[Federal Register Volume 77, Number 117 (Monday, June 18, 2012)]
[Notices]
[Pages 36305-36307]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-14739]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-67178; File No. SR-NYSEArca-2012-60]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change Amending 
Commentary .07 to NYSE Arca Rule 6.4 Allowing the Exchange To Open 
Short Term Option Series That Are Opened by Other Securities Exchanges 
in Option Classes Selected by Other Exchanges Under Their Respective 
Short Term Option Rules

June 11, 2012.
    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 June 6, 2012, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE 
Arca'') 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 Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Commentary .07 to NYSE Arca Rule 6.4 
to allow the Exchange to open Short Term Option Series (``Weeklies'') 
that are opened by other securities exchanges in option classes 
selected by other exchanges under their respective short term option 
rules. The text of the proposed rule change is available on the 
Exchange's Web site at www.nyse.com, 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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this proposed rule change is to amend Commentary .07 
to NYSE Arca Rule 6.4 to allow the Exchange to open Short Term Option 
Series (``Weeklies'') that are opened by other securities exchanges in 
option classes selected by other exchanges under their respective short 
term option rules.\3\
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    \3\ On July 12, 2005, the Commission approved the Weeklies 
Program on a pilot basis. See Securities Exchange Act Release No. 
52013 (July 12, 2005), 70 FR 41471 (July 19, 2005) (SR-PCX-2005-32). 
The Weeklies Program was made permanent on June 23, 2010. See 
Securities Exchange Act Release No. 62369 (June 23, 2010), 75 FR 
37868 (June 30, 2010) (SR-NYSEArca-2010-59).
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    Currently, the Exchange may select up to 5 currently listed option 
classes on which Weeklies options may be opened in the Weeklies Program 
and the Exchange may also match any option classes that are selected by 
other securities exchanges that employ a similar program under their 
respective rules. For each option class eligible for participation in 
the Weeklies Program, the Exchange may open up to 30 Short Term Option 
Series for each expiration date in that class.
    This proposal seeks to allow the Exchange to open Weeklies option 
series that are opened by other securities exchanges in option classes 
selected by other exchanges under their respective short term option 
rules. This change is being proposed notwithstanding the current cap of 
30 series per class under the Weeklies Program. This is a competitive 
filing and is based on existing rules of The NASDAQ Stock Market LLC 
for the NASDAQ Options Market (``NOM'') and NASDAQ OMX PHLX, Inc. 
(``PHLX'') and Chicago Board Options Exchange, Incorporated 
(``CBOE'').\4\
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    \4\ See Securities Exchange Act Release Nos. 65775 (November 17, 
2011), 76 FR 72473 (November 23, 2011) (SR-NASDAQ-2011-138) ; 65776 
(November 17, 2011), 76 FR 72482 (November 23, 2011) (SR-PHLX-2011-
131); and 66563 (March 9, 2012), 77 FR 15426 (March 15, 2012).
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    NYSE Arca is competitively disadvantaged since it operates a 
substantially similar Weeklies Program as NOM, PHLX and CBOE but is 
limited to listing a maximum of 30 series per

[[Page 36306]]

options class that participates in its Weeklies Program (whereas PHLX, 
NOM and CBOE are not similarly restricted).
    The Exchange is not proposing any changes to the Weeklies Program 
other than the ability to open Weeklies option series that are opened 
by other securities exchanges in option classes selected by other 
exchanges under their respective short term option rules.
    The Exchange notes that the Weeklies Program has been well-received 
by market participants, in particular by retail investors. The Exchange 
believes that the current proposed revision to the Weeklies Program 
will permit the Exchange to meet increased customer demand and provide 
market participants with the ability to hedge in a greater number of 
option classes and series.
    With regard to the impact of this proposal on system capacity, the 
Exchange has analyzed its capacity and represents that it and the 
Options Price Reporting Authority (``OPRA'') have the necessary systems 
capacity to handle the potential additional traffic associated with 
trading of an expanded number of series for the classes that 
participate in the Weeklies Program.
    The proposed increase to the number of series per classes eligible 
to participate in the Weeklies Program is required for competitive 
purposes as well as to ensure consistency and uniformity among the 
competing options exchanges that have adopted similar Weeklies 
Programs.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the 
Securities Exchange Act of 1934 (the ``Act''),\5\ in general, and 
furthers the objectives of Section 6(b)(5),\6\ 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, and to remove impediments to and perfect 
the mechanism of a free and open market and a national market system. 
The Exchange believes that expanding the Weeklies Program will result 
in a continuing benefit to investors by giving them more flexibility to 
closely tailor their investment decisions and hedging decisions in a 
greater number of securities. The Exchange also believes that expanding 
the Weeklies Program will provide the investing public and other market 
participants with additional opportunities to hedge their investment 
thus allowing these investors to better manage their risk exposure. 
While the expansion of the Weeklies Program will generate additional 
quote traffic, the Exchange does not believe that this increased 
traffic will become unmanageable since the proposal remains limited to 
a fixed number of classes.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
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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.

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

    Because the foregoing proposed rule change does not significantly 
affect the protection of investors or the public interest, does not 
impose any significant burden on competition, and, by its terms, does 
not become operative for 30 days from the date on which it was filed, 
or such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \7\ and Rule 19b-
4(f)(6) thereunder.\8\
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the Exchange to give the Commission written notice of the 
Exchange's 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 has satisfied this requirement.
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    The Exchange has requested that the Commission waive the 30-day 
operative delay. The Commission believes that waiver of the operative 
delay is consistent with the protection of investors and the public 
interest because the proposal is substantially similar to those of 
other exchanges that have been approved by the Commission and permit 
such exchanges to open Weekly option series that are opened by other 
securities exchanges under their respective short term option rules.\9\ 
Therefore, the Commission designates the proposal operative upon 
filing.\10\
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    \9\ See supra note 4.
    \10\ For purposes only of waiving the 30-day operative delay, 
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 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-2012-60 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-2012-60. 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

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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-NYSEArca-2012-60 and should 
be submitted on or before July 9, 2012.

    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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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-14739 Filed 6-15-12; 8:45 am]
BILLING CODE 8011-01-P