Self-Regulatory Organizations; International Securities Exchange; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Establish the Securities Trader and Securities Trader Principal Registration Categories, 1245-1249 [2016-248]
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Federal Register / Vol. 81, No. 6 / Monday, January 11, 2016 / Notices
trust registered under the Act as an
open-end management investment
company with multiple series,
Ascendant Advisors, LLC (‘‘Ascendant’’
or the ‘‘Adviser’’), a Texas limited
liability company registered as an
investment adviser under the
Investment Advisers Act of 1940, and
Northern Lights Distributors, LLC (the
‘‘Distributor’’), a Nebraska limited
liability company registered as a brokerdealer under the Securities Exchange
Act of 1934 (‘‘Exchange Act’’).
Filing Dates: The application was
filed on July 23, 2015 and amended on
December 9, 2015.
Hearing or Notification of Hearing: An
order granting the requested relief will
be issued unless the Commission orders
a hearing. Interested persons may
request a hearing by writing to the
Commission’s Secretary and serving
applicants with a copy of the request,
personally or by mail. Hearing requests
should be received by the Commission
by 5:30 p.m. on Friday, January 29, 2016
and should be accompanied by proof of
service on the applicants, in the form of
an affidavit, or, for lawyers, a certificate
of service. Pursuant to Rule 0–5 under
the Act, hearing requests should state
the nature of the writer’s interest, any
facts bearing upon the desirability of a
hearing on the matter, the reason for the
request, and the issues contested.
Persons who wish to be notified of a
hearing may request notification by
writing to the Commission’s Secretary.
ADDRESSES: Secretary, U.S. Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
Applicants: c/o JoAnn Strasser, Esq.,
Thompson Hine LLP, 41 South High
Street, Suite 1700, Columbus, Ohio
43215.
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FOR FURTHER INFORMATION CONTACT:
Kaitlin C. Bottock, Senior Counsel, at
(202) 551–8658, or Daniele Marchesani,
Branch Chief, at (202) 551–6821
(Division of Investment Management,
Chief Counsel’s Office).
SUPPLEMENTARY INFORMATION: The
following is a summary of the
application. The complete application
may be obtained via the Commission’s
Web site by searching for the file
number, or for an applicant using the
Company name box, at https://
www.sec.gov/search/search.htm, or by
calling (202) 551–8090.
Summary of the Application
1. Applicants request an order to
permit (a) a Fund 1 (each a ‘‘Fund of
1 Applicants request that the order apply to each
existing and future series of the Trust and to each
existing and future registered open-end investment
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Funds’’) to acquire shares of Underlying
Funds 2 in excess of the limits in
sections 12(d)(1)(A) and (C) of the Act
and (b) each Underlying Fund that is a
registered open-end investment
company or series thereof, the
Distributor or any principal underwriter
and any broker or dealer registered
under the Exchange Act to sell shares of
the Underlying Fund to the Fund of
Funds in excess of the limits in section
12(d)(1)(B) of the Act.3 Applicants also
request an order of exemption under
sections 6(c) and 17(b) of the Act from
the prohibition on certain affiliated
transactions in section 17(a) of the Act
to the extent necessary to permit the
Underlying Funds to sell their shares to,
and redeem their shares from, the Funds
of Funds.4 Applicants state that such
transactions will be consistent with the
policies of each Fund of Funds and each
Underlying Fund and with the general
purposes of the Act and will be based
on the net asset values of the
Underlying Funds.
2. Applicants agree that any order
granting the requested relief will be
subject to the terms and conditions
stated in the application. Such terms
and conditions are designed to, among
other things, help prevent any potential
(i) undue influence over an Underlying
Fund that is not in the same ‘‘group of
company or series thereof that is advised by
Ascendant or its successor-in-interest or by any
entity controlling, controlled by or under common
control with Ascendant or its successor-in-interest
and is part of the same ‘‘group of investment
companies’’ as the Trust (each, a ‘‘Fund’’). For
purposes of the requested order, ‘‘successor-ininterest’’ is limited to an entity that results from a
reorganization into another jurisdiction or a change
in the type of business organization. For purposes
of the request for relief, the term ‘‘group of
investment companies’’ means any two or more
investment companies, including closed-end
investment companies and business development
companies, that hold themselves out to investors as
related companies for purposes of investment and
investor services.
2 Certain of the Underlying Funds have obtained
exemptions from the Commission necessary to
permit their shares to be listed and traded on a
national securities exchange at negotiated prices
and, accordingly, to operate as exchange-traded
funds (‘‘ETFs’’).
3 Applicants do not request relief for the Funds
of Funds to invest in business development
companies or closed-end investment companies
that are not listed on a national securities exchange.
4 A Fund of Funds generally would purchase and
sell shares of an Underlying Fund that operates as
an ETF through secondary market transactions
rather than through principal transactions with the
Underlying Fund. Applicants nevertheless request
relief from section 17(a) to permit a Fund of Funds
to purchase or redeem shares from the ETF. A Fund
of Funds will purchase and sell shares of an
Underlying Fund that is a closed-end fund through
secondary market transactions at market prices
rather than through principal transactions with the
closed-end fund. Accordingly, applicants are not
requesting section 17(a) relief with respect to
transactions in shares of closed-end funds
(including business development companies).
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1245
investment companies’’ as the Fund of
Funds through control or voting power,
or in connection with certain services,
transactions, and underwritings, (ii)
excessive layering of fees, and (iii)
overly complex fund structures, which
are the concerns underlying the limits
in sections 12(d)(1)(A), (B), and (C) of
the Act.
3. Section 12(d)(1)(J) of the Act
provides that the Commission may
exempt any person, security, or
transaction, or any class or classes of
persons, securities, or transactions, from
any provision of section 12(d)(1) if the
exemption is consistent with the public
interest and the protection of investors.
