Document ID: SEC-2013-0945-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ OMX PHLX LLC
Posted Date: 2013-05-21T04:00Z

[Federal Register Volume 78, Number 98 (Tuesday, May 21, 2013)]
[Notices]
[Pages 29797-29801]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-12040]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69586; File No. SR-Phlx-2013-50]

Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Relating to 
FLEX Options

May 15, 2013.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given 
that on May 2, 2013, NASDAQ OMX 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    The Exchange proposes to amend Exchange Rule 1079 entitled ``FLEX, 
Index, Equity and Currency Options'' and Option Floor Procedure Advice 
(``OFPA'') F-28 entitled ``Trading FLEX Index, Equity and Currency 
Options.''
    The text of the proposed rule change is available on the Exchange's 
Web site at http://www.nasdaqtrader.com/micro.aspx?id=PHLXRulefilings, 
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 the 
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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to amend Exchange Rule 
1079(a) which concerns the characteristics applicable to FLEX options 
and 1079(b) and eliminate OFPA F-28 which concerns the procedures for 
quoting and trading FLEX options.\3\ The Exchange is proposing to amend 
its FLEX rules in Rule 1079 to establish the same procedures for 
quoting and trading FLEX options as exist today on NYSE MKT LLC 
(``Amex'').\4\
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    \3\ The term ``FLEX option'' means a FLEX option contract that 
is traded subject to this Rule. Although FLEX options are generally 
subject to the rules in this section, to the extent that the 
provisions of this Rule are inconsistent with other applicable 
Exchange rules, this Rule takes precedence with respect to FLEX 
options.
    \4\ See Amex Rule 904G (FLEX Trading Procedures and Principles).
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    Today, a Requesting Member shall obtain quotes and execute trades 
in certain non-listed FLEX options at the specialist post of the non-
FLEX option on the Exchange. The Requesting Member is a Phlx member 
qualified to trade FLEX options pursuant to paragraph (c) of Rule 1079 
who initiates a FLEX Request For Quotes (``RFQ'') pursuant to paragraph 
(b) of Rule 1079. FLEX options are not continuously quoted and series 
are not pre-established.\5\ Today a Requesting Member may initiate an 
RFQ by first announcing all of the following contract terms to the 
trading crowd of the non-FLEX option and then submitting an RFQ ticket 
to that specialist post: (1) Underlying index, security or foreign 
currency, (2) type, size and crossing intention (3) in the case of FLEX 
index options and FLEX equity options, exercise style, (4) expiration 
date, (5) exercise price, and, (6) respecting index options, the 
settlement value. Thereafter, on receipt of an RFQ in proper form, the 
assigned specialist or Requesting Member shall cause the terms of the 
RFQ to be disseminated as an administrative text message through the 
Options Price Reporting Authority (``OPRA'').
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    \5\ The Exchange's electronic quoting and trading system is not 
available for FLEX options. The variable terms of FLEX options shall 
be established through the process described in Rule 1079. All 
transactions must be in compliance with Section 11 of the Securities 
Exchange Act of 1934 and the rules promulgated thereunder, which may 
include yielding priority to customer orders.
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    The Exchange proposes to adopt rules, similar to Amex, which 
requires a Requesting Member to submit to the FLEX Specialist an RFQ 
utilizing for that purpose the forms, formats and procedures 
established by the Exchange. Thereafter, on receipt of an RFQ in proper 
form, the assigned FLEX Specialist shall cause the terms and 
specifications of the RFQ to be immediately announced at the post. Such 
communication shall be disseminated as an administrative text message 
through the Options Price Reporting Authority (``OPRA'').\6\
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    \6\ See proposed Rule 1079(b)(1).
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    Today, following the RFQ announcement, a preset response time will 
begin, during which members may provide responsive quotes. The response 
time, between two and 15 minutes, will be determined by the Exchange. 
During the response time, members may provide responsive quotes to the 
RFQ, which may be entered, modified or withdrawn during such response 
time. Each assigned ROT

