Document ID: SEC-2016-0459-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Chicago Stock Exchange, Inc.
Posted Date: 2016-03-15T04:00Z

[Federal Register Volume 81, Number 50 (Tuesday, March 15, 2016)]
[Notices]
[Pages 13857-13861]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-05752]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77331; File No. SR-CHX-2016-01]

Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; 
Notice of Filing of Proposed Rule Change To Adopt and Amend Rules To 
Permit the Exchange To Initiate CHX SNAP[hairsp]\SM\ Cycles

March 9, 2016.
    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 February 26, 2016, the Chicago Stock Exchange, Inc. (``CHX'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I and II below, which Items have been prepared by the Exchange. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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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

    CHX proposes to adopt and amend rules to permit the Exchange to 
initiate CHX SNAP[hairsp]\SM\ cycles. The text of this proposed rule 
change is available on the Exchange's Web site at http://www.chx.com/rules/proposed_rules.htm, at the principal office of the Exchange, and 
at the Commission's Public Reference Room.

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

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

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

1. Purpose
    The Exchange proposes to adopt and amend rules to permit the 
Exchange to initiate CHX SNAP (``SNAP'') Cycles.\3\ Currently, a SNAP 
Cycle may only be initiated upon receipt of a valid limit order marked 
Start SNAP (``Start SNAP order'') submitted by an order sender.\4\ The 
Exchange now proposes to permit the Exchange to initiate a SNAP Cycle, 
without receipt of a valid Start SNAP order, if a periodic pro forma 
SNAP review of the contents of the CHX book, SNAP Auction Only Order 
(``AOO'') Queue \5\ and Protected Quotations of external markets, in a 
given security, show that the projected execution size that would 
result if a SNAP Cycle were to be initiated at that moment would meet 
certain minimum size and notional value requirements, as applicable 
(``Exchange-initiated SNAP''). This proposal is designed to permit 
marketable, yet inactive passive liquidity of a substantial size (i.e., 
inactive SNAP AOOs), to execute via SNAP in the absence of a Start SNAP 
order. The proposed rule change does not modify the operation of SNAP 
Cycles in any other way.
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    \3\ See Securities Exchange Act Release No. 76262 (October 26, 
2015), 80 FR 67440 (November 2, 2015) (SR-CHX-2015-05); see also 
Securities Exchange Act Release No. 76087 (October 6, 2015), 80 FR 
61540 (October 13, 2015); see also Securities Exchange Act Release 
No. 75346 (July 1, 2015), 80 FR 39172 (July 8, 2015) (SR-CHX-2015-
03). The approved rule changes are not yet operative and will become 
operative upon two weeks' notice by the Exchange to its 
Participants.
    \4\ See supra id.; see also CHX Article 1, Rule 2(h)(1); see 
also CHX Article 18, Rule 1(b)(1).
    \5\ See supra note 3; see also CHX Article 20, Rule 8(b)(2)(A).

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[[Page 13858]]

Background
    In sum, a SNAP Cycle \6\ is comprised of the following five stages:
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    \6\ See supra note 3; see also CHX Article 18, Rule 1(b).
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     Stage one--Initiating the SNAP Cycle;
     Stage two--SNAP Order Acceptance Period;
     Stage three--Pricing and Satisfaction Period;
     Stage four--Order Matching Period; and
     Stage five--Transition to the Open Trading State.\7\
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    \7\ See supra note 3; see also CHX Article 1, Rule 1(qq).

