Self-Regulatory Organizations: Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Correct Typographical Errors in SR-IEX-2017-06, 16456-16458 [2017-06566]
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Federal Register / Vol. 82, No. 63 / Tuesday, April 4, 2017 / Notices
(A) By order approve or disapprove
such proposed rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be disapproved.
For the Commission, pursuant to delegated
authority.35
Eduardo A. Aleman,
Assistant Secretary.
IV. Solicitation of Comments
BILLING CODE 8011–01–P
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–
MSRB–2017–02 on the subject line.
Paper Comments
asabaliauskas on DSK3SPTVN1PROD with NOTICES
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549.
All submissions should refer to File
Number SR–MSRB–2017–02. 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 MSRB. 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–MSRB–
2017–02 and should be submitted on or
before April 25, 2017.
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[FR Doc. 2017–06562 Filed 4–3–17; 8:45 am]
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–80331; File No. SR–IEX–
2017–08]
Self-Regulatory Organizations:
Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Correct
Typographical Errors in SR–IEX–2017–
06
March 29, 2017.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 2 and
Rule 19b–4 thereunder,3 notice is
hereby given that, on March 17, 2017,
the Investors Exchange LLC 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 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
(‘‘IEX’’ or ‘‘Exchange’’) is filing with the
Commission a proposed rule change to
correct several typographical errors in
Rule 11.190(g)(1)(A) and in the Purpose
Section of SR–IEX–2017–06 describing
the changes to IEX Rule 11.190(g)(1)(A)
proposed therein. The Exchange has
designated this proposal as noncontroversial and has satisfied the
requirements of 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.
35 17
CFR 200.30–3(a)(12).
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.
6 17 CFR 240.19b–4(f)(6)(iii).
1 15
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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 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 recently filed with the
Commission an immediately effective
proposed rule change to amend Rule
11.190(g) to modify the quote instability
coefficients and quote instability
threshold included in the quote
instability calculation specified in
subparagraph (g)(1) of Rule 11.190 for
purposes of determining whether a
crumbling quote exists. The rule filing
was published on the Commission Web
site on March 10, 2017.7 Thereafter the
Exchange identified that the formula
contained in Rule 11.190(g)(1)(A) (the
‘‘formula’’) contains several minor
typographical errors. First, the
numerical references to the Quote
Stability Coefficients contained in the
formula were each represented as
regular text rather than as subscript, as
they are specified in subparagraph (a) of
Rule 11.190(g)(1)(A). Second, the Quote
Stability Variables NC and FC are
incorrectly represented as NC–1 and
FC–1 respectively in the formula.
Exhibit 5 to this filing corrects both of
these typographical errors. In addition,
Exhibit 5 to SR–IEX–2017–06 contains
inconsistent notations on text marked
for deletion and retention whereby the
same phrase is marked for deletion and
also marked as retained and relocated in
the following subparagraph.
Specifically, the phrase ‘‘the quote
instability factor result from the quote
stability calculation is greater than the
defined quote instability threshold’’ is
not clearly shown as relocated. Exhibit
5 to this rule filing corrects this
typographical error by showing the text
of the relocated phrase as new text,
notwithstanding that it was previously
contained in the text of Rule
7 See Securities Exchange Act Release No. 34–
80202; File No. SR–IEX–2017–06.
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Federal Register / Vol. 82, No. 63 / Tuesday, April 4, 2017 / Notices
1.190(g)(1)(A) [sic] as amended by SR–
IEX–2017–06.
In addition, the Purpose Section of
the filing contains two sets of
typographical errors which the
Exchange proposes to correct with this
filing. First, numbered paragraph 1,
beginning on page 8, which describes
one aspect of the proposed amendments
to Rule 11.190(g) inadvertently omits
the Nasdaq Stock Market in the list of
exchanges for which protected
quotations are included in the
Crumbling Quote determination
described in subparagraph (1) of Rule
11.190(g). This paragraph also uses the
word ‘‘protection’’ rather than
‘‘protected’’ in the second sentence. The
proposed rule text in Exhibit 5 to the
rule filing is correct in this respect.
