Self-Regulatory Organizations; Topaz Exchange, LLC; Notice of Filing of Proposed Minor Rule Violation Plan, 71689-71690 [2013-28570]
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Federal Register / Vol. 78, No. 230 / Friday, November 29, 2013 / Notices
states that this language allows bids and
offers for complex orders to be
expressed in any increment
whatsoever.5 To establish a minimum
quoting increment for complex orders,
CBOE proposes to revise CBOE Rule
6.42(4) to state that bids and offers for
complex orders may be expressed in any
net price increment that may not be less
than $0.01, which CBOE may determine
on a class-by-class basis and announce
to Trading Permit Holders (‘‘TPHs’’) via
Regulatory Circular.6 CBOE would
notify TPHs of the minimum quoting
increments for complex orders via
Regulatory Circular.7 CBOE would not
change the minimum quoting
increments for complex orders on an
intra-day basis.8
According to CBOE, many web-based
services that public customers use to
enter options orders do not permit the
entry of orders in sub-penny
increments, a limitation that other
market participants may not face.9
CBOE believes that the proposal will
establish a minimum complex order
quoting increment that all market
participants will be able to monitor and
in which all market participants will be
able to enter orders.10 In addition,
because CBOE’s electronic complex
order execution systems, the Complex
Order Book (‘‘COB’’) and Complex
Order Auction (‘‘COA’’), are not
configured to permit quoting in subpenny increments, the $0.01 minimum
increment would place electronic and
manually entered complex orders on an
even footing.11 CBOE also believes that
establishing a minimum quoting
increment of $0.01 will assure that price
improvement occurs at a meaningful
increment, and will prevent market
participants from jumping ahead of an
5 See
Notice 78 FR at 62887.
states that the rule would allow the
Exchange to establish uniform complex order
quoting increments within a class, and to set and
vary the minimum complex order quoting
increments for different classes in response to
different market conditions in those classes and to
encourage more trading in those classes. CBOE
notes that its rules currently allow it to establish
minimum quoting increments for complex orders in
options on the S&P 500 Index (‘‘SPX’’), the p.m.settled S&P 500 Index (‘‘SPXPM’’), and on the S&P
100 Index (‘‘OEX’’ and ‘‘XEO’’). See Notice 78 FR
at 62888 and CBOE Rule 6.42(4).
7 See Notice 78 FR at 62888.
8 See id. at note 4.
9 See Notice 78 FR at 62887.
10 See id.
11 See Notice 78 FR at 62887–62888. See also
CBOE Rules 6.53C(c)(ii) and 6.53C(d)(iii)(1)
(providing for quoting increments of no less than
$0.01 in the COB and Requests for Responses
(‘‘RFRs’’) in increments of no less than $0.01 in the
COA). CBOE notes that the $0.01 minimum
increment would prevent sophisticated market
participants from manually entering complex order
quotations in sub-penny amounts. See Notice 78 FR
at 62888, note 5.
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6 CBOE
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existing quote by providing a de
minimus amount of price
improvement.12
III. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange.13 In particular, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act,14 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. As
discussed above, CBOE Rule 6.42(4)
currently allows bids and offers for
complex orders to be expressed in any
increment, which potentially could
permit bids and offers for complex
orders to be expressed in increments
smaller than $0.01. In contrast, complex
orders entered in the COB and RFR
Responses to a COA auction may not be
entered in increments smaller than
$0.01.15 Thus, under CBOE’s current
rules, complex orders that are entered
manually potentially could be entered
in increments smaller than $0.01, while
complex order trading interest entered
electronically in the COB and the COA
may not be entered in increments
smaller than $0.01. By establishing a
$0.01 minimum quoting increment for
complex orders, the proposal is
designed to protect investors by
establishing a consistent minimum
quoting increment for complex orders
that are entered manually and complex
orders that are entered electronically
through the COB and COA.
IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,16 that the
proposed rule change (SR–CBOE–2013–
093) is approved.
12 See
Notice 78 FR at 62888.
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).
14 15 U.S.C. 78f(b)(5).
15 See CBOE Rules 6.53C(c)(ii) and (d)(iii)(1).
16 15 U.S.C. 78s(b)(2).
13 In
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71689
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.17
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2013–28573 Filed 11–27–13; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–70927; File No. 4–669]
Self-Regulatory Organizations; Topaz
Exchange, LLC; Notice of Filing of
Proposed Minor Rule Violation Plan
November 22, 2013.