[[Page 29798]]

and assigned specialist \7\ who responds is required to respond with a 
market of the minimum size, but is not required to provide continuous 
quotes or a minimum bid-offer differential (quotation spread 
parameters).
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    \7\ Pursuant to Rule 1079(c), a ROT or specialist may apply on a 
form prescribed by the Exchange to be assigned in FLEX options. At 
least two members shall be assigned to each FLEX option. Only the 
specialist in the non-FLEX option may be the assigned specialist in 
that FLEX option (``FLEX Specialist''). The provisions of Rule 
1014(c) regarding market making obligations shall be applicable to 
assigned ROTs and assigned specialists, such that a market must be 
provided in any FLEX option when requested by an Options Exchange 
Official. The Exchange proposes to define ``FLEX Specialist'' within 
Rule 1079(c).
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    The Exchange proposes to adopt rules, similar to Amex, which 
provide that Members may enter at the FLEX post FLEX Quotes responsive 
to each Request for Quotes. FLEX Quotes must be entered during the 
Request Response Time.\8\ Each FLEX Quote shall refer to a reference 
indicator as the Exchange determines appropriate from time to time. All 
FLEX Quotes may be entered, modified or withdrawn at any point during 
the Request Response Time. At the expiration of the Request Response 
Time, the best bid or offer (``BBO'') shall be identified in accordance 
with the price and time priority principles set forth by the 
Exchange.\9\
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    \8\ The Exchange proposes to notify its members of the time 
period for the Request Response Time by issuing a memorandum to the 
Exchange members on the trading floor. The Exchange intends to 
provide a reasonable notice period to members if it determines to 
change the Request Response Time.
    \9\ See proposed Rule 1079(b)(2).
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    Today, with respect to the BBO, at the end of the response time, 
the assigned specialist, or if none, the Requesting Member shall 
determine the BBO, based on price, but not time or size. However, where 
two or more bids/offers are at parity, bids/offers submitted by an 
assigned specialist, assigned ROT or customer will have priority over 
bids/offers submitted by non-assigned ROTs and by controlled accounts 
as defined in Rule 1014(g)(i). The BBO shall be disseminated with 
reference to the corresponding RFQ. Further, if the Requesting Member 
rejects the BBO or the BBO is for less than the entire size requested, 
the BBO Improvement Interval provides a two minute time period during 
which the BBO may be matched or improved. An assigned ROT or assigned 
specialist who responded with a market during the response time may 
immediately join any new BBO. The new BBO shall be determined, and 
disseminated with reference to the corresponding RFQ.
    The Exchange proposes to amend this portion of the rule to instead 
state, similar to Amex, that at the expiration of the Request Response 
Time, the BBO shall be displayed on such market data systems as are 
available. If the Requesting Member has not indicated an intention to 
cross or act as principal with respect to any part of the FLEX trade, 
the member shall promptly accept or reject the displayed BBO: Provided, 
however, that if such a Requesting Member either rejects the BBO or is 
given a BBO for less than the entire size requested, all FLEX 
participating members other than the Requesting Member will have an 
opportunity during the BBO Improvement Interval in which to match, or 
improve, (as applicable), the BBO. At the expiration of any such BBO 
Improvement Interval, the Requesting Member must promptly accept or 
reject the BBO(s). If the Requesting Member has indicated an intention 
to cross or act as principal with respect to any part of the FLEX 
trade, acceptance of the displayed BBO shall be automatically delayed 
until the expiration of the BBO Improvement Interval. Prior to the BBO 
Improvement Interval, the Requesting Member must indicate at the post 
