Federal Register / Vol. 79, No. 224 / Thursday, November 20, 2014 / Notices 69153 

33See Securities Exchange Act Release No. 72689 

(July 28, 2014), 79 FR 44917 (August 1, 2014) (SR– 

EDGA–2014–16). 

34See Letter from Suzanne Hamlet Shatto to the 

Commission, dated August 19, 2014 (SR–EDGA– 

2014–16) (‘‘Shatto Letter’’) (letter commenting on 

companion EDGA filing that proposes to offer the 

same feed). 

35But see Letter from Sal Arnuk and Joe Saluzzi, 

Themis Trading LLC, to Elizabeth M. Murphy, 

Secretary, Commission, dated August 21, 2014 (SR– 

BATS–2014–028) (‘‘Themis Letter’’); Letter from Ira 

D. Hammerman, General Counsel, SIFMA, to Kevin 

O’Neill, Deputy Secretary, Commission, dated 

August 22, 2014 (SR–BATS–2014–028) (‘‘SIFMA 

Letter’’) (letters commenting on companion BATS 

filing that proposes to offer the same feed). 

36See Securities Exchange Act Release No. 73098 

(September 15, 2014), 79 FR 56415 (September 19, 

2014). 

37 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

these functions as part of creating its 

proprietary market data products and is 

able to allocate these costs over 

numerous products and customer 

relationships. For these reasons, the 

Exchange believes that vendors could 

readily offer a product similar to the 

BATS One Feed on a competitive basis 

at a similar cost. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

A similar proposed rule change was 

initially filed with the Commission on 

July 14, 2014 and published for 

comment in the Federal Register on 

August 1, 2014.33 The Commission 

received one comment letter in response 

to that proposed rule change.34 In 

addition, two letters were submitted to 

the Commission commenting on a 

companion BZX filing that proposed to 

offer the same feed.35 On September 15, 

2014, the Commission extended its 

review period until October 30, 2014.36

On October 29, 2014, the Exchange 

withdrew the initial proposed rule 

change. The points raised by the Themis 

Letter and Shatto Letter are either not 

responsive to the issues raised in the 

proposal or aimed at existing elements 

of U.S. market structure that have been 

previously approved by the 

Commission. 

The thrust of the SIFMA Letter is 

aimed at the proposed fees which are 

being removed from this proposed rule 

change and are to be filed with the 

Commission via a separate rule filing. 

While the SIFMA Letter correctly states 

that the Exchange has marketed the 

BATS One Feed since August 1, 2014, 

the SIFMA Letter incorrectly asserts that 

the Exchange has offered the BATS One 

Feed since that same date. All of the 

Exchange’s marketing materials have 

included statements that the BATS One 

Feed’s implementation was pending to 

SEC approval, and at no point has the 

Exchange offered the BATS One product 

for any use other than for testing and 

certification. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 45 days of the date of 

publication of this notice in the Federal 

Register or within such longer period 

up to 90 days of such date (i) as the 

Commission may designate if it finds 

such longer period to be appropriate 

and publishes its reasons for so finding 

or (ii) as to which the Exchange 

consents, the Commission shall: 

(A) By order approve or disapprove 

such proposed rule change, or 

(B) institute proceedings to determine 

whether the proposed rule change 

should be 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–2014–25 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–2014–25. 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 EDGA. 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– 

2014–25 and should be submitted on or 

before December 11, 2014. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.37

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–27445 Filed 11–19–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73593; File No. SR– 

NYSEMKT–2014–95] 

Self-Regulatory Organizations; NYSE 

MKT LLC; Notice of Filing of Proposed 

Rule Change Amending Rule 13— 

Equities and Related Rules Governing 

Order Types and Modifiers To Clarify 

the Nature of Order Types 

November 14, 2014. 

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 October 

31, 2014, NYSE MKT LLC (‘‘Exchange’’ 

or ‘‘NYSE MKT’’) 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 self-regulatory 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 

Rule 13—Equities and related rules 

governing order types and modifiers. 

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. 


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4See Mary Jo White, Chair, Securities and 

Exchange Commission, Speech at the Sandler, 

O’Neill & Partners, L.P. Global Exchange and 

Brokerage Conference (June 5, 2014) (available at 

www.sec.gov/News/Speech/Detail/Speech/ 

1370542004312#.U5HI-fmwJiw). 

5See Letter from James Burns, Deputy Director, 

Division of Trading and Markets, Securities and 

Exchange Commission, to Jeffrey C. Sprecher, Chief 

Executive Officer, Intercontinental Exchange, Inc., 

dated June 20, 2014. 

