Federal Register / Vol. 82, No. 218 / Tuesday, November 14, 2017 / Notices 52749 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4For purposes of NYSE American Rule 980NY, 

an Electronic Complex Order is any Complex Order, 

as defined in NYSE American Rule 900.3NY(e) that 

is entered into the Exchange System. See NYSE 

American Rule 980NY. The Exchange System 

(‘‘System’’) is the Exchange’s electronic order 

delivery, execution and reporting system for 

designated option issues through which orders and 

quotes of Users are consolidated for execution and/ 

or display. Market Makers must submit quotes to 

the System in their appointed classes electronically. 

See NYSE American Rule 900.2NY(48). A Complex 

Order is any order involving the simultaneous 

purchase and/or sale of two or more different 

option series in the same underlying security, for 

the same account, in a ratio that is equal to or 

greater than one-to-three (.333) and less than or 

equal to three-to-one (3.00) and for the purpose of 

executing a particular investment strategy. See 

NYSE American Rule 900.3NY(e). 

5See Securities Exchange Act Release No. 81676 

(September 21, 2017), 82 FR 45085 (‘‘Notice’’). 

6Amendment No. 1 modifies the original filing to 

(1) add specificity to NYSE American Rule 

980NY(c)(ii) by indicating that both Customer and 

non-Customer leg market interest will have first 

priority to trade with an incoming ECO when the 

leg markets can execute against an incoming ECO 

in full (or in a permissible ratio), and each leg 

includes Customer interest; (2) clarify the provision 

in NYSE American Rule 980NY(e)(2) indicating that 

a Complex Order Auction (‘‘COA’’)-eligible order 

may trade immediately in full (or in a permissible 

ratio) with a resting ECO priced equal to the contraside Complex BBO, unless each leg of the contraside Complex BBO includes Customer interest; (3) 

add a provision to NYSE American Rule 

980NY(e)(7)(A) indicating that ECOs on behalf of 

Customers will have priority over same-priced 

ECOs for non-Customers when allocating orders at 

the conclusion of a COA; (4) clarify the requirement 

NYSE American Rule 980NY, Commentary .02 to 

provide price improvement on at least one leg of the 

ECO when each leg of the contra-side Complex BBO 

for the components of the ECO includes Customer 

interest; (5) remove a superfluous reference in 

Commentary .02 to Commentary .01; and (6) delete 

language in the description section indicating that 

the proposal removes references to Customer ECO 

priority. To promote transparency of its proposed 

amendment, when NYSE American filed 

Amendment No. 1 with the Commission, it also 

submitted Amendment No. 1 as a comment letter 

to the file, which the Commission posted on its 

Web site and placed in the public comment file for 

SR–NYSEAMER–2017–15 (available at https://

www.sec.gov/comments/sr-nyseamer-2017-15/ 

nyseamer201715-2656362-161384.pdf). The 

Exchange also posted a copy of its Amendment No. 

1 on its Web site (available at https://

www.nyse.com/publicdocs/nyse/markets/nyseamerican/rule-filings/filings/2017/NYSEAmer2017-15,%20Am.%201.pdf. 

7The title of NYSE American Rule 980NY(c)(ii) 

remains unchanged, except for the addition of the 

word ‘‘Electronic’’ prior to ‘‘Complex Orders.’’ 

NYSE American Rule 900.2NY(15) defines Core 

Trading Hours as ‘‘the regular trading hours for 

business set forth in the rules of the primary 

markets underlying those option classes listed on 

the Exchange; provided, however, that transactions 

may be effected on the Exchange until the regular 

time set for the normal close of trading in the 

primary markets with respect to equity option 

classes and ETF option classes, and 15 minutes 

after the regular time set for the normal close of 

trading in the primary markets with respect to 

index option classes, or such other hours as may be 

determined by the Exchange from time to time.’’ 

8See Notice, 82 FR at 45086. 

9See id. NYSE American Rule 980NY(c)(ii) states 

that ‘‘The CME will accept an incoming marketable 

Electronic Complex Order and automatically 

execute it against the best-priced contra-side 

interest resting in the Consolidated Book. If, at a 

price, the leg markets can execute against an 

incoming Electronic Complex Order in full (or in 

a permissible ratio), and each leg includes Customer 

interest, the leg markets (Customer and nonCustomer interest) will have first priority at that 

price and will trade with the incoming Electronic 

Complex Order pursuant to Rule 964NY(b) before 

Electronic Complex Orders resting in the 

Consolidated Book can trade at that price.’’ See 

Amendment No. 1. 

10See Amendment No. 1. See also Notice, 82 FR 

at 45087. The proposal amends NYSE American 

Rule 980NY(a) to add a defined term, ‘‘leg markets,’’ 

to refer to individual quotes and orders in the 

Consolidated Book. In addition, the proposal 

revises NYSE American Rule 980NY(c) to add the 

word ‘‘strategy’’ following the term ‘‘complex 

order,’’ and to add references to ‘‘Electronic’’ 

Complex Orders to the titles of NYSE American 

Continued 

Dated: November 8, 2017. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2017–24681 Filed 11–9–17; 11:15 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–82027; File No. SR– 

NYSEAMER–2017–15] 

Self-Regulatory Organizations; NYSE 

American LLC; Notice of Filing of 

Amendment No. 1 and Order Granting 

Accelerated Approval of a Proposed 

Rule Change, as Modified by 

Amendment No. 1, To Amend NYSE 

American Rule 980NY To Clarify the 

Priority of Electronic Complex Orders 

and To Modify Aspects of the Complex 

Order Auction Process 

November 7, 2017. 

I. Introduction 

On September 8, 2017, NYSE 

American LLC (the ‘‘Exchange’’ or 

‘‘NYSE American’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’), pursuant to 

Section 19(b)(1) 1 of the Securities 

Exchange Act of 1934 (the ‘‘Act’’),2 and 

Rule 19b–4 thereunder,3 a proposed rule 

change to amend NYSE American Rule 

980NY to clarify and provide greater 

specificity to its rules governing the 

trading of Electronic Complex Orders 

(‘‘ECOs’’), and to correct inaccuracies in 

those rules.4 The proposed rule change 

was published for comment in the 

Federal Register on September 27, 

2017.5 The Commission received no 

comment letters regarding the proposal. 

On October 26, 2017, NYSE American 

filed Amendment No. 1 to the proposal, 

which supersedes the original filing in 

its entirety.6 The Commission is 

publishing this notice to solicit 

comment on Amendment No. 1 to the 

proposed rule change from interested 

persons and is approving the proposed 

rule change, as modified by Amendment 

No. 1, on an accelerated basis. 

II. Description of the Proposed Rule 

Change 

NYSE American Rule 980NY governs 

the trading of ECOs in the Exchange’s 

Complex Matching Engine (‘‘CME’’). As 

described more fully in the Notice, 

NYSE American proposes to amend 

NYSE American Rule 980NY to provide 

additional specificity, transparency, and 

clarity to its processing of ECOs. The 

proposal also corrects inaccuracies in 

NYSE American Rule 980NY. 

