Federal Register / Vol. 76, No. 63 / Friday, April 1, 2011 / Notices 18283 

13See, e.g., BOX Rule Section 18 ‘‘The Price 

Improvement Period’’ and ISE Rule 723 ‘‘Price 

Improvement Mechanism for Crossing 

Transactions’’ (both of which providing a 

mechanism for options members that want to 

internalize customer orders the ability to do so on 

the exchanges subject to a requirement that such 

orders first be exposed to all other options members 

through a brief price improvement auction). 

14 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

has implicitly approved such processes 

in the options markets by allowing 

certain price improvement auctions to 

exist pursuant to pilot programs, which 

auctions provide the ability of an 

options member to submit a customer 

order along with a contra-side principal 

order from the options member into a 

brief price improvement auction in 

which all members have the ability to 

compete for the execution.13 BATS’ 

proposed rule changes are similar in 

nature to these price improvement 

auctions, except that under BATS’ 

proposal, competition for the execution 

with a Directed Order occurs in the 

context of BATS’ continuous, price/time 

priority auction, rather than during a 

separate, one-second price improvement 

auction. As such, concerns about 

customer orders potentially ‘‘missing the 

market’’ during that exposure period are 

not present. That said, however, BATS 

has proposed to the Commission price 

improvement data and other data 

deemed necessary to evaluate the 

impact of the proposal. Also, as 

previously mentioned, BATS’ proposal 

differs from existing price improvement 

auctions due to the fact that BATS 

Options Market Makers would have no 

participation guarantees. 

The Exchange notes market makers 

already retain the discretion to pay 

certain firms non-transparent payment 

for order flow amounts. The proposal 

similarly retains that existing discretion 

for market makers, but provides a 

mechanism for such payments, or at 

least a portion of such payments, to be 

provided in a transparent fashion to the 

Directed Order in the form of price 

improvement over the NBBO. 

(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 

The Exchange has neither solicited 

nor received written comments on the 

proposed rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 45 days of the date of 

publication of this notice in the Federal 

Register or within such longer period 

up to 90 days (i) as the Commission may 

designate if it finds such longer period 

to be appropriate and publishes its 

reasons for so finding or (ii) as to which 

the self-regulatory organization 

consents, the Commission will: 

(A) By order approve or disapprove 

the proposed rule change, or 

(B) Institute proceedings to determine 

whether the proposed rule change 

should be 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, as modified by Amendment 

No.1, 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–BATS–2011–009 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–BATS–2011–009. 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 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 such 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–BATS– 

2011–009 and should be submitted on 

or before April 22, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–7688 Filed 3–31–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64130; File No. SR– 

NYSEAmex–2011–17] 

Self-Regulatory Organizations; NYSE 

Amex LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Deleting Rule 346—NYSE 

Amex Equities and Adopting New Rule 

3270—NYSE Amex Equities To 

Correspond With Rule Changes Filed 

by the Financial Industry Regulatory 

Authority, Inc. 

March 28, 2011. 

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 March 14, 

2011, NYSE Amex LLC (the ‘‘SRO’’ or 

‘‘NYSE Amex’’) filed with the Securities 

and Exchange Commission (the 

‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

substantially prepared by the SRO. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The SRO proposes to delete Rule 

346—NYSE Amex Equities and adopt 

new Rule 3270—NYSE Amex Equities 

to correspond with rule changes filed by 

the Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) and approved 

by the Securities and Exchange 

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18284 Federal Register / Vol. 76, No. 63 / Friday, April 1, 2011 / Notices 

4See Securities Exchange Act Release No. 62762 

(August 23, 2010), 75 FR 53362 (August 31, 2010) 

(approval order). 

5See Securities Exchange Act Release Nos. 56148 

(July 26, 2007), 72 FR 42146 (August 1, 2007) (order 

approving the Agreement); 56147 (July 26, 2007), 72 

FR 42166 (August 1, 2007) (SR–NASD–2007–054) 

(order approving the incorporation of certain NYSE 

Rules as ‘‘Common Rules’’); and 60409 (July 30, 

2009), 74 FR 39353 (August 6, 2009) (order 

approving the amended and restated Agreement, 

adding NYSE Amex LLC as a party). Paragraph 2(b) 

of the Agreement sets forth procedures regarding 

proposed changes by FINRA, NYSE or NYSE Amex 

to the substance of any of the Common Rules. 

6FINRA’s rulebook currently has three sets of 

rules: (1) NASD Rules, (2) FINRA Incorporated 

NYSE Rules, and (3) consolidated FINRA Rules. 

