Federal Register / Vol. 80, No. 48 / Thursday, March 12, 2015 / Notices 13047 

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

5 15 U.S.C. 78q–1(b)(3)(F). 

6 15 U.S.C. 78q–1. 

7 17 CFR 240.17Ad–22. 

8 15 U.S.C. 78q–1(b)(3)(F). 

9 15 U.S.C. 78q–1. 

10 15 U.S.C. 78s(b)(2). 

11 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). 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 72625 

(July 16, 2014), 79 FR 42566 (July 22, 2014) (SR– 

NYSEMKT–2014–60). 

4See Securities Exchange Act Release No. 67347 

(July 3, 2012), 77 FR 40673 (July 10, 2012) (‘‘RLP 

Approval Order’’) (SR–NYSEAmex–2011–84). 

III. Discussion and Commission 

Findings 

Section 19(b)(2)(C) of the Act 4 directs 

the Commission to approve a proposed 

rule change of a self-regulatory 

organization if the Commission finds 

that such proposed rule change is 

consistent with the requirements of the 

Act and the rules and regulations 

thereunder applicable to such selfregulatory organization. Section 

17A(b)(3)(F) of the Act 5 requires, among 

other things, that the rules of a clearing 

agency are designed to promote the 

prompt and accurate clearance and 

settlement of securities transactions 

and, to the extent applicable, derivative 

agreements, contracts, and transactions, 

to assure the safeguarding of securities 

and funds which are in the custody or 

control of the clearing agency or for 

which it is responsible and, in general, 

to protect investors and the public 

interest. 

The Commission finds that ICC’s 

proposed revisions to its End-of-Day 

Price Discovery Policies and Procedures 

is consistent with the requirements of 

Section 17A of the Act 6 and regulations 

thereunder applicable to it, including 

the standards under Rule 17Ad–22.7

The proposed rule change is designed to 

enhance ICC’s price discovery process 

by including all price submissions 

(including those classified as obvious 

errors) in the process of determining 

Firm Trades, thereby reducing price 

submissions that may be classified as 

obvious errors. In addition, the 

proposed rule change would adjust the 

trading prices of Firm Trades that 

include a bid or offer classified as an 

obvious error to fall within a predefined 

range on either side of the EOD price, 

thereby limiting CPs’ potential P/L 

exposure to obvious errors from the risk 

management perspective, while holding 

them accountable for their price 

submissions. Finally, the proposed rule 

change would assist CPs in unwinding 

Firm Trades in certain index products 

by generating reversing trades at the 

EOD level based on liquidity. The 

Commission believes that the proposal 

is therefore designed to promote the 

prompt and accurate clearance and 

settlement of securities transactions and 

derivative agreements, contracts and 

transactions cleared by ICC, consistent 

with Section 17A(b)(3)(F) of the Act.8

IV. 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 9

and the rules and regulations 

thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,10 that the 

proposed rule change (SR–ICC–2015– 

001) be, and hereby is, approved.11

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2015–05602 Filed 3–11–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74455; File No. SR– 

NYSEMKT–2015–14] 

Self-Regulatory Organizations; NYSE 

MKT LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Extend the Pilot 

Period for the Exchange’s Retail 

Liquidity Program, Which Is Currently 

Scheduled To Expire on March 31, 

2015, Until September 30, 2015 

March 6, 2015. 

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 February 

27, 2015, NYSE MKT LLC (the 

‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with 

the Securities and Exchange 

Commission (‘‘SEC’’ or ‘‘Commission’’) 

the proposed rule change as described 

in Items I, II, and III 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 for the Exchange’s Retail 

Liquidity Program (the ‘‘Retail Liquidity 

Program’’ or the ‘‘Program’’), which is 

currently scheduled to expire on March 

31, 2015, until September 30, 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, 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 purpose of this filing is to extend 

the pilot period of the Retail Liquidity 

Program,3 currently scheduled to expire 

on March 31, 2015, until September 30, 

2015. 

Background 

In July 2012, the Commission 

approved the Retail Liquidity Program 

on a pilot basis.4 The Program is 

designed to attract retail order flow to 

the Exchange, and allows such order 

flow to receive potential price 

improvement. The Program is currently 

limited to trades occurring at prices 

equal to or greater than $1.00 per share. 

Under the Program, Retail Liquidity 

Providers (‘‘RLPs’’) are able to provide 

potential price improvement in the form 

of a non-displayed order that is priced 

better than the Exchange’s best 

protected bid or offer (‘‘PBBO’’), called 

a Retail Price Improvement Order 

(‘‘RPI’’). When there is an RPI in a 

particular security, the Exchange 

disseminates an indicator, known as the 

Retail Liquidity Identifier, indicating 

that such interest exists. Retail Member 

Organizations (‘‘RMOs’’) can submit a 

Retail Order to the Exchange, which 

would interact, to the extent possible, 

with available contra-side RPIs. 


