Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca Equities Rules 1.1, 7.31, 7.34, 7.35, 7.37 and 7.43 To Update Rules Related to the Exchange's Order Types and Modifiers, 23032-23034 [2014-09396]
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23032
Federal Register / Vol. 79, No. 80 / Friday, April 25, 2014 / Notices
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
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–NSX–
2014–11, and should be submitted on or
before May 16, 2014.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–09397 Filed 4–24–14; 8:45 am]
SECURITIES AND EXCHANGE
COMMISSION
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending NYSE Arca
Equities Rules 1.1, 7.31, 7.34, 7.35, 7.37
and 7.43 To Update Rules Related to
the Exchange’s Order Types and
Modifiers
April 21, 2014.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on April 8,
2014, NYSE Arca, Inc. (the ‘‘Exchange’’
or ‘‘NYSE Arca’’) filed with the
Securities and Exchange Commission
(the ‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the self-regulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
mstockstill on DSK4VPTVN1PROD with NOTICES
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.
1. Purpose
[Release No. 34–71982; File No. SR–
NYSEARCA–2014–39])
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
NYSE Arca Equities Rules 1.1, 7.31,
7.34, 7.35, 7.37 and 7.43 in order to
update rules related to the Exchange’s
order types and modifiers. The text of
the proposed rule change is available on
The Exchange proposes to amend
NYSE Arca Equities Rules 7.31, 7.34
and 7.35 4 to delete the Timed Modifier
and related references. Second, the
Exchange proposes to eliminate
references in Rules 1.1, 7.31, 7.34, 7.37,
and 7.43 to the Directed Order and
Directed Fill order types, which were
recently deleted.
Elimination of Timed Modifier and
References to Timed Order Rule
7.31(c)(2)(C)—Timed Modifier
The Exchange proposes to delete Rule
7.31(c)(2)(C), which describes the
operation of the Timed Modifier.
Because of the lack of use, the Exchange
proposes to eliminate the use of the
Timed Modifier and therefore proposes
to delete this functionality from its
rules. The Exchange believes that
deleting little-used functionality would
streamline its order processing and
reduce confusion of available
functionality.
The Exchange also proposes to delete
references to Timed Order in Rules 7.34
and 7.35. The Exchange recently
relocated the Timed Order from former
Rule 7.31(q) to its current location in
Rule 7.31(c)(2)(C) and changed the
description of the functionality to
‘‘Modifier’’ from ‘‘Order’’.5 Given the
elimination of Rule 7.31(c)(2)(C), the
4 All references to rules in this filing are to the
rules of NYSE Arca Equities.
5 See Securities Act Release No. 71331 (January
16, 2014), 79 FR 3907 (January 23, 2014) (SR–
NYSEArca–2013–92).
12 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
1 15
16:57 Apr 24, 2014
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
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following references to Timed Order
should be deleted:
• Rule 7.34(d)(1)(F), describing orders
permitted during the Opening Session;
• Rule 7.34(d)(2)(C), providing that
Timed Orders designated as good from
1:00 p.m. (Pacific Time) are not eligible
to participate in the Closing Auction;
• Rule 7.35(a)(2), providing that
Limited Price Orders designated for the
Opening Session and entered as a
Timed Order good from 1:00 a.m.
(Pacific Time) are not eligible for
execution during the Opening Auction
and Market Order Auction, respectively;
• Rule 7.35(b)(1), providing that
Limited Price Orders designated for the
Opening Session and entered as a
Timed Order good from 1:00 a.m.
(Pacific Time) are not eligible for
execution during the Opening Auction);
and
• Rule 7.35(b)(4), providing that a
Limited Price Orders designated for the
Opening Session and entered as a
Timed Order good from 6:30 a.m.
(Pacific Time) are not eligible for
execution during the Market Order
Auction.
The Exchange will announce by
Trader Update the date when the Timed
Modifier will no longer be available.
Elimination of References to Directed
Order and Directed Fill Order Types
The Directed Order and Directed Fill
order types were recently eliminated.6
The Exchange proposes to remove the
remaining references to these order
types in the following Rules.
