Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 11.330 To Combine the TOPS and LAST Data Products and Make Minor Correcting and Conforming Changes to the Description of TOPS Viewer, 52730-52733 [2016-18795]

Download as PDF 52730 Federal Register / Vol. 81, No. 153 / Tuesday, August 9, 2016 / Notices 5. Pending Reviews. In addition to the above reports, the Chief Regulatory Officer (CRO) (or his or her designee) of any Participating Organization that is also a Listing Market [(including CHX)] may inquire about pending reviews involving stocks listed on that Participating Organization’s market. FINRA will respond to such inquiries from a CRO; provided, however, that (a) the CRO must hold any information provided by FINRA in confidence and (b) FINRA will not be compelled to provide information in contradiction of any mandate, directive or order from the SEC, US Attorney’s Office, the Office of any State Attorney General or court of competent jurisdiction. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing. Comments may be submitted by any of the following methods: asabaliauskas on DSK3SPTVN1PROD with NOTICES 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 4– 566 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 4–566. 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 plan that are filed with the Commission, and all written communications relating to the proposed plan 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 plan also will be available for inspection and copying at the principal offices of the Participating Organizations. All comments received will be posted without change; the Commission does VerDate Sep<11>2014 20:00 Aug 08, 2016 Jkt 238001 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 4–566 and should be submitted on or before August 30, 2016. V. Discussion The Commission finds that the Plan, as proposed to be amended, is consistent with the factors set forth in Section 17(d) of the Act 14 and Rule 17d–2 thereunder 15 in that it is necessary or appropriate in the public interest and for the protection of investors, fosters cooperation and coordination among SROs, and removes impediments to and fosters the development of the national market system. The Commission continues to believe that the Plan, as amended, should reduce unnecessary regulatory duplication by allocating regulatory responsibility for the surveillance, investigation, and enforcement of Common Rules to FINRA. Accordingly, the proposed amendment to the Plan promotes efficiency by consolidating these regulatory functions in a single SRO. Under paragraph (c) of Rule 17d–2, the Commission may, after appropriate notice and comment, declare a plan, or any part of a plan, effective. In this instance, the Commission believes that appropriate notice and comment can take place after the proposed amendment is effective. In particular, the purpose of the amendment is to add IEX as a Participating Organization and reflect that IEX will be a Listing Market (which will expand the Plan’s coverage of NMS Stocks to include equity securities listed on IEX), remove CBOE as a Participating Organization and update the names of certain other Participating Organizations, update defined terms, and reflect updates to the list of Common Rules. The Commission notes that the most recent prior amendment to the Plan, which, among other things, reflected the addition of BATS as a Listing Market, was published for comment and the Commission did not receive any comments thereon.16 The Commission believes that the current amendment to the Plan does not raise any new regulatory issues that the Commission has not previously considered, and therefore believes that the amended Plan should become effective without any undue delay. 14 15 U.S.C. 78q(d). CFR 240.17d–2. 16 See supra note 11. 15 17 PO 00000 Frm 00121 Fmt 4703 Sfmt 4703 VI. Conclusion This order gives effect to the amended Plan submitted to the Commission that is contained in File No. 4–566. It is therefore ordered, pursuant to Section 17(d) of the Act,17 that the Plan, as amended, filed with the Commission pursuant to Rule 17d–2 on July 21, 2016, is hereby approved and declared effective. It is further ordered that the Participating Organizations are relieved of those regulatory responsibilities allocated to FINRA under the amended Plan to the extent of such allocation. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.18 Robert W. Errett, Deputy Secretary. [FR Doc. 2016–18793 Filed 8–8–16; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–78475; File No. SR–IEX– 2016–05] Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 11.330 To Combine the TOPS and LAST Data Products and Make Minor Correcting and Conforming Changes to the Description of TOPS Viewer August 3, 2016. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on July 28, 2016, the Investors Exchange LLC (‘‘IEX’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. 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 Pursuant to the provisions of Section 19(b)(1) under the Securities Exchange Act of 1934 (‘‘Act’’),4 and Rule 19b–4 thereunder,5 Investors Exchange LLC 17 15 U.S.C. 78q(d). CFR 200.30–3(a)(34). 1 15 U.S.C. 78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 4 15 U.S.C. 78s(b)(1). 5 17 CFR 240.19b–4. 18 17 E:\FR\FM\09AUN1.SGM 09AUN1 Federal Register / Vol. 81, No. 153 / Tuesday, August 9, 2016 / Notices (‘‘IEX’’ or ‘‘Exchange’’) is filing with the Securities and Exchange Commission (‘‘Commission’’) a proposed rule change to amend Rule 11.330 (Data Products) to (i) combine the TOPS and LAST data products to eliminate the LAST data product and add execution information to the TOPS data product, and (2) make minor correcting and conforming changes to the description of TOPS Viewer. The Exchange has designated this proposal as non-controversial and provided the Commission with the notice required by Rule 19b–4(f)(6)(iii) under the Act.6 The text of the proposed rule change is available at the Exchange’s Web site at www.iextrading.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 statement [sic] may be examined at the places specified in Item IV below. The self-regulatory organization 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 asabaliauskas on DSK3SPTVN1PROD with NOTICES 1. Purpose The Exchange proposes to amend Rule 11.330 (Data Products) to combine the TOPS and LAST data products, to eliminate the LAST data product, and to add execution information to the TOPS data product. Currently, Rule 11.330(a)(1) specifies that the TOPS data product is an uncompressed data feed that offers aggregated top of book quotations for all displayed orders resting on the Order Book, while paragraph (a)(3) specifies that the LAST data product is an uncompressed data feed that offers only execution information based on equities orders entered into the System (i.e. last sale information). IEX has determined to add the information contemplated to be provided in LAST into TOPS. Accordingly, the Exchange proposes to amend Rule 11.330(a)(1) to provide that TOPS is an uncompressed data feed 6 17 CFR 240.19b–4(f)(6)(iii). VerDate Sep<11>2014 20:00 Aug 08, 2016 Jkt 238001 that offers aggregated top of book quotations for all displayed orders resting on the Order Book and execution information for executions on the Exchange (i.e., last sale information). As proposed, TOPS will disseminate, on a real-time basis,7 (1) the aggregate best bid and offer (‘‘BBO’’) of all displayed orders for securities traded on IEX; and (2) the price, size, and time of execution for each transaction executed on IEX. For the sake of clarity, the Exchange also proposes to make certain nonsubstantive changes to the existing description of LAST as it is incorporated into the TOPS description. Specifically, rather than describe execution information as ‘‘based on equity orders entered into the System,’’ which technically could include executions on away exchanges of orders routed to such exchanges, the proposed text would clarify IEX includes execution information for orders executed on the Exchange. All information that will be provided in TOPS will also be reported under the Consolidated Tape Association (‘‘CTA’’) Plan or the Nasdaq/UTP Plan. The Exchange will release information to TOPS and TOPS Viewer in compliance with Rule 603(a) of Regulation NMS, which requires that exchanges distribute market data on terms that are ‘‘fair and reasonable’’ and ‘‘not unreasonably discriminatory,’’ and prohibits an exchange from releasing data relating to quotes and trades to its customers through proprietary feeds before it sends its quotes and trade reports for inclusion in the consolidated feeds.8 The Exchange also proposes to make minor correcting and conforming changes to Rule 11.330(a)(2), which describes TOPS Viewer. Currently, as specified therein, TOPS Viewer is described as a data feed, currently available through the Exchange’s public Web site, that offers two-sided quotations for all displayed orders resting on the Order Book as well as the aggregate volume traded execution information based on orders entered into the System. TOPS and TOPS Viewer contain the same information, delivered in different manners. TOPS provides the specified information only through an application programming