Execution of ECOs During Core Trading 

Hours 

The proposal amends NYSE American 

Rule 980NY(c), ‘‘Execution of Complex 

Orders,’’ to indicate that ECOs may be 

executed not only without consideration 

of prices of the same complex order that 

might be available on other exchanges, 

as the rule currently provides, but also 

without consideration of the prices of 

single-legged orders that might be 

available on other exchanges. In 

addition, the proposal revises and 

reorganizes current NYSE American 

Rule 980NY(c) by replacing current text 

and adding new paragraphs (ii), 

‘‘Execution of Electronic Complex 

Orders During Core Trading,’’ and (iii), 

‘‘Electronic Complex Orders in the 

Consolidated Book.’’ 7 The changes to 

NYSE American Rules 980NY(c)(ii) and 

(iii) are designed to describe the 

processing of ECOs during Core Trading 

in a more concise and logical manner, 

with NYSE American Rule 980NY(c)(ii) 

governing the execution of ECOs that 

are marketable on arrival and NYSE 

American Rule 980NY(c)(iii) governing 

how ECOs would be ranked in the 

Consolidated Book and executed as 

resting interest on the Consolidated 

Book.8 New NYSE American Rule 

980NY(c)(ii) indicates that the CME 

would accept an incoming marketable 

ECO and automatically execute it 

against the best-priced contra-side 

interest resting in the Consolidated 

Book.9 If, at a price, the leg markets can 

trade against an incoming ECO in full 

(or in a permissible ratio), and each leg 

includes Customer interest, the leg 

markets—including both Customer and 

non-Customer interest—would have 

first priority at that price to trade with 

the incoming ECO pursuant to NYSE 

American Rule 964NY(b), followed by 

resting ECOs in price/time priority.10


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Rules 980NY(c)(i) and (ii). See id., 82 FR at 45086, 

n. 7. 

11See Notice, 82 FR at 45087. 

12See id. 

13See id. NYSE American notes that it is not 

proposing to modify the functionality of the COA. 

See id. 

14See id. Current NYSE American Rule 980NY(e) 

states that ‘‘Upon entry into the System, eligible 

Electronic Complex Orders may be subject to an 

automated request for responses (‘RFR’) auction.’’ 

15Core Trading Hours are ‘‘the regular trading 

hours for business set forth in the rules of the 

primary markets underlying those option classes 

listed on the Exchange; provided, however, that 

transactions may be effected on the Exchange until 

the regular time set for the normal close of trading 

in the primary markets with respect to equity 

option classes and ETF option classes, and 15 

minutes after the regular time set for the normal 

close of trading in the primary markets with respect 

to index option classes, or such other hours as may 

be determined by the Exchange from time to time.’’ 

See NYSE American Rule 900.2NY(15). 

16See Notice, 82 FR at 45087. Current NYSE 

American Rule 980NY(e)(1) defines COA-eligible 

order as ‘‘an Electronic Complex Order that, as 

determined by the Exchange on a class-by-class 

basis, is eligible for a COA considering the order’s 

marketability (defined as a number of ticks away 

from the current market), size, number of series, 

and complex order origin types (i.e., Customers, 

broker-dealers that are not Market-Makers or 

specialists on an options exchange, and/or MarketMakers or specialists on an options exchange).’’ 

NYSE American currently allows COA-eligible 

orders to be entered in every class. See Notice, 82 

FR at 45087, n. 24. 

17See id. 

18The Complex BBO is ‘‘the BBO for a given 

complex order strategy as derived from the best bid 

on OX and the best offer on OX for each individual 

component series of a Complex Order.’’ See NYSE 

American Rule 900.2NY(7)(b). 

19See new NYSE American Rule 980NY(e)(2) and 

Amendment No. 1. 

20See new NYSE American Rule 980NY(e)(2). 

21See new NYSE American Rule 980NY(e)(3). 

22See Notice, 82 FR 45088. 

23See id. 

24See new NYSE American Rule 980NY(e)(3). 

25See id. 

26The Exchange believes that this provision can 

be inferred from current NYSE American Rule 

980NY(e)(8), which describes the impact of COAeligible orders that arrive during a COA. See Notice, 

82 FR at 45088, n. 29. The Commission notes that 

current NYSE American Rule 980NY(e)(8)(D) states 

that incoming COA-eligible orders received during 

the Response Time Interval that are one same side 

of the market and priced better than the initiating 

order will cause the auction to end. 

27See Notice, 82 FR at 45088. 

New NYSE American Rule 

980NY(c)(iii), which incorporates 

existing paragraphs (c)(ii)(B) and (C) and 

renumbers them as (iii)(A) and (B), 

addresses incoming ECOs that are not 

marketable. New NYSE American Rule 

980NY(c)(iii)(A) makes clear that an 

ECO, or portion thereof, that is not 

executed on arrival will be ranked in the 

Consolidated Book and that any 

incoming orders and quotes that can 

trade with a resting ECO would execute 

according to NYSE American Rule 

980NY(c)(ii).11 New NYSE American 

Rule 980NY(c)(iii)(B) clarifies that 

orders that trade against ECOs in the 

Consolidated Book will be allocated 

pursuant to NYSE American Rule 

964NY(b), rather than pursuant to NYSE 

American Rule 964NY.12

Electronic Complex Order Auction 

Rules 

Because of the number of 

modifications to current NYSE 

American Rule 980NY(e), ‘‘Electronic 

Complex Order Auction (‘‘COA’’) 

Process,’’ the proposal deletes the 

existing rule in its entirety and replaces 

it with new NYSE American Rule 

980NY(e), which is designed to describe 

the COA process more clearly, 

accurately, and logically.13 New NYSE 

American Rule 980NY(e) indicates that, 

upon entry into the System, an ECO 

may be executed immediately in full, or 

in a permissible ratio, as provided in 

NYSE American Rule 980NY(e)(2), or 

may be subject to a COA.14 New NYSE 

American Rule 980NY(e)(1) defines a 

‘‘COA-eligible order’’ to mean an ECO 

that is entered in a class designated by 

the Exchange and is (i) designated by 

the ATP Holder as COA-eligible; and (ii) 

received during Core Trading Hours.15

New NYSE American Rule 980NY(e)(1) 

preserves existing provisions in current 

NYSE American Rule 980NY(e)(1) and 

(2) that allow the Exchange to determine 

COA eligibility on a class-by-class basis 

and require an ATP Holder to provide 

direction that an auction be initiated.16

The proposal eliminates from the new 

definition of COA-eligible order several 

features of ECOs that are included in the 

current definition of COA-eligible order, 

but that, according to the Exchange, are 

not determinative of COA eligibility on 

NYSE American, including the ‘‘size, 

number of series, and complex order 

origin types (i.e., Customers, brokerdealers that are not Market-Makers or 

specialists on an options exchange, and/ 

or Market-Makers or specialists on an 

options exchange).’’ 17

New NYSE American Rule 

980NY(e)(2) provides that, upon entry 

into the System, a COA-eligible order 

will trade immediately, in full or in a 

permissible ratio, with any ECOs resting 

in the Consolidated Book that are priced 

better than the contra-side Complex 

BBO.18 A COA-eligible order may trade 

with any ECOs resting in the 

Consolidated Book priced equal to the 

contra-side Complex BBO, unless each 

leg of the contra-side Complex BBO 

includes Customer interest.19 Any 

portion of a COA-eligible order that 

does not trade immediately upon entry 

into the System may start a COA.20 A 

COA-eligible order that does not trade 

immediately upon entry into the System 

will start a COA, provided that the limit 

price of the COA-eligible order to buy 

(sell) is: (i) Higher (lower) than the bestpriced, same side interest in both the leg 

markets and any ECOs resting in the 

Consolidated Book; and (ii) within a 

given number of ticks away from the 

current, contra-side market, as 

determined by the Exchange.21 NYSE 

American notes that, because a COAeligible order may be a certain number 

of ticks away from the current contraside market, it is possible that a COA 

could be initiated even if the limit price 

of the COA-eligible order is not at or 

within the NYSE American best bid/ 

offer for each leg of the order.22 NYSE 

American notes, however, that a COAeligible order must execute at a price 

that is at or within the NYSE American 

best bid/offer for each leg of the order, 

consistent with NYSE American Rule 

980NY(c).23 A COA-eligible order will 

reside on the Consolidated Book until it 

meets the requirements of NYSE 

American Rule 980NY(e)(3)(i) and (ii) 