Rule 1.1(a) and Rule 1.1(bbb)—
Definitions
The Exchange proposes to eliminate
references to the Directed Order Process
in Rule 1.1(a), which defines the NYSE
Arca Book, and Rule 1.1(bbb), which
defines a ‘‘Designated Market Maker’’ as
a registered Market Maker that
participates in the Directed Order
Process.
Rule 7.34(d)(1)(C) and Rule
7.34(d)(2)(A)—Trading Sessions
The Exchange proposes to eliminate
references to Directed Orders in Rule
7.34 to clarify that these order types are
no longer available during the Opening
and Core Trading Sessions on the
Exchange. Specifically, the Exchange
proposes to amend Rule 7.34(d)(1)(C) to
remove references to ‘‘market Directed
Orders’’, which are no longer included
in the Market Order Auction for
purposes of the Opening Session.
Similarly, the Exchange proposes to
amend Rule 7.34(d)(2)(A) to remove the
6 See
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reference to Directed Order and clarify
that such orders are no longer eligible
for entry and execution on the Exchange
during the Core Trading Session.
Rule 7.37(a)—Trading Sessions
The Exchange proposes to eliminate
the Directed Order Process in Rule
7.37(a), currently Step 1 in the process
of matching and executing like-priced
orders, bids and offers under the Rule.
With the elimination of the Directed
Order process, the Exchange proposes to
reduce the number of steps from 5 to 4
beginning with the Display Order
Process (formerly Step 2) as new Step 1
and continuing with the Working Order
Process (formerly Step 3) as new Step 2,
the Tracking Order Process (formerly
Step 4) as new Step 3, and Routing
Away (formerly Step 5) as the new Step
4. The proposed revision to Rule 7.37(a)
will also eliminate references to the
Directed Fill order type, which is no
longer available to Users on Exchange
systems.
mstockstill on DSK4VPTVN1PROD with NOTICES
Rule 7.43—Use of Directed Order
Process
The Exchange proposes to eliminate
Rule 7.43, which prohibits the use of the
Directed Order Process for the purpose
of bypassing otherwise applicable fees.
The Exchange is proposing eliminating
references to the Directed Order Process
since Directed Orders are order types
not available to Users on Exchange
systems.
2. Statutory Basis
The proposed rule change is
consistent with Section 6(b) 7 of the Act,
in general, and furthers the objectives of
Section 6(b)(5),8 in particular, in that 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
facilitating transactions in securities,
and to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system. Specifically, the Exchange
believes that removing cross-references
to the Directed Order and Directed Fill
order types, which the Exchange
recently eliminated in a separate rule
filing,9 would remove impediments to
and perfect the mechanism of a free and
open market because it would reduce
potential confusion that may result from
having such cross references in the
Exchange’s rulebook. Removing such
obsolete cross references will also
7 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
9 See supra note 5.
8 15
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16:57 Apr 24, 2014
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further the goal of transparency and add
clarity to the Exchange’s rules. The
Exchange also believes that removing
the Timed Modifier time-in-force
condition removes impediments to and
perfects a national market system by
eliminating little-used functionality
from its rulebook. The Exchange
believes that removing the Timed
Modifier would not be inconsistent with
the public interest and the protection of
investors because investors will not be
harmed by the removal of little-utilized
functionality.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change imposes any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
proposed change is not designed to
address any competitive issue but rather
would remove obsolete cross-references
and remove little-used functionality,
thereby reducing confusion and making
the Exchange’s rules easier to
understand and navigate.
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 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.12
10 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
12 17 CFR 240.19b–4(f)(6). As required under Rule
19b–4(f)(6)(iii), the Exchange provided the
Commission with written notice of its intent to file
the proposed rule change, along with a brief
description and the 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.
11 17
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23033
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. If the
Commission takes such action, the
Commission shall institute proceedings
under Section 19(b)(2)(B) 13 of the Act to
determine whether the proposed rule
change should be approved or
disapproved.
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–
NYSEARCA–2014–39 on the subject
line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEARCA–2014–39. 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 Section, 100 F Street NE.,
Washington, DC 20549–1090. Copies of
the filing will also be available for
inspection and copying at the NYSE’s
principal office and on its Internet Web
13 15
E:\FR\FM\25APN1.SGM
U.S.C. 78s(b)(2)(B).
