51094 Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 

14 15 U.S.C. 78f(b)(5). 15 15 U.S.C. 78k–1(a)(1). 16 15 U.S.C. 78s(b)(3)(A). 17 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule 

19b–4(f)(6)(iii) requires that a self-regulatory 

organization submit to the Commission written 

notice of its 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 filing of the proposed rule change, or 

such shorter time as designated by the Commission. 

The Commission is waiving the five day written 

notice requirement in this case. Therefore, the 

Commission notes that the Exchange has satisfied 

this requirement. 

18For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

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

19 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

the proposed change is consistent with 

Section 6(b)(5) of the Act,14 because it 

would promote just and equitable 

principles of trade, remove 

impediments to, and perfect the 

mechanism of, a free and open market 

and a national market system, and, in 

general, protect investors and the public 

interest. The proposed rule change is 

also designed to support the principles 

of Section 11A(a)(1) 15 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 reviews of 

potentially clearly erroneous executions 

in various contexts, including reviews 

in the context of a Multi-Stock Event 

involving twenty or more securities and 

reviews resulting from a Trigger Trade 

and any executions occurring 

immediately after a Trigger Trade but 

before a trading pause is in effect on the 

Exchange. Further, the Exchange 

believes that the proposed changes 

enhance the objectivity of decisions 

made by the Exchange with respect to 

clearly erroneous executions. The 

Exchange notes that the changes 

proposed herein will in no way interfere 

with the operation of the Pause Pilot 

process, as amended. 

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 

Because the foregoing 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 16 and Rule 19b– 

4(f)(6)(iii) thereunder.17 The 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 because such waiver will 

allow the clearly erroneous rules to 

continue to operate as they did prior to 

the effectiveness of the Pause Pilot 

expansion to Phase III Securities so that 

similarly situated market participants 

are provided the same opportunity of a 

clearly erroneous review. Accordingly, 

the Commission waives the 30-day 

operative delay requirement and 

designates the proposed rule change as 

operative upon filing with the 

Commission.18

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–2011–019 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–2011–019. 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 

publicly available. All submissions 

should refer to File Number SR–BYX– 

2011–019 and should be submitted on 

or before September 7, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20953 Filed 8–16–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65103; File No. SR–CBOE– 

2011–078] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Related to the CBSX 

Clearly Erroneous Policy Pilot Program 

August 11, 2011. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on August 8, 

2011, the Chicago Board Options 

Exchange, Incorporated (‘‘Exchange’’ or 


Emcdonald on DSK2BSOYB1PROD with NOTICES
Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 51095 

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

4 17 CFR 240.19b–4(f)(6). 

5For purposes of this filing, the term 

‘‘Exchanges’’ refers collectively to BATS Exchange, 

Inc., BATS Y–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, The NASDAQ Stock 

Market LLC, New York Stock Exchange LLC, NYSE 

Amex LLC, NYSE Arca, Inc., National Stock 

Exchange, Inc., and NASDAX [sic] OMX PHLX LLC. 

6Securities Exchange Act Release Nos. 62252 

(June 10, 2010), 75 FR 34186 (June 16, 2010) (File 

Nos. SR–BATS–2010–014; SR–EDGA–2010– 01; 

SR–EDGX–2010–01; SR–BX–2010–037; SR–ISE– 

2010–48; SR–NYSE–2010–39; SR–NYSEAmex– 

2010–46; SR–NYSEArca–2010–41; SR–NASDAQ– 

2010–061; SR–CHX–2010–10; SR–NSX–2010–05; 

and SR–CBOE–2010–047); 62251 (June 10, 2010), 

75 FR 34183 (June 16, 2010) (SR–FINRA–2010– 

025). 

7See e.g., Securities Exchange Act Release Nos. 

