Federal Register / Vol. 79, No. 222 / Tuesday, November 18, 2014 / Notices 68743 

19 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. 73354 

(October 15, 2014), 79 FR 203 (October 21, 2014) 

(SR–CBOE–2014–75). 

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– 

Phlx–2014–72 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–Phlx–2014–72. 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 the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–Phlx– 

2014–72 and should be submitted on or 

before December 9, 2014. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–27212 Filed 11–17–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73575; File No. SR–CBOE– 

2014–084] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend the Fees 

Schedule 

November 12, 2014. 

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 November 

3, 2014, Chicago Board Options 

Exchange, Incorporated (the ‘‘Exchange’’ 

or ‘‘CBOE’’) filed with the Securities 

and Exchange Commission (the 

‘‘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 amend its 

Fees Schedule. The text of the proposed 

rule change is available on the 

Exchange’s Web site (http://

www.cboe.com/AboutCBOE/

CBOELegalRegulatoryHome.aspx), 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 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 Exchange proposes to amend its 

Fees Schedule, effective November 3, 

2014. The Exchange always strives for 

clarity in its rules and Fees Schedule, so 

that market participants may best 

understand how rules and fees apply. 

First, the Exchange proposes to remove 

obsolete language in Footnotes 29 and 

30. On October 1, 2014, the Exchange 

submitted a rule filing to amend its 

Order Router Subsidy (‘‘ORS’’) and 

Complex Order Router Subsidy 

(‘‘CORS’’) Programs (collectively 

‘‘Programs’’).3 In the filing, among other 

things, the Exchange proposed to cease 

making payments under both Programs 

with respect to executed contracts in 

mini-option classes. The Exchange 

however, inadvertently did not remove 

the following statement from Footnotes 

29 and 30: ‘‘For billing purposes, minioptions fees will be rounded to the 

nearest $0.01 using standard rounding 

rules.’’ As mini-options are no longer 

part of either Program, reference to how 

mini-option fees would be billed under 

the program is unnecessary. The 

Exchange proposes to remove the 

obsolete language, which will prevent 

potential confusion and maintain clarity 

in the Fees Schedule. 

The Exchange also proposes to amend 

its OHS (Order Handling System) Order 

Cancellation Fee (‘‘Cancel Fee’’). By way 

of background, the Exchange had 

established this fee to address various 

operational problems and recoup costs 

resulting from the practice of 

immediately following orders routed 

through the OHS with a cancel request. 

Currently, the executing Clearing 

Trading Permit Holder is charged $2.00 

for every public customer order (origin 

code ‘‘C’’) that it cancels through the 

OHS in any month where the total 

number of cancellations sent by the 

executing Clearing Trading Permit 

Holder is in excess of the number of 

public customer orders that the 

executing Clearing Trading Permit 

Holder executes in a month for itself or 

for a correspondent firm. Additionally, 

this fee does not apply: (i) if an 

executing Clearing Trading Permit 

Holder cancels less than 500 public 

customer orders through OHS in a 

month for itself or for a correspondent 

firm; (ii) to cancelled OHS orders that 

improve the Exchange’s prevailing bidoffer (BBO) market at the time the orders 

are received; (iii) to fill and cancellation 

activity occurring within the first one 

minute of trading following the opening 

of each options class, (iv) to complex 

order fills and cancels, (v) to unfilled 

Fill-or-Kill (FOK) orders, (vi) to unfilled 

Immediate-or-Cancel (IOC) orders, and 


tkelley on DSK3SPTVN1PROD with NOTICES
68744 Federal Register / Vol. 79, No. 222 / Tuesday, November 18, 2014 / Notices 

4 15 U.S.C. 78f(b). 

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

6 Id. 

7 15 U.S.C. 78f(b)(4). 

8See Securities Exchange Act Release No. 72817 

(August 12, 2014), 79 FR 48801 (August 18, 2014) 

(SR–ISE–2014–039). 

9 Id. 

10 15 U.S.C. 78s(b)(3)(A). 

11 17 CFR 240.19b–4(f). 

