Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Delay of Implementation of Kill Switch, 1266-1268 [2016-252]
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1266
Federal Register / Vol. 81, No. 6 / Monday, January 11, 2016 / Notices
4(f)(6) thereunder.16 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
SROs. Therefore, the Commission
hereby waives the thirty-day operative
delay and designates the proposal
operative as of January 4, 2016.17
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.
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
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 Gemini-2015–28 and
should be submitted by February 1,
2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–247 Filed 1–8–16; 8:45 am]
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
Gemini–2015–28 on the subject line.
mstockstill on DSK4VPTVN1PROD with NOTICES
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Delay of
Implementation of Kill Switch
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 Gemini–2015–28. This
file number should be included on the
subject line if email is used. To help the
16 17
CFR 240.19b–4(f)(6).
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).
17 For
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–76830; File No. SR–
NASDAQ–2015–163]
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 and II below, which Items
have been prepared by the Exchange.
The Commission is publishing this
18 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
Frm 00104
Fmt 4703
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to extend the
implementation timeframe for adopting
an optional Kill Switch protection.
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.
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
BILLING CODE 8011–01–P
PO 00000
notice to solicit comments on the
proposed rule change from interested
persons.
Sfmt 4703
The purpose of the proposal is to
extend the implementation of the
timeframe to adopt a new risk
protection, a Kill Switch, applicable to
all NOM Participants. In its rule change
adopting this new risk protection in
Chapter VI, Section 6, the Exchange
stated, ‘‘The Exchange proposes to
implement this rule within ninety (90)
days of the implementation date.’’ 3 The
Exchange stated that it will issue an
Options Trader Alert in advance to
inform market participants of such date.
At this time, the Exchange desires to
extend the implementation of this rule
change to 120 days from the operative
date. The Exchange will announce the
date of implementation by issuing an
Options Trader Alert.
By way of background, the Kill
Switch will allow NOM Participants to
remove quotes and cancel open orders
and prevent new order submission. The
NASDAQ Options Kill Switch will be
an optional tool that enables
3 See Securities Exchange Act Release No. 75743
(August 20, 2015), 80 FR 51850 (August 26, 2015)
(SR–NASDAQ–2015–096).
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mstockstill on DSK4VPTVN1PROD with NOTICES
Participants to initiate a message(s) 4 to
the System to: (i) Promptly remove
quotes; and/or (ii) promptly cancel
orders. Participants may submit a
request to the System to remove/cancel
quotes and/or orders based on certain
identifiers on either a user or group
level. Participants may elect to remove
quotes and cancel orders by Exchange
account, port, and/or badge or
mnemonic (‘‘Identifier’’) or by a group
(one or more Identifier combinations),5
which are provided by such Participant
to the Exchange.6 Participants may not
remove quotes/orders by symbol. The
System will send an automated message
to the Participant when a Kill Switch
request has been processed by the
Exchange’s System.
If the Participant selects quotes to be
cancelled utilizing the Kill Switch, the
NOM Participant must send a message
to the Exchange to request the removal
of all quotes requested for the certain
specified Identifier(s). The NOM
Participant will be unable to enter any
additional quotes for the affected
Identifier(s) until re-entry has been
enabled pursuant to proposed section
(d)(iii).7 If the Participant selects orders
to be cancelled utilizing the Kill Switch,
the NOM Participant must send a
message to the Exchange to request the
cancellation of all orders requested for
the certain specified Identifier(s). The
NOM Participant will be unable to enter
additional orders for the affected
Identifier(s) until re-entry has been
enabled pursuant to section (d)(iii). The
NOM Participant will be unable to enter
additional quotes and/or orders for the
affected Identifier(s) until the NOM
Participant has made a request to the
Exchange and Exchange staff has set a
re-entry indicator to enable re-entry.8
Once enabled for re-entry, the System
will send a Re-entry Notification
Message to the NOM Participant. The
applicable Clearing Participant for that
NOM Participant also will be notified of
the re-entry into the System after quotes
and/or orders are removed/cancelled as
a result of the Kill Switch, provided the
4 NOM Participants will be able to utilize an
interface to send a message to the Exchange to
initiate the Kill Switch or they may contact the
Exchange directly.
5 The type of group permissible would be within
a broker-dealer. For example, this could be
including but not limited to all market maker
accounts or all order entry ports.
