[Federal Register Volume 76, Number 56 (Wednesday, March 23, 2011)]
[Notices]
[Pages 16468-16469]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-6836]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-64094; File No. SR-EDGA-2011-07]
Self-Regulatory Organizations; Notice of Filing and Order
Granting Accelerated Approval of Proposed Rule Change by EDGA Exchange,
Inc. To Delete the Description of and All References to Step-Up Orders
in EDGA Rules
March 18, 2011.
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 March 10, 2011, EDGA Exchange, Inc. (``EDGA'' or ``Exchange'') filed
with the Securities and Exchange Commission (``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, and is approving the proposal on an accelerated basis.
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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 amend its Rules 11.5(c)(11) and Rule
11.9(b)(1)(C) to delete the description of and all references to Step-
Up orders. The text of the proposed rule change is attached as Exhibit
5 and is available on the Exchange's Web site at http://www.directedge.com, at the Exchange's principal office, and at the
Public Reference Room of the Commission.
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 self-regulatory organization 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
EDGA filed with the Securities and Exchange Commission
(``Commission'') a proposed rule change to amend EDGA Rule 11.9
regarding the description of the Step-up order type and modify how
Step-up orders would be processed pursuant to Exchange Rule 11.9.\3\
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\3\ See Securities Exchange Act Release No. 63335 (November 18,
2010, 75 FR71783. Amendment No. 2 replaced in its entirety the
original filing, SR-EDGA-2010-18 (November 8, 2010) and partial
Amendment No. 1 (November 23, 2010). See Securities Exchange Act
Release No. 63572 (December 17, 2010), 75 FR 80873.
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Exchange Rule 11.5(c)(11) defines a Step-up order as a ``market or
limit order with the instruction that the System display the order to
Users at or within the NBBO price pursuant to Rule 11.9(b)(1)(C).''
Exchange Rule 11.9(b)(1)(C), in turn, states that orders shall be
displayed to Users \4\ in a manner that is separately identifiable from
other Exchange orders, at or within the NBBO price for a period of time
not to exceed five hundred milliseconds, as determined by the Exchange.
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\4\ Exchange Rule 1.5(cc) defines a User as any ``any Member or
Sponsored Participant who is authorized to obtain access to the
System pursuant to Rule 11.3.''
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In light of the Commission's order instituting proceedings to
determine whether to disapprove the above-referenced proposed rule
change,\5\ the Exchange withdrew the filing mentioned above on February
25, 2011 and ceased offering the Step-up order as of the close of
business on February 28, 2011.
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\5\ See Securities Exchange Act Release No. 63929 (February 18,
2011), 76 FR10416 (SR-EDGA-2010-18).
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The Exchange now proposes to delete rules that reference Step-up
orders. Therefore, it is proposing to delete Rules 11.5(c)(11) and
11.9(b)(1)(C). As a result, conforming changes have been made to re-
number current Rules 11.5(c)(12)-(14) as Rules 11.5(c)(11)-(13). In
addition, a conforming change is proposed to re-number the reference to
Discretionary Orders, as set forth in Rule 11.8(a)(2)(C).
2. Statutory Basis
The statutory basis for the proposed rule change is Section 6(b)(5)
of the Act,\6\ which requires the rules of an exchange 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. Since
the Step-up order type was an enhanced functionality offered by the
Exchange not required under the Act, the Exchange would like to remove
references to it from its rulebook.
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\6\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received from Members, Participants or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
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 (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory
[[Page 16469]]
organization 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 e-mail to [email protected]. Please include
File Number SR-EDGA-2011-07 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-EDGA-2011-07. This file
number should be included on the subject line if e-mail 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 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 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 a.m. and 3
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-EDGA-2011-07 and should be submitted on
or before April 13, 2011.
V. Commission's Findings and Order Granting Accelerated Approval of a
Proposed Rule Change
After careful consideration, the Commission finds that the proposed
rule change is consistent with the requirements of the Act and the
rules and regulations thereunder applicable to a national securities
exchange.\7\ In particular, the Commission finds that the proposed rule
change is consistent with the requirements of Section 6(b)(5) of the
Act,\8\ which requires, among other things, that the Exchange's rules
be designed to promote just and equitable principles of trade, to
foster cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, to remove impediments to and
perfect the mechanism of a free and open market a national market
system, and in general, to protect investors and the public interest.
The Commission agrees with the Exchange that the Step-Up order type is
a functionality that is not required under the Act.\9\
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\7\ In approving the proposed rule change, the Commission notes
that it has considered the proposed rule's impact on efficiency,
competition, and capital formation. See 15 U.S.C. 78c(f).
\8\ 15 U.S.C. 78f(b)(5).
\9\ See supra Section II.A.2.
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The Commission finds good cause, pursuant to Section 19(b)(2) of
the Act,\10\ for approving the proposed rule change prior to the 30th
day after publication of notice in the Federal Register. Accelerated
approval will allow the Exchange to delete references to an order type
in its rules that is not required under the Act and that the Exchange
has determined to discontinue.
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\10\ 15 U.S.C. 78s(b)(2).
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VI. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the Act,
that the proposed rule change (SR-EDGA-2011-07) is hereby approved on
an accelerated basis.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-6836 Filed 3-22-11; 8:45 am]
BILLING CODE 8011-01-P