12228 Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 72937 

(Aug. 27, 2014), 79 FR 52385. 

4 15 U.S.C. 78s(b)(2). 

5See Securities Exchange Act Release No. 73364, 

79 FR 62988 (Oct. 21, 2014). The Commission 

designated a longer period within which to take 

action on the proposed rule change and designated 

December 2, 2014 as the date by which it should 

approve, disapprove, or institute proceedings to 

determine whether to disapprove the proposed rule 

change. 

6 16 U.S.C. 78s(b)(2)(B). 

7See Securities Exchange Act Release No. 73706, 

79 FR 72223 (December 5, 2014) (‘‘Order Instituting 

Proceedings’’). In the Order Instituting Proceedings, 

the Commission noted that it was instituting 

proceedings to allow for additional analysis of the 

proposed rule change’s consistency with the 

requirement of Section (6)(b)(5) of the Act, which 

requires, among other things, that the rules of a 

national securities exchange be designed to prevent 

fraudulent and manipulative acts and practices, to 

promote just and equitable principles of trade, and 

to protect investors and the public interest. 

8 In Amendment No. 1, the Exchange: (1) Clarified 

the definition of Fixed Income Instruments; (2) 

clarified that the types of securities and instruments 

specified as permitted investments may be 

economically tied to foreign countries; (3) clarified 

that the types of securities specified as permitted 

investments may be denominated in foreign 

currencies; (4) clarified that the Funds may invest 

in OTC foreign currency options contracts; (5) 

eliminated the ability of the Funds to enter into any 

series of purchase and sale contracts; (6) modified 

the proposal to exclude from the Funds’ permitted 

investments variable and floating rate securities and 

floaters and inverse floaters that are not Fixed 

Income Instruments; (7) modified the proposal to 

provide that a Fund may invest up to 20% of its 

total assets in (a) trade claims, (b) junior bank loans, 

(c) exchange-traded and OTC-traded structured 

products, and (d) privately placed and unregistered 

securities (except that no limit will apply to 

privately placed and unregistered securities that 

satisfy the listing requirements in the Exchange’s 

Rule 5.2(j)(3), Commentary .02(a)(6)); and (8) 

clarified that each Fund may invest up to 20% of 

its total assets in senior bank loans. 

9 15 U.S.C. 78s(b)(2). 

10See supra note 3. 

11 15 U.S.C. 78s(b)(2). 

12 17 CFR 200.30–3(a)(57). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74407; File No. SR– 

NYSEArca–2014–89] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Designation of a 

Longer Period for Commission Action 

on Proceedings To Determine Whether 

To Approve or Disapprove a Proposed 

Rule Change, as Modified by 

Amendment No. 1, To List and Trade 

Shares of Eight PIMCO ExchangeTraded Funds 

March 2, 2015. 

On August 15, 2014, NYSE Arca, Inc. 

(‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’), pursuant to section 

19(b)(1) of the Securities Exchange Act 

of 1934 (‘‘Act’’) 1 and Rule 19b–4 

thereunder,2 a proposed rule change to 

list and trade shares of the following 

eight PIMCO exchange-traded funds, 

pursuant to NYSE Arca Equities Rule 

8.600: PIMCO StocksPLUS® Absolute 

Return Exchange-Traded Fund, PIMCO 

Small Cap StocksPLUS® AR Strategy 

Exchange-Traded Fund, PIMCO 

Fundamental IndexPLUS® AR 

Exchange-Traded Fund, PIMCO Small 

Company Fundamental IndexPLUS® AR 

Strategy Exchange-Traded Fund, PIMCO 

EM Fundamental IndexPLUS® AR 

Strategy Exchange-Traded Fund, PIMCO 

International Fundamental IndexPLUS®

AR Strategy Exchange-Traded Fund, 

PIMCO EM StocksPLUS® AR Strategy 

Exchange-Traded Fund, and PIMCO 

International StocksPLUS® AR Strategy 

Exchange-Traded Fund (Unhedged) 

