Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Extending Its Program That Allows Transactions To Take Place at a Price That Is Below $1 Per Option Contract Until January 5, 2016, 1065-1067 [2015-00050]
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Federal Register / Vol. 80, No. 5 / Thursday, January 8, 2015 / Notices
respect to all transactions under the
Master Repurchase Agreement.
II. Discussion and Commission
Findings
Although Title VIII does not specify a
standard of review for an advance
notice, the Commission believes that the
stated purpose of Title VIII is
instructive.17 The stated purpose of
Title VIII is to mitigate systemic risk in
the financial system and promote
financial stability by, among other
things, promoting uniform risk
management standards for systemicallyimportant financial market utilities
(‘‘FMUs’’) and strengthening the
liquidity of systemically important
FMUs.18
Section 805(a)(2) of the Clearing
Supervision Act 19 authorizes the
Commission to prescribe risk
management standards for the payment,
clearing, and settlement activities of
designated clearing entities and
financial institutions engaged in
designated activities for which it is the
supervisory agency or the appropriate
financial regulator. Section 805(b) of the
Clearing Supervision Act 20 states that
the objectives and principles for the risk
management standards prescribed under
Section 805(a) shall be to:
• Promote robust risk management;
• promote safety and soundness;
• reduce systemic risks; and
• support the stability of the broader
financial system.
The Commission has adopted risk
management standards under Section
805(a)(2) of the Clearing Supervision
Act (‘‘Clearing Agency Standards’’).21
The Clearing Agency Standards became
effective on January 2, 2013, and require
registered clearing agencies that perform
central counterparty (‘‘CCP’’) services to
establish, implement, maintain, and
enforce written policies and procedures
that are reasonably designed to meet
certain minimum requirements for their
operations and risk management
practices on an ongoing basis.22 As
such, it is appropriate for the
Commission to review advance notices
against these Clearing Agency
Standards, and the objectives and
principles of these risk management
standards as described in Section 805(b)
of the Clearing Supervision Act.23
The Commission believes that the
proposal in this Advance Notice is
designed to further the objectives and
principles of Section 805(b) of the
Clearing Supervision Act.24 As a
systemically-important FMU, it is
imperative that OCC have adequate
resources to be able to satisfy its
counterparty settlement obligations. The
MRA Program provides OCC with a
committed liquidity resource that does
not increase the concentration of OCC’s
counterparty exposure because the
counterparties will not include OCC’s
clearing members nor affiliated
commercial banking institutions.
Accordingly, the Commission believes
that the proposal should promote robust
risk management, promote safety and
soundness in the marketplace, reduce
systemic risks, and support the stability
of the broader financial system by giving
OCC access to additional committed
liquidity that will help OCC meet its
settlement obligations in a timely
manner, while also limiting the
exposure that OCC has to its
counterparties.
Exchange Act Rule 17Ad–22(b)(3),25
adopted as part of the Clearing Agency
Standards, requires that a non-securitybased swap registered clearing agency
that performs CCP services establish,
implement, maintain, and enforce
written policies and procedures
reasonably designed to withstand, at a
minimum, a default by the participant
family to which it has the largest
exposure in extreme but plausible
market conditions. As a part of OCC’s
overall liquidity plan, the Commission
believes that the MRA Program will
contribute additional liquid financial
resources that should enhance OCC’s
ability to meet any potential settlement
demands arising out of a default of a
clearing member or clearing member
family, including one to which it has
the largest exposure.
III. Conclusion
17 See
12 U.S.C. 5461(b).
18 Id.
tkelley on DSK3SPTVN1PROD with NOTICES
19 12
U.S.C. 5464(a)(2).
20 12 U.S.C. 5464(b).
21 17 CFR 240.17Ad–22.
22 The Clearing Agency Standards are
substantially similar to the risk management
standards established by the Board of Governors of
the Federal Reserve System governing the
operations of designated FMUs that are not clearing
entities and financial institutions engaged in
designated activities for which the Commission or
the Commodity Futures Trading Commission is the
Supervisory Agency. See Financial Market Utilities,
77 FR 45907 (August 2, 2012).
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It is therefore noticed, pursuant to
Section 806(e)(1)(I) of the Clearing
Supervision Act,26 that the Commission
does not object to advance notice
proposal (SR–OCC–2014–809) and that
OCC is authorized to implement the
proposal as of the date of this notice.
U.S.C. 5464(b).
U.S.C 5464(b).
25 17 CFR 240.17Ad–22(b)(3).
