Document ID: SEC-2012-1349-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ OMX PHLX LLC
Posted Date: 2012-08-15T04:00Z

[Federal Register Volume 77, Number 158 (Wednesday, August 15, 2012)]
[Notices]
[Pages 49045-49046]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-19981]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67630; File No. SR-Phlx-2012-101]

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

August 9, 2012.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on July 30, 2012, 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 Substance 
of the Proposed Rule Change

    The Exchange proposes to adopt a new Rule 1046 entitled ``Clearing 
Arrangements'' to further clarify the text of Exchange Rule 911, 
entitled ``Member and Member Organization Participation'' with respect 
to the requirement to have a membership in or access arrangement with a 
clearing agency.
    The text of the proposed rule change is available on the Exchange's 
Web site at http://nasdaqtrader.com/micro.aspx?id=PHLXfilings, at the 
principal office of the Exchange, on the Commission's Web site at 
http://www.sec.gov, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to adopt a new Rule 1046 
to provide clarity for members or member organizations that are 
conducting an options business on the Exchange. Exchange Rule 911 
requires initial and continuing compliance with the provisions of 
Exchange Rule 911 to participate in the Exchange as a member or member 
organization. Specifically, Rule 911(a)(2) states that ``membership in, 
or access arrangement with a member of, a clearing agency registered 
with the Commission which maintains facilities through which Exchange 
compared trades may be settled'' is required initially upon membership 
with the Exchange and must be continually maintained during membership. 
The Rule applies broadly to all members and member organizations, 
whether they conduct equities or options business, but does not 
specifically define what qualifies as a clearing arrangement.
    The Exchange is proposing to clarify this requirement by adopting 
Rule 1046, entitled ``Clearing Arrangements,'' specifically applicable 
to Exchange members and member organizations conducting an options 
business. Rule 1046 would require a member or member organization 
conducting an options business to either have a direct membership in 
The Options Clearing Corporation (``the OCC''), or an indirect 
relationship with an Exchange member organization that is a clearing 
member of the OCC.
    The Exchange believes the proposed language further clarifies the 
existing requirement of Rule 911 by specifying that a clearing 
arrangement means a direct membership with the OCC or an indirect 
relationship with an Exchange member organization that has a membership 
in the OCC. The Exchange believes this is not a substantive change but 
rather a clarifying amendment.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \3\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \4\ in particular, in that it is designed to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general to protect investors and the public interest.
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    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that clarifying its current text by adopting 
a new Rule 1046 to specify the types of clearing arrangements a member 
or member organization conducting an options business is required to 
obtain and maintain will assist prospective and current members in 
understanding the obligations of Rule 911 relating to clearing 
arrangements. The proposed rule serves to codify with specificity the 
obligations which today apply to current Exchange members and member 
organizations.\5\ The proposed amendment is non-substantive.
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    \5\ All current members and member organizations today comply 
with proposed Rule 1046.
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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.

[[Page 49046]]

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

    Pursuant to Section 19(b)(3)(A) of the Act \6\ and Rule 19b-4(f)(1) 
\7\ thereunder, the Exchange has designated this proposal as one that 
constitutes a stated policy, practice or interpretation with respect to 
the meaning, administration, or enforcement of an existing rule of the 
SRO, and therefore has become effective.
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    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(1).
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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 necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-Phlx-2012-101 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-2012-101. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of the filing also will be available for 
inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-Phlx-2012-101 and should be 
submitted on or before September 5, 2012.
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    \8\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-19981 Filed 8-14-12; 8:45 am]
BILLING CODE 8011-01-P