Federal Register / Vol. 76, No. 158 / Tuesday, August 16, 2011 / Notices 50779 

16 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

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 

No. SR–NSX–2011–08 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 No. 

SR–NSX–2011–08. 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 No. SR–NSX–2011– 

08 and should be submitted on or before 

September 6, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.16

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20736 Filed 8–15–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65094; File No. SR– 

NASDAQ–2011–11] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Extend the 

Pilot Period of the Trading Pause for 

NMS Stocks 

August 10, 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 August 8, 

2011, The NASDAQ Stock Market LLC 

(‘‘Exchange’’), filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to extend the 

pilot period of the trading pause for 

individual stocks contained in the 

Standard & Poor’s 500 Index, Russell 

1000 Index, and specified Exchange 

Traded Products that experience a price 

change of 10% or more during a fiveminute period, so that the pilot will 

now expire on January 31, 2012. 

The text of the proposed rule change 

is below. Proposed new language is 

italicized; proposed deletions are in 

brackets. 

* * * * * 

4120. Trading Halts 

(a) Authority to Initiate Trading Halts 

or Pauses 

In circumstances in which Nasdaq 

deems it necessary to protect investors 

and the public interest, Nasdaq, 

pursuant to the procedures set forth in 

paragraph (c): 

(1)–(10) No change. 

(11) Shall, between 9:45 a.m. and 3:35 

p.m., or in the case of an early 

scheduled close, 25 minutes before the 

close of trading, immediately pause 

trading for 5 minutes in any Nasdaqlisted security when the price of such 

security moves a percentage specified 

below within a 5-minute period. 

(A) The price move shall be 10% or 

more with respect to securities included 

in the S&P 500® Index, Russell 1000® 

Index, and a pilot list of Exchange 

Traded Products; 

(B) The price move shall be 30% or 

more with respect to all NMS stocks not 

subject to section (a)(i) of this Rule with 

a price equal to or greater than $1; and 

(C) The price move shall be 50% or 

more with respect to all NMS stocks not 

subject to section (a)(i) of this Rule with 

a price less than $1. 

The determination that the price of a 

stock is equal to or greater than $1 

under paragraph (a)(11)(B) above or less 

than $1 under paragraph (a)(11)(C) 

above shall be based on the closing 

price on the previous trading day, or, if 

no closing price exists, the last sale 

reported to the Consolidated Tape on 

the previous trading day. 

At the end of the trading pause, 

Nasdaq will re-open the security using 

the Halt Cross process set forth in 

Nasdaq Rule 4753. In the event of a 

significant imbalance at the end of a 

trading pause, Nasdaq may delay the reopening of a security. 

Nasdaq will issue a notification if it 

cannot resume trading for a reason other 

than a significant imbalance. 

Price moves under this paragraph will 

be calculated by changes in each 

consolidated last-sale price 

disseminated by a network processor 

over a five minute rolling period 

measured continuously. Only regular 

way in-sequence transactions qualify for 

use in calculations of price moves. 

Nasdaq can exclude a transaction price 

from use if it concludes that the 

transaction price resulted from an 

erroneous trade. 

If a trading pause is triggered under 

this paragraph, Nasdaq shall 

immediately notify the single plan 

processor responsible for consolidation 

of information for the security pursuant 

to Rule 603 of Regulation NMS under 

the Securities Exchange Act of 1934. If 

a primary listing market issues an 

individual stock trading pause, Nasdaq 

will pause trading in that security until 

trading has resumed on the primary 

listing market or notice has been 

received from the primary listing market 

that trading may resume. If the primary 

listing market does not reopen within 10 

minutes of notification of a trading 

pause, Nasdaq may resume trading the 

security. 


emcdonald on DSK2BSOYB1PROD with NOTICES
50780 Federal Register / Vol. 76, No. 158 / Tuesday, August 16, 2011 / Notices 

3See Securities Exchange Act Release No. 62252 

(June 10, 2010), 75 FR 34186 (June 16, 2010) (SR– 

NASDAQ–2010–061). 

4The term ‘‘Listing Markets’’ refers collectively to 

NYSE, NYSE Amex, NYSE Arca, and the Exchange. 