interface (‘‘API’’) via the POP (an API is 7 Rule 11.510(b)(2) describes the application of the POP to outbound communications from the Exchange, which impacts TOPS. As specified therein, the POP ‘‘is designed to provide all Participants with an equivalent 350 microseconds of latency from the System at the primary data center to the Exchange-provided network interface at the IEX POP.’’ 8 See Regulation NMS, 70 FR 37,496, 37,567 (June 29, 2005) (adopting release); see also Concept Release, 75 FR at 3601 (January 21, 2010). PO 00000 Frm 00122 Fmt 4703 Sfmt 4703 52731 by definition not human readable). TOPS Viewer provides the specified information in both a human readable format on the Exchange’s Web site as well as through an API from the Exchange’s Web site. IEX proposes to make three minor changes to the description of TOPS Viewer in subparagraph (a)(2) of Rule 11.330. First, IEX proposes a ministerial change to conform the description of the quotation information available through TOPS Viewer, in subparagraph (a)(2) of the Rule, to the description set forth in the description of TOPS in subparagraph (a)(1). Second, IEX proposes a correcting change to delete the word ‘‘aggregate’’ in the description because information will be provided for each execution, rather than on an aggregated basis. Third, IEX proposes to include the clarifying language proposed to be added to subparagraph (a)(1) of the rule to make clear that the execution information provided is for transactions executed on the Exchange (i.e., last sale information). 2. Statutory Basis IEX believes that the proposed rule change is consistent with the provisions of Section 6 of the Act 9 in general, and with Section 6(b)(5) of the Act,10 in particular. TOPS and TOPS Viewer will be provided consistent with the purposes of Section 6(b)(5) of the Act.11 Moreover, the proposed rule change is not designed to permit unfair discrimination among customers, issuers, and brokers; and is designed to promote just and equitable principles of 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 proposed rule change is designed to promote just and equitable principles of trade and remove impediments to and perfect the mechanism of a free and open market and a national market system by providing quotation and transaction information to market participants. The Exchange also believes this proposal is consistent with Section 6(b)(5) of the Act because it protects investors and the public interest and promotes just and equitable principles of trade by providing market participants with the option to receive such information otherwise than under the CTA and Nasdaq/UTP Plans. 9 15 U.S.C. 78f(b). U.S.C. 78f(b)(4) [sic], (5). 11 15 U.S.C. 78f(b)(5). 10 15 E:\FR\FM\09AUN1.SGM 09AUN1 52732 Federal Register / Vol. 81, No. 153 / Tuesday, August 9, 2016 / Notices Further, the proposal would not permit unfair discrimination because the information will be available to all market participants and market data vendors on an equivalent basis and without charge. In addition, any market participant that wishes to receive such information via the CTA and Nasdaq/ UTP Plans will be able to do so. As noted above, the Exchange is simply proposing to include data elements contemplated to be included in LAST data product in TOPS, as well as to make minor correcting and conforming changes to the description of TOPS Viewer. The Exchange also believes that the proposed rule change is consistent with Section 11(A) of the Act 12 in that it supports (1) fair competition among brokers and dealers, among exchange markets, and between exchange markets and markets other than exchange markets and (2) the availability to brokers, dealers, and investors of information with respect to quotations for and transactions in securities. Furthermore, the proposed rule change is consistent with Rule 603 of Regulation NMS,13 which provides that any national securities exchange which distributes information with respect to quotations for or transactions in an NMS stock do so on terms that are fair and reasonable and not unreasonably discriminatory. As noted above, the Exchange will provide TOPS and TOPS Viewer to Members and other recipients of Exchange data on terms that are fair and reasonable and not unreasonably discriminatory in that TOPS and TOPS Viewer will be provided free of charge and TOPS Viewer is available to the public via the Exchange’s Web site. B. Self-Regulatory Organization’s Statement on Burden on Competition asabaliauskas on DSK3SPTVN1PROD with NOTICES IEX does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange is not proposing to charge a fee for the TOPS feed, and will make the feed available to market participants on a fair and impartial basis, and on terms that are not unreasonably discriminatory. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments were neither solicited nor received. 12 15 U.S.C. 78k–1. 17 CFR 242.603. 13 See VerDate Sep<11>2014 20:00 Aug 08, 2016 Jkt 238001 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has designated this rule filing as non-controversial under Section 19(b)(3)(A) 14 of the Act and Rule 19b–4(f)(6) 15 thereunder. 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, it has become effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b–4(f)(6) thereunder.16 The Exchange has asked the Commission to waive the 30-day operative delay, making this proposal operative upon filing. The Exhange argues that the proposed rule filing merely combines the data elements from the LAST data product into TOPS and TOPS Viewer, and makes minor conforming and correcting changes to Rule 11.330. According to the Exchange, waiver of the operative delay is, therefore, consistent with the protection of investors and the public interest, because it will allow the Exchange to implement the proposed rule change to coincide with IEX’s launch of exchange operations during a security-by-security phase-in period beginning August 19, 2016, and thus provide operational simplification to Members and other recipients of Exchange data as well as a source of Exchange data free of charge otherwise than under the CTA and Nasdaq/UTP Plans, consistent with the protection of investors and the public interest. The Exchange further adds that waiver of the operative delay period will also enable the Exchange to make the minor correcting and clarifying changes described herein to coincide with IEX’s launch of exchange operations. The Commission believes that waiver of the operative delay is consistent with the protection of investors and the public interest. The Commission notes that the proposal would merely consolidate existing data products and make minor, clarifying changes to the descriptions of TOPS and TOPS Viewer. 14 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). 16 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. 15 17 PO 00000 Frm 00123 Fmt 4703 Sfmt 4703 In the absence of a waiver of the operative delay, customers would have to subscribe to two data products to receive both top-of-book and last sale information when the Exchange begins operating on August 19, 2016, until the proposal becomes effective shortly thereafter. Waiving the operative delay would provide customers with the opportunity to receive a single, streamlined product with top-of-book and last sale information and would also provide customers with greater clarity about the content of the available products from the outset of the Exchange’s launch of operations. Therefore, the Commission hereby waives the operative delay and designates the proposed rule change 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 under Section 19(b)(2)(B)18 of the Act 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– IEX–2016–05 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–IEX–2016–05. This file number should be included on the subject line if email is used. To help the Commission process and review your 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). 18 15 U.S.C. 78s(b)(2)(B). E:\FR\FM\09AUN1.SGM 09AUN1 Federal Register / Vol. 81, No. 153 / Tuesday, August 9, 2016 / Notices 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–IEX– 2016–05 and should be submitted on or before August 30, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 Robert W. Errett, Deputy Secretary. [FR Doc. 2016–18795 Filed 8–8–16; 8:45 am] BILLING CODE 8011–01–P DEPARTMENT OF STATE [Public Notice: 9666] asabaliauskas on DSK3SPTVN1PROD with NOTICES International Security Advisory Board (ISAB); Meeting Notice Closed Meeting In accordance with section 10(a)(2) of the Federal Advisory Committee Act, 5 U.S.C. App 10(a)(2), the Department of State announces a meeting of the International Security Advisory Board (ISAB) to take place on September 16, 2016, at the Department of State, Washington, DC. Pursuant to section 10(d) of the Federal Advisory Committee Act, 5 U.S.C. App 10(d), and 5 U.S.C. 552b(c)(1), it has been determined that this Board meeting will be closed to the public because the Board will be reviewing and discussing matters properly classified in accordance with Executive Order 13526. The purpose of 19 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 20:00 Aug 08, 2016 Jkt 238001 the ISAB is to provide the Department with a continuing source of