6See Securities Exchange Act Release No. 71898 

(April 8, 2014), 79 FR 20957 (April 14, 2014) (SR– 

NYSEMKT–2014–27) (amending rules governing 

pegging interest to conform to functionality that is 

available at the Exchange). 

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

68305 (Nov. 28, 2012), 77 FR 71853 (Dec. 4, 2012) 

(SR–NYSEMKT–2012–67) (amending rules 

governing pegging interest to, among other things, 

make non-substantive changes, including moving 

the rule text from Rule 70.26—Equities to Rule 13, 

to make the rule text more focused and streamlined) 

(‘‘2012 Pegging Filing’’), and 71175 (Dec. 23, 2013), 

78 FR 79534 (Dec. 30, 2013) (SR–NYSEMKT–2013– 

25) (approval order for rule proposal that, among 

other things, amended Rule 70 governing Floor 

broker reserve e-quotes that streamlined the rule 

text without making substantive changes) (‘‘2013 

Reserve e-Quote Filing’’). 

8The Exchange notes that its affiliated exchanges, 

New York Stock Exchange LLC (‘‘NYSE’’) and 

NYSE Arca, Inc. are proposing similar restructuring 

of their respective order type rules to group order 

types and modifiers. See SR–NYSE–2014–59 and 

SR–NYSEArca–2014–130. 

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 

On June 5, 2014, in a speech entitled 

‘‘Enhancing Our Market Equity 

Structure,’’ Mary Jo White, Chair of the 

Securities and Exchange Commission 

(‘‘SEC’’ or the ‘‘Commission’’) requested 

the equity exchanges to conduct a 

comprehensive review of their order 

types and how they operate in practice, 

and as part of this review, consider 

appropriate rule changes to help clarify 

the nature of their order types.4

Subsequent to the Chair’s speech, the 

SEC’s Division of Trading and Markets 

requested that the equity exchanges 

complete their reviews and submit any 

proposed rule changes by November 1, 

2014.5

The Exchange notes that it 

continually assesses its rules governing 

order types and undertook on its own 

initiative a review of its rules related to 

order functionality to assure that its 

various order types, which have been 

adopted and amended over the years, 

accurately describe the functionality 

associated with those order types, and 

more specifically, how different order 

types may interact. As a result of that 

review, the Exchange submitted a 

proposed rule change to delete rules 

relating to functionality that was not 

available.6 In addition, over the years, 

when filing rule changes to adopt new 

functionality, the Exchange has used 

those filings as an opportunity to 

streamline related existing rule text for 

which functionality has not changed.7

The Exchange is filing this proposed 

rule change to continue with its efforts 

to review and clarify its rules governing 

order types, as appropriate. Specifically, 

the Exchange notes that Rule 13— 

Equities (‘‘Rule 13’’) is currently 

structured alphabetically, and does not 

include subsection numbering. The 

Exchange proposes to provide 

additional clarity to Rule 13 by regrouping and re-numbering current rule 

text and making other non-substantive, 

clarifying changes. The proposed rule 

changes are not intended to reflect 

changes to functionality but rather to 

clarify Rule 13 to make it easier to 

navigate.8 In addition, the Exchange 

proposes to amend certain rules to 

remove references to functionality that 

is no longer operative. 

Proposed Rule 13 Restructure 

The Exchange proposes to re-structure 

Rule 13 to re-group existing order types 

and modifiers together along functional 

lines. 

Proposed new subsection (a) of Rule 

13 would set forth the Exchange’s order 

types that are the foundation for all 

other order type instructions, i.e., the 

primary order types. The proposed 

primary order types would be: 

• Market Orders. Rule text governing 

Market Orders would be moved to new 

Rule 13(a)(1). The Exchange proposes a 

non-substantive change to replace the 

reference to ‘‘Display Book’’ with a 

reference to ‘‘Exchange systems.’’ The 

Exchange notes that it proposes to 

capitalize the term ‘‘Market Order’’ 

throughout new Rule 13. 

• Limit Orders. Rule text governing 

Limit Orders would be moved to new 

Rule 13(a)(2). The Exchange proposes a 

non-substantive change to capitalize the 

term ‘‘Limit Order,’’ and to shorten the 

definition in a manner that streamlines 

the rule text without changing the 

meaning of the rule. The Exchange notes 

that it proposes to capitalize the term 

‘‘Limit Order’’ throughout new Rule 13. 

The Exchange notes that it proposes 

to delete the definition of ‘‘Auto Ex 

Order’’ because all orders entered 

electronically at the Exchange are 

eligible for automatic execution in 

accordance with Rules 1000–1004— 

Equities and therefore the Exchange 

does not believe that it needs to 

separately define an Auto Ex Order. 

