77550 Federal Register / Vol. 79, No. 247 / Wednesday, December 24, 2014 / Notices 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Exchange Act Release No. 73640 (Nov. 19, 

2014), 79 FR 70237 (Nov. 25, 2014) (SR– 

NYSEMKT–2014–93) (‘‘Supervision Filing’’). 

4The Exchange’s NYSE affiliate has also 

submitted a proposed rule change to amend NYSE 

Rule 342 to delete the requirements incorporated 

from the related NYSE Interpretation that every 

branch office or sales manager must have at least 

three years’ experience as a registered 

representative or substantial experience in a related 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

BYX–2014–040 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–BYX–2014–040. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE., 

Washington, DC 20549, on official 

business days between the hours of 

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

filing 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–BYX– 

2014–040 and should be submitted on 

or before January 14, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–30124 Filed 12–23–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73882; File No. SR– 

NYSEMKT–2014–101] 

Self-Regulatory Organizations; NYSE 

MKT LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change Amending Rule 342— 

Equities To Remove the Three Years’ 

Experience Requirement for 

Supervisory Personnel and To Add 

Supplementary Material to Rule 3110— 

Equities Stating That Supervisors Must 

Reasonably Discharge Their 

Supervisory Duties and Obligations 

December 18, 2014. 

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

Securities Exchange Act of 1934 (‘‘Act’’ 

or ‘‘Exchange Act’’) 1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on December 8, 2014, NYSE MKT LLC 

(‘‘NYSE MKT’’ 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 substantially prepared by the 

Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. The Exchange 

has designated the proposed rule change 

as constituting a ‘‘non-controversial’’ 

rule change under Exchange Act Rule 

19b–4(f)(6), which renders the proposal 

effective upon receipt of this filing by 

the Commission. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

NYSE MKT Rule 342—Equities (‘‘Rule 

342’’) to remove the three years’ 

experience requirement for supervisory 

personnel and to add supplementary 

material to NYSE MKT Rule 3110— 

Equities (‘‘Rule 3110’’) stating that 

supervisors must reasonably discharge 

their supervisory duties and obligations. 

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 

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 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 

Rule 342 to remove the three years’ 

experience requirement for supervisory 

personnel. The Exchange also proposes 

to add supplementary material to Rule 

3110 to further clarify that supervisors 

must reasonably discharge their 

supervisory duties and obligations. 

Rule 342 (Compliance Supervisors) 

As part of the Exchange’s efforts to 

harmonize its rules concerning 

supervision with those of the Financial 

Industry Regulatory Authority 

(‘‘FINRA’’), the Exchange recently 

amended Rule 342 by deleting elements 

of the rule relating to general 

supervision and focusing the rule on 

requirements regarding qualifications 

and exam requirements for individuals 

with supervisory responsibilities.3 As 

part of those amendments, the Exchange 

incorporated the following requirements 

for supervisory personnel into Rule 

342(a) contained in the Interpretation to 

New York Stock Exchange (‘‘NYSE’’) 

Rule 342: 

• Every branch office or sales 

manager must have at least three years’ 

experience as a registered representative 

or substantial experience in a related 

sales or managerial position (the new 

rule provided examples of roles that 

would qualify as a related sales or 

managerial position); and 

• In order to qualify as a supervisory 

person, a principal executive should 

have at least three years’ experience as 

a registered representative unless 

granted an exception. 

The Exchange proposes to delete 

these requirements from Rule 342(a) as 

inconsistent with prior amendments to 

NYSE Rule 342 on which the 

Exchange’s rule is based.4 Specifically, 

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Federal Register / Vol. 79, No. 247 / Wednesday, December 24, 2014 / Notices 77551 

sales or managerial position and must pass the 

Series 9/10. See SR–NYSE–2014–66. 

5See Exchange Act Release No. 58549 (Sept. 15, 

2008), 73 FR 54444 (Sept. 19, 2008) (SR–NYSE– 

2008–80). 

6See Supervision Filing, supra, n. 4. 