independent advice on all aspects of arms control, disarmament, nonproliferation, political-military affairs, international security, and related aspects of public diplomacy. The agenda for this meeting will include classified discussions related to the Board’s studies on current U.S. policy and issues regarding arms control, international security, nuclear proliferation, and diplomacy. For more information, contact Christopher Herrick, Executive Director of the International Security Advisory Board, U.S. Department of State, Washington, DC 20520, telephone: (202) 647–9683. Dated: July 19, 2016. Christopher Herrick, Executive Director, International Security Advisory Board, U.S. Department of State. [FR Doc. 2016–18855 Filed 8–8–16; 8:45 am] BILLING CODE 4710–27–P SURFACE TRANSPORTATION BOARD [Docket No. AB 290 (Sub–No. 386X)] Norfolk Southern Railway Company— Abandonment Exemption—in Charleston, S.C. Norfolk Southern Railway Company (NSR) has filed a verified notice of exemption under 49 CFR pt. 1152 subpart F–Exempt Abandonments to abandon approximately 1.97 miles of rail line between milepost SC 0.33 and milepost SC 2.3 in Charleston, S.C. (the Line). The Line traverses United States Postal Service Zip Codes 29403 and 29405. NSR has certified that: (1) No local traffic has moved over the Line for at least two years; (2) no overhead traffic has moved over the Line for at least two years and that overhead traffic, if there were any, could be rerouted over other lines; (3) no formal complaint filed by a user of rail service on the Line (or by a state or local government entity acting on behalf of such user) regarding cessation of service over the Line either is pending with the Surface Transportation Board (Board) or with any U.S. District Court or has been decided in favor of complainant within the two-year period; and (4) the requirements at 49 CFR 1105.7(c) (environmental report), 49 CFR 1105.11 (transmittal letter), 49 CFR 1105.12 (newspaper publication), and 49 CFR 1152.50(d)(1) (notice to governmental agencies) have been met. As a condition to this exemption, any employee adversely affected by the PO 00000 Frm 00124 Fmt 4703 Sfmt 4703 52733 abandonment shall be protected under Oregon Short Line Railroad— Abandonment Portion Goshen Branch Between Firth & Ammon, in Bingham & Bonneville Counties, Idaho, 360 I.C.C. 91 (1979). To address whether this condition adequately protects affected employees, a petition for partial revocation under 49 U.S.C. 10502(d) must be filed. Provided no formal expression of intent to file an offer of financial assistance (OFA) has been received, this exemption will be effective on September 8, 2016, unless stayed pending reconsideration. Petitions to stay that do not involve environmental issues,1 formal expressions of intent to file an OFA under 49 CFR 1152.27(c)(2),2 and trail use/rail banking requests under 49 CFR 1152.29 must be filed by August 19, 2016. Petitions to reopen or requests for public use conditions under 49 CFR 1152.28 must be filed by August 29, 2016, with the Surface Transportation Board, 395 E Street SW., Washington, DC 20423– 0001. A copy of any petition filed with the Board should be sent to NSR’s representative: William A. Mullins, Baker & Miller PLLC, 2401 Pennsylvania Ave. NW., Suite 300, Washington, DC 20037. If the verified notice contains false or misleading information, the exemption is void ab initio. NSR has filed a combined environmental and historic report that addresses the effects, if any, of the abandonment on the environment and historic resources. OEA will issue an environmental assessment (EA) by August 12, 2016. Interested persons may obtain a copy of the EA by writing to OEA (Room 1100, Surface Transportation Board, Washington, DC 20423–0001) or by calling OEA at (202) 245–0305. Assistance for the hearing impaired is available through the Federal Information Relay Service at (800) 877–8339. Comments on environmental and historic preservation matters must be filed within 15 days after the EA becomes available to the public. 1 The Board will grant a stay if an informed decision on environmental issues (whether raised by a party or by the Board’s Office of Environmental Analysis (OEA) in its independent investigation) cannot be made before the exemption’s effective date. See Exemption of Out-of-Serv. Rail Lines, 5 I.C.C. 2d 377 (1989). Any request for a stay should be filed as soon as possible so that the Board may take appropriate action before the exemption’s effective date. 2 Each OFA must be accompanied by the filing fee, which is currently set at $1,600. See 49 CFR 1002.2(f)(25). E:\FR\FM\09AUN1.SGM 09AUN1

