[Federal Register Volume 80, Number 6 (Friday, January 9, 2015)]
[Notices]
[Pages 1453-1455]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-00136]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-73990; File No. SR-EDGA-2014-35]


Self-Regulatory Organizations; EDGA Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Adopt 
Top and Last Sale Data Feeds

January 5, 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 December 24, 2014, EDGA Exchange, Inc. (the ``Exchange'' or the 
``EDGA'') 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 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\ 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 filed a proposed rule change to amend Rule 13.8 to 
establish two new market data products know as: (i) EDGA TOP; and (ii) 
EDGA Last Sale. The proposed market data products are identical to the 
existing Top and Last Sale data feeds available on the BATS Exchange, 
Inc. (``BZX'') and the BATS Y-Exchange, Inc. (``BYX'', collectively 
with BZX, ``BATS'').\5\ The Exchange also proposes to amend Rule 
13.8(a) to rename the EDGA Book Feed as the EDGA Depth and align with 
system functionality currently available on BATS.
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    \5\ See BATS Rule 11.22(d) and (g).
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    The text of the proposed rule change is available at the Exchange's 
Web site at http://www.directedge.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 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
    Earlier this year, the Exchange and its affiliate, EDGX Exchange, 
Inc. (``EDGX'') received approval to effect a merger (the ``Merger'') 
of the Exchange's parent company, Direct Edge Holdings LLC, with BATS 
Global Markets, Inc., the parent of BZX and BYX (together with BYX, 
BZX, EDGA and EDGX, the ``BGM Affiliated Exchanges'' or ``BATS 
Exchange'').\6\ In the context of the Merger, the BGM Affiliated 
Exchanges are working to migrate EDGX and EDGA onto the BATS technology 
platform, and align certain system functionality, retaining only 
intended differences between the BGM Affiliated Exchanges. As a result 
of these efforts, the Exchange proposes to establish two new market 
data products know as: (i) EDGA TOP; and (ii) EDGA Last Sale. The 
proposed market data products are identical to the existing Top and 
Last Sale data feeds available on BATS.\7\ The Exchange also proposes 
to amend Rule 13.8(a) to rename the EDGA Book Feed as the EDGA Depth 
and to align with system functionality currently available on BATS.
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    \6\ See Securities Exchange Act Release No. 71449 (January 30, 
2014), 79 FR 6961 (February 5, 2014) (SR-EDGX-2013-43; SR-EDGA-2013-
34).
    \7\ See supra note 5.
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EDGA Top and EDGA Last Sale
    The Exchange is proposing to offer two new data feeds that are 
identical to data feeds currently available on BATS: (i) EDGA Last 
Sale; and (ii) EDGA Top. EDGA Last Sale will provide real-time, 
intraday trade information, including price, volume and time of 
executions based on orders entered into the

[[Page 1454]]