6 Orders submitted by NOM Market Makers over
Ouch to Trade Options (OTTO) interface will be
treated as quotes for purposes of this rule.
7 Sweeps will also be cancelled. A sweep is a onesided electronic quote submitted over the
Specialized Quote Feed, which is the market
making quoting interface.
8 The NOM Participant must directly and verbally
contact the Exchange to request the re-set.
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Clearing Participant has requested to
receive such notification.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Act 9 in general, and furthers the
objectives of Section 6(b)(5) of the Act 10
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, by
enhancing the risk protections available
to Exchange members. The proposal
promotes policy goals of the
Commission which has encouraged
execution venues, exchange and nonexchange alike, to enhance risk
protection tools and other mechanisms
to decrease risk and increase stability.
The delay of the implementation of
NOM Rules at Chapter VI, Section 6 will
permit the Exchange an additional thirty
days within which to implement this
risk protection that will be utilized by
NOM Participants.
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. The proposal
does not impose an undue burden on
inter-market competition because all
NOM Participants may avail themselves
of the Kill Switch, which functionality
will be optional. The proposed rule
change is meant to protect NOM
Participants in the event the NOM
Participant is suffering from a systems
issue or from the occurrence of unusual
or unexpected market activity that
would require them to withdraw from
the market in order to protect investors.
The ability to control risk at either the
user or group level will permit the NOM
Participant to protect itself from
inadvertent exposure to excessive risk at
the each level. Reducing such risk will
enable NOM Participants to enter quotes
and orders without any fear of
inadvertent exposure to excessive risk,
which in turn will benefit investors
through increased liquidity for the
execution of their orders. Such
increased liquidity benefits investors
because they receive better prices and
because it lowers volatility in the
options market. For these reasons, the
Exchange does not believe this proposal
imposes an undue burden on inter9 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
market competition, rather, the
proposed rule change will have no
impact on competition.
The delay of the implementation of
NOM Rules at Chapter VII, Section 6(f)
will permit the Exchange additional
time to implement this risk protection
that will be utilized by NOM
Participants.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
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 if
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 11 and Rule 19b–4(f)(6)
thereunder.12
Nasdaq requested that the
Commission waive the 30-day operative
delay. The Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest,
because the extension will provide the
Exchange with the additional time it
requires to implement the Kill Switch
program. The Commission further notes
that Nasdaq’s proposal to adopt the Kill
Switch 13 was approved by the
Commission 14 and that the extension of
the implementation period does not
affect the parameters of the Kill Switch
program. For these reasons, the
Commission designates the proposed
rule change to be operative upon
filing.15
11 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
change, or such shorter time as designated by the
Commission. The Exchange has satisfied this
requirement.
13 See note 3.
14 See Securities Exchange Act Release No. 76123
(Oct. 9, 2015), 80 FR 62591 (Oct. 16, 2015) (SR–
NASDAQ–2015–096).
15 For purposes only of waiving the 30-day
operative delay, the Commission has also
considered the proposed rule’s impact on
12 17
10 15
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1268
Federal Register / Vol. 81, No. 6 / Monday, January 11, 2016 / Notices
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.
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:
mstockstill on DSK4VPTVN1PROD with NOTICES
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rulecomments@sec.gov. Please include File
Number SR–NASDAQ–2015–163 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–NASDAQ–2015–163. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–
NASDAQ–2015–163 and should be
submitted on or before February 1, 2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–252 Filed 1–8–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–76828; File No. SR–CBOE–
2015–115]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Relating to Fees for
Certain CBOE Real-Time Data Feeds
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
22, 2015, Chicago Board Options
Exchange, Incorporated (the ‘‘Exchange’’
or ‘‘CBOE’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
prepared by the Exchange. 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
Chicago Board Options Exchange,
Incorporated (the ‘‘Exchange’’ or
‘‘CBOE’’) proposes to amend fees for
certain CBOE real-time data feeds. The
text of the proposed rule change is
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.
16 17
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
VerDate Sep<11>2014
18:17 Jan 08, 2016
Jkt 238001
CFR 200.30–3(a)(12) and (59).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
PO 00000
Frm 00106
Fmt 4703
Sfmt 4703
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 purpose of the proposed rule
change is to amend fees for the BBO
Data Feed and Book Depth Data Feed.