(vii) to orders that are entered or 

cancelled prior to the opening, during 

the opening rotation, or during a trading 

halt. The Exchange now proposes to 

waive the cancellation fee. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) and the rules and regulations 

thereunder applicable to the Exchange 

and, in particular, the requirements of 

Section 6(b) of the Act.4 Specifically, 

the Exchange believes the proposed rule 

change is consistent with the Section 

6(b)(5) 5 requirements that the rules of 

an exchange be designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in regulating, clearing, settling, 

processing information with respect to, 

and facilitation transactions in 

securities, 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. 

Additionally, the Exchange believes the 

proposed rule change is consistent with 

the Section 6(b)(5) 6 requirement that 

the rules of an exchange not be designed 

to permit unfair discrimination between 

customers, issuers, brokers, or dealers. 

The Exchange also believes the 

proposed rule change is consistent with 

Section 6(b)(4) of the Act,7 which 

requires that Exchange rules provide for 

the equitable allocation of reasonable 

dues, fees, and other charges among its 

Trading Permit Holders and other 

persons using its facilities. 

In particular, the Exchange believes 

that the proposed clarifications to the 

Fees Schedule will make the Fees 

Schedule easier to read and alleviate 

potential confusion. The alleviation of 

potential confusion will 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 Exchange believes that it is 

reasonable and equitable to waive the 

cancellation fee. The cancellation fee 

was originally introduced in response to 

capacity concerns stemming from 

Trading Permit Holders generating 

significant order traffic that did not 

result in executed trades due to orders 

being cancelled at high rates. However, 

the total number of monthly cancelled 

fees assessed has decreased over time. 

As such, the Exchange believes the fee 

may no longer be necessary. The 

Exchange believes it’s reasonable to 

waive the cancellation fee because it 

will merely result in Trading Permit 

Holders no longer being subject to this 

fee. Additionally, the Exchange notes 

that another exchange has similarly 

waived its Cancellation Fee.8 The 

Exchange does not believe the proposed 

change is unfairly discriminatory as it 

applies equally to all Trading Permit 

Holders, who will no longer be subject 

to any cancellation fees. 

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. CBOE does 

not believe that the proposed rule 

change will impose any burden on 

intramarket competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act because the 

proposed changes apply to all Trading 

Permit Holders. The Exchange believes 

that the proposal to waive the 

cancellation fee will not cause an 

unnecessary burden on intermarket 

competition because at least one other 

exchange has similarly waived its 

cancellation fee.9 To the extent that the 

proposed changes make CBOE a more 

attractive marketplace for market 

participants at other exchanges, such 

market participants are welcome to 

become CBOE market participants. 

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 written comments on the 

proposed rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

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

of the Act 10 and paragraph (f) of Rule 

19b–4 11 thereunder. 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 will institute proceedings 

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– 

CBOE–2014–084 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–CBOE–2014–084. 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 the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–CBOE– 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 222 / Tuesday, November 18, 2014 / Notices 68745 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3For example, a Workstation subscription 

includes tools to assist member firms in complying 

with Regulation NMS short sale restrictions and 

compliance with the Limit Up/Limit Down process. 

See http://www.nasdaqtrader.com/

Trader.aspx?id=Workstation. 

4See Rule 4753(a)(3)(A). 

5See Rule 4753(a)(5). 

6See Rule 4753(a)(1). 

7See Rule 4753(b) for a description of the 

processing of the Halt Cross. 

8The Pre-Launch Period is the second phase of 

a two-phase process that NASDAQ uses for 

launching IPOs. The Pre-Launch Period follows a 

15-minute Display Only Period and is of no fixed 

duration. During both periods, the NOII is 

disseminated every five seconds. 

2014–084 and should be submitted on 

or before December 9, 2014. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–27186 Filed 11–17–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73574; File No. SR– 

NASDAQ–2014–100] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing of a Proposed Rule Change To 

Amend NASDAQ Rule 7015(d) To 

Include the IPO Indicator as a New 

Enhancement to the NASDAQ 

Workstation 

November 12, 2014. 