Rather than maintain a separate 

definition, the Exchange proposes to 

specify in proposed Rule 13(a) that all 

orders entered electronically at the 

Exchange are eligible for automatic 

execution consistent with the terms of 

the order and Rules 1000—1004— 

Equities. The Exchange notes that Rule 

13 currently provides for specified 

instructions for orders that may not 

execute on arrival, even if marketable, 

e.g., a Limit Order designated ALO, or 

may only be eligible to participate in an 

auction, accordingly, the terms of the 

order also control whether a marketable 

order would automatically execute upon 

arrival. The Exchange further proposes 

to specify that interest represented 

manually by Floor brokers, i.e., orally 

bid or offered at the point of sale on the 

Trading Floor, is not eligible for 

automatic execution. The Exchange 

notes that the order types currently 

specified in the definition for auto ex 

order are already separately defined in 

Rule 13 or Rule 70(a)(ii)—Equities 

(definition of G order). 

Proposed new subsection (b) of Rule 

13 would set forth the existing Time in 

Force Modifiers that the Exchange 

makes available for orders entered at the 

Exchange. The Exchange proposes to: (i) 

Move rule text governing Day Orders to 

new Rule 13(b)(1), without any 

substantive changes to the rule text; (ii) 

move rule text governing Good til 

Cancelled Orders to new Rule 13(b)(2), 

without any substantive changes to the 

rule text; and (iii) move rule text 

governing Immediate or Cancel Orders 

to new Rule 13(b)(3) without any 

changes to rule text. The Exchange notes 

that these time-in-force conditions are 

not separate order types, but rather are 

modifiers to orders. Accordingly, the 

Exchange proposes to re-classify them 

as modifiers and remove the references 

to the term ‘‘Order.’’ In addition, as 

noted above, the Exchange proposes to 

capitalize the term ‘‘Limit Order’’ in 

Rule 13(b). 

Proposed new subsection (c) of Rule 

13 would specify the Exchange’s 

existing Auction-Only Orders. In 

moving the rule text, the Exchange 

proposes the following non-substantive 


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9See Rule 123C.10—Equities (‘‘Closings may be 

effectuated manually or electronically’’) and Rule 

123D(1)—Equities (‘‘Openings may be effectuated 

manually or electronically’’). 10The Exchange notes that because of technology 

changes associated with rejecting MPL Orders that 

have an MTV larger than the size of the order, the 

Exchange will announce by Trader Update when 

this element of the proposed rule change will be 

implemented. 

11See Rule 70.25—Equities (Discretionary 

Instructions for Bids and Offers Represented via 

Floor Broker Agency Interest Files (e-QuotesSM)). 

12On October 1, 2008, the Commission approved 

the Exchange’s rule proposal to establish new 

membership, member firm conduct, and equity 

trading rules that were based on the existing NYSE 

rules to reflect that equities trading on the Exchange 

would be supported by the NYSE’s trading system. 

See Securities Exchange Act Release No. 58705 

(Oct. 1, 2008), 73 FR 58995 (Oct. 8. 2008) (SR– 

Amex–2008–63) (approval order). Because the 

Exchange’s rules are based on the existing NYSE 

rules, the Exchange believes that pre-October 1, 

2008 NYSE rule filings provide guidance 

concerning Exchange equity rules. See Securities 

Exchange Act Release No. 57688 (April 18, 2008), 

73 FR 22194 at 22197 (April 24, 2008) (SR–NYSE– 

2008–30) (order approving NYSE rule change that, 

among other things, adopted new Reserve Order for 

which the non-displayed portion of the order is 

eligible to participate in manual executions) (‘‘2008 

Reserve Order Filing’’). 

13See 2013 Reserve e-Quote Filing, supra n. 7. 

14See Securities Exchange Act Release No. 58845 

(Oct. 24, 2008), 73 FR 64379 at 64384 (Oct. 29, 

2008) (SR–NYSE–2008–46) (order approving the 

NYSE’s New Market Model, including adopting a 

Non-Displayed Reserve Order that would not be 

eligible to participate in manual executions); see 

also Securities Exchange Act Release No. 59022 

(Nov. 26, 2008), 73 FR 73683 (Dec. 3, 2008) (SR– 

NYSEALTR–2008–10) (notice of filing and 

immediate effectiveness of rule change to conform 

Exchange equity rules with NYSE rules, including 

adopting NYSE New Market Model and related 

changes to adoption of a Non-Displayed Reserve 

Order). 

15See 2013 Reserve e-Quote Filing, supra n. 7. 