These data feeds are made available by
CBOE’s affiliate Market Data Express,
LLC (‘‘MDX’’).3
BBO and Book Depth Data Feeds
BBO Data Feed: The BBO Data Feed
is a real-time, low latency data feed that
includes the following content: (i)
Outstanding quotes and standing orders
at the best available price level on each
side of the market, with aggregate size
(‘‘BBO data’’), and last sale data; 4 (ii)
totals of customer versus non-customer
contracts at the BBO, (iii) All-or-None
contingency orders priced better than or
equal to the BBO, (iv) BBO and last sale
data for complex strategies (e.g.,
spreads, straddles, buy-writes, etc.); (v)
expected opening price (‘‘EOP’’) and
expected opening size (‘‘EOS’’)
information that is disseminated prior to
the opening of the market and during
trading rotations, (vi) end-of-day
(‘‘EOD’’) summary messages that are
disseminated after the close of a trading
session that include summary
3 MDX also offers real-time Complex Order Book
(‘‘COB’’) and Flexible Exchange (‘‘FLEX’’) Options
Data Feeds. The COB Data Feed includes data
regarding the Exchange’s Complex Order Book and
related complex order information. The COB Data
Feed includes BBO, Book Depth and last sale data
for all CBOE-traded complex order strategies and
identifies customer orders and trades. The
Exchange is not proposing to amend fees for the
COB Data Feed at this time. The FLEX Options Data
Feed includes BBO and last sale data for FLEX
options traded on the CBOE FLEX Hybrid Trading
System, including BBO and last sale data for FLEX
complex strategies. The FLEX Options Data Feed is
currently made available at no charge. The
Exchange is not proposing to establish fees for the
FLEX Options Data Feed at this time.
4 ‘‘Best bid and offer’’ or ‘‘BBO’’ data is sometimes
referred to as ‘‘top-of-book’’ data. Data with respect
to executed trades is referred to as ‘‘last sale’’ data.
E:\FR\FM\11JAN1.SGM
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Agencies
[Federal Register Volume 81, Number 6 (Monday, January 11, 2016)]
[Notices]
[Pages 1266-1268]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-252]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-76830; File No. SR-NASDAQ-2015-163]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Delay of Implementation of Kill Switch
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 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.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to extend the implementation timeframe for
adopting an optional Kill Switch protection.
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.
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 purpose of the proposal is to extend the implementation of the
timeframe to adopt a new risk protection, a Kill Switch, applicable to
all NOM Participants. In its rule change adopting this new risk
protection in Chapter VI, Section 6, the Exchange stated, ``The
Exchange proposes to implement this rule within ninety (90) days of the
implementation date.'' \3\ The Exchange stated that it will issue an
Options Trader Alert in advance to inform market participants of such
date. At this time, the Exchange desires to extend the implementation
of this rule change to 120 days from the operative date. The Exchange
will announce the date of implementation by issuing an Options Trader
Alert.
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 75743 (August 20,
2015), 80 FR 51850 (August 26, 2015) (SR-NASDAQ-2015-096).
---------------------------------------------------------------------------
By way of background, the Kill Switch will allow NOM Participants
to remove quotes and cancel open orders and prevent new order
submission. The NASDAQ Options Kill Switch will be an optional tool
that enables
[[Page 1267]]
Participants to initiate a message(s) \4\ to the System to: (i)
Promptly remove quotes; and/or (ii) promptly cancel orders.
Participants may submit a request to the System to remove/cancel quotes
and/or orders based on certain identifiers on either a user or group
level. Participants may elect to remove quotes and cancel orders by
Exchange account, port, and/or badge or mnemonic (``Identifier'') or by
a group (one or more Identifier combinations),\5\ which are provided by
such Participant to the Exchange.\6\ Participants may not remove
quotes/orders by symbol. The System will send an automated message to
the Participant when a Kill Switch request has been processed by the
Exchange's System.
---------------------------------------------------------------------------
\4\ NOM Participants will be able to utilize an interface to
send a message to the Exchange to initiate the Kill Switch or they
may contact the Exchange directly.
\5\ The type of group permissible would be within a broker-
dealer. For example, this could be including but not limited to all
market maker accounts or all order entry ports.
\6\ Orders submitted by NOM Market Makers over Ouch to Trade
Options (OTTO) interface will be treated as quotes for purposes of
this rule.