Section 17(b) of the Act authorizes the
Commission to grant an order
permitting a transaction otherwise
prohibited by section 17(a) if it finds
that (a) the terms of the proposed
transaction are fair and reasonable and
do not involve overreaching on the part
of any person concerned; (b) the
proposed transaction is consistent with
the policies of each registered
investment company involved; and (c)
the proposed transaction is consistent
with the general purposes of the Act.
Section 6(c) of the Act permits the
Commission to exempt any persons or
transactions from any provision of the
Act if such exemption is necessary or
appropriate in the public interest and
consistent with the protection of
investors and the purposes fairly
intended by the policy and provisions of
the Act.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–210 Filed 1–8–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–76835; File No. SR–ISE–
2015–44]
Self-Regulatory Organizations;
International Securities Exchange;
Notice of Filing and Immediate
Effectiveness of Proposed Rule
Change To Establish the Securities
Trader and Securities Trader Principal
Registration Categories
January 5, 2016.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
1 15
2 17
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
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Federal Register / Vol. 81, No. 6 / Monday, January 11, 2016 / Notices
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notice is hereby given that on December
23, 2015, the International Securities
Exchange, LLC (the ‘‘Exchange’’ or the
‘‘ISE’’) filed with the Securities and
Exchange Commission the proposed
rule change as described in Items I, II,
and III below, of which Items I and II
have been prepared by the selfregulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
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
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
ISE proposes to codify, in the
Supplementary Material to Rule 313
Registration Requirements, the
categories of registration and respective
qualification examinations required for
individual associated persons
(‘‘associated persons’’) that engage in
the securities activities of members on
the Exchange. Specifically, the
Exchange proposes to (1) replace the
Proprietary Trader registration category
and the Series 56 Proprietary Trader
registration qualification examination
with the newly codified Securities
Trader category of registration and the
Series 57 Securities Trader registration
qualification examination for Securities
Traders respectively and (2) replace the
Proprietary Trader Principal registration
category with the newly codified
registration category of Securities Trader
Principal and require Securities Trader
Principals to take the Series 57
qualification examination in addition to
the Series 24 qualification examination.
The Exchange also proposes to amend
Rule 604, Continuing Education for
Registered Persons, by deleting the rule
text referring to the S501 continuing
education program currently applicable
to Proprietary Traders and replacing it
with the S101, and replacing a reference
to the Series 56 with the 57.
Specifically, the Exchange proposes that
Series 57 registered persons take the
S101 General Program for Series 7 and
all other registered persons. Finally, the
Exchange proposes to amend Rule 604
to provide for Web-based delivery of the
continuing education regulatory
element for registered persons. The text
of the proposed rule change is available
on the Exchange’s Web site at
www.ise.com, at the principal office of
the Exchange, and at the Commission’s
Public Reference Room.
1. Purpose
The Exchange proposes to amend
Rule 313 Registration Requirements.
This amendment will replace the
Proprietary Trader (PT) registration
category and qualification examination
(Series 56) with the newly codified
Securities Trader (TD) registration
category and qualification examination
(Series 57). In addition, the Exchange
proposes to replace the Proprietary
Trader Principal (TP) registration
category with the newly codified
Securities Trader Principal (TP)
registration category for associated
persons who either: (i) Supervise or
monitor proprietary trading, marketmaking and/or brokerage activities for
broker-dealers; (ii) supervise or train
those engaged in proprietary trading,
market-making and/or effecting
transactions on behalf of a brokerdealer, with respect to those activities;
and/or (iii) are officers, partners or
directors of a member, as described in
paragraph in proposed paragraph (a) to
.08 of Supplementary Material to Rule
313. The Exchange also proposes to
replace the Proprietary Trader
Compliance Officer (CT) registration
category with the newly codified
Securities Trader Compliance Officer
(CT) registration category for Chief
Compliance Officers (or individuals
performing similar functions) of a
member or member organization. This
filing is, in all material respects, based
upon SR–FINRA–2015–015 and 2015–
017, and SR–C2–2015–027.3
Currently, Rule 313 requires, among
other things, an associated person
engaged or to be engaged in the
securities business of a member to
register with the Exchange in the
category of registration appropriate to
the function to be performed and to pass
the qualification examination
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
3 See Securities Exchange Act Release No. 75581
(July 31, 2015), 80 FR 47018 (August 6, 2015) (SR–
FINRA–2015–015); Securities Exchange Act Release
No. 75783 (August 28, 2015), 80 FR 53369
(September 3, 2015) (SR–FINRA–2015–017); and
Securities Exchange Act Release No. 76408
(November 10, 2015) (SR–C2–2015–027).
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appropriate to the category of
registration as prescribed by the
Exchange. Among the qualification and
registration requirements set forth by
the Exchange, an associated person who
engages in proprietary trading, marketmaking, or effecting transactions on
behalf of a broker-dealer must register
and qualify as a Proprietary Trader (PT)
in WebCRD.4 To qualify as a Proprietary
Trader, an associated person must either
pass the Series 56 Proprietary Trader
qualification examination 5 or Series 7
General Securities Representative
qualification examination. Several
exchanges, including ISE currently use
the Series 56 examination as a
qualification standard.6
.07 of Supplementary Material to Rule
313 further requires that an associated
person with supervisory responsibility
over proprietary trading activities or
who is an (i) officer; (ii) partner; (iii)
director; (iv) supervisor of proprietary
trading, market-making or brokerage
activities; and/or (v) supervisor of those
engaged in proprietary trading, marketmaking or brokerage activities with
respect to those activities is required to
register and qualify as a Proprietary
Trader Principal (TP) in WebCRD and
satisfy prerequisite registration and
qualification requirements, including,
but not limited to passing the Series 24
General Securities Principal
4 WebCRD is a secure registration and licensing
system operated by FINRA and is the central
licensing and registration system for the U.S.
securities industry and its regulators. The system
contains the registration records of more than 6,500
registered broker-dealers, and the qualification,
employment and disclosure histories of more than
650,000 active registered associated persons. In
addition, Web CRD facilitates the processing and
payment of FINRA registration-related fees such as
form filings, fingerprint submissions, qualification
exams and continuing education sessions.