16See 2008 Reserve Order Filing supra n. 12 at 

22196 (displayable portion of Reserve Order 

executed together with other displayable interest at 

a price point before executing with reserve portion 

of the order). 

changes: (i) Capitalize the terms ‘‘Limit 

Order,’’ ‘‘CO Order,’’ and ‘‘Market 

Order’’; (ii) move the rule text for CO 

Orders to new Rule 13(c)(1); (iii) rename 

a ‘‘Limit ‘At the Close’ Order’’ as a 

‘‘Limit-on-Close (LOC) Order’’ and move 

the rule text to new Rule 13(c)(2); (iv) 

rename a ‘‘Limit ‘On-the-Open’ Order’’ 

as a ‘‘Limit-on-Open (LOO) Order’’ and 

move the rule text to new Rule 13(c)(3); 

(v) rename a ‘‘Market ‘At-the-Close’ 

Order’’ as a ‘‘Market-on-Close (MOC) 

Order’’ and move the rule text to new 

Rule 13(c)(4); and (vi) rename a ‘‘Market 

‘On-the-Open’ Order’’ as a ‘‘Market-onOpen (MOO) Order’’ and move the rule 

text to new Rule 13(c)(5). 

Proposed new subsection (d) of Rule 

13 would specify the Exchange’s 

existing orders that include instructions 

not to display all or a portion of the 

order. The order types proposed to be 

included in this new subsection are: 

• Mid-point Passive Liquidity 

(‘‘MPL’’) Orders. Existing rule text 

governing MPL Orders would be moved 

to new Rule 13(d)(1) with nonsubstantive changes to capitalize the 

term Limit Order, update cross 

references, and refer to ‘‘Add Liquidity 

Only’’ as ALO, since ALO is now a 

separately defined term in new Rule 

13(e)(1). The Exchange also proposes to 

clarify the rule text by deleting the term 

‘‘including’’ from the phrase ‘‘[a]n MPL 

Order is not eligible for manual 

executions, including openings, reopenings, and closings,’’ because MPL 

Orders would not participate in an 

opening, re-opening, or closing that is 

effectuated electronically.9 The 

Exchange further proposes to make a 

substantive amendment to the rule text 

set forth in new Rule 13(d)(1)(C) to 

specify that Exchange systems would 

reject an MPL Order on entry if the 

Minimum Triggering Volume (‘‘MTV’’) 

is larger than the size of the order and 

would reject a request to partially cancel 

a resting MPL Order if it would result 

in the MTV being larger than the size of 

the order and make conforming changes 

to the existing rule text. The Exchange 

would continue to enforce an MTV 

restriction if the unexecuted portion of 

an MPL Order with an MTV is less than 

the MTV. The Exchange believes that 

this proposed rule change would 

prevent an entering firm from causing 

an MPL Order to have an MTV that is 

larger than the order, thereby bypassing 

contra-side interest that is larger than 

the size of the MPL Order.10 Finally, the 

Exchange proposes to make a nonsubstantive change to new Rule 

13(d)(1)(E) to replace the term 

‘‘discretionary trade’’ with ‘‘d-Quote,’’ 

because d-Quotes are the only type of 

Exchange interest that is eligible to 

include discretionary pricing 

instructions.11

• Reserve Orders. Existing rule text 

governing Reserve Orders would be 

moved to new Rule 13(d)(2) with nonsubstantive changes to capitalize the 

term ‘‘Limit Order’’ and hyphenate the 

term ‘‘Non-Displayed.’’ The Exchange 

proposes further non-substantive 

changes to the rule text governing 

Minimum Display Reserve Orders, 

which would be in new Rule 

13(d)(2)(C), to clarify that a Minimum 

Display Reserve Order would 

participate in both automatic and 

manual executions. This is existing 

functionality relating to Minimum 

Display Reserve Orders 12 and the 

proposed rule text aligns with Rule 

70(f)(i)—Equities governing Floor broker 

Minimum Display Reserve e-Quotes.13

Similarly, the Exchange proposes nonsubstantive changes to the rule text 

governing Non-Displayed Reserve 

Orders, which would be in new Rule 

13(d)(2)(D), to clarify that a NonDisplayed Reserve Order would not 

participate in manual executions. This 

is existing functionality relating to NonDisplayed Reserve Orders 14 and the 

proposed rule text aligns with Rule 

70(f)(ii)—Equities governing NonDisplay Reserve eQuotes excluded from 

the DMM.15 Finally, in proposed new 

Rule 13(d)(2)(E), the Exchange proposes 

to clarify that the treatment of reserve 

interest, which is available for execution 

only after all displayable interest at that 

price point has been executed, is 

applicable to all Reserve Orders, and is 

not limited to Non-Displayed Reserve 

Orders.16

Proposed new subsection (e) of Rule 

13 would specify the Exchange’s 

existing order types that, by definition, 

do not route. The order types proposed 

to be included in this new subsection 

are: 

• Add Liquidity Only (‘‘ALO’’) 

Modifiers. Existing rule text governing 

ALO modifiers would be moved to new 

Rule 13(e)(1) with non-substantive 

changes to capitalize the term ‘‘Limit 

Order’’ and update cross-references. 

