Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to the Solicitation Auction Mechanism, 32997-33001 [2015-14133]
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Federal Register / Vol. 80, No. 111 / Wednesday, June 10, 2015 / Notices
the Exchange offering a service similar
to those offered by the CHX and
NYSE.16 Thus, the Exchange believes
this proposed rule change is necessary
to permit fair competition among
national securities exchanges. In
addition, the proposed rule change is
designed to provide Members with an
alternative means to access other market
centers if they chose or in the event of
a market disruption where other
alternative connection methods become
unavailable. Therefore, the Exchange
does not believe the proposed rule
change will have any effect on
competition.
(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.
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III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the proposed rule change
does not (i) significantly affect the
protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, the
proposed rule change has become
effective pursuant to section 19(b)(3)(A)
of the Act and Rule 19b–4(f)(6)
thereunder.17
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act normally does not become operative
for 30 days after the date of its filing.
However, Rule 19b–4(f)(6)(iii) permits
the Commission to designate a shorter
time if such action is consistent with the
protection of investors and the public
interest. The Exchange has asked the
Commission to waive the 30-day
operative delay so that the proposal may
become operative immediately upon
filing. Waiver of the 30-day operative
delay would permit the Exchange to
provide Members with an alternative
means to access other market centers,
particularly in the event of a market
disruption. In addition, the Exchange
16 See NYSE’s SFTI Americas Product and Service
List available at https://www.nyxdata.com/docs/
connectivity. See supra note 15.
17 In addition, Rule 19b–4(f)(6)(iii) requires the
Exchange to give the Commission written notice of
the Exchange’s intent to file the proposed rule
change, along with a brief description and text of
the proposed rule change, at least five business days
prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
Commission. The Exchange has satisfied this
requirement.
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represents that BATS Connect does not
provide any advantage to subscribers for
connecting to the Exchange’s affiliates
as compared to other methods of
connectivity available to subscribers.18
Based on the foregoing, the Commission
believes the waiver of the operative
delay is consistent with the protection
of investors and the public interest.19
The Commission hereby grants the
waiver and designates the proposal
operative upon filing.
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 shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
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 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–BYX–
2015–26 and should be submitted on or
before July 1, 2015.
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:
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.20
Robert W. Errett,
Deputy Secretary.
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–
BYX–2015–26 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–BYX–2015–26. 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
18 See
supra note 8.
purposes only of waiving the 30-day
operative delay, the Commission has also
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
[FR Doc. 2015–14135 Filed 6–9–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–75106; File No. SR–C2–
2015–014]
Self-Regulatory Organizations; C2
Options Exchange, Incorporated;
Notice of Filing and Immediate
Effectiveness of a Proposed Rule
Change Relating to the Solicitation
Auction Mechanism
June 4, 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 May 27,
2015, C2 Options Exchange,
Incorporated (the ‘‘Exchange’’ or ‘‘C2’’)
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 Exchange. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
19 For
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20 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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Federal Register / Vol. 80, No. 111 / Wednesday, June 10, 2015 / Notices
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
Rules 6.52 relating to the Solicitation
Auction Mechanism (‘‘SAM’’). The text
of the proposed rule change is provided
below. (additions are italicized;
deletions are [bracketed])
*
*
*
*
*
C2 Options Exchange, Incorporated
Rules
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*
*
*
*
*
Rule 6.52. Solicitation Auction
Mechanism
A Participant that represents agency
orders may electronically execute orders
it represents as agent (‘‘Agency Order’’)
against solicited orders provided it
submits the Agency Order for electronic
execution into the solicitation auction
mechanism (the ‘‘Auction’’) pursuant to
this Rule.
(a) Auction Eligibility Requirements.
A Participant (the ‘‘Initiating
Participant’’) may initiate an Auction
provided all of the following are met:
(1) The Agency Order is in a class
designated as eligible for Auctions as
determined by the Exchange and within
the designated Auction order eligibility
size parameters as such size parameters
are determined by the Exchange
(however, the eligible order size may
not be less than 500 standard option
contracts or 5,000 mini-option
contracts);
(2) Each order entered into the
Auction shall be designated as all-ornone and must be stopped with a
solicited order priced at or within the
NBBO as of the time of the initiation of
the Auction (i.e. the time that the
Agency Order is received in the System
(the ‘‘initial auction NBBO’’); and
(3) The minimum price increment for
an Initiating Participant’s single price
submission shall be determined by the
Exchange on a series basis and may not
be smaller than one cent.
(b) Auction Process. The Auction
shall proceed as follows:
(1) Auction Period and Requests for
Responses.
(A) To initiate the Auction, the
Initiating Participant must mark the
Agency Order for Auction processing,
and specify a single price at which it
seeks to cross the Agency Order with a
solicited order priced at or within the
initial auction NBBO.
(B) When the Exchange receives a
properly designated Agency Order for
Auction processing, a Request for
Responses message indicating the price,
side, and size at which it seeks to cross
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the Agency Order with a solicited order
will be sent to all Participants that have
elected to receive such messages.
(C)–(G) No change.