(each a ‘‘Fund’’ and collectively, the 

‘‘Funds’’). The proposed rule change 

was published for comment in the 

Federal Register on September 3, 2014.3

On October 15, 2014, pursuant to 

section 19(b)(2) of the Act,4 the 

Commission designated a longer period 

within which to approve the proposed 

rule change, disapprove the proposed 

rule change, or institute proceedings to 

determine whether to disapprove the 

proposed rule change.5 On December 1, 

2014, the Commission instituted 

proceedings under section 19(b)(2)(B) of 

the Act 6 to determine whether to 

approve or disapprove the proposed 

rule change.7 On December 23, 2014, 

the Exchange filed Amendment No. 1 to 

the proposed rule change, which 

entirely replaced and superseded its 

proposal as originally filed.8 The 

Commission has not received any 

comments on the proposed rule change. 

Section 19(b)(2) of the Act 9 provides 

that, after initiating disapproval 

proceedings, the Commission shall issue 

an order approving or disapproving the 

proposed rule change not later than 180 

days after the date of publication of 

notice of the filing of the proposed rule 

change. The Commission may, however, 

extend the period for issuing an order 

approving or disapproving the proposed 

rule change by not more than 60 days 

if the Commission determines that a 

longer period is appropriate and 

publishes the reasons for such 

determination. The proposed rule 

change was published for notice and 

comment in the Federal Register on 

September 3, 2014,10 and the 180th day 

after publication of the notice of the 

filing of the proposed rule change in the 

Federal Register is March 2, 2015. 

The Commission finds that it is 

appropriate to designate a longer period 

within which to issue an order 

approving or disapproving the proposed 

rule change so that it has sufficient time 

to consider the proposed rule change, as 

modified by Amendment No. 1. 

Accordingly, the Commission, pursuant 

to section 19(b)(2) of the Act,11

designates May 1, 2015 as the date by 

which the Commission shall either 

approve or disapprove the proposed 

rule change (File No. SR–NYSEArca– 

2014–89). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–05161 Filed 3–5–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74405; File No. SR–NYSE– 

2015–08] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Amending Its 

Price List 

March 2, 2015. 

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

Securities Exchange Act of 1934 

(‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that on February 

26, 2015, New York Stock Exchange 

LLC (‘‘NYSE’’ or ‘‘Exchange’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been prepared by the selfregulatory organization. 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 its 

Price List to (1) revise credits applicable 

to certain Designated Market Maker 

transactions, and (2) revise the credits 

for Supplemental Liquidity Providers. 

The Exchange also proposes to amend 

its Price List to remove certain trading 

license fees that expire on February 27, 

2015. The Exchange proposes to 

implement the fee change effective 

March 1, 2015. The text of the proposed 

rule change is available on the 

Exchange’s Web site at www.nyse.com, 

at the principal office of the Exchange, 

mstockstill on DSK4VPTVN1PROD with NOTICES

Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 12229 

4Under Rule 107B, an SLP can be either a 

proprietary trading unit of a member organization 

(‘‘SLP-Prop’’) or a registered market maker at the 

Exchange (‘‘SLMM’’). For purposes of the 10% 

average or more quoting requirement in assigned 

securities pursuant to Rule 107B, quotes of an SLPProp and an SLMM of the same member 

organization are not aggregated. However, for 

purposes of adding liquidity for assigned SLP 

securities in the aggregate, shares of both an SLPProp and an SLMM of the same member 

organization are included. 

5NYSE CADV is defined in the Price List as the 

consolidated average daily volume of NYSE-listed 

securities. 

6Rule 107B(i)(2)(A) prohibits a DMM from acting 

as a SLP in the same securities in which it is a 

DMM. 

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 

self-regulatory organization 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 

The Exchange proposes to amend its 

Price List to (1) revise credits for certain 

Designated Market Makers (‘‘DMMs’’) 

transactions, and (2) revise the credits 

for Supplemental Liquidity Providers 

(‘‘SLPs’’). The Exchange also proposes 

to amend its Price List to remove certain 

trading license fees that expire on 

February 27, 2015. 