Accordingly, IEX proposes to restate the
relevant portion of the Purpose Section
to read as follows:
1. Rule 11.190(g) states that the Exchange
utilizes real time relative quoting activity of
Protected Quotations, not including IEX
protected quotations, in the quote instability
calculation. As proposed, the Exchange is
proposing to include the protected quotations
of the following exchanges in the quote
instability calculation: New York Stock
Exchange, NYSE Arca, Nasdaq Stock Market,
Nasdaq BX, Bats BZX Exchange, Bats BYX
Exchange, Bats EDGX Exchange, and Bats
EDGA Exchange. In connection with our
analysis of market data, as described above,
the Exchange considered several different
permutations of which exchanges to include
in the model. The research identified that
using the Protected Quotations of these
specific eight exchanges in the aggregate
resulted in the greatest predictive power of
all permutations of exchanges assessed for
determining a crumbling quote.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Second, the description in the
Purpose Section of the filing in the first
and third sentences of numbered
paragraph 3 on page 10, which reference
the quote stability variables to be
retired, incorrectly format N¥1 and F¥1
in regular text, when the numeral 1 and
preceding minus sign in each should be
subscript. Accordingly, IEX proposes to
restate the first three sentences of the
paragraph to read as follows:
The Exchange proposes to revise the quote
stability variables currently specified in
subparagraph (1)(D)(i)(b) of Rule 11.190(g) by
adding seven (7) new variables (NC, FC,
Delta, EPos, ENeg, EPosPrev, and ENegPrev)
and retiring four (4) variables (N¥1, F¥1, E,
and D). Specifically, based on our analysis of
market data, as described above, the
Exchange identified that considering the
maximum change over the course of the
previous millisecond up to the most recent
Protected NBBO change was a more accurate
indicator of a crumbling quote than simply
looking at the absolute state of the market
one millisecond previously. The replacement
of N¥1, F¥1, and D with NC, FC, and Delta,
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16:21 Apr 03, 2017
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respectively, reflects this finding.’’ (internal
footnote omitted)
2. Statutory Basis
IEX believes that the proposed rule
change is consistent with Section 6(b) of
the Act 8 in general, and furthers the
objectives of Section 6(b)(5) of the Act,9
in particular, in that 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 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. Specifically, the
correction of inadvertent typographical
errors in IEX Rule 11.190(g)(1)(A) and in
SR–IEX–2017–06 describing the changes
to IEX Rule 11.190(g)(1)(A) proposed
therein will serve the goals of the Act by
having rule text accurately reflect
system functionality and avoid the
potential for market participant
confusion.
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 believes that the proposed
correction does not impact competition
in any respect since it is designed to
correct typographical errors.
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
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 10 and Rule 19b–
4(f)(6) thereunder.11
8 15
U.S.C. 78f.
U.S.C. 78f(b)(5).
10 15 U.S.C. 78s(b)(3)(A).
11 17 CFR 240.19b–4(f)(6). As required under Rule
19b–4(f)(6)(iii), IEX provided the Commission with
written notice of its intent to file the proposed rule
9 15
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16457
A proposed rule change filed under
Rule 19b–4(f)(6) 12 normally does not
become operative prior to 30 days after
the date of the filing. However, pursuant
to Rule 19b–4(f)(6)(iii),13 the
Commission may 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, noting that the proposal
would correct typographical errors in
SR–IEX–2017–06, and stating that
waiver would allow the Exchange to
implement these corrections upon
effectiveness of the proposal and avoid
potential confusion that otherwise
might occur. The Commission believes
that waiver of the 30-day operative
delay is consistent with the protection
of investors and the public interest
because the proposed rule change
would correct a number of
typographical errors contained in IEX’s
recent SR–IEX–2017–06 filing, but
would not result in any substantive
changes to that proposal. Waiver of the
operative delay will allow IEX to correct
these errors without delay, which
should reduce the potential for
confusion regarding the operation of
IEX’s quote instability calculation
referenced in IEX Rule 11.190.
Therefore, the Commission hereby
waives the operative delay and
designates the proposed rule change
operative upon filing.14
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.
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.
12 17 CFR 240.19b–4(f)(6).
13 17 CFR 240.19b–4(f)(6)(iii).