and can initiate a COA.24

New NYSE American Rule 

980NY(e)(3) provides that NYSE 

American will initiate a COA by 

sending a request for response (‘‘RFR’’) 

message to all ATP Holders that 

subscribe to RFR messages. RFR 

messages will identify the component 

series, the size and side of the market of 

the order and any contingencies.25

These provisions are consistent with 

current NYSE American Rule 

980NY(e)(2). New NYSE American Rule 

980NY(e)(3) further provides that only 

one COA may be conducted at a time for 

any given complex order strategy.26

Finally, new NYSE American Rule 

980NY(e)(3) states that, at the time the 

COA is initiated, NYSE American will 

record the Complex BBO (the ‘‘initial 

Complex BBO’’) for purposes of 

determining whether the COA should 

end early pursuant to new NYSE 

American Rule 980NY(e)(6). As 

discussed more fully below, NYSE 

American believes that the use of the 

initial Complex BBO ensures that the 

COA respects the leg markets and the 

principles of price-time priority.27

New NYSE American Rule 

980NY(e)(4) defines the ‘‘Response 

Time Interval’’ (‘‘RTI’’) as the period of 

time during which RFR Responses may 

be entered. The rule further provides 

that NYSE American will determine the 

length of the RTI, provided, however, 

that the duration will not be less than 

500 milliseconds and will not exceed 

one second. These provisions are 

consistent with current NYSE American 

Rule 980NY(e)(3). Finally, new NYSE 

American Rule 980NY(e)(4) indicates 


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28See new NYSE American Rule 980NY(e)(5). 

ATP Holders also may submit RFR Responses on 

behalf of Customers. See Notice, 82 FR at 45088, n. 

31. 

29See new NYSE American Rules 980NY(e)(5)(A) 

and (C). 

30See id. 

31See new NYSE American Rule 980NY(e)(5)(B). 

32See new NYSE American Rule 980NY(e)(5)(C). 

33See Notice, 82 FR at 45089. NYSE American 

notes that all orders may be cancelled. See id. 

34See Notice, 82 FR at 45089 and new NYSE 

American Rule 980NY(e)(3). See also note 28, 

supra, and accompanying text. 

35See new NYSE American Rule 

980NY(e)(6)(A)(i). 

36See Notice, 82 FR at 45090. 

37See id. 

38See new NYSE American Rule 

980NY(e)(6)(A)(iv). NYSE American notes that this 

provision is consistent with current NYSE 

American 980NY(e)(8)(A), but provides additional 

detail regarding the ability for any balance of the 

incoming opposite-side ECO to trade with the bestpriced resting contra-side interest before, or instead 

of, being ranked in the Consolidated Book. See 

Notice, 82 FR at 45089–90. 

39See new NYSE American Rule 

980NY(e)(6)(A)(v). 

40Current NYSE American Rule 980NY(e)(8)(D) 

also provides that an incoming same-side, betterpriced COA-eligible order will cause the COA to 

end. 

41See Notice, 82 FR at 45091. 

that, at the end of the RTI, the COAeligible order will be allocated pursuant 

to new NYSE American Rule 

980NY(e)(7). 

New NYSE American Rule 

980NY(e)(5), which describes the 

characteristics of RFR Responses, 

retains some provisions of current NYSE 

American Rules 980NY(e)(4) and (e)(7) 

and modifies other aspects of those 

rules. Specifically, new NYSE American 

Rule 980NY(e)(5) retains the following 

provisions in current NYSE American 

Rules 980NY(e)(4) and (7): Any ATP 

Holder may submit RFR Responses 

during the RTI; 28 RFR Responses are 

ECOs with a time-in-force contingency 

for the duration of the COA and will 

expire at the end of the COA; 29 RFR 

Responses may be submitted in $0.01 

increments and may be modified during 

the RTI; 30 RFR Responses must be on 

the opposite side of the COA-eligible 

order, while RFR Responses on the same 

side as the COA-eligible order will be 

rejected; 31 and RFR Responses will not 

be ranked or displayed in the 

Consolidated Book.32 New NYSE 

American Rule 980NY(e)(5)(A) adds 

new detail by indicating that an RFR 

Response must specify the price, size, 

and side of the market. Current NYSE 

American Rule 980NY(e)(7) states that 

RFR Response may not be withdrawn 

prior to the end of the RTI. New NYSE 

American Rule 980NY(e)(5)(C), 

however, indicates that RFR Responses 

may be cancelled during the RTI, which 

NYSE American states is consistent 

with its current functionality.33

Impact of Incoming Trading Interest on 

the COA Process 

New NYSE American Rules 

980NY(e)(6)(A) and (B) replace existing 

NYSE American Rule 980NY(e)(8), and 

new NYSE American Rule 

980NY(e)(6)(C) replaces existing NYSE 

American Rule 980NY(e)(9). As noted 

above, the new rules introduce and 

incorporate the concept of the initial 

Complex BBO—the BBO for a given 

complex order strategy derived from the 

best bid (‘‘BB’’) and best offer (‘‘BO’’) for 

each individual component series of a 

complex order as recorded at the start of 

the RTI—as a benchmark against which 

incoming interest is measured to 

determine whether a COA should end 

early.34 New NYSE American Rules 

980NY(e)(6)(A) and (B) address the 

impact on the COA of incoming ECOs 

and COA-eligible orders. New NYSE 

American Rule 980NY(e)(6)(C) 

addresses the impact of leg market 

updates on the COA. New NYSE 

American Rule 980NY(e)(6)(B) provides 

that when a COA ends early, or at the 

end of the RTI, the initiating COAeligible order will execute pursuant to 

new NYSE American Rule 980NY(e)(7) 

ahead of any interest that arrived during 

the COA. 

New NYSE American Rule 

980NY(e)(6)(A)(i) provides that 

incoming opposite-side ECOs or COAeligible orders that lock or cross the 

initial Complex BBO will cause the 

COA to end early. If the incoming ECO 

or COA-eligible order is also executable 

against the limit price of the initiating 

COA-eligible order, it will be ranked 

with RFR Responses to execute with the 

COA-eligible order pursuant to new 

NYSE American Rule 980NY(e)(7).35

NYSE American believes that ending 

the COA early under these 

circumstances would allow an initiating 

COA-eligible order to execute (ahead of 

the incoming order) against any RFR 

Responses or ECOs received during the 

RTI until that point, while preserving 

the priority of the incoming order to 

trade with the resting leg markets.36

NYSE American also states that early 

conclusion of the COA would avoid 

disturbing priority in the Consolidated 

Book and allow the Exchange to 

appropriately handle the incoming 

orders.37

New NYSE American Rule 

980NY(e)(A)(ii) provides that incoming 

opposite-side ECOs or COA-eligible 

orders that are executable against the 

limit price of the COA-eligible order, 

but do not lock or cross the initial 

Complex BBO, will not cause the COA 

to end early and will be ranked with 

RFR Responses to execute with the 

COA-eligible order pursuant to NYSE 

American Rule 980NY(e)(7). NYSE 

American Rule 980NY(e)(6)(A)(iii) 

provides that incoming opposite-side 

ECOs or COA-eligible orders that are 

either not executable on arrival against 

the limit price of the initiating COAeligible order or do not lock or cross the 

initial Complex BBO will not cause the 

COA to end early. 

