Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Eliminate Rule 13.4, “Assigning of Registered Securities in the Name of a Member or Member Organization”, 11244-11246 [2015-04183]

Download as PDF 11244 Federal Register / Vol. 80, No. 40 / Monday, March 2, 2015 / Notices rule change. The text of these statements may be examined at the places specified in Item IV below. DTC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. as applicable, be cost-effective in meeting the requirements of participants while maintaining safe and secure operations. (A) Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change DTC does not believe that the proposed rule change would have any impact, or impose any burden, on competition. 1. Purpose The purpose of the proposed rule change is to discontinue PRS. PRS was implemented in 2003 and enables DTC Participants (‘‘Participants’’) and DTC-authorized third parties (Participants and such DTC-authorized third parties, collectively referred to as ‘‘Users’’) 4 to access prospectuses and official statements relating to new issues of corporate and municipal securities (‘‘Documents’’) available in electronic format from a DTC-maintained Web site.5 Due to the fact that PRS currently has few Users and many of the Documents made available via PRS are available to the public via electronic sources outside of DTC, it is no longer necessary or cost-effective for DTC or the industry to have DTC continue to maintain PRS. Therefore, DTC proposes to discontinue PRS and delete the Terms of Use from the Rules. Effective Date The effective date of the proposed rule change would be announced via a DTC Important Notice. asabaliauskas on DSK5VPTVN1PROD with NOTICES 2. Statutory Basis The proposed rule change would discontinue an underutilized service and eliminate the associated costs to DTC of maintaining it. Therefore, by precluding the need for DTC to allocate resources in this regard, the proposed rule change is consistent with the provisions of: (i) Section 17A(b)(3)(F) 6 of the Act which requires that the rules of the clearing agency be designed, inter alia, to promote the prompt and accurate clearance and settlement of securities transactions, and (ii) Rule 17Ad–22(d)(6) 7 promulgated under the Act which requires, inter alia, that a clearing agency establish, implement, maintain and enforce written policies and procedures reasonably designed to, 4 Third-party Users of PRS include syndicate members, correspondent banks, paying agents, transfer agents, and certain legal counsel and financial advisors. Individual investors do not have access to PRS. 5 Securities Exchange Act Release No. 47410 (February 26, 2003); 68 FR 10558 (March 5, 2003) (SR–DTC–2002–13). 6 15 U.S.C. 78q–1(b)(3)(F). 7 17 CFR 240.17Ad–22(d)(6). VerDate Sep<11>2014 16:55 Feb 27, 2015 Jkt 235001 (B) Clearing Agency’s Statement on Burden on Competition (C) Clearing Agency’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments relating to the proposed rule change have not yet been solicited or received. DTC will notify the Commission of any written comments received by DTC. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action 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 also will be available for inspection and copying at the principal office of DTC and on DTCC’s Web site (https://dtcc.com/legal/sec-rulefilings.aspx). 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–DTC– 2015–01 and should be submitted on or before March 23, 2015. Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate 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 such proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be disapproved. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 Jill M. Peterson, Assistant Secretary. IV. Solicitation of Comments [FR Doc. 2015–04184 Filed 2–27–15; 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: BILLING CODE 8011–01–P 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– DTC–2015–01 on the subject line. Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Eliminate Rule 13.4, ‘‘Assigning of Registered Securities in the Name of a Member or Member Organization’’ Paper Comments February 24, 2015. • 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–DTC–2015–01. 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 PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–74360; File No. SR–BYX– 2015–11] Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on February 12, 2015, BATS Y-Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BYX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule 8 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\02MRN1.SGM 02MRN1 Federal Register / Vol. 80, No. 40 / Monday, March 2, 2015 / Notices change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange has designated this proposal as a ‘‘noncontroversial’’ proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f)(6) thereunder,4 which renders it effective upon filing with 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 The Exchange filed a proposal to eliminate Rule 13.4, ‘‘Assigning of Registered Securities in the Name of a Member or Member Organization.’’ The text of the proposed rule change is available at the Exchange’s Web site at www.batstrading.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 Exchange 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. 