The Exchange proposes to implement 

these fee changes effective March 1, 

2015. 

Credits for Certain DMM Transactions 

Currently, for securities with an ADV 

of less than 1 million per month in the 

previous month (‘‘Less Active 

Securities’’), DMMs receive all of the 

market data quote revenue (the 

‘‘Quoting Share’’) received by the 

Exchange from the Consolidated Tape 

Association under the Revenue 

Allocation Formula of Regulation NMS 

(regardless of whether the stock price 

exceeds $1.00) in any month in which 

the DMM quotes at the National Best 

Bid or Offer (‘‘NBBO’’) in the applicable 

security at least 15% of the time (the 

‘‘Less Active Securities Quoting 

Requirement’’). 

The Exchange proposes to increase 

the DMM’s quoting requirement at the 

NBBO to 20% in each applicable 

security in order for the DMM to receive 

100% of the Quoting Share. The 

Exchange also proposes that if the DMM 

meets the Less Active Securities 

Quoting Requirement but quotes less 

than 20% of the time in an applicable 

month, the DMM would receive 50% of 

the Quoting Share. The Exchange also 

proposes to re-locate the text describing 

Quoting Share allocation to a standalone paragraph. 

The current monthly rebate payable to 

DMMs for securities with an ADV of 

less than 250,000 shares during the 

billing month (regardless of whether the 

stock price exceeds $1.00) in any month 

in which the DMM meets the Less 

Active Securities Quoting Requirement 

is $200. 

The Exchange proposes to introduce 

different rebate amounts depending on 

the ADV of the security and the DMM 

quoting percentage. In particular, for 

securities with an ADV of 100,000 up to 

250,000 shares in the previous month, 

the Exchange proposes a monthly rebate 

of $250 when the DMM quotes at the 

NBBO 20% of the time or more in an 

applicable security in any month in 

which the DMM meets the Less Active 

Securities Quoting Requirement. If the 

DMM quotes at the NBBO at least 15% 

and up to 20% of the time in an 

applicable month in an applicable 

security, the Exchange proposes a $200 

rebate. 

For securities with an ADV of less 

than 100,000 shares in the previous 

month, the Exchange proposes a 

monthly rebate of $175 when the DMM 

quotes at the NBBO 20% of the time or 

more in an applicable security in any 

month in which the DMM meets the 

Less Active Securities Quoting 

Requirement. If the DMM quotes at the 

NBBO at least 15% and up to 20% of 

the time in an applicable month in an 

applicable security, the Exchange 

proposes a $125 rebate. 

The Exchange proposes to specify that 

the ADV would be calculated based on 

the previous month in order to make the 

ADV calculation consistent with how 

ADV is calculated for Less Active 

Securities for purposes of the Quoting 

Share rebate. 

No other changes to the DMM Tier or 

the corresponding credits would result 

from this proposed change. 

Credits Applicable to SLPs 

Currently, when adding liquidity to 

the NYSE in securities with a share 

price of $1.00 or more, if an SLP (1) 

meets the 10% average or more quoting 

requirement in assigned securities 

pursuant to Rule 107B and (2) adds 

liquidity for assigned SLP securities in 

the aggregate 4 of an ADV of more than 

0.20% of NYSE CADV,5 the SLP is 

eligible for a per share credit of $.0023. 

In the case of Non-Displayed Reserve 

Orders, the SLP credit is $0.0018 and in 

the case of MPL Orders, the credit is 

$0.0020. 

Similarly, a SLP adding liquidity for 

assigned SLP securities in the aggregate 

of an ADV of more than 0.35% of NYSE 

CADV is eligible for a per share credit 

of $.0026. In the case of Non-Displayed 

Reserve Orders, the credit is $0.0021 

and in the case of MPL Orders, the 

credit is $0.0020. 