Existing rule text that is being moved to 

new Rule 13(e)(1)(A) currently provides 

that Limit Orders designated ALO may 

participate in opens and closes, but that 

the ALO instructions would be ignored. 

Because Limit Orders designated ALO 

could also participate in re-openings, 

and the ALO instructions would 

similarly be ignored, the Exchange 

proposes to clarify new Rule 13(e)(1)(A) 

to provide that Limit Orders designated 

ALO could participate in openings, reopenings, and closings, but that the 

ALO instructions would be ignored. 

• Do Not Ship (‘‘DNS’’) Orders. 

Existing rule text governing DNS Orders 

would be moved to new Rule 13(e)(2) 

with non-substantive changes to 

capitalize the term ‘‘Limit Order’’ and 

replace the reference to ‘‘Display Book’’ 

with a reference to ‘‘Exchange systems.’’ 

• Intermarket Sweep Order. Existing 

rule text governing ISOs would be 

moved to new Rule 13(e)(3) with nonsubstantive changes to capitalize the 

term ‘‘Limit Order’’, update crossreferences, and replace the reference to 

‘‘Display Book’’ with a reference to 

‘‘Exchange’s book.’’ 

Proposed new subsection (f) of Rule 

13 would specify the Exchange’s other 

existing order instructions and 

modifiers, including: 

• Do Not Reduce (‘‘DNR’’) Modifier. 

Existing rule text governing DNR Orders 

would be moved to new Rule 13(f)(1) 


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17See Securities Exchange Act Release Nos. 

71329 (Jan. 16, 2014), 79 FR 3904 (Jan. 23, 2014) 

(SR–NYSEMKT–2013–84) (approval order for the 

Exchange’s adoption of the MPL Order); and 67347 

(July 3, 2012), 77 FR 40673 (July 10, 2012) (SR– 

NYSEAmex–2011–84) (approval order for the 

Exchange’s Retail Liquidity Program, which 

adopted the new RPI). 

18For example, assume the best protected bid 

(‘‘PBB’’) is $10.00, the Exchange has pegging 

interest to buy at $9.99, an MPL Order priced at 

$9.98 and a Non-Displayed Reserve Order to buy 

priced at $9.97. Because the PBB is outside the 

specified price range of the pegging interest to buy, 

it would peg to the next available best-priced 

interest, which in this scenario would be the NonDisplayed Reserve Order to buy priced at $9.97. The 

pegging interest to buy would not peg to the MPL 

Order to buy priced at $9.98. 

19See FINRA Regulatory Notice 11–29, Answer 3 

(June 2011) (‘‘Generally, a ‘not held’ order is an 

unpriced, discretionary order voluntarily 

categorized as such by the customer and with 

respect to which the customer has granted the firm 

price and time discretion.’’). See also Definition of 

Market Not Held Order on Nasdaq.com Glossary of 

Stock Market Terms, available at http://

www.nasdaq.com/investing/glossary/m/market-notheld-order. 

20See FINRA OATS Frequently Asked 

Questions—Technical, at T21 (‘‘An order submitted 

by a customer who gives the broker discretion as 

to the price and time of execution is denoted as a 

‘‘Not Held’’ order.’’), available at http://

www.finra.org/Industry/Compliance/

MarketTransparency/OATS/FAQ/P085542. 

with non-substantive changes to 

capitalize the terms ‘‘Limit Order’’ and 

‘‘Stop Order.’’ In addition, the Exchange 

believes that because DNR instructions 

would be added to an order, DNR is 

more appropriately referred to as a 

modifier rather than as an order type. 

• Do Not Increase (‘‘DNI’’) Modifiers. 

Existing rule text governing DNI Orders 

would be moved to new Rule 13(f)(2) 

with non-substantive changes to 

capitalize the terms ‘‘Limit Order’’ and 

‘‘Stop Order.’’ In addition, the Exchange 

believes that because DNI instructions 

would be added to an order, DNI is 

more appropriately referred to as a 

modifier rather than as an order type. 