7FINRA Rule 0140 provides that FINRA’s rules 

apply to all members and persons associated with 

a member, and that persons associated with a 

member have the same duties and obligations as a 

member under FINRA’s rules. Under FINRA Rule 

0140, supervisors associated with a member are 

subject to the requirements of FINRA Rule 3110. 

The Exchange does not have a rule comparable to 

FINRA Rule 0140. The proposed amendment 

further clarifies that Rule 3110 applies to individual 

supervisors and thus promotes harmonization of the 

rule with Exchange rules and FINRA rules of 

similar purpose. 

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

9 15 U.S.C. 78f(b)(5). 

10 15 U.S.C. 78f(b)(8). 

11 17 CFR 240.19b–4(f)(6). 

12 17 CFR 240.19b–4(f)(6)(iii). 

13 15 U.S.C. 78s(b)(3)(A). 

14 17 CFR 240.19b–4(f)(6). 

effective September 12, 2008, the NYSE 

amended its Rule 342 and its related 

Interpretation to eliminate the 

prescribed three-year record 

requirement for supervisory personnel 

and conform NYSE Rule 342.13(a) to the 

standard outlined in NASD Rule 

1014(a)(10)(D).5 In the Supervision 

Filing, the Exchange inadvertently reintroduced the standards from the 

formerly deleted NYSE Interpretation to 

its Rule 342. Because the reintroduction of the three-year 

experience requirement for supervisory 

personnel was inadvertent and 

inconsistent with the harmonization 

effectuated in 2008, the Exchange 

proposes to delete this text from Rule 

342(a). 

Rule 3110 (Supervision) 

In the Supervision Filing, the 

Exchange also adopted new Rule 3110, 

which is based on FINRA Rule 3110.6

New Rule 3110(a) covers supervisory 

systems and requires member 

organizations to establish and maintain 

a system to supervise the activities of 

each associated person that is 

reasonably designed to achieve 

compliance with applicable securities 

laws and regulations, and with 

applicable Exchange rules. Under Rule 

3110, final responsibility for proper 

supervision rests with the member 

organization. While the Exchange 

believes that under Rule 3110 both 

member organizations and individual 

supervisors at member organizations 

may be liable for failing to reasonably 

discharge their duties and obligations 

with supervision and control of those 

employees under their supervision, for 

the avoidance of doubt, the Exchange 

proposes to add Supplementary 

Material .16 to Rule 3110 providing that 

individuals in charge of a group of 

employees must reasonably discharge 

their duties and obligations with respect 

to supervision and control of those 

employees related to the business of 

their employer and compliance with 

securities laws and regulations and 

Exchange rules.7

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,8 in general, and 

furthers the objectives of Section 6(b)(5) 

of the Act,9 in particular, because it is 

designed to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in facilitating transactions in securities, 

and to remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system. Specifically, the Exchange 

believes that the proposed rule change 

supports the objectives of the Act by 

providing greater harmonization 

between Exchange rules and FINRA 

rules of similar purpose, resulting in 

less burdensome and more efficient 

regulatory compliance. In particular, the 

Exchange believes that removing the 

three-year experience requirement for 

supervisors, which was previously 

deleted from NYSE Rule 342 on which 

the Exchange’s rule is based and 

inadvertently re-introduced, would 

remove impediments to and perfect the 

mechanism of a free and open market by 

eliminating a regulatory disparity 

between the supervisory rules of the 

Exchange and FINRA, thereby also 

further harmonizing those rules. 

Further, the Exchange believes that 

adding the proposed supplementary 

material to Rule 3110 emphasizing that 

individual supervisors shall reasonably 

discharge their supervisory duties and 

obligations would remove impediments 

to and perfect the mechanism of a free 

and open market because it would 

reduce potential confusion and provide 

transparency regarding the duties and 

obligations of individual supervisors 

under the Exchange’s harmonized 

supervision rules. The Exchange also 

believes that the proposed rule change 

would update and add specificity to the 

requirements governing supervision, 

which would promote just and equitable 

principles of trade and help to protect 

investors. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

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

the Act,10 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 is not 

intended to address competitive issues 

but rather to achieve greater 

transparency and consistency between 

the Exchange’s rules and FINRA’s rules 

concerning supervision. 

