Self-Regulatory Organizations; Bats BYX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 11.13, Order Execution and Routing, To Delete the IOCM and ICMT Routing Options, 30360-30362 [2016-11401]

Download as PDF 30360 Federal Register / Vol. 81, No. 94 / Monday, May 16, 2016 / Notices For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.69 Robert W. Errett, Deputy Secretary. [FR Doc. 2016–11405 Filed 5–13–16; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–77790; File No. SR– BatsBYX–2016–06] Self-Regulatory Organizations; Bats BYX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 11.13, Order Execution and Routing, To Delete the IOCM and ICMT Routing Options May 10, 2016. Pursuant to the provisions of 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 May 2, 2016, Bats BYX Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BYX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange has designated this proposal as a ‘‘non-controversial’’ proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f)(6)(iii) thereunder,4 which renders it effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. asabaliauskas on DSK3SPTVN1PROD with NOTICES I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to amend Rule 11.13, Order Execution and Routing, to delete the IOCM and ICMT routing options. The Exchange also proposes to amend its fee schedule to delete: (i) References to the IOCM and ICMT routing options under footnote 8; and (ii) fee code PX, which is yielded on orders routed using the RMPT routing option or routed to Bats EDGX Exchange, Inc. (‘‘EDGX’’) to execute against MidPoint Peg Orders 5 on EDGX using ICMT or IOCM routing options. 69 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(6)(iii). 5 See EDGX Rule 11.8(d). The BYX fee schedule uses the term ‘‘EDGX MPM’’ for fee code PX. EDGX MPM is intended to refer to contra side MidPoint Peg Orders on EDGX. 1 15 VerDate Sep<11>2014 18:48 May 13, 2016 Jkt 238001 The text of the proposed rule change is available at the Exchange’s Web site at www.batstrading.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Rule 11.13, Order Execution and Routing, to delete the IOCM and ICMT routing options. The Exchange also proposes to amend its fee schedule to delete: (i) References to the IOCM and ICMT routing options under footnote 8; and (ii) fee code PX, which is yielded on orders routed using the RMPT routing option or routed to EDGX to execute against MidPoint Peg Orders on EDGX using ICMT or IOCM routing options. Under Rule 11.13(b)(3)(O), an order utilizing the IOCM routing option checks the System 6 for available shares and then is sent, as MidPoint Peg Order with a Time-in-Force of IOC, to EDGX. Under Rule 11.13(b)(3)(P), an order utilizing the ICMT routing option checks the System for available shares, then is sent to destinations on the System routing table and then is sent, as MidPoint Peg Order with a Time-inForce of IOC, to EDGX. If shares remain unexecuted after routing pursuant to both the IOCM and ICMT routing options, they are posted on the book, unless otherwise instructed by the User.7 6 The ‘‘System’’ is the Exchange’s electronic communications and trading facility designated by the Board through which securities orders of Users are consolidated for ranking, execution and, when applicable, routing away. See Exchange Rule 1.5(aa). 7 The term ‘‘User’’ is defined as ‘‘any Member or Sponsored Participant who is authorized to obtain access to the System pursuant to Rule 11.3.’’ See Exchange Rule 1.5(cc). PO 00000 Frm 00124 Fmt 4703 Sfmt 4703 Footnote 8 of the fee schedule states that orders in securities priced below $1.00 that remove liquidity utilizing certain routing strategies, including IOCM and ICMT are charged a fee of $0.29% of the trade’s total dollar value. Fee code PX is yielded on orders routed using the RMPT routing option or routed to EDGX to execute against MidPoint Peg Orders on EDGX using ICMT or IOCM routing options. Orders that yield fee code PX pay a fee of $0.0012 per share in securities priced at or above $1.00 and 0.29% of the trade’s dollar value for securities priced below $1.00. Because few Users elect the IOCM or ICMT routing options, the Exchange has determined that the current demand does not warrant the infrastructure and ongoing maintenance expenses required to support the products. Therefore, the Exchange proposes to delete the IOCM and ICMT routing options under Rule 11.13(b)(3)(O) and (P) as well as a reference to the IOCM and ICMT routing options under Rule 11.13(b)(3)(H). The Exchange also proposes to amend its fee schedule to delete: (i) References to the IOCM and ICMT routing options under footnote 8; and (ii) fee code PX, which is yielded on orders routed using the RMPT routing option or routed to EDGX to execute against MidPoint Peg Orders on EDGX using ICMT or IOCM routing options. Users seeking to route midpoint eligible orders to EDGX may use alternative methods, such as connecting to EDGX directly or through a third party service provider, or electing another routing option offered by the Exchange that enables a User to post an order to certain primary listing markets.8 The Exchange intends to implement the proposed rule change on May 5, 2016.9 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act 10 in general, and furthers the objectives of Section 6(b)(5) of the Act 11 in particular, in that it is designed to promote just and equitable principles of 8 See e.g., Rule 11.13(b)(3)(Q) (describing the RMPT routing option under which a Mid-Point Peg Order checks the System for available shares and any remaining shares are then sent to destinations on the System routing table that support midpoint eligible orders. If any shares remain unexecuted after routing, they are posted on the BYX book as a MidPoint Peg Order, unless otherwise instructed by the User). 