Currently, only Start SNAP orders that meet minimum size, price and 
time of receipt requirements could initiate a SNAP Cycle.\8\ Moreover, 
a Start SNAP order sender may instruct the Exchange to cancel the SNAP 
Cycle if a minimum execution size condition would not be met.\9\ Upon 
receipt and acceptance of a valid Start SNAP order, order cancellations 
in the security would be prohibited \10\ and a SNAP Cycle would proceed 
as follows:
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    \8\ See supra note 3; see also CHX Article 1, Rule 2(h)(1).
    \9\ See id.
    \10\ Among other things, order cancellation messages would be 
queued for processing at the conclusion of the SNAP Cycle. See supra 
note 3; see also CHX Article 18, Rule 1(b)(2)(C)(i).
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     During the stage one Initiating the SNAP Cycle, automated 
trading in the subject security on the Exchange would be suspended and 
remain suspended for the duration of the SNAP Cycle.
     During the stage two SNAP Order Acceptance Period, the 
Exchange will transition precedent SNAP Eligible Orders \11\ to the 
SNAP CHX book and accept new SNAP Eligible Orders for a randomized time 
period for inclusion on the SNAP CHX book.\12\
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    \11\ See supra note 3; see also CHX Article 1, Rule 1(ss).
    \12\ See supra note 3; see also CHX Article 18, Rule 1(b)(2); 
see also CHX Article 20, Rule 8(b)(3).
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     During the stage three Pricing and Satisfaction Period, 
the Exchange will attempt to ascertain a single auction price (i.e., 
``SNAP Price'') \13\ from SNAP Eligible Orders resting on the SNAP CHX 
book based on a new market snapshot (``stage three market snapshot''). 
If the SNAP Price is determined to be at a price that would require 
orders to be routed away, the Exchange would route away SNAP Eligible 
Orders resting on the SNAP CHX book.\14\ Immediately after the 
necessary orders are routed away, the SNAP Cycle would enter the 
Satisfaction Period, during which time the Exchange would delay 
proceeding to the stage four Order Matching Period for a period of time 
not to exceed 200 milliseconds to allow for confirmations of routed 
orders to be received from external markets. However, if the SNAP Price 
does not require orders to be routed away, the SNAP Cycle would 
immediately proceed to the stage four Order Matching Period. Moreover, 
if the SNAP Price could not be confirmed, the SNAP Cycle would be 
aborted and immediately proceed to the stage five Transition to the 
Open Trading State.\15\
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    \13\ See supra note 3; see also CHX Article 1, Rule 1(rr).
    \14\ See supra note 3; see also CHX Article 19, Rule 3(a)(4) and 
(5).
    \15\ See supra note 3; see also CHX Article 1, Rule 1(qq).
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     During the stage four Order Matching Period, SNAP Eligible 
Orders on the SNAP CHX book would execute at the SNAP Price within the 
Matching System.\16\
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    \16\ See supra note 3; see also CHX Article 18, Rule 1(b)(4).
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     During the stage five Transition to the Open Trading 
State, unexecuted SNAP Eligible Orders, as well as other orders and 
cancel messages that have been queued during the SNAP Cycle, would be 
transitioned to the CHX book for automated trading based on a new 
market snapshot.\17\ During the transition, orders may, among other 
things, be executed within the Matching System or be routed away in a 
manner consistent with how orders are currently executed and routed 
during automated trading.\18\
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    \17\ See supra note 3; see also CHX Article 18, Rule 1(b)(5).
    \18\ See CHX Article 19, Rule 3(a)(1)-(3); see also CHX Article 
20, Rule 8(e)(1).
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Proposed Article 18, Rule 1A (Initiating SNAP)