Finally, a SLP adding liquidity for 

assigned SLP securities in the aggregate 

of an ADV of more than 0.55% of NYSE 

CADV is eligible for a per share credit 

of $.0029. In the case of Non-Displayed 

Reserve Orders, the credit is $0.0024 

and in the case of MPL Orders, the 

credit is $0.0020. 

The Exchange proposes to lower the 

ADV percentage requirement for SLPs 

that are also DMMs and subject to Rule 

107B(i)(2)(A) 6 for the above-three 

described credits applicable to SLPs 

from 0.20% to 0.15%, 0.35% to 0.30%, 

and 0.55% to 0.50%, respectively. The 

Exchange does not propose to change 

the ADV percentage requirement of 

NYSE ADV for SLPs that are not subject 

to Rule 107B(i)(2)(A), which will remain 

at 0.20%, 0.35% and 0.55%, 

respectively. 

For each of these three categories of 

SLP credits, the Exchange also proposes 

to increase the credit for securities with 

an ADV in the previous month of 

500,000 shares or less per month (‘‘Less 

Active SLP Securities’’) by $.0005, as 

follows: 

• For assigned SLP securities in the 

aggregate of an ADV of more than 0.20% 

of NYSE CADV or, if also a DMM and 

subject to Rule 107B(i)(2)(A), more than 

0.15% of NYSE CADV, increase the 

credit from $.0023 to $.0028 and 

increase the credit for Non-Displayed 

Reserve Orders from $0.0018 to $.0023. 

The credit applicable for MPL Orders 

would not change. 

• for assigned SLP securities in the 

aggregate of an ADV of more than 0.35% 

of NYSE CADV or, if also a DMM and 

subject to Rule 107B(i)(2)(A), more than 

0.30% of NYSE CADV, increase the 

credit from $.0026 to $.0031 and 

increase the credit for Non-Displayed 

Reserve Orders from $0.0021 to $.0026. 

The credit applicable for MPL Orders 

would not change. 

mstockstill on DSK4VPTVN1PROD with NOTICES

12230 Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 

7See Securities Exchange Act Release No. 34– 

73996 (January 6, 2015), 80 FR 1534 (January 12, 

2015) (SR–NYSE–2014–74). 

8See id. 

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

10 15 U.S.C. 78f(b)(4) and (5). 

• for assigned SLP securities in the 

aggregate of an ADV of more than 0.55% 

of NYSE CADV or, if also a DMM and 

subject to Rule 107B(i)(2)(A), more than 

0.050% of NYSE ADV, increase the 

credit from $.0029 to $.0034 and 

increase the credit for Non-Displayed 

Reserve Orders from $0.0024 to $.0029. 

The credit applicable for MPL Orders 

would not change. 

No other changes to SLP Tier or the 

corresponding credits would result from 

this proposed change. 

Trading License Fees 

On December 23, 2014, the Exchange 

filed to amend its Price List related to 

fees for trading licenses to extend the 

fee schedule to February 27, 2015 and 

to implement new trading license fees 

effective March 1, 2015.7

In particular, for the period between 

January 2, 2015 and February 27, 2015, 

the Exchange retained an annual fee of 

$40,000 per license for the first two 

trading licenses held by a member 

organization and $25,000 for each 

additional trading license. The 

Exchange also retained a fee relief 

scheme whereby fees for trading 

licenses issued after July 1, 2013 were 

prorated for the portion of the calendar 

year that the trading license was 

outstanding but if a member 

organization was issued additional 

trading licenses between July 1, 2013 

and February 27, 2015, and the total 

number of trading licenses held by the 

member during that time was greater 

than the total number of trading licenses 

held by the member organization on 

July 1, 2013, the member organization 

would not be charged a prorated fee for 

the period from July 3, 2013 to February 

27, 2015 for those additional trading 

licenses above the number the member 

organization held on July 1, 2013.8

The Exchange’s filing also proposed 

that, effective March 1, 2015, the 

Exchange would charge an annual fee of 

$50,000 for the first license held by a 

member organization and $15,000 for 

each additional license. The Exchange 

also proposed to eliminate the existing 

fee relief for additional licenses and 

delete the relevant text from current 

footnote 15 effective March 1, 2015. 