New NYSE American Rules 

980NY(e)(6)(A)(iv) and (v) describe the 

treatment of incoming opposite-side 

ECOs and COA-eligible orders that do 

not execute with the initiating COAeligible order or were not executable on 

arrival. An incoming opposite-side ECO 

that did not execute against the 

initiating COA-eligible order or was not 

executable on arrival will trade 

pursuant to NYSE American Rule 

980NY(c)(ii) or (iii).38 An incoming 

opposite-side COA-eligible order(s) that 

did not execute against the initiating 

COA-eligible order or was not 

executable on arrival will initiate 

subsequent COA(s) in price-time 

priority.39

New NYSE American Rule 

980NY(e)(6)(B)(i) indicates that an 

incoming ECO or COA-eligible order on 

the same side of the market as the 

initiating COA-eligible order that is 

priced higher (lower) than the initiating 

COA-eligible order to buy (sell) will 

cause the COA to end early.40 In 

addition, new NYSE American Rule 

980NY(e)(6)(B)(ii) states that an 

incoming same-side ECO or COAeligible order that is priced equal to or 

lower (higher) than the initiating COAeligible order to buy (sell), and that also 

locks or crosses the contra-side initial 

Complex BBO, will cause the COA to 

end early. NYSE American believes that 

ending the COA early under the 

circumstances would ensure that the 

COA interacts seamlessly with the 

Consolidated Book, and would allow 

the COA-eligible order to execute (ahead 

of the incoming order) against any RFR 

Responses or ECOs received during the 

RTI until that point, while preserving 

the priority of the incoming order to 

trade with the resting leg markets.41

New NYSE American Rule 

980NY(e)(6)(B)(ii) also helps to correct 

an inaccuracy in current NYSE 

American Rules 980NY(e)(8)(B) and (C), 

which indicate that incoming same-side 

COA-eligible orders received during the 

RTI that are priced equal to or worse 

than the initiating COA-eligible order 

will join the COA. Instead, an incoming 


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42See new NYSE American Rules 

980NY(e)(6)(B)(iv) and (vi). See also Notice, 82 FR 

at 45091, n. 48 and accompanying text. New NYSE 

American Rule 980NY(e)(6)(B)(iv) provides that an 

incoming ECO or COA-eligible order that caused a 

COA to end early, if executable, will trade against 

any RFR Responses and/or ECOs received during 

the RTI that did not trade with the initiating COAeligible order. New NYSE American Rule 

980NY(e)(6)(B)(vi) provides that the remaining 

balance of any incoming COA-eligible order(s) that 

does not trade against any remaining RFR 

Responses or ECOs will initiate new COA(s) in 

price-time priority. 

43See new NYSE American Rules 

980NY(e)(6)(B)(iv) and (v). NYSE American Rule 

980NY(e)(6)(B)(v) provides that any incoming sameside ECO, or the remaining balance of such an ECO, 

that did not trade against any remaining RFR 

Responses or ECOs will trade pursuant to new 

NYSE American Rule 980NY(c)(ii) or (iii). 

44Current NYSE American Rule 980NY(e)(9)(A) 

similarly provides that leg market interest that 

causes the derived Complex Best Bid/Offer to be 

better than the COA-eligible order and to cross the 

best-priced RFR Response will cause the auction to 

end. 

45See Notice, 82 FR at 45091. 

46See new NYSE American Rule 

980NY(e)(6)(C)(ii). 

47See new NYSE American Rule 

980NY(e)(6)(C)(iii). 

48See new NYSE American Rule 

980NY(e)(6)(C)(iv). 

49See Notice, 82 FR at 45091. 

50See Notice, 82 FR at 45091–45092. 

51See Notice, 82 FR at 45092. 

52See Notice, 82 FR at 45092 and Amendment 

No. 1. 

53See Amendment No. 1. 

54See new NYSE American Rule 980NY(e)(7)(B). 

55See Notice, 82 FR at 45092. 

56See id. 

57See new NYSE American Rule 980NY(e)(7). 

58See Amendment No. 1. 

59See Notice, 82 FR at 45093. 

60 In approving this proposed rule change, the 

Commission notes that it has considered the 

proposed rule’s impact on efficiency, competition, 

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

61 15 U.S.C. 78(b)(5). 

62See Securities Exchange Act Release No. 80138 

(March 1, 2017), 82 FR 12869 (March 7, 2017) 

(order approving File No. SR–NYSEArca–2016– 

149). 

same-side equal-priced or worse-priced 

COA-eligible order that locks or crosses 

the contra-side initial Complex BBO 

would not execute during the COA in 

progress, as the current rules suggest, 

but could trade with RFR Responses or 

ECOs that do not execute in the COA 

and, if any balance remains, would 

initiate a new COA.42 An incoming 

same-side equal-priced or worse-priced 

ECO that locks or crosses the contra-side 

initial Complex BBO could trade with 

RFR Responses or ECOs that do not 

execute in the COA and, if any balance 

remains, would trade pursuant to NYSE 

American Rule 980NY(c)(ii) or (iii).43

New NYSE American Rule 

980NY(e)(6)(B)(iii) states that an 

incoming same-side ECO or COAeligible order that is priced equal to, or 

lower (higher) than the initiating COAeligible order to buy (sell), but does not 

lock or cross the contra-side initial 

Complex BBO, will not cause the COA 

to end early. 

New NYSE American Rule 

980NY(e)(6)(C)(i) provides that updates 

to the leg markets that cause the sameside Complex BBO to lock or cross any 

RFR Response(s) and/or ECOs received 

during the RTI, or ECOs resting in the 

Consolidated Book, will cause the COA 

to end early.44 The Exchange believes 

that providing for a COA to terminate 

early under these circumstances would 

allow a COA-eligible order to trade 

against any RFR Responses or ECOs 

received during the RTI up until that 

point, while preserving the priority of 

the updated leg markets to trade with 

any eligible contra-side interest, 

including any ECOs resting in the 

Consolidated Book.45 Updates to the leg 

markets that cause the same-side 

Complex BBO to be priced higher 

(lower) than the COA-eligible order to 

buy (sell), but do not lock or cross any 

RFR Response(s) and/or Electronic 

Complex Order(s) received during the 

RTI, or ECOs resting in the Consolidated 

Book, will not cause the COA to end 

early.46 Updates to the leg markets that 

cause the contra-side Complex BBO to 

lock or cross the same-side initial 

Complex BBO will cause the COA to 

end early.47 Updates to the leg markets 

that cause the contra-side Complex BB 

(BO) to improve (i.e., become higher 

(lower)), but do not lock or cross the 

same-side initial Complex BBO, will not 

cause the COA to end early.48 NYSE 

American believes that new NYSE 

American Rules 980NY(e)(6)(C)(i)–(iv) 