14 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).
E:\FR\FM\04APN1.SGM
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16458
Federal Register / Vol. 82, No. 63 / Tuesday, April 4, 2017 / Notices
Comments may be submitted by any of
the following methods:
SECURITIES AND EXCHANGE
COMMISSION
Electronic Comments
[Release No. 34–80334; File No. SR–NYSE–
2017–03]
• 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 SR–IEX–
2017–08 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.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
All submissions should refer to File
Number SR–IEX–2017–08. 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–IEX–
2017–08 and should be submitted on or
before April 25, 2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.15
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–06566 Filed 4–3–17; 8:45 am]
BILLING CODE 8011–01–P
15 17
CFR 200.30–3(a)(12).
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Self-Regulatory Organizations; New
York Stock Exchange LLC; Order
Approving Proposed Rule Change
Amending Rule 98
March 29, 2017.
I. Introduction
On January 26, 2017, New York Stock
Exchange LLC (‘‘Exchange’’ or ‘‘NYSE’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule
change to amend NYSE Rule 98. The
proposed rule change was published for
comment in the Federal Register on
February 16, 2017.3 The Commission
received no comments on the proposed
rule change. The Commission is
approving the proposed rule change.
II. Description of the Proposal
The Exchange proposes to amend
Rule 98 to provide that, while on the
Trading Floor, DMMs must trade DMM
securities at their assigned stock trading
post location and may not trade any
security that is a related product of their
DMM securities.4
A. Background
Rule 98 governs the operation of a
DMM unit and paragraph (c)(3) of that
rule specifies restrictions on trading for
member organizations operating a DMM
unit. More specifically, Rule 98(c)(3)(B)
provides that, while on the Trading
Floor of the Exchange,5 employees of
the DMM unit:
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Securities Exchange Act Release No. 80019
(Feb. 10, 2017), 82 FR 10942 (Feb. 16, 2017).
4 As defined in Rule 2(i), the term ‘‘DMM’’ means
an individual member, officer, partner, employee or
associated person of a Designated Market Maker
Unit who is approved by the Exchange to act in the
capacity of a DMM. The term ‘‘DMM securities’’ is
defined in Rule 98(a)(2) to mean any securities
allocated to the DMM unit pursuant to Rule 103B
or other applicable rules. The term ‘‘related
products’’ is defined in Rule 98(a)(7) to mean any
derivative instrument that is related to a DMM
security, including options, warrants, hybrid
securities, single-stock futures, security-based swap
agreement, a forward contract, or any other
instrument that is exercisable into or whose price
is based upon or derived from a security traded at
the Exchange.
5 As defined in Rule 6A, the term ‘‘Trading Floor’’
means the restricted-access physical areas
designated by the Exchange for the trading of
securities, commonly known as the ‘‘Main Room’’
and the ‘‘Buttonwood Room’’ and does not include
(i) the areas in the ‘‘Buttonwood Room’’ designated
by the Exchange where NYSE Amex-listed options
2 17
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(i) Except as provided for in Rule
36.30,6 may trade only DMM securities
only on or through the systems and
facilities of the Exchange as permitted
by Exchange rules.
(ii) except as provided for in Rule
36.30, may not communicate with
individuals or systems responsible for
making trading decisions for related
products or for away-market trading in
their assigned DMM securities.
(iii) shall not have access to customer
information or the DMM unit’s position
in related products.
Accordingly, under current Rule 98,
while on the Trading Floor, DMMs may
only trade DMM securities and, thus,
may not trade any other securities,
including securities that are related
products to their DMM securities.
B. Proposed Rule Change
The Exchange proposes to amend
Rule 98 to remove restrictions on DMM
operations on the Trading Floor that are
unrelated to the role of DMMs at the
Exchange. Specifically, as described in
Rule 104, DMMs have specified
obligations with respect to their DMM
securities and have access to specified
non-public order information regarding
their DMM securities.7 However, the
Exchange states that DMMs do not have
a unique role or access to any nonpublic order information with respect to
securities that are not assigned to them
under Rule 103B. The Exchange
therefore believes that the current Rule
98 restrictions are unnecessarily broad.
