Federal Register / Vol. 82, No. 160 / Monday, August 21, 2017 / Notices 39639 

18 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The term ‘‘inactive nominee’’ shall mean a 

natural person associated with and designated as 

such by a member organization and who has been 

approved for such status and is registered as such 

with the Membership Department. An inactive 

nominee shall have no rights or privileges under a 

permit unless and until said inactive nominee 

becomes admitted as a member of the Exchange 

pursuant to the By-Laws and Rules of the Exchange. 

An inactive nominee merely stands ready to 

exercise rights under a permit upon notice by the 

member organization to the Membership 

Department on an expedited basis. See Rule 1(l). 

4The Exchange currently charges an Inactive 

Nominee Fee of $600 for a six month period, which 

will be assessed to the member organization at a 

rate of $100 per month for the applicable six month 

period unless the member organization provides 

proper notice of its intent to terminate an inactive 

nominee prior to the first day of the next billing 

month. An inactive nominee’s status expires after 

six months unless it has been reaffirmed in writing 

by the member organization or is sooner terminated. 

A member organization will be assessed the 

Inactive Nominee Fee every time the status is 

reaffirmed. See the Exchange’s Pricing Schedule at: 

http://nasdaqphlx.cchwallstreet.com/

NASDAQPHLXTools/

PlatformViewer.asp?selectednode=chp_1_4_

10&manual=%2Fnasda

qomxphlx%2Fphlx%2Fphlx-rulesbrd%2F. 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

ISE–2017–79 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–ISE–2017–79. 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–ISE– 

2017–79 and should be submitted on or 

before September 11, 2017. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.18

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2017–17550 Filed 8–18–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–81401; File No. SR–Phlx– 

2017–68] 

Self-Regulatory Organizations; 

NASDAQ PHLX LLC; Notice of Filing 

and Immediate Effectiveness of 

Proposed Rule Change To Amend Rule 

925 To Create a Limited Exception to 

the Exchange’s Procedures To 

Designate an Inactive Nominee as an 

Effective Permit Holder Intra-Day and 

Make a Non-Substantive Change to the 

Pricing Schedule 

August 15, 2017. 

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 August 7, 

2017 NASDAQ PHLX LLC (‘‘Phlx’’ or 

‘‘Exchange’’) 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 (i) amend 

Rule 925 to create a limited exception 

to the Exchange’s existing procedures to 

designate an Inactive Nominee as an 

effective permit holder and (ii) make a 

non-substantive change to its Pricing 

Schedule related to the fees assessed to 

Inactive Nominees. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://nasdaqphlx.cchwallstreet. 

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 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 proposed rule 

change is to (i) amend Rule 925 to create 

a limited exception to the Exchange’s 

existing procedures to designate an 

Inactive Nominee 3 as an effective 

permit holder and (ii) make a nonsubstantive change to its Pricing 

Schedule related to the fees assessed to 

Inactive Nominees. 

Rule 925 

Today, the Exchange allows members 

on the Exchange’s trading floor to 

designate an ‘‘Inactive Nominee’’ 

pursuant to Rule 925. Rule 925(i) 

requires, among other criteria, that an 

individual must be approved as eligible 

to hold a permit in accordance with the 

Exchange’s By-Laws and Rules in order 

to be eligible for Inactive Nominee 

status. Additionally, the member 

organization with whom an Inactive 

Nominee is affiliated must pay an 

Inactive Nominee Fee for the privilege 

of maintaining the Inactive Nominee 

status.4 Furthermore, the Rule stipulates 

that an Inactive Nominee does not have 

any rights or privileges of a permit 

holder unless and until the Inactive 

Nominee becomes an effective permit 

holder and all applicable Exchange fees 

are paid. 

