Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change Amending Rule 902.1NY To Authorize the Exchange To Share Any User-Designated Risk Settings in Exchange Systems With the Clearing Member That Clears Transactions on Behalf of the User, 60553-60555 [2014-23839]

Download as PDF Federal Register / Vol. 79, No. 194 / Tuesday, October 7, 2014 / Notices furnish to Clearing Members that guarantee that User’s transactions on the Exchange the User-designated risk settings in OX, including Risk Limitation Mechanism settings, which are designed to mitigate the potential risks of multiple executions against a User’s trading interest that, in today’s highly automated and electronic trading environment, can occur simultaneously across multiple series and multiple option classes. The Exchange believes that the proposal is consistent with the protection of investors and the public interests because it will permit Clearing Members with a financial interest in a User’s risk settings to better monitor and manage the potential risks assumed by Users with whom the Clearing Member has entered into a Clearing Letter of Consent, thereby providing Clearing Members with greater control and flexibility over setting their own risk tolerance and exposure. B. Self-Regulatory Organization’s Statement on Burden on Competition asabaliauskas on DSK5VPTVN1PROD with NOTICES The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change is not designed to address any competitive issues, but would provide authority for the Exchange to directly share risk settings with Clearing Members regarding the Users with whom the Clearing Member has executed a Clearing Letter of Consent so the Clearing Member can better monitor and manage the potential risks assumed by these Users, thereby providing them with greater control and flexibility over setting their own risk tolerance and exposure. Nonetheless, the proposal does not pose an undue burden on non-Clearing Members because, unlike Clearing Members, nonClearing Members do not guarantee the execution of the User transactions on the Exchange. The proposal is structured to offer the same enhancement to all Clearing Members, regardless of size, and would not impose a competitive burden on any participant. 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. VerDate Sep<11>2014 17:15 Oct 06, 2014 Jkt 235001 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve or disapprove the proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments 60553 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– NYSEArca–2014–110, and should be submitted on or before October 28, 2014. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.11 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2014–23840 Filed 10–6–14; 8:45 am] 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 BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–73280; File No. SR– NYSEMKT–2014–81] • 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–2014–110 on the subject line. Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change Amending Rule 902.1NY To Authorize the Exchange To Share Any User-Designated Risk Settings in Exchange Systems With the Clearing Member That Clears Transactions on Behalf of the User Paper Comments October 1, 2014. • 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-2014–110. 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 20549–1090, on official business days between the hours of 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 September 19, 2014, NYSE MKT LLC (the ‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the selfregulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. PO 00000 Frm 00110 Fmt 4703 Sfmt 4703 I. Self-Regulatory Organization’s Statement of the Terms of the Substance of the Proposed Rule Change The Exchange proposes to amend Rule 902.1NY (Admission to the System) to authorize the Exchange to share any User-designated risk settings in Exchange systems with the Clearing Member that clears transactions on behalf of the User. The text of the 11 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 E:\FR\FM\07OCN1.SGM 07OCN1 60554 Federal Register / Vol. 79, No. 194 / Tuesday, October 7, 2014 / Notices 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. asabaliauskas on DSK5VPTVN1PROD with NOTICES A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Rule 902.1NY (Admission to the System) to authorize the Exchange to share any User-designated risk settings in Exchange systems with the Clearing Member that clears transactions on behalf of the User. Rule 902.1NY states that ‘‘[u]nless otherwise provided in the Rules, no one but a User shall effect any transaction on the System.’’ 4 ‘‘System’’ refers to the Exchange System facility.5 The Exchange proposes to amend the current rule by adding the following sentence: ‘‘The Exchange may share any Userdesignated risk settings in the System with the Clearing Member that clears transactions on behalf of the User.’’ 6 A ‘‘User’’ is ‘‘any ATP Holder that is authorized to obtain access to the System pursuant to Rule 902.1NY.’’ 7 Each User that transacts through a Clearing Member on the Exchange executes a Clearing Letter of Consent, which ‘‘shall be deemed a letter of guarantee, letter of authorization, or notice of consent pursuant to NYSE MKT Rules and may be relied upon by NYSE Amex Options, the [National Securities Clearing Corporation], the [Options Clearing Corporation], and their respective members.’’ 