[Federal Register Volume 76, Number 216 (Tuesday, November 8, 2011)]
[Notices]
[Pages 69311-69313]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-28831]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-65669; File No. SR-NYSEArca-2011-78]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Offering a Market 
Data Product to Vendors and Subscribers That Combines Three Existing 
Market Data Feeds as Well as Additional Market Data From the Exchange 
Into One Integrated Product, the NYSE Arca Integrated Data Feed

November 2, 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 October 26, 2011, NYSE Arca, Inc. (``NYSEArca'' or the ``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.
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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 the 
Substance of the Proposed Rule Change

    The Exchange proposes to offer a market data product to vendors and 
subscribers that combines three existing market data feeds as well as 
additional market data from the Exchange into one integrated product, 
the NYSE Arca Integrated Data Feed. The text of the proposed rule 
change is available at the Exchange, the Commission's Public Reference 
Room, and http://www.nyse.com.

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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to offer a market data product to vendors and 
subscribers that combines three existing market data feeds as well as 
additional market data from the Exchange into one integrated product, 
the NYSE Arca Integrated Data Feed. The three existing products, which 
were previously approved by the Securities and Exchange Commission (the 
``Commission'') [sic] directly or became effective pursuant to Section 
19(b)(3)(A), are: (1) NYSE Arca BBO,\3\ a service that makes available 
the Exchange's best bids and offers; (2) NYSE Arca Trades,\4\ a service 
that makes available NYSE Arca last sale information on a real-time 
basis; and (3)

[[Page 69312]]

ArcaBook,\5\ a compilation of all limit orders resident in the NYSE 
Arca limit order book. In addition, the NYSE Arca Integrated Data Feed 
would include the following types of market data, which are currently 
available through existing market data products: order imbalance 
information prior to the opening and closing of trading \6\ and 
security status information (i.e., delayed openings and trading 
halts).\7\
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    \3\ See Securities Exchange Act Release No. 62188 (May 27, 
2010), 75 FR 31484 (June 3, 2010) (SR-NYSEArca-2010-23).
    \4\ See Securities Exchange Act Release No. 59598 (March 18, 
2009), 74 FR 12919 (March 29, 2009) (SR-NYSEArca-2009-05).
    \5\ See Securities Exchange Act Release No. 63291 (November 9, 
2010), 75 FR 70311 (November 17, 2010).
    \6\ The Exchange's affiliates, the New York Stock Exchange, LLC 
(``NYSE'') and NYSE Amex, LLC, currently offer imbalance data feed 
products pursuant to proposed rule changes filed with the 
Commission. See Securities Exchange Act Release No. 60153 (June 19, 
2009), 74 FR 30656 (June 26, 2009) (SR-NYSE-2009-49) (order 
approving proposed rule change) [sic]; and Securities Exchange Act 
Release No. 60151 (June 19, 2009), 74 FR 30653 (June 26, 2009) (SR-
NYSEAmex-2009-29).
    \7\ The Commission previously approved the NYSE Alerts data feed 
for NYSE, which includes delayed opening and trading halt data. See 
Securities Exchange Act Release No. 50844 (December 13, 2004), 69 FR 
76806 (December 22, 2004) (SR-NYSE-2004-53).
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    The Exchange proposes to offer the NYSE Arca Integrated Data Feed 
through the Exchange's Liquidity Center Network (``LCN''), a local area 
network in the Exchange's Mahwah, New Jersey data center that is 
available to Users of the Exchange's co-location services. The Exchange 
also would offer the NYSE Arca Integrated Data Feed through the 
Exchange's Secure Financial Transaction Infrastructure (``SFTI'') 
network, through which all other Users and member organizations access 
the Exchange's trading and execution systems and other proprietary 
market data products.
    Offering an integrated product addresses requests received from 
vendors and subscribers that would like to receive the data described 
above in an integrated fashion. An integrated data feed would provide a 
lower latency solution to those vendors and subscribers that are 
interested in receiving market data as quickly as possible. In 
addition, an integrated data feed would provide greater efficiencies 
and reduce errors for vendors and subscribers that currently choose to 
integrate the data after receiving it from the Exchange. The Exchange 
believes that providing vendors and subscribers with the option of a 
market data product that both integrates existing products and includes 
additional market data would allow vendors and subscribers to choose 
the best solution for their specific businesses.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) \8\ of the 
Securities Exchange Act of 1934 (the ``Act''), in general, and furthers 
the objectives of Section 6(b)(5),\9\ in particular, in that it is 
designed to prevent fraudulent and manipulative acts and practices, 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, and it is not designed to 
permit unfair discrimination among customers, brokers, or dealers.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
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    In adopting Regulation NMS, the Commission granted self-regulatory 
organizations (``SROs'') and broker-dealers increased authority and 
flexibility to offer new and unique market data to consumers of such 
data. It was believed that this authority would expand the amount of 
data available to users and consumers of such data and also spur 
innovation and competition for the provision of market data. The 
Exchange believes that the NYSE Arca Integrated Data Feed is precisely 
the sort of market data product that the Commission envisioned when it 
adopted Regulation NMS. The Commission concluded that Regulation NMS--
by lessening regulation of the market in proprietary data--would itself 
further the Act's goals of facilitating efficiency and competition:
    Efficiency is promoted when broker-dealers who do not need the data 
beyond the prices, sizes, market center identifications of the NBBO and 
consolidated last sale information are not required to receive (and pay 
for) such data. The Commission also believes that efficiency is 
promoted when broker-dealers may choose to receive (and pay for) 
additional market data based on their own internal analysis of the need 
for such data.\10\
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    \10\ Securities Exchange Act Release No. 51808 (June 9, 2005), 
70 FR 37496 (June 29, 2005).
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    The Exchange further notes that the existence of alternatives to 
the Exchange's product, including real-time consolidated data, free 
delayed consolidated data, and proprietary data from other sources, as 
well as the continued availability of the Exchange's separate data 
feeds, ensures that the Exchange is not unreasonably discriminatory 
because vendors and subscribers can elect these alternatives.
    The NYSE Arca Integrated Data Feed will help to protect a free and 
open market by providing additional data to the marketplace and give 
investors greater choices. In addition, the proposal would not permit 
unfair discrimination because the product will be available to all of 
the Exchange's customers and broker-dealers through both the LCN and 
SFTI.

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 market for proprietary 
data products is currently competitive and inherently contestable 
because there is fierce competition for the inputs necessary to the 
creation of proprietary data. Numerous exchanges compete with each 
other for listings, trades, and market data itself, providing virtually 
limitless opportunities for entrepreneurs who wish to produce and 
distribute their own market data. This proprietary data is produced by 
each individual exchange, as well as other entities (such as 
internalizing broker-dealers and various forms of alternative trading 
systems, including dark pools and electronic communication networks), 
in a vigorously competitive market. It is common for market 
participants to further and exploit this competition by sending their 
order flow and transaction reports to multiple markets, rather than 
providing them all to a single market.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \11\ and Rule 19b-4(f)(6) thereunder.\12\ 
Because the proposed rule change does not: (i) Significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of

[[Page 69313]]

investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
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    \11\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \12\ 17 CFR 240.19b-4(f)(6).
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    At any time within 60 days of the filing of such 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.

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 [email protected]. Please include 
File Number SR-NYSEArca-2011-78 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-NYSEArca-2011-78. 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 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 No. SR-NYSEArca-2011-78 and should be 
submitted on or before November 29, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2011-28831 Filed 11-7-11; 8:45 am]
BILLING CODE 8011-01-P