Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices 8731 

10 15 U.S.C. 78q–1(b)(3)(F). 

11 15 U.S.C. 78q–1. 

12 15 U.S.C. 78s(b)(2). 

13 In approving the proposed rule change, the 

Commission considered the proposal’s impact on 

efficiency, competition and capital formation. 15 

U.S.C. 78c(f). 

14 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). 

4 17 CFR 240.19b–4(f)(6)(iii). 

5See Securities Exchange Act Release No. 71449 

(January 30, 2014), 79 FR 6961 (February 5, 2014) 

(SR–EDGX–2013–043; SR–EDGA–2013–034). 

6See BZX and BYX Rules 1.5, 2.3, 2.5, and 2.6. 

7The Exchange notes that EDGX intends to file 

a proposal very similar to this proposal that will 

align the rules related to registration requirements 

across each of the BGM Affiliated Exchanges. 

clearance and settlement of securities 

transactions, consistent with Section 

17A(b)(3)(F) of the Act.10

V. Conclusion 

On the basis of the foregoing, the 

Commission finds that the proposal is 

consistent with the requirements of the 

Act and in particular with the 

requirements of Section 17A of the 

Act 11 and the rules and regulations 

thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,12 that the 

proposed rule change (SR–ICC–2014– 

21) be, and hereby is, approved.13

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–03229 Filed 2–17–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74254; File No. SR–EDGA– 

2015–06] 

Self-Regulatory Organizations; EDGA 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change to Rules 1.5, 2.3, 2.5, and 

2.6 Related to the Registration 

Requirements for Members of EDGA 

Exchange, Inc. 

February 11, 2015. 

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 January 

30, 2015, EDGA Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGA’’) 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 Exchange has 

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

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

Act 3 and Rule 19b–4(f)(6)(iii) 

thereunder,4 which renders it 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 Substance of 

the Proposed Rule Change 

The Exchange filed a proposal to 

amend Rules 1.5, 2.3, 2.5, and 2.6 

related to the registration requirements 

for Members of the Exchange. 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at 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 amend the 

various Exchange rules related to the 

registration requirements on the 

Exchange in order to make the 

Exchange’s registration requirements 

substantively identical to the 

corresponding rules on BATS Exchange, 

Inc. (‘‘BZX’’) and BATS Y-Exchange, 

Inc. (‘‘BYX’’), as further described 

below. Earlier this year, the Exchange 

and its affiliate, EDGX Exchange, Inc. 

(‘‘EDGX’’), received approval to effect a 

merger (the ‘‘Merger’’) of the Exchange’s 

parent company, Direct Edge Holdings 

LLC, with BATS Global Markets, Inc., 

the parent of BZX and BYX (together 

with BZX, EDGA, and EDGX, the ‘‘BGM 

Affiliated Exchanges’’).5 In the context 

of the Merger, the BGM Affiliated 

Exchanges are working to align certain 

system and regulatory functionality, 

retaining only intended differences 

between the BGM Affiliated Exchanges. 

Thus, the proposal set forth below is 

intended to amend Rules 1.5, 2.3, 2.5, 

and 2.6 to make such Rules 

substantively identical to corresponding 

rules on BZX and BYX 6 related to 

registration requirements in order to 

provide a consistent regulatory 

approach across each of the BGM 

Affiliated Exchanges.7

Currently, Rule 1.5(n) defines the 

term ‘‘Member’’ as meaning any 

registered broker or dealer, or any 

person associated with a registered 

broker or dealer, that has been admitted 

to membership in the Exchange. A 

Member will have the status of a 

‘‘member’’ of the Exchange as that term 

is defined in Section 3(a)(3) of the Act. 