8 The Exchange believes that because Clearing Rule 902.1NY. Rule 900.1NY. 6 See proposed Rule 902.1NY. 7 See Rule 900.2NY(87). 8 See NYSE Amex Options ATP Application, Section 8 (Clearing Letter of Consent), available here, https://www.nyse.com/publicdocs/nyse/ markets/amex-options/ATP_Application.pdf. Members that execute a Clearing Letter of Consent guarantee all transactions of those Users, and therefore bear the risk associated with those transactions, it is appropriate for Clearing Members to have knowledge of what risk settings a User may utilize within Exchange systems. At this time, the risk settings covered by this proposal are set forth in Rule 6.40 [sic] (Risk Limitation Mechanism).9 Pursuant to Rule 928NY(b)–(d), Users may set certain risk control thresholds in the Risk Limitation Mechanism, which are designed to mitigate the potential risks of multiple executions against a User’s trading interest that, in today’s highly automated and electronic trading environment, can occur simultaneously across multiple series and multiple option classes. As proposed, the Exchange may share a User’s Risk Limitation Mechanism settings with the Clearing Member that guarantees the User’s transactions on the Exchange, and therefore has a financial interest in understanding the risk tolerance of the User. Because the Clearing Letter of Consent codifies relationships between each User and Clearing Member, the Exchange is on notice of which Clearing Members have relationships with which Users. The proposed rule change would simply provide the Exchange with authority to directly provide Clearing Members with information that may otherwise be available to such Clearing Members by virtue of their relationship with the respective Users. 2. Statutory Basis The statutory basis for the proposed rule change is Section 6(b)(5) of the Securities Exchange Act of 1934 (the ‘‘Act’’), in general, and furthers the objectives of Section 6(b)(5),10 which requires the rules of an exchange 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. The Exchange believes that the proposed rule change removes impediments to and perfects the mechanism of a free and open market by codifying that the Exchange can directly furnish to Clearing Members that 4 See 5 See VerDate Sep<11>2014 17:15 Oct 06, 2014 Jkt 235001 9 The Exchange may adopt additional rules providing for User-enabled risk settings that would be covered under this proposal. The Exchange will announce via Trader Update any additional risk settings (i.e., other than Rule 928NY(b)–(d)) that are adopted and covered by proposed Rule 902.1NY. 10 15 U.S.C. 78f(b)(5). PO 00000 Frm 00111 Fmt 4703 Sfmt 4703 guarantee that User’s transactions on the Exchange the User-designated risk settings in OX, including Risk Limitation Mechanism settings, which are designed to mitigate the potential risks of multiple executions against a User’s trading interest that, in today’s highly automated and electronic trading environment, can occur simultaneously across multiple series and multiple option classes. The Exchange believes that the proposal is consistent with the protection of investors and the public interests because it will permit Clearing Members with a financial interest in a User’s risk settings to better monitor and manage the potential risks assumed by Users with whom the Clearing Member has entered into a Clearing Letter of Consent, thereby providing Clearing Members with greater control and flexibility over setting their own risk tolerance and exposure. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change is not designed to address any competitive issues, but would provide authority for the Exchange to directly share risk settings with Clearing Members regarding the Users with whom the Clearing Member has executed a Clearing Letter of Consent so the Clearing Member can better monitor and manage the potential risks assumed by these Users, thereby providing them with greater control and flexibility over setting their own risk tolerance and exposure. Nonetheless, the proposal does not pose an undue burden on non-Clearing Members because, unlike Clearing Members, nonClearing Members do not guarantee the execution of the User transactions on the Exchange. The proposal is structured to offer the same enhancement to all Clearing Members, regardless of size, and would not impose a competitive burden on any participant. 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 Within 45 days of the date of publication of this notice in the Federal E:\FR\FM\07OCN1.SGM 07OCN1 Federal Register / Vol. 79, No. 194 / Tuesday, October 7, 2014 / Notices Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve or disapprove the proposed rule change, or (B) Institute proceedings to determine whether the proposed rule change should be disapproved. identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR– NYSEMKT–2014–81, and should be submitted on or before October 28, 2014. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.11 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2014–23839 Filed 10–6–14; 8:45 am] 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–NYSEMKT–2014–81 on the subject line. asabaliauskas on DSK5VPTVN1PROD with NOTICES 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: Consolidated Tape Association; Notice of Filing and Immediate Effectiveness of the Twentieth Substantive Amendment to the Second Restatement of the CTA Plan and Fourteenth Substantive Amendment to the Restated CQ Plan 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–NYSEMKT–2014–81. 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 inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal Pursuant to Section 11A of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 608 thereunder,2 notice is hereby given that on August 06, 2014, the Chicago Board Options Exchange, Incorporated, on behalf of Participants in the Second Restatement of the Consolidated Tape Association (‘‘CTA’’) Plan and the Restated Consolidated Quotation (‘‘CQ’’) Plan (collectively the ‘‘Participants’’) 3 filed with the Securities and Exchange Commission (‘‘Commission’’) a proposal to amend the Second Restatement of the CTA Plan and Restated CQ Plan (collectively, the ‘‘Plans’’).4 These VerDate Sep<11>2014 17:15 Oct 06, 2014 Jkt 235001 BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–73285; File No. SR–CTA/ CQ–2014–02] October 1, 2014. 11 17 CFR 200.30–3(a)(12). U.S.C. 78k–1. 2 17 CFR 242.608. 3 Each participant executed the proposed amendment. The Participants are: BATS Exchange, Inc., BATS–Y Exchange, Inc., Chicago Board Options Exchange, Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc. (‘‘EDGA’’), EDGX Exchange, Inc. (‘‘EDGX’’), Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’), International Securities Exchange, LLC, NASDAQ OMX BX, Inc. (‘‘Nasdaq BX’’), NASDAQ OMX PHLX, Inc. (‘‘Nasdaq PSX’’), Nasdaq Stock Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC (‘‘NYSE’’), NYSE Arca, Inc. and NYSE MKT LLC (formerly NYSE Amex, Inc.). 4 See Securities Exchange Act Release Nos. 10787 (May 10, 1974), 39 FR 17799 (May 20, 1974) (declaring the CTA Plan effective); 15009 (July 28, 1978), 43 FR 34851 (August 7, 1978) (temporarily authorizing the CQ Plan); and 16518 (January 22, 1980), 45 FR 6521 (January 28, 1980) (permanently authorizing the CQ Plan). The most recent restatement of both Plans was in 1995. The CTA Plan, pursuant to which markets collect and 1 15 PO 00000 Frm 00112 Fmt 4703 Sfmt 4703 60555 amendments represent Substantive Amendment No. 20 to the CTA Plan and Substantive Amendment No. 14 to the CQ Plan (collectively ‘‘the Amendments’’). The Amendments propose to change certain of the voting requirements under the CTA Plan and the CQ Plan. The Commission is publishing this notice to solicit comments from interested persons on the proposed Amendments. I. Rule 608(a) A. Description and Purpose of the Amendments The Amendments propose (a) to change the vote required under both the CTA Plan and the CQ Plan to amend the capacity planning process from a unanimous vote to the affirmative vote of a majority of all Participants entitled to vote, (b) to change the voting requirement needed to reduce a fee under both the CTA Plan and the CQ Plan from unanimity to the affirmative vote of two-thirds of all Participants entitled to vote, and (c) to change the voting requirement needed to establish a new fee or to delete an existing fee under the CQ Plan from unanimity to the affirmative vote of two-thirds of all Participants entitled to vote. In the Participants’ view, a majority vote, rather than unanimity is the appropriate requirement for changes to the capacity plan, as it provides greater flexibility to CTA and the CQ Plan’s Operating Committee to revise the capacity plan when they find it beneficial to do so. The Participants note that the Nasdaq/UTP Plan subjects changes to capacity planning to a majority vote. Similarly, the Participants view a twothirds vote, rather than unanimity, as the appropriate requirement to reduce or eliminate an existing fee or to establish a new fee. Both plans subject raising an existing fee to a two-thirds vote and currently subject reducing an existing fee to a unanimous vote. The CTA Plan currently subjects establishing a new fee or eliminating an existing fee to a two-thirds vote. The CQ Plan currently provides for a two-thirds vote to reduce the Network B interrogation device fee, but requires unanimity to reduce other CQ Plan fees or to eliminate a fee. The Amendments disseminate last sale price information for nonNASDAQ listed securities, is a ‘‘transaction reporting plan’’ under Rule 601 under the Act, 17 CFR 242.601, and a ‘‘national market system plan’’ under Rule 608 under the Act, 17 CFR 242.608. The CQ Plan, pursuant to which markets collect and disseminate bid/ask quotation information for listed securities, is a ‘‘national market system plan’’ under Rule 608 under the Act, 17 CFR 242.608. E:\FR\FM\07OCN1.SGM 07OCN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 79, Number 194 (Tuesday, October 7, 2014)]
[Notices]
[Pages 60553-60555]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-23839]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-73280; File No. SR-NYSEMKT-2014-81]

Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of
Proposed Rule Change Amending Rule 902.1NY To Authorize the Exchange To
Share Any User-Designated Risk Settings in Exchange Systems With the
Clearing Member That Clears Transactions on Behalf of the User

October 1, 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 September 19, 2014, NYSE MKT LLC (the ``Exchange'' or
``NYSE MKT'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III 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 the
Substance of the Proposed Rule Change

The Exchange proposes to amend Rule 902.1NY (Admission to the
System) to authorize the Exchange to share any User-designated risk
settings in Exchange systems with the Clearing Member that clears
transactions on behalf of the User. The text of the

[[Page 60554]]

proposed rule change is available on the Exchange's Web site at
www.nyse.com, at the principal office of the Exchange, and at the
Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
The Exchange proposes to amend Rule 902.1NY (Admission to the
System) to authorize the Exchange to share any User-designated risk
settings in Exchange systems with the Clearing Member that clears
transactions on behalf of the User.
Rule 902.1NY states that ``[u]nless otherwise provided in the
Rules, no one but a User shall effect any transaction on the System.''
\4\ ``System'' refers to the Exchange System facility.\5\ The Exchange
proposes to amend the current rule by adding the following sentence:
``The Exchange may share any User-designated risk settings in the
System with the Clearing Member that clears transactions on behalf of
the User.'' \6\ A ``User'' is ``any ATP Holder that is authorized to
obtain access to the System pursuant to Rule 902.1NY.'' \7\
---------------------------------------------------------------------------

\4\ See Rule 902.1NY.
\5\ See Rule 900.1NY.
\6\ See proposed Rule 902.1NY.
\7\ See Rule 900.2NY(87).
---------------------------------------------------------------------------

Each User that transacts through a Clearing Member on the Exchange
executes a Clearing Letter of Consent, which ``shall be deemed a letter
of guarantee, letter of authorization, or notice of consent pursuant to
NYSE MKT Rules and may be relied upon by NYSE Amex Options, the
[National Securities Clearing Corporation], the [Options Clearing
Corporation], and their respective members.'' \8\ The Exchange believes
that because Clearing Members that execute a Clearing Letter of Consent
guarantee all transactions of those Users, and therefore bear the risk
associated with those transactions, it is appropriate for Clearing
Members to have knowledge of what risk settings a User may utilize
within Exchange systems.
---------------------------------------------------------------------------

