are added for trading provided that the DPM elects to quote in such
series and otherwise satisfies the requirements set forth in Rule
8.19(b).\7\
---------------------------------------------------------------------------
\5\ See id. at 13389. According to the Exchange, Intra-day Adds
are series that are added to the Exchange system after the opening
of the Exchange, rather than prior to the beginning of trading. See
id. at 13389-90.
\6\ C2 Rule 1.1 defines ``DPM'' as ``a Participant organization
that is approved by the Exchange to function in allocated securities
as a Market-Maker (as defined in Rule 1.1) and is subject to the
obligations under Rule 8.17 or as otherwise provided under the
Rules.''
\7\ See Notice, supra note 4, 78 FR at 13389.
---------------------------------------------------------------------------
III. Discussion and Commission's 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.\8\
In particular, the Commission finds that the proposed rule change is
consistent with Section 6(b)(5) of the Act,\9\ 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 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.
---------------------------------------------------------------------------
\8\ In approving this proposal, the Commission has considered
the proposed rule's impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
\9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
According to C2, several Market-Makers have communicated to the
Exchange that their trading systems do not automatically produce
continuous quotes in Intra-day Adds on the trading day during which
those series are added and that the only way they could quote in these
series in the trading day during which they were added would be to shut
down and restart their systems.\10\ Further, the Exchange states that
Market-Makers have indicated that the work that would be required to
modify their systems to permit quoting in Intra-day Adds would be
significant and costly.\11\ In addition, the Exchange indicates that
Intra-day Adds represent only approximately 0.10% of the average number
of series listed on the Exchange each trading day, and that Market-
Makers will still be obligated to provide continuous two-sided markets
in a substantial number of series in their appointed classes.\12\
---------------------------------------------------------------------------
\10\ See Notice, supra note 4, 78 FR at 13390.
\11\ See id.
\12\ See id. at 13391.
---------------------------------------------------------------------------
The Exchange believes that it would be impracticable, particularly
given that a number of Market-Makers use their systems to quote on
multiple markets and not solely on the Exchange, for Market-Makers to
turn off their entire systems to accommodate quoting in Intra-day Adds
on the day during which those series are added on the Exchange. In
addition, the Exchange believes this would interfere with the
continuity of its market and reduce liquidity, which would ultimately
harm investors and contradicts the purpose of the Market-Maker
continuous quoting obligation.\13\
---------------------------------------------------------------------------
\13\ See id. at 13390.
---------------------------------------------------------------------------
The Exchange does not believe that the proposed rule change would
adversely affect the quality of the Exchange's markets or lead to a
material decrease in liquidity. Rather, the Exchange believes that its
current market structure, with its high rate of participation by
Market-Makers, permits the proposed rule change without fear of losing
liquidity. The Exchange also believes that market-making activity and
liquidity could materially decrease without the proposed rule change to
exclude Intra-day Adds from Market-Maker continuous quoting obligations
on the trading day during which they are added for trading.\14\
---------------------------------------------------------------------------
\14\ See id. at 13391.
---------------------------------------------------------------------------
The Exchange believes that this proposed relief will encourage
Market-Makers to continue appointments and other Trading Permit Holders
(``TPHs'') to request Market-Maker appointments, and, as a result,
expand liquidity in options classes listed on the Exchange to the
benefit of the Exchange and its TPHs and public customers. The Exchange
believes that its Market-Makers would be disadvantaged without this
proposed relief, and that TPHs and public customers would also be
disadvantaged if Market-Makers withdrew from appointments in options
classes, resulting in reduced liquidity and volume in these
classes.\15\
---------------------------------------------------------------------------
\15\ See id.
---------------------------------------------------------------------------
In addition, the Exchange believes that the proposed rule change to
clarify that Market-Makers may receive participation entitlements in
Intra-day Adds on the day during which such series are added for
trading if they satisfy the other entitlement requirements as set forth
in Exchange rules, even if the rules do not require the Market-Makers
to continuously quote in those series, will incentivize Market-Makers
to quote in series in
[[Page 22361]]
which they are not required to quote, which may increase liquidity in
their appointed classes.\16\
---------------------------------------------------------------------------
\16\ See id.
---------------------------------------------------------------------------
The Exchange's proposal to exclude Intra-day Adds from Market-
Makers' continuous electronic quoting obligations on the day during
which such series are added for trading would not affect Market-Makers'
other obligations. For example, Market-Makers will still be required to
engage in activities that constitute a course of dealings reasonably
calculated to contribute to the maintenance of a fair and orderly
market, including (1) to compete with other Market-Makers to improve
markets in all series of options classes comprising their appointments;
(2) to make markets that, absent changed market conditions, will be
honored in accordance with firm quote rules; and (3) to update market
quotations in response to changed market conditions in their appointed
options classes and to assure that any market quote they cause to be
disseminated is accurate.\17\ In addition, the proposed rule change
would not excuse a Market-Maker from its obligation to submit a single
quote or to maintain continuous quotes in one or more series of a class
to which the Market-Maker is appointed when called upon by an Exchange
official if, in the judgment of such official, it is necessary to do so
in the interest of maintaining a fair and orderly market.\18\
---------------------------------------------------------------------------
\17\ See C2 Rule 8.5(a).
\18\ See C2 Rule 8.5(d).
---------------------------------------------------------------------------
The Commission notes that the Exchange indicates that Market-Makers
would be required to shut down and restart their systems, or make
costly systems changes, in order to quote in Intra-day Adds. A
requirement for Market-Makers to maintain continuous electronic quotes
in Intra-day Adds, which represents a minor part of Market-Makers'
overall obligations, may not justify the system resources, or the
disruption to trading, the Exchange states would be necessary to
accommodate quoting in Intra-day Adds. Accordingly, the Commission
believes that the Exchange's proposal concerning Intra-day Adds would
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.
IV. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\19\ that the proposed rule change (SR-C2-2013-008), as modified by
Amendment No. 1, is approved.
---------------------------------------------------------------------------
\19\ 15 U.S.C. 78s(b)(2).
\20\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\20\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-08725 Filed 4-12-13; 8:45 am]
BILLING CODE 8011-01-P