    The Exchange now proposes to adopt Article 18, Rule 1A, which 
describes the current and proposed mechanisms for initiating SNAP 
Cycles. Thereunder, proposed paragraph (a) provides that subject to 
current Article 18, Rule 1(c),\19\ a SNAP Cycle in a security shall be 
initiated either (1) upon receipt of a valid limit order marked Start 
SNAP, as defined under current Article 1, Rule 2(h)(1), or (2) by the 
Exchange pursuant to proposed paragraph (b). Specifically, proposed 
paragraph (a)(1) is a restatement of language from current Article 18, 
Rule 1(b)(1) that provides that a SNAP Cycle would be initiated upon 
receipt of a limit order marked Start SNAP,\20\ whereas proposed 
paragraph (a)(2) is new language that refers to the proposed Exchange-
initiated SNAP mechanism, as described in detail under proposed 
paragraph (b).
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    \19\ See supra note 3; CHX Article 18, Rule 1(c) provides, among 
other things, that if a trading halt, pause or suspension is in 
effect for the subject security that requires the Exchange to 
suspend trading in that security at the time a limit order marked 
Start SNAP is received, a SNAP Cycle shall not be initiated. In 
light of the proposed Exchange-initiated SNAP mechanism, the 
Exchange proposes to amend CHX Article 18, Rule 1(c) to provide 
generally that a SNAP Cycle shall not begin in a security if a 
trading halt, pause or suspension is in effect for a subject 
security that requires the Exchange to suspend trading in that 
security.
    \20\ Correspondingly, the Exchange proposes to amend current 
Article 18, Rule 1(b)(1) to contemplate proposed Rule 1A and to 
amend the subtitle of current Rule 1(b)(1) to provide ``Beginning 
the SNAP Cycle,'' so as to clarify the distinction between the 
initiation of a SNAP Cycle, as described under proposed Rule 1A, and 
the initial steps that would be taken thereafter.
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    Proposed paragraph (b) details the circumstances under which the 
Exchange would initiate a SNAP Cycle in a security. It provides that 
during the Open Trading State for each SNAP-eligible security and at 
preprogrammed intervals,\21\ the Exchange shall review the CHX book, 
SNAP AOO Queue and Protected Quotations of external markets to 
determine whether sufficient liquidity exists to initiate a SNAP Cycle 
without the receipt of a valid limit order marked Start SNAP (``pro 
forma SNAP review''). Proposed paragraph (b) continues by providing 
that in conducting the pro forma SNAP review, the Exchange shall take a 
market snapshot of the Protected Quotations of external markets in the 
subject security and calculate a pro forma SNAP Price, as defined under 
current Article 1, Rule 1(rr),\22\ to determine:
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    \21\ On a technical level, the Matching System is comprised of 
several Matching Engines and each security traded on the Exchange is 
placed into only one Matching Engine. The Exchange proposes to 
conduct pro forma SNAP reviews of each SNAP-eligible security in a 
given Matching Engine consecutively and continuously in a preset 
order. The Exchange will not modify this procedure absent an 
approved filing pursuant to Rule 19b-4 under the Act.
    \22\ The Exchange notes that the calculation of the pro forma 
SNAP Price is identical to the calculation of the SNAP Price during 
the stage three Pricing and Satisfaction Period, except that the pro 
forma SNAP Price calculation would not include any new orders 
received during the stage two Order Acceptance Period, as a SNAP 
Cycle would not have yet been initiated. Example 2 below describes 
how the pro forma SNAP Price would be calculated.
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    (1) Whether the projected execution size (``PES'') at the pro forma 
SNAP Price is equal to or greater than the corresponding minimum PES, 
as described under paragraph (d); and
    (2) whether the PES within the Matching System at the pro forma 
SNAP Price would be equal to or greater than 80% of the corresponding 
minimum PES.