respect the COA process while 

maintaining the priority of orders and 

quotes on the Consolidated Book as they 

update.49 NYSE American notes that 

new NYSE American Rule 

980NY(e)(6)(C) is based in part on 

current NYSE American Rules 

980NY(e)(9)(A) and (B).50 NYSE 

American states that the new rule 

provides additional clarity and 

transparency by indicating on which 

side the leg markets have updated.51

New NYSE American Rule 

980NY(e)(7), which describes the 

allocation of COA-eligible orders at the 

conclusion of a COA, will replace 

current NYSE American Rule 

980NY(e)(6) in its entirety.52 New NYSE 

American Rule 980NY(e)(7)(A) provides 

that RFR Responses and ECOs to buy 

(sell) that are priced higher (lower) than 

the initial Complex BBO will be eligible 

to trade first with the COA-eligible 

order, beginning with the highest 

(lowest) at each price point, on a Size 

Pro Rata basis, as defined in NYSE 

American Rule 964(b)(3), provided that 

ECOs on behalf of Customers will have 

priority over same-priced ECOs for nonCustomers.53 After COA allocations 

pursuant to NYSE American Rule 

980NY(e)(7)(A), the COA-eligible order 

will trade with best-priced contra-side 

interest pursuant to NYSE American 

Rule 980NY(c)(ii) or (iii).54 Thus, after 

the COA-eligible order trades with 

price-improving interest received during 

the RTI, any remainder of the COAeligible order will follow NYSE 

American’s regular allocation rules for 

an incoming marketable ECO.55 NYSE 

American believes that this provision 

makes clear that a COA-eligible order 

would trade against the leg markets only 

after any auction allocations have been 

made.56 Any unexecuted portion of the 

COA-eligible order will be ranked in the 

Consolidated Book.57

NYSE American also proposes to 

modify Commentary .02 to NYSE 

American Rule 980NY to make clear 

that the price improvement requirement 

provided in Commentary .02 applies if 

each leg of the contra-side Complex 

BBO for the components of the ECO 

includes Customer interest.58 NYSE 

American believes that these changes 

add clarity and internal consistency to 

its rules.59

III. Discussion and Commission 

Findings 

After careful review of the proposed 

rule change, as modified by Amendment 

No. 1, the Commission finds that the 

proposed rule change, as amended, is 

consistent with the requirements of the 

Act and the rules and regulations 

thereunder applicable to a national 

securities exchange.60 In particular, the 

Commission finds that the proposed 

rule change, as modified by Amendment 

No. 1, is consistent with Section 6(b)(5) 

of the Act,61 which requires, among 

other things, that the rules of a national 

securities exchange be designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade, to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest. The Commission notes 

that the proposed rules are substantially 

similar to rules recently adopted by 

NYSE Arca, Inc., except that NYSE 

American’s rules reflect its Customer 

priority allocation model.62

Execution of Complex Orders During 

Core Trading Hours 

NYSE American Rule 980NY(c) 

currently provides that ECOs submitted 


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63See, e.g., NYSE Arca Rule 6.91–O(a)(2) 

(substantively identical to new NYSE American 

Rule 980NY(c)); ISE Rule 722(b)(3) (stating that 

complex orders may be executed without 

consideration of the prices that might be available 

on other options exchanges trading the same 

contracts); and Phlx Rules 1098(e)(i)(B) and (f)(iii) 

(providing that COLA-eligible orders and complex 

orders in the CBOOK will be executed without 

consideration of any prices that might be available 

on other exchanges trading the same contracts). 

64See Options Order Protection and Locked/ 

Crossed Markets Plan, Section V(b)(viii) (available 

at http://www.optionsclearing.com/components/ 

docs/clearing/services/options_order_protection_

plan.pdf). The proposal also revises NYSE 

American Rule 980NY(a) to add the defined term 

‘‘leg markets’’ to refer to individual quotes and 

orders in the Consolidated Book. The Commission 

believes that adding this defined term could help 

to enhance the clarity and readability of NYSE 

American Rule 980NY. 

65See Amendment No. 1. 

66Current NYSE American Rule 980NY(c)(ii)(A) 

states that ‘‘The CME will accept an incoming 

marketable Electronic Complex Order and will 

automatically execute it against Electronic Complex 

Orders in the Consolidated Book, or, if not 

marketable against another Electronic Complex 

Order, against individual orders or quotes residing 

in the Consolidated Book, provided the Electronic 

Complex Order can be executed in full (or in a 

permissible ratio) by the individual orders or quotes 

in the Consolidated Book. Notwithstanding the 

foregoing, if individual Customer orders residing in 

the Consolidated Book can execute the incoming 

Electronic Complex Order in full (or in a 

permissible ratio) at the same total or net debit or 

credit as an Electronic Complex Order in the 

Consolidated Book, the individual Customer orders 

will have priority. The allocation of orders or 

quotes residing in the Consolidated Book that 

execute against an Electronic Complex Order shall 

be done pursuant to Rule 964NY.’’ NYSE American 

notes that, under its current rule, the leg markets 

have first priority to trade against an incoming ECO 

if (i) there are no better priced ECOs in the 

Consolidated Book, (ii) the leg markets can trade in 

full or permissible ratio against an ECO, and (iii) 

each leg contains Customer interest. See Notice, 82 

FR at 45086. 

67See new NYSE American Rule 

980NY(c)(iii)(A). Current NYSE American Rule 

980NY(c)(ii)(B) provides that ‘‘An Electronic 

Complex Order that is not marketable will rest in 

the Consolidated Book. If an Electronic Complex 

Order is being held in the Consolidated Book, the 

CME will monitor the bids and offers in the leg 

markets, and if a new order(s) or quote(s) entered 

into the Consolidated Book can execute the 

Electronic Complex Order in full (or in a 

permissible ratio), the Electronic Complex Order 

will be executed against such new order(s) or 

quote(s).’’ 

68See note14, supra, and accompanying text. 

69See note 15, supra, for the current definition of 

COA-eligible order. 

70See new NYSE American Rule 980NY(e)(1)(i). 

Current NYSE American Rule 980NY(e)(2) 

provides, in part, that NYSE American will initiate 

an auction for a COA-eligible order upon direction 

from the entering ATP Holder that an auction be 

initiated. 

71See Notice, 82 FR at 45088. 

to NYSE American may be executed 

without consideration of prices of the 

same complex order that might be 

available on other exchanges. The 

proposal revises NYSE American Rule 

980NY(c) to state that ECOs submitted 

to the Exchange may be executed 

without consideration not only of the 

prices of the same complex order 

strategy that might be available on other 

exchanges, but also of the prices of other 

single-legged orders that might be 

available on other exchanges. The 

Commission believes that expanding 

NYSE American Rule 980NY(c) to 

include single-legged orders on other 

exchanges is consistent with the rules of 

other options exchanges.63 In addition, 

the Commission notes that this change 

is consistent with the Options Order 

Protection and Locked/Crossed Markets 

Plan, which excepts transactions 

effected as part of a ‘‘complex trade’’ 

from the requirement that exchanges 

establish, maintain, and enforce written 

policies and procedures reasonably 

designed to prevent trade-throughs.64

The Commission believes that the 

proposal to add new NYSE American 

Rules 980NY(c)(ii) and (iii), and the 

accompanying changes to delete certain 

existing rule text, will benefit market 

participants by more clearly describing, 

respectively, the treatment of incoming 

marketable ECOs (which are executed 

immediately) and incoming nonmarketable ECOs (which are routed to 

the Consolidated Book) during Core 

Trading Hours. In particular, new NYSE 

American Rule 980NY(c)(ii) specifies 

that an incoming marketable ECO would 

trade against the best-priced contra-side 

interest resting in the Consolidated 

Book. New NYSE American Rule 

980NY(c)(ii) further provides that if, at 

a price, the leg markets can execute 

against an incoming ECO in full (or in 

a permissible ratio), and each leg 

includes Customer interest, the leg 

markets (Customer and non-Customer 

interest) will have first priority at that 

price and will trade with the incoming 

ECO pursuant to NYSE American Rule 

964NY(b) before ECOs resting in the 

Consolidated Book can trade at that 

price.65 The Commission believes that 

new NYSE American Rule 980NY(c)(ii) 

is consistent with current NYSE 

American Rule 980NY(c)(ii)(A).66 The 

Commission believes that new NYSE 

American Rule 980NY(c)(iii) adds 

clarifying detail to NYSE American’s 

rules by indicating that an ECO or 

portion of an ECO that is not executed 

on arrival will be ranked in the 

Consolidated Book and by providing 

that resting ECOs will be executed 

against new interest entered into the 

Consolidated Book according to NYSE 

American Rule 980NY(c)(ii), thereby 

providing market participants with 

more precise information concerning 

NYSE American’s handling of these 

orders.67 In addition, new NYSE 

American Rule 980NY(c)(iii)(B) 

provides additional specificity by 

indicating that complex trades are 

allocated among ATP Holders pursuant 

to NYSE American Rule 964NY(b), 

rather than pursuant to NYSE American 

Rule 964NY, as provided in current 

NYSE American Rule 980NY(c)(ii)(C). 