Agencies

[Federal Register Volume 81, Number 153 (Tuesday, August 9, 2016)]
[Notices]
[Pages 52730-52733]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-18795]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-78475; File No. SR-IEX-2016-05]


Self-Regulatory Organizations; Investors Exchange LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Amend 
Rule 11.330 To Combine the TOPS and LAST Data Products and Make Minor 
Correcting and Conforming Changes to the Description of TOPS Viewer

August 3, 2016.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on July 28, 2016, the Investors Exchange LLC (``IEX'' or 
the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I 
and II below, which Items have been prepared by the 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\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

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

    Pursuant to the provisions of Section 19(b)(1) under the Securities 
Exchange Act of 1934 (``Act''),\4\ and Rule 19b-4 thereunder,\5\ 
Investors Exchange LLC

[[Page 52731]]

(``IEX'' or ``Exchange'') is filing with the Securities and Exchange 
Commission (``Commission'') a proposed rule change to amend Rule 11.330 
(Data Products) to (i) combine the TOPS and LAST data products to 
eliminate the LAST data product and add execution information to the 
TOPS data product, and (2) make minor correcting and conforming changes 
to the description of TOPS Viewer. The Exchange has designated this 
proposal as non-controversial and provided the Commission with the 
notice required by Rule 19b-4(f)(6)(iii) under the Act.\6\
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78s(b)(1).
    \5\ 17 CFR 240.19b-4.
    \6\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    The text of the proposed rule change is available at the Exchange's 
Web site at www.iextrading.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 statement [sic] may be examined 
at the places specified in Item IV below. The self-regulatory 
organization 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 11.330 (Data Products) to 
combine the TOPS and LAST data products, to eliminate the LAST data 
product, and to add execution information to the TOPS data product. 
Currently, Rule 11.330(a)(1) specifies that the TOPS data product is an 
uncompressed data feed that offers aggregated top of book quotations 
for all displayed orders resting on the Order Book, while paragraph 
(a)(3) specifies that the LAST data product is an uncompressed data 
feed that offers only execution information based on equities orders 
entered into the System (i.e. last sale information). IEX has 
determined to add the information contemplated to be provided in LAST 
into TOPS.
    Accordingly, the Exchange proposes to amend Rule 11.330(a)(1) to 
provide that TOPS is an uncompressed data feed that offers aggregated 
top of book quotations for all displayed orders resting on the Order 
Book and execution information for executions on the Exchange (i.e., 
last sale information). As proposed, TOPS will disseminate, on a real-
time basis,\7\ (1) the aggregate best bid and offer (``BBO'') of all 
displayed orders for securities traded on IEX; and (2) the price, size, 
and time of execution for each transaction executed on IEX. For the 
sake of clarity, the Exchange also proposes to make certain non-
substantive changes to the existing description of LAST as it is 
incorporated into the TOPS description. Specifically, rather than 
describe execution information as ``based on equity orders entered into 
the System,'' which technically could include executions on away 
exchanges of orders routed to such exchanges, the proposed text would 
clarify IEX includes execution information for orders executed on the 
Exchange. All information that will be provided in TOPS will also be 
reported under the Consolidated Tape Association (``CTA'') Plan or the 
Nasdaq/UTP Plan. The Exchange will release information to TOPS and TOPS 
Viewer in compliance with Rule 603(a) of Regulation NMS, which requires 
that exchanges distribute market data on terms that are ``fair and 
reasonable'' and ``not unreasonably discriminatory,'' and prohibits an 
exchange from releasing data relating to quotes and trades to its 
customers through proprietary feeds before it sends its quotes and 
trade reports for inclusion in the consolidated feeds.\8\
---------------------------------------------------------------------------

    \7\ Rule 11.510(b)(2) describes the application of the POP to 
outbound communications from the Exchange, which impacts TOPS. As 
specified therein, the POP ``is designed to provide all Participants 
with an equivalent 350 microseconds of latency from the System at 
the primary data center to the Exchange-provided network interface 
at the IEX POP.''
    \8\ See Regulation NMS, 70 FR 37,496, 37,567 (June 29, 2005) 
(adopting release); see also Concept Release, 75 FR at 3601 (January 
21, 2010).
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    The Exchange also proposes to make minor correcting and conforming 
changes to Rule 11.330(a)(2), which describes TOPS Viewer. Currently, 
as specified therein, TOPS Viewer is described as a data feed, 
currently available through the Exchange's public Web site, that offers 
two-sided quotations for all displayed orders resting on the Order Book 
as well as the aggregate volume traded execution information based on 
orders entered into the System. TOPS and TOPS Viewer contain the same 
information, delivered in different manners. TOPS provides the 
specified information only through an application programming interface 
(``API'') via the POP (an API is by definition not human readable). 
TOPS Viewer provides the specified information in both a human readable 
format on the Exchange's Web site as well as through an API from the 
Exchange's Web site.
    IEX proposes to make three minor changes to the description of TOPS 
Viewer in subparagraph (a)(2) of Rule 11.330. First, IEX proposes a 
ministerial change to conform the description of the quotation 
information available through TOPS Viewer, in subparagraph (a)(2) of 
the Rule, to the description set forth in the description of TOPS in 
subparagraph (a)(1). Second, IEX proposes a correcting change to delete 
the word ``aggregate'' in the description because information will be 
provided for each execution, rather than on an aggregated basis. Third, 
IEX proposes to include the clarifying language proposed to be added to 
subparagraph (a)(1) of the rule to make clear that the execution 
information provided is for transactions executed on the Exchange 
(i.e., last sale information).
2. Statutory Basis
    IEX believes that the proposed rule change is consistent with the 
provisions of Section 6 of the Act \9\ in general, and with Section 
6(b)(5) of the Act,\10\ in particular. TOPS and TOPS Viewer will be 
provided consistent with the purposes of Section 6(b)(5) of the 
Act.\11\ Moreover, the proposed rule change is not designed to permit 
unfair discrimination among customers, issuers, and brokers; and is 
designed to promote just and equitable principles of 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.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(4) [sic], (5).
    \11\ 15 U.S.C. 78f(b)(5).
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    The proposed rule change is designed to promote just and equitable 
principles of trade and remove impediments to and perfect the mechanism 
of a free and open market and a national market system by providing 
quotation and transaction information to market participants. The 
Exchange also believes this proposal is consistent with Section 6(b)(5) 
of the Act because it protects investors and the public interest and 
promotes just and equitable principles of trade by providing market 
participants with the option to receive such information otherwise than 
under the CTA and Nasdaq/UTP Plans.