If the conditions set forth under proposed paragraphs (b)(1) and (2) 
are

[[Page 13859]]

met, the Exchange shall initiate a SNAP Cycle pursuant to current 
Article 18, Rule 1(b), subject to proposed paragraph (c). Proposed 
paragraphs (b) is designed to ensure that a SNAP Cycle would only be 
initiated by the Exchange if marketable passive liquidity of a 
substantial size is available at the Exchange.\23\ Specifically, the 
condition set forth under proposed paragraph (b) is intended to avoid a 
scenario where the market snapshot taken pursuant to proposed paragraph 
(b) shows substantial liquidity displayed away from the Exchange, but 
by the time the SNAP Cycle is initiated and the stage three market 
snapshot is taken to determine the actual SNAP Price, the away 
liquidity has disappeared, thus resulting in an aggregate SNAP 
execution size that is much smaller than the PES. By requiring that 80% 
of the PES be projected to occur within the Matching System, this 
scenario is avoided.\24\
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    \23\ The Exchange notes that the aggregate size of the stage 
three SNAP executions may be substantially larger than the PES due 
to, among other things, the possibility of new orders being received 
during the stage two Order Acceptance Period. See supra note 3; see 
also CHX Article 18, Rule 1(b)(2).
    \24\ Since order cancellations are prohibited during a SNAP 
Cycle, the liquidity at the Exchange ascertained from the pro forma 
SNAP review would always be available by the stage three market 
snapshot if a SNAP Cycle were initiated by the Exchange. See supra 
note 3; see also CHX Article 18, Rule 1(b)(2)(C)(i).
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    Proposed paragraph (d) is similar to current Article 1, Rule 
2(h)(1)(A)(i) and provides that the minimum PES for an Exchange-
initiated SNAP pursuant to proposed paragraph (b) shall either be (1) 
2,500 shares with a minimum aggregate notional value of $250,000 based 
on the midpoint of the National Best Bid and Offer (``NBBO'') 
ascertained from the market snapshot taken pursuant to paragraph (b) 
above or (2) 20,000 shares with no minimum aggregate notional value 
requirement; provided, however, Berkshire Hathaway, Inc. (BRK-A) will 
be a flat 100 shares minimum PES, due to its extraordinary share price.
    Proposed paragraph (c) places conditions on Exchange-initiated SNAP 
that are virtually identical to conditions for a valid Start SNAP order 
under current Article 1, Rule 2(h)(1). Similar to current Article 1, 
Rule 2(h)(1)(A)(iii), proposed paragraph (c)(1) provides that the 
Exchange shall not initiate a SNAP Cycle within five minutes of the 
first two-sided quote in the subject security having been received by 
the Exchange from the primary market disseminated after either the 
beginning of the regular trading session or a trading halt, pause or 
suspension that required the Exchange to suspend trading in the subject 
security; within five minutes of the end of the regular trading 
session; during a SNAP Cycle; or within one minute after the completion 
of the previous SNAP Cycle. Also, similar to Article 1, Rule 
2(h)(1)(A)(iv), proposed paragraph (c)(2) provides that the Exchange 
shall not initiate a SNAP Cycle if the CHX Routing Services, as 
described under Article 19, are not available at the time of the market 
snapshot taken pursuant to be proposed paragraph (b) above. Finally, 
similar to current Article 1, Rule 2(h)(1)(A)(ii), proposed paragraph 
(c)(3) provides that the Exchange shall not initiate a SNAP Cycle if 
the National Best Bid and Offer (``NBBO'') ascertained from the market 
snapshot taken pursuant to proposed paragraph (b) is crossed or a two-
sided NBBO does not exist.
    Incidentally, the Exchange proposes to amend current CHX Article 1, 
Rule 2(h)(1)(A)(iii) to replace a reference to ``trading halt or 
pause'' with the more accurate, ``trading halt, pause or suspension,'' 
as the Exchange had updated the CHX Rules previously to adopt this term 
change elsewhere in the CHX Rules.\25\
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    \25\ See Securities Exchange Act No. 76262 (October 26, 2015), 
80 FR 67440 (November 2, 2015) (SR-CHX-2015-05); see also supra note 
3.
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Examples
    The following Examples 1 and 2 are illustrative of the proposed 
Exchange-initiated SNAP mechanism, but do not exhaustively depict every 
possible scenario. Moreover, the charts used herein are illustrative 
and do not necessarily depict the actual technical processes involved 
in sorting orders.
    Example 1: Precedent Orders. Assume that at 10:59:58 a.m. the NBBO 
for security XYZ is $99.99 x $100.01 and Protected Quotations of 
external markets in security XYZ are as follows:
     Protected Bid A at Exchange 1 displaying 500 shares at 
$99.99
     Protected Offer A at Exchange 2 displaying 1000 shares at 
$100.01.
    Assume also that the CHX book is empty, but that the Exchange 
receives the following orders in security XYZ at 10:59:59 a.m.:
     Buy Order A for 500 shares priced at $99.98/share marked 
Do Not Display.\26\
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    \26\ See CHX Article 1, Rule 2
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     Buy Order B for 500 shares priced at $100.01/share marked 
SNAP AOO--Day.
     Buy Order C for 1,000 shares marked SNAP AOO--Day and SNAP 
AOO--Pegged--Midpoint.
     Sell Order A for 3,000 shares priced at $99.98/share 
marked SNAP AOO--Day.
    Under this Example 1, Buy Order A would be immediately posted to 
the CHX book and ranked in the CHX book pursuant to current Article 20, 
Rule 8(b)(1)(A)-(C), whereas Buy Orders B and C and Sell Order A would 
be placed in the SNAP AOO Queue, pursuant to Article 20, Rule 
8(b)(2)(A), and not immediately ranked, as SNAP AOOs are never active 
during the Open Trading State.
    Example 2: Pro forma SNAP review. Assume the same as Example 1. 
Assume also that at 11:00:00 a.m., the Exchange conducts a pro forma 
SNAP review of security XYZ and that the NBBO, CHX book and SNAP AOO 
Queue for security XYZ has not changed.
    Under this Example 2, pursuant to proposed Article 18, Rule 1A(b), 
the Exchange would take a market snapshot of the Protected Quotations 
of external markets in security XYZ and then create a pro forma SNAP 
CHX book based on the contents of the CHX book (i.e., Buy Order A), 
SNAP AOO Queue (i.e., Buy Orders B and C and Sell Order A) and the 
Protected Quotations of external markets (i.e., Protected Bid A and 
Protected Offer A). Thus, the pro forma SNAP CHX book in security XYZ 
would be as follows:

[[Page 13860]]

                                                           Pro Forma SNAP CHX Book--Example 2
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                               Buy orders                                                                                 Sell orders
-------------------------------------------------------------------------                            ---------------------------------------------------
                                                 Total buy    Total buy                                Total sell   Total sell   Total CHX    Total away
   Total away buy size at price     Total CHX   size better  size at and          Price point         size at and  size better   sell size    sell size
              point                buy size at   than price  better than                              better than   than price    at price     at price
                                   price point     point     price point                              price point     point        point        point
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0................................            0            0            0  100.02....................         4000         4000            0            0
0................................          500            0          500  100.01....................         4000         3000            0         1000
0................................         1000          500         1500  100.00 (Midpoint).........         3000         3000            0            0
500..............................            0         1500         2000  99.99.....................         3000         3000            0            0
0................................          500         2000         2500  99.98.....................         3000            0         3000            0
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    Based on this pro forma SNAP CHX book, the Matching System would 
calculate a pro forma SNAP Price, pursuant to proposed Article 18, Rule 
1A(b). Pursuant to current Article 1, Rule 1(rr), the SNAP Price is a 
single price at which the greatest number of shares may be executed 
during a SNAP Cycle, which would not trade-through any more 
aggressively priced orders on either side of the market. Under this 
Example 2, the pro forma SNAP Price would be $99.98 with a PES of 2500 
shares.
    Pursuant to proposed Article 18, Rule 1A(b)(1), the Exchange would 
then determine if the PES at the pro forma SNAP Price is equal to or 
greater than the corresponding minimum PES, as described under proposed 
Article 18, Rule 1A(d). Since the PES is 2,500 shares and the NBBO 
midpoint is $100.00, the aggregate notional value for this PES would be 
$250,000, which meets the minimum PES requirement of 2,500 shares and 
an aggregate notional value of $250,000.
    Pursuant to proposed Article 18, Rule 1A(b)(2), the Exchange would 
also determine whether the PES within the Matching System at the pro 
forma SNAP Price is at least 80% of the minimum PES. Since the PES 
within the Matching System of 2,000 shares (i.e., 2,500 total PES-500 
away PES = 2,000) is exactly 80% of the corresponding minimum PES of 
2,500, this requirement is met.
    Thus, the Exchange would initiate a SNAP Cycle in security XYZ and 
conduct the SNAP Cycle pursuant to current Article 18, Rule 1(b).
Operative Date
    In the event the proposed rule change is approved by the SEC, the 
Exchange proposes to make the proposed rule change operative pursuant 
to one week notice by the Exchange to its Participants. Prior to the 
operative date, the Exchange will ensure that policies and procedures 
are in place to allow Exchange operations personnel to effectively 
monitor the operation of the proposed Exchange-initiated SNAP 
mechanism.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act in general,\27\ and furthers the 
objectives of Section 6(b)(5) in particular,\28\ in that it is designed 
to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in facilitating 
transactions in securities, to remove impediments and perfect the 
mechanisms of a free and open market, and, in general, to protect 
investors and the public interest.
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    \27\ 15 U.S.C. 78f(b).
    \28\ 15 U.S.C. 78f(b)(5).
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    In addition to the reasons stated under the original SNAP rule 
filing,\29\ the Exchange believes that proposed Exchange-initiated SNAP 
mechanism will promote just and equitable principles of trade because 
it will promote bulk executions resulting from, among other things, 
SNAP AOOs that may remain unexecuted if the Exchange were not to 
receive a valid Start SNAP order that would trigger a SNAP Cycle. The 