9 See Bats to Decommission ICMT, IOCM, and TRIM3 Routing Strategies, issued April 18, 2016, available at https://cdn.batstrading.com/resources/ release_notes/2016/Bats-to-Decommission-ICMTIOCM-and-TRIM3-Routing-Strategies.pdf. 10 15 U.S.C. 78f(b). 11 15 U.S.C. 78f(b)(5). E:\FR\FM\16MYN1.SGM 16MYN1 Federal Register / Vol. 81, No. 94 / Monday, May 16, 2016 / Notices trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system and, in general, to protect investors and the public interest. The Exchange does not believe that this proposal will permit unfair discrimination among customers, brokers, or dealers because the IOCM and ICMT routing options will no longer be available to all Users. The Exchange has few Users electing the IOCM and ICMT routing options and has determined that the current demand does not warrant the infrastructure and ongoing maintenance expense required to support the products. Routing through the Exchange is voluntary and alternative routing options offered by the Exchange as well as other methods remain available to Users that wish to route midpoint eligible orders to EDGX.12 In addition, the IOCM and ICMT routing options are not core product offerings by the Exchange, nor is the Exchange required by the Act to offer such products. Therefore, the Exchange believes the proposed rule change would make its rules clearer and less confusing for investors by removing routing options that will no longer be offered by the Exchange; thereby removing impediments to and perfecting the mechanism of a free and open market and a national market system, and, in general, protecting investors and the public interest. asabaliauskas on DSK3SPTVN1PROD with NOTICES B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposal will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change is not designed to address any competitive issues but rather avoid investor confusion by eliminating the IOCM and ICMT routing options that are to be discontinued by the Exchange. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has neither solicited nor received written comments on the proposed rule change. 13 15 supra note 8 and accompanying text. VerDate Sep<11>2014 18:48 May 13, 2016 Jkt 238001 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). As required under Rule 19b–4(f)(6)(iii), the Exchange provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. 15 17 CFR 240.19b–4(f)(6). 16 17 CFR 240.19b–4(f)(6)(iii). 17 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). 14 17 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 12 See protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 13 and Rule 19b– 4(f)(6) thereunder.14 A proposed rule change filed pursuant to Rule 19b–4(f)(6) under the Act 15 normally does not become operative for 30 days after the date of its filing. However, Rule 19b–4(f)(6)(iii) 16 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Exchange states that waiver of the 30-day operative delay would allow the Exchange to modify its rules in a timely manner by: (i) Eliminating a rule that accounts for services with few subscribers that the Exchange intends to discontinue; and (ii) accurately describing the alternative routing options available to Users, thereby avoiding potential investor confusion during the operative delay period. Based on the foregoing, the Commission believes the waiver of the operative delay is consistent with the protection of investors and the public interest. Therefore, the Commission hereby waives the operative delay and designates the proposal operative upon filing.17 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 change should be approved or disapproved. PO 00000 Frm 00125 Fmt 4703 Sfmt 4703 30361 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– BatsBYX–2016–06 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 No. SR–BatsBYX–2016–06. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File No. SR–BatsBYX– 2016–06, and should be submitted on or before June 6, 2016. E:\FR\FM\16MYN1.SGM 16MYN1 30362 Federal Register / Vol. 81, No. 94 / Monday, May 16, 2016 / Notices For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.18 Robert W. Errett, Deputy Secretary. [FR Doc. 2016–11401 Filed 5–13–16; 8:45 am] BILLING CODE 8011–01–P 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 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–77801; File No. SR–Phlx– 2016–55] Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify the Maximum Number of Times an Order on PSX May Be Updated Before the System Cancels the Order May 10, 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 May 2, 2016, NASDAQ PHLX LLC (‘‘Phlx’’ or ‘‘Exchange’’) 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 The Exchange proposes to modify the maximum number of times an Order on PSX may be updated before the System cancels the Order. The text of the proposed rule change is available on the Exchange’s Web site at https://nasdaqomxphlx. cchwallstreet.com/, at the principal office of the Exchange, and at the Commission’s Public Reference Room. asabaliauskas on DSK3SPTVN1PROD with NOTICES 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 18 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 18:48 May 13, 2016 Jkt 238001 Background The Exchange will cancel an Order if it is updated a certain number of times during any given day. Pursuant to Rule 3301A(a), an Order will be cancelled if it is repriced and/or reentered 10,000 times for any reason.3 Pursuant to Rule 3301A(b)(5)(A), a Market Maker Peg Order will be canceled if it is repriced 1,000 times. Pursuant to Rule 3301B(d), an Order with Primary Pegging will be cancelled if it is updated 1,000 times, and an Order with Market Pegging will be cancelled if it is updated 10,000 times. The Exchange applies these limits to conserve System resources by limiting the persistence of Orders that update repeatedly without execution. These limits are applied daily to each order entered into the System. Orders that have a Time-in-Force 4 that allows them to persist longer than a single trading day will have their count reset each day. For example, if an Order with a Timein-Force of Good-till-Canceled 5 is repriced 9,999 times during any given day, the Order will not be canceled due to the number of updates. Starting the next day, the Order would be again allowed to reprice up to 9,999 times before it would be canceled by the System. Proposed Changes First, the Exchange is proposing to eliminate rule text under Rules 3301A(a), 3301A(b)(5)(A), and 3301B(d) concerning cancellation based on Order updates and consolidate the concept under a new Rule 3306(a)(4). Second, the Exchange is proposing to no longer state the specific number of times a particular Order Type may be 3 Orders entered through OUCH and FLITE ports generally are not repriced or reentered. As explained in rule 3301A(b)(1)(B), orders entered through OUCH and FLITE may be updated for display once. Further, OUCH and FLITE Orders may only be decremented in size, which is not considered repricing or reentry of the Order. See https://www.nasdaqtrader.com/ Trader.aspx?id=TradingSpecs for a description of the various order entry port specifications. 4 The ‘‘Time-in-Force’’ assigned to an Order means the period of time that the System will hold the Order for potential execution. See Rule 3301B(a). 5 An Order that is designated to deactivate one year after entry may be referred to as a ‘‘Good-tillCancelled.’’ See Rule 3301B(a)(3). PO 00000 Frm 00126 Fmt 4703 Sfmt 4703 updated before it is canceled in the new rule and is, instead, noting that the number of permissible changes may vary by Order Type or Order Attribute and may change from time to time. Further, the proposed rule will note that the Exchange will post on its Web site what is considered a change for a particular Order Type and Order Attribute, and the current limits on the number of such changes. The Exchange is changing the process by which it counts updates, which will allow it to identify a wider range of updates to an Order. Using the new process, the Exchange will be able to track the following Order updates: (1) System-generated child Orders; (2) display size refreshes from reserve; (3) replaces of System-generated child Orders (which include Orders with a Pegging Attribute); and (4) cancellation requests of System-generated child Orders. The Exchange notes that all updates identified by the current process will be counted under the new process. The Exchange believes these changes will provide it with greater flexibility in addressing changes in volume, market participant behavior, and the Exchange’s capacity to handle the message volume caused by Orders that update a significant number of times throughout the trading day. The Exchange will provide at least one day’s advanced notice to the public of any changes to the number of updates permitted before an Order is canceled. Initially, the Exchange will keep the number of updates consistent with what is currently noted in the rules; however, the Exchange may shortly thereafter change the number of updates as needed to address market conditions. Phlx is also making minor technical corrections to Rule 3301B(d) to change the word ‘‘they’’ to the word ‘‘the’’ in the first full paragraph below the bulleted list under the rule and to delete an erroneous quote from the end of the same paragraph. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,6 in general, and with Section 6(b)(5) of the Act,7 in particular, because it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to 6 15 7 15 U.S.C. 78f. U.S.C. 78f(b)(5). E:\FR\FM\16MYN1.SGM 16MYN1