the price at which the member expects to trade. In these circumstances, 
the Requesting Member may participate with all other FLEX-participating 
members in attempting to improve or match the BBO during the BBO 
Improvement Interval. At expiration of the BBO Improvement Interval, 
the Requesting Member must promptly accept or reject the BBO(s). The 
Requesting Member has no obligation to accept any FLEX bid or offer. 
Whenever, following the completion of FLEX bidding and offering 
responsive to a given RFQs, the Requesting Member rejects the BBO or 
the BBO size exceeds the FLEX transaction size indicated in the RFQs, 
members may accept the entire order or the unfilled balance of the BBO. 
The highest bid shall have priority, but where the two or more best 
bids are submitted at the same price, the bid(s) submitted first in 
time will have priority. The lowest offer shall have priority, but 
where the two or more best offers are submitted at the same price, the 
offer(s) submitted first in time will have priority. In the case of 
FLEX equity options only and notwithstanding Rule 1079(b)(4), whenever 
the Requesting Member has indicated an intention to cross or act as 
principal on the trade and has matched or improved the BBO during the 
BBO Improvement Interval, the Requesting Member will be permitted to 
execute the contra side of the trade that is the subject of the RFQs, 
to the extent of at least 40% of the trade, provided the order is a 
public customer order or an order respecting the Requesting Member's 
firm proprietary account. Notwithstanding the foregoing, all market 
participants may effect crossing transactions.\10\
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    \10\ See proposed Rule 1079(b)(3).
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    The Exchange would eliminate the provisions that today describe 
trading, such that a trade in FLEX options cannot be executed until the 
end of the response time or BBO Improvement Interval. Today, once the 
response time or Improvement Interval ends, the Requesting Member is 
given the first opportunity to trade on the market, by voicing a bid/
offer in the trading crowd. The Requesting Member has no obligation to 
accept any bid or offer for a FLEX option. If the Requesting Member 
rejects the BBO or the BBO size exceeds the entire size requested, 
another member may promptly accept such BBO or the unfilled balance of 
the BBO. Once the BBO is established and no trade has occurred, the RFQ 
remains open during that trading day, such that a member may re-quote 
the market with respect to the open RFQ, as opposed to submitting an 
additional RFQ. An assigned ROT or assigned specialist who responded to 
the open RFQ during the response time or BBO Improvement Interval may 
immediately join the re-quoted market, thus matching for parity 
purposes. The original Requesting Member is not given the first 
opportunity to trade on the re-quoted market, nor is the re-quoting 
member. If a trade occurs, that RFQ is no longer open and a new RFQ is 
required. The specialist in the listed non-FLEX equity, index or U.S. 
dollar-settled foreign currency option, whether or not assigned in FLEX 
options, must accept FLEX orders on the FLEX book after completion of 
the RFQ process. Only customer day limit orders may be placed on the 
FLEX index, equity or U.S. dollar-settled foreign currency option book. 
Booked orders expire at the end of each trading day. The limit price 
and size must be written on the RFQ ticket and submitted for 
dissemination. In order to trade with the book, an executing member 
must quote the market and announce the trade.\11\
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    \11\ Acceptance of a bid/offer creates a binding contract under 
Exchange Rules.
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    Today, the Exchange has procedures for crossing which require that 
whenever a Requesting Member intends to cross, after the BBO is 
determined, with or without a BBO Improvement Interval, the Requesting 
Member, having announced an intention to cross, must bid and offer at 
or better than the BBO. If the Requesting Member's bid/offer is