Pursuant to Section 19(d)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19d–1(c)(2)
thereunder,2 notice is hereby given that
on November 14, 2013, Topaz Exchange,
LLC (d/b/a ISE Gemini) (the
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) a proposed minor rule
violation plan (‘‘MRVP’’) with sanctions
not exceeding $2,500 which would not
be subject to the provisions of Rule 19d–
1(c)(1) of the Act 3 requiring that a selfregulatory organization (‘‘SRO’’)
promptly file notice with the
Commission of any final disciplinary
action taken with respect to any person
or organization.4 In accordance with
Rule 19d–1(c)(2) under the Act,5 the
Exchange proposes to designate certain
specified rule violations as minor rule
violations, and requests that it be
relieved of the prompt reporting
requirements regarding such violations,
provided it gives notice of such
violations to the Commission on a
quarterly basis.
The Exchange proposes to include in
its MRVP the procedures and violations
currently included in Exchange Rule
1614 (‘‘Imposition of Fines for Minor
Rule Violations’’), which has been
17 17
CFR 200.30–3(a)(12).
U.S.C. 78s(d)(1).
2 17 CFR 240.19d–1(c)(2).
3 17 CFR 240.19d–1(c)(1).
4 The Commission adopted amendments to
paragraph (c) of Rule 19d–1 to allow SROs to
submit for Commission approval plans for the
abbreviated reporting of minor disciplinary
infractions. See Securities Exchange Act Release
No. 21013 (June 1, 1984), 49 FR 23828 (June 8,
1984). Any disciplinary action taken by an SRO
against any person for violation of a rule of the SRO
which has been designated as a minor rule violation
pursuant to such a plan filed with and declared
effective by the Commission shall not be considered
‘‘final’’ for purposes of Section 19(d)(1) of the Act
if the sanction imposed consists of a fine not
exceeding $2,500 and the sanctioned person has not
sought an adjudication, including a hearing, or
otherwise exhausted his administrative remedies.
5 17 CFR 240.19d–1(c)(2).
1 15
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71690
Federal Register / Vol. 78, No. 230 / Friday, November 29, 2013 / Notices
sroberts on DSK5SPTVN1PROD with NOTICES
incorporated by reference from the
International Securities Exchange’s rule
book.6 According to the Exchange’s
MRVP, under Rule 1614, the Exchange
may impose a fine (not to exceed
$2,500) on any Member, or person
associated with or employed by a
Member, for any rule listed in Rule
1614(d).7 The Exchange shall serve the
person against whom a fine is imposed
with a written statement setting forth
the rule or rules violated, the act or
omission constituting each such
violation, the fine imposed, and the date
by which such determination becomes
final or by which such determination
must be contested. If the person against
whom the fine is imposed pays the fine,
such payment shall be deemed to be a
waiver of such person’s right to a
disciplinary proceeding and any review
of the matter under the Exchange rules.
Any person against whom a fine is
imposed may contest the Exchange’s
determination by filing with the
Exchange a written answer, at which
point the matter shall become a
disciplinary proceeding.
The Exchange proposes that, as set
forth in Exchange Rule 1614(d),
violations of the following rules would
be appropriate for disposition under the
MRVP: Rule 412 (Position Limits); Rule
415 (Reports Related to Position Limits);
Rule 1403 (Focus Reports); Rule 1404
(Requests for Trade Data); Conduct and
Decorum Policies; Rule 717 (Order
Entry); Rule 803 (Quotation Parameters);
Rule 805 (Execution of Orders in
Appointed Options); Rule 419
(Mandatory Systems Testing); and Rule
1100 (Exercise of Options Contracts).
Upon the Commission’s declaration of
effectiveness of the MRVP, the Exchange
will provide to the Commission a
quarterly report for any actions taken on
minor rule violations under the MRVP.
The quarterly report will include: the
Exchange’s internal file number for the
case, the name of the individual and/or
organization, the nature of the violation,
the specific rule provision violated, the
sanction imposed, the number of times
the rule violation occurred, and the date
of the disposition.
The Exchange also proposes that,
going forward, to the extent that there
are any changes to the rules applicable
to the Exchange’s MRVP, the Exchange
requests that the Commission deem
6 As noted above, the Exchange received its grant
of registration on July 26, 2013, which included
approving the rules that govern the Exchange.
