[Federal Register Volume 80, Number 150 (Wednesday, August 5, 2015)]
[Notices]
[Pages 46642-46644]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-19129]



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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75559; File No. SR-NYSEMKT-2015-56]


Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of 
Proposed Rule Change Amending the NYSE MKT Trades Market Data Product 
Offering

July 30, 2015.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that, on July 24, 2015, NYSE MKT LLC (``Exchange'' or ``NYSE MKT'') 
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 self-regulatory organization. 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\ 15 U.S.C. 78a.
    \3\ 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 the NYSE MKT Trades market data 
product offering. 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the NYSE MKT Trades market data feed 
product offering.
    NYSE MKT Trades is an NYSE MKT-only last-sale market data feed. 
NYSE MKT Trades currently allows vendors, broker-dealers and others to 
make available on a real-time basis the same last sale information that 
the Exchange reports under the Consolidated Tape Association (``CTA'') 
Plan for inclusion in the CTA Plan's consolidated data streams. 
Specifically, the NYSE MKT Trades feed includes, for each security 
traded on the Exchange, the real-time last sale price, time and size 
information and bid/ask quotations and a stock summary message. The 
stock summary message updates every minute and includes NYSE MKT's 
opening price, high price, low price, closing price, and cumulative 
volume for the security.\4\
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    \4\ See Securities Exchange Act Release Nos. 62187 (May 27, 
2010), 75 FR 31500 (June 3, 2010) (SR-NYSEAmex-2010-35), 70065 (July 
30, 2013), 78 FR 47450 (Aug. 5, 2013) (SR-NYSEMKT-2013-64) and 69273 
(April 2, 2013), 78 FR 20969 (April 8, 2013) (SR-NYSEMKT-2013-30).
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    The Exchange has determined to modify the data content of NYSE MKT 
Trades to remove the bid/ask data and to provide the individual orders 
that make up each reported trade.
    First, as noted above, the NYSE MKT Trades data feed currently 
includes related bid/ask information at the time of each reported 
trade. The Exchange proposes to remove this limited bid/ask information 
from the NYSE MKT Trades feed, thereby focusing the NYSE MKT Trades 
feed on NYSE MKT last sale information. This change would streamline 
the NYSE MKT Trades content, as well as align NYSE MKT Trades content 
with that of last sale data feeds offered by other exchanges.\5\ The 
NYSE [sic] BBO data feed includes, and would continue to include, the 
best bids and offers for all securities that are traded on the Exchange 
for which NYSE [sic] reports quotes under the Consolidated Quotation 
(``CQ'') Plan for inclusion in the CQ Plan's consolidated quotation 
information data stream.\6\
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    \5\ See NASDAQ Rule 7039 (Nasdaq Last Sale) and BATS Rule 
11.22(g) (BATS Last Sale).
    \6\ See Securities Exchange Act Release No. 72326 (June 5, 
2014), 79 FR 33605 (June 11, 2014) (SR-NYSEMKT-2014-49).
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    Second, the Exchange currently reports to the CTA and distributes 
on a real-time basis via NYSE MKT Trades the real-time NYSE MKT last 
sale price information based on the completed trade of an arriving 
order. For example, if an arriving order of 1000 shares trades with 
five resting orders of 200 shares each, the Exchange reports a 
completed trade of 1000 shares. The Exchange proposes to distribute 
NYSE MKT last sale information in NYSE MKT Trades in a format that 
would be based on the individual resting orders that comprise the 
completed trade. In the example above, the Exchange would distribute 
via NYSE MKT Trades the real-time NYSE MKT last sale information of 
five executions of 200 shares each, with the same time stamp for each 
individual component of the trade. These five transactions would have 
the same time stamp and would comprise the same information that is 
being provided to the CTA regarding the completed trade, which would 
not change. The Exchange would continue to make NYSE MKT last sale 
information available through NYSE MKT Trades immediately after it 
provides last sale information to the processor under the CTA Plan.
    The Exchange expects to offer both the current NYSE MKT Trades data 
product and the proposed NYSE MKT Trades data product for a limited 
transition period. After the transition period, the Exchange would stop 
offering the current NYSE MKT Trades data product and offer only the 
NYSE MKT Trades data product proposed in this filing. The Exchange 
would announce the transition dates in advance. There would be no 
change to the fees for NYSE MKT Trades in connection with the proposed 
changes.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) \7\ of the 
Act, in general, and furthers the objectives of Section 6(b)(5) \8\ of 
the Act, 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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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that modifying the NYSE MKT Trades product to 
remove the bid/ask information it currently includes and to provide 
only NYSE MKT last sale information would streamline the product and 
clarify the purpose and use for each of the NYSE MKT proprietary market 
data products. The amended feed would also align NYSE MKT Trades' 
content with that of last sale data feeds offered by other exchanges, 
which similarly offer last sale market data products that do not 
include bid and offer information.\9\
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    \9\ See supra note 5.
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    The Exchange believes that modifying the NYSE MKT Trades product to 
report

