Federal Register / Vol. 76, No. 49 / Monday, March 14, 2011 / Notices 13681 

17 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

5A Member is any registered broker or dealer that 

has been admitted to membership in the Exchange. 

6As defined in BYX Rule 11.9(c)(12). 

7As defined in BYX Rule 11.9(c)(8). 

8As defined in BYX Rule 11.9(c)(9). 

9As defined in BYX Rule 11.9(c)(11). 

10As defined in BYX Rule 11.9(c)(1). 

11As defined in BYX Rule 11.9(c)(10). 

12The Exchange’s routing strategies are described 

in Rule 11.13(a)(3). 

Internet Web site (http://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 

a.m. and 3 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–Phlx– 

2011–29 and should be submitted on or 

before April 4, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–5775 Filed 3–11–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64055; File No. SR–BYX– 

2011–005] 

Self-Regulatory Organizations; BATS 

Y-Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Related to Fees for Use 

of BATS Y-Exchange, Inc. 

March 8, 2011. 

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 February 

28, 2011, BATS Y-Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BYX’’) 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 

Exchange has designated the proposed 

rule change as one establishing or 

changing a member due, fee, or other 

charge imposed by the Exchange under 

Section 19(b)(3)(A)(ii) of the Act 3 and 

Rule 19b–4(f)(2) thereunder,4 which 

renders the proposed rule change 

effective upon filing with the 

Commission. 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 the Substance 

of the Proposed Rule Change 

The Exchange proposes to amend the 

fee schedule applicable to Members 5 of 

the Exchange pursuant to BYX Rules 

15.1(a) and (c). While changes to the fee 

schedule pursuant to this proposal will 

be effective upon filing, the changes will 

become operative on March 1, 2011. The 

text of the proposed rule change is 

available at the Exchange’s Web site at 

http://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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to modify its 

fee schedule applicable to use of the 

Exchange effective March 1, 2011, in 

order to: (i) Amend the liquidity fees for 

adding liquidity, including increased 

fees to add non-displayed liquidity and 

adoption of a fee to add displayed 

liquidity unless a Member has an 

average daily volume of 10 million 

shares or more added per day in a given 

month; (ii) reduce certain standard 

routing fees; and (iii) expand the 

Exchange’s Discounted Destination 

Specific Routing program to include a 

rebate for Destination Specific Orders 6

routed to EDGA Exchange. 

(i) Amending the Liquidity Fees for 

Adding Liquidity 

The Exchange has not previously 

provided any rebate or imposed any 

charge for adding displayed liquidity to 

the BYX order book in securities priced 

$1.00 and above. The Exchange 

proposes to introduce a tiered pricing 

structure applicable to added displayed 

liquidity in securities priced $1.00 and 

above, under which Members adding a 

daily average of 10 million shares or 

more of liquidity (including displayed 

and non-displayed liquidity) during a 

month will continue to be able to add 

displayed liquidity without charge, 

while Members adding a daily average 

of less than 10 million shares of 

liquidity during a month will be 

charged $0.0002 per share. Thus, while 

the fee change will result in a small fee 

increase for Members providing low 

volumes of liquidity on BYX, it will 

remain unchanged for Members 

providing higher volumes of liquidity. 

The Exchange also proposes to 

increase its fee to add non-displayed 

liquidity to the BYX order book in 

securities priced $1.00 and above from 

a charge of $0.0005 per share to a charge 

of $0.0010 per share. As defined on the 

BYX fee schedule, the reference to ‘‘nondisplayed liquidity’’ for purposes of the 

fee schedule includes liquidity resulting 

from all forms of Pegged Orders,7 MidPoint Peg Orders,8 and Non-Displayed 

Orders,9 but does not include liquidity 

resulting from Reserve Orders 10 or 

Discretionary Orders.11

The Exchange does not propose to 

change its pricing structure for added 

liquidity in securities priced below 

$1.00. 

(ii) Reduced Standard Routing Fees 

The Exchange proposes to reduce the 

fee that it charges for certain of its 

standard best execution routing 

strategies. The Exchange currently offers 

the Parallel D, Parallel 2D, CYCLE and 

RECYCLE routing strategies at a charge 

of $0.0028 per share for executions that 

occur at other trading venues as a result 

of such strategies in securities priced 

$1.00 and above.12 The Exchange 

proposes to reduce the fee for use of 

such strategies to a charge of $0.0026 

per share to in order to encourage use 

mstockstill on DSKH9S0YB1PROD with NOTICES

13682 Federal Register / Vol. 76, No. 49 / Monday, March 14, 2011 / Notices 

13 15 U.S.C. 78f. 