7 While Rule 1614 allows the Exchange to
administer fines up to $5,000, the Exchange is only
seeking relief from the reporting requirements of
paragraph (c)(1) of Rule 19d–1 for fines
administered under Rule 1614(d) that do not exceed
$2,500.
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17:56 Nov 27, 2013
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such changes to be modifications to the
Exchange’s MRVP.
I. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the Exchange’s
proposed MRVP, including whether the
proposed MRVP is consistent with the
Act. Comments may be submitted by
any of the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File No. 4–669
on the subject line.
Paper Comments
II. Date of Effectiveness of the Proposed
Minor Rule Violation Plan and Timing
for Commission Action
Pursuant to Section 19(d)(1) of the Act
and Rule 19d–1(c)(2) thereunder,8 after
December 20, 2013, the Commission
may, by order, declare the Exchange’s
proposed MRVP effective if the plan is
consistent with the public interest, the
protection of investors, or otherwise in
furtherance of the purposes of the Act.
The Commission in its order may
restrict the categories of violations to be
designated as minor rule violations and
may impose any other terms or
conditions to the proposed MRVP, File
No. 4–669, and to the period of its
effectiveness, which the Commission
deems necessary or appropriate in the
public interest, for the protection of
investors or otherwise in furtherance of
the purposes of the Act.
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street NE., Washington, DC
20549–1090.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Kevin M. O’Neill,
Deputy Secretary.
All submissions should refer to File No.
4–669. 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 MRVP that
are filed with the Commission, and all
written communications relating to the
proposed MRVP 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
proposed MRVP also will be available
for inspection and copying at the
principal office of the Exchange. All
comments received will be posted
without change; the Commission does
not edit personal identifying
information from submissions. You
should submit only information that
you wish to make available publicly. All
submissions should refer to File No. 4–
669 and should be submitted on or
before December 20, 2013.
BILLING CODE 8011–01–P
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[FR Doc. 2013–28570 Filed 11–27–13; 8:45 am]
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–70926; File No. SR–
NASDAQ–2013–141]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change Relating to
NOM Market Maker Penny Pilot
Options Rebate To Add Liquidity
November 22, 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 November
13, 2013, The NASDAQ Stock Market
LLC (‘‘NASDAQ’’ or ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (‘‘SEC’’ or ‘‘Commission’’)
the proposed rule change as described
in Items I, II, and III, below, which Items
have been prepared by NASDAQ. 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
NASDAQ proposes to modify Chapter
XV, entitled ‘‘Options Pricing,’’ at
8 15
U.S.C. 78s(d)(1); 17 CFR 240.19d–1(c)(2).
CFR 200.30–3(a)(44).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
9 17
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Agencies
[Federal Register Volume 78, Number 230 (Friday, November 29, 2013)]
[Notices]
[Pages 71689-71690]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-28570]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-70927; File No. 4-669]
Self-Regulatory Organizations; Topaz Exchange, LLC; Notice of
Filing of Proposed Minor Rule Violation Plan
November 22, 2013.
Pursuant to Section 19(d)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19d-1(c)(2) thereunder,\2\ notice is hereby
given that on November 14, 2013, Topaz Exchange, LLC (d/b/a ISE Gemini)
(the ``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') a proposed minor rule violation plan (``MRVP'') with
sanctions not exceeding $2,500 which would not be subject to the
provisions of Rule 19d-1(c)(1) of the Act \3\ requiring that a self-
regulatory organization (``SRO'') promptly file notice with the
Commission of any final disciplinary action taken with respect to any
person or organization.\4\ In accordance with Rule 19d-1(c)(2) under
the Act,\5\ the Exchange proposes to designate certain specified rule
violations as minor rule violations, and requests that it be relieved
of the prompt reporting requirements regarding such violations,
provided it gives notice of such violations to the Commission on a
quarterly basis.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(d)(1).
\2\ 17 CFR 240.19d-1(c)(2).
\3\ 17 CFR 240.19d-1(c)(1).
\4\ The Commission adopted amendments to paragraph (c) of Rule
19d-1 to allow SROs to submit for Commission approval plans for the
abbreviated reporting of minor disciplinary infractions. See
Securities Exchange Act Release No. 21013 (June 1, 1984), 49 FR
23828 (June 8, 1984). Any disciplinary action taken by an SRO
against any person for violation of a rule of the SRO which has been
designated as a minor rule violation pursuant to such a plan filed
with and declared effective by the Commission shall not be
considered ``final'' for purposes of Section 19(d)(1) of the Act if
the sanction imposed consists of a fine not exceeding $2,500 and the
sanctioned person has not sought an adjudication, including a
hearing, or otherwise exhausted his administrative remedies.