(2) Auction Conclusion and Order
Allocation. The Auction shall conclude
at the sooner of subparagraphs (b)(2)(A)
through (E) of Rule 6.51. At the
conclusion of the Auction, the Agency
Order will be automatically executed in
full or cancelled and allocated subject to
the following:
(A) The Agency Order will be
executed against the solicited order at
the proposed execution price, provided
that:
(i) The execution price must be equal
to or better than the initial auction
NBBO. If the execution would take
place outside the initial auction NBBO,
the Agency Order and solicited order
will be cancelled;
(ii)–(iii) No change.
. . . Interpretations and Policies:
.01–.03 No change.
*
*
*
*
*
The text of the proposed rule change
is also available on the Exchange’s Web
site (https://www.cboe.com/AboutCBOE/
CBOELegalRegulatoryHome.aspx), at
the Exchange’s Office of the Secretary,
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 aspects 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 make
changes to its existing SAM auction
rules in Rule 6.52. The Exchange
believes that the proposed amendments
would ensure greater consistency
between the Exchange’s SAM auction
and order protection rules 3 and provide
3 See Section E of C2 Rules Chapter 6 relating to
Intermarket Linkage (‘‘Intermarket Linkage Rule’’)
(providing that the rules contained in Section E of
CBOE Chapter IV relating to the Options Order
Protection and Locked/Crossed Market Plan shall
apply to C2).
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additional clarity in the Rules regarding
the Exchange’s SAM Auction
procedures.
Rule 6.52 permits Participants to
electronically execute all-or-none
(‘‘AON’’) orders for 500 or more
standard options contracts or 5,000 or
more mini-options contracts that they
represent as agent (‘‘Agency Order’’)
against solicited orders provided the
Participant submits the Agency Order
for electronic execution into SAM for
auction (the ‘‘Auction’’) pursuant to
Rule 6.52.4 Under Rules 6.52(a)(2) and
(b)(1)(A), each order entered into SAM
shall be designated AON by the
Initiating Participant with the Agency
Order marked for auction processing
with a specific single price at which the
Initiating Participant seeks to cross the
Agency Order with the solicited order.
Pursuant to Rule 6.52(b)(2)(A)(i), the
Agency Order will be executed against
the solicited order at the proposed
execution price, provided that, among
other things, the execution price must
be equal to or better than the C2 best bid
or offer (‘‘BBO’’). If the execution would
take place outside the BBO, the Agency
Order and solicited order will be
cancelled.5
Although Participants are subject to
the Exchange’s order protection rules
and thus, prevented from trading
through the displayed national best bid
and offer (‘‘NBBO’’), including within
the context of SAM auctions,6 current
Rule 6.52 does not specifically require
Initiating Participants to stop Agency
Orders at or within the NBBO or
expressly prohibit Agency Orders from
being executed against solicited orders
at prices outside the NBBO.7 In
addition, current Rule 6.52 does not
specify whether the Agency Order may
be executed against a solicited order
priced at or within the BBO as of the
time that the Agency Order is received
in the System,8 as of the time of the
beginning of the auction (i.e. the time
when requests for responses (‘‘RFRs’’)
4 SAM functionality is currently inactive on the
Exchange.
5 See Rule 6.52(b)(2)(A)(i).
6 See section E of C2 Rules Chapter 6 relating to
Intermarket Linkage (‘‘Intermarket Linkage Rule’’)
(providing that the rules contained in section E of
CBOE Chapter IV relating to the Options Order
Protection and Locked/Crossed Market Plan shall
apply to C2).
7 Notably, the Exchange’s other auction rules
expressly provide that Initiating Participants must
stop Agency Orders at or within the NBBO and
prohibit Agency Orders from being executed against
solicited orders at prices outside the NBBO. See
Rule 6.51(b) (Automated Improvement Mechanism
(‘‘AIM’’)).
8 See Rule 1.1 (System) (defining the term
‘‘System’’ to mean ‘‘the automated trading system
used by the Exchange for the trading of options
contracts’’).
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Federal Register / Vol. 80, No. 111 / Wednesday, June 10, 2015 / Notices
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are sent), or as of the time of execution.9
Accordingly, the Exchange is proposing
to make several clarifying amendments
to Rule 6.52 to require that Agency
Orders be stopped and executed at or
within the NBBO and to define when
the NBBO will be looked at for purposes
of order protection during the SAM
auction process.10
Specifically, the Exchange is
proposing to amend Rules 6.52(a)(2),
6.52(b)(1)(A), and 6.52(b)(2)(A)(i) to
provide that Agency Orders submitted
into SAM must be stopped with a
solicited order priced at or within the
national best bid or offer (‘‘NBBO’’) as
of the time of the initiation of the
Auction (i.e. the time that the Agency
Order is received for SAM auction
processing in the System) (the ‘‘initial
auction NBBO’’) and that Agency Orders
that are submitted for electronic
execution into SAM must be executed at
a price at or better than the initial
auction NBBO.11 Agency Orders paired
against solicited orders priced outside of
the NBBO that are submitted for
electronic execution into SAM would be
rejected by the System and cancelled by
the Exchange.