26 12 U.S.C. 5465(e)(1)(I).
By the Commission.
Brent J. Fields,
Secretary.
[FR Doc. 2015–00052 Filed 1–7–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73977; File No. SR–
NYSEARCA–2014–152]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Extending Its Program
That Allows Transactions To Take
Place at a Price That Is Below $1 Per
Option Contract Until January 5, 2016
January 2, 2015.
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 December
30, 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to extend its
program that allows transactions to take
place at a price that is below $1 per
option contract until January 5, 2016.
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,
23 12
24 12
PO 00000
Frm 00052
Fmt 4703
Sfmt 4703
1065
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
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1066
Federal Register / Vol. 80, No. 5 / Thursday, January 8, 2015 / Notices
of the most significant parts of such
statements.
tkelley on DSK3SPTVN1PROD with NOTICES
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The purpose of this filing is to extend
the Pilot Program 4 under Rule 6.80 to
allow accommodation transactions
(‘‘Cabinet Trades’’) to take place at a
price that is below $1 per option
contract for one additional year. The
Exchange proposes to extend the
program, which is due to expire on
January 5, 2015 until January 5, 2016.
An ‘‘accommodation’’ or ‘‘cabinet’’
trade refers to trades in listed options on
the Exchange that are worthless or not
actively traded. Cabinet trading is
generally conducted in accordance with
the Exchange Rules, except as provided
in Exchange Rule 6.80 Accommodation
Transactions (Cabinet Trades), which
sets forth specific procedures for
engaging in cabinet trades. Rule 6.80
currently provides for cabinet
transactions to occur via open outcry at
a cabinet price of a $1 per option
contract in any options series open for
trading in the Exchange, except that the
Rule is not applicable to trading in
option classes participating in the
Penny Pilot Program. Under the
procedures, bids and offers (whether
opening or closing a position) at a price
of $1 per option contract may be
represented in the trading crowd by a
Floor Broker or by a Market Maker or
provided in response to a request by a
Trading Official, a Floor Broker or a
Market Maker, but must yield priority to
all resting orders in the Cabinet (those
orders held by the Trading Official, and
which resting cabinet orders may be
closing only). So long as both the buyer
and the seller yield to orders resting in
the cabinet book, opening cabinet bids
can trade with opening cabinet offers at
$1 per option contract.
The Exchange has temporarily
amended the procedures through
January 5, 2015 to allow transactions to
take place in open outcry at a price of
at least $0 but less than $1 per option
contract. These lower-priced
transactions are permitted to be traded
pursuant to the same procedures
applicable to $1 cabinet trades, except
that (i) bids and offers for opening
transactions are only permitted to
accommodate closing transactions in
order to limit use of the procedure to
liquidations of existing positions, and
4 See
Securities Exchange Act Release No. 63476
(December 8, 2010), 75 FR 77930 (December 14,
2010) (SR–NYSE Arca–2010–109).
VerDate Sep<11>2014
17:07 Jan 07, 2015
Jkt 235001
(ii) the procedures are also made
available for trading in option classes
participating in the Penny Pilot
Program.5 The Exchange believes that
allowing a price of at least $0 but less
than $1 better accommodates the closing
of options positions in series that are
worthless or not actively traded,
particularly in the event where there has
been a significant movement in the
price of the underlying security that
results in a large number of series being
out-of-the-money. For example, a
market participant might have a long
position in a put series with a strike
price of $30 and the underlying stock
might be trading at $100. In such an
instance, there might not otherwise be a
market for that person to close-out the
position even at the $1 cabinet price
(e.g., the series might be quoted no bid).
As with other accommodation
liquidations under Rule 6.80,
transactions that occur for less than $1
will not be disseminated to the public
on the consolidated tape. In addition, as
with other accommodation liquidations
under Rule 6.80, the transactions will be
exempt from the Consolidated Options
Audit Trail (‘‘COATS’’) requirements of
Exchange Rule 6.67 Order Format and
System Entry Requirements. However,
the Exchange will maintain quotation,
order and transaction information for
the transactions in the same format as
the COATS data is maintained. In this
regard, all transactions for less than $1
must be reported to the Exchange
following the close of each business
day.