[[Page 29799]]

at the BBO, the Requesting Member may execute 25% or a fair split, 
whichever is greater, of the contra-side of the order that is the 
subject of the RFQ. The remainder of the contra-side is split in 
accordance with the parity/priority provision of subparagraph (3) of 
Rule 1079(b). If the Requesting Member's bid/offer improves the 
existing BBO, an assigned ROT or assigned specialist who responded with 
a market during the response time or BBO Improvement Interval, may 
immediately join the Requesting Member's improved bid or offer, thus 
matching for parity purposes. However, the Requesting Member may 
execute 25% or a fair split, whichever is greater, of the contra-side 
of the order that is the subject of the RFQ. The remainder of the 
contra-side is split in accordance with the parity/priority provision 
of sub-paragraph (3) of Rule 1079. Broker-dealer crosses and solicited 
orders, as defined in Rule 1064, are not eligible for the split 
afforded by sub-paragraphs (A) and (B) of Rule 1079(6), and instead, 
are, after the announcement of an intention to cross, executable in 
accordance with sub-paragraph (5) of Rule 1079.
    The Exchange proposes to amend the crossing rules, similar to Amex, 
in that the Requesting Member would be entitled to cross a transaction 
where the BBO was matched or improved and could execute the contra side 
to the extent of at least 40% of the trade, provided the order is a 
public customer order or an order respecting the Requesting Member's 
firm proprietary account.\12\ The Exchange would not otherwise limit a 
market participant's ability to cross an order, other market 
participants other than public customer and firm proprietary orders 
would not be entitled to execute the contra side of the trade to the 
extent of at least 40% of the trade.
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    \12\ See proposed Rule 1079(b)(5).
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    The Exchange does not propose to amend the current reporting 
requirements which require RFQs, responsive quotes and completed trades 
to be promptly reported to OPRA and disseminated as an administrative 
text message.\13\ Nor does the Exchange proposes to amend the 
provisions related to trading rotations which provide that there will 
be no trading rotations in FLEX options, either at the opening or at 
the close of trading.\14\ Finally, the Exchange does not proposes to 
amend the hours of trading must currently state that FLEX options 
trading must be effected during the hours established by the Exchange. 
Such hours shall be within regular Exchange trading hours (for the non-
FLEX option) on each business day, except that the Exchange in its 
discretion may determine at any time to narrow or expand FLEX trading 
hours to encompass, but not exceed, the trading hours of the non-FLEX 
option.\15\
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    \13\ See Rule 1079(b)(7).
    \14\ See Rule 1079(b)(8).
    \15\ See Rule 1079(b)(9).
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    Provision (c) of Rule 1079 related to who may trade FLEX Options, 
provision (d) relating to position limits and position (e) related to 
exercise limits are not being amended. Section (f) which provides that 
FLEX equity and currency options shall be subject to the exercise-by-
exercise procedure of Rule 805 of the Options Clearing Corporation 
(``OCC'') is being amended to capitalize the OCC title.
    The Exchange is also proposing to amend Rule 1079(a) to add certain 
defined terms in connection with the proposed amendments to Rule 
1079(b). Specifically, the Exchange proposes to define the term 
``Request for Quotes'' as the initial request supplied by a Requesting 
Member to initiate FLEX bidding and offering. The Exchange proposes to 
define the term ``Request Response Time'' as the minimum period of time 
established by the Exchange, during which Exchange members 
participating in FLEX options may provide FLEX Quotes in response to a 
Request for Quotes. The Exchange proposes to define the term ``FLEX 