The Exchange accordingly proposes to 

amend the Price List to reflect the 

elimination of the fees in effect through 

February 27, 2015 and the fee relief for 

additional licenses by deleting the text 

describing those fees and corresponding 

footnote 15 from the Price List. The 

Exchange also proposes to delete the 

‘‘A’’ from footnote 15A in the current 

Price List so that footnote 15A would 

become footnote 15 to the new annual 

fee and regulated only member annual 

administration fee effective March 1, 

2015. 

Finally, the Exchange proposes to 

amend current footnote 15A to the Price 

List (proposed footnote 15) to change 

the number of calendar days a trading 

license is charged a flat fee. Currently, 

footnote 15A provides that for a trading 

license in place for 15 calendar days or 

less in a calendar month, proration for 

that month is at a flat rate of $100 per 

day with no tier pricing involved. For a 

trading license in place for 16 calendar 

days or more in a calendar month, 

proration for that month is computed 

based on the number of days as applied 

to the applicable annual fee for the 

trading license. 

The Exchange proposes to lower the 

number of calendar days charged the 

flat rate of $100 per day with no tier 

pricing from 15 to 10 and make a 

corresponding change from 16 to 11 

calendar days for licenses that would be 

held beyond the period subject to the 

flat rate and that would be prorated 

based on the number of days as applied 

to the applicable annual fee for the 

trading license. The Exchange has 

determined this change is necessary 

once the fee for additional licenses 

becomes $15,000 effective March 1, 

2015 in order to avoid charging a fee to 

license holders at a flat rate ($1500/$100 

per day for 15 calendar days) that would 

exceed the monthly cost of the license 

($1,250/$15,000 divided by 12). The 

Exchange believes that lowering the 

calendar days during which license 

holders are charged the flat rate to 10 

days ($1,000/$100 per day for 10 

calendar days) would avoid this result 

and be more equitable for license 

holders. 

The above proposed changes are not 

otherwise intended to address any other 

issues, and the Exchange is not aware of 

any problems that members and 

member organizations would have in 

complying with the proposed change. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

section 6(b) of the Act,9 in general, and 

furthers the objectives of sections 6(b)(4) 

and 6(b)(5) of the Act,10 in particular, 

because it provides for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members, 

issuers and other persons using its 

facilities and does not unfairly 

discriminate between customers, 

issuers, brokers or dealers. 

The Exchange believes that the 

proposed higher monthly credit of $250 

for each security that has a consolidated 

ADV of more than 100,000 and less than 

250,000 shares during the month when 

the DMM quotes at the NBBO in the 

applicable security at least 20% of the 

time in the applicable month is 

reasonable because of the proposed 

higher quoting requirement associated 

with this increase in the credit. The 

Exchange also believes that it is 

reasonable to retain a $200 credit for 

each security that has a consolidated 

ADV of more than 100,000 and less than 

250,000 shares during the month when 

the DMM quotes at the NBBO in the 

applicable security at least 15% and up 

to 20% of the time in the applicable 

month as this is the rate currently 

charged and it would apply equally to 

all DMM firms. The Exchange believes 

that the proposal would increase the 

incentive to add liquidity across thinlytraded securities where there may be 

fewer liquidity providers. 

The Exchange also believes that the 

proposed lower monthly credits of $175 

for each security that has a consolidated 

ADV 100,000 shares or less during the 

month when the DMM quotes at the 

NBBO in the applicable security at least 

20% of the time in the applicable month 

is reasonable in light of lower trading 

volumes in the applicable securities 

relatively to those securities that have a 

consolidated ADV of more than 100,000 

and less than 250,000 shares. The 

Exchange further believes it is 

reasonable to provide a lower rebate of 

$125.00 for each security that has a 

consolidated ADV of 100,000 shares or 

less if the DMM does not meet the 

proposed 20% quoting requirement. 