2. Statutory Basis
The Exchange believes that this
proposed rule change is consistent with
Section 6(b) of the Securities Exchange
Act of 1934 (‘‘Act’’),6 in general, and
furthers the objectives of Section 6(b)(5)
of the Act 7 in particular, in that it is
designed to prevent fraudulent and
manipulative acts and practices,
promote just and equitable principles of
trade, remove impediments to and
perfect the mechanism of a free and
open market and a national market
system, and, in general, to protect
5 Currently the $1 cabinet trading procedures are
limited to options classes traded in $0.05 or $0.10
standard increment. The $1 cabinet trading
procedures are not available in Penny Pilot Program
classes because in those classes an option series can
trade in a standard increment as low as $0.01 per
share (or $1.00 per option contract with a 100 share
multiplier). Because the temporary procedures
allow trading below $0.01 per share (or $1.00 per
option contract with a 100 share multiplier), the
procedures are available for all classes, including
those classes participating in the Penny Pilot
Program.
6 15 U.S.C. 78f(b).
7 15 U.S.C. 78f(b)(5).
PO 00000
Frm 00053
Fmt 4703
Sfmt 4703
investors and the public interest. The
Exchange believes that allowing for
liquidations at a price less than $1 per
option contract will better facilitate the
closing of options positions that are
worthless or not actively trading,
especially in Penny Pilot issues where
Cabinet Trades are not otherwise
permitted.
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.
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
Because the foregoing rule does not (i)
significantly affect the protection of
investors or the public interest; (ii)
impose any significant burden on
competition; and (iii) become operative
for 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, provided that the selfregulatory organization has given the
Commission written notice of its intent
to file 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,8 the proposed rule change
has become effective pursuant to
Section 19(b)(3)(A) of the Act 9 and Rule
19b–4(f)(6) thereunder.10
Under Rule 19b–4(f)(6) of the Act,11
the proposal does not become operative
for 30 days after the date of its filing, or
such shorter time as the Commission
may designate if consistent with the
protection of investors and the public
interest. The Exchange has requested
that the Commission waive the 30-day
operative delay period after which a
proposed rule change under Rule 19b–
4(f)(6) becomes operative so that the
pilot may continue without
interruption. The Commission believes
that waiver of the 30-day operative
delay is consistent with the protection
8 The
Exchange has satisfied this requirement.
U.S.C. 78s(b)(3)(A).
10 17 CFR 240.19b–4(f)(6).
11 Id.
9 15
E:\FR\FM\08JAN1.SGM
08JAN1
Federal Register / Vol. 80, No. 5 / Thursday, January 8, 2015 / Notices
of investors and the public interest
because it will allow the pilot to
continue uninterrupted, thereby
avoiding any potential investor
confusion that could result from a
temporary interruption in the pilot and
allowing members to continue to benefit
from the program. Based on the
foregoing, the Commission hereby
waives the 30-day operative delay and
designates the proposal operative upon
filing.12
At any time within 60 days of the
filing of the 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 will institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
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 the
filing will also be available for
inspection and copying at the NYSE’s
principal office and on its Internet Web
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–2014–152 and should be
submitted on or before January 29, 2015.
IV. Solicitation of Comments
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Brent J. Fields,
Secretary.
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:
[FR Doc. 2015–00050 Filed 1–7–15; 8:45 am]
on or about February 12, 2015, until on
or about May 10, 2015, and at possible
additional exhibitions or venues yet to
be determined, is in the national
interest. I have ordered that Public
Notice of these Determinations be
published in the Federal Register.
FOR FURTHER INFORMATION CONTACT: For
further information, including lists of
the exhibit objects, contact Paul W.
Manning, Attorney-Adviser, Office of
the Legal Adviser, U.S. Department of
State (telephone: 202–632–6469). The
mailing address is U.S. Department of
State, SA–5, L/PD, Fifth Floor (Suite
5H03), Washington, DC 20522–0505.
Dated: January 5, 2015.
Kelly Keiderling,
Principal Deputy Assistant Secretary, Bureau
of Educational and Cultural Affairs,
Department of State.
[FR Doc. 2015–00105 Filed 1–7–15; 8:45 am]
BILLING CODE 4710–05–P
DEPARTMENT OF TRANSPORTATION
Federal Aviation Administration
[Summary Notice No. 2014–148]
Petition for Exemption; Summary of
Petition Received; Brandau, Jerry
BILLING CODE 8011–01–P
Electronic Comments
DEPARTMENT OF STATE
Federal Aviation
Administration (FAA), DOT.
ACTION: Notice.
• 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–2014–152 on the subject
line.
[Public Notice 8997]
SUMMARY:
Paper Comments
tkelley on DSK3SPTVN1PROD with NOTICES
1067
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEARCA–2014–152.