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13048 Federal Register / Vol. 80, No. 48 / Thursday, March 12, 2015 / Notices 

5See id. at 40681. 

6Concurrently with this filing, the Exchange has 

submitted a request for an extension of the 

exemption under Regulation NMS Rule 612 

previously granted by the Commission that permits 

it to accept and rank the undisplayed RPIs. See 

Letter from Martha Redding, Senior Counsel, NYSE 

Group, Inc. to Brent J. Fields, Secretary, Securities 

and Exchange Commission, dated February 27, 

2015. 

7 15 U.S.C. 78f(b). 

8 15 U.S.C. 78f(b)(5). 

9 15 U.S.C. 78s(b)(3)(A)(iii). 

10 17 CFR 240.19b–4(f)(6). 

11 17 CFR 240.19b–4(f)(6). 

12 17 CFR 240.19b–4(f)(6)(iii). 13 15 U.S.C. 78s(b)(2)(B). 

The Retail Liquidity Program was 

approved by the Commission on a pilot 

basis. Pursuant to NYSE MKT Rule 

107C(m)—Equities, the pilot period for 

the Program is scheduled to end on 

March 31, 2015. 

Proposal To Extend the Operation of the 

Program 

The Exchange established the Retail 

Liquidity Program in an attempt to 

attract retail order flow to the Exchange 

by potentially providing price 

improvement to such order flow. The 

Exchange believes that the Program 

promotes competition for retail order 

flow by allowing Exchange members to 

submit RPIs to interact with Retail 

Orders. Such competition has the ability 

to promote efficiency by facilitating the 

price discovery process and generating 

additional investor interest in trading 

securities, thereby promoting capital 

formation. The Exchange believes that 

extending the pilot is appropriate 

because it will allow the Exchange and 

the Commission additional time to 

analyze data regarding the Program that 

the Exchange has committed to 

provide.5 As such, the Exchange 

believes that it is appropriate to extend 

the current operation of the Program.6

Through this filing, the Exchange seeks 

to amend NYSE MKT Rule 107C(m)— 

Equities and extend the current pilot 

period of the Program until September 

30, 2015. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the Act,7

in general, and furthers the objectives of 

Section 6(b)(5),8 in particular, in that 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. The Exchange believes 

that extending the pilot period for the 

Retail Liquidity Program is consistent 

with these principles because the 

Program is reasonably designed to 

attract retail order flow to the exchange 

environment, while helping to ensure 

that retail investors benefit from the 

better price that liquidity providers are 

willing to give their orders. 

Additionally, as previously stated, the 

competition promoted by the Program 

may facilitate the price discovery 

process and potentially generate 

additional investor interest in trading 

securities. The extension of the pilot 

period will allow the Commission and 

the Exchange to continue to monitor the 

Program for its potential effects on 

public price discovery, and on the 

broader market structure. 

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 that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

proposed rule change simply extends an 

established pilot program for an 

additional six months, thus allowing the 

Retail Liquidity Program to enhance 

competition for retail order flow and 

contribute to the public price discovery 

process. 

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 Exchange has filed the proposed 

rule change pursuant to Section 

19(b)(3)(A)(iii) of the Act 9 and Rule 

19b–4(f)(6) thereunder.10 Because the 

proposed rule change does not: (i) 

Significantly affect the protection of 

investors or the public interest; (ii) 

impose any significant burden on 

competition; and (iii) become operative 

prior to 30 days from the date on which 

it was filed, or such shorter time as the 

Commission may designate, if 

consistent with the protection of 

investors and the public interest, the 

proposed rule change has become 

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

of the Act and Rule 19b–4(f)(6)(iii) 

thereunder. 

A proposed rule change filed under 

Rule 19b–4(f)(6) 11 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b4(f)(6)(iii),12 the Commission 

may designate a shorter time if such 

action is consistent with the protection 

of investors and the public interest. 

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) 13 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– 

NYSEMKT–2015–14 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–NYSEMKT–2015–14. 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 


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Federal Register / Vol. 80, No. 48 / Thursday, March 12, 2015 / Notices 13049 

14 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The duration of the counting period is the same 

for all options traded on the Exchange and is 

published in an Options Trader Alert, which is 

available on the Exchange’s Web site. 

filing also will be available for 

inspection and copying at the principal 

offices 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– 

NYSEMKT–2015–14, and should be 

submitted on or before April 2, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Jill M. Peterson, 

Assistant Secretary. 