Agencies

[Federal Register Volume 81, Number 94 (Monday, May 16, 2016)]
[Notices]
[Pages 30360-30362]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-11401]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77790; File No. SR-BatsBYX-2016-06]


Self-Regulatory Organizations; Bats BYX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
Rule 11.13, Order Execution and Routing, To Delete the IOCM and ICMT 
Routing Options

May 10, 2016.
    Pursuant to the provisions of 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 May 2, 2016, Bats BYX Exchange, Inc. (the 
``Exchange'' or ``BYX'') filed with the Securities and Exchange 
Commission (``Commission'') the proposed rule change as described in 
Items I and II below, which Items have been prepared by the Exchange. 
The Exchange has designated this proposal as a ``non-controversial'' 
proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and 
Rule 19b-4(f)(6)(iii) thereunder,\4\ which renders it effective upon 
filing with the Commission. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6)(iii).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend Rule 11.13, Order Execution 
and Routing, to delete the IOCM and ICMT routing options. The Exchange 
also proposes to amend its fee schedule to delete: (i) References to 
the IOCM and ICMT routing options under footnote 8; and (ii) fee code 
PX, which is yielded on orders routed using the RMPT routing option or 
routed to Bats EDGX Exchange, Inc. (``EDGX'') to execute against 
MidPoint Peg Orders \5\ on EDGX using ICMT or IOCM routing options.
---------------------------------------------------------------------------

    \5\ See EDGX Rule 11.8(d). The BYX fee schedule uses the term 
``EDGX MPM'' for fee code PX. EDGX MPM is intended to refer to 
contra side MidPoint Peg Orders on EDGX.
---------------------------------------------------------------------------

    The text of the proposed rule change is available at the Exchange's 
Web site at www.batstrading.com, at the principal office of the 
Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
Sections A, B, and C below, of the most significant parts of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend Rule 11.13, Order Execution and 
Routing, to delete the IOCM and ICMT routing options. The Exchange also 
proposes to amend its fee schedule to delete: (i) References to the 
IOCM and ICMT routing options under footnote 8; and (ii) fee code PX, 
which is yielded on orders routed using the RMPT routing option or 
routed to EDGX to execute against MidPoint Peg Orders on EDGX using 
ICMT or IOCM routing options.
    Under Rule 11.13(b)(3)(O), an order utilizing the IOCM routing 
option checks the System \6\ for available shares and then is sent, as 
MidPoint Peg Order with a Time-in-Force of IOC, to EDGX. Under Rule 
11.13(b)(3)(P), an order utilizing the ICMT routing option checks the 
System for available shares, then is sent to destinations on the System 
routing table and then is sent, as MidPoint Peg Order with a Time-in-
Force of IOC, to EDGX. If shares remain unexecuted after routing 
pursuant to both the IOCM and ICMT routing options, they are posted on 
the book, unless otherwise instructed by the User.\7\
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    \6\ The ``System'' is the Exchange's electronic communications 
and trading facility designated by the Board through which 
securities orders of Users are consolidated for ranking, execution 
and, when applicable, routing away. See Exchange Rule 1.5(aa).
    \7\ The term ``User'' is defined as ``any Member or Sponsored 
Participant who is authorized to obtain access to the System 
pursuant to Rule 11.3.'' See Exchange Rule 1.5(cc).
---------------------------------------------------------------------------

    Footnote 8 of the fee schedule states that orders in securities 
priced below $1.00 that remove liquidity utilizing certain routing 
strategies, including IOCM and ICMT are charged a fee of $0.29% of the 
trade's total dollar value. Fee code PX is yielded on orders routed 
using the RMPT routing option or routed to EDGX to execute against 
MidPoint Peg Orders on EDGX using ICMT or IOCM routing options. Orders 
that yield fee code PX pay a fee of $0.0012 per share in securities 
priced at or above $1.00 and 0.29% of the trade's dollar value for 
securities priced below $1.00.
    Because few Users elect the IOCM or ICMT routing options, the 
Exchange has determined that the current demand does not warrant the 
infrastructure and ongoing maintenance expenses required to support the 
products. Therefore, the Exchange proposes to delete the IOCM and ICMT 
routing options under Rule 11.13(b)(3)(O) and (P) as well as a 
reference to the IOCM and ICMT routing options under Rule 
11.13(b)(3)(H). The Exchange also proposes to amend its fee schedule to 
delete: (i) References to the IOCM and ICMT routing options under 
footnote 8; and (ii) fee code PX, which is yielded on orders routed 
using the RMPT routing option or routed to EDGX to execute against 
MidPoint Peg Orders on EDGX using ICMT or IOCM routing options. Users 
seeking to route midpoint eligible orders to EDGX may use alternative 
methods, such as connecting to EDGX directly or through a third party 
service provider, or electing another routing option offered by the 
Exchange that enables a User to post an order to certain primary 
listing markets.\8\
---------------------------------------------------------------------------