Moreover, the requirement is equitable 

and not unfairly discriminatory because 

it would apply equally to all DMM 

firms. 

Further, the Exchange believes that 

the proposed higher DMM quoting 

requirement at the NBBO of 20% in 

order to receive in each applicable 

security 100% of the Quoting Share is 

reasonable because the higher proposed 

requirement would improve quoting 

and increase adding liquidity across 

thinly-traded securities where there may 

be fewer liquidity providers. Under the 

proposal, DMMs that do not meet the 

proposed quoting requirement of 20% 

but still meet the Less Active Securities 

Quoting Requirement of 15% would 

still receive 50% of the Quoting Share. 

Moreover, the requirement is equitable 

and not unfairly discriminatory because 

it would apply equally to all DMM 

mstockstill on DSK4VPTVN1PROD with NOTICES

Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 12231 

11 15 U.S.C. 78f(b)(8). 

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

13 17 CFR 240.19b–4(f)(2). 

14 15 U.S.C. 78s(b)(2)(B). 

firms. The Exchange notes that the 

Quoting Share in Less Active Securities 

the DMMs receive is in addition to the 

DMM rebate for providing liquidity and 

the monthly rebate payable to DMMs for 

securities with an ADV of less than 

250,000 shares during the billing month. 

In addition, the Exchange believes 

that proposal to lower the ADV 

percentage requirement for SLPs that are 

also DMMs and subject to Rule 

107B(i)(2)(A) is reasonable because the 

current ADV requirement is more 

difficult for such market participants to 

meet given that the pool of stocks they 

are allowed to trade is smaller. Pursuant 

to Rule 107B(i)(2)(A), a DMM unit may 

not act as an SLP in the same securities 

in which it is a DMM. Accordingly, a 

SLP that is also a DMM subject to Rule 

107B(i)(2)(A) would not be eligible to be 

assigned securities in which the 

affiliated DMM is registered, thereby 

reducing the number of securities 

available to such an SLP to meet the 

adding liquidity requirement, which is 

expressed as a percentage of NYSE 

CADV. The Exchange further believes 

that the proposed lower ADV percentage 

for such SLPs is equitable and not 

unfairly discriminatory because it 

would be applied equally to all SLPs 

that are also DMMs subject to Rule 

107B(i)(2)(A). SLPs that are not DMMs 

do not have the same restrictions on 

which securities they may be assigned 

as a SLP and would not be harmed by 

the proposal for those firms that are also 

DMMs. 

Further, increasing the credit for SLP 

transactions providing liquidity in Less 

Active SLP Securities by $0.0005 is 

reasonable because it will encourage 

greater liquidity and competition in 

such securities on the Exchange. The 

Exchange also believes that increasing 

the SLP credit is reasonable because it 

will increase the incentive to add 

liquidity across thinly traded securities 

where there may be fewer liquidity 

providers. Once again, the Exchange 

believes that the proposed higher credit 

is equitable and not unfairly 

discriminatory because it would apply 

equally to all SLPs. 

Finally, amending the Price List to 

remove fees that are expiring on 

February 27, 2015 provides greater 

clarity and transparency to the Price List 

and avoids confusion as to what trading 

license fees would apply after that date. 

Further, amending the Price List to 

change the number of calendar days a 

trading license is charged a flat fee is 

reasonable because it would avoid 

charging a fee to license holders at a flat 

rate that would exceed the monthly cost 

of the license, which is scheduled to 

begin on March 1, 2015. This proposal 

is equitable and not unfairly 

discriminatory because it would apply 

the unchanged flat rate equally to all 

license holders over the same number of 

days. 

The Exchange believes that it is 

subject to significant competitive forces, 

as described below in the Exchange’s 

statement regarding the burden on 

competition. 