---------------------------------------------------------------------------
If the Participant selects quotes to be cancelled utilizing the
Kill Switch, the NOM Participant must send a message to the Exchange to
request the removal of all quotes requested for the certain specified
Identifier(s). The NOM Participant will be unable to enter any
additional quotes for the affected Identifier(s) until re-entry has
been enabled pursuant to proposed section (d)(iii).\7\ If the
Participant selects orders to be cancelled utilizing the Kill Switch,
the NOM Participant must send a message to the Exchange to request the
cancellation of all orders requested for the certain specified
Identifier(s). The NOM Participant will be unable to enter additional
orders for the affected Identifier(s) until re-entry has been enabled
pursuant to section (d)(iii). The NOM Participant will be unable to
enter additional quotes and/or orders for the affected Identifier(s)
until the NOM Participant has made a request to the Exchange and
Exchange staff has set a re-entry indicator to enable re-entry.\8\ Once
enabled for re-entry, the System will send a Re-entry Notification
Message to the NOM Participant. The applicable Clearing Participant for
that NOM Participant also will be notified of the re-entry into the
System after quotes and/or orders are removed/cancelled as a result of
the Kill Switch, provided the Clearing Participant has requested to
receive such notification.
---------------------------------------------------------------------------
\7\ Sweeps will also be cancelled. A sweep is a one-sided
electronic quote submitted over the Specialized Quote Feed, which is
the market making quoting interface.
\8\ The NOM Participant must directly and verbally contact the
Exchange to request the re-set.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act \9\ in general, and furthers the objectives of Section
6(b)(5) of the Act \10\ 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, by enhancing the risk protections available to Exchange
members. The proposal promotes policy goals of the Commission which has
encouraged execution venues, exchange and non-exchange alike, to
enhance risk protection tools and other mechanisms to decrease risk and
increase stability.
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The delay of the implementation of NOM Rules at Chapter VI, Section
6 will permit the Exchange an additional thirty days within which to
implement this risk protection that will be utilized by NOM
Participants.
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. The proposal does not impose an
undue burden on inter-market competition because all NOM Participants
may avail themselves of the Kill Switch, which functionality will be
optional. The proposed rule change is meant to protect NOM Participants
in the event the NOM Participant is suffering from a systems issue or
from the occurrence of unusual or unexpected market activity that would
require them to withdraw from the market in order to protect investors.
The ability to control risk at either the user or group level will
permit the NOM Participant to protect itself from inadvertent exposure
to excessive risk at the each level. Reducing such risk will enable NOM
Participants to enter quotes and orders without any fear of inadvertent
exposure to excessive risk, which in turn will benefit investors
through increased liquidity for the execution of their orders. Such
increased liquidity benefits investors because they receive better
prices and because it lowers volatility in the options market. For
these reasons, the Exchange does not believe this proposal imposes an
undue burden on inter-market competition, rather, the proposed rule
change will have no impact on competition.
The delay of the implementation of NOM Rules at Chapter VII,
Section 6(f) will permit the Exchange additional time to implement this
risk protection that will be utilized by NOM Participants.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
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 if consistent with the protection of investors
and the public interest, the proposed rule change has become effective
pursuant to Section 19(b)(3)(A) of the Act \11\ and Rule 19b-4(f)(6)
thereunder.\12\
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\11\ 15 U.S.C. 78s(b)(3)(A).
\12\ 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 shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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Nasdaq requested that the Commission waive the 30-day operative
delay. The Commission believes that waiving the 30-day operative delay
is consistent with the protection of investors and the public interest,
because the extension will provide the Exchange with the additional
time it requires to implement the Kill Switch program. The Commission
further notes that Nasdaq's proposal to adopt the Kill Switch \13\ was
approved by the Commission \14\ and that the extension of the
implementation period does not affect the parameters of the Kill Switch
program. For these reasons, the Commission designates the proposed rule
change to be operative upon filing.\15\
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\13\ See note 3.
\14\ See Securities Exchange Act Release No. 76123 (Oct. 9,
2015), 80 FR 62591 (Oct. 16, 2015) (SR-NASDAQ-2015-096).
\15\ For 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).
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[[Page 1268]]
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.
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-NASDAQ-2015-163 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-NASDAQ-2015-163. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NASDAQ-2015-163 and should
be submitted on or before February 1, 2016.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12) and (59).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-252 Filed 1-8-16; 8:45 am]
BILLING CODE 8011-01-P