Accordingly, the Exchange proposes
to amend Rule 98(c)(3)(B)(i) to provide
that, while on the Trading Floor,
employees of the DMM unit may trade
DMM securities only on or through the
systems and facilities of the Exchange at
the DMM unit’s assigned stock trading
post location and as permitted by
Exchange rules. Because the proposed
rule would no longer specify the only
securities that a DMM is permitted to
trade, the Exchange proposes to delete
are traded, which, for the purposes of the
Exchange’s Rules, is referred to as the ‘‘NYSE Amex
Options Trading Floor’’ or (ii) the physical area
within fully enclosed telephone booths located in
18 Broad Street at the Southeast wall of the Trading
Floor.
6 Rule 36.30 permits a DMM unit that is registered
in an Investment Company Unit (as defined in
Section 703.16 of the Listed Company Manual) or
a Trust Issued Receipt (as that term is defined in
Rule 1200) to use a telephone connection or order
entry terminal at the DMM unit’s post to enter
proprietary orders in the Unit or receipt in another
market center, in a Component Security of such a
Unit or receipt, or an options or futures contract
related to such Unit or receipt, and may use the
post telephone to obtain market information with
respect to such Units, receipts, options, futures or
Component Securities.
7 See, e.g., Rule 104(a) and (j).
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Agencies
[Federal Register Volume 82, Number 63 (Tuesday, April 4, 2017)]
[Notices]
[Pages 16456-16458]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-06566]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-80331; File No. SR-IEX-2017-08]
Self-Regulatory Organizations: Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Correct
Typographical Errors in SR-IEX-2017-06
March 29, 2017.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, on
March 17, 2017, the Investors Exchange LLC 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 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 (``IEX'' or ``Exchange'') is filing with the
Commission a proposed rule change to correct several typographical
errors in Rule 11.190(g)(1)(A) and in the Purpose Section of SR-IEX-
2017-06 describing the changes to IEX Rule 11.190(g)(1)(A) proposed
therein. The Exchange has designated this proposal as non-controversial
and has satisfied the requirements of 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 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 recently filed with the Commission an immediately
effective proposed rule change to amend Rule 11.190(g) to modify the
quote instability coefficients and quote instability threshold included
in the quote instability calculation specified in subparagraph (g)(1)
of Rule 11.190 for purposes of determining whether a crumbling quote
exists. The rule filing was published on the Commission Web site on
March 10, 2017.\7\ Thereafter the Exchange identified that the formula
contained in Rule 11.190(g)(1)(A) (the ``formula'') contains several
minor typographical errors. First, the numerical references to the
Quote Stability Coefficients contained in the formula were each
represented as regular text rather than as subscript, as they are
specified in subparagraph (a) of Rule 11.190(g)(1)(A). Second, the
Quote Stability Variables NC and FC are incorrectly represented as NC-1
and FC-1 respectively in the formula. Exhibit 5 to this filing corrects
both of these typographical errors. In addition, Exhibit 5 to SR-IEX-
2017-06 contains inconsistent notations on text marked for deletion and
retention whereby the same phrase is marked for deletion and also
marked as retained and relocated in the following subparagraph.
Specifically, the phrase ``the quote instability factor result from the
quote stability calculation is greater than the defined quote
instability threshold'' is not clearly shown as relocated. Exhibit 5 to
this rule filing corrects this typographical error by showing the text
of the relocated phrase as new text, notwithstanding that it was
previously contained in the text of Rule
[[Page 16457]]
1.190(g)(1)(A) [sic] as amended by SR-IEX-2017-06.
---------------------------------------------------------------------------
\7\ See Securities Exchange Act Release No. 34-80202; File No.
SR-IEX-2017-06.