The Exchange believes that requiring
SAM orders to be stopped and executed
at a price equal to, or better than, the
NBBO as of the time of receipt of the
Agency Order in the OHS is consistent
with the Exchange’s Intermarket
Linkage Rule. As proposed, the range of
permissible crossing prices and
executions would be defined based on
a snapshot of the market at the time
when the Agency Order is received.12
This proposed rule change would thus,
make clear that although the NBBO may
update during the SAM auction
response time (currently SAM auctions
last one second),13 the initial auction
NBBO would be considered the NBBO
for SAM auction execution purposes.
Accordingly, a SAM order execution
outside of the NBBO would not violate
the order protection rules if the
execution price were within the NBBO
that existed when the Agency Order was
received in the System. The Exchange
believes that the proposed rule changes
would promote consistency within the
Rules and across the Exchange’s various
9 SAM
auction functionality is not active on C2.
future activation of SAM will be
announced via Regulatory Circular prior to
activation.
11 The Exchange believes that its proposal to
consider the NBBO as of the time that the Agency
Order is received in the System for purposes of the
entire auction period (i.e. 1 second) is consistent
with order protection principles.
12 See Id.
13 See Rule 6.52(b)(1)(C).
10 Any
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auction procedures.14 The Exchange
also believes that the proposed rule
changes would further the interests of
investors and market participants by
helping to ensure best executions and
protection of bids and offers across
multiple exchanges.
The following example demonstrates
how the Exchange’s proposal would
provide order protection within the
context of the SAM auction rules.
Assume that the NBBO for a particular
option is $1.00–$1.20 with quotes on
both sides for 100 contracts each. The
C2 BBO is $0.95–$1.25. The minimum
increment in the class is $0.01. An
Initiating Participant submits an Agency
Order to buy 500 contracts against a
solicited order to sell 500 contracts into
SAM priced at $1.21. An RFR is
transmitted to Participants that have
elected to receive auction messages
without any response. In this case,
under current Rule 6.52(b)(2)(A), the
Agency Order would be executable
against the solicited order because the
execution price of $1.21 improves the
C2 best offer price of $1.25. Such
execution, however, would be in
violation of the Exchange’s order
protection rules because the Agency
Order would have been executed
outside of the NBBO of $1.00–$1.20.
The Exchange proposes to remedy this
inconsistency in the Rules by changing
references to the BBO to NBBO and
defining the term ‘‘initial auction
NBBO’’ to mean priced at or within the
NBBO as of the time of the initiation of
the Auction (i.e., the time that the
Agency Order is received in the
System). Under the Exchange’s
proposal, the Agency Order would be
rejected by the System and cancelled by
the Exchange because, at the time when
the Agency Order to buy 500 contracts
priced at $1.21 was received in the
System, the solicited order would have
been outside of the NBBO of $1.00–
$1.20.
The Exchange’s proposal would not,
however, change the priority of public
customer orders resting in the book.
Assume again that the NBBO for a
particular option is $1.00–$1.20 with
quotes on both sides for 100 contracts
each. Assume this time, however, that
there is also a public customer order to
sell 50 contracts resting in the book at
$1.20. The C2 BBO is $0.95–$1.20. An
Initiating Participant submits an Agency
Order to buy 500 contracts against a
solicited order to sell 500 contracts into
SAM priced at $1.20. An RFR is
14 The Exchange also notes that the proposed
order protection rule changes are consistent with
similar electronic price improvement auction rules
of other exchanges. See, e.g., BOX Rule 7270(b)(2)(i)
(Block Trades).
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32999
transmitted to Participants that have
elected to receive auction messages with
a single response to sell 150 contracts
also at $1.20. In this case, under both
current Rule 6.52(b)(2)(A) and the
Exchange’s proposed rule change, both
the Agency Order and solicited order
would be cancelled because there is a
public customer order resting in the
book on the opposite side of the Agency
Order at the proposed price without
sufficient size (considering all resting
orders (i.e. 50), electronic quotes (i.e.
100), and responses (i.e. 150) (50 + 100
+ 150 = 300)).15
The Exchange also proposes to amend
Rules 6.52(b)(1)(B) to further make clear
that upon receiving a properly
designated Agency Order for SAM
Auction processing, the Exchange’s RFR
message would indicate the price, side,
and size of the Agency Order that the
Initiating Participant is seeking to cross.
Rule 6.52(b)(1)(B) currently provides
that the Exchange will send an RFR
message to all Participants that have
elected to receive such messages,
indicating the price and size of the
Agency Order that the Initiating
Participant is seeking to cross, but does
not currently specify that the RFR will
also indicate the side (i.e. buy v. sell) of
the Agency Order that the Initiating
Participant is seeking to cross.16 In order
to add additional clarity to the Rules
and in an effort to minimize confusion
among market participants, the
Exchange proposes to add the ‘‘side’’
indication requirement to the SAM
auction rules. The Exchange believes
that the proposed changes will provide
additional clarity regarding the
Exchange’s SAM auction processes and
reduce the potential for confusion in the
Rules.
15 See Rule 6.52(b)(2)(A). Note, however, that in
this example, under both the current and proposed
rules, had the resting order in the book to sell 50
contracts at $1.20 been a Market-Maker quote or
order rather than a public customer order, the
Agency Order to buy 500 contracts would trade
against the solicited order at $1.20 because there
would not have been a public customer order in the
book on the opposite side of the Agency Order and
there would have been insufficient size to execute
the Agency Order at a price equal to, or better than,
the initial auction NBBO. See Rules
6.52(b)(2)(A)(ii)–(iii).