[[Page 52732]]

    Further, the proposal would not permit unfair discrimination 
because the information will be available to all market participants 
and market data vendors on an equivalent basis and without charge. In 
addition, any market participant that wishes to receive such 
information via the CTA and Nasdaq/UTP Plans will be able to do so. As 
noted above, the Exchange is simply proposing to include data elements 
contemplated to be included in LAST data product in TOPS, as well as to 
make minor correcting and conforming changes to the description of TOPS 
Viewer.
    The Exchange also believes that the proposed rule change is 
consistent with Section 11(A) of the Act \12\ in that it supports (1) 
fair competition among brokers and dealers, among exchange markets, and 
between exchange markets and markets other than exchange markets and 
(2) the availability to brokers, dealers, and investors of information 
with respect to quotations for and transactions in securities. 
Furthermore, the proposed rule change is consistent with Rule 603 of 
Regulation NMS,\13\ which provides that any national securities 
exchange which distributes information with respect to quotations for 
or transactions in an NMS stock do so on terms that are fair and 
reasonable and not unreasonably discriminatory. As noted above, the 
Exchange will provide TOPS and TOPS Viewer to Members and other 
recipients of Exchange data on terms that are fair and reasonable and 
not unreasonably discriminatory in that TOPS and TOPS Viewer will be 
provided free of charge and TOPS Viewer is available to the public via 
the Exchange's Web site.
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    \12\ 15 U.S.C. 78k-1.
    \13\ See 17 CFR 242.603.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    IEX does not believe that the proposed rule change will result in 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange is not proposing 
to charge a fee for the TOPS feed, and will make the feed available to 
market participants on a fair and impartial basis, and on terms that 
are not unreasonably discriminatory.

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

    Written comments were neither solicited nor received.

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

    The Exchange has designated this rule filing as non-controversial 
under Section 19(b)(3)(A) \14\ of the Act and Rule 19b-4(f)(6) \15\ 
thereunder. 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, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6) thereunder.\16\ The Exchange has asked the Commission to waive 
the 30-day operative delay, making this proposal operative upon filing. 
The Exhange argues that the proposed rule filing merely combines the 
data elements from the LAST data product into TOPS and TOPS Viewer, and 
makes minor conforming and correcting changes to Rule 11.330. According 
to the Exchange, waiver of the operative delay is, therefore, 
consistent with the protection of investors and the public interest, 
because it will allow the Exchange to implement the proposed rule 
change to coincide with IEX's launch of exchange operations during a 
security-by-security phase-in period beginning August 19, 2016, and 
thus provide operational simplification to Members and other recipients 
of Exchange data as well as a source of Exchange data free of charge 
otherwise than under the CTA and Nasdaq/UTP Plans, consistent with the 
protection of investors and the public interest. The Exchange further 
adds that waiver of the operative delay period will also enable the 
Exchange to make the minor correcting and clarifying changes described 
herein to coincide with IEX's launch of exchange operations.
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    \14\ 15 U.S.C. 78s(b)(3)(A).
    \15\ 17 CFR 240.19b-4(f)(6).
    \16\ 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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    The Commission believes that waiver of the operative delay is 
consistent with the protection of investors and the public interest. 
The Commission notes that the proposal would merely consolidate 
existing data products and make minor, clarifying changes to the 
descriptions of TOPS and TOPS Viewer. In the absence of a waiver of the 
operative delay, customers would have to subscribe to two data products 
to receive both top-of-book and last sale information when the Exchange 
begins operating on August 19, 2016, until the proposal becomes 
effective shortly thereafter. Waiving the operative delay would provide 
customers with the opportunity to receive a single, streamlined product 
with top-of-book and last sale information and would also provide 
customers with greater clarity about the content of the available 
products from the outset of the Exchange's launch of operations. 
Therefore, the Commission hereby waives the operative delay and 
designates the proposed rule change operative upon filing.\17\
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    \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 under 
Section 19(b)(2)(B)\18\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \18\ 15 U.S.C. 78s(b)(2)(B).
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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-IEX-2016-05 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-IEX-2016-05. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your

[[Page 52733]]

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-IEX-2016-05 and should be submitted on or before August 
30, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-18795 Filed 8-8-16; 8:45 am]
 BILLING CODE 8011-01-P
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