• Pegging Interest. Existing rule text 

governing Pegging Interest and related 

subsections would be moved to new 

Rule 13(f)(3) with no changes to the 

existing rule text. The Exchange 

proposes to add rule text to new Rule 

13(f)(3)(A)(iv)(a) to clarify the definition 

of ‘‘next best-priced available interest’’ 

in that Rule. Specifically, the Exchange 

has recently adopted non-displayed 

order types that are priced based on the 

PBBO, including MPL Orders, discussed 

above, and Retail Price Improvement 

Orders (‘‘RPI’’), defined in Rule 

107C(a)(4)—Equities.17 Because Pegging 

Interest would not peg to either MPL 

Orders or RPIs, the Exchange proposes 

to clarify that for purposes of new Rule 

13(f)(3)(A)(iv)(a), the term next available 

best-priced interest refers to the highest- 

(lowest-) priced buy (sell) interest 

within the specified price range of 

pegging interest to buy (sell), including 

displayable bids (offers), Non-Display 

Reserve Orders, Non-Display Reserve eQuotes, odd-lot sized interest, and 

protected bids (offers) on away markets, 

but does not include non-displayed 

interest that is priced based on the 

PBBO. The Exchange notes that this 

would be applicable regardless of 

whether an MPL Order or RPI is 

marketable.18

• Retail Modifiers. Existing rule text 

governing Retail Modifiers and related 

subsections would be moved to new 

Rule 13(f)(4) with non-substantive 

changes to update cross-references. 

• Self-Trade Prevention (‘‘STP’’) 

Modifier. Existing rule text governing 

STP Modifiers and related subsections 

would be moved to new Rule 13(f)(5) 

with non-substantive changes to 

capitalize the terms ‘‘Limit Orders,’’ 

‘‘Market Orders,’’ and ‘‘Stop Orders’’ 

and hyphenate the term ‘‘Self-Trade 

Prevention.’’ 

• Sell ‘‘Plus’’—Buy ‘‘Minus’’ 

Instructions. Existing rule text 

governing Sell ‘‘Plus’’—Buy ‘‘Minus’’ 

Orders would be moved to new Rule 

13(f)(6) with non-substantive changes to 

break the rule into subsections, 

capitalize the terms ‘‘Market Order,’’ 

‘‘Limit Order,’’ and ‘‘Stop Order,’’ and 

replace the references to Display Book 

with references to Exchange systems. In 

addition, the Exchange proposes to reclassify this as an order instruction 

rather than as a separate order. 

• Stop Orders. Existing rule text 

governing Stop Orders would be moved 

to new Rule 13(f)(7) with nonsubstantive changes to break the rule 

into subsections, capitalize the term 

‘‘Market Order,’’ and replace references 

to ‘‘Exchange’s automated order routing 

system’’ with references to ‘‘Exchange 

systems.’’ 

The Exchange proposes to make 

conforming changes to Rule 501(d)(2)— 

Equities relating to the list of order 

types that are not accepted for trading 

in UTP Securities by: (i) Replacing the 

term ‘‘Market or Limit at the Close’’ 

with ‘‘MOC or LOC’’; (ii) replacing the 

term ‘‘At the Opening or At the Opening 

Only (‘‘OPG’’)’’ with ‘‘MOO or LOO’’; 

(iii) deleting the GTX Order reference, 

as an order instruction that the 

Exchange no longer accepts; and (iv) 

updating the subsection rule numbering 

accordingly. 

As part of the proposed restructure of 

Rule 13, the Exchange proposes to move 

existing rule text in Rule 13 governing 

the definition of ‘‘Routing Broker’’ to 

Rule 17(c), without any change to the 

rule text. The Exchange believes that 

Rule 17—Equities is a more logical 

location for the definition of Routing 

Broker because Rule 17(c)—Equities 

governs the operations of Routing 

Brokers. 

In addition, the Exchange proposes to 

delete existing rule text in Rule 13 

governing Not Held Orders and add rule 

text relating to not held instructions to 

supplementary material .20 to Rule 13. 

Supplementary material .20 to Rule 13 

reflects obligations that members have 

in handling customer orders. Because 

not held instructions are instructions 

from a customer to a member or member 

organization regarding the handling of 

an order, and do not relate to 

instructions accepted by Exchange 

systems for execution, the Exchange 

believes that references to not held 

instructions are better suited for this 

existing supplementary material. 

Accordingly, the Exchange proposes 

to amend supplementary material .20 to 

Rule 13 to add that generally, an 

instruction that an order is ‘‘not held’’ 

refers to an unpriced, discretionary 

order voluntarily categorized as such by 

the customer and with respect to which 

the customer has granted the member or 

member organization price and time 

discretion. The Exchange believes that 

this proposed amendment aligns the 

definition of ‘‘not held’’ with guidance 

from the Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) and other 

markets regarding not held 

instructions.19 The Exchange notes that 

the existing Rule 13 text regarding how 

to mark a Not Held Order, e.g., ‘‘not 

held,’’ ‘‘disregard tape,’’ ‘‘take time,’’ 

etc., are outdated references regarding 

order marking between a customer and 

a member or member organization. All 

Exchange members and member 

organizations that receive customer 

orders are subject to Order Audit Trail 

System (‘‘OATS’’) obligations, 

consistent with Rule 7400—Equities 

Series and FINRA Rule 7400 Series, 

which require that order-handling 

instructions be documented in OATS. 