\8\ See NYSE Amex Options ATP Application, Section 8 (Clearing
Letter of Consent), available here, https://www.nyse.com/publicdocs/nyse/markets/amex-options/ATP_Application.pdf.
---------------------------------------------------------------------------

At this time, the risk settings covered by this proposal are set
forth in Rule 6.40 [sic] (Risk Limitation Mechanism).\9\ Pursuant to
Rule 928NY(b)-(d), Users may set certain risk control thresholds in the
Risk Limitation Mechanism, which are designed to mitigate the potential
risks of multiple executions against a User's trading interest that, in
today's highly automated and electronic trading environment, can occur
simultaneously across multiple series and multiple option classes. As
proposed, the Exchange may share a User's Risk Limitation Mechanism
settings with the Clearing Member that guarantees the User's
transactions on the Exchange, and therefore has a financial interest in
understanding the risk tolerance of the User.
---------------------------------------------------------------------------

\9\ The Exchange may adopt additional rules providing for User-
enabled risk settings that would be covered under this proposal. The
Exchange will announce via Trader Update any additional risk
settings (i.e., other than Rule 928NY(b)-(d)) that are adopted and
covered by proposed Rule 902.1NY.
---------------------------------------------------------------------------

Because the Clearing Letter of Consent codifies relationships
between each User and Clearing Member, the Exchange is on notice of
which Clearing Members have relationships with which Users. The
proposed rule change would simply provide the Exchange with authority
to directly provide Clearing Members with information that may
otherwise be available to such Clearing Members by virtue of their
relationship with the respective Users.
2. Statutory Basis
The statutory basis for the proposed rule change is Section 6(b)(5)
of the Securities Exchange Act of 1934 (the ``Act''), in general, and
furthers the objectives of Section 6(b)(5),\10\ which requires the
rules of an exchange 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.
---------------------------------------------------------------------------

\10\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

The Exchange believes that the proposed rule change removes
impediments to and perfects the mechanism of a free and open market by
codifying that the Exchange can directly furnish to Clearing Members
that guarantee that User's transactions on the Exchange the User-
designated risk settings in OX, including Risk Limitation Mechanism
settings, which are designed to mitigate the potential risks of
multiple executions against a User's trading interest that, in today's
highly automated and electronic trading environment, can occur
simultaneously across multiple series and multiple option classes. The
Exchange believes that the proposal is consistent with the protection
of investors and the public interests because it will permit Clearing
Members with a financial interest in a User's risk settings to better
monitor and manage the potential risks assumed by Users with whom the
Clearing Member has entered into a Clearing Letter of Consent, thereby
providing Clearing Members with greater control and flexibility over
setting their own risk tolerance and exposure.

B. Self-Regulatory Organization's Statement on Burden on Competition

The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The proposed rule change is
not designed to address any competitive issues, but would provide
authority for the Exchange to directly share risk settings with
Clearing Members regarding the Users with whom the Clearing Member has
executed a Clearing Letter of Consent so the Clearing Member can better
monitor and manage the potential risks assumed by these Users, thereby
providing them with greater control and flexibility over setting their
own risk tolerance and exposure. Nonetheless, the proposal does not
pose an undue burden on non-Clearing Members because, unlike Clearing
Members, non-Clearing Members do not guarantee the execution of the
User transactions on the Exchange. The proposal is structured to offer
the same enhancement to all Clearing Members, regardless of size, and
would not impose a competitive burden on any participant.

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

Within 45 days of the date of publication of this notice in the
Federal

[[Page 60555]]

Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve or disapprove the proposed rule change, or
(B) Institute proceedings to determine whether the proposed rule
change should be 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-NYSEMKT-2014-81 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-NYSEMKT-2014-81. 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 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-NYSEMKT-2014-81, and should
be submitted on or before October 28, 2014.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

\11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-23839 Filed 10-6-14; 8:45 am]
BILLING CODE 8011-01-P

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