5 The Series 56 Proprietary Trader Examination is
a two hour and thirty minute exam, consisting of
100 scored multiple-choice questions. The Series 56
examination is administered by FINRA, but is not
recognized by FINRA as an acceptable qualification
examination for associated persons engaged in
securities trading. Under FINRA rules, associated
persons of FINRA members that engage in over-thecounter securities trading are required to pass the
Series 55 Equity Trader Exam. Nevertheless, as
FINRA has recognized, because the Series 55 and
Series 56 are intended to test the core knowledge
required of associated persons engaged in trading
activities as well as self-regulatory organization
(‘‘SRO’’) rules, including trading rules that are
common across all SROs, there is significant
overlap in the content of the Series 55 and Series
56 qualification examinations. See Securities
Exchange Act Release No. 75394 (July 8, 2015), 80
FR 41119 (Notice of Filing of a Proposed Rule
Change to Establish the Securities Trader and
Securities Trader Principal Registration Categories)
(SR–FINRA–2015–017).
6 See, e.g., BATS Exchange, Inc. (‘‘BATS’’)
Interpretation and Policy .01 to Rule 2.5
(Proficiency Examinations); Miami International
Securities Exchange, LLC (‘‘MIAX’’) Rule 1302
(Registration of Representatives).
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Examination or an acceptable
alternative qualification examination.
An associated person who is a Chief
Compliance Officer (or performs similar
functions) for a member that engages in
proprietary trading, market-making, or
effecting transactions on behalf of a
broker-dealer is also required to register
and qualify as a Proprietary Trader
Compliance Officer (CT) in WebCRD
and satisfy the prerequisite registration
and qualification requirements,
including, but not limited to passing the
Series 14 Compliance Official
Examination or an acceptable
alternative qualification exam.
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Codification of Examination and
Registration Requirements
The Exchange proposes to replace the
Series 56 qualification examination with
the newly codified Series 57
qualification examination for those
registration categories where the Series
56 is currently an acceptable
qualification standard. Specifically,
with respect to the Proprietary Trader
registration, the Exchange proposes to
replace the Proprietary Trader (PT)
registration category with the newly
codified Securities Trader (TD)
registration category as well as eliminate
the current Series 56 Proprietary Trader
Exam prerequisite and, instead, include
a Series 57 Securities Trader
qualification examination in its place.7
The Proprietary Trader Principal (PT)
and Proprietary Trader Compliance
Officer (CT) registration categories
would be replaced with the newly
codified renamed registration categories
of Securities Trader Principal (TP) and
Securities Trader Compliance Officer
respectively (CT).8
The Exchange will announce the
effective date of the proposed rule
change in a Regulatory Circular.
Currently, the Exchange intends for the
7 Neither the Exchange’s current Rules nor the
proposal would require that a Proprietary Trader or
Securities Trader work at, or be associated with, a
‘‘proprietary trading firm.’’ Rather, both the current
Rules and the proposal would require that an
associated person that engages in proprietary
trading, market-making, or effecting transactions on
behalf of a broker-dealer qualify and register as a
Proprietary Trader (or Securities Trader) in
WebCRD. Whereas the current rule allows an
associated person to qualify and register as a
Proprietary Trader by either passing the Series 56
Proprietary Trader qualification examination or
Series 7 General Securities Representative
qualification examination, the proposal would
require an associated person to pass the Series 57
Securities Trader qualification examination in order
to qualify as a Securities Trader after the effective
date of the proposal.
8 As is the case under the current Rules, under the
proposed rule, only individuals qualified and
registered as a Proprietary Trader Principal (TP)
(Securities Trader Principal TP)) would be
permitted to supervise a Proprietary Trader (PT)
(Securities Trader (TD)).
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effective date to be January 4, 2016.
Under the proposed rule, associated
persons who have passed the
Proprietary Trader (Series 56)
qualification examination and who have
registered as a Proprietary Trader (PT)
in WebCRD on or before the effective
date of the proposed rule change, and
associated persons who have passed the
General Securities Representative
(Series 7) qualification examination and
who have registered as Proprietary
Traders (PT) in WebCRD on or before
the effective date of the proposed rule
change, would be grandfathered as
Securities Traders (TDs) without having
to take any additional examinations and
without having to take any other action,
provided that the associated person’s
registration has not been revoked by the
Exchange as a disciplinary sanction and
no more than two years have passed
between the date that the associated
person last registered as a Proprietary
Trader (PT) and the effective date. After
the effective date, an associated person
would need to pass the new Series 57
Securities Trader qualification
examination and register as a Securities
Trader (TD).
In addition, associated persons who
have either passed the Proprietary
Trader (PT) qualification examination or
the General Securities Representative
(Series 7) qualification examination and
who have registered as Proprietary
Traders (PT) in WebCRD on or before
the effective date of the proposed rule
change, and who have also passed the
General Securities Principal (Series 24)
qualification examination (or have
completed any of the alternative
acceptable qualifications requirements
as defined in new .08 of Supplementary
Material to Rule 313) and who have also
registered as Proprietary Trader
Principals (TP) in WebCRD on or before
the effective date of the proposed rule
change, would be eligible to register as
Securities Trader Principals (TPs),
provided that the associated person’s
registration has not been revoked by the
Exchange as a disciplinary sanction and
no more than two years have passed
between the date that the associated
person last registered as a Proprietary
Trader Principal (TP) and the date they
register as a Securities Trader Principal
(TP).9 After the effective date, a
Securities Trader Principal (TP) would
need to pass the Securities Trader
(Series 57) qualification examination
and the General Securities Principal
(Series 24) qualification examination (or
have completed any of the alternative
acceptable qualifications as defined in
9 See Rule 313(e) (Requirement for Examination
on Lapse of Registration).
