Document ID: SEC-2020-0109-0001
Agency: sec
Document Type: Notice
Title: Joint Industry Plan
Posted Date: 2020-01-28T05:00Z

[Federal Register Volume 85, Number 18 (Tuesday, January 28, 2020)]
[Notices]
[Pages 5062-5063]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-01453]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-88017; File No. S7-24-89]

Joint Industry Plan; Notice of Filing of the Forty-Fifth 
Amendment to the Joint Self-Regulatory Organization Plan Governing the 
Collection, Consolidation and Dissemination of Quotation and 
Transaction Information for Nasdaq-Listed Securities Traded on 
Exchanges on an Unlisted Trading Privileges Basis

January 23, 2020.
    Pursuant to Section 11A of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 608 thereunder,\2\ notice is hereby given that 
on September 11, 2019,\3\ the Participants \4\ in the Joint Self-
Regulatory Organization Plan Governing the Collection, Consolidation 
and Dissemination of Quotation and Transaction Information for Nasdaq-
Listed Securities Traded on Exchanges on an Unlisted Trading Privileges 
Basis (``Nasdaq/UTP Plan'' or ``Plan'') filed with the Securities and 
Exchange Commission (``Commission'') a proposal to amend the Nasdaq/UTP 
Plan.\5\ The amendment represents the 45th amendment to the Nasdaq/UTP 
Plan (``Amendment''). Under the Amendment, the Participants propose to 
amend the Plan to resolve textual inconsistencies in Plan provisions 
governing the reporting of last sale price reports in an Eligible 
Security \6\ by the Processor \7\ during a Regulatory Halt.\8\
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    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 242.608.
    \3\ See Letter from Robert Books, Chair, UTP Operating 
Committee, to Vanessa Countryman, Secretary, Commission, dated 
September 6, 2019.
    \4\ The Participants are: Cboe BYX Exchange, Inc.; Cboe BZX 
Exchange, Inc.; Cboe EDGA Exchange, Inc.; Cboe EDGX Exchange, Inc.; 
Cboe Exchange, Inc.; NYSE Chicago, Inc.; Financial Industry 
Regulatory Authority, Inc.; The Investors' Exchange LLC; Long-Term 
Stock Exchange, Inc.; Nasdaq BX, Inc.; Nasdaq ISE, LLC; Nasdaq PHLX, 
Inc.; The Nasdaq Stock Market LLC; New York Stock Exchange LLC; NYSE 
American LLC; NYSE Arca, Inc.; and NYSE National, Inc. 
(collectively, the ``Participants'').
    \5\ The Plan governs the collection, processing, and 
dissemination on a consolidated basis of quotation information and 
transaction reports in Eligible Securities for its Participants. 
This consolidated information informs investors of the current 
quotation and recent trade prices of Nasdaq securities. It enables 
investors to ascertain from one data source the current prices in 
all the markets trading Nasdaq securities. The Plan serves as the 
required transaction reporting plan for its Participants, which is a 
prerequisite for their trading Eligible Securities. See Securities 
Exchange Act Release No. 55647 (April 19, 2007), 72 FR 20891 (April 
26, 2007).
    \6\ Section III.B of the Plan defines ``Eligible Security'' as 
``any Nasdaq Global Market or Nasdaq Capital Market security, as 
defined in NASDAQ Rule 4200. Eligible Securities under the UTP Plan 
does not include any security that is defined as an ``Eligible 
Security'' within Section VII of the Consolidated Tape Association 
Plan.''
    \7\ Section III.Q of the Plan defines the term ``Processor'' as 
``the entity selected by the Participants to perform the processing 
functions set forth in the Plan.''
    \8\ Section III.S of the Plan defines the term ``Regulatory 
Halt'' as a ``trade suspension or halt called for the purpose of 
dissemination of material news, as described in Section X of the 
Plan or that is called for where there are regulatory problems 
relating to an Eligible Security that should be clarified before 
trading therein is permitted to continue, including a trading halt 
for extraordinary market activity due to system misuse or 
malfunction under Section X.E. l of the Plan (`Extraordinary Market 
Regulatory Halt').''
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    The proposed Amendment has been filed by the Participants pursuant 
to Rule 608(b)(2) under Regulation NMS.\9\ The Commission is publishing 
this notice to solicit comments from interested persons on the proposed 
Amendment. Set forth in Sections I and II is the statement of the 
purpose and summary of the Amendment, along with the information 
required by Rules 608(a) and 601(a) under the Act, prepared and 
submitted by the Participants to the Commission.
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    \9\ 17 CFR 242.608(b)(2).
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I. Rule 608(a)