The FINRA Incorporated NYSE Rules apply only to 

those members of FINRA that are also members of 

the NYSE (‘‘Dual Members’’), while the consolidated 

FINRA Rules apply to all FINRA members. For 

more information about the FINRA rulebook 

consolidation process, see FINRA Information 

Notice, March 12, 2008. 

7See fn. 4. 

8The NYSE has submitted a companion rule 

filing amending its rules in accordance with 

FINRA’s rule changes. See SR–NYSE–2011–12. 

9 15 U.S.C. 78f(b). 

10 15 U.S.C. 78f(b)(5). 11 15 U.S.C. 78s(b)(3)(A)(iii). 12 17 CFR 240.19b–4(f)(6). 13 17 CFR 240.19b–4(f)(6). 

Commission (the ‘‘Commission’’).4 The 

text of the proposed rule change is 

available at the NYSE Amex, at the 

Commission’s Public Reference Room, 

and on NYSE Amex’s Web site at 

http://www.nyse.com. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

NYSE Amex 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 those 

statements may be examined at the 

places specified in Item IV below. The 

SRO 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 purpose of the proposed rule 

change, to delete Rule 346—NYSE 

Amex Equities (Limitations— 

Employment and Association with 

Members and Member Organizations) 

and adopt new Rule 3270—NYSE Amex 

Equities (Outside Business Activities of 

Registered Persons), is to correspond 

with rule changes filed by FINRA and 

approved by the Commission. 

Background 

On July 30, 2007, FINRA’s 

predecessors, the National Association 

of Securities Dealers, Inc. (‘‘NASD’’) and 

NYSE Regulation, Inc. (‘‘NYSER’’), 

consolidated their member firm 

regulation operations into a combined 

organization, FINRA. Pursuant to Rule 

17d–2 under the Securities Exchange 

Act of 1934, as amended (the ‘‘Act’’), the 

New York Stock Exchange LLC 

(‘‘NYSE’’), NYSER and FINRA entered 

into an agreement (the ‘‘Agreement’’) to 

reduce regulatory duplication for their 

members by allocating to FINRA certain 

regulatory responsibilities for certain 

NYSE rules and rule interpretations 

(‘‘FINRA Incorporated NYSE Rules’’). 

The SRO became a party to the 

Agreement effective December 15, 

2008.5

As part of its effort to reduce 

regulatory duplication and relieve firms 

that are members of FINRA, NYSE and 

NYSE Amex of conflicting or 

unnecessary regulatory burdens, FINRA 

is now engaged in the process of 

reviewing and amending the NASD and 

FINRA Incorporated NYSE Rules in 

order to create a consolidated FINRA 

rulebook.6

Proposed Conforming Amendments to 

NYSE Amex Equities Rules 

FINRA adopted NASD Rule 3030 

(Outside Business Activities of an 

Associated Person), which prohibits any 

registered person from being employed 

by or accepting any compensation from 

any person as a result of any outside 

business activity, other than passive 

investments, unless he has provided 

prompt written notice to his member 

firm, as consolidated FINRA Rule 3270 

requires, subject to certain 

modifications. FINRA also deleted 

Incorporated NYSE Rule 346 as it is 

substantially similar to consolidated 

FINRA Rule 3270.7

To harmonize the NYSE Amex 

Equities Rules with the approved 

consolidated FINRA Rules, the SRO 

correspondingly proposes to delete Rule 

346—NYSE Amex Equities and replace 

it with proposed Rule 3270—NYSE 

Amex Equities, which is substantially 

similar to the new FINRA Rule.8 As 

proposed, Rule 3270—NYSE Amex 

Equities adopts the same language as 

FINRA Rule 3270, except for 

substituting for or adding to, as needed, 

the term ‘‘member organization’’ for the 

term ‘‘member,’’ and making 

corresponding technical changes. 

2. Statutory Basis 

The SRO believes that the proposed 

rule changes are consistent with the 

provisions of Section 6(b) of the Act,9 in 

general, and further the objectives of 

Section 6(b)(5) of the Act,10 in 

particular, in that they are designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade, to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest. 

The SRO believes that the proposed 

rule changes support the objectives of 

the Act by providing greater 

harmonization between NYSE Amex 

Equities Rules and FINRA Rules 

(including Common Rules) of similar 

purpose, resulting in less burdensome 

and more efficient regulatory 

compliance for Dual Members. To the 

extent the SRO has proposed changes 

that differ from the FINRA version of 

the Rules, such changes are technical in 

nature and do not change the substance 

of the proposed NYSE Amex Equities 

Rules. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The SRO does not believe that the 

proposed rule change will impose any 

burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended. 