Quote'' as (i) FLEX bids and offers entered by specialists \16\ and 
Registered Options Traders \17\ and (ii) orders to purchase and orders 
to sell FLEX Options entered by Floor Brokers, in each case in response 
to a Request for Quotes. The Exchange proposes to define the term 
``BBO'' as the best bid or offer, or both, as applicable, entered in 
response to a Request for Quotes. The Exchange proposes to define the 
term ``BBO Improvement Interval'' as the minimum period of time, to be 
established by the Exchange, during which members may submit FLEX 
Quotes to meet or improve the BBO established during the Request 
Response Time.
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    \16\ A specialist is an Exchange member who is registered as an 
options specialist pursuant to Rule 1020(a).
    \17\ A Registered Options Trader (``ROT'') includes a Streaming 
Quote Trader (``SQT''), a Remote Streaming Quote Trader and a Non-
SQT, which by definition is neither a SQT or a RSQT. A Registered 
Option Trader is defined in Exchange Rule 1014(b) as a regular 
member of the Exchange located on the trading floor who has received 
permission from the Exchange to trade in options for his own 
account. See Exchange Rule 1014 (b)(i) and (ii).
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    Finally, the Exchange proposes to eliminate OFPA F-28, which 
reiterates the procedures for quoting and trading FLEX options similar 
to Rule 1079, as this rule is no longer necessary. OFPA-F28 was enacted 
to parallel most of the provisions in Rule 1079(b), including those 
pertaining to requesting quotations, responses, determining the BBO, 
the BBO Improvement Interval, executing a trade and crossing. OFPA F-28 
does not contain a fine schedule and is not included in the Exchange's 
minor rule violation enforcement and reporting plan.\18\ The Exchange 
noted in its rule change that the purpose of adopting OFPA F-28 was to 
incorporate it into the Floor Procedure Advice Handbook for easy 
reference on the trading floor.\19\
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    \18\ See Securities Exchange Act Release No. 39549 (January 14, 
1998), 63 FR 3601 (January 23, 1998) (SR-Phlx-96-38).
    \19\ Id.
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    The Exchange believes that these amendments to the FLEX rules to 
model the rules after the current Amex rules, streamlines the current 
process for quoting and trading FLEX Options. Amex initially amended 
its rule in 2006 \20\ to increase the participation guarantee of a 
Requesting Member from 25% to 40% of the order.\21\ Amex noted in its 
filing that they believed that providing Requesting Members or 
Requesting Member firms who are eligible to trade FLEX options and are 
seeking to cross or facilitate a trade with an across-the-board 40% 
member firm guarantee will provide an additional incentive for such 
Requesting Member or Requesting Member firm to bring large FLEX orders 
to the floor of the Amex rather than to the floor of another options 
exchange or to the over-the-counter (``OTC'') market.\22\ Additionally, 
Amex noted that the liquidity provided by such Requesting Member or 
Requesting Member firm seeking to facilitate their orders gives the 
Exchange the ability to provide deep liquid markets for investors.
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    \20\ See Securities Exchange Act Release No. 54104 (July 5, 
2006), 71 FR 39374 (July 12, 2006) (SR-Amex-2006-47).
    \21\ Id.
    \22\ Id.
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    The Exchange believes that the amendments proposed to Rule 1079(b) 
would also allow Phlx to remain competitive with other options 
exchanges. The proposal streamlines the current FLEX rules related to 
quoting and trading FLEX options and creates new opportunities for 
members and member organizations to trade FLEX options on the floor of 
the Exchange. The proposal provides for transparency in displaying the 
terms and specifications of the RFQ at the post and continues to 
provide for the dissemination of information through

