[Federal Register Volume 82, Number 129 (Friday, July 7, 2017)]
[Notices]
[Pages 31642-31644]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-14241]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81061; File No. SR-NYSEArca-2017-70]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Specify in 
Exchange Rules the Exchange's Primary and Secondary Sources of Data 
Feeds From NYSE MKT LLC

June 30, 2017.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the

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``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, 
on June 21, 2017, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE Arca'') 
filed with the Securities and Exchange Commission (the ``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 specify in Exchange rules the Exchange's 
primary and secondary sources of data feeds from NYSE MKT LLC for order 
handling and execution, order routing, and regulatory compliance. 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 NYSE Arca Equities Rule 7.37 (``Rule 
7.37'') to specify in Exchange rules the primary and secondary sources 
of data feeds from NYSE MKT LLC (``NYSE MKT'') that the Exchange would 
use for order handling and execution, order routing, and regulatory 
compliance.
    On July 18, 2014, the Exchange filed a proposed rule change that 
clarified the Exchange's use of certain data feeds for order handling 
and execution, order routing, and regulatory compliance.\4\ As noted in 
that filing, the data feeds available for the purposes of order 
handling and execution, order routing, and regulatory compliance at the 
Exchange include the exclusive securities information processor 
(``SIP'') data feeds \5\ or proprietary data feeds from individual 
market centers (``Direct Feed''). On February 24, 2015, the Exchange 
adopted Commentary .01 to Rule 7.37 to specify which data feeds that 
the Exchange uses for the handling, execution, and routing of orders, 
as well as for regulatory compliance.\6\ After implementation of 
Pillar, the Exchange's new trading technology system, Commentary .01 
was replaced by Rule 7.37(d).\7\
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    \4\ See Securities Exchange Act Release No. 72708 (July 29, 
2014), 79 FR 45572 (Aug. 5, 2014) (SR-NYSEArca-2014-82).
    \5\ The SIP feeds are disseminated pursuant to effective joint-
industry plans as required by Rule 603(b) of Regulation NMS. 17 CFR 
242.603(b). The three joint-industry plans are: (1) The CTA Plan, 
which is operated by the Consolidated Tape Association and 
disseminates transaction information for securities with the primary 
listing market on exchanges other than NASDAQ Stock Market LLC 
(``Nasdaq''); (2) the CQ Plan, which disseminates consolidated 
quotation information for securities with their primary listing on 
exchanges other than Nasdaq; and (3) the Nasdaq UTP Plan, which 
disseminates consolidated transaction and quotation information for 
securities with their primary listing on Nasdaq.
    \6\ See Securities Exchange Act Release No. 74409 (March 2, 
2015), 80 FR 12221 (March 6, 2015) (SR-NYSEArca-2015-11).
    \7\ See Securities Exchange Act Release No. 79078 (October 11, 
2016), 81 FR 71559 (October 17, 2016) (SR-NYSEArca-2016-135).
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    NYSE MKT has amended its rules to provide for an intentional access 
delay to certain inbound and outbound order messages on that exchange 
(the ``Delay Mechanism'').\8\ NYSE MKT will be implementing the Delay 
Mechanism when it transitions to the Pillar trading platform.\9\ The 
Delay Mechanism adds 350 microseconds of one-way latency to inbound and 
outbound communications, including all outbound communications to NYSE 
MKT's Direct Feeds.\10\ NYSE MKT will not apply the Delay Mechanism to 
outbound communications to the SIP.\11\ To use the lowest-latency 
source of information regarding NYSE MKT quotes and trades in Tape A 
and B securities, the Exchange proposes to amend Rule 7.37(d) to 
specify that the Exchange would use the SIP Data Feed as the primary 
source of data for all securities, including Tape C, from that market 
center, and would use the Direct Feed from NYSE MKT as the secondary 
source.
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    \8\ See NYSE MKT Rule 7.29E(b).
    \9\ Securities Exchange Act Release No. 80700 (May 16, 2017), 82 
FR 23381 (May 22, 2017) (SR-NYSEMKT-2017-05) (Approval Order).
    \10\ See NYSE MKT Rule 7.29E(b)(1)(E).
    \11\ See NYSE MKT Rule 7.29E(b)(2)(C).
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    The Exchange proposes to implement these changes coincident with 
the transition of NYSE MKT to the Pillar technology and with the 
implementation of the Delay Mechanism, which are expected to be on July 
24, 2017.\12\
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    \12\ See NYSE Group Pillar Migration Trader Update available at 
https://www.nyse.com/publicdocs/nyse/notifications/trader-update/Pillar%20Migration%20Update.pdf.
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    The Exchange also proposes non-substantive amendments to Rule 
7.37(d) to update the names of the market centers and to eliminate an 
inoperative market center.\13\
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    \13\ Specifically the Exchange proposes to update the names of 
Bats BYX Exchange, Inc. (formerly BATS Y-Exchange, Inc.), Bats BZX 
Exchange, Inc. (formerly BATS Exchange, Inc.), Bats EDGA Exchange, 
Inc. (formerly EDGA Exchange, Inc.), Bats EDGX Exchange, Inc. 
(formerly EDGX Exchange, Inc.), NASDAQ BX, Inc. (formerly NASDAQ OMX 
BX, Inc.) and NASDAQ PHLX LLC (formerly NASDAQ OMX PHLX, LLC). The 
Exchange also proposes to remove National Stock Exchange LLC, which 
is currently not operating and therefore the Exchange is not 
receiving any data feeds from that market center. See Securities 
Exchange Act Release No. 80018 (February 10, 2017), 82 FR 10947 
(February 16, 2017) (SR-NSX-2017-04).
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2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the 
Act,\14\ in general, and furthers the objectives of Section 
6(b)(5),\15\ in particular, because 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. The Exchange believes that the 
proposed rule change removes impediments to and perfects the mechanism 
of a free and open market because it would provide notice of which data 
feeds the Exchange uses for execution and routing decisions and for 
order handling and regulatory compliance, thus enhancing transparency.
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    \14\ 15 U.S.C. 78f(b).
    \15\ 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. The proposed change is not 
designed to address any competitive issue but rather would provide the 
public and investors with information about which data feeds the 
Exchange uses for execution

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and routing decisions and for order handling and regulatory compliance.

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: (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) \16\ of the Act and Rule 19b-
4(f)(6) thereunder.\17\
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    \16\ 15 U.S.C. 78s(b)(3)(A).
    \17\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
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