For the foregoing reasons, the 

Exchange believes that the proposal is 

consistent with the Act. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

In accordance with section 6(b)(8) of 

the Act,11 the Exchange believes that the 

proposed rule change would not impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Instead, the 

Exchange believes that the proposed 

change would contribute to the 

Exchange’s market quality by promoting 

price discovery and ultimately 

increased competition. For the same 

reasons, the proposed change also 

would not impose any burden on 

competition among market participants. 

Pricing for executions at the opening 

would remain at the same relatively low 

levels and would continue to reflect the 

benefit that market participants receive 

through the ability to have their orders 

interact with other liquidity at the 

opening. 

Finally, the Exchange notes that it 

operates in a highly competitive market 

in which market participants can 

readily favor competing venues if they 

deem fee levels at a particular venue to 

be excessive or rebate opportunities 

available at other venues to be more 

favorable. In such an environment, the 

Exchange must continually adjust its 

fees and rebates to remain competitive 

with other exchanges and with 

alternative trading systems that have 

been exempted from compliance with 

the statutory standards applicable to 

exchanges. Because competitors are free 

to modify their own fees and credits in 

response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

believes that the degree to which fee 

changes in this market may impose any 

burden on competition is extremely 

limited. As a result of all of these 

considerations, the Exchange does not 

believe that the proposed changes will 

impair the ability of member 

organizations or competing order 

execution venues to maintain their 

competitive standing in the financial 

markets. 

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 with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change is effective 

upon filing pursuant to section 

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

subparagraph (f)(2) of Rule 19b–4 13

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

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. If the 

Commission takes such action, the 

Commission shall institute proceedings 

under section 19(b)(2)(B) 14 of the Act to 

determine whether the proposed rule 

change 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– 

NYSE–2015–08 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE., Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NYSE–2015–08. 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/

mstockstill on DSK4VPTVN1PROD with NOTICES

12232 Federal Register / Vol. 80, No. 44 / Friday, March 6, 2015 / Notices 

15 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 204.19b–4. On October 15, 2014, OCC 

also filed an emergency notice with the 

Commission to suspend the effectiveness of the 

second sentence of Rule 1001(a). See infra note 10 

and accompanying discussion. 

3Exchange Act Release No. 73685 (November 25, 

2014) 78 FR 71479 (December 2, 2014) (SR–OCC– 

2014–21). 

4 Id. 

5On January 5, 2015, pursuant to Section 

19(b)(2)(A)(ii)(II) of the Exchange Act, as amended, 

OCC consented to an extension until March 2, 2015, 

for the Commission to approve the proposed rule 

change, disapprove the Proposed Rule Change, or 

institute proceedings to determine whether to 

disapprove the Proposed Rule Change. 15 U.S.C. 

78s(b)(2)(A)(ii)(II). 

6 15 U.S.C. 78s(b)(2)(B). 

7OCC Rule 1001(a). 

8See OCC By-Laws, Article IX, Section 14(c). 

9 Id. 

10On October 15, 2014, OCC also filed an 

emergency notice with the Commission pursuant to 

Section 806(e)(2) of the Payment, Clearing, and 

Settlement Supervision Act of 2010 (‘‘Clearing 

Supervision Act’’). 12 U.S.C. 5465(e)(2). See 

Securities Exchange Act Release No. 73579 

(November 12, 2014), 79 FR 68747 (November 18, 

2014) (SR–OCC–2014–807). 

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 the 

filing will also be available for 

inspection and copying at the NYSE’s 

principal office and on its Internet Web 

site at 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–NYSE– 

2015–08 and should be submitted on or 

before March 27, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–05159 Filed 3–5–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74406; File No. SR–OCC– 

2014–21] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Order 

Instituting Proceedings To Determine 

Whether To Approve or Disapprove a 

Proposed Rule Change in Order To 

Permit OCC To Adjust the Size of Its 

Clearing Fund on an Intra-Month Basis 

March 2, 2015. 