A. Purpose of the Amendment

    Section X of the Plan currently includes inconsistent language with 
respect to the Processor's ability to disseminate last sale price 
reports in an Eligible Security during a Regulatory Halt. Section X.A 
prohibits the Processor from including any last sale reports in an 
Eligible Security during a Regulatory Halt. Section X.C, however, 
includes language that specifically permits the Processor during a 
Regulatory Halt to ``collect and disseminate Transaction Information.''
    In practice, during a Regulatory Halt, the Processor has been 
following Section X.C and will immediately disseminate last sale price 
reports during a Regulatory Halt. The Participants believe that the 
Processor's current practice helps to reduce inefficiencies and 
confusion among market participants with respect to the operation of 
the Plan during a Regulatory Halt. As a result, the Participants have 
determined it appropriate to amend the language of the Plan to resolve 
the inconsistent language described above in order to confirm that the 
Processor may continue to disseminate last sale price reports during a 
Regulatory Halt. In addition, the Amendment would also align the Plan 
language with a corresponding Amendment being proposed by the CTA Plan.
    Further, the Participants believe that the Amendment would help 
avoid race conditions. By way of example, when a primary market 
initiates a Regulatory Halt, it sends notifications to the Processor 
and other Participants. A trade may occur at a Participant before that 
Participant receives notification of the Regulatory Halt and thereby 
reports the trade to the Processor after the Processor receives 
notification of the Regulatory Halt. The Participants believe it would 
be impractical for the Processor to determine that a transaction 
occurred either before or after a Participant received notification of 
a Regulatory Halt, and therefore whether to immediately disseminate or 
refrain from disseminating the trade report until permissible. 
Consequently, the Participants believe that it is appropriate to place 
the responsibility on the individual Participants to determine whether 
or not a transaction should be printed during a Regulatory Halt, and 
the Processor should simply act as a pass-through for the information 
that it receives from the Participants. Therefore, the Amendment will 
permit the Processor to continue to disseminate any last sale price 
reports received during a Regulatory Halt, without reference to the 
specific race condition identified above.

B. Governing or Constituent Documents

    Not applicable.

C. Implementation of Amendment

    Each of the Participants has approved the Amendment in accordance 
with Section IV.C of the UTP Plan. The Participants also received 
feedback from the Advisory Committee on amending the Plan to resolve 
ambiguous language in the Plan to confirm that the Processor may 
disseminate last sale price reports and align the Plan with the 
corresponding Amendment proposed by the CTA Plan.

D. Development and Implementation Phases

    Not applicable.

E. Analysis of Impact on Competition

    The Participants believe that the proposed Amendment do not impose 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Securities Exchange Act of 1934, as 
amended. The Participants believe that amending the Plan to resolve 
inconsistent language

[[Page 5063]]

with respect to dissemination of information by the Processor during 
Regulatory Halts reduces inefficiencies and confusion among market 
participants with respect to the operation of the Plan during a 
Regulatory Halt. Additionally, the Participants believe that the 
Amendment will serve to increase transparency in the marketplace by 
disseminating Transaction Reports closer in time to when such 
transactions actually occurred. The Participants also have approved a 
corresponding Amendment to the CTA Plan thereby aligning the operation 
of the Plan with the CTA Plan.

F. Written Understanding or Agreements Relating to Interpretation of, 
or Participation in, Plan

    Not applicable.

G. Approval by Sponsors in Accordance With Plan

    Section IV.C.l of the UTP Plan requires the Participants to 
unanimously approve the Amendment proposed herein. They so approved it.

H. Description of Operation of Facility Contemplated by the Proposed 
Amendment

    Not applicable.

I. Terms and Conditions of Access

    Not applicable.

J. Method of Determination and Imposition, and Amount of, Fees and 
Charges

    Not applicable.

K. Method and Frequency of Processor Evaluation

    Not applicable.

L. Dispute Resolution

    Not applicable.

II. Regulation NMS Rule 601(a) (Solely in Its Application to the 
Amendments to the UTP Plan)

A. Equity Securities for Which Transaction Reports Shall Be Required by 
the Plan

    Not applicable.

B. Reporting Requirements

    Not applicable.

C. Manner of Collecting, Processing, Sequencing, Making Available and 
Disseminating Last Sale Information

    The Amendment would resolve ambiguous Plan language to clarify that 
the Processor may continue to disseminate Transaction Reports of last 
sale prices for transactions received by the Processor during a 
Regulatory Halt.

D. Manner of Consolidation

    Not applicable.

E. Standards and Methods Ensuring Promptness, Accuracy and Completeness 
of Transaction Reports

    Not applicable.

F. Rules and Procedures Addressed to Fraudulent or Manipulative 
Dissemination

    Not applicable.

G. Terms of Access to Transaction Reports

    Not applicable.

H. Identification of Marketplace of Execution

    Not applicable.

III. Solicitation of Comments

    The Commission seeks general comments on the Amendment. Interested 
persons are invited to submit written data, views, and arguments 
concerning the foregoing, including whether the proposed Amendment 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 S7-24-89 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 S7-24-89. 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 website (http://www.sec.gov/rules/sro.shtml). Copies of 
the submission, all written statements with respect to the proposed 
Amendment that are filed with the Commission, and all written 
communications relating to the proposed Amendment 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 website 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 website viewing and printing at 
the principal office of the Plan. 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 S7-24-89 and should be 
submitted on or before February 18, 2020.

    By the Commission.

Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2020-01453 Filed 1-27-20; 8:45 am]
 BILLING CODE 8011-01-P