The Exchange is proposing, however, to 

delete ‘‘or any person associated with a 

registered broker or dealer’’ from the 

rule text, as such phrase is not 

contained in corresponding BZX and 

BYX rules (i.e., Rule 1.5(n)) and because 

the Exchange no longer believes that 

this language is necessary. The 

Exchange is also proposing to amend 

the rule text such that Membership may 

be granted to a sole proprietor, 

partnership, corporation, limited 

liability company or other organization 

which is a registered broker or dealer 

pursuant to Section 15 of the Act, and 

which has been approved by the 

Exchange, language which is currently 

included in Rule 2.3(a), which, as 

described below, the Exchange is 

proposing to delete in order to further 

align Exchange rules with BZX and BYX 

1.5(n). 

The Exchange is also proposing to 

delete the definition of ‘‘Principal’’ from 

Rule 1.5(t), which will instead be 

defined in the proposed changes to 

paragraph (d) of Interpretation and 

Policy .01 to Rule 2.5, which are further 

described below. Currently, the term 

principal means persons associated with 

a member who are actively engaged in 

the management of the member’s 

securities business, including 

supervision, solicitation, conduct of 

business or the training of persons 

associated with a Member for any of 

these functions. Such persons shall 

include sole proprietors, officers, 

partners, managers of business offices 

engaged in such functions, and directors 

of corporations. The Exchange is 

proposing to add the text ‘‘(Reserved)’’ 

to the rule text in order to maintain the 

current paragraph numbering within 

Rule 1.5. The proposed new definition 

for principal will be discussed below. 

The Exchange intends to consolidate 

its registration requirements in Rule 2.5 


emcdonald on DSK67QTVN1PROD with NOTICES
8732 Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices 

8See Exchange Rule 2.3. 

in order to align the rule with BZX and 

BYX Rule 2.5. Accordingly, the 

Exchange is also proposing to make 

several changes to Rule 2.3, currently 

titled ‘‘Member Eligibility & 

Registration’’, which will also make the 

Rule consistent with BZX and BYX Rule 

2.3. First, consistent with this 

consolidation, the Exchange is 

proposing to delete ‘‘& Registration’’ 

from the title of Rule 2.3, which is also 

consistent with BZX and BYX Rule 2.3. 

The Exchange is also proposing to 

amend Rule 2.3(a), which currently 

states that ‘‘Except as hereinafter 

provided, any broker or dealer 

registered pursuant to Section 15 of the 

Act, that is and remains a member of 

another registered national securities 

exchange or association (other than or in 

addition to the Exchange’s affiliates— 

BATS Exchange, Inc., BATS YExchange, Inc., or EDGX Exchange, 

Inc.), or any person associated with 

such a registered broker or dealer, shall 

be eligible to be and to remain a 

Member. Membership may be granted to 

a sole proprietor, partnership, 

corporation, limited liability company 

or other organization or individual that 

has been approved by the Exchange.’’ 

The Exchange is proposing to amend 

Rule 2.3(a) to read: ‘‘Except as 

hereinafter provided, any registered 

broker or dealer that is and remains a 

member of another registered national 

securities exchange or association (other 

than or in addition to the Exchange’s 

affiliates—BATS Exchange, Inc., BATS 

Y-Exchange, Inc., or EDGX Exchange, 

Inc.), or any person associated with 

such a registered broker or dealer, shall 

be eligible to be and to remain a 

Member,’’ which will make such Rule 

substantively identical to that of both 

BZX and BYX Rule 2.3(a). As described 

above, the Exchange has proposed to 

add substantially similar language to 

Exchange Rule 1.5(n) to conform such 

Rule with BZX and BYX Rule 1.5(n). 

The Exchange is also proposing to 

delete Rules 2.3(b), (c), and (d), entitled 

‘‘Registration Requirements,’’ 