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 by the SRO with respect to 

the proposed rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The SRO has filed the proposed rule 

change pursuant to Section 

19(b)(3)(A)(iii) of the Act 11 and Rule 

19b–4(f)(6) thereunder.12 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 

prior to 30 days from the date on which 

it was filed, or such shorter time as the 

Commission may designate, if 

consistent with the protection of 

investors and the public interest, the 

proposed rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act and Rule 19b–4(f)(6)(iii) 

thereunder. 

A proposed rule change filed under 

Rule 19b–4(f)(6) 13 normally does not 

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Federal Register / Vol. 76, No. 63 / Friday, April 1, 2011 / Notices 18285 

14 17 CFR 240.19b–4(f)(6)(iii). 

15See fn. 4. 

16See Securities Exchange Act Release No. 58092 

(July 3, 2008), 73 FR 40143 (July 11, 2008) 

(concerning 17 CFR 200 and 241). 

17As provided in paragraph 2(b) of the 

Agreement, FINRA and NYSE will amend the list 

of Common Rules to conform to the rule changes 

proposed herein. See fn. 5. 

18For purposes of waiving the 30-day operative 

delay, the Commission has considered the proposed 

rule change’s impact on efficiency, competition, 

and capital formation. 15 U.S.C. 78c(f). 

19 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See Securities Exchange Act Release No. 62762 

(August 23, 2010), 75 FR 53362 (August 31, 2010) 

(approval order). 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b–4(f)(6)(iii),14 the 

Commission may designate a shorter 

time if such action is consistent with the 

protection of investors and the public 

interest. The SRO has asked the 

Commission to waive the 30-day 

operative delay so that the proposal may 

become operative immediately upon 

filing. 

The SRO believes that this filing is 

non-controversial because it raises no 

novel issues and is consistent with the 

FINRA rule filing previously approved 

by the Commission on which it is 

based.15 In particular, the purpose of the 

proposed rule changes is to conform the 

NYSE Amex Equities Rules to FINRA’s 

adoption of consolidated FINRA Rule 

3270 in furtherance of the consolidation 

of the member firm regulation functions 

of NYSER and FINRA. Except as 

specifically noted, and subject to such 

technical changes as are necessary to 

apply the Rule to the SRO, NYSE Amex 

proposes to adopt the rule changes in 

the form that they were approved by the 

Commission for FINRA. Accordingly, 

the SRO believes that these rule changes 

are eligible for immediately effective 

treatment under the Commission’s 

current procedures for processing rule 

filings.16 The SRO requested an 

accelerated operative date for the 

proposed rule changes in order to avoid 

regulatory gaps between the FINRA and 

NYSE Amex Equity Rules and to further 

ensure that, as applicable, the NYSE 

Amex Equity Rules maintain their status 

as Common Rules under the 

Agreement.17 The Commission believes 

it is consistent with the protection of 

investors and the public interest to 

waive the 30-day operative delay for 

this reason, and hereby grants such a 

waiver.18

At any time within 60 days of the 

filing of such proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. 

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–NYSEAmex–2011–17 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–NYSEAmex–2011–17. 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 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 Section, 100 F Street, NE., 

Washington, DC 20549–1090. Copies of 

the filing will also be available for 

inspection and copying at the NYSE’s 

principal office and on its Internet Web 

site at http://www.nyse.com. 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–NYSEAmex–2011–17 and 

should be submitted on or before April 

22, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–7651 Filed 3–31–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–64131; File No. SR–NYSE– 

2011–12] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Deleting NYSE 

Rule 346 and Adopting New Rule 3270 

To Correspond With Rule Changes 

Filed by the Financial Industry 

Regulatory Authority, Inc. 

March 28, 2011. 

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 March 14, 

2011, New York Stock Exchange LLC 

(‘‘NYSE’’ or the ‘‘SRO’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

substantially prepared by the SRO. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The SRO proposes to delete NYSE 

Rule 346 and adopt new Rule 3270 to 

correspond with rule changes filed by 

the Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) and approved 

by the Securities and Exchange 

Commission (the ‘‘Commission’’).4 The 

text of the proposed rule change is 

available at the NYSE, at the 

Commission’s Public Reference Room, 

and on NYSE’s Web site at http:// 

www.nyse.com. 

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 

NYSE included statements concerning 

the purpose of, and basis for, the 

mstockstill on DSKH9S0YB1PROD with NOTICES