I. Introduction 

On November 13, 2014, The Options 

Clearing Corporation (‘‘OCC’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’) proposed 

rule change SR–OCC–2014–21 

(‘‘Proposed Rule Change’’) pursuant to 

Section 19(b)(1) of the Securities 

Exchange Act of 1934 (‘‘Exchange 

Act’’) 1 and Rule 19b–4 thereunder.2 In 

the Proposed Rule Change, OCC 

proposes to amend its Rule 1001(a) to 

delete the requirement that OCC 

readjust the size of its clearing fund on 

a monthly basis.3 On December 2, 2014, 

the proposed rule change was published 

in the Federal Register.4 The 

Commission received no comments to 

the Proposed Rule Change.5 This order 

institutes proceedings under Section 

19(b)(2)(B) of the Exchange Act 6 to 

determine whether to approve or 

disapprove the Proposed Rule Change. 

II. Description of the Proposed Rule 

Change 

OCC proposed this Proposed Rule 

Change to permit OCC to collect 

additional financial resources from its 

clearing members by increasing the size 

of its clearing fund on an intra-month 

basis when OCC determines that such 

action should be taken to ensure the 

clearing fund has sufficient resources to 

protect OCC against potential losses 

under simulated default scenarios. 

Specifically, OCC’s Proposed Rule 

Change proposes to amend Rule 1001(a) 

to delete the second sentence, which 

states, ‘‘[s]uch [clearing fund resizing 

calculations] shall be made on a daily 

basis, and the size of the Clearing Fund 

shall be readjusted monthly based upon 

the average of such daily calculations 

performed during the preceding 

month.’’ 7

A. Background 

In emergency circumstances and 

subject to certain conditions, Article IX, 

Section 14, of OCC’s By-Laws permit 

OCC’s Board of Directors, Executive 

Chairman, or President to waive or 

suspend its by-laws, rules, policies and 

procedures, or any other rules issued by 

OCC, or extend the time fixed thereby 

for the doing of any act or acts for up 

to thirty calendar days. To extend such 

a wavier or suspension for more than 

thirty calendar days, OCC’s by-laws 

require it to submit a proposed rule 

change to the Commission seeking 

approval of such waiver.8 Upon 

submission of a rule filing, the waiver 

may continue in effect until the 

Commission approves or disapproves 

the proposed rule change.9

Although OCC monitors the 

sufficiency of its clearing fund on a 

daily basis, OCC Rule 1001(a) provides 

that it may only readjust the size of the 

clearing fund on a monthly basis. On 

October 15, 2014, in order to address 

certain unanticipated intra-month 

market volatility OCC’s Executive 

Chairman, pursuant to emergency 

authority, temporarily waived the OCC 

Rule 1001(a) requirement that OCC 

readjust the size of its clearing fund on 

a monthly basis, allowing OCC to resize 

the clearing fund intra-month. OCC was 

concerned that its current financial 

resources might not meet the total 

financial resources required to cover the 

default of its largest participant family. 

The waiver permitted OCC to increase 

the size of the clearing fund for the 

remainder of October 2014, prior to the 

next monthly resizing scheduled for the 

first business day of November 2014. As 

a result of the emergency action, OCC’s 

clearing fund for October 2014 was 

increased by $1.8 billion to a total 

amount of $5.8 billion. 

B. Proposed Rule Change SR–OCC– 

2014–21 

OCC submitted the Proposed Rule 

Change, which amends its Rule 1001(a) 

by deleting the provision that requires 

OCC to readjust the size of its clearing 

fund on a monthly basis, allowing OCC 

to continue to collect additional 

financial resources from its clearing 

membership by increasing the size of its 

clearing fund on an intra-month basis 

when OCC determines such action 

should be taken so that the clearing 

fund is sufficient to protect OCC against 

potential loss under simulated default 

scenarios.10 OCC stated that it took this 

action to respond to the potential risk 

under prevailing market conditions that 

the clearing fund could be underfunded, 

which could have affected OCC’s ability 

to provide services in a safe and sound 

manner. As noted, OCC’s waiver of the 

provisions of the second sentence of 

Rule 1001(a) is permitted to continue for 

mstockstill on DSK4VPTVN1PROD with NOTICES