[[Page 29800]]

OPRA. The proposal eliminates the minimum response times imposed by the 
current rules and instead adopts Amex's more flexible approach to 
permit responses during the Request Response Time as designated by the 
Exchange. The amendments provide for opportunities to match or improve 
the BBO and sets priority rules as first in time as compared to price, 
as is the case today. The Exchange believes that these rules will 
permit the Exchange to remain competitive and will continue to 
encourage market participants to shift OTC options trading to the 
Exchange in order to eliminate counter-party risk. The Exchange is 
proposing to increase its guarantee from 25% to 40% consistent with 
current firm facilitation guarantees and, similar to Amex, offer 
requesting members that cross public customer and firm proprietary 
orders the opportunity to participate in 40% of the trade.\23\ The 
Exchange believes that, as noted in the Amex filing, the liquidity 
provided by such Requesting Member or Requesting Member firm seeking to 
facilitate their orders gives the Exchange the ability to provide deep 
liquid markets for investors. The Exchange believes this proposal will 
allow the Exchange to remain competitive with other options exchanges 
and provide a comparable alternative to the OTC market.
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    \23\ See Exchange Rule 1064 at Commentary .02.
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    The Exchange proposes, similar to Amex Rule 904G(f), to limit 
crossing orders that are entitled to participate in the trade and be 
guaranteed at least 40% of the trade to public customer orders and firm 
proprietary orders. Unlike Amex, the Exchange would not otherwise limit 
a market participant's ability to effect a crossing transaction. The 
Exchange is proposing to permit all market participants to cross a 
transaction, as is the case today. The Exchange does not believe this 
proposal would amend the current practice of permitting market 
participants to participate in crossing orders, except for Broker-
Dealer crosses which today are not eligible for the split referenced in 
current Rule 1079(b)(6)(A) and (B),\24\ but they are executable as 
described in current Rule 1079(b)(5). The proposal would permit all 
market participants to effect crossing transactions, which is not a 
departure from the current rule, but would limit crossing orders that 
are entitled to participate in the trade and receive the 40% guarantee 
to public customer orders and firm proprietary orders, which is not a 
change for Broker-Dealers but is a change for other market participants 
that today may be eligible for the 25% guarantee in the current rule.
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    \24\ Today, if the Requesting Member's bid/offer is at the BBO, 
the Requesting Member may execute 25% or a fair split, whichever is 
greater, of the contra-side of the order that is the subject of the 
RFQ. If the Requesting Member's bid/offer improves the existing BBO, 
an assigned ROT or assigned Specialist who responded with a market 
during the response time or BBO Improvement Interval, may 
immediately join the Requesting Member's improved bid or offer, thus 
matching for parity purposes. However, the Requesting Member may 
execute 25% or a fair split, whichever is greater, of the contra-
side of the order that is the subject of the RFQ.
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    The Exchange is not adopting language in Amex Rule 904(G)(g). The 
Exchange does not trade the particular currencies listed in 904(G)(g) 
and is therefore not adopting language similar to section 904G(g).\25\
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    \25\ The Exchange has separate rules relating to trading FLEX 
foreign currencies minimum increments. See Exchange Rule 1005C.
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    In addition, the Exchange proposes in Rule 1079(b)(1) to 
immediately announce the terms and specifications of the RFQ at the 
specialist post instead of posting the terms and specifications. The 
practice of announcing terms at the post is in line with current 
practices on Phlx's floor. The Exchange will continue to disseminate an 
administrative text message through OPRA, as is the case today.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Securities and Exchange Act of 
1934 (``Exchange Act''),\26\ in general, and with Section 6(b)(5) of 
the Exchange Act,\27\ in particular, in that the proposal is 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.
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    \26\ 15 U.S.C. 78f.
    \27\ 15 U.S.C. 78f(b)(5).
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    FLEX options permit customization of certain variable terms as 
agreed between the buyer and seller. The Exchange believes that its 
proposed rules allow market participants to continue to trade FLEX 
options in a transparent environment with the same requisite disclosure 
requirements in order to ensure that presence of a price discovery 
process for such orders on the Exchange's trading floor. The Exchange 
believes that the proposed amendments will create new opportunities for 
members and member organizations to trade FLEX options. The amendments 
create clear guidelines for transacting FLEX options, which are 
complicated customized options. Additionally, the amendments streamline 
the process and adopt procedures for quoting and trading FLEX options 
similar to Amex.\28\ The Exchange desires to provide investors deep 
liquid markets in which to trade FLEX options and believes that 
adopting rules similar to Amex will allow the Exchange to provide 
investors the tools to transact FLEX options in a transparent 
environment.
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    \28\ See note 19. [sic]
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange proposes to adopt 
rules to permit the quoting and trading of FLEX options on the 
Exchange's trading floor similar to Amex.\29\ The Exchange believes 
that its ability to remain competitive and provide market participants 
multiple venues in which to trade FLEX options in a similar manner 
benefits market participants by providing them choices in which to seek 
markets to transact these products. The Exchange believes that this 
filing does not impose a burden on competition in as much as the rules 
are not novel but rather are the same as the rules of Amex.
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    \29\ Id.
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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)(ii) of the Act \30\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\31\
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    \30\ 15 U.S.C. 78s(b)(3)(a)(ii). [sic]
    \31\ 17 CFR 240.19b-4(f)(6).
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    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

[[Page 29801]]

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. 
The Exchange has provided 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 business days prior to 
the date of filing of the proposed rule change.

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-2013-50 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-Phlx-2013-50. 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 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-Phlx-2013-50, and should be submitted on 
or before June 11, 2013.
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    \32\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\32\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-12040 Filed 5-20-13; 8:45 am]
BILLING CODE 8011-01-P