16 The Exchange’s other auction rules require the
side of the Agency Order to be indicated in the RFR.
See, e.g., Rule 6.51(b)(1)(B), Automated
Improvement Mechanism, which provides that the
Initiating Participant must expressly disclose the
side of the Agency Order that it seeks to cross.
(‘‘When the Exchange receives a properly
designated Agency Order for Auction processing, a
Request for Responses (‘‘RFR’’) detailing the side
and size of the order will be sent to all Participants
that have elected to receive RFRs.’’ Emphasis
added.)
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Federal Register / Vol. 80, No. 111 / Wednesday, June 10, 2015 / Notices
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the Act
and the rules and regulations
thereunder applicable to the Exchange
and, in particular, the requirements of
section 6(b) of the Act.17 Specifically,
the Exchange believes the proposed rule
change is consistent with the section
6(b)(5) 18 requirements that the rules of
an exchange be designed to prevent
fraudulent and manipulative acts and
practices, to promote just and equitable
principles of trade, to foster cooperation
and coordination with persons engaged
in regulating, clearing, settling,
processing information with respect to,
and facilitating transactions in
securities, 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.
Additionally, the Exchange believes the
proposed rule change is consistent with
the section 6(b)(5) 19 requirement that
the rules of an exchange not be designed
to permit unfair discrimination between
customers, issuers, brokers, or dealers.
In particular, the Exchange believes
that the proposed changes would ensure
further consistency within the
Exchange’s Rules. The Exchange also
believes that the proposed rule changes
would further the objectives of the Act
to protect investors by promoting the
intermarket price protection goals of the
Exchange’s order protection rules and
the Options Order Protection and
Locked/Crossed Market Plan.20 The
Exchange believes its proposal would
help ensure intermarket competition
across all exchanges, aid in preventing
intermarket trade-throughs, and
facilitate compliance with best
execution practices. The Exchange
believes that these objectives are
consistent with the Act and the rules
and regulations thereunder applicable to
the Exchange and, in particular, the
requirements of section 11A of the Act.
In addition, the Exchange believes that
the proposed rule changes will clarify
the manner in which orders are
submitted into the SAM auction process
and reduce the potential for confusion
17 15
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18 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
19 Id.
20 See generally File No. 4–546: Proposed Options
Order Protection and Locked/Crossed Market Plan
by BSE, CBOE, ISE, Nasdaq, NYSE Arca,
NYSEALTR, and Phlx; File No. 4–546: Amendment
No. 1 to Proposed Options Order Protection and
Locked/Crossed Market Plan by CBOE (Nov. 21,
2008); see also Securities and Exchange Act Release
No. 34–43086 (July 28, 2000), 65 FR 48023 (August
4, 2000) (Order Approving Options Intermarket
Linkage Plan) (File No. 4–429).
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in the Rules. The Exchange believes that
providing additional clarity to its Rules
furthers the goal of promoting
transparency in markets, which is in the
best interests of market participants and
the general public and consistent with
the Act.
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. Rather, the
Exchange believes that the proposed
rule would bolster intermarket
competition by promoting fair
competition among individual markets,
while at the same time assuring that
market participants receive the benefits
of markets that are linked together,
through facilities and rules, in a unified
system, which promotes interaction
among the orders of buyers and sellers.
The Exchange believes its proposal
would help ensure intermarket
competition across all exchanges, aid in
preventing intermarket trade-throughs,
and facilitate compliance with best
execution practices. In addition, the
Exchange believes that the proposed
rule change would help promote fair
and orderly markets by helping to
ensure compliance with the order
protection rules. Thus, the Exchange
does not believe the proposal creates
any significant impact on competition.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange 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 21 and Rule 19b–4(f)(6) 22
thereunder.
21 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6) requires a self-regulatory organization to give
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
22 17
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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 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–
C2–2015–014 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–C2–2015–014. 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
change, or such short time as designated by the
Commission. The Exchange has satisfied this
requirement.
E:\FR\FM\10JNN1.SGM
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Federal Register / Vol. 80, No. 111 / Wednesday, June 10, 2015 / Notices
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–C2–
2015–014 and should be submitted on
or before July 1, 2015.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.23
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015–14133 Filed 6–9–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–75104; File No. SR–ISE–
2014–24]
Self-Regulatory Organizations;
International Securities Exchange,
LLC; Notice of Designation of Longer
Period for Commission Action on
Proceedings To Determine Whether To
Approve or Disapprove a Proposed
Rule Change To Modify the Opening
Process
asabaliauskas on DSK5VPTVN1PROD with NOTICES
June 4, 2015.
On November 19, 2014, International
Securities Exchange, LLC (‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to modify the manner in which
the Exchange’s trading system opens
trading at the beginning of the day and
after trading halts and to codify certain
existing functionality within the trading
system regarding opening and reopening
of options classes traded on the
Exchange. The proposed rule change
was published for comment in the
Federal Register on December 10,
2014.3 On January 23, 2015, the
Commission extended the time period
within which to approve the proposed
rule change, disapprove the proposed
rule change, or institute proceedings to
determine whether to disapprove the
proposed rule change, to March 10,
2015.4 On March 10, 2015, the
Commission instituted proceedings
under section 19(b)(2)(B) of the Act 5 to
determine whether to approve or
23 17
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 73736
(December 4, 2014), 79 FR 73354.