Exchange believes that promoting such bulk executions will enhance 
market liquidity and the price discovery process for all securities, 
which protects investors and the public interest.
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    \29\ See supra note 3.
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    Also, the Exchange believes that the proposed rule change would 
promote just and equitable principles because the proposed Exchange-
initiated SNAP mechanism will further minimize any information leakage 
that would result from SNAP executions. Currently, SNAP Cycles could 
only be initiated upon receipt of a valid Start SNAP order, which must 
meet certain size and pricing requirements. However, with the adoption 
of the proposed Exchange-initiated SNAP mechanism, SNAP executions may 
result even without receipt of a Start SNAP order. Thus, the proposed 
rule change will further minimize any information leakage from SNAP 
executions, as a market participant will not be able to discern with 
certainty which initiating mechanism triggered a given SNAP Cycle. 
Under either initiation scenario, market participants would continue to 
know that resting liquidity of a substantial size exists at the 
Exchange when a SNAP Cycle is initiated.
    Moreover, the Exchange believes the proposed rule change furthers 
the objectives of Section 6(b)(1) \30\ in that the proposed amendment 
to current Article 1, Rule 2(h)(1)(A)(iii) to replace a reference to 
``trading halt or pause'' with ``trading halt, pause or suspension'' 
would result in consistent references to ``trading halt, pause or 
suspension'' throughout the CHX Rules, which would further enable the 
Exchange to be so organized as to have the capacity to be able to carry 
out the purposes of the Act and to comply, and to enforce compliance by 
its Participants and persons associated with its Participants, with the 
provisions of the Act, the rules and regulations thereunder, and the 
rules of the Exchange.
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    \30\ 15 U.S.C. 78f(b)(1).
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    The Exchange notes that the proposed rule change does not implicate 
Regulation NMS or Regulation SHO considerations as the proposed 
Exchange-initiated SNAP mechanism is based on a pro forma SNAP review 
that does not involve displaying, executing or routing any orders. If 
the pro forma SNAP review were to trigger a SNAP Cycle, the SNAP Cycle 
would be conducted in compliance with Regulation NMS and Rule 201 of 
Regulation SHO, as described under current CHX rules and applicable 
exemptive relief.\31\
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    \31\ See supra note 3; see also Letter from Josephine Tao, 
Assistant Director, Securities and Exchange Commission (the 
``Commission'' or ``SEC''), Division of Trading and Markets, to 
Albert J. Kim, Vice President and Associate General Counsel, CHX, 
dated October 6, 2015.
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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 that is not necessary or appropriate 
in furtherance of the purposes of the Act. To the contrary, the 
Exchange believes that any

[[Page 13861]]

burden on competition is necessary and appropriate in furtherance of 
the purposes of Section 6(b)(5) of the Act because it enhances and 
promotes the frequency of SNAP Cycles, which is a functionality that 
seeks to deemphasize speed as a key to trading success in order to 
further serve the interests of investors, as recently noted by Chair 
White, and thereby removes impediments and perfects the mechanisms of a 
free and open market.\32\
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    \32\ See Mary Jo White, Chair, Securities and Exchange 
Commission, Speech at Sandler O'Neil & Partners L.P. Global Exchange 
and Brokerage Conference (June 5, 2014).
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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 solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the Exchange consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be 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-CHX-2016-01 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-CHX-2016-01. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549 on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange and 
on its Internet Web site at www.chx.com. 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-CHX-2016-01, and should be submitted on 
or before April 5, 2016.
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    \33\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\33\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-05752 Filed 3-14-16; 8:45 am]
 BILLING CODE 8011-01-P