‘‘Registration of Principals,’’ and 

‘‘Persons Exempt from Registration’’ and 

replace them with proposed new Rule 

2.5 Interpretation and Policy .01 (d) 

through (i) and Rule 2.6(g), effectively 

moving the requirements from Rule 2.3 

to Rules 2.5 and 2.6, making the 

Exchange Rules consistent with those of 

BZX and BYX. The Exchange notes that, 

except as stated below, there are no 

substantive differences between the 

language that the Exchange is proposing 

to delete in Rules 2.3(b), (c), and (d) that 

is not otherwise being proposed to be 

added back in the amendments to Rule 

2.5 Interpretation and Policy .01 (d) 

through (i) and Rule 2.6(g). The only 

material differences between the 

Exchange’s current rules and the 

proposed rules are as follows: (i) As 

proposed, the Exchange would accept 

the New York Stock Exchange Series 14 

Compliance Official Examination in lieu 

of the Series 24 to satisfy the 

requirement for any person designated 

as a Chief Compliance Officer, which it 

currently does not; and (ii) as proposed, 

the Exchange would permit the Series 

56 as a prerequisite to the Series 24 or 

Series 14 for those Principals whose 

supervisory responsibilities are limited 

to overseeing the activities of 

proprietary traders instead of requiring 

the Series 7 for all principals. The 

Exchange also notes that, as proposed, 

Rule 2.5 Interpretation and Policy .01(e) 

would allow the Exchange to waive the 

Financial/Operations Principal 

requirements where a Member has 

satisfied the financial and operational 

requirements of the Member’s 

designated examining authority 

applicable to registration, a provision 

which the Exchange has proposed to 

include because the Exchange is not the 

designated examining authority for any 

of its Members and requires all of its 

Members to be a member of at least one 

other national securities association or 

national securities exchange (excluding 

other BGM Affiliated Exchanges).8 The 

Exchange does not believe that not 

including certain exemptions currently 

existing within Rules 2.3(b) and (c) are 

substantive differences because the 

Exchange believes that, while not 

necessarily presented as exemptions to 

Exchange Rules, such language is 

otherwise covered by proposed Rule 2.5 

Interpretation and Policy .01. For 

instance, the Exchange does not believe 

it needs to exempt clerical or 

administrative personnel from Exchange 

registration requirements because 

Exchange Rules, either in their current 

form or as amended, do not state or 

imply that such personnel are required 

to register with the Exchange. The 

Exchange’s registration rules instead 

require registration with the Exchange 

of Authorized Traders as well as those 

personnel responsible for supervision of 

such personnel and the supervision of a 

Member firm more generally (i.e., a 

firm’s Chief Compliance Officer and 

Financial/Operations Principal). 

The Exchange is also proposing to 

make certain amendments to Rule 2.5 in 

order to conform with BZX and BYX 

Rule 2.5. Specifically, the Exchange is 

proposing to amend Interpretation and 

Policy .03 to Rule 2.5, to conform the 

numbering of such Interpretation and 

Policy to BZX and BYX Rule 2.5, 

Interpretation and Policy .01(c). As 

such, the Exchange is proposing that 

such paragraph state that the Exchange 

requires the General Securities 

Representative Examination or an 

equivalent foreign examination module 

approved by the Exchange in qualifying 

persons seeking registration as general 

securities representatives, including as 

Authorized Traders on behalf of 

Members. For those persons seeking 

limited registration as Proprietary 

Traders as described in proposed 

paragraph (f), the Exchange requires the 

Proprietary Traders Qualification 

Examination. The Exchange uses the 

Uniform Application for Securities 

Industry Registration or Transfer as part 

of its procedure for registration and 

oversight of Member personnel. The 

changes do not substantively modify the 

operation of Interpretation and Policy 

.03, but rather, serve to modify the 

numbering of the provision 

(renumbering it as paragraph (c) of 

Interpretation and Policy .01), update 

internal cross-references, and modify 

the language of the provision to align 

with that contained within BZX and 

BYX Rule 2.5, Interpretation and Policy 

.01(c). 

Finally, the Exchange is proposing to 

make certain non-substantive changes 

including the deletion of paragraphs (1) 

through (4) of Interpretation and Policy 

.03 to Rule 2.5, along with the entirety 

of Interpretation and Policy .04, .05, and 

.06 to Rule 2.5 and replacing them with 

the language from the corresponding 

BZX and BYX rules contained within 

proposed Interpretation and Policy .02 

(‘‘Continuing Education 

Requirements’’), .03 (‘‘Registration 

Procedures’’), and .04 (‘‘Termination of 

Employment’’) to Rule 2.5. Such 

proposed language is substantively 

identical to the existing Exchange rules 

and constitutes a reorganization of rule 

text designed to harmonize the structure 

of the rules across each of the BGM 

Affiliated Exchanges rather than to 

materially amend any Exchange Rules. 