4 See Securities Exchange Act Release No. 74126
(January 23, 2015), 80 FR 4953 (January 29, 2015).
5 15 U.S.C. 78s(b)(2)(B).
VerDate Sep<11>2014
16:46 Jun 09, 2015
Jkt 235001
disapprove the proposed rule change.6
On May 13, 2015, the Commission
received a letter from the Exchange
responding to the Order Instituting
Proceedings.7 The Commission received
one other comment letter on the
proposed rule change.8
Section 19(b)(2) of the Act provides
that proceedings to determine whether
to disapprove a proposed rule change
must be concluded within 180 days of
the date of publication of notice of the
filing of the proposed rule change.9 The
time for conclusion of the proceedings
may be extended for up to 60 days if the
Commission determines that a longer
period is appropriate and publishes the
reasons for such determination.10 The
180th day for this filing is June 8, 2015.
The Commission is extending the
time period for Commission action on
the proposed rule change. The
Commission finds that it is appropriate
to designate a longer period within
which to take action on the proposed
rule change so that it has sufficient time
to consider the comment letters and take
action on the Exchange’s proposed rule
change.
Accordingly, pursuant to section
19(b)(2)(B)(ii)(II) of the Act 11 and for the
reasons stated above, the Commission
designates August 7, 2015, as the date
by which the Commission should either
approve or disapprove the proposed
rule change(File No. SR–ISE–2014–24).
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015–14131 Filed 6–9–15; 8:45 am]
BILLING CODE 8011–01–P
6 See Securities Exchange Act Release No. 74465
(March 10, 2015), 80 FR 13660 (March 16, 2015)
(‘‘Order Instituting Proceedings’’).
7 See Letter to Brent J. Fields, Secretary,
Commission, from Mike Simon, Secretary and
General Counsel, dated May 13, 2015 (‘‘ISE Letter’’).
8 See Letter to Brent J. Fields, Secretary,
Commission, from Benjamin Londergan, Head of
Options Trading and Technology, Convergex
Execution Solutions LLC, dated June 1, 2015.
9 15 U.S.C. 78s(b)(2)(B)(ii)(I).
10 15 U.S.C. 78s(b)(2)(B)(ii)(II).
11 15 U.S.C. 78s(b)(2)(B)(ii)(II).
12 17 CFR 200.30–3(a)(57).
PO 00000
Frm 00073
Fmt 4703
Sfmt 4703
33001
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–75107; File No. SR–BATS–
2015–40]
Self-Regulatory Organizations; BATS
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Adopt Rule 13.8
Describing a Communication and
Routing Service Known as BATS
Connect
June 4, 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 May 27,
2015, BATS Exchange, Inc. (the
‘‘Exchange’’ or ‘‘BATS’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) the proposed rule
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)(iii)
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 is proposing to adopt
Rule 13.8 to describe a communication
and routing service known as BATS
Connect. The proposed rule change is
based on an identical service offered by
the Exchange’s affiliate, EDGX
Exchange, Inc. (‘‘EDGX’’).5
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
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(6)(iii).
5 See EDGX Rule 13.9. See also Securities
Exchange Act Release Nos. 73780 (December 8,
2014), 79 FR 73942 (December 12, 2014) (SR–
EDGX–2014–28); and 74935 (May 12, 2015), 80 FR
28335 (May 18, 2015) (SR–EDGX–2015–19).
2 17
E:\FR\FM\10JNN1.SGM
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]]>Agencies
[Federal Register Volume 80, Number 111 (Wednesday, June 10, 2015)]
[Notices]
[Pages 32997-33001]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-14133]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-75106; File No. SR-C2-2015-014]
Self-Regulatory Organizations; C2 Options Exchange, Incorporated;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
Relating to the Solicitation Auction Mechanism
June 4, 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 May 27, 2015, C2 Options Exchange, Incorporated (the
``Exchange'' or ``C2'') 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
Exchange. 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.
---------------------------------------------------------------------------
[[Page 32998]]
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Rules 6.52 relating to the
Solicitation Auction Mechanism (``SAM''). The text of the proposed rule
change is provided below. (additions are italicized; deletions are
[bracketed])
* * * * *
C2 Options Exchange, Incorporated
Rules
* * * * *
Rule 6.52. Solicitation Auction Mechanism
A Participant that represents agency orders may electronically
execute orders it represents as agent (``Agency Order'') against
solicited orders provided it submits the Agency Order for electronic
execution into the solicitation auction mechanism (the ``Auction'')
pursuant to this Rule.