---------------------------------------------------------------------------
In addition, the Purpose Section of the filing contains two sets of
typographical errors which the Exchange proposes to correct with this
filing. First, numbered paragraph 1, beginning on page 8, which
describes one aspect of the proposed amendments to Rule 11.190(g)
inadvertently omits the Nasdaq Stock Market in the list of exchanges
for which protected quotations are included in the Crumbling Quote
determination described in subparagraph (1) of Rule 11.190(g). This
paragraph also uses the word ``protection'' rather than ``protected''
in the second sentence. The proposed rule text in Exhibit 5 to the rule
filing is correct in this respect. Accordingly, IEX proposes to restate
the relevant portion of the Purpose Section to read as follows:
1. Rule 11.190(g) states that the Exchange utilizes real time
relative quoting activity of Protected Quotations, not including IEX
protected quotations, in the quote instability calculation. As
proposed, the Exchange is proposing to include the protected
quotations of the following exchanges in the quote instability
calculation: New York Stock Exchange, NYSE Arca, Nasdaq Stock
Market, Nasdaq BX, Bats BZX Exchange, Bats BYX Exchange, Bats EDGX
Exchange, and Bats EDGA Exchange. In connection with our analysis of
market data, as described above, the Exchange considered several
different permutations of which exchanges to include in the model.
The research identified that using the Protected Quotations of these
specific eight exchanges in the aggregate resulted in the greatest
predictive power of all permutations of exchanges assessed for
determining a crumbling quote.
Second, the description in the Purpose Section of the filing in the
first and third sentences of numbered paragraph 3 on page 10, which
reference the quote stability variables to be retired, incorrectly
format N-1 and F-1 in regular text, when the
numeral 1 and preceding minus sign in each should be subscript.
Accordingly, IEX proposes to restate the first three sentences of the
paragraph to read as follows:
The Exchange proposes to revise the quote stability variables
currently specified in subparagraph (1)(D)(i)(b) of Rule 11.190(g)
by adding seven (7) new variables (NC, FC, Delta, EPos, ENeg,
EPosPrev, and ENegPrev) and retiring four (4) variables
(N-1, F-1, E, and D). Specifically, based on
our analysis of market data, as described above, the Exchange
identified that considering the maximum change over the course of
the previous millisecond up to the most recent Protected NBBO change
was a more accurate indicator of a crumbling quote than simply
looking at the absolute state of the market one millisecond
previously. The replacement of N-1, F-1, and D
with NC, FC, and Delta, respectively, reflects this finding.''
(internal footnote omitted)
2. Statutory Basis
IEX believes that the proposed rule change is consistent with
Section 6(b) of the Act \8\ in general, and furthers the objectives of
Section 6(b)(5) of the Act,\9\ in particular, in that 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 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. Specifically, the correction
of inadvertent typographical errors in IEX Rule 11.190(g)(1)(A) and in
SR-IEX-2017-06 describing the changes to IEX Rule 11.190(g)(1)(A)
proposed therein will serve the goals of the Act by having rule text
accurately reflect system functionality and avoid the potential for
market participant confusion.
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\8\ 15 U.S.C. 78f.
\9\ 15 U.S.C. 78f(b)(5).
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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 believes that the
proposed correction does not impact competition in any respect since it
is designed to correct typographical errors.
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
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 \10\ and Rule 19b-4(f)(6) thereunder.\11\
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\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), IEX 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 under Rule 19b-4(f)(6) \12\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\13\ the Commission
may 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, noting that the
proposal would correct typographical errors in SR-IEX-2017-06, and
stating that waiver would allow the Exchange to implement these
corrections upon effectiveness of the proposal and avoid potential
confusion that otherwise might occur. The Commission believes that
waiver of the 30-day operative delay is consistent with the protection
of investors and the public interest because the proposed rule change
would correct a number of typographical errors contained in IEX's
recent SR-IEX-2017-06 filing, but would not result in any substantive
changes to that proposal. Waiver of the operative delay will allow IEX
to correct these errors without delay, which should reduce the
potential for confusion regarding the operation of IEX's quote
instability calculation referenced in IEX Rule 11.190. Therefore, the
Commission hereby waives the operative delay and designates the
proposed rule change operative upon filing.\14\
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\12\ 17 CFR 240.19b-4(f)(6).
\13\ 17 CFR 240.19b-4(f)(6)(iii).
\14\ 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 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.
[[Page 16458]]
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 SR-IEX-2017-08 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-2017-08. 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-IEX-2017-08 and should be
submitted on or before April 25, 2017.
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\15\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-06566 Filed 4-3-17; 8:45 am]
BILLING CODE 8011-01-P