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
12 For purposes only of waiving the operative
delay, the Commission has considered the proposed
rule’s impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
VerDate Sep<11>2014
17:07 Jan 07, 2015
Jkt 235001
AGENCY:
Culturally Significant Objects Imported
for Exhibition Determinations: ‘‘Ink and
Gold: Art of the Kano’’ Exhibition
Notice is hereby given of the
following determinations: Pursuant to
the authority vested in me by the Act of
October 19, 1965 (79 Stat. 985; 22 U.S.C.
2459), Executive Order 12047 of March
27, 1978, the Foreign Affairs Reform and
Restructuring Act of 1998 (112 Stat.
2681, et seq.; 22 U.S.C. 6501 note, et
seq.), Delegation of Authority No. 234 of
October 1, 1999, Delegation of Authority
No. 236–3 of August 28, 2000 (and, as
appropriate, Delegation of Authority No.
257 of April 15, 2003), I hereby
determine that the objects to be
included in the exhibition ‘‘Ink and
Gold: Art of the Kano,’’ imported from
abroad for temporary exhibition within
the United States, are of cultural
significance. The objects are imported
pursuant to loan agreements with the
foreign owners or custodians. I also
determine that the exhibition or display
of the exhibit objects at the Philadelphia
Museum of Art, Philadelphia, PA, from
SUMMARY:
13 17
PO 00000
CFR 200.30–3(a)(12).
Frm 00054
Fmt 4703
Sfmt 4703
This notice contains a
summary of a petition seeking relief
from specified requirements of Title 14
of the Code of Federal Regulations. The
purpose of this notice is to improve the
public’s awareness of, and participation
in, the FAA’s exemption process.
Neither publication of this notice nor
the inclusion or omission of information
in the summary is intended to affect the
legal status of the petition or its final
disposition.
DATES: Comments on this petition must
identify the petition docket number and
must be received on or before January
28, 2015.
ADDRESSES: Send comments identified
by docket number FAA–2014–1016
using any of the following methods:
• Federal eRulemaking Portal: Go to
https://www.regulations.gov and follow
the online instructions for sending your
comments electronically.
• Mail: Send comments to Docket
Operations, M–30; U.S. Department of
Transportation (DOT), 1200 New Jersey
Avenue SE., Room W12–140, West
Building Ground Floor, Washington, DC
20590–0001.
• Hand Delivery or Courier: Take
comments to Docket Operations in
E:\FR\FM\08JAN1.SGM
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]]>Agencies
[Federal Register Volume 80, Number 5 (Thursday, January 8, 2015)]
[Notices]
[Pages 1065-1067]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-00050]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73977; File No. SR-NYSEARCA-2014-152]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Extending Its
Program That Allows Transactions To Take Place at a Price That Is Below
$1 Per Option Contract Until January 5, 2016
January 2, 2015.
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 December 30, 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 extend its program that allows
transactions to take place at a price that is below $1 per option
contract until January 5, 2016. 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,
[[Page 1066]]
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 purpose of this filing is to extend the Pilot Program \4\ under
Rule 6.80 to allow accommodation transactions (``Cabinet Trades'') to
take place at a price that is below $1 per option contract for one
additional year. The Exchange proposes to extend the program, which is
due to expire on January 5, 2015 until January 5, 2016.
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release No. 63476 (December 8,
2010), 75 FR 77930 (December 14, 2010) (SR-NYSE Arca-2010-109).
---------------------------------------------------------------------------
An ``accommodation'' or ``cabinet'' trade refers to trades in
listed options on the Exchange that are worthless or not actively
traded. Cabinet trading is generally conducted in accordance with the
Exchange Rules, except as provided in Exchange Rule 6.80 Accommodation
Transactions (Cabinet Trades), which sets forth specific procedures for
engaging in cabinet trades. Rule 6.80 currently provides for cabinet
transactions to occur via open outcry at a cabinet price of a $1 per
option contract in any options series open for trading in the Exchange,
except that the Rule is not applicable to trading in option classes
participating in the Penny Pilot Program. Under the procedures, bids
and offers (whether opening or closing a position) at a price of $1 per
option contract may be represented in the trading crowd by a Floor
Broker or by a Market Maker or provided in response to a request by a
Trading Official, a Floor Broker or a Market Maker, but must yield
priority to all resting orders in the Cabinet (those orders held by the
Trading Official, and which resting cabinet orders may be closing
only). So long as both the buyer and the seller yield to orders resting
in the cabinet book, opening cabinet bids can trade with opening
cabinet offers at $1 per option contract.