25APN1
23034
Federal Register / Vol. 79, No. 80 / Friday, April 25, 2014 / Notices
site at www.nyse.com. 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–
NYSEARCA–2014–39 and should be
submitted on or before May 16, 2014.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–09396 Filed 4–24–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–71981; File No. SR–FINRA–
2014–019]
Self-Regulatory Organizations;
Financial Industry Regulatory
Authority, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Relating to Amending the
Security Futures Risk Disclosure
Statement
April 21, 2014.
mstockstill on DSK4VPTVN1PROD with NOTICES
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 April 8,
2014, Financial Industry Regulatory
Authority, Inc. (‘‘FINRA’’) 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
substantially prepared by FINRA.
FINRA has designated the proposed rule
change as constituting a ‘‘noncontroversial’’ rule change under
paragraph (f)(6) of Rule 19b–4 under the
Act,3 which renders the proposal
effective upon receipt of this filing by
the Commission. 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
FINRA is proposing to amend the
security futures risk disclosure
statement (‘‘Statement’’).
Below is the text of the proposed
supplement to the Statement reflecting
amendments to the current Section 5.2
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 17 CFR 240.19b–4(f)(6).
(Settlement by Physical Delivery). The
text of the proposed supplement is new.
*
*
*
*
*
April 2014 Supplement to the Security
Futures Risk Disclosure Statement
The October 2002 Security Futures
Risk Disclosure Statement is amended
as provided below.
The first paragraph under Section 5.2
(Settlement by Physical Delivery) is
replaced with the following paragraph:
Settlement by physical delivery is
carried out by clearing brokers or their
agents with National Securities Clearing
Corporation (NSCC), an SEC-regulated
securities clearing agency. Such
settlements are made in much the same
way as they are for purchases and sales
of the underlying security. Promptly
after the last day of trading, the
regulated exchange’s clearing
organization will report a purchase and
sale of the underlying stock at the
previous day’s settlement price (also
referred to as the ‘‘invoice price’’) to
NSCC. In general, if NSCC does not
reject the transaction by a time specified
in its rules, settlement is effected
pursuant to the rules of the exchange
and NSCC’s Rules and Procedures
within the normal clearance and
settlement cycle for securities
transactions, which currently is three
business days. However, settlement may
be effected on a shorter timeframe based
on the rules of the exchange and subject
to NSCC’s Rules and Procedures.
*
*
*
*
*
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
FINRA 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. FINRA 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
In 2002, FINRA developed sales
practice rules governing security
futures.4 Among those rules’
requirements is the obligation of a
14 17
1 15
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16:57 Apr 24, 2014
4 See Securities Exchange Act Release No. 46663
(October 15, 2002), 67 FR 64944 (October 22, 2002)
(Order Approving File No. SR–NASD–2002–040).
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member to deliver the current Statement
to each customer at or prior to the time
such customer’s account is approved for
trading security futures.5 Thereafter, the
member must distribute each new or
revised Statement to each customer
having an account approved for such
trading or, in the alternative, not later
than the time a confirmation of a
transaction is delivered to each
customer that enters into a security
futures transaction.6 FINRA guidance
provides that firms may separately
distribute new supplements to such
customers; firms are not required to
redistribute the entire Statement or
earlier supplements.7
The original Statement was approved
by the SEC in 2002,8 and the first
supplement to the Statement was added
in 2010.9 FINRA is proposing a second
supplement to the Statement (‘‘proposed
supplement’’) to accommodate proposed
changes by OneChicago, LLC, to list a
product with a physical delivery
settlement cycle shorter than three
business days. The proposed
supplement discloses that settlement by
physical delivery may be effected on a
timeframe shorter than three business
days based on the rules of the exchange
and subject to NSCC’s Rules and
Procedures. As with the previous
supplement to the Statement, the
proposed supplement is intended to be
read in conjunction with the Statement.
FINRA will announce the
implementation date of the proposed
rule change in a Regulatory Notice to be
published no later than 60 days
following Commission notice of the
filing of the rule change for immediate
effectiveness. The implementation date
will be no later than 90 days after the
date of the filing.
2. Statutory Basis
FINRA believes that the proposed rule
change is consistent with the provisions
of Section 15A(b)(6) of the Act,10 which
requires, among other things, that
FINRA rules must be designed to
prevent fraudulent and manipulative
5 FINRA
Rule 2370(b)(11).