5See Securities Exchange Act Release No. 62884 

(September 10, 2010), 75 FR 56618 (September 16, 

2010) (SR–NASDAQ–2010–079). 

6See Securities Exchange Act Release No. 63505 

(December 9, 2010), 75 FR 78302 (December 15, 

2010) (SR–NASDAQ–2010–162). 

7See Securities Exchange Act Release No. 64174 

(April 4, 2011), 76 FR 19819 (April 8, 2011) (SR– 

NASDAQ–2011–042). 

8See Securities Exchange Act Release No. 64735 

(June 23, 2011), 76 FR 38243 (June 29, 2011) (SR– 

NASDAQ–2011–067, et al.). 

9 15 U.S.C. 78f(b)(5). 

10 15 U.S.C. 78k–1(a)(1). 

11 15 U.S.C. 78s(b)(3)(A)(iii). 

12 17 CFR 240.19b–4(f)(6). 

13 15 U.S.C. 78s(b)(3)(A). 

14 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires the Exchange to give the 

Commission written notice of the Exchange’s intent 

to file the proposed rule change along with a brief 

description and 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. The Exchange 

has satisfied this requirement. 

15 17 CFR 240.19b–4(f)(6). 

16 17 CFR 240.19b–4(f)(6)(iii). 

The provisions of this paragraph shall 

be in effect during a pilot set to end on 

[the earlier of ]January 31, 2012[August 

11, 2011 or the date on which a limit 

up/limit down mechanism to address 

extraordinary market volatility, if 

adopted, applies]. 

* * * * * 

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 aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

On June 10, 2010, the Commission 

granted accelerated approval, for a pilot 

period to end December 10, 2010, for a 

proposed rule change submitted by the 

Exchange, together with related rule 

changes of the BATS Exchange, Inc., 

NASDAQ OMX BX, Inc., Chicago Board 

Options Exchange, Incorporated, 

Chicago Stock Exchange, Inc., EDGA 

Exchange, Inc., EDGX Exchange, Inc., 

International Securities Exchange LLC, 

New York Stock Exchange LLC 

(‘‘NYSE’’), NYSE Amex LLC (‘‘NYSE 

Amex’’), NYSE Arca, Inc. (‘‘NYSE 

Arca’’), and National Stock Exchange, 

Inc. (collectively, the ‘‘Exchanges’’), to 

pause trading during periods of 

extraordinary market volatility in S&P 

500 stocks.3 The rules require the 

Listing Markets 4 to issue five-minute 

trading pauses for individual securities 

for which they are the primary Listing 

Market if the transaction price of the 

security moves ten percent or more from 

a price in the preceding five-minute 

period. The Listing Markets are required 

to notify the other Exchanges and 

market participants of the imposition of 

a trading pause by immediately 

disseminating a special indicator over 

the consolidated tape. Under the rules, 

once the Listing Market issues a trading 

pause, the other Exchanges are required 

to pause trading in the security on their 

markets. On September 10, 2010, the 

Commission approved the respective 

rule filings of the Exchanges to expand 

application of the pilot to the Russell 

1000® Index and specified Exchange 

Traded Products.5 On December 7, 

2010, the Exchange filed an 

immediately effective filing to extend 

the existing pilot program for four 

months, so that the pilot would expire 

on April 11, 2011.6 On March 31, 2011, 

the Exchange filed an immediately 

effective filing to extend the pilot period 

an additional four months, so that the 

pilot would expire on August 11, 2011 

or the date on which a limit up/limit 

down mechanism to address 

extraordinary market volatility, if 

adopted, applies.7 On June 23, 2011, the 

Commission approved the expansion of 

the pilot to all NMS stocks, but with 

different pause-triggering thresholds.8

The Exchange believes that the pilot 

program has been successful in reducing 

the negative impacts of sudden, 

unanticipated price movements in the 

securities covered by the pilot. The 

Exchange also believes that an 

additional extension of the pilot is 

warranted so that it may continue to 

assess whether circuit breakers are the 

best means to reduce the negative 

impacts of sudden, unanticipated price 

movements or whether alternative 

mechanisms would be more effective in 

achieving this goal. 