Among the order-handling instructions 

that can be captured in OATS is 

whether an order is not held.20 The 

Exchange believes that these OATSrelated obligations now govern how a 

member or member organization records 

order-handling instructions from a 

customer and therefore the terms 

currently set forth in Rule 13 relating to 

Not Held Orders are no longer 

necessary. 

Finally, the Exchange proposes to 

amend Rule 70.25—Equities governing 

d-Quotes to clarify that certain 

functionality set forth in the Rule is no 

longer available. Specifically, Rule 

70.25(c)(ii)—Equities currently provides 


rmajette on DSK2VPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 224 / Thursday, November 20, 2014 / Notices 69157 

21 15 U.S.C. 78f(b). 

22 15 U.S.C. 78f(b)(5). 23See supra nn. 12–17. 

that a Floor broker may designate a 

maximum size of contra-side volume 

with which it is willing to trade using 

discretionary pricing instructions. 

Because this functionality is not 

available, the Exchange proposes to 

delete references to the maximum 

discretionary size parameter from Rules 

70.25(c)(ii)—Equities and (c)(v)— 

Equities. In addition, the Exchange 

proposes to amend Rule 70.25(c)(iv)— 

Equities to clarify that the 

circumstances of when the Exchange 

would consider interest displayed by 

other market centers at the price at 

which a d-Quote may trade are not 

limited to determining when a dQuote’s minimum or maximum size 

range is met. Accordingly, the Exchange 

proposes to delete the clause ‘‘when 

determining if the d-Quote’s minimum 

and/or maximum size range is met.’’ 

The Exchange believes that the 

proposed changes to Rule 70.25(c)— 

Equities will provide clarity and 

transparency regarding the existing 

functionality relating to d-Quotes at the 

Exchange. 

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),21 in general, and furthers the 

objectives of Section 6(b)(5),22 in 

particular, because it is 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 facilitating 

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. Specifically, the 

Exchange believes that the proposed 

restructuring of Rule 13, to group 

existing order types to align by 

functionality, would remove 

impediments to and perfect the 

mechanism of a free and open market by 

ensuring that members, regulators, and 

the public can more easily navigate the 

Exchange’s rulebook and better 

understand the order types available for 

trading on the Exchange. In addition, 

the Exchange believes that the proposed 

revisions to Rule 13 and related 

conforming changes to Rule 501(d)(2)— 

Equities promote clarity regarding 

existing functionality that has been 

approved in prior rule filings, but which 

may not have been codified in rule 

text.23 Moreover, the Exchange believes 

that moving rule text defining a Routing 

Broker to Rule 17—Equities represents a 

more logical location for such 

definition, thereby making it easier for 

market participants to navigate 

Exchange rules. Likewise, the Exchange 

believes the proposed changes to ‘‘Not 

Held Order,’’ to move it to 

supplementary material .20 to Rule 13 

and revise the rule text to conform with 

guidance from FINRA and OATS 

requirements, would remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system by 

applying a uniform definition of not 

held instructions across multiple 

markets, thereby reducing the potential 

for confusion regarding the meaning of 

not held instructions. 

The Exchange further believes that the 

proposed amendment regarding MPL 

Orders to reject both MPL Orders with 

an MTV larger than the size of the order 

and instructions to partially cancel an 

MPL Order that would result in an MTV 

larger than the size of the order would 

remove impediments to and perfect the 

mechanism of a free and open market 

and national market system in general 

because it could potentially reduce the 

ability of a member organization from 

using MPL Orders to bypass contra-side 

interest that may be larger than the size 

of the MPL Order. 

Finally, the Exchange believes that 

the proposed changes to Rule 70.25(c)— 

Equities would remove impediments to 

and perfect the mechanism of a free and 

open market and national market system 

in general because it assures that the 

Exchange’s rules align with the existing 

functionality available at the Exchange 

for d-Quotes. 

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 change is not designed to 

address any competitive issue but rather 

would re-structure Rule 13 and remove 

rule text that relates to functionality that 

is no longer operative, thereby reducing 

confusion and making the Exchange’s 

rules easier to navigate. 

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 

Within 45 days of the date of 

publication of this notice in the Federal 

Register or within such longer period 

up to 90 days of such date (i) as the 

Commission may designate if it finds 

such longer period to be appropriate 

and publishes its reasons for so finding 

or (ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

(A) by order approve or disapprove 

the proposed rule change, or 

(B) institute proceedings to determine 

whether the proposed rule change 

should be 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–2014–95 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–2014–95. 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 


rmajette on DSK2VPTVN1PROD with NOTICES
69158 Federal Register / Vol. 79, No. 224 / Thursday, November 20, 2014 / Notices 

24 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)(4)(ii). 