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 eliminate Rule 13.4, ‘‘Assigning of Registered Securities in the Name of a Member or Member Organization,’’ which permits the Exchange to establish a signature guarantee program. In sum, a signature guarantee program allows an investor who seeks to transfer or sell securities held in physical certificate form to have their signature on the certificate ‘‘guaranteed.’’ Rule 13.4 permits Members to guarantee their signatures by authorizing one or more of their employees to assign registered securities in the Member’s name and to guarantee assignments of registered securities on behalf of the Member where the security 3 15 4 17 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). VerDate Sep<11>2014 16:55 Feb 27, 2015 Jkt 235001 had been signed by one of the partners of the Member or by one of the authorized officers of the Member by executing and filing with the Exchange a separate Power of Attorney, also known as a traditional signature card program. Transfer agents often insist that a signature be guaranteed before they accept the transaction because it limits their liability and losses if a signature turns out to be forged. Rule 17Ad–15 under the Act permits transfer agents to reject signature guarantees from eligible guarantor institutions that are not part of a signature guarantee program.5 The rule encouraged a movement away from the traditional signature card programs administered by the exchanges towards signature guarantee programs that use a medallion imprint or stamp which evidences their participation in the program and is an acceptable signature guarantee (‘‘Medallion Signature Guarantee Program’’).6 The Commission has also noted that: [a]n investor can obtain a signature guarantee from a financial institution—such as a commercial bank, savings bank, credit union, or broker dealer—that participates in one of the Medallion signature guarantee programs. . . . If a financial institution is not a member of a recognized Medallion Signature Guarantee Program, it would not be able to provide signature guarantees. Also, if [an investor is] not a customer of a participating financial institution, it is likely the financial institution will not guarantee [the investor’s] signature. Therefore, the best source of a Medallion Guarantee would be a bank, savings and loan association, brokerage firm, or credit union with which [the investor does] business.7 In response to Rule 17Ad–15, certain exchanges have decommissioned or amended their rules to no longer provide for traditional signature card program.8 While the Exchange adopted 5 See 17 CFR 240.17Ad–15; Securities Exchange Act Release No. 30146 (January 10, 1992), 57 FR 1082 (February 24, 1992) (adopting Rule 17Ad–15). 6 See, e.g., Securities Exchange Act Release No. 33669 (February 23, 1994), 59 FR 10189 (March 3, 1994) (SR–MSTC–93–13) (‘‘[t]his newly adopted Rule 17Ad–15 rule rendered [Midwest Securities Trust Company’s (‘‘MSTC’’)] Signature Distribution Program and Signature Guarantee Program obsolete. Therefore, to avoid costs that produce no benefits, MSTC eliminated its Signature Distribution and Signature Guarantee Programs and deleted MSTC Rule 5, Sections 1 and 2 which govern these programs’’). 7 See ‘‘Signature Guarantees: Preventing the Unauthorized Transfer of Securities,’’ https:// www.sec.gov/answers/sigguar.htm. 8 See Securities Exchange Act Release No. 34188 (June 9, 1994), 59 FR 30820 (June 15, 1994) (SR– MSTC–93–13) (order approving the elimination of MSTC’s signature guarantee program stating that Rule 17Ad–15 rendered it obsolete); Securities Exchange Act Release No. 32590 (July 7, 1993), 58 FR 37978 (July 14, 1993) (order approving SR– PHLX–92–39 eliminating the PHLX’s signature PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 11245 Rule 13.4 as part of its Form 1 exchange application,9 it has never offered, and does not now intend to offer, a signature guarantee service. The move towards Medallion Signature Guarantee Programs has also rendered traditional card programs as provided for under Exchange Rule 13.4 obsolete. Therefore, the Exchange proposes to eliminate Rule 13.4. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act 10 and furthers the objectives of Section 6(b)(5) of the Act,11 in that it is designed to 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, protect investors and the public interest by eliminating unnecessary confusion with respect to the Exchange’s rules. Rule 17Ad–15 encouraged a movement away from the traditional signature card programs administered by the exchanges towards certain Medallion Signature Guarantee Programs. In response, certain exchanges have decommissioned or amended their rules to no longer provide for a traditional signature card program.12 The Exchange has never guarantee program in light of Rule 17Ad–15) (noting that ‘‘[b]y eliminating its signature guarantee program, PHLX will streamline the signature guarantee process. In place of the cumbersome signature card system, PHLX will require participation in a Rule 17Ad–15 Signature Guarantee Program’’). In 2006, the Philadelphia Stock Exchange, Inc. (currently Nasdaq OMX PHLX LLC) (‘‘PHLX’’) eliminated Rules 327–340 regarding signature guarantees in their entirety from its rulebook, noting that they are ‘‘being deleted as obsolete because they refer to the delivery and settlement of securities, which is not done by the Exchange, but by registered clearing agencies.’’ Securities Exchange Act Release No. 54329 (August 17, 2006), 71 FR 504538 (August 25, 2006) (SR– PHLX–2006–43); Securities Exchange Act Release No. 54538 (September 28, 2006), 71 FR 59184 (October 6, 2006 (order approving SR–PHLX–2006– 43). 9 See Securities Exchange Act Release Nos. 58375 (August 18, 2008), 73 FR 49498 (August 21, 2008) (File No. 10–182) (In the Matter of the Application of the BATS Exchange, Inc. for Registration as a National Securities Exchange, Findings, Opinion, and Order of the Commission); 62716 (August 13, 2010), 75 FR 51295 (August 19, 2010) (File No. 10– 198) (In the Matter of the Application of the BATS Y-Exchange, Inc. for Registration as a National Securities Exchange, Findings, Opinion, and Order of the Commission). 10 15 U.S.C. 78f(b). 11 15 U.S.C. 78f(b)(5). 12 See Securities Exchange Act Release No. 34188 (June 9, 1994), 59 FR 30820 (June 15, 1994) (SR– MSTC–93–13) (order approving the elimination of MSTC’s signature guarantee program stating that Rule 17Ad–15 rendered it obsolete); Securities Exchange Act Release No. 32590 (July 7, 1993), 58 FR 37978 (July 14, 1993) (SR–PHLX–92–39) (order E:\FR\FM\02MRN1.SGM Continued 02MRN1 11246 Federal Register / Vol. 80, No. 40 / Monday, March 2, 2015 / Notices offered, and does not now intend to offer, a signature guarantee service. Also, the move towards Medallion Signature Guarantee Programs has rendered traditional card programs as provided for under Exchange Rule 13.4 obsolete. Therefore, the Exchange believes eliminating Rule 13.4 would clarify the Exchange’s rules by eliminating rules that account for services the Exchange does not provide. The Exchange also believes the elimination of unnecessary and obsolete rules removes impediments to the perfection of the mechanisms for a free and open market system consistent with the requirements of Section 6(b)(5) of the Act.13 (B) Self-Regulatory Organization’s Statement on Burden on Competition The proposed rule change does not impose any burden on competition. Rule 17Ad–15 encouraged a movement away from the traditional signature card programs administered by the exchanges towards certain Medallion Signature Guarantee Programs. In response, certain exchanges have decommissioned or amended their rules to no longer provide for a traditional signature card program.14 An investor may still obtain a signature guarantee from a financial institution that participates in one of the Medallion Signature Guarantee Programs. The Exchange has never offered, and does not intend to offer, a signature guarantee service. Also, the move towards Medallion Signature Guarantee Programs has rendered traditional card programs as provided for under Exchange Rule 13.4 obsolete. Therefore, the Exchange believes eliminating Rule 13.4 would not impose any burden on competition. (C) Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others asabaliauskas on DSK5VPTVN1PROD with NOTICES The Exchange has neither solicited nor received written comments on the proposed rule change. approving SR–PHLX–92–39 eliminating the PHLX’s signature guarantee program in light of Rule 17Ad– 15). 13 15 U.S.C. 78f(b)(5). 14 See Securities Exchange Act Release No. 34188 (June 9, 1994), 59 FR 30820 (June 15, 1994) (SR– MSTC–93–13) (order approving the elimination of MSTC’s signature guarantee program stating that Rule 17Ad–15 rendered it obsolete); Securities Exchange Act Release No. 32590 (July 7, 1993), 58 FR 37978 (July 14, 1993) (SR–PHLX–92–39) (order approving SR–PHLX–92–39 eliminating the PHLX’s signature guarantee program in light of Rule 17Ad– 15). VerDate Sep<11>2014 16:55 Feb 27, 2015 Jkt 235001 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing 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 for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 15 and paragraph of Rule 19b–4(f)(6) thereunder.16 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. IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rules 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 No. SR– BYX–2015–11 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 No. SR–BYX–2015–11. 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 also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File No. SR–BYX–2015– 11 and should be submitted on or before March 23, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.17 Jill M. Peterson, Assistant Secretary. [FR Doc. 2015–04183 Filed 2–27–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–74362; File No. SR–ICEEU– 2015–005] Self-Regulatory Organizations; ICE Clear Europe Limited; Notice of Filing of a Proposed Rule Change Relating to CDS Procedures for CDX North America Index CDS Contracts February 24, 2015. 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 February 12, 2015, ICE Clear Europe Limited (‘‘ICE Clear Europe’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared primarily by ICE Clear Europe. 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 principal purpose of the proposed rule change is to amend the ICE Clear Europe CDS Procedures (the ‘‘CDS Procedures’’) to incorporate contract terms for the CDX North America index CDS contracts (the 17 17 15 15 U.S.C. 78s(b)(3)(A). 16 17 CFR 240.19b–4(f)(6). PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\02MRN1.SGM 02MRN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 80, Number 40 (Monday, March 2, 2015)]
[Notices]
[Pages 11244-11246]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-04183]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74360; File No. SR-BYX-2015-11]


Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To 
Eliminate Rule 13.4, ``Assigning of Registered Securities in the Name 
of a Member or Member Organization''

February 24, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on February 12, 2015, BATS Y-Exchange, Inc. (the ``Exchange'' or 
``BYX'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule

[[Page 11245]]

change as described in Items I and II below, which Items have been 
prepared by the Exchange. The Exchange has designated this proposal as 
a ``non-controversial'' proposed rule change pursuant to Section 
19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(6) thereunder,\4\ which 
renders it effective upon filing with the Commission. 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\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to eliminate Rule 13.4, ``Assigning 
of Registered Securities in the Name of a Member or Member 
Organization.''
    The text of the proposed rule change is available at the Exchange's 
Web site at www.batstrading.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 Exchange 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. 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 eliminate Rule 13.4, ``Assigning of 
Registered Securities in the Name of a Member or Member Organization,'' 
which permits the Exchange to establish a signature guarantee program. 
In sum, a signature guarantee program allows an investor who seeks to 
transfer or sell securities held in physical certificate form to have 
their signature on the certificate ``guaranteed.'' Rule 13.4 permits 
Members to guarantee their signatures by authorizing one or more of 
their employees to assign registered securities in the Member's name 
and to guarantee assignments of registered securities on behalf of the 
Member where the security had been signed by one of the partners of the 
Member or by one of the authorized officers of the Member by executing 
and filing with the Exchange a separate Power of Attorney, also known 
as a traditional signature card program. Transfer agents often insist 
that a signature be guaranteed before they accept the transaction 
because it limits their liability and losses if a signature turns out 
to be forged.
    Rule 17Ad-15 under the Act permits transfer agents to reject 
signature guarantees from eligible guarantor institutions that are not 
part of a signature guarantee program.\5\ The rule encouraged a 
movement away from the traditional signature card programs administered 
by the exchanges towards signature guarantee programs that use a 
medallion imprint or stamp which evidences their participation in the 
program and is an acceptable signature guarantee (``Medallion Signature 
Guarantee Program'').\6\ The Commission has also noted that:
---------------------------------------------------------------------------