System.\8\ EDGA Last Sale will not include quotation information. EDGA 
Top will include top of book quotations and last sale execution 
information based on orders entered into the System. The quotations 
made available via EDGA Top provide an aggregated size and do not 
indicate the size or number of individual orders at the best bid or 
ask. With regard to cost, the Exchange will file a separate rule filing 
with the Commission to establish fees for both EDGA Last Sale and EDGA 
Top.
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    \8\ 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.'' See Exchange Rule 
1.5(cc).
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    Various data recipients may wish to subscribe to and use EDGA Last 
Sale or EDGA Top. For instance, data recipients that provide real-time 
market information on public Web sites or offer dynamic stock tickers, 
portfolio trackers, price/time graphs and other visual systems can use 
EDGA Last Sale or EDGA Top in lieu of using the Exchange's existing 
data feeds. Such data recipients may prefer EDGA Last Sale or EDGA Top 
because the Exchange's existing data feeds contain a significant amount 
of additional information that such data recipients may not need, which 
may result in unnecessary technology costs (e.g., development, 
telecommunications or storage costs).
    Market participants can gain access to EDGA last sale prices and 
top of book quotations that are integrated with the prices that other 
markets make available through the Securities Information Processors 
(``SIP''). Therefore, no market participant is required to subscribe to 
EDGA Last Sale or EDGA Top because the same top of book quotations and 
last sale prices are available elsewhere and in the Exchange's other 
data products.\9\ The Exchange represents that it will not distribute 
the proposed feeds on a more timely basis than it makes available the 
data that is provided to the SIPs for consolidation and dissemination.
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    \9\ See Exchange Rule 13.8(a) and (b).
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EDGA Book Feed, Rule 13.8(a)
    Rule 13.8(a) describes the Exchanges depth of book data feed known 
as the EDGA Book Feed as a data feed that contains all displayed orders 
for listed securities trading on EDGA, order executions, order 
cancellations, order modifications, order identification numbers, and 
administrative messages. First, the Exchange proposes to rename the 
EDGA Book Feed as EDGA Depth, as it believes this name more accurately 
describes the book feed and aligns with the naming conventions proposed 
above for EDGA Top and EDGA Last Sale.
    Second, the Exchange proposes to amend Rule 13.8(a)(i) align with 
system functionality currently available on BATS. Under Rule 
13.8(a)(1), Members \10\ may obfuscate their unique order 
identification numbers on EDGA Depth per Market Participant Identifier 
for all logical ports or specific logical ports for subsequent 
replenishments of an order with a Reserve Quantity,\11\ as designated 
by the Member. In order to do so, the Member must contact the 
Exchange's Member Services (``Member Services'') department. In such 
case, a randomly generated order identification number would be applied 
the next trading day by the Exchange for all subsequent replenishments 
of orders with a Reserve Quantity until further instructions are 
received by Member Services from the Member.
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    \10\ The term ``Member'' is defined as ``any registered broker 
or dealer, or any person associated with a registered broker or 
dealer, that has been admitted to membership in the Exchange. A 
Member will have the status of a ``member'' of the Exchange as that 
term is defined in section 3(a)(3) of the Act.'' See Exchange Rule 
1.5(n).
    \11\ The term ``Reserve Quantity'' is defined as ``[t]he portion 
of an order that includes a Non-Displayed instruction in which a 
portion of that order is also displayed on the EDGA Book. Both the 
portion of the order with a Displayed instruction and the Reserve 
Quantity are available for execution against incoming orders.'' See 
Exchange Rule 11.6(m).
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    As amended, Rule 13.8(a)(i) would state that, unless otherwise 
instructed by the Member, the Exchange will obfuscate the Member's 
unique order identification number on EDGA Depth for each replenishment 
of an order with a Reserve Quantity. In order to opt out of the 
Exchange's obfuscation functionality, the Member must contact the 
Exchange's Trade Desk. As a result, Members will no longer be required 
to elect obfuscation of their order identification numbers on EDGA 
Depth. Rather, Members must instruct the Exchange when they chose to 
not have their order identification number obfuscated and displayed on 
EDGA Depth.
Implementation Date
    The Exchange intends to implement the proposed rule change on or 
about January 12, 2015, which is the anticipated date upon which the 
migration of the Exchange to the BATS technology platform will be 
complete and the proposed data feeds may be made available.
2. Statutory Basis
    The Exchange believes that the proposed rule changes are consistent 
with section 6(b) of the Act \12\ and further the objectives of section 
6(b)(5) of the Act \13\ because they are designed 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, to 
foster cooperation and coordination with persons engaged in 
facilitating transactions in securities, and, in general, to protect 
investors and the public interest. The Exchange also believes this 
proposal is consistent with section 6(b)(5) of the Act \14\ because it 
protects investors and the public interest and promotes just and 
equitable principles of trade by providing investors with new options 
for receiving market data. The proposed rule change also is designed to 
support the principles of section 11A(a)(1) \15\ of the Act in that it 
seeks to assure fair competition among brokers and dealers and among 
exchange markets.
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    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(5).
    \14\ Id.
    \15\ 15 U.S.C. 78k-1(a)(1).
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    The proposed rule change would benefit investors by facilitating 
their prompt access to last sale information and best-bid-and-offer 
information contained in EDGA Last Sale and EDGA Top. The Exchange 
believe adding EDGA Last Sale and EDGA Top as well as the amendments to 
Rule 13.8(a)(i) would align the Exchange data feed offerings and 
functionality with that available on BATS upon migration of the 
Exchange to the BATS technology platform. Consistent technology 
offering identical market data products by each of the BGM Affiliated 
Exchange will, in turn, avoid investor confusion as well as simplify 
the technology implementation, changes and maintenance by Users of the 
Exchange that are also participants on BATS. The proposed rule change 
would provide greater harmonization between the rules of the BGM 
Affiliated Exchanges, resulting in greater uniformity and less 
burdensome and more efficient regulatory compliance. The proposed 
market data products are identical to the existing Top and Last Sale 
data feeds available on BATS.\16\ The proposed amendments to Rule 
13.8(a)(i) are also consistent with system functionality currently 
available on BATS. As such, the proposed rule change would foster 
cooperation and coordination with persons engaged in facilitating 
transactions in securities and would remove impediments to and perfect 
the

[[Page 1455]]

mechanism of a free and open market and a national market system.
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    \16\ See supra note 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 
result in any burden on competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. The Exchange 
reiterates that the proposed rule change is being proposed in the 
context of the technology integration of the BGM Affiliated Exchanges. 
Thus, the Exchange believes this proposed rule change is necessary to 
permit fair competition among national securities exchanges. In 
addition, the Exchange believes the proposed rule change will benefit 
Exchange participants in that it is one of several changes necessary to 
achieve a consistent technology offering by the BGM Affiliated 
Exchanges.

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.

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

    Because the foregoing 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 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 \17\ and Rule 19b-
4(f)(6) thereunder.\18\
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    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give 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 has satisfied this requirement.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \19\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \20\ permits the 
Commission to 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 in order 
to permit the Exchange to implement the proposed rule change on January 
12, 2015, which is the anticipated date upon which the migration of 
EDGA and EDGX to the BATS technology platform will be complete. The 
Exchange states that waiver of the operative delay is consistent with 
the protection of investors and the public interest because it will 
allow the Exchange to provide identical data products across the BGM 
Affiliated Exchanges upon migration of the Exchange to the BATS 
technology platform, thereby simplifying the technology integration for 
Members of the Exchange that are also participants on EDGX, EDGA, and 
BYX. In this regard, the Exchange notes that, since completion of the 
Merger, both Members and the BGM Affiliated Exchanges have made 
numerous systems changes in preparation for the technology migration 
occurring on January 12, 2015, the Exchange has issued frequent updates 
to Members informing them of the BGM Affiliated Exchange technology 
migration as well as its anticipated time line so that Members may make 
the requisite system changes. The Commission believes that waiving the 
30-day operative delay is consistent with the protection of investors 
and the public interest. Therefore, the Commission hereby waives the 
operative delay and designates the proposed rule change operative upon 
filing.\21\
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    \19\ 17 CFR 240.19b-4(f)(6).
    \20\ 17 CFR 240.19b-4(f)(6)(iii).
    \21\ 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. 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 [email protected]. Please include 
File Number SR-EDGA-2014-35 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 SR-EDGA-2014-35. 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 inspection and copying at the principal office of EDGA. 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-2014-35 and should be 
submitted on or before January 30, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\22\
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    \22\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-00136 Filed 1-8-15; 8:45 am]
BILLING CODE 8011-01-P