(a) Auction Eligibility Requirements. A Participant (the
``Initiating Participant'') may initiate an Auction provided all of the
following are met:
(1) The Agency Order is in a class designated as eligible for
Auctions as determined by the Exchange and within the designated
Auction order eligibility size parameters as such size parameters are
determined by the Exchange (however, the eligible order size may not be
less than 500 standard option contracts or 5,000 mini-option
contracts);
(2) Each order entered into the Auction shall be designated as all-
or-none and must be stopped with a solicited order priced at or within
the NBBO as of the time of the initiation of the Auction (i.e. the time
that the Agency Order is received in the System (the ``initial auction
NBBO''); and
(3) The minimum price increment for an Initiating Participant's
single price submission shall be determined by the Exchange on a series
basis and may not be smaller than one cent.
(b) Auction Process. The Auction shall proceed as follows:
(1) Auction Period and Requests for Responses.
(A) To initiate the Auction, the Initiating Participant must mark
the Agency Order for Auction processing, and specify a single price at
which it seeks to cross the Agency Order with a solicited order priced
at or within the initial auction NBBO.
(B) When the Exchange receives a properly designated Agency Order
for Auction processing, a Request for Responses message indicating the
price, side, and size at which it seeks to cross the Agency Order with
a solicited order will be sent to all Participants that have elected to
receive such messages.
(C)-(G) No change.
(2) Auction Conclusion and Order Allocation. The Auction shall
conclude at the sooner of subparagraphs (b)(2)(A) through (E) of Rule
6.51. At the conclusion of the Auction, the Agency Order will be
automatically executed in full or cancelled and allocated subject to
the following:
(A) The Agency Order will be executed against the solicited order
at the proposed execution price, provided that:
(i) The execution price must be equal to or better than the initial
auction NBBO. If the execution would take place outside the initial
auction NBBO, the Agency Order and solicited order will be cancelled;
(ii)-(iii) No change.
. . . Interpretations and Policies:
.01-.03 No change.
* * * * *
The text of the proposed rule change is also available on the
Exchange's Web site (https://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the
Secretary, 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 aspects 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 make changes to its existing SAM auction
rules in Rule 6.52. The Exchange believes that the proposed amendments
would ensure greater consistency between the Exchange's SAM auction and
order protection rules \3\ and provide additional clarity in the Rules
regarding the Exchange's SAM Auction procedures.
---------------------------------------------------------------------------
\3\ See Section E of C2 Rules Chapter 6 relating to Intermarket
Linkage (``Intermarket Linkage Rule'') (providing that the rules
contained in Section E of CBOE Chapter IV relating to the Options
Order Protection and Locked/Crossed Market Plan shall apply to C2).
---------------------------------------------------------------------------
Rule 6.52 permits Participants to electronically execute all-or-
none (``AON'') orders for 500 or more standard options contracts or
5,000 or more mini-options contracts that they represent as agent
(``Agency Order'') against solicited orders provided the Participant
submits the Agency Order for electronic execution into SAM for auction
(the ``Auction'') pursuant to Rule 6.52.\4\ Under Rules 6.52(a)(2) and
(b)(1)(A), each order entered into SAM shall be designated AON by the
Initiating Participant with the Agency Order marked for auction
processing with a specific single price at which the Initiating
Participant seeks to cross the Agency Order with the solicited order.
Pursuant to Rule 6.52(b)(2)(A)(i), the Agency Order will be executed
against the solicited order at the proposed execution price, provided
that, among other things, the execution price must be equal to or
better than the C2 best bid or offer (``BBO''). If the execution would
take place outside the BBO, the Agency Order and solicited order will
be cancelled.\5\
---------------------------------------------------------------------------
\4\ SAM functionality is currently inactive on the Exchange.
\5\ See Rule 6.52(b)(2)(A)(i).
---------------------------------------------------------------------------
Although Participants are subject to the Exchange's order
protection rules and thus, prevented from trading through the displayed
national best bid and offer (``NBBO''), including within the context of
SAM auctions,\6\ current Rule 6.52 does not specifically require
Initiating Participants to stop Agency Orders at or within the NBBO or
expressly prohibit Agency Orders from being executed against solicited
orders at prices outside the NBBO.\7\ In addition, current Rule 6.52
does not specify whether the Agency Order may be executed against a
solicited order priced at or within the BBO as of the time that the
Agency Order is received in the System,\8\ as of the time of the
beginning of the auction (i.e. the time when requests for responses
(``RFRs'')
[[Page 32999]]
are sent), or as of the time of execution.\9\ Accordingly, the Exchange
is proposing to make several clarifying amendments to Rule 6.52 to
require that Agency Orders be stopped and executed at or within the
NBBO and to define when the NBBO will be looked at for purposes of
order protection during the SAM auction process.\10\
---------------------------------------------------------------------------
\6\ See section E of C2 Rules Chapter 6 relating to Intermarket
Linkage (``Intermarket Linkage Rule'') (providing that the rules
contained in section E of CBOE Chapter IV relating to the Options
Order Protection and Locked/Crossed Market Plan shall apply to C2).
\7\ Notably, the Exchange's other auction rules expressly
provide that Initiating Participants must stop Agency Orders at or
within the NBBO and prohibit Agency Orders from being executed
against solicited orders at prices outside the NBBO. See Rule
6.51(b) (Automated Improvement Mechanism (``AIM'')).
\8\ See Rule 1.1 (System) (defining the term ``System'' to mean
``the automated trading system used by the Exchange for the trading
of options contracts'').