\5\ 17 CFR 240.19d-1(c)(2).
---------------------------------------------------------------------------
The Exchange proposes to include in its MRVP the procedures and
violations currently included in Exchange Rule 1614 (``Imposition of
Fines for Minor Rule Violations''), which has been
[[Page 71690]]
incorporated by reference from the International Securities Exchange's
rule book.\6\ According to the Exchange's MRVP, under Rule 1614, the
Exchange may impose a fine (not to exceed $2,500) on any Member, or
person associated with or employed by a Member, for any rule listed in
Rule 1614(d).\7\ The Exchange shall serve the person against whom a
fine is imposed with a written statement setting forth the rule or
rules violated, the act or omission constituting each such violation,
the fine imposed, and the date by which such determination becomes
final or by which such determination must be contested. If the person
against whom the fine is imposed pays the fine, such payment shall be
deemed to be a waiver of such person's right to a disciplinary
proceeding and any review of the matter under the Exchange rules. Any
person against whom a fine is imposed may contest the Exchange's
determination by filing with the Exchange a written answer, at which
point the matter shall become a disciplinary proceeding.
---------------------------------------------------------------------------
\6\ As noted above, the Exchange received its grant of
registration on July 26, 2013, which included approving the rules
that govern the Exchange.
\7\ While Rule 1614 allows the Exchange to administer fines up
to $5,000, the Exchange is only seeking relief from the reporting
requirements of paragraph (c)(1) of Rule 19d-1 for fines
administered under Rule 1614(d) that do not exceed $2,500.
---------------------------------------------------------------------------
The Exchange proposes that, as set forth in Exchange Rule 1614(d),
violations of the following rules would be appropriate for disposition
under the MRVP: Rule 412 (Position Limits); Rule 415 (Reports Related
to Position Limits); Rule 1403 (Focus Reports); Rule 1404 (Requests for
Trade Data); Conduct and Decorum Policies; Rule 717 (Order Entry); Rule
803 (Quotation Parameters); Rule 805 (Execution of Orders in Appointed
Options); Rule 419 (Mandatory Systems Testing); and Rule 1100 (Exercise
of Options Contracts).
Upon the Commission's declaration of effectiveness of the MRVP, the
Exchange will provide to the Commission a quarterly report for any
actions taken on minor rule violations under the MRVP. The quarterly
report will include: the Exchange's internal file number for the case,
the name of the individual and/or organization, the nature of the
violation, the specific rule provision violated, the sanction imposed,
the number of times the rule violation occurred, and the date of the
disposition.
The Exchange also proposes that, going forward, to the extent that
there are any changes to the rules applicable to the Exchange's MRVP,
the Exchange requests that the Commission deem such changes to be
modifications to the Exchange's MRVP.
I. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the Exchange's proposed MRVP, including whether
the proposed MRVP is consistent with the Act. Comments may be submitted
by any of the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File No. 4-669 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File No. 4-669. 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 MRVP that are filed with the
Commission, and all written communications relating to the proposed
MRVP 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 proposed MRVP also will be available for
inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File No. 4-669 and should be submitted on
or before December 20, 2013.
II. Date of Effectiveness of the Proposed Minor Rule Violation Plan and
Timing for Commission Action
Pursuant to Section 19(d)(1) of the Act and Rule 19d-1(c)(2)
thereunder,\8\ after December 20, 2013, the Commission may, by order,
declare the Exchange's proposed MRVP effective if the plan is
consistent with the public interest, the protection of investors, or
otherwise in furtherance of the purposes of the Act. The Commission in
its order may restrict the categories of violations to be designated as
minor rule violations and may impose any other terms or conditions to
the proposed MRVP, File No. 4-669, and to the period of its
effectiveness, which the Commission deems necessary or appropriate in
the public interest, for the protection of investors or otherwise in
furtherance of the purposes of the Act.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78s(d)(1); 17 CFR 240.19d-1(c)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
---------------------------------------------------------------------------
\9\ 17 CFR 200.30-3(a)(44).
---------------------------------------------------------------------------
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-28570 Filed 11-27-13; 8:45 am]
BILLING CODE 8011-01-P