62884 (September 10, 2010), 75 FR 56618 

(September 16, 2010) (File Nos. SR–BATS–2010– 

018; SR–BX–2010–044; SR–CBOE–2010–065; SR– 

CHX–2010–14; SR–EDGA–2010–05; SR–EDGX– 

2010–05; SR–ISE–2010–66; SR–NASDAQ–2010– 

079; SR–NYSE–2010–49; SR–NYSEAmex–2010–63; 

SR–NYSEArca–2010–61; and SR–NSX–2010–08); 

and Securities Exchange Act Release No. 62883 

(September 10, 2010), 75 FR 56608 (September 16, 

2010) (SR–FINRA–2010–033). 

8Securities Exchange Act Release No. 62886 

(September 16 [sic], 2010), 75 FR 56613 (September 

16, 2010) (File Nos. SR–BATS–2010–016; SR–BX– 

2010–040; SR–CBOE–2010–056; SR–CHX–2010–13; 

SR–EDGA–2010–03; SR–EDGX–2010–03; SR–ISE– 

2010–62; SR–NASDAQ–2010–076; SR–NSX–2010– 

07; SR–NYSE–2010–47; SR–NYSEAmex–2010–60; 

and SR–NYSEArca–2010–58). 

9Pursuant to Rule 52.4(c)(1), a security with a 

Reference Price of greater than zero and up to an 

including $25 is subject to a 10% threshold; a 

security with a Reference Price of greater than $25 

and up to and including $50 is subject to a 5% 

threshold; and a security with a Reference Price of 

greater than $50 is subject to a 3% threshold. 

10Rule 52.4(c)(4). 

11Securities Exchange Act Release No. 64735 

(June 23, 2011), 76 FR 38243 (June 29, 2011) (File 

Nos. SR–BATS–2011–016; SR–BYX–2011–011; SR– 

BX–2011–025; SR–CBOE–2011–049; SR–CHX– 

2011–09; SR–EDGA–2011–15; SR–EDGX–2011–14; 

SR–FINRA–2011–023; SR–ISE–2011–028; SR– 

NASDAQ–2011–067; SR–NYSE–2011–21; SR– 

NYSEAmex–2011–32; SR–NYSEArca–2011–26; SR– 

NSX–2011–06; SR–Phlx–2011–64). 

‘‘CBOE’’) filed with the Securities and 

Exchange Commission (the 

‘‘Commission’’) the proposed rule 

change as described in Items I and II, 

below, which Items have been prepared 

by the Exchange. The Exchange has 

designated the proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to Section 19(b)(3)(A)(iii) of 

the Act 3 and Rule 19b–4(f)(6) 

thereunder.4 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 amend a 

clearly erroneous policy pilot program 

pertaining to the CBOE Stock Exchange 

(‘‘CBSX’’, the CBOE’s stock trading 

facility). In particular, the Exchange is 

seeking to amend Rule 52.4 so that the 

rule will continue to operate in the same 

manner after changes to the individual 

stock trading pause pilot are effective. 

The text of the proposed rule change is 

available on the Exchange’s Web site 

(http://www.cboe.org/Legal), at the 

Exchange’s Office of the Secretary 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 those 

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 the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Background 

The Exchanges 5 and FINRA, in 

consultation with the Commission, have 

made changes to their respective rules 

in a concerted effort to strengthen the 

markets after the severe market 

disruption that occurred on May 6, 

2010. One such effort by the Exchanges 

and FINRA was to adopt a uniform 

trading pause process during periods of 

extraordinary market volatility as a pilot 

in S&P 500 Index stocks (‘‘Pause Pilot’’), 

approved by the Commission on June 

10, 2010.6 On September 10, 2010, the 

Commission approved the Exchanges’ 

and FINRA’s proposals to add the 

securities included in the Russell 1000 

Index and specified exchange trading 

products (‘‘ETPs’’) to the Pause Pilot.7

On September 10, 2010, the 

Commission also approved changes 

proposed by the Exchanges to amend 

certain of their respective rules to set 

forth clearer standards and curtail their 

discretion with respect to breaking 

erroneous trades.8 The changes, among 

other things, provided uniform 

treatment of clearly erroneous execution 

reviews in the event of transactions that 

result in the issuance of an individual 

stock trading pause pursuant to the 

Pause Pilot on the listing market and 

those that occur up to the time the 

trading pause message is received by the 

other markets from the single plan 

processor responsible for consolidation 

and dissemination of information for the 

security (‘‘Latency Trades’’). 