Changes Related to the COA Process 

The Commission believes that the 

introductory language in new NYSE 

American Rule 980NY(e) is similar to 

the text of current NYSE American Rule 

980NY(e), but provides additional 

clarity by indicating that an incoming 

ECO could execute immediately against 

interest resting in the Consolidated 

Book pursuant to NYSE American Rule 

980NY(c)(ii), or be subject to a COA.68

The Commission believes that the 

definition of COA-eligible order in new 

NYSE American Rule 980NY(e)(1) will 

make clear that an ECO will be COAeligible only if it is submitted during 

Core Trading Hours.69 The definition of 

COA-eligible order retains the 

requirement that the ATP Holder 

designate the order as COA-eligible.70

The Commission believes that 

eliminating the provision in current 

NYSE American Rule 980NY(e)(1) that 

allows NYSE American to restrict COA 

eligibility based on an order’s size, 

number of series, or order origin type 

could benefit investors by helping to 

make more orders eligible for a COA 

and, therefore, able to receive potential 

price improvement during a COA. 

New NYSE American Rule 

980NY(e)(2) provides that, upon entry 

into the System, a COA-eligible order 

will trade immediately, in full or in a 

permissible ratio, with any ECOs resting 

in the Consolidated Book that are priced 

better than the contra-side Complex 

BBO. NYSE American believes that the 

immediate price improvement 

opportunity for an incoming COAeligible order from ECOs resting in the 

Consolidated Book obviates the need to 

start a COA.71 The Commission believes 

that, under these circumstances, 

executing a COA-eligible order against 

resting interest that is priced better than 

the contra-side Complex BBO will 

provide the COA-eligible order with an 

immediate execution at an improved 

price, and could benefit both the sender 

of the COA-eligible order and the sender 

of the resting better-priced ECO. NYSE 

American Rule 908NY(e)(2) further 

provides that a COA-eligible order may 

trade with any ECOs resting in the 

Consolidated Book that are priced equal 

to the contra-side Complex BBO, unless 

each leg of the contra-side Complex 


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72See Amendment No. 1. 

73See NYSE American Rule 980NY(e)(3). 

74See Notice, 82 FR at 45088. 

75See note 29, supra, and accompanying text. 

76See notes 30–36, supra, and accompanying 

text. 

77See new NYSE American Rule 980NY(e)(5)(A). 

78See NYSE Arca Rule 6.91–O(c)(5)(C) (stating 

that RFR Responses may be modified or cancelled 

during the RTI); and CBOE Rule 6.53C(d)(vii) 

(stating that RFR Responses represent non-firm 

interest that can be modified or withdrawn at any 

time prior to the end of the RTI). 

79 If the incoming opposite-side ECO or COAeligible order is also executable against the limit 

price of the initiating COA-eligible order, it will be 

ranked with RFR Responses to execute with the 

COA-eligible order. See new NYSE American Rule 

980NY(e)(6)(A)(i). 

80See Notice, 82 FR at 45090. If no RFRs are 

received during the RTI, the COA-eligible order will 

execute against the best-priced contra-side interest, 

including the order that caused the COA to 

terminate early. See id. 

81See id. 

BBO includes Customer interest.72 The 

Commission believes that this provision 

is consistent with new NYSE American 

Rule 980NY(c)(ii), which, as described 

above, gives contra-side leg market 

interest first priority to trade with an 

incoming ECO only if, at a price, the 

contra-side leg market interest includes 

Customer interest for each component 

leg of the ECO. 

The Commission believes that new 

NYSE American Rule 980NY(e)(3)(i) 

could enhance competition by 

encouraging market participants to 

submit aggressively priced COA-eligible 

orders because only COA-eligible orders 

priced better than the same-side leg 

market and ECO interest would be able 

to initiate a COA. The Commission 

believes that new NYSE American Rule 

980NY(e)(3)(ii) will provide NYSE 

American with flexibility to determine 

when the price of a COA-eligible order, 

based on the number of ticks away from 

the current contra-side market, warrants 

the initiation of a COA. The 

Commission believes that permitting 

only one COA at a time for any complex 

order strategy will help to provide for 

the orderly processing of trading interest 

on NYSE American.73 The Commission 

notes that although a COA could be 

initiated even if the limit price of the 

COA-eligible order is not at or within 

the NYSE American best bid/offer for 

each leg of the order, the COA-eligible 

order must execute at a price that is at 

or within the NYSE American best bid/ 

offer for each leg of the order, consistent 

with NYSE American Rule 980NY(c).74

As noted above,75 the definition of 

RTI in new NYSE American Rule 

980NY(e)(4) is based on current NYSE 

American Rule 980NY(e)(3), with the 

addition of new rule text providing that, 

at the end of an RTI, a COA-eligible 

order would be allocated pursuant to 

new NYSE American Rule 980NY(e)(7). 

The Commission believes that the new 

rule text will benefit market investors by 

clarifying how these two provisions 

interact with one another. 

As discussed more fully above, new 

NYSE American Rule 980NY(e)(5), 

which describes the characteristics of 

RFR Responses, retains features of the 

current provisions addressing RFR 

Responses,76 but adds new detail by 

indicating that an RFR Response must 

specify the price, size, and side of the 

market.77 The Commission believes that 

this change will make clear to market 

participants the information that they 

must include in an RFR Response. In 

addition, new NYSE American Rule 

980NY(e)(5)(C) indicates that RFR 

Responses may be cancelled during the 

RTI, replacing language in current NYSE 

American Rule 980NY(e)(7) that states 

that RFR Responses may not be 

withdrawn prior to the end of the RTI. 

The Commission believes that new 

NYSE American Rule 980NY(e)(5)(C) 

will correct an inaccuracy in NYSE 

American’s current rules and make clear 

to ATP Holders that they may cancel 

their RFR Responses during the RTI. 

The Commission notes that two other 

options exchanges also permit the 

withdrawal or cancellation of RFR 

Responses during the RTI.78

Impact of Incoming Trading Interest on 

the COA Process 

New NYSE American Rule 

980NY(e)(6)(A)(i) provides that 

incoming opposite-side ECOs or COAeligible orders that lock or cross the 

initial Complex BBO will cause the 

COA to end early.79 NYSE American 

believes that ending the COA early 

under these circumstances will allow an 

initiating COA-eligible order to execute, 

ahead of the incoming order, against 

RFR Responses or ECOs received during 

the RTI until that point, while 

preserving the priority of the incoming 

order to trade with the resting leg 

markets.80 NYSE American also believes 

that the early conclusion of the COA 

would avoid disturbing the priority in 

the Consolidated Book.81 The 

Commission believes that ending the 

COA early when an incoming contraside ECO or COA-eligible order locks or 

crosses the initial Complex BBO will 

allow NYSE American to maximize 

order executions and provide for the 

orderly processing of trading interest on 

NYSE American. The early termination 

of the COA will allow the COA-eligible 

order to execute against trading interest 

received during the RTI, including the 

order that caused the COA to end early, 

while preserving the ability of the 

resting leg market orders that comprise 

the initial Complex BBO to trade with 

the incoming interest that locked or 

crossed the initial Complex BBO. 