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last-sale information based on trades of individual resting orders, 
rather than based on the completed trade of an arriving order at a 
price, would remove impediments to and perfect the mechanism of a free 
and open market by providing vendors and subscribers who desire it with 
more granular trade information, thus promoting competition and 
innovation. The Exchange would continue to report to the CTA the last 
sale prices that reflect a completed trade \10\ and the NYSE MKT Trades 
product would report the same volume and prices, but with more 
granularity regarding individual components of each completed trade. In 
adopting Regulation NMS, the Commission granted self-regulatory 
organizations 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 data product modifications proposed herein, by focusing the 
NYSE MKT Trades feed on last sale data by removing the bid/ask data, 
and by reporting last-sale information based on trades of resting 
orders, is precisely the sort of market data product enhancement that 
the Commission envisioned when it adopted Regulation NMS. The proposed 
changes are consistent with the requirements of the CTA Plan to provide 
the last sale prices reflecting completed transactions and with the 
principles embodied in Regulation NMS regarding the provision of market 
data by self-regulatory organizations to consumers of such data. The 
Commission concluded that Regulation NMS--by lessening regulation of 
the market in proprietary data--would itself further the Act's goals of 
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facilitating efficiency and competition:

    \10\ Pursuant to the CTA Plan, available here, https://www.ctaplan.com/publicdocs/ctaplan/notifications/plans/trader-update/5929.pdf, Participants to the CTA Plan are required to report 
``Last sale price information,'' which means ``(i) the last sale 
prices reflecting completed transaction in Eligible Securities, (ii) 
the volume and other information related to those transactions, 
(iii) the identifier of the Participant furnishing the prices and 
(iv) other related information.''
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    [E]fficiency 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.\11\
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    \11\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37496 (June 29, 2005) (File No. S7-10-04).
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    By removing ``unnecessary regulatory restrictions'' on the ability 
of exchanges to sell their own data, Regulation NMS advanced the goals 
of the Act and the principles reflected in its legislative history.
    The Exchange further notes that the existence of alternatives to 
the Exchange's products, including real-time consolidated data, free 
delayed consolidated data, and proprietary data from other sources, 
ensures that the Exchange is not unreasonably discriminatory because 
vendors and subscribers can elect these alternatives. In addition, the 
proposal would not permit unfair discrimination because the modified 
product would be available to all of the Exchange's vendors and 
customers on an equivalent basis.

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

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) by order approve or disapprove the 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 email to [email protected]. Please include 
File Number SR-NYSEMKT-2015-56 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-NYSEMKT-2015-56. 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 such filing will also 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-NYSEMKT-2015-56 and should 
be submitted on or before August 26, 2015.
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    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-19129 Filed 8-4-15; 8:45 am]
 BILLING CODE 8011-01-P