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 October 

29, 2014 The NASDAQ Stock Market 

LLC (‘‘NASDAQ’’ or the ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) a 

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 the Substance 

of the Proposed Rule Change 

NASDAQ proposes a rule change 

proposal to amend NASDAQ Rule 

7015(d) to include the IPO Indicator as 

a new enhancement to a NASDAQ 

Workstation subscription. 

The text of the proposed rule change 

is available at http://

nasdaq.cchwallstreet.com/, at 

NASDAQ’s principal office, 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, 

NASDAQ 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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

NASDAQ is amending Rule 7015(d) to 

include the IPO Indicator as a new 

enhancement to the NASDAQ 

Workstation. In addition to providing 

order entry and quote functionality, the 

NASDAQ Workstation also includes 

several features designed to assist 

subscribers with managing and 

monitoring their trading activity.3

NASDAQ is proposing to include a new 

feature designed to assist member firms 

in monitoring their orders in the 

NASDAQ Halt Cross process leading up 

to the launch of an initial public 

offering (‘‘IPO’’). 

Halt Cross Process 

The NASDAQ Halt Cross is designed 

to provide for an orderly, single-priced 

opening of securities subject to an 

intraday halt, including securities that 

are the subject of an IPO. Prior to the 

Cross execution, market participants 

enter quotes and orders eligible for 

participation in the Cross, and NASDAQ 

disseminates certain information 

regarding buying and selling interest 

entered and the indicative execution 

price information, known as the Net 

Order Imbalance Indicator or NOII. The 

NOII is disseminated every five seconds 

during a designated period prior to the 

completion of the Halt Cross, in order to 

provide market participants with 

information regarding the possible price 

and volume of the Cross. The 

information provided in the NOII 

message includes the Current Reference 

Price,4 which is the price at which the 

Cross would occur if it executed at the 

time of the NOII’s dissemination, and 

the number of shares of Eligible 

Interest,5 which is defined as any 

quotation or any order that may be 

entered into the system and designated 

with a time-in-force that would allow 

the order to be in force at the time of 

the Halt Cross, that would be paired at 

that price. 

NASDAQ also disseminates a Market 

Order Imbalance, which is defined as 

the number of shares of Eligible Interest 

entered through market orders that 

would not be matched with other order 

shares at the time of the dissemination 

of an NOII, if in fact there are such 

unexecutable market order shares. 

When there is a Market Order 

Imbalance, NASDAQ disseminates the 

imbalance and the buy/sell direction of 

the imbalance. For example, if a buydirection Market Order Imbalance is 

disseminated, potential sellers in the 

Cross would know that buy liquidity is 

available at a market price, potentially 

encouraging them to enter additional 

sell orders to allow the Cross to proceed. 

In addition to disseminating 

information about Market Order 

Imbalances, NASDAQ also disseminates 

information about the size and buy/sell 

direction of an Imbalance. An Imbalance 

is defined as the number of shares of 

Eligible Interest with a limit price equal 

to the Current Reference Price that may 

not be matched with other order shares 

at a particular price at any given time.6

As noted above, Eligible Interest is 

defined as any quotation or any order 

that may be entered into the system and 

designated with a time-in-force that 

would allow the order to be in force at 

the time of the Halt Cross. Thus, the 

provided information reflects all shares 

eligible for participation in the Cross, 

regardless of time-in-force, and includes 

non-displayed shares and reserve size. 

As such, the Imbalance information 

indicates the degree to which available 

liquidity on one or the other side of the 

market would not be executed if the 

Cross were to occur at that time. 

Generally, a Halt in a security is 

terminated when NASDAQ determines 

to release a security, at which time the 

Display Only Period begins, culminating 

in the Halt Cross whereby the security 

is released for regular hours trading at 

the price that maximizes the number of 

shares of trading interest eligible for 

participation in the Cross to be 

executed.7 In the case of an IPO, 

underwriters to an IPO make a 

determination to launch an IPO during 

the Pre-Launch Period 8 when they 

believe the security is ready to trade. 

When the underwriter informs 


tkelley on DSK3SPTVN1PROD with NOTICES