\9\ SAM auction functionality is not active on C2.
\10\ Any future activation of SAM will be announced via
Regulatory Circular prior to activation.
---------------------------------------------------------------------------
Specifically, the Exchange is proposing to amend Rules 6.52(a)(2),
6.52(b)(1)(A), and 6.52(b)(2)(A)(i) to provide that Agency Orders
submitted into SAM must be stopped with a solicited order priced at or
within the national best bid or offer (``NBBO'') as of the time of the
initiation of the Auction (i.e. the time that the Agency Order is
received for SAM auction processing in the System) (the ``initial
auction NBBO'') and that Agency Orders that are submitted for
electronic execution into SAM must be executed at a price at or better
than the initial auction NBBO.\11\ Agency Orders paired against
solicited orders priced outside of the NBBO that are submitted for
electronic execution into SAM would be rejected by the System and
cancelled by the Exchange.
---------------------------------------------------------------------------
\11\ The Exchange believes that its proposal to consider the
NBBO as of the time that the Agency Order is received in the System
for purposes of the entire auction period (i.e. 1 second) is
consistent with order protection principles.
---------------------------------------------------------------------------
The Exchange believes that requiring SAM orders to be stopped and
executed at a price equal to, or better than, the NBBO as of the time
of receipt of the Agency Order in the OHS is consistent with the
Exchange's Intermarket Linkage Rule. As proposed, the range of
permissible crossing prices and executions would be defined based on a
snapshot of the market at the time when the Agency Order is
received.\12\ This proposed rule change would thus, make clear that
although the NBBO may update during the SAM auction response time
(currently SAM auctions last one second),\13\ the initial auction NBBO
would be considered the NBBO for SAM auction execution purposes.
Accordingly, a SAM order execution outside of the NBBO would not
violate the order protection rules if the execution price were within
the NBBO that existed when the Agency Order was received in the System.
The Exchange believes that the proposed rule changes would promote
consistency within the Rules and across the Exchange's various auction
procedures.\14\ The Exchange also believes that the proposed rule
changes would further the interests of investors and market
participants by helping to ensure best executions and protection of
bids and offers across multiple exchanges.
---------------------------------------------------------------------------
\12\ See Id.
\13\ See Rule 6.52(b)(1)(C).
\14\ The Exchange also notes that the proposed order protection
rule changes are consistent with similar electronic price
improvement auction rules of other exchanges. See, e.g., BOX Rule
7270(b)(2)(i) (Block Trades).
---------------------------------------------------------------------------
The following example demonstrates how the Exchange's proposal
would provide order protection within the context of the SAM auction
rules. Assume that the NBBO for a particular option is $1.00-$1.20 with
quotes on both sides for 100 contracts each. The C2 BBO is $0.95-$1.25.
The minimum increment in the class is $0.01. An Initiating Participant
submits an Agency Order to buy 500 contracts against a solicited order
to sell 500 contracts into SAM priced at $1.21. An RFR is transmitted
to Participants that have elected to receive auction messages without
any response. In this case, under current Rule 6.52(b)(2)(A), the
Agency Order would be executable against the solicited order because
the execution price of $1.21 improves the C2 best offer price of $1.25.
Such execution, however, would be in violation of the Exchange's order
protection rules because the Agency Order would have been executed
outside of the NBBO of $1.00-$1.20. The Exchange proposes to remedy
this inconsistency in the Rules by changing references to the BBO to
NBBO and defining the term ``initial auction NBBO'' to mean priced at
or within the NBBO as of the time of the initiation of the Auction
(i.e., the time that the Agency Order is received in the System). Under
the Exchange's proposal, the Agency Order would be rejected by the
System and cancelled by the Exchange because, at the time when the
Agency Order to buy 500 contracts priced at $1.21 was received in the
System, the solicited order would have been outside of the NBBO of
$1.00-$1.20.
The Exchange's proposal would not, however, change the priority of
public customer orders resting in the book. Assume again that the NBBO
for a particular option is $1.00-$1.20 with quotes on both sides for
100 contracts each. Assume this time, however, that there is also a
public customer order to sell 50 contracts resting in the book at
$1.20. The C2 BBO is $0.95-$1.20. An Initiating Participant submits an
Agency Order to buy 500 contracts against a solicited order to sell 500
contracts into SAM priced at $1.20. An RFR is transmitted to
Participants that have elected to receive auction messages with a
single response to sell 150 contracts also at $1.20. In this case,
under both current Rule 6.52(b)(2)(A) and the Exchange's proposed rule
change, both the Agency Order and solicited order would be cancelled
because there is a public customer order resting in the book on the
opposite side of the Agency Order at the proposed price without
sufficient size (considering all resting orders (i.e. 50), electronic
quotes (i.e. 100), and responses (i.e. 150) (50 + 100 + 150 =
300)).\15\
---------------------------------------------------------------------------
\15\ See Rule 6.52(b)(2)(A). Note, however, that in this
example, under both the current and proposed rules, had the resting
order in the book to sell 50 contracts at $1.20 been a Market-Maker
quote or order rather than a public customer order, the Agency Order
to buy 500 contracts would trade against the solicited order at
$1.20 because there would not have been a public customer order in
the book on the opposite side of the Agency Order and there would
have been insufficient size to execute the Agency Order at a price
equal to, or better than, the initial auction NBBO. See Rules
6.52(b)(2)(A)(ii)-(iii).