As part of the changes to the clearly 

erroneous process under Rule 52.4, 

Clearly Erroneous Policy, the Exchange 

replaced existing Rule 52.4(c)(4) with all 

new text to provide clarity in the clearly 

erroneous process when a Pause Pilot 

trading pause is triggered. Pursuant to 

Rule 52.4(c)(4), Latency Trades will be 

broken by the Exchange if they exceed 

the applicable percentage from the 

Reference Price, as noted in the table 

found under Rule 52.4(c)(1).9 The 

Reference Price, for purposes of Rule 

52.4(c)(4), is the price that triggered a 

trading pause pursuant to the Pause 

Pilot (the ‘‘Trading Pause Trigger 

Price’’). As such, Latency Trades that 

occur on the Exchange would be broken 

by the Exchange pursuant to Rule 

52.4(c)(4) if the transaction occurred at 

either three, five or ten percent above 

the Trading Pause Trigger Price.10

On June 23, 2011, the Commission 

approved a joint proposal to expand the 

respective Pause Pilot rules of the 

Exchanges and FINRA to include all 

remaining NMS stocks (‘‘Phase III 

Securities’’).11 The new pilot rules, 

which will be implemented on August 

8, 2011, not only expand the application 

of the Pause Pilot, but also apply larger 

percentage moves that trigger a pause to 

the Phase III Securities. The Exchange 

amended its Pause Pilot rule, Rule 6.3C, 

by adding three new subparagraphs to 

address the treatment of the Phase III 

Securities. The rule applicable to the 

original Pause Pilot securities was 

placed in new Rule 6.3C.03(a). The rules 

applicable to the Phase III Securities 

were placed in new Rules 6.3C(b) [sic] 

and (c). A pause under Rule 6.3C.03(b) 

is triggered by a 30 percent price move 

within a five minute period in a Phase 

III Security that had a closing price on 

the previous trading day of $1 or more. 

A pause under Rule 6.3C.03(c) is 

triggered by a 50 percent price move 

within a five minute period in a Phase 

III Security that had a closing price on 

the previous trading day of less than $1. 

If no prior day closing price is available, 

the last sale reported to the 

Consolidated Tape on the previous 

trading day is used. 

The Issue 

The recently-approved changes to the 

Pause Pilot will have the unintended 

effect of removing the Phase III 

Securities from the normal clearly 


Emcdonald on DSK2BSOYB1PROD with NOTICES
51096 Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 

12 Id. 

13The Exchange is also proposing to amend Rule 

52.4 to remove outdated references to the term 

‘‘Circuit Breaker Stocks,’’ which was previously 

defined in Rule 6.3C.03. Through August 5, 2011, 

the term ‘‘Circuit Breaker Stocks’’ is defined to 

mean the stocks included in the S&P 500 Index, the 

Russell 1000 Index, as well as the pilot list of ETPs. 

As discussed above, beginning August 8, 2011, the 

individual stock trading pause pilot will be 

expanded to include all NMS stocks and Rule 

6.3C.03 will be revised accordingly. As revised, use 

of the term ‘‘Circuit Breaker Stocks’’ will no longer 

be necessary and it is therefore being removed from 

the Exchange Rules. See Interpretation and Policy 

.03 to Rule 6.3C and Securities Exchange Act 

Release No. 64735 (June 23, 2011), 76 FR 38243 

(June 29, 2011) (SR–CBOE–2011–049) (order 

approving expansion of the individual stock trading 

pause pilot to include all NMS stocks effective 

August 8, 2011). In that regard, the Exchange is 

herein proposing to amend Rule 52.4 to remove two 

references to the term ‘‘Circuit Breaker Stocks’’ and 

to replace them with a cross-reference to Rule 

6.3C.03(a). 

14 15 U.S.C. 78f(b)(5). 