14 15 U.S.C. 78f(b)(4). 

15 15 U.S.C. 78s(b)(3)(A)(ii). 

16 17 CFR 240.19b–4(f)(2). 

of these strategies. To be consistent with 

this change, the Exchange proposes to 

charge 0.26%, rather than 0.28%, of the 

total dollar value of the executions at 

other trading venues as a result of 

Parallel D, Parallel 2D, CYCLE and 

RECYCLE in securities priced under 

$1.00 per share. 

(iii) Destination Specific Routing to 

EDGA Exchange 

The Exchange currently provides a 

discounted fee for Destination Specific 

Orders routed to certain market centers 

(NYSE, NYSE Arca and NASDAQ), 

which, in each instance is $0.0001 less 

per share for orders routed to such 

market centers by the Exchange than 

such market centers currently charge for 

removing liquidity (referred to by the 

Exchange as ‘‘One Under’’ pricing). 

Consistent with this program, the 

Exchange proposes to adopt pricing for 

Destination Specific Orders routed to 

EDGA Exchange. Specifically, the 

Exchange proposes to provide a rebate 

of $0.00025 per share for BYX + EDGA 

Destination Specific Orders executed at 

EDGA, which is $0.0001 higher per 

share than the $0.00015 per share rebate 

provided by EDGA for orders that 

remove liquidity. 

The Exchange imposes a charge of 

$0.0030 per share for Destination 

Specific Orders sent to and executed by 

any market center for which it does not 

have any separately identified pricing. 

Based on the change described above, 

the Exchange proposes to add EDGA to 

the list of market centers to which this 

charge does not apply. 

Consistent with the changes described 

above, the Exchange proposes to change 

the title of its Discounted Destination 

Specific Routing section to refer to the 

program as ‘‘One Under/Better,’’ rather 

than ‘‘One Under,’’ and to add reference 

to EDGA. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the requirements of the Act and the 

rules and regulations thereunder that 

are applicable to a national securities 

exchange, and, in particular, with the 

requirements of Section 6 of the Act.13

Specifically, the Exchange believes that 

the proposed rule change is consistent 

with Section 6(b)(4) of the Act,14 in that 

it provides for the equitable allocation 

of reasonable dues, fees and other 

charges among members and other 

persons using any facility or system 

which the Exchange operates or 

controls. The Exchange notes that it 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive. The 

Exchange believes that its fees and 

credits are competitive with those 

charged by other venues. 

While the establishment of tiered 

pricing for adding displayed liquidity to 

the Exchange’s order book will result in 

a small increase in fees for some 

Members, this fee still remains lower 

than other markets that impose a fee to 

add liquidity, such as EDGA Exchange 

and NASDAQ OMX BX. Similarly, 

while the Exchange’s proposal to 

increase the fee to add non-displayed 

liquidity to the Exchange will result in 

an increase in fees for Members that add 

non-displayed liquidity, this fee is 

lower than the fee to add liquidity 

(whether displayed or non-displayed) to 

NASDAQ OMX BX. As it relates to its 

differentiation between displayed and 

non-displayed liquidity, the Exchange 

believes that a fee structure that 

provides greater incentives to add 

displayed liquidity than incentives to 

add non-displayed liquidity is fair and 

reasonable. In addition, to the extent the 

proposed changes will result in 

increased fees charged to Members, the 

Exchange believes that any additional 

revenue it receives will allow the 

Exchange to devote additional capital to 

its operations and to continue to offer 

competitive pricing, which, in turn, will 

benefit Members of the Exchange. 

The reduction of the routing fee for 

several of the BYX standard routing 

options and the adoption of new pricing 

for a Destination Specific Order that 

offers improvement of the execution 

rebate offered by another market center 

are changes intended to attract order 

flow to BYX by offering competitive 

rates to Exchange Members for strategies 

that first check the BYX order book 

before routing to away venues. 

Accordingly, the Exchange’s proposal 

will result in reduced fees that will 

benefit Members due to the obvious 

economic savings those Members will 

receive and the potential of increased 

available liquidity at the Exchange. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change imposes any 

burden on competition. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Pursuant to Section 19(b)(3)(A)(ii) of 

the Act 15 and Rule 19b–4(f)(2) 

thereunder,16 the Exchange has 

designated this proposal as establishing 

or changing a due, fee, or other charge 

applicable to its members, which 

renders the proposed rule change 

effective upon filing. 