Accordingly, the Exchange is filing to 

further extend the pilot program until 

January 31, 2012 and remove language 

from the rule concerning the ‘‘limit up/ 

limit down’’ mechanism. 

2. Statutory Basis 

The statutory basis for the proposed 

rule change is Section 6(b)(5) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),9 which requires the rules of an 

exchange 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 proposed rule 

change also is designed to support the 

principles of Section 11A(a)(1) 10 of the 

Act in that it seeks to assure fair 

competition among brokers and dealers 

and among exchange markets. The 

Exchange believes that the proposed 

rule meets these requirements in that it 

promotes transparency and uniformity 

across markets concerning decisions to 

pause trading in a security when there 

are significant price movements. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange 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, as amended. 

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 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 13 and Rule 19b–4(f)(6)(iii) 

thereunder.14

A proposed rule change filed under 

Rule 19b–4(f)(6) 15 normally does not 

become operative for 30 days after the 

date of filing. However, pursuant to 

Rule 19b–4(f)(6)(iii) 16 the Commission 

may designate a shorter time if such 

action is consistent with the protection 

of investors and the public interest. The 


emcdonald on DSK2BSOYB1PROD with NOTICES
Federal Register / Vol. 76, No. 158 / Tuesday, August 16, 2011 / Notices 50781 

17For 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 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

Exchange has asked the Commission to 

waive the 30-day operative delay so that 

the proposal may become operative 

immediately upon filing. 

The Commission believes that 

waiving the 30-day operative delay is 

consistent with the protection of 

investors and the public interest, as it 

will allow the pilot program to continue 

uninterrupted, thereby avoiding the 

investor confusion that could result 

from a temporary interruption in the 

pilot program. For this reason, the 

Commission designates the proposed 

rule change as 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. 

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 

No. SR–NASDAQ–2011–115 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 No. 

SR–NASDAQ–2011–115. 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 No. SR–NASDAQ– 

2011–115 and should be submitted on 

or before September 6, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.18

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20735 Filed 8–15–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65093; File No. SR–BX– 

2011–055] 

Self-Regulatory Organizations; 

NASDAQ OMX BX, Inc.; Notice of Filing 

and Immediate Effectiveness of 

Proposed Rule Change To Extend the 

Pilot Period of the Trading Pause for 

NMS Stocks 

August 10, 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 August 8, 

2011, NASDAQ OMX BX, Inc. 

(‘‘Exchange’’), filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to extend the 

pilot period of the trading pause for 

individual stocks contained in the 

Standard & Poor’s 500 Index, Russell 

1000 Index, and specified Exchange 

Traded Products that experience a price 

change of 10% or more during a fiveminute period, so that the pilot will 

now expire on January 31, 2012. 

The text of the proposed rule change 

is below. Proposed new language is 

italicized; proposed deletions are in 

brackets. 

* * * * * 

IM–4120–3. Circuit Breaker Securities 

Pilot 

The provisions of paragraph (a)(11) of 

this Rule shall be in effect during a pilot 

set to end on [the earlier of] January 31, 

2012 [August 11, 2011 or the date on 

which a limit up/limit down 

mechanism to address extraordinary 

market volatility, if adopted, applies]. 

During the pilot, the term ‘‘Circuit 

Breaker Securities’’ shall mean all NMS 

stocks. 

* * * * * 

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 aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

On June 10, 2010, the Commission 

granted accelerated approval, for a pilot 

period to end December 10, 2010, for a 

proposed rule change submitted by the 

Exchange, together with related rule 

changes of the BATS Exchange, Inc., 

Chicago Board Options Exchange, 

Incorporated, Chicago Stock Exchange, 

Inc., EDGA Exchange, Inc., EDGX 

Exchange, Inc., International Securities 

Exchange LLC, The NASDAQ Stock 

Market LLC (‘‘NASDAQ’’), New York 

Stock Exchange LLC (‘‘NYSE’’), NYSE 

Amex LLC (‘‘NYSE Amex’’), NYSE Arca, 


emcdonald on DSK2BSOYB1PROD with NOTICES