New NYSE American Rule 

980(e)(6)(A)(ii) provides that incoming 

opposite-side ECO or COA-eligible 

orders that are executable against the 

limit price of the COA-eligible order, 

but do not lock or cross the initial 

Complex BBO, will not cause the COA 

to end early and will be ranked with 

RFR Responses to execute with the 

COA-eligible order pursuant to NYSE 

American Rule 980NY(e)(7). The 

Commission believes that allowing the 

COA to continue under these 

circumstances could provide the 

potential for the COA-eligible order to 

receive price improvement as the 

auction continues. The Commission 

notes that, in this case, the incoming 

contra-side interest does not raise leg 

market priority concerns that would 

require an early termination of the COA 

because the incoming contra-side 

interest does not lock or cross the initial 

Complex BBO. 

NYSE American Rule 

980NY(e)(6)(A)(iii) provides that 

incoming opposite-side ECOs or COAeligible orders that are either not 

executable on arrival against the limit 

price of the initiating COA-eligible order 

or do not lock or cross the initial 

Complex BBO will not cause the COA 

to end early. The Commission believes 

that because the incoming contra-side 

interest does not lock or cross the initial 

Complex BBO, it is not necessary to end 

the COA early to protect the priority of 

interest in the leg market under these 

circumstances. 

New NYSE American Rules 

980NY(e)(6)(A)(iv) and (v) describe the 

treatment of incoming opposite-side 

ECOs and COA-eligible orders that did 

not execute with the initiating COAeligible order or were not executable on 

arrival. Such an incoming opposite-side 

ECO would trade pursuant to NYSE 

American Rule 980NY(c)(ii) or (iii), and 

an incoming opposite-side COA-eligible 

order would initiate a subsequent COA. 

The Commission believes that allowing 

these incoming ECOs and COA-eligible 

orders to trade with interest resting in 

the Consolidated Book, or to initiate a 

new COA, as applicable, will allow 

NYSE American to provide additional 

execution opportunities for these orders. 

In addition, the Commission believes 

that new NYSE American Rules 

980NY(e)(6)(A)(iv) and (v) will enhance 

the transparency of NYSE American’s 

rules by providing additional detail 

regarding the treatment of incoming 

opposite-side ECOs and COA-eligible 


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82See NYSE Arca Rule 6.91–O(c)(6)(B) 

(substantively identical to new NYSE American 

Rule 980NY(e)(6)(B)); and Phlx Rule 1098(e)(viii)(B) 

(stating, in part, with respect to the Phlx’s Complex 

Order Live Auction (‘‘COLA’’): ‘‘Incoming Complex 

Orders that were received during the COLA Timer 

for the same Complex Order Strategy as the COLAeligible order that are on the same side of the 

market will join the COLA. The original COLAeligible order has priority at all price points (i.e., 

multiple COLA Sweep Prices) over the incoming 

Complex Order(s), regardless of the price of the 

incoming Complex Order. The incoming Complex 

Order shall not be eligible for execution against 

interest on the opposite side of the market from the 

COLA-eligible order until the COLA-eligible order 

is executed to the fullest extent possible’’). 

83The Commission notes that current NYSE 

American Rule 980NY(e)(8)(D) also provides that an 

incoming same-side, better-priced COA-eligible 

order will cause the COA to end. 

84See Notice, 82 FR at 45091. 85See new NYSE American Rule 

980NY(e)(6)(B)(iv). 86See new NYSE American Rule 

980NY(e)(6)(B)(v). 

87See new NYSE American Rule 

980NY(e)(6)(B)(vi). 

88See NYSE American Rule 980NY(e)(6)(C)(i). 

89See NYSE American Rule 980NY(e)(6)(C)(iii). 

90See NYSE American Rule 980NY(e)(6)(C)(ii). 

91See NYSE American Rule 980NY(e)(6)(C)(iv). 

92See Notice, 82 FR at 45092. 

orders that did not trade with the 

initiating COA-eligible order or were not 

executable on arrival. 

New NYSE American Rule 

980NY(e)(6)(B) states that when a COA 

ends early, or at the end of the RTI, the 

initiating COA-eligible order will 

execute pursuant to new NYSE 

American Rule 980NY(e)(7) ahead of 

any interest that arrived during the 

COA. The Commission believes that this 

provision establishes the priority of the 

initiating COA-eligible order to trade 

before trading interest that arrives 

during the auction. The Commission 

notes that the rules of two other options 

exchanges similarly establish the 

priority of the auctioned order to trade 

prior to interest that arrives during the 

auction.82

New NYSE American Rule 

980NY(e)(6)(B)(i) indicates that an 

incoming ECO or COA-eligible order on 

the same side of the market as the 

initiating COA-eligible order that is 

priced higher (lower) than the initiating 

COA-eligible order to buy (sell) will 

cause the COA to end early.83 The 

Commission believes that ending the 

COA early under these circumstances 

provides a means to maximize 

execution opportunities by allowing the 

COA-eligible order to execute against 

interest received during the auction and 

allowing the incoming better-priced 

ECO or COA-eligible order to trade with 

interest resting in the Consolidated 

Book (in the case of an ECO), or to 

initiate a new auction (in the case of a 

COA-eligible order). 

New NYSE American Rule 

980NY(e)(6)(B)(ii) provides that an 

incoming same-side ECO or COAeligible order that is priced equal to or 

lower (higher) than the initiating COAeligible order to buy (sell), and that also 

locks or crosses the contra-side initial 

Complex BBO, will cause the COA to 

end early. NYSE American states that 

ending the COA early under these 

circumstances will allow the COAeligible order to execute, ahead of the 

incoming order, against RFR Responses 

or ECOs received during the RTI until 

the point, while preserving the priority 

of the incoming order to trade with the 

resting leg markets.84 The Commission 

believes that ending the COA early 

under these circumstances is designed 

to maximize execution opportunities 

and provide for the orderly processing 

of trading interest on NYSE American 

by allowing the COA-eligible order to 

execute against trading interest received 

during the RTI, while preserving the 

ability of the resting leg market orders 

that comprise the initial Complex BBO 

to trade with the incoming interest that 

locked or crossed the initial Complex 

BBO. 

New NYSE American Rules 

980NY(e)(6)(B)(iv), (v), and (vi) further 

describe the treatment of incoming 

same-side COA-eligible orders or ECOs 

received during the RTI. An incoming 

same-side ECO or COA-eligible order 

that caused a COA to end early, if 

executable, will trade against any RFR 

Responses and/or ECOs received during 

the RTI that did not trade with the 

initiating COA-eligible order.85 Any 

incoming same-side ECO, or the 

remaining balance of such an ECO, that 

did not trade against any remaining RFR 

Responses or ECOs will trade pursuant 

to new NYSE American Rule 

980NY(c)(ii) or (iii).86 The balance of 

any incoming COA-eligible order(s) that 

did not trade against any remaining RFR 

Responses or ECOs will initiate new 

COA(s) in price-time priority.87 The 

Commission believes that these 

provisions could benefit investors by 

potentially maximizing the execution 

opportunities for incoming same-side 

ECOs and COA-eligible orders, which 

may execute against remaining RFR 

Responses or ECOs, execute against 

interest resting in the Consolidated 

Book (in the case of an ECO), or initiate 

a new COA (in the case of a COAeligible order). 