    \8\ See e.g., Rule 11.13(b)(3)(Q) (describing the RMPT routing 
option under which a Mid-Point Peg Order checks the System for 
available shares and any remaining shares are then sent to 
destinations on the System routing table that support midpoint 
eligible orders. If any shares remain unexecuted after routing, they 
are posted on the BYX book as a MidPoint Peg Order, unless otherwise 
instructed by the User).
---------------------------------------------------------------------------

    The Exchange intends to implement the proposed rule change on May 
5, 2016.\9\
---------------------------------------------------------------------------

    \9\ See Bats to Decommission ICMT, IOCM, and TRIM3 Routing 
Strategies, issued April 18, 2016, available at https://cdn.batstrading.com/resources/release_notes/2016/Bats-to-Decommission-ICMT-IOCM-and-TRIM3-Routing-Strategies.pdf.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \10\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \11\ in particular, in that it is designed to 
promote just and equitable principles of

[[Page 30361]]

trade, to foster cooperation and coordination with persons engaged in 
facilitating transactions in securities, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange does not believe that this proposal will permit unfair 
discrimination among customers, brokers, or dealers because the IOCM 
and ICMT routing options will no longer be available to all Users. The 
Exchange has few Users electing the IOCM and ICMT routing options and 
has determined that the current demand does not warrant the 
infrastructure and ongoing maintenance expense required to support the 
products. Routing through the Exchange is voluntary and alternative 
routing options offered by the Exchange as well as other methods remain 
available to Users that wish to route midpoint eligible orders to 
EDGX.\12\ In addition, the IOCM and ICMT routing options are not core 
product offerings by the Exchange, nor is the Exchange required by the 
Act to offer such products. Therefore, the Exchange believes the 
proposed rule change would make its rules clearer and less confusing 
for investors by removing routing options that will no longer be 
offered by the Exchange; thereby removing impediments to and perfecting 
the mechanism of a free and open market and a national market system, 
and, in general, protecting investors and the public interest.
---------------------------------------------------------------------------

    \12\ See supra note 8 and accompanying text.
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposal will impose any 
burden on competition not necessary or appropriate in furtherance of 
the purposes of the Act. The proposed rule change is not designed to 
address any competitive issues but rather avoid investor confusion by 
eliminating the IOCM and ICMT routing options that are to be 
discontinued by the Exchange.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

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

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

    Because the proposed rule change does not (i) significantly affect 
the protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 30 
days from the date on which it was filed, or such shorter time as the 
Commission may designate, it has become effective pursuant to Section 
19(b)(3)(A) of the Act \13\ and Rule 19b-4(f)(6) thereunder.\14\
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written 
notice of its intent to file the proposed rule change, along with a 
brief description and the text of the proposed rule change, at least 
five business days prior to the date of filing of the proposed rule 
change, or such shorter time as designated by the Commission.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \15\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \16\ permits the 
Commission to designate a shorter time if such action is consistent 
with the protection of investors and the public interest. The Exchange 
has asked the Commission to waive the 30-day operative delay so that 
the proposal may become operative immediately upon filing. The Exchange 
states that waiver of the 30-day operative delay would allow the 
Exchange to modify its rules in a timely manner by: (i) Eliminating a 
rule that accounts for services with few subscribers that the Exchange 
intends to discontinue; and (ii) accurately describing the alternative 
routing options available to Users, thereby avoiding potential investor 
confusion during the operative delay period. Based on the foregoing, 
the Commission believes the waiver of the operative delay is consistent 
with the protection of investors and the public interest. Therefore, 
the Commission hereby waives the operative delay and designates the 
proposal operative upon filing.\17\
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    \15\ 17 CFR 240.19b-4(f)(6).
    \16\ 17 CFR 240.19b-4(f)(6)(iii).
    \17\ 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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    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 change should be approved or 
disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-BatsBYX-2016-06 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 No. SR-BatsBYX-2016-06. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File No. SR-BatsBYX-2016-06, and should be 
submitted on or before June 6, 2016.


[[Page 30362]]


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-11401 Filed 5-13-16; 8:45 am]
 BILLING CODE 8011-01-P
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