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. 

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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–BYX–2011–005 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–BYX–2011–005. This file 

number should be included on the 

subject line if e-mail 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 website (http://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 

mstockstill on DSKH9S0YB1PROD with NOTICES

Federal Register / Vol. 76, No. 49 / Monday, March 14, 2011 / Notices 13683 

17 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2The Commission has modified the text of the 

summaries prepared by FICC. 

3MBSD also executes an evening pass (also 

referred to as the ‘‘PM Pass’’) at 8 p.m. (EST) that 

will remain unchanged. On days where MBSD 

executes its TBA Netting cycle, it immediately 

follows the completion of the morning pass. 

4 15 U.S.C. 78q–1. 

5 15 U.S.C. 78s(b)(3)(A)(iii). 

6 17 CFR 240.19b–4(f)(4). 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room on official business 

days between the hours of 10 a.m. and 

3 p.m. Copies of such filing also will be 

available for inspection and copying at 

the principal offices 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–BYX–2011–005, and should 

be submitted on or before April 4, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–5774 Filed 3–11–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64053; File No. SR–FICC– 

2011–01] 

Self-Regulatory Organizations; The 

Fixed Income Clearing Corporation; 

Notice of Filing and Immediate 

Effectiveness of a Proposed Rule 

Change To Notify Participants That the 

Mortgage Backed Securities Division 

Intends To Move the Time at Which It 

Runs Its Daily Morning Pass 

March 8, 2011. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 notice is hereby given that on 

March 2, 2011, the Fixed Income 

Clearing Corporation (‘‘FICC’’) 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 primarily by FICC. The 

Commission is publishing this notice to 

solicit comments from interested 

persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The purpose of the proposed rule 

change is to notify participants that the 

Mortgage Backed Securities Division 

(‘‘MBSD’’) intends to move the time at 

which it runs its daily morning pass 

(also referred to as the ‘‘AM Pass’’) from 

10:30 a.m. to 2 p.m. (EST). 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

FICC 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. FICC has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of such statements.2

(A) Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

The purpose of this filing is to notify 

participants that MBSD intends to move 

the time at which it runs its daily 

morning pass from 10:30 a.m. to 2 p.m. 

(EST).3 The proposed change to 2 p.m. 

for the morning pass will allow more 

trades to be included into the TBA Net 

and therefore will assist in reducing the 

amount of fails in the market in addition 

to reducing the related operational risk. 

The above change is being made at the 

request of The Securities Industry and 

Financial Markets Association 

(‘‘SIFMA’’) MBS Operations Committee. 

In addition, MBSD reviewed the 

potential change with member firms not 

represented on the SIFMA Committee, 

and no objections were raised. 

The effective date of this change will 

be announced to MBSD participants by 

Important Notice. 

FICC believes that the proposed rule 

change is consistent with the 

requirements of Section 17A of the Act 4

and the rules and regulations 

thereunder applicable to FICC because it 

should provide for the prompt and 

accurate clearance and settlement of 

securities transactions by including a 

greater proportion of transactions in the 

TBA netting cycle. Additionally, the 

proposed rule change should result in 

fewer fails, and reduced operational 

risk. 

(B) Self-Regulatory Organization’s 

Statement on Burden on Competition 

FICC does not believe that the 

proposed rule change will have any 

impact on or impose any burden on 

competition. 

(C) Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments relating to the 

proposed rule change have been 

solicited or received. FICC will notify 

the Commission of any written 

comments received by FICC. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective upon filing pursuant to Section 

19(b)(3)(A)(iii) of the Act 5 and Rule 

19b–4(f)(4) 6 thereunder because the 

proposed rule effects a change in an 

existing service that (i) does not 

adversely affect the safeguarding of 

securities or funds in the custody or 

control of FICC or for which it is 

responsible and (ii) does not 

significantly affect the respective rights 

or obligations of FICC or persons using 

the service. At any time within sixty 

days of the filing of such 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. 

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 (http://www.sec.gov/ 

rules/sro.shtml) or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–FICC–2011–01 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–FICC–2011–01. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

mstockstill on DSKH9S0YB1PROD with NOTICES