    \5\ See 17 CFR 240.17Ad-15; Securities Exchange Act Release No. 
30146 (January 10, 1992), 57 FR 1082 (February 24, 1992) (adopting 
Rule 17Ad-15).
    \6\ See, e.g., Securities Exchange Act Release No. 33669 
(February 23, 1994), 59 FR 10189 (March 3, 1994) (SR-MSTC-93-13) 
(``[t]his newly adopted Rule 17Ad-15 rule rendered [Midwest 
Securities Trust Company's (``MSTC'')] Signature Distribution 
Program and Signature Guarantee Program obsolete. Therefore, to 
avoid costs that produce no benefits, MSTC eliminated its Signature 
Distribution and Signature Guarantee Programs and deleted MSTC Rule 
5, Sections 1 and 2 which govern these programs'').

[a]n investor can obtain a signature guarantee from a financial 
institution--such as a commercial bank, savings bank, credit union, 
or broker dealer--that participates in one of the Medallion 
signature guarantee programs. . . . If a financial institution is 
not a member of a recognized Medallion Signature Guarantee Program, 
it would not be able to provide signature guarantees. Also, if [an 
investor is] not a customer of a participating financial 
institution, it is likely the financial institution will not 
guarantee [the investor's] signature. Therefore, the best source of 
a Medallion Guarantee would be a bank, savings and loan association, 
brokerage firm, or credit union with which [the investor does] 
business.\7\
---------------------------------------------------------------------------

    \7\ See ``Signature Guarantees: Preventing the Unauthorized 
Transfer of Securities,'' https://www.sec.gov/answers/sigguar.htm.

    In response to Rule 17Ad-15, certain exchanges have decommissioned 
or amended their rules to no longer provide for traditional signature 
card program.\8\ While the Exchange adopted Rule 13.4 as part of its 
Form 1 exchange application,\9\ it has never offered, and does not now 
intend to offer, a signature guarantee service. The move towards 
Medallion Signature Guarantee Programs has also rendered traditional 
card programs as provided for under Exchange Rule 13.4 obsolete. 
Therefore, the Exchange proposes to eliminate Rule 13.4.
---------------------------------------------------------------------------

    \8\ See Securities Exchange Act Release No. 34188 (June 9, 
1994), 59 FR 30820 (June 15, 1994) (SR-MSTC-93-13) (order approving 
the elimination of MSTC's signature guarantee program stating that 
Rule 17Ad-15 rendered it obsolete); Securities Exchange Act Release 
No. 32590 (July 7, 1993), 58 FR 37978 (July 14, 1993) (order 
approving SR-PHLX-92-39 eliminating the PHLX's signature guarantee 
program in light of Rule 17Ad-15) (noting that ``[b]y eliminating 
its signature guarantee program, PHLX will streamline the signature 
guarantee process. In place of the cumbersome signature card system, 
PHLX will require participation in a Rule 17Ad-15 Signature 
Guarantee Program''). In 2006, the Philadelphia Stock Exchange, Inc. 
(currently Nasdaq OMX PHLX LLC) (``PHLX'') eliminated Rules 327-340 
regarding signature guarantees in their entirety from its rulebook, 
noting that they are ``being deleted as obsolete because they refer 
to the delivery and settlement of securities, which is not done by 
the Exchange, but by registered clearing agencies.'' Securities 
Exchange Act Release No. 54329 (August 17, 2006), 71 FR 504538 
(August 25, 2006) (SR-PHLX-2006-43); Securities Exchange Act Release 
No. 54538 (September 28, 2006), 71 FR 59184 (October 6, 2006 (order 
approving SR-PHLX-2006-43).
    \9\ See Securities Exchange Act Release Nos. 58375 (August 18, 
2008), 73 FR 49498 (August 21, 2008) (File No. 10-182) (In the 
Matter of the Application of the BATS Exchange, Inc. for 
Registration as a National Securities Exchange, Findings, Opinion, 
and Order of the Commission); 62716 (August 13, 2010), 75 FR 51295 
(August 19, 2010) (File No. 10-198) (In the Matter of the 
Application of the BATS Y-Exchange, Inc. for Registration as a 
National Securities Exchange, Findings, Opinion, and Order of the 
Commission).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act \10\ and furthers the objectives of 
Section 6(b)(5) of the Act,\11\ in that it is designed to 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, protect investors and the public interest by 
eliminating unnecessary confusion with respect to the Exchange's rules. 
Rule 17Ad-15 encouraged a movement away from the traditional signature 
card programs administered by the exchanges towards certain Medallion 
Signature Guarantee Programs. In response, certain exchanges have 
decommissioned or amended their rules to no longer provide for a 
traditional signature card program.\12\ The Exchange has never