[FR Doc. 2015–05607 Filed 3–11–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74453; File No. SR–Phlx– 

2015–10] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend Rule 

1082.02 and .03 

March 6, 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 February 

23, 2015, NASDAQ OMX PHLX LLC 

(‘‘Phlx’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) a 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 amend 

Rule 1082.02 and .03, as described 

below. 

The text of the proposed rule change 

is below. Proposed new language is 

italicized. Proposed deletions are in 

brackets. 

* * * * * 

Rule 1082. Firm Quotations 

(a)–(d) No change. 

.01 No change. 

.02 Locked Markets. In the event that 

an SQT, RSQT, and/or specialist’s 

electronically submitted quotations 

interact with the electronically 

submitted quotations of other SQTs, 

RSQTs and/or the specialist, resulting in 

the dissemination of a ‘‘locked’’ 

quotation (e.g., $1.00 bid—1.00 offer), 

the [following shall occur: 

(a) The Exchange will disseminate the 

locked market and both quotations will 

be deemed ‘‘firm’’ disseminated market 

quotations; 

(b) A ‘‘counting period’’ not to exceed 

.25 of one second will begin during 

which SQTs, RSQTs and/or specialists 

whose quotations are locked may 

eliminate the locked market. Provided, 

however, that in accordance with 

subparagraph (a) above, such SQT, 

RSQT and/or specialist shall be 

obligated to execute orders at their 

disseminated quotation. The duration of 

the counting period will be established 

by the Exchange, will be the same for all 

options traded on the Exchange, and 

will not exceed .25 of one second. The 

duration of the counting period will be 

published in an Options Trader Alert, 

which will be available on the 

Exchange’s Web site. 

During the counting period SQTs and 

specialists located in the Crowd Area in 

which the option that is the subject of 

the locked market is traded will 

continue to be obligated to respond to 

Floor Brokers as set forth in Rule 1014, 

Commentary .05(c), and will continue to 

be obligated for one contract in open 

outcry to other SQTs, non-SQT ROTs, 

and specialists. If at the end of the 

counting period the quotations remain 

locked, the] locked quotations will 

automatically execute against each other 

in accordance with the allocation 

algorithm set forth in Rule 1014(g)(vii). 

[The quotation that is locked may be 

executed by an order during the 

counting period.] 

.03 Crossed Markets. The Exchange 

will not disseminate an internally 

crossed market (e.g., $1.10 bid, 1.00 

offer). If an SQT, RSQT or specialist 

electronically submits a quotation [in a 

Streaming Quote Option] (‘‘incoming 

quotation’’) that would cross an existing 

quotation (‘‘existing quotation’’), the 

Exchange will[: (i)] Change the 

incoming quotation such that it locks 

the existing quotation and automatically 

execute the locked quotations against 

each other in accordance with the 

allocation algorithm set forth in Rule 

1014(g)(vii). 

[; (ii) send a notice to the SQT, RSQT 

or specialist that submitted the existing 

quotation indicating that its quotation 

was crossed; and (iii) send a notice to 

the specialist, SQT or RSQT that 

submitted the incoming quotation, 

indicating that its quotation crossed the 

existing quotation and was changed. 

Such a locked market shall be handled 

in accordance with Commentary .01 

above. During the counting period, if the 

existing quotation is cancelled 

subsequent to the time the incoming 

quotation is changed, the incoming 

quotation will automatically be restored 

to its original terms.] 

* * * * * 

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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposal is to 

amend two commentaries to Rule 1082 

because the timers no longer operate. 

Rule 1082.02 currently addresses what 

occurs when a Streaming Quote Trader’s 

(‘‘SQT’’), Remote SQT’s (‘‘RSQT’’), and/ 

or specialist’s electronically submitted 

quotations interact with the 

electronically submitted quotations of 

other SQTs, RSQTs and/or the 

specialist. Under this provision, the 

Exchange disseminates the resulting 

locked market and both quotations are 

deemed ‘‘firm’’ disseminated market 

quotations. Furthermore, a counting 

period not to exceed .25 of one second 

may begin during which SQTs, RSQTs 

and/or specialists whose quotations are 

locked may eliminate the locked market, 

provided, however, that such SQT, 

RSQT and/or specialist shall 

nevertheless be obligated to execute 

orders at that price. The rule provides 

that the duration of the counting period 

is established by the Exchange, will be 

the same for all options traded on the 

Exchange and will not exceed .25 of one 

second.3 In March 2010, the Exchange 

reduced this counting period to zero, 

which is within the range contemplated 

by the rule (does not exceed .25 of one 


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