6 Id.
7 See FINRA Information Notice, September 7,
2010 (August 2010 Supplement to the Security
Futures Risk Disclosure Statement).
8 See Securities Exchange Act Release No. 46612
(October 7, 2002), 67 FR 64151 (October 17, 2002)
(Notice of Filing and Summary Effectiveness of File
No. SR–NASD–2002–128).
9 The amendment added a supplement to the
Statement to accommodate changes by OneChicago,
LLC, to list a class of security futures for which
adjustments are made for ordinary dividends. See
Securities Exchange Act Release No. 62787 (August
27, 2010), 75 FR 53998 (September 2, 2010) (Notice
of Filing and Immediate Effectiveness of File No.
SR–FINRA–2010–045).
10 15 U.S.C. 78o–3(b)(6).
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]]>Agencies
[Federal Register Volume 79, Number 80 (Friday, April 25, 2014)]
[Notices]
[Pages 23032-23034]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-09396]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-71982; File No. SR-NYSEARCA-2014-39])
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca
Equities Rules 1.1, 7.31, 7.34, 7.35, 7.37 and 7.43 To Update Rules
Related to the Exchange's Order Types and Modifiers
April 21, 2014.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on April 8, 2014, NYSE Arca, Inc. (the ``Exchange'' or
``NYSE Arca'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend NYSE Arca Equities Rules 1.1, 7.31,
7.34, 7.35, 7.37 and 7.43 in order to update rules related to the
Exchange's order types and modifiers. 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 the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend NYSE Arca Equities Rules 7.31, 7.34
and 7.35 \4\ to delete the Timed Modifier and related references.
Second, the Exchange proposes to eliminate references in Rules 1.1,
7.31, 7.34, 7.37, and 7.43 to the Directed Order and Directed Fill
order types, which were recently deleted.
---------------------------------------------------------------------------
\4\ All references to rules in this filing are to the rules of
NYSE Arca Equities.
---------------------------------------------------------------------------
Elimination of Timed Modifier and References to Timed Order Rule
7.31(c)(2)(C)--Timed Modifier
The Exchange proposes to delete Rule 7.31(c)(2)(C), which describes
the operation of the Timed Modifier. Because of the lack of use, the
Exchange proposes to eliminate the use of the Timed Modifier and
therefore proposes to delete this functionality from its rules. The
Exchange believes that deleting little-used functionality would
streamline its order processing and reduce confusion of available
functionality.
The Exchange also proposes to delete references to Timed Order in
Rules 7.34 and 7.35. The Exchange recently relocated the Timed Order
from former Rule 7.31(q) to its current location in Rule 7.31(c)(2)(C)
and changed the description of the functionality to ``Modifier'' from
``Order''.\5\ Given the elimination of Rule 7.31(c)(2)(C), the
following references to Timed Order should be deleted:
---------------------------------------------------------------------------
\5\ See Securities Act Release No. 71331 (January 16, 2014), 79
FR 3907 (January 23, 2014) (SR-NYSEArca-2013-92).
---------------------------------------------------------------------------
Rule 7.34(d)(1)(F), describing orders permitted during the
Opening Session;
Rule 7.34(d)(2)(C), providing that Timed Orders designated
as good from 1:00 p.m. (Pacific Time) are not eligible to participate
in the Closing Auction;
Rule 7.35(a)(2), providing that Limited Price Orders
designated for the Opening Session and entered as a Timed Order good
from 1:00 a.m. (Pacific Time) are not eligible for execution during the
Opening Auction and Market Order Auction, respectively;
Rule 7.35(b)(1), providing that Limited Price Orders
designated for the Opening Session and entered as a Timed Order good
from 1:00 a.m. (Pacific Time) are not eligible for execution during the
Opening Auction); and
Rule 7.35(b)(4), providing that a Limited Price Orders
designated for the Opening Session and entered as a Timed Order good
from 6:30 a.m. (Pacific Time) are not eligible for execution during the
Market Order Auction.
The Exchange will announce by Trader Update the date when the Timed
Modifier will no longer be available.
Elimination of References to Directed Order and Directed Fill Order
Types
The Directed Order and Directed Fill order types were recently
eliminated.\6\ The Exchange proposes to remove the remaining references
to these order types in the following Rules.