15 15 U.S.C. 78k–1(a)(1). 

erroneous process and potentially result 

in unfair outcomes in the face of severe 

volatility in such securities. Phase III 

Securities are currently subject to the 

clearly erroneous process under Rules 

52.4(c)(1)–(3), which apply to all 

securities except the current Pause Pilot 

securities subject to a pause. For 

purposes of transactions in securities 

not involving Pause Pilot securities, or 

transactions involving Pause Pilot 

securities that occur when there is not 

a pause pursuant to the Pause Pilot, the 

Reference Price is the consolidated last 

sale price immediately prior to the 

execution(s) under review, subject to 

certain exceptions.12 As noted above, 

the Trading Pause Trigger Price is used 

as the Reference Price when a Pause 

Pilot pause is in effect. As a 

consequence, under the current rules a 

Latency Trade is subject to the clearly 

erroneous thresholds based on the 

Trading Pause Trigger Price, which 

represents a ten percent or greater move 

in the transacted price of the security in 

a five minute period. 

Under the new Pause Pilot rules, a 

Latency Trade in a Phase III Security 

occurs only after either a 30 or 50 

percent (or greater) move in the 

transacted price of the security in a five 

minute period. As a result, a Trading 

Permit Holder that trades in a Phase III 

Security that triggers a clearly erroneous 

threshold of three, five or ten percent 

from the Reference Price, yet falls below 

the Pause Pilot trigger of either 30 or 50 

percent, would be able to avail 

themselves of a clearly erroneous 

review. A similarly situated Trading 

Permit Holder that transacts in the same 

security as a Latency Trade at a price 

equal to or greater than the Phase III 

Security thresholds, yet less than the 

clearly erroneous thresholds under Rule 

52.4(c)(1), would not be able to avail 

themselves of the clearly erroneous 

process. Another Trading Permit Holder 

that transacts in the same security as a 

Latency Trade that exceeds three, five or 

ten percent from the Trading Pause 

Trigger Price would automatically 

receive clearly erroneous relief. The 

Exchange believes that this would be an 

inequitable result and an arbitrary 

application of the clearly erroneous 

process. Specifically, the Exchange 

believes that, since the 30 and 50 

percent triggers of the Pause Pilot are 

substantially greater than the 10 percent 

threshold of the original Pause Pilot, the 

Phase III Securities should remain 

under the current clearly erroneous 

process of Rules 52.4(c)(1)–(3). 

Applying the clearly erroneous 

process under Rules 52.4(c)(1)–(3) to the 

Phase III Securities would allow the 

Exchange to review all transactions that 

exceed the normal clearly erroneous 

thresholds and Reference Price, and, 

importantly, avoid arbitrary selection of 

‘‘winners’’ and ‘‘losers’’ in the face of 

severe volatile moves in a security of 30 

or 50 percent over a five minute period. 

For example, a Trading Permit Holder 

that trades in a security subject to Rule 

6.3C.03(b) or (c) that triggers a clearly 

erroneous threshold of three, five or ten 

percent, yet falls below the Pause Pilot 

trigger threshold trading at 29 percent 

from the prior day’s closing price, 

would be potentially entitled to a 

clearly erroneous break pursuant Rule 

52.4(c)(1). Should trading in that same 

stock trigger a trading pause at a price 

of 30 or 50 percent greater than the prior 

day’s close, the Trading Permit Holder 

would not be entitled to a clearly 

erroneous trade break unless that trade 

exceeded three, five or ten percent 

beyond the price that triggered the 

pause. This scenario causes an inequity 

among a group of Trading Permit 

Holders that have transactions in the 

Phase III Securities falling between the 

three, five and ten percent thresholds 

from the Reference Price under the 

normal Rule 52.4(c)(1) clearly erroneous 

process and the Pause Pilot clearly 

erroneous triggers of three, five or ten 

percent away from the Trading Pause 

Trigger Price. Such Trading Permit 

Holders would not be provided relief 

under the clearly erroneous rules merely 

due to the imposition of a Pause Pilot 

halt, notwithstanding that other member 

firms with transactions that occur at the 

same rolling five minute percentage 

difference. The Exchange believes a 

better outcome is to afford all Trading 

Permit Holders transacting in Phase III 

Securities the opportunity of having 

such trades reviewed. 