5 15 U.S.C. 78q–1. 

6 15 U.S.C. 78q–1(b)(3)(F). 

7 15 U.S.C. 78q–1(b)(3)(F). 

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 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– 

NYSEMKT–2014–95 and should be 

submitted on or before December 11, 

2014. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.24

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–27441 Filed 11–19–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73608; File No. SR–ICEEU– 

2014–19] 

Self-Regulatory Organizations; ICE 

Clear Europe Limited; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change to Finance 

Procedures 

November 14, 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 November 

6, 2014, ICE Clear Europe Limited (‘‘ICE 

Clear Europe’’ or ‘‘the Clearing House’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change described in Items 

I, II and III below, which Items have 

been primarily prepared by ICE Clear 

Europe. ICE Clear Europe filed the 

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

of the Act,3 and Rule 19b–4(f)(4)(ii) 

thereunder,4 so that the proposal was 

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 principal purpose of the 

proposed changes is to facilitate the use 

by F&O Clearing Members of an 

additional triparty collateral service 

provider. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, ICE 

Clear Europe 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. ICE 

Clear Europe has prepared summaries, 

set forth in sections A, B, and C below, 

of the most significant aspects of these 

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 amendments is to 

modify the Finance Procedures to 

appoint Clearstream Banking as an 

additional triparty collateral service 

provider in addition to Euroclear Bank, 

which currently acts as the sole service 

provider. Clearstream Banking will only 

serve as a triparty collateral service 

provider for Original Margin provided 

in respect of F&O Contracts. 

Specifically, changes are made 

throughout paragraph 3 of the Finance 

Procedures to add a reference to 

Clearstream Banking and to remove 

references to Euroclear Bank as the sole 

triparty collateral service provider, as 

appropriate. Paragraph 3.1 has been 

revised to designate Clearstream 

Banking as an additional triparty 

collateral service provider, solely with 

respect to Original Margin provided in 

respect of F&O Contracts. Paragraph 3.2 

has been revised to reflect that there are 

two triparty collateral service providers, 

and to refer to equivalent 

documentation that may be required by 

Clearstream Banking as well as 

Euroclear Bank. Paragraph 3.9 has been 

revised to indicate that the Clearing 

House will provide to Clearing Members 

the relevant account details for the 

Clearing House’s account at each 

triparty collateral service provider. 

Revised paragraph 3.9 also provides that 

the Clearing House will specify relevant 

details of the manner in which a 

Clearing Member may use a pledged 

collateral arrangement in connection 

with a triparty collateral account. 

Current paragraph 3.10, which 

addressed pledged collateral 

arrangements only with Euroclear, has 

been removed as unnecessary. 

Remaining subparagraphs in paragraph 

3 have been renumbered accordingly. 

2. Statutory Basis 

ICE Clear Europe believes that the 

proposed changes are consistent with 

the requirements of Section 17A of the 

Act 5 and the regulations thereunder 

applicable to it. Section 17A(b)(3)(F) of 

the Act 6 requires, among other things, 

that the rules of a clearing agency be 

designed to promote the prompt and 

accurate clearance and settlement of 

securities transactions and, to the extent 

applicable, derivative agreements, 

contracts, and transactions and 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. 

The proposed amendments are 

intended to extend the Clearing House’s 

existing triparty collateral service to 

allow optional use by Clearing Members 

of Clearstream Banking as an additional 

triparty collateral service provider with 

respect to Original Margin for F&O 

Contracts. The amendments do not 

otherwise change the substantive terms 

of the service. ICE Clear Europe views 

Clearstream Banking as substantially 

similar to Euroclear, the current service 

provider, from an operational and risk 

perspective and otherwise in terms of 

the safeguarding of funds and securities. 

As a result, ICE Clear Europe believes 

that the proposed changes will not 

adversely affect the safeguarding of 

securities or funds in the custody or 

control of ICE Clear Europe or for which 

it is responsible, and are therefore 

consistent with the requirements of 

Section 17A(b)(3)(F).7

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

ICE Clear Europe does not believe the 

proposed amendments would have any 

impact, or impose any burden, on 

competition not necessary or 

appropriate in furtherance of the 

purposes of the Act. The proposed 

changes will provide additional 

flexibility to F&O Clearing Members by 

permitting the use, on a voluntary basis, 

of an alternative triparty collateral 

service provider. The changes will 

otherwise not affect the terms or 

conditions of any cleared contract or the 


rmajette on DSK2VPTVN1PROD with NOTICES