New NYSE American Rule 

980NY(e)(6)(B)(iii) states that an 

incoming same-side ECO or COAeligible order that is priced equal to, or 

lower (higher) than the initiating COAeligible order to buy (sell), but does not 

lock or cross the contra-side initial 

Complex BBO, will not cause the COA 

to end early. The Commission believes 

that, under these circumstances, the 

incoming same-side interest does not 

raise leg market priority concerns that 

would require an early termination of 

the COA because the incoming interest 

does not lock or cross the contra-side 

initial Complex BBO. 

The Commission believes that new 

NYSE American Rule 980NY(e)(6)(C) 

will provide greater clarity and 

specificity regarding the impact of leg 

market updates on the COA. The 

Commission believes that providing for 

an early end to the COA when the leg 

market updates cause the same-side 

Complex BBO to lock or cross RFR 

Responses or ECOs received during the 

RTI, or ECOs resting in the Consolidated 

Book,88 or cause the contra-side 

Complex BBO to lock or cross the sameside initial Complex BBO,89 will allow 

the COA-eligible order to execute 

against interest received during the 

auction and permit the updated leg 

markets to execute against available 

trading interest, thereby maximizing 

execution opportunities for trading 

interest in the COA and in the leg 

markets, and providing for the orderly 

processing of trading interest on NYSE 

American. The Commission believes 

that allowing the COA to continue when 

leg market updates do not result in an 

execution opportunity—i.e., when leg 

market updates cause the same-side 

Complex BBO to be priced higher 

(lower) than the COA-eligible order to 

buy (sell), but do not lock or cross any 

RFR Responses or ECOs received during 

the RTI, or ECOs resting in the 

Consolidated Book,90 or when leg 

market updates cause the contra-side 

Complex BB (BO) to improve, but do not 

lock or cross the same-side initial 

Complex BBO 91—will allow for the 

submission of additional trading interest 

that might result in an execution or 

price improvement for the COA-eligible 

order. 

New NYSE American Rule 

980NY(e)(7), which describes the 

allocation of COA-eligible orders at the 

conclusion of a COA, will replace 

current NYSE American Rule 

980NY(e)(6) in its entirety.92 The 

Commission believes that new NYSE 

American Rule 980NY(e)(7)(A) protects 

leg market interest resting in the 

Consolidated Book at the beginning of 

the COA by providing that the COAeligible order will be eligible to trade 

first with RFR Responses and ECOs 

priced better than the initial Complex 

BBO. In addition, new NYSE American 

Rule 980NY(e)(7)(A) clarifies the 


ethrower on DSK3G9T082PROD with NOTICES
52756 Federal Register / Vol. 82, No. 218 / Tuesday, November 14, 2017 / Notices 

93See Amendment No. 1. 

94See id. 

95As described more fully above, new NYSE 

American Rule 980NY(c)(ii) provides the leg 

markets first priority to trade against an incoming 

marketable ECO only when the contra-side leg 

market interest for each component leg of the ECO 

includes Customer interest. New NYSE American 

Rule 980NY(e)(2) provides that a COA-eligible order 

may execute against ECOs resting in the 

Consolidated Book that are priced equal to the 

contra-side Complex BBO, unless each leg of the 

contra-side Complex BBO includes Customer 

interest. 96See footnote 6, supra. 

97 15 U.S.C. 78s(b)(2). 

98 17 CFR 200.30–3(a)(12). 

allocation priority of Customer orders 

by indicating that ECOs on behalf of 

Customers will have priority over samepriced ECOs for non-Customers.93 New 

NYSE American Rule 980NY(e)(7)(B) 

provides that, after allocations pursuant 

to NYSE American Rule 980NY(e)(7)(A), 

a COA-eligible order will trade with 

best-priced contra-side interest pursuant 

to NYSE American Rule 980NY(c)(ii) or 

(iii). NYSE American Rule 980NY(e)(7) 

states that any unexecuted portion of a 

COA-eligible order will be ranked in the 

Consolidated Book. The Commission 

believes that these provisions establish 

additional execution opportunities for a 

COA-eligible order, or portion of a COAeligible order, that does not execute 

during the COA, and provide clarity 

regarding the handling of these orders. 

The Commission believes that the 

proposed changes to Commentary .02 to 

NYSE American Rule 980NY clarify the 

circumstances under which an ECO that 

executes against another ECO must 

trade at a price that is better than leg 

market interest. Specifically, 

Commentary .02 indicates that the ECOs 

must trade at an improved price when 

each leg of the contra-side Complex 

BBO for the components of the ECO 

includes Customer interest.94 The 

Commission notes that Commentary .02 

is consistent with the Customer priority 

provisions of new NYSE American 

Rules 980NY(c)(ii) and (e)(2).95

IV. Solicitation of Comments on 

Amendment No. 1 

Interested persons are invited to 

submit written data, views, and 

arguments concerning whether 

Amendment No. 1 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– 

NYSEAMER–2017–15 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–NYSEAMER–2017–15. 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. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–NYSEAMER–2017–15, and 

should be submitted on or before 

December 5, 2017. 

V. Accelerated Approval of Proposed 

Rule Change, as Modified by 

Amendment No. 1 

The Commission finds good cause to 

approve the proposed rule change, as 

modified by Amendment No. 1, prior to 

the thirtieth day after the date of 

publication of the notice of Amendment 

No. 1 in the Federal Register. In 

Amendment No. 1, NYSE American 

revises its original proposal to make the 

changes discussed in detail above.96

Notably, in Amendment No. 1, NYSE 

American revises its proposal to provide 

additional clarity to the Customer 

priority provisions of the proposed 

rules. In this regard, Amendment No. 1 

makes clear that when allocating orders 

at the conclusion of a COA, ECOs on 

behalf of Customers have priority over 

same-priced ECOs for non-Customers. In 

addition, Amendment No. 1 indicates 

that a COA-eligible order may trade 

immediately in full (or in a permissible 

ratio) with a resting ECO priced equal to 

the contra-side Complex BBO, unless 

each leg of the contra-side Complex 

BBO includes Customer interest. 

Amendment No. 1 also clarifies the 

circumstances under which ECOs that 

execute against each other must trade at 

a price that is better than the 

corresponding leg market interest. The 

Commission believes that Amendment 

No. 1 does not raise any novel 

regulatory issues and instead provides 

additional clarity in the rule text. 

Accordingly, the Commission finds 

good cause for approving the proposed 

rule change, as modified by Amendment 

No. 1, on an accelerated basis. 

VI. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,97 that the 

proposed rule change (File No. SR– 

NYSEAMER–2017–15), as modified by 

Amendment No. 1, is approved on an 

accelerated basis. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.98

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2017–24576 Filed 11–13–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

32898; File No. 812–14775] 

Meeder Funds Trust, et al. 

November 8, 2017. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice. 

Notice of an application for an order 

under section 12(d)(1)(J) of the 

Investment Company Act of 1940 (the 

‘‘Act’’) for an exemption from sections 

12(d)(1)(A) and (B) of the Act and under 

sections 6(c) and 17(b) of the Act for an 

exemption from sections 17(a)(1) and (2) 

of the Act. 

The requested order would permit 

certain registered open-end investment 

companies to acquire shares of certain 

registered open-end investment 

companies that are outside of the same 

group of investment companies as the 

acquiring investment companies, in 


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