The Exchange has temporarily amended the procedures through January
5, 2015 to allow transactions to take place in open outcry at a price
of at least $0 but less than $1 per option contract. These lower-priced
transactions are permitted to be traded pursuant to the same procedures
applicable to $1 cabinet trades, except that (i) bids and offers for
opening transactions are only permitted to accommodate closing
transactions in order to limit use of the procedure to liquidations of
existing positions, and (ii) the procedures are also made available for
trading in option classes participating in the Penny Pilot Program.\5\
The Exchange believes that allowing a price of at least $0 but less
than $1 better accommodates the closing of options positions in series
that are worthless or not actively traded, particularly in the event
where there has been a significant movement in the price of the
underlying security that results in a large number of series being out-
of-the-money. For example, a market participant might have a long
position in a put series with a strike price of $30 and the underlying
stock might be trading at $100. In such an instance, there might not
otherwise be a market for that person to close-out the position even at
the $1 cabinet price (e.g., the series might be quoted no bid).
---------------------------------------------------------------------------
\5\ Currently the $1 cabinet trading procedures are limited to
options classes traded in $0.05 or $0.10 standard increment. The $1
cabinet trading procedures are not available in Penny Pilot Program
classes because in those classes an option series can trade in a
standard increment as low as $0.01 per share (or $1.00 per option
contract with a 100 share multiplier). Because the temporary
procedures allow trading below $0.01 per share (or $1.00 per option
contract with a 100 share multiplier), the procedures are available
for all classes, including those classes participating in the Penny
Pilot Program.
---------------------------------------------------------------------------
As with other accommodation liquidations under Rule 6.80,
transactions that occur for less than $1 will not be disseminated to
the public on the consolidated tape. In addition, as with other
accommodation liquidations under Rule 6.80, the transactions will be
exempt from the Consolidated Options Audit Trail (``COATS'')
requirements of Exchange Rule 6.67 Order Format and System Entry
Requirements. However, the Exchange will maintain quotation, order and
transaction information for the transactions in the same format as the
COATS data is maintained. In this regard, all transactions for less
than $1 must be reported to the Exchange following the close of each
business day.
2. Statutory Basis
The Exchange believes that this proposed rule change is consistent
with Section 6(b) of the Securities Exchange Act of 1934 (``Act''),\6\
in general, and furthers the objectives of Section 6(b)(5) of the Act
\7\ in particular, in that it is designed to prevent fraudulent and
manipulative acts and practices, promote just and equitable principles
of trade, 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 allowing
for liquidations at a price less than $1 per option contract will
better facilitate the closing of options positions that are worthless
or not actively trading, especially in Penny Pilot issues where Cabinet
Trades are not otherwise permitted.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(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 will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
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
Because the foregoing rule does not (i) significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative for 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, provided that the self-regulatory organization
has given the Commission written notice of its intent to file 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,\8\ the proposed rule change has become effective
pursuant to Section 19(b)(3)(A) of the Act \9\ and Rule 19b-4(f)(6)
thereunder.\10\
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\8\ The Exchange has satisfied this requirement.
\9\ 15 U.S.C. 78s(b)(3)(A).
\10\ 17 CFR 240.19b-4(f)(6).
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Under Rule 19b-4(f)(6) of the Act,\11\ the proposal does not become
operative for 30 days after the date of its filing, or such shorter
time as the Commission may designate if consistent with the protection
of investors and the public interest. The Exchange has requested that
the Commission waive the 30-day operative delay period after which a
proposed rule change under Rule 19b-4(f)(6) becomes operative so that
the pilot may continue without interruption. The Commission believes
that waiver of the 30-day operative delay is consistent with the
protection
[[Page 1067]]
of investors and the public interest because it will allow the pilot to
continue uninterrupted, thereby avoiding any potential investor
confusion that could result from a temporary interruption in the pilot
and allowing members to continue to benefit from the program. Based on
the foregoing, the Commission hereby waives the 30-day operative delay
and designates the proposal operative upon filing.\12\
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\11\ Id.
\12\ For purposes only of waiving the operative delay, the
Commission has considered the proposed rule's impact on efficiency,
competition, and capital formation. See 15 U.S.C. 78c(f).
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At any time within 60 days of the filing of the 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 will institute proceedings 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-2014-152 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEARCA-2014-152. 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 the filing will also be available
for inspection and copying at the NYSE's principal office and on its
Internet Web 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-2014-152 and should be submitted on or before
January 29, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-00050 Filed 1-7-15; 8:45 am]
BILLING CODE 8011-01-P