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 

A proposed rule change filed under 

Exchange Act Rule 19b–4(f)(6) normally 

does not become operative prior to 30 

days after the date of the filing.11

However, pursuant to Rule 19b– 

4(f)(6)(iii), the Commission may 

designate a shorter time if such action 

is consistent with the protection of 

investors and the public interest.12 The 

Exchange believes that the proposal 

qualifies for immediate effectiveness 

upon filing because it is a ‘‘noncontroversial’’ rule change in 

accordance with Section 19(b)(3)(A) of 

the Act 13 and Rule 19b–4(f)(6) 

thereunder.14 Accordingly, the 

Exchange has asked that the 

Commission waive the 30-day operative 

delay so that the proposal becomes 

operative immediately upon filing. 

The Exchange believes that the 

proposal is non-controversial because it 

raises no novel issues and is consistent 

with rules previously approved by the 

Commission. The Exchange states that 

the purpose of the proposed rule change 

is to eliminate requirements in the 

Exchange’s rules previously deleted by 

the Exchange and to further conform the 

Exchange’s supervision rules to those of 

FINRA. The Exchange believes that 

updating and adding transparency to the 

requirements governing individual 

supervisors would help to protect 

investors and would not significantly 

burden competition. More specifically, 

the Exchange believes that: (1) Members 

of both FINRA and the Exchange (‘‘Dual 

Members’’) are already subject to the 

requirement that individual supervisors 

reasonably discharge their supervisory 

duties and obligations; and (2) the 

proposed clarification does not 

represent a new standard for Exchangeonly members, who were subject to the 

same standard under former Rule 342. 

Accordingly, the Exchange believes that 

these proposed rule changes are eligible 

mstockstill on DSK4VPTVN1PROD with NOTICES

77552 Federal Register / Vol. 79, No. 247 / Wednesday, December 24, 2014 / Notices 

15See Exchange Act Release No. 58092 (Jul. 3, 

2008), 73 FR 40144 (Jul. 11, 2008) (concerning 17 

CFR 200 and 241). 16For purposes of waiving the 30-day operative 

delay, the Commission has considered the proposed 

rule’s impact on efficiency, competition and capital 

formation. See 15 U.S.C. 78c(f). 

In addition, the Exchange has given the 

Commission written notice of its intent to file the 

proposed rule change, along with a brief description 

and text of the proposed rule change, at least five 

(5) business days prior to the date of the filing of 

the proposed rule change, or such shorter time as 

designated by the Commission. See 17 CFR 

240.19b–4(f)(6)(iii). 

17 15 U.S.C. 78s(b)(2)(B). 18 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

for immediately effective treatment 

under the Commission’s current 

procedures for processing rule filings.15

The Commission believes that 

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. More specifically, the 

Commission believes that waiving the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest because enhanced 

transparency to the supervision 

obligations of individual supervisors 

will help members improve compliance 

with applicable securities laws, 

including rules governing sale practices. 

In addition, granting the waiver would 

allow the Exchange to immediately 

eliminate requirements in the 

Exchange’s rules that were mistakenly 

reinserted after being previously 

deleted. For these reasons, the 

Commission designates the proposed 

rule change as operative upon filing.16

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend the 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) of the Act 17 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–2014–101 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–NYSEMKT–2014–101. 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 Section, 100 F Street NE., 

Washington, DC 20549–1090 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. 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–2014–101 and should be 

submitted on or before January 14, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.18

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–30125 Filed 12–23–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73875; File No. SR–BATS– 

2014–068] 

Self-Regulatory Organizations; BATS 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change to Rules 11.9(a)(2) and 

11.18(e) of BATS Exchange, Inc. 

December 18, 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 December 

10, 2014, BATS Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BATS’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The 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 

The Exchange filed a proposal to 

amend Rule 11.9(a)(2), which describes 

BATS market orders, and Rule 11.18(e), 

which describes the Exchange’s 

implementation of the Limit Up-Limit 

Down Plan, as defined below. 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at http://www.batstrading.com/, at the 

principal office of the Exchange, and at 

the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

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

the most significant parts of such 

statements. 

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