Document ID: SEC-2015-1303-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: BATS Exchange, Inc.
Posted Date: 2015-08-05T04:00Z

[Federal Register Volume 80, Number 150 (Wednesday, August 5, 2015)]
[Notices]
[Pages 46615-46617]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-19133]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75567; File No. SR-BATS-2015-54]

Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change to Delay 
Implementation of SR-BATS-2015-51

July 30, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on July 23, 2015, BATS Exchange, Inc. (the ``Exchange'' or 
``BATS'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule

[[Page 46616]]

change as described in Items I and II below, which Items have been 
prepared by the Exchange. The Exchange has designated this proposal as 
a ``non-controversial'' proposed rule change pursuant to Section 
19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(6)(iii) thereunder,\4\ 
which renders it effective upon filing with the Commission. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6)(iii).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange is proposing to delay the implementation date of 
recent amendments to Rules 21.1(d)(9), (h) and (i) that modified the 
operation of BATS Post Only Orders \5\ subject to the Price Adjust \6\ 
process on the Exchange's options platform (``BATS Options'').\7\ The 
text of the proposed rule change is available at the Exchange's Web 
site at www.batstrading.com, at the principal office of the Exchange, 
and at the Commission's Public Reference Room.
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    \5\ BATS Post Only Orders are orders that are to be ranked and 
executed on the Exchange pursuant to Rule 21.8 (Order Display and 
Book Processing) or cancelled, as appropriate, without routing away 
to another trading center. See Exchange Rule 21.1(d)(9).
    \6\ In sum, under the Price Adjust process, a BATS Post Only 
order that locks or crosses a Protected Quotation displayed by the 
Exchange upon entry will continue to be ranked and displayed by the 
System at one minimum price variation below the current NBO (for 
bids) or to one minimum price variation above the current NBB (for 
offers). See Exchange Rule 21.1(i).
    \7\ See Securities Exchange Act Release No. 75360 (July 6, 
2015), 80 FR 39816 (July 10, 2015) (SR-BATS-2015-51) (Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change to 
Modify the Operation of BATS Post Only Orders Subject to the Price 
Adjust Process on the Exchange's Options Platform).
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II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

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

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

1. Purpose
    The Exchange is proposing to delay the implementation date of 
recent amendments to Rules 21.1(d)(9), (h) and (i) that modified the 
operation of BATS Post Only Orders subject to the Price Adjust process 
on BATS Options so that they will no longer remove liquidity from the 
BATS Options Book \8\ pursuant to Rule 21.1(d)(9) where the value of 
price improvement associated with such execution equals or exceeds the 
sum of fees charged for such execution and the value of any rebate that 
would be provided if the order posted to the BATS Options Book and 
subsequently provided liquidity.\9\ The proposed rule change was filed 
with the Commission on June 30, 2015 for immediate effectiveness 
pursuant to Rule 19b-4(f)(6)(iii) under the Act,\10\ and therefore, is 
scheduled to become operative 30 days from the date on which it was 
filed. Accordingly, the proposed rule change is scheduled to become 
operative on July 30, 2015. The Exchange proposes to delay the 
implementation of the proposed rule change and will announce the exact 
date via a publicly disseminated trading notice, which will be issued 
at least two week prior to the implementation date.
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    \8\ ``BATS Options Book'' is defined as ``the electronic book of 
options orders maintained by the Trading System.'' See Exchange Rule 
16.1(a)(9).
    \9\ For a complete description of the proposed rule change, see 
supra note 7.
    \10\ 17 CFR 240.19b-4(f)(6)(iii).
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \11\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \12\ in particular, in that it is designed to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in facilitating transactions in 
securities, 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. Delaying the implementation 
date will provide the Exchange with additional time to implement and 
test the necessary modifications to its System,\13\ thereby promoting 
fair and orderly markets, as well as the protection of investors and 
the public interest.
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    \11\ 15 U.S.C. 78f(b).
    \12\ 15 U.S.C. 78f(b)(5).
    \13\ The term ``System'' is defined as ``the electronic 
communications and trading facility designated by the Board through 
which securities orders of Users are consolidated for ranking, 
execution and, when applicable, routing away.'' Rule 1.5(aa).
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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. The Exchange believes that 
the proposed delay of the implementation date will not have any impact 
on competition.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received from Members, Participants or Others

    The Exchange has neither solicited nor received written comments on 
the proposed rule change. The Exchange has not received any written 
comments from members or other interested parties.

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

    The Exchange has designated this rule filing as non-controversial 
under Section 19(b)(3)(A) of the Act \14\ and paragraph (f)(6) of Rule 
19b-4 thereunder.\15\ The proposed rule change effects a change that 
(A) does not significantly affect the protection of investors or the 
public interest; (B) does not impose any significant burden on 
competition; and (C) by its terms, does not become operative for 30 
days after the date of the filing, or such shorter time as the 
Commission may designate if consistent with the protection of investors 
and the public interest; provided that the self-regulatory organization 
has given 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, or such shorter time as designated 
by the Commission. The Exchange provided the Commission with 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 this filing.
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    \14\ 15 U.S.C. 78s(b)(3)(A).
    \15\ 17 CFR 240.19b-4.
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    A proposed rule change filed under Rule 19b-4(f)(6) \16\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant

[[Page 46617]]

to Rule 19b-4(f)(6)(iii), the Commission may designate a shorter time 
if such action is consistent with the protection of investors and the 
public interest. The Exchange has asked the Commission to waive the 30-
day operative delay so that BATS may implement the proposed rule change 
immediately. The Commission believes that waiving the 30-day operative 
delay is consistent with the protection of investors and the public 
interest as it will immediately notify members that the currently 
scheduled operative date for recent amendments to BATS Post Only Orders 
has changed from July 30, 2015.\17\ Therefore, the Commission hereby 
waives the 30-day operative delay and designates the proposed rule 
change to be operative upon filing with the Commission.\18\
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    \16\ 17 CFR 240.19b-4(f)(6).
    \17\ See supra note 7.
    \18\ For purposes only of waiving the operative delay for this 
proposal, the Commission has considered the proposed rule's impact 
on efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission may summarily temporarily suspend such rule 
change if it appears to the Commission that such action is: (1) 
Necessary or appropriate in the public interest; (2) for the protection 
of investors; or (3) 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-BATS-2015-54 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-BATS-2015-54. 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 offices 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-BATS-2015-54, 
and should be submitted on or before August 26, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\19\
Robert W. Errett,
Deputy Secretary.
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    \19\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 2015-19133 Filed 8-4-15; 8:45 am]
 BILLING CODE 8011-01-P