Summary 

The expansion of the Pause Pilot to 

the Phase III Securities will have the 

unintended consequence of setting the 

point at which a clearly erroneous 

transaction occurs once a Pause Pilot 

pause is initiated far beyond the triggers 

applied prior to the expansion, which 

will, in turn, prevent certain market 

participants from availing themselves of 

the clearly erroneous rules, 

notwithstanding that other similarly 

situated participants are able to do so. 

The Exchange believes that this would 

be an arbitrary application of the clearly 

erroneous process in a manner that is 

unfair and not consistent with the spirit 

and purpose of the rule. Accordingly, 

the Exchange is proposing to amend 

Rules 52.4(c)(1)–(4) to specify that Rule 

52.4(c)(4) applies only to the current 

securities of Pause Pilot, as found under 

Rule 6.3C.03(a), and not to Phase III 

Securities.13

2. Statutory Basis 

The statutory basis for the proposed 

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

Act,14 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) 15 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 

break erroneous trades, yet also ensures 

fair application of the process so that 

similarly situated Trading Permit 

Holders are provided the same 

opportunity of a clearly erroneous 

review. The Exchange notes that the 

changes proposed herein will in no way 

interfere with the operation of the Pause 

Pilot process, as amended. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

CBOE 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. 


Emcdonald on DSK2BSOYB1PROD with NOTICES
Federal Register / Vol. 76, No. 159 / Wednesday, August 17, 2011 / Notices 51097 

16 15 U.S.C. 78s(b)(3)(A). 

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

19b–4(f)(6)(iii) requires that a self-regulatory 

organization submit to the Commission written 

notice of its 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 filing of the proposed rule change, or 

such shorter time as designated by the Commission. 

The Commission is waiving the five day written 

notice requirement in this case. Therefore, the 

Commission notes that the Exchange has satisfied 

this requirement. 

18For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

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

19 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 17 CFR 240.19b–4(f)(6). 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

The Exchange neither solicited nor 

received comments on the proposal. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing 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 16 and Rule 19b– 

4(f)(6)(iii) thereunder.17 The 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 because such waiver will 

allow the clearly erroneous rules to 

continue to operate as they did prior to 

the effectiveness of the Pause Pilot 

expansion to Phase III Securities so that 

similarly situated Trading Permit 

Holders are provided the same 

opportunity of a clearly erroneous 

review. Accordingly, the Commission 

waives the 30-day operative delay 

requirement and designates the 

proposed rule change as operative upon 

filing with the Commission.18

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–CBOE–2011–078 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–CBOE–2011–078. 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 CBOE. 

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 publicly available. All 

submissions should refer to File 

Number SR–CBOE–2011–078 and 

should be submitted on or before 

September 7, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20904 Filed 8–16–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65101; File No. SR–FINRA– 

2011–039] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend FINRA Rule 

11892 (Clearly Erroneous Transactions 

in Exchange-Listed Securities) 

August 11, 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 

10, 2011, Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) 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 FINRA. FINRA has designated the 

proposed rule change as constituting a 

‘‘non-controversial’’ rule change under 

paragraph (f)(6) of Rule 19b–4 under the 

Act,3 which renders the proposal 

effective upon receipt of this filing by 

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 Substance of 

the Proposed Rule Change 

FINRA is proposing to amend FINRA 

Rule 11892 (Clearly Erroneous 

Transactions in Exchange-Listed 

Securities) so that the rule will continue 

to operate in the same manner as it did 

prior to the expansion of the trading 

pause pilot. 

The text of the proposed rule change 

is available on FINRA’s Web site at 

http://www.finra.org, at the principal 

office of FINRA and at the 

Commission’s Public Reference Room. 


Emcdonald on DSK2BSOYB1PROD with NOTICES