---------------------------------------------------------------------------
The Exchange also proposes to amend Rules 6.52(b)(1)(B) to further
make clear that upon receiving a properly designated Agency Order for
SAM Auction processing, the Exchange's RFR message would indicate the
price, side, and size of the Agency Order that the Initiating
Participant is seeking to cross. Rule 6.52(b)(1)(B) currently provides
that the Exchange will send an RFR message to all Participants that
have elected to receive such messages, indicating the price and size of
the Agency Order that the Initiating Participant is seeking to cross,
but does not currently specify that the RFR will also indicate the side
(i.e. buy v. sell) of the Agency Order that the Initiating Participant
is seeking to cross.\16\ In order to add additional clarity to the
Rules and in an effort to minimize confusion among market participants,
the Exchange proposes to add the ``side'' indication requirement to the
SAM auction rules. The Exchange believes that the proposed changes will
provide additional clarity regarding the Exchange's SAM auction
processes and reduce the potential for confusion in the Rules.
---------------------------------------------------------------------------
\16\ The Exchange's other auction rules require the side of the
Agency Order to be indicated in the RFR. See, e.g., Rule
6.51(b)(1)(B), Automated Improvement Mechanism, which provides that
the Initiating Participant must expressly disclose the side of the
Agency Order that it seeks to cross. (``When the Exchange receives a
properly designated Agency Order for Auction processing, a Request
for Responses (``RFR'') detailing the side and size of the order
will be sent to all Participants that have elected to receive
RFRs.'' Emphasis added.)
---------------------------------------------------------------------------
[[Page 33000]]
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of section 6(b) of the
Act.\17\ Specifically, the Exchange believes the proposed rule change
is consistent with the section 6(b)(5) \18\ requirements that the rules
of an exchange be designed to prevent fraudulent and manipulative acts
and practices, to promote just and equitable principles of trade, to
foster cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, 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.
Additionally, the Exchange believes the proposed rule change is
consistent with the section 6(b)(5) \19\ requirement that the rules of
an exchange not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------
\17\ 15 U.S.C. 78f(b).
\18\ 15 U.S.C. 78f(b)(5).
\19\ Id.
---------------------------------------------------------------------------
In particular, the Exchange believes that the proposed changes
would ensure further consistency within the Exchange's Rules. The
Exchange also believes that the proposed rule changes would further the
objectives of the Act to protect investors by promoting the intermarket
price protection goals of the Exchange's order protection rules and the
Options Order Protection and Locked/Crossed Market Plan.\20\ The
Exchange believes its proposal would help ensure intermarket
competition across all exchanges, aid in preventing intermarket trade-
throughs, and facilitate compliance with best execution practices. The
Exchange believes that these objectives are consistent with the Act and
the rules and regulations thereunder applicable to the Exchange and, in
particular, the requirements of section 11A of the Act. In addition,
the Exchange believes that the proposed rule changes will clarify the
manner in which orders are submitted into the SAM auction process and
reduce the potential for confusion in the Rules. The Exchange believes
that providing additional clarity to its Rules furthers the goal of
promoting transparency in markets, which is in the best interests of
market participants and the general public and consistent with the Act.
---------------------------------------------------------------------------
\20\ See generally File No. 4-546: Proposed Options Order
Protection and Locked/Crossed Market Plan by BSE, CBOE, ISE, Nasdaq,
NYSE Arca, NYSEALTR, and Phlx; File No. 4-546: Amendment No. 1 to
Proposed Options Order Protection and Locked/Crossed Market Plan by
CBOE (Nov. 21, 2008); see also Securities and Exchange Act Release
No. 34-43086 (July 28, 2000), 65 FR 48023 (August 4, 2000) (Order
Approving Options Intermarket Linkage Plan) (File No. 4-429).
---------------------------------------------------------------------------
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. Rather, the Exchange
believes that the proposed rule would bolster intermarket competition
by promoting fair competition among individual markets, while at the
same time assuring that market participants receive the benefits of
markets that are linked together, through facilities and rules, in a
unified system, which promotes interaction among the orders of buyers
and sellers. The Exchange believes its proposal would help ensure
intermarket competition across all exchanges, aid in preventing
intermarket trade-throughs, and facilitate compliance with best
execution practices. In addition, the Exchange believes that the
proposed rule change would help promote fair and orderly markets by
helping to ensure compliance with the order protection rules. Thus, the
Exchange does not believe the proposal creates any significant impact
on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange 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 \21\ and
Rule 19b-4(f)(6) \22\ thereunder.
---------------------------------------------------------------------------
\21\ 15 U.S.C. 78s(b)(3)(A).
\22\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give 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 short time as designated by the Commission. The
Exchange has satisfied this requirement.
---------------------------------------------------------------------------
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 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-C2-2015-014 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-C2-2015-014. 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
[[Page 33001]]
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-C2-
2015-014 and should be submitted on or before July 1, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\23\
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\23\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-14133 Filed 6-9-15; 8:45 am]
BILLING CODE 8011-01-P