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1247
new .08 of Supplementary Material to
Rule 313) and be registered as such in
order to register as a Securities Trader
Principal (TP).10
Continuing Education Requirements
Persons registered in the new category
would be subject to the continuing
education requirements of Rule 604
Continuing Education for Registered
Persons. The Exchange proposes to
amend Rule 604 by removing the option
for Series 56 registered persons to
participate in the S501 Series 56
Proprietary Trader continuing education
program in order to satisfy the
Regulatory Element. The S501 Series 56
Proprietary Trader continuing education
program is being phased out along with
the Series 56 Proprietary Trader
qualification examination. As a result,
effective January 4, 2016, the S501
Series 56 Proprietary Trader continuing
education program for Series 56
registered persons will cease to exist. In
place of the S501 Series 56 Proprietary
Trader continuing education program
for Series 56 registered persons, the
Exchange proposes that Series 57
registered persons be permitted to enroll
in the S101 General Program for Series
7 and all other registered persons.
Delivery of Regulatory Element
The Exchange further proposes to
provide for Web-based delivery of the
Continuing Education Regulatory
Element for registered persons. As
proposed, Rule 604 would specify that
the Continuing Education Regulatory
Element set forth in the rule will be
administered through Web-based
delivery or such other technological
manner and format as specified by the
Exchange from and after January 4,
2016. Most registered persons currently
complete the Regulatory Element in a
test center and the remainder do so inhouse. Given the advances in Webbased technology, the Exchange believes
that there is diminishing utility in the
test center and in-house Continuing
Education delivery methods. The
Exchange notes that the Web-based
format will include safeguards to
authenticate the identity of the
Continuing Education Candidate.
Moreover, according to FINRA,
registered persons have raised concerns
with the current test center delivery
10 As part of codifying this rule, the Exchange will
include text .08 of Supplementary Material to Rule
313 regarding the supervisory responsibilities of the
Securities Trader Principals, which would limit
Securities Trader Principals’ supervisory
responsibilities to supervision of the securities
trading functions of members as described in
paragraph (a)(2) of .08 of Supplementary Material
to Rule 313, and the activities of officers, partners,
and directors of members.
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method because of the travel involved,
the limited time currently available to
complete a Regulatory Element session,
and the use of rigorous security
measures at test centers, which are
appropriate for taking qualification
examinations, but onerous for a
Continuing Education program.11 Also,
according to FINRA, the test center is
expensive to operate.12
2. Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Act 13 in general, and furthers the
objectives of Section 6(b)(5) of the Act 14
in particular, in that it is designed to
promote just and equitable principles of
trade, to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system, and, in general to protect
investors and the public interest.
The Exchange further believes its
proposed rule change is consistent with
Section 6(c) of the Act,15 and in
particular furthers the objectives of
Section 6(c)(3) of the Act,16 which
authorizes the Exchange to prescribe
standards of training, experience, and
competence for associated persons. The
Exchange believes that the requirements
of the Securities Trader and Securities
Trader Principal registration categories,
the new Securities Trader qualification
and continuing education requirement,
as well as Web-based delivery of the
continuing education requirement,
should help ensure that proprietary
traders and the principals who
supervise proprietary traders and
proprietary trading are, and will
continue to be, properly trained and
qualified to perform their functions
which should protect investors and the
public interest.
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B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act.
Implementation of the proposed
changes to ISE’s registration rules in
coordination with the FINRA
Amendments does not present any
competitive issues, but rather is
designed to provide less burdensome
and more efficient regulatory
compliance for associated persons and
11 See
supra, note 1.
12 Id.
13 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
15 15 U.S.C. 78f(c).
16 15 U.S.C. 78f(c)(3).
enhance the ability of the Exchange to
fairly and efficiently regulate associated
persons, which will further enhance
competition. Additionally, the proposed
rule change should not affect
intramarket competition because all
similarly situated representatives and
principals will be required to complete
the same qualification examinations and
maintain the same registrations. Finally,
the proposed rule change does not
impose any additional examination
burdens on persons who are already
registered. There is no obligation to take
the proposed Series 57 examination in
order to continue in their present duties,
so the proposed rule change is not
expected to disadvantage current
registered persons relative to new
entrants in this regard.
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 this
proposed rule change. The Exchange
has not received any written comments
from members or other interested
parties.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not significantly affect the
protection of investors or the public
interest, does not impose any significant
burden on competition, and, by its
terms, does not 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 17 and Rule 19b–
4(f)(6) thereunder.18 The Exchange
provided the Commission with written
notice of its 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 the proposed
rule change, or such shorter time as
designated by the Commission, as
required by Rule 19b–4(f)(6).
The Exchange has requested that the
Commission waive the thirty-day
operative delay so that the proposal may
become operative as of January 4, 2016.