When a member organization desires 

to designate an Inactive Nominee as an 

effective permit holder, Rule 925(ii)(a) 

states that the member organization is 

required to notify the Exchange’s 


asabaliauskas on DSKBBXCHB2PROD with NOTICES
39640 Federal Register / Vol. 82, No. 160 / Monday, August 21, 2017 / Notices 

5 Inactive Nominees are essentially a pool of 

eligible individuals who can substitute for traders 

on the Exchange trading floor. The Inactive 

Nominee allows a member to have flexibility in 

obtaining coverage on the trading floor. An Inactive 

Nominee stands ready to assume a membership 

upon notice by the member requesting that a 

specific permit be transferred intra-firm on an 

expedited and temporary basis. This transfer allows 

an Inactive Nominee to become an effective member 

of the Exchange. For example, an Inactive Nominee 

might serve on behalf of a trader who needs to take 

leave for surgery, or could serve when a trader takes 

vacation leave. This allows a member organization 

to have full staff available to conduct business on 

the Exchange trading floor. 

6Such circumstances include sudden illness, 

family emergencies or other unavoidable factors. 

7See Securities Exchange Act Release No. 39851 

(April 10, 1998), 63 FR 19282 (April 17, 1998) (SR– 

PHLX–97–35) (order approving rule changes to 

establish the Inactive Nominee). 

8This fee is in addition to the Inactive Nominee 

Fee. See note 4 above. 

9See Securities Exchange Release No. 66004 

(December 19, 2011), 76 FR 80442 (December 23, 

2011) (SR–Phlx–2011–155). 

10Today, an Inactive Nominee is assessed a Clerk 

Fee of $100 per month. See Section VI.A of the 

Pricing Schedule at: http://nasdaqphlx.cchwall

street.com/NASDAQPHLXTools/

PlatformViewer.asp?selectednode=chp_1_4_

10&manual=%2Fnasda

qomxphlx%2Fphlx%2Fphlx-rulesbrd%2F. 

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

12 15 U.S.C. 78f(b)(5). 

Membership Department, in writing, 

prior to the opening of trading on any 

business day the name of such Inactive 

Nominee. Further, the notice must 

identify the name of the permit holder 

that the Inactive Nominee will be acting 

on behalf of as well as the expected 

duration that such Inactive Nominee 

will remain activated.5

The Exchange now proposes to create 

a limited exception to the Exchange’s 

existing procedures to designate an 

Inactive Nominee as an effective permit 

holder. In particular, the Exchange 

proposes to adopt a new provision at 

Rule 925(ii)(b) to permit member 

organizations to designate an Inactive 

Nominee intra-day in the event of an 

unforeseen emergency,6 provided that 

such intra-day designations must be 

approved by the Exchange’s Chief 

Regulatory Officer (‘‘CRO’’) or his/her 

designee prior to such Inactive Nominee 

becoming an effective permit holder. 

Other than to reduce the time period 

and to require prior approval of the CRO 

or his/her designee in the manner 

described above, the Exchange is not 

proposing any other changes to its 

existing procedures to designate an 

Inactive Nominee as an effective permit 

holder. Therefore, if a member 

organization seeks to obtain coverage on 

the trading floor intra-day due to 

unforeseen circumstances such as 

sudden illness, the proposed rule would 

still require the member organization to 

notify the Membership Department, in 

writing, of its desire to designate an 

Inactive Nominee as an effective permit 

holder intra-day. The notice must 

contain all of the information required 

under paragraph (ii)(a) (i.e., the name of 

such Inactive Nominee, the name of the 

permit holder that the Inactive Nominee 

will be acting on behalf of, and the 

expected duration that such Inactive 

Nominee will remain activated). Finally, 

the CRO or his/her designee must 

approve the member organization’s 

intra-day designation in order for the 

Inactive Nominee to become an effective 

permit holder. 

The Exchange believes that the 

proposed rule change is reasonable and 

would serve to enhance the application 

of Rule 925 by allowing members to 

quickly obtain coverage on the trading 

floor in limited cases where an 

unforeseen emergency arises intra-day, 

therefore making it impossible for a 

member to notify the Membership 

Department within the required time 

period under the current Rule. While 

these extraordinary circumstances rarely 

arise, the proposed rule change would 

give the CRO (or his/her designee in the 

CRO’s absence) the flexibility to 

approve the intra-day designation so 

that members are not adversely affected 

by unforeseen factors that prevented 

them from notifying the Exchange 

within the allotted time period. Because 

each individual on the floor is required 

to have a permit in order to trade, such 

emergencies could especially affect 

members who have small propriety 

businesses on the Exchange trading 

floor and therefore rely on these Inactive 

Nominees as their only substitutes. 