---------------------------------------------------------------------------
\6\ See id.
---------------------------------------------------------------------------
Rule 1.1(a) and Rule 1.1(bbb)--Definitions
The Exchange proposes to eliminate references to the Directed Order
Process in Rule 1.1(a), which defines the NYSE Arca Book, and Rule
1.1(bbb), which defines a ``Designated Market Maker'' as a registered
Market Maker that participates in the Directed Order Process.
Rule 7.34(d)(1)(C) and Rule 7.34(d)(2)(A)--Trading Sessions
The Exchange proposes to eliminate references to Directed Orders in
Rule 7.34 to clarify that these order types are no longer available
during the Opening and Core Trading Sessions on the Exchange.
Specifically, the Exchange proposes to amend Rule 7.34(d)(1)(C) to
remove references to ``market Directed Orders'', which are no longer
included in the Market Order Auction for purposes of the Opening
Session. Similarly, the Exchange proposes to amend Rule 7.34(d)(2)(A)
to remove the
[[Page 23033]]
reference to Directed Order and clarify that such orders are no longer
eligible for entry and execution on the Exchange during the Core
Trading Session.
Rule 7.37(a)--Trading Sessions
The Exchange proposes to eliminate the Directed Order Process in
Rule 7.37(a), currently Step 1 in the process of matching and executing
like-priced orders, bids and offers under the Rule. With the
elimination of the Directed Order process, the Exchange proposes to
reduce the number of steps from 5 to 4 beginning with the Display Order
Process (formerly Step 2) as new Step 1 and continuing with the Working
Order Process (formerly Step 3) as new Step 2, the Tracking Order
Process (formerly Step 4) as new Step 3, and Routing Away (formerly
Step 5) as the new Step 4. The proposed revision to Rule 7.37(a) will
also eliminate references to the Directed Fill order type, which is no
longer available to Users on Exchange systems.
Rule 7.43--Use of Directed Order Process
The Exchange proposes to eliminate Rule 7.43, which prohibits the
use of the Directed Order Process for the purpose of bypassing
otherwise applicable fees. The Exchange is proposing eliminating
references to the Directed Order Process since Directed Orders are
order types not available to Users on Exchange systems.
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) \7\ of the
Act, in general, and furthers the objectives of Section 6(b)(5),\8\ in
particular, in that 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 facilitating transactions in securities, and to
remove impediments to and perfect the mechanism of a free and open
market and a national market system. Specifically, the Exchange
believes that removing cross-references to the Directed Order and
Directed Fill order types, which the Exchange recently eliminated in a
separate rule filing,\9\ would remove impediments to and perfect the
mechanism of a free and open market because it would reduce potential
confusion that may result from having such cross references in the
Exchange's rulebook. Removing such obsolete cross references will also
further the goal of transparency and add clarity to the Exchange's
rules. The Exchange also believes that removing the Timed Modifier
time-in-force condition removes impediments to and perfects a national
market system by eliminating little-used functionality from its
rulebook. The Exchange believes that removing the Timed Modifier would
not be inconsistent with the public interest and the protection of
investors because investors will not be harmed by the removal of
little-utilized functionality.
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\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(5).
\9\ See supra note 5.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change imposes
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. The proposed change is not
designed to address any competitive issue but rather would remove
obsolete cross-references and remove little-used functionality, thereby
reducing confusion and making the Exchange's rules easier to understand
and navigate.
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 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.\12\
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\10\ 15 U.S.C. 78s(b)(3)(A)(iii).
\11\ 17 CFR 240.19b-4(f)(6).
\12\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written
notice of its intent to file the proposed rule change, along with a
brief description and the 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.
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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. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \13\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\13\ 15 U.S.C. 78s(b)(2)(B).
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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-NYSEARCA-2014-39 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEARCA-2014-39. 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 Section, 100 F Street
NE., Washington, DC 20549-1090. Copies of the filing will also be
available for inspection and copying at the NYSE's principal office and
on its Internet Web
[[Page 23034]]
site at www.nyse.com. 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-NYSEARCA-2014-39 and should be submitted on or before May 16, 2014.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-09396 Filed 4-24-14; 8:45 am]
BILLING CODE 8011-01-P