The Commission believes that waiving
the thirty day delay is consistent with
the protection of investors and the
public interest, as it will enable the
Exchange to have the new requirements
in effect at the same time as the other
14 15
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17 15
18 17
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U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
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SROs. Therefore, the Commission
hereby waives the thirty-day operative
delay and designates the proposal
operative as of January 4, 2016.19
At any time within 60 days of the
filing of such proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form https://www.sec.gov/
rules/sro.shtml); or
• Send an Email to rule-comments@
sec.gov. Please include File No. SR–ISE–
2015–44 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–ISE–2015–44. 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 Commissions
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. Copies of such filing
19 For purposes of waiving the 30-day operative
delay, the Commission has considered the proposed
rule’s impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
E:\FR\FM\11JAN1.SGM
11JAN1
Federal Register / Vol. 81, No. 6 / Monday, January 11, 2016 / Notices
also will be available for inspection and
copying at the principal office of the
ISE. 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–ISE–2015–44 and should be
submitted by February 1, 2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.20
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–248 Filed 1–8–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–76826; File No. SR–
NASDAQ–2015–164]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend Rule
7014
January 5, 2016.
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 December
23, 2015, The NASDAQ Stock Market
LLC (‘‘Nasdaq’’ or ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (‘‘SEC’’ or ‘‘Commission’’)
the proposed rule change as described
in Items I, II, and III below, which Items
have been prepared by the Exchange.
The Commission is publishing this
notice to solicit comments on the
proposed rule change from interested
persons.
mstockstill on DSK4VPTVN1PROD with NOTICES
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is proposing to make
two changes to Rule 7014.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://nasdaq.cchwallstreet.com, at
the principal office of the Exchange, and
at the Commission’s Public Reference
Room.
20 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
VerDate Sep<11>2014
18:17 Jan 08, 2016
Jkt 238001
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 is proposing to make
two changes to Rule 7014. Rule 7014
provides the Exchange’s Market Quality
Incentive Programs. Nasdaq currently
provides the following incentive
programs under the rule: Investor
Support Program, Qualified Market
Maker Program, Lead Market Maker
Program, and NBBO Program. The
Exchange is proposing to add new rule
text concerning what is not considered
eligible displayed liquidity under the
Investor Support Program and to add
clarifying rule text to the NBBO
Program.
First, the Exchange is adding new rule
text to the Investor Support Program
(‘‘ISP’’) under rule 7014(b) to state that
Designated Retail Orders 3 are not
included in the number of shares of
displayed liquidity. The Investor
Support Program enables Nasdaq
member firms to earn a monthly fee
credit for providing displayed liquidity
3 A ‘‘Designated Retail Order’’ is an agency or
riskless principal order that meets the criteria of
FINRA Rule 5320.03 and that originates from a
natural person and is submitted to Nasdaq by a
member that designates it pursuant to Rule 7018,
provided that no change is made to the terms of the
order with respect to price or side of market and
the order does not originate from a trading
algorithm or any other computerized methodology.
An order from a ‘‘natural person’’ can include
orders on behalf of accounts that are held in a
corporate legal form—such as an Individual
Retirement Account, Corporation, or a Limited
Liability Company—that has been established for
the benefit of an individual or group of related
family members, provided that the order is
submitted by an individual. Members must submit
a signed written attestation, in a form prescribed by
Nasdaq, that they have implemented policies and
procedures that are reasonably designed to ensure
that substantially all orders designated by the
member as ‘‘Designated Retail Orders’’ comply with
these requirements. Orders may be designated on an
order-by-order basis, or by designating all orders on
a particular order entry port as Designated Retail
Orders. See Rule 7018.
PO 00000
Frm 00087
Fmt 4703
Sfmt 4703
1249
to Nasdaq. Currently, there are three
rates that a member firm may qualify for
based on the execution price of the
displayed liquidity and whether the
shares of displayed liquidity were
entered through an ISP-designated port.
Subsequent to the adoption of the ISP
Program,4 Nasdaq adopted a new
program under Rule 7018 5 to use
financial incentives to encourage greater
participation. The new program adopted
liquidity provider credit tiers for orders
designated by a member firm as
Designated Retail Orders. Currently,
Nasdaq has a single liquidity provider
credit tier of $0.0034 per share executed
provided for orders designated by a
member firm as Designated Retail
Orders.6 Nasdaq has excluded
Designated Retail Orders from the
calculation of credits available under
the NBBO Program, QMM Program, and
the ISP Program, since those orders
already receive a significant credit
under Rule 7018(a). Similarly, Nasdaq
excludes Designated Retail Orders from
the credits provided for providing
displayed quotes/orders for securities of
all three tapes.7 Unlike the NBBO
Program and QMM Program rules,
which reflect that Designated Retail
Orders are not included in those
programs’ credits, Nasdaq neglected to
amend the ISP Program rules to state
that Designated Retail Orders are not
considered in the calculation of the ISP
credit. In adopting the Designated Retail
Order credit tiers, Nasdaq intended to
also exclude Designated Retail Orders
from the calculation of credits available
under the ISP Program, consistent with
the other programs under the rule. Thus,
Nasdaq is proposing to state in the rule
that Designated Retail Orders are not
included in the number of shares of
displayed liquidity used to calculate
credit received under the ISP Program.
Second, Nasdaq is proposing to add
clarifying rule text to Rule 7014(g),
which concerns the NBBO Program. The
NBBO Program provides rebates per
share executed with respect to all other
displayed orders (other than Designated
Retail Orders) in securities priced at $1
or more per share that provide liquidity
and establish the NBBO. When Nasdaq
adopted the rule, it neglected to note
that the displayed quantity of the NBBO
Program-qualifying order must be at
least one round lot at the time of
execution. An odd lot order of less than
4 See Securities Exchange Act Release No. 63270
(November 8, 2010), 75 FR 69489 (November 12,
2010) (SR–NASDAQ–2010–141).
5 See Securities Exchange Act Release No. 69133
(March 14, 2013), 78 FR 17272 (March 20, 2013)
(SR–NASDAQ–2013–042).