[[Page 11246]]

offered, and does not now intend to offer, a signature guarantee 
service. Also, the move towards Medallion Signature Guarantee Programs 
has rendered traditional card programs as provided for under Exchange 
Rule 13.4 obsolete. Therefore, the Exchange believes eliminating Rule 
13.4 would clarify the Exchange's rules by eliminating rules that 
account for services the Exchange does not provide. The Exchange also 
believes the elimination of unnecessary and obsolete rules removes 
impediments to the perfection of the mechanisms for a free and open 
market system consistent with the requirements of Section 6(b)(5) of 
the Act.\13\
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(5).
    \12\ See Securities Exchange Act Release No. 34188 (June 9, 
1994), 59 FR 30820 (June 15, 1994) (SR-MSTC-93-13) (order approving 
the elimination of MSTC's signature guarantee program stating that 
Rule 17Ad-15 rendered it obsolete); Securities Exchange Act Release 
No. 32590 (July 7, 1993), 58 FR 37978 (July 14, 1993) (SR-PHLX-92-
39) (order approving SR-PHLX-92-39 eliminating the PHLX's signature 
guarantee program in light of Rule 17Ad-15).
    \13\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

(B) Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change does not impose any burden on competition. 
Rule 17Ad-15 encouraged a movement away from the traditional signature 
card programs administered by the exchanges towards certain Medallion 
Signature Guarantee Programs. In response, certain exchanges have 
decommissioned or amended their rules to no longer provide for a 
traditional signature card program.\14\ An investor may still obtain a 
signature guarantee from a financial institution that participates in 
one of the Medallion Signature Guarantee Programs. The Exchange has 
never offered, and does not intend to offer, a signature guarantee 
service. Also, the move towards Medallion Signature Guarantee Programs 
has rendered traditional card programs as provided for under Exchange 
Rule 13.4 obsolete. Therefore, the Exchange believes eliminating Rule 
13.4 would not impose any burden on competition.
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    \14\ See Securities Exchange Act Release No. 34188 (June 9, 
1994), 59 FR 30820 (June 15, 1994) (SR-MSTC-93-13) (order approving 
the elimination of MSTC's signature guarantee program stating that 
Rule 17Ad-15 rendered it obsolete); Securities Exchange Act Release 
No. 32590 (July 7, 1993), 58 FR 37978 (July 14, 1993) (SR-PHLX-92-
39) (order approving SR-PHLX-92-39 eliminating the PHLX's signature 
guarantee program in light of Rule 17Ad-15).
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(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants or Others

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing 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 for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \15\ and paragraph 
of Rule 19b-4(f)(6) thereunder.\16\
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    \15\ 15 U.S.C. 78s(b)(3)(A).
    \16\ 17 CFR 240.19b-4(f)(6).
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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.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed 
rules 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 No. SR-BYX-2015-11 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 No. SR-BYX-2015-11. 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 also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File No. SR-BYX-2015-11 and should be 
submitted on or before March 23, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\17\
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    \17\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2015-04183 Filed 2-27-15; 8:45 am]
BILLING CODE 8011-01-P

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