The Exchange is also proposing to 

change the numbering and adding [sic] 

titles in several of the Interpretations 

and Policies to Rule 2.5 to increase 

clarity in the proposed rules. 

The Exchange notes that there are 

certain additional differences between 

the rules proposed herein and those of 

BZX that relate to registration for 

options trading because BZX has an 

options trading platform and thus has 

certain registration requirements that do 

not apply to the Exchange. Similar to 

the proposed rules proposed for the 

Exchange, BYX has no such registration 


emcdonald on DSK67QTVN1PROD with NOTICES
Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices 8733 

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

10 15 U.S.C. 78f(b)(5). 

11See supra note 7. 

12 15 U.S.C. 78s(b)(3)(A). 

13 17 CFR 240.19b–4. 14 17 CFR 200.30–3(a)(12). 

requirements because it also does not 

have an options trading platform. 

The Exchange is proposing to 

implement the proposed changes on 

March 2, 2015. 

2. Statutory Basis 

The Exchange believes that the rule 

change proposed in this submission 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(b) of the Act.9 Specifically, 

the proposed change is consistent with 

Section 6(b)(5) of the Act,10 because it 

is designed 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. As mentioned above, the 

proposed rule changes, combined with 

the planned filing for EDGA [sic],11

would allow the BGM Affiliated 

Exchanges to provide a consistent set of 

rules as it relates to the registration 

requirements across each of the 

exchanges. Consistent rules, in turn, 

will simplify the regulatory 

requirements for Members of the 

Exchange that are also participants on 

EDGA [sic], BZX and/or BYX. The 

proposed rule change would provide 

greater harmonization between rules of 

similar purpose on the BGM Affiliated 

Exchanges, resulting in greater 

uniformity and less burdensome and 

more efficient regulatory compliance. 

As such, the proposed rule change 

would foster cooperation and 

coordination with persons engaged in 

facilitating transactions in securities and 

would remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system. 

Similarly, the Exchange also believes 

that, by harmonizing the rules and 

registration requirements across each 

BGM Affiliated Exchange, the proposal 

will enhance the Exchange’s ability to 

fairly and efficiently regulate its 

Members, meaning that the proposed 

rule change is equitable and will 

promote fairness in the market place. 

Finally, the Exchange believes that 

the non-substantive changes discussed 

above will contribute to the protection 

of investors and the public interest by 

helping to avoid confusion with respect 

to Exchange rules. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the act. To the 

contrary, allowing the Exchange to 

implement substantively identical 

registration rules across each of the 

BGM Affiliated Exchanges does not 

present any competitive issues, but 

rather is designed to provide greater 

harmonization among Exchange [sic], 

BYX, EDGA, and EDGX rules of similar 

purpose, resulting in less burdensome 

and more efficient regulatory 

compliance for common members of the 

BGM Affiliated Exchanges and an 

enhanced ability of the BGM Affiliated 

Exchanges to fairly and efficiently 

regulate members, which will further 

enhance 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 

The Exchange has designated this rule 

filing as non-controversial under 

Section 19(b)(3)(A) of the Act 12 and 

paragraph (f)(6) of Rule 19b–4 

thereunder.13

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

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 email to rule-comments@

sec.gov. Please include File Number SR– 

EDGA–2015–06 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–EDGA–2015–06. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (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 

10:00 a.m. and 3:00 p.m. Copies of such 

filing will also 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–EDGA– 

2015–06 and should be submitted on or 

before March 11, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–03227 Filed 2–17–15; 8:45 am] 

BILLING CODE 8011–01–P 


emcdonald on DSK67QTVN1PROD with NOTICES