6 See Rule 7018(a).
7 See Rule 7018(a)(1), (2) and (3).
E:\FR\FM\11JAN1.SGM
11JAN1
]]>Agencies
[Federal Register Volume 81, Number 6 (Monday, January 11, 2016)]
[Notices]
[Pages 1245-1249]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-248]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-76835; File No. SR-ISE-2015-44]
Self-Regulatory Organizations; International Securities Exchange;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Establish the Securities Trader and Securities Trader Principal
Registration Categories
January 5, 2016.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\
[[Page 1246]]
notice is hereby given that on December 23, 2015, the International
Securities Exchange, LLC (the ``Exchange'' or the ``ISE'') filed with
the Securities and Exchange Commission the proposed rule change as
described in Items I, II, and III below, of which Items I and II have
been prepared by the self-regulatory organization. The Commission is
publishing this notice to solicit comments on the proposed rule change
from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
ISE proposes to codify, in the Supplementary Material to Rule 313
Registration Requirements, the categories of registration and
respective qualification examinations required for individual
associated persons (``associated persons'') that engage in the
securities activities of members on the Exchange. Specifically, the
Exchange proposes to (1) replace the Proprietary Trader registration
category and the Series 56 Proprietary Trader registration
qualification examination with the newly codified Securities Trader
category of registration and the Series 57 Securities Trader
registration qualification examination for Securities Traders
respectively and (2) replace the Proprietary Trader Principal
registration category with the newly codified registration category of
Securities Trader Principal and require Securities Trader Principals to
take the Series 57 qualification examination in addition to the Series
24 qualification examination. The Exchange also proposes to amend Rule
604, Continuing Education for Registered Persons, by deleting the rule
text referring to the S501 continuing education program currently
applicable to Proprietary Traders and replacing it with the S101, and
replacing a reference to the Series 56 with the 57. Specifically, the
Exchange proposes that Series 57 registered persons take the S101
General Program for Series 7 and all other registered persons. Finally,
the Exchange proposes to amend Rule 604 to provide for Web-based
delivery of the continuing education regulatory element for registered
persons. The text of the proposed rule change is available on the
Exchange's Web site at www.ise.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of 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 amend Rule 313 Registration Requirements.
This amendment will replace the Proprietary Trader (PT) registration
category and qualification examination (Series 56) with the newly
codified Securities Trader (TD) registration category and qualification
examination (Series 57). In addition, the Exchange proposes to replace
the Proprietary Trader Principal (TP) registration category with the
newly codified Securities Trader Principal (TP) registration category
for associated persons who either: (i) Supervise or monitor proprietary
trading, market-making and/or brokerage activities for broker-dealers;
(ii) supervise or train those engaged in proprietary trading, market-
making and/or effecting transactions on behalf of a broker-dealer, with
respect to those activities; and/or (iii) are officers, partners or
directors of a member, as described in paragraph in proposed paragraph
(a) to .08 of Supplementary Material to Rule 313. The Exchange also
proposes to replace the Proprietary Trader Compliance Officer (CT)
registration category with the newly codified Securities Trader
Compliance Officer (CT) registration category for Chief Compliance
Officers (or individuals performing similar functions) of a member or
member organization. This filing is, in all material respects, based
upon SR-FINRA-2015-015 and 2015-017, and SR-C2-2015-027.\3\
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 75581 (July 31,
2015), 80 FR 47018 (August 6, 2015) (SR-FINRA-2015-015); Securities
Exchange Act Release No. 75783 (August 28, 2015), 80 FR 53369
(September 3, 2015) (SR-FINRA-2015-017); and Securities Exchange Act
Release No. 76408 (November 10, 2015) (SR-C2-2015-027).
---------------------------------------------------------------------------
Currently, Rule 313 requires, among other things, an associated
person engaged or to be engaged in the securities business of a member
to register with the Exchange in the category of registration
appropriate to the function to be performed and to pass the
qualification examination appropriate to the category of registration
as prescribed by the Exchange. Among the qualification and registration
requirements set forth by the Exchange, an associated person who
engages in proprietary trading, market-making, or effecting
transactions on behalf of a broker-dealer must register and qualify as
a Proprietary Trader (PT) in WebCRD.\4\ To qualify as a Proprietary
Trader, an associated person must either pass the Series 56 Proprietary
Trader qualification examination \5\ or Series 7 General Securities
Representative qualification examination. Several exchanges, including
ISE currently use the Series 56 examination as a qualification
standard.\6\
---------------------------------------------------------------------------
\4\ WebCRD is a secure registration and licensing system
operated by FINRA and is the central licensing and registration
system for the U.S. securities industry and its regulators. The
system contains the registration records of more than 6,500
registered broker-dealers, and the qualification, employment and
disclosure histories of more than 650,000 active registered
associated persons. In addition, Web CRD facilitates the processing
and payment of FINRA registration-related fees such as form filings,
fingerprint submissions, qualification exams and continuing
education sessions.
\5\ The Series 56 Proprietary Trader Examination is a two hour
and thirty minute exam, consisting of 100 scored multiple-choice
questions. The Series 56 examination is administered by FINRA, but
is not recognized by FINRA as an acceptable qualification
examination for associated persons engaged in securities trading.
Under FINRA rules, associated persons of FINRA members that engage
in over-the-counter securities trading are required to pass the
Series 55 Equity Trader Exam. Nevertheless, as FINRA has recognized,
because the Series 55 and Series 56 are intended to test the core
knowledge required of associated persons engaged in trading
activities as well as self-regulatory organization (``SRO'') rules,
including trading rules that are common across all SROs, there is
significant overlap in the content of the Series 55 and Series 56
qualification examinations. See Securities Exchange Act Release No.