Similarly, since the time the Exchange 

adopted rules establishing the Inactive 

Nominee,7 the number of permit holders 

associated with a member organization 

on the Exchange trading floor has 

decreased. For the foregoing reasons, the 

Exchange seeks to address these 

extraordinary circumstances and allow 

its members to obtain coverage in such 

cases so that they may continue to 

conduct their businesses efficiently. The 

Exchange further believes that requiring 

the CRO’s approval of the intra-day 

designation would serve as a check to 

ensure that such designations would be 

made on a limited case-by-case basis. 

Pricing Schedule 

The Exchange is also proposing a nonsubstantive amendment to its Pricing 

Schedule at Section VI.A relating to the 

fees assessed to Inactive Nominees. In 

particular, Section VI.A of the 

Exchange’s Pricing Schedule states that 

an Inactive Nominee is also assessed the 

Trading Floor Personnel Registration 

Fee.8 As part of a previous filing, the 

Exchange renamed this fee as a ‘‘Clerk 

Fee’’ but inadvertently retained the 

reference to ‘‘Trading Floor Personnel 

Registration Fee’’ in Section VI.A.9 The 

Exchange now proposes to replace the 

term ‘‘Trading Floor Personnel 

Registration Fee’’ with ‘‘Clerk Fee’’ in 

this section. The Exchange will 

continue to assess Inactive Nominees 

the Clerk Fee as it is being assessed 

today.10

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,11 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,12

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. 

As discussed above, the Exchange 

believes that the proposed changes will 

allow members additional flexibility in 

obtaining coverage on the trading floor. 

Inactive Nominees are essentially a pool 

of eligible individuals who can 

substitute for traders on the Exchange’s 

floor. By allowing members flexibility in 

obtaining coverage intra-day in limited 

circumstances as described above, the 

Exchange believes that the proposal 

would assist in facilitating the smooth 

functioning of its market operations, 

consistent with Section 6(b)(5) of the 

Act. The Exchange further believes that 

the proposed changes would allow 

members to have a prepared roster of 

substitute traders who are available 

even in unforeseen emergencies, which 

should help to facilitate transactions in 

securities and remove impediments to, 

and perfect the mechanism of, a free and 

open market, also consistent with 

Section 6(b)(5) of the Act. 

Finally, the Exchange believes it is 

appropriate to make the non-substantive 

change in its Pricing Schedule to 

replace the obsolete reference to 

‘‘Trading Floor Personnel Registration 

Fee’’ with ‘‘Clerk Fee’’ so that members 

and investors have a clear and accurate 

understanding of the Exchange’s rules. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

Because the purpose of the proposal 

is to provide members with additional 

flexibility to obtain coverage intra-day 

in limited circumstances and to make a 

non-substantive change as discussed 


asabaliauskas on DSKBBXCHB2PROD with NOTICES
Federal Register / Vol. 82, No. 160 / Monday, August 21, 2017 / Notices 39641 

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

14 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 15 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)(6)(iii). 

above, the Exchange does not believe 

that the proposed rule change will 

impose any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing 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 for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A)(iii) of the Act 13 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.14

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: (i) Necessary or appropriate in 

the public interest; (ii) for the protection 

of investors; or (iii) otherwise in 

furtherance of the purposes of the Act. 

If the Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

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– 

Phlx–2017–68 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–Phlx–2017–68. 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– 

2017–68 and should be submitted on or 

before September 11, 2017. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2017–17548 Filed 8–18–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–81404; File No. SR– 

BatsBZX–2017–52] 

Self-Regulatory Organizations; Bats 

BZX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change to Rule 21.2, 

Days and Hours of Business 

August 15, 2017. 

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 August 2, 

2017, Bats BZX Exchange, Inc. (the 

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

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Exchange has 

designated this proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(6)(iii) 

thereunder,4 which renders it 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 Exchange filed a proposal to 

amend Rule 21.2, Days and Hours of 

Business. 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at www.bats.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. 


asabaliauskas on DSKBBXCHB2PROD with NOTICES