75394 (July 8, 2015), 80 FR 41119 (Notice of Filing of a Proposed
Rule Change to Establish the Securities Trader and Securities Trader
Principal Registration Categories) (SR-FINRA-2015-017).
\6\ See, e.g., BATS Exchange, Inc. (``BATS'') Interpretation and
Policy .01 to Rule 2.5 (Proficiency Examinations); Miami
International Securities Exchange, LLC (``MIAX'') Rule 1302
(Registration of Representatives).
---------------------------------------------------------------------------
.07 of Supplementary Material to Rule 313 further requires that an
associated person with supervisory responsibility over proprietary
trading activities or who is an (i) officer; (ii) partner; (iii)
director; (iv) supervisor of proprietary trading, market-making or
brokerage activities; and/or (v) supervisor of those engaged in
proprietary trading, market-making or brokerage activities with respect
to those activities is required to register and qualify as a
Proprietary Trader Principal (TP) in WebCRD and satisfy prerequisite
registration and qualification requirements, including, but not limited
to passing the Series 24 General Securities Principal
[[Page 1247]]
Examination or an acceptable alternative qualification examination. An
associated person who is a Chief Compliance Officer (or performs
similar functions) for a member that engages in proprietary trading,
market-making, or effecting transactions on behalf of a broker-dealer
is also required to register and qualify as a Proprietary Trader
Compliance Officer (CT) in WebCRD and satisfy the prerequisite
registration and qualification requirements, including, but not limited
to passing the Series 14 Compliance Official Examination or an
acceptable alternative qualification exam.
Codification of Examination and Registration Requirements
The Exchange proposes to replace the Series 56 qualification
examination with the newly codified Series 57 qualification examination
for those registration categories where the Series 56 is currently an
acceptable qualification standard. Specifically, with respect to the
Proprietary Trader registration, the Exchange proposes to replace the
Proprietary Trader (PT) registration category with the newly codified
Securities Trader (TD) registration category as well as eliminate the
current Series 56 Proprietary Trader Exam prerequisite and, instead,
include a Series 57 Securities Trader qualification examination in its
place.\7\ The Proprietary Trader Principal (PT) and Proprietary Trader
Compliance Officer (CT) registration categories would be replaced with
the newly codified renamed registration categories of Securities Trader
Principal (TP) and Securities Trader Compliance Officer respectively
(CT).\8\
---------------------------------------------------------------------------
\7\ Neither the Exchange's current Rules nor the proposal would
require that a Proprietary Trader or Securities Trader work at, or
be associated with, a ``proprietary trading firm.'' Rather, both the
current Rules and the proposal would require that an associated
person that engages in proprietary trading, market-making, or
effecting transactions on behalf of a broker-dealer qualify and
register as a Proprietary Trader (or Securities Trader) in WebCRD.
Whereas the current rule allows an associated person to qualify and
register as a Proprietary Trader by either passing the Series 56
Proprietary Trader qualification examination or Series 7 General
Securities Representative qualification examination, the proposal
would require an associated person to pass the Series 57 Securities
Trader qualification examination in order to qualify as a Securities
Trader after the effective date of the proposal.
\8\ As is the case under the current Rules, under the proposed
rule, only individuals qualified and registered as a Proprietary
Trader Principal (TP) (Securities Trader Principal TP)) would be
permitted to supervise a Proprietary Trader (PT) (Securities Trader
(TD)).
---------------------------------------------------------------------------
The Exchange will announce the effective date of the proposed rule
change in a Regulatory Circular. Currently, the Exchange intends for
the effective date to be January 4, 2016. Under the proposed rule,
associated persons who have passed the Proprietary Trader (Series 56)
qualification examination and who have registered as a Proprietary
Trader (PT) in WebCRD on or before the effective date of the proposed
rule change, and associated persons who have passed the General
Securities Representative (Series 7) qualification examination and who
have registered as Proprietary Traders (PT) in WebCRD on or before the
effective date of the proposed rule change, would be grandfathered as
Securities Traders (TDs) without having to take any additional
examinations and without having to take any other action, provided that
the associated person's registration has not been revoked by the
Exchange as a disciplinary sanction and no more than two years have
passed between the date that the associated person last registered as a
Proprietary Trader (PT) and the effective date. After the effective
date, an associated person would need to pass the new Series 57
Securities Trader qualification examination and register as a
Securities Trader (TD).
In addition, associated persons who have either passed the
Proprietary Trader (PT) qualification examination or the General
Securities Representative (Series 7) qualification examination and who
have registered as Proprietary Traders (PT) in WebCRD on or before the
effective date of the proposed rule change, and who have also passed
the General Securities Principal (Series 24) qualification examination
(or have completed any of the alternative acceptable qualifications
requirements as defined in new .08 of Supplementary Material to Rule
313) and who have also registered as Proprietary Trader Principals (TP)
in WebCRD on or before the effective date of the proposed rule change,
would be eligible to register as Securities Trader Principals (TPs),
provided that the associated person's registration has not been revoked
by the Exchange as a disciplinary sanction and no more than two years
have passed between the date that the associated person last registered
as a Proprietary Trader Principal (TP) and the date they register as a
Securities Trader Principal (TP).\9\ After the effective date, a
Securities Trader Principal (TP) would need to pass the Securities
Trader (Series 57) qualification examination and the General Securities
Principal (Series 24) qualification examination (or have completed any
of the alternative acceptable qualifications as defined in new .08 of
Supplementary Material to Rule 313) and be registered as such in order
to register as a Securities Trader Principal (TP).\10\
---------------------------------------------------------------------------
\9\ See Rule 313(e) (Requirement for Examination on Lapse of
Registration).
\10\ As part of codifying this rule, the Exchange will include
text .08 of Supplementary Material to Rule 313 regarding the
supervisory responsibilities of the Securities Trader Principals,
which would limit Securities Trader Principals' supervisory
responsibilities to supervision of the securities trading functions
of members as described in paragraph (a)(2) of .08 of Supplementary
Material to Rule 313, and the activities of officers, partners, and
directors of members.
---------------------------------------------------------------------------
Continuing Education Requirements
Persons registered in the new category would be subject to the
continuing education requirements of Rule 604 Continuing Education for
Registered Persons. The Exchange proposes to amend Rule 604 by removing
the option for Series 56 registered persons to participate in the S501
Series 56 Proprietary Trader continuing education program in order to
satisfy the Regulatory Element. The S501 Series 56 Proprietary Trader
continuing education program is being phased out along with the Series
56 Proprietary Trader qualification examination. As a result, effective
January 4, 2016, the S501 Series 56 Proprietary Trader continuing
education program for Series 56 registered persons will cease to exist.
In place of the S501 Series 56 Proprietary Trader continuing education
program for Series 56 registered persons, the Exchange proposes that
Series 57 registered persons be permitted to enroll in the S101 General
Program for Series 7 and all other registered persons.
Delivery of Regulatory Element
The Exchange further proposes to provide for Web-based delivery of
the Continuing Education Regulatory Element for registered persons. As
proposed, Rule 604 would specify that the Continuing Education
Regulatory Element set forth in the rule will be administered through
Web-based delivery or such other technological manner and format as
specified by the Exchange from and after January 4, 2016. Most
registered persons currently complete the Regulatory Element in a test
center and the remainder do so in-house. Given the advances in Web-
based technology, the Exchange believes that there is diminishing
utility in the test center and in-house Continuing Education delivery
methods. The Exchange notes that the Web-based format will include
safeguards to authenticate the identity of the Continuing Education
Candidate. Moreover, according to FINRA, registered persons have raised
concerns with the current test center delivery
[[Page 1248]]
method because of the travel involved, the limited time currently
available to complete a Regulatory Element session, and the use of
rigorous security measures at test centers, which are appropriate for
taking qualification examinations, but onerous for a Continuing
Education program.\11\ Also, according to FINRA, the test center is
expensive to operate.\12\
---------------------------------------------------------------------------
\11\ See supra, note 1.
\12\ Id.
---------------------------------------------------------------------------
2. Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act \13\ in general, and furthers the objectives of Section
6(b)(5) of the Act \14\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest.
---------------------------------------------------------------------------
\13\ 15 U.S.C. 78f(b).
\14\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange further believes its proposed rule change is
consistent with Section 6(c) of the Act,\15\ and in particular furthers
the objectives of Section 6(c)(3) of the Act,\16\ which authorizes the
Exchange to prescribe standards of training, experience, and competence
for associated persons. The Exchange believes that the requirements of
the Securities Trader and Securities Trader Principal registration
categories, the new Securities Trader qualification and continuing
education requirement, as well as Web-based delivery of the continuing
education requirement, should help ensure that proprietary traders and
the principals who supervise proprietary traders and proprietary
trading are, and will continue to be, properly trained and qualified to
perform their functions which should protect investors and the public
interest.
---------------------------------------------------------------------------
\15\ 15 U.S.C. 78f(c).
\16\ 15 U.S.C. 78f(c)(3).
---------------------------------------------------------------------------
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 not necessary or appropriate in
furtherance of the purposes of the Act. Implementation of the proposed
changes to ISE's registration rules in coordination with the FINRA
Amendments does not present any competitive issues, but rather is
designed to provide less burdensome and more efficient regulatory
compliance for associated persons and enhance the ability of the
Exchange to fairly and efficiently regulate associated persons, which
will further enhance competition. Additionally, the proposed rule
change should not affect intramarket competition because all similarly
situated representatives and principals will be required to complete
the same qualification examinations and maintain the same
registrations. Finally, the proposed rule change does not impose any
additional examination burdens on persons who are already registered.
There is no obligation to take the proposed Series 57 examination in
order to continue in their present duties, so the proposed rule change
is not expected to disadvantage current registered persons relative to
new entrants in this regard.
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
this proposed rule change. The Exchange has not received any written
comments from members or other interested parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not significantly
affect the protection of investors or the public interest, does not
impose any significant burden on competition, and, by its terms, does
not 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 \17\ and Rule 19b-
4(f)(6) thereunder.\18\ The Exchange provided the Commission with
written notice of its 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 the proposed rule
change, or such shorter time as designated by the Commission, as
required by Rule 19b-4(f)(6).
---------------------------------------------------------------------------
\17\ 15 U.S.C. 78s(b)(3)(A).
\18\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
The Exchange has requested that the Commission waive the thirty-day
operative delay so that the proposal may become operative as of January
4, 2016. The Commission believes that waiving the thirty day delay is
consistent with the protection of investors and the public interest, as
it will enable the Exchange to have the new requirements in effect at
the same time as the other SROs. Therefore, the Commission hereby
waives the thirty-day operative delay and designates the proposal
operative as of January 4, 2016.\19\
---------------------------------------------------------------------------
\19\ For purposes of waiving the 30-day operative delay, the
Commission has considered the proposed rule's impact on efficiency,
competition, and capital formation. See 15 U.S.C. 78c(f).
---------------------------------------------------------------------------
At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form https://www.sec.gov/rules/sro.shtml); or
Send an Email to rule-comments@sec.gov. Please include
File No. SR-ISE-2015-44 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-ISE-2015-44. 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 Commissions 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. Copies of such filing
[[Page 1249]]
also will be available for inspection and copying at the principal
office of the ISE. 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-ISE-
2015-44 and should be submitted by February 1, 2016.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\20\
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\20\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-248 Filed 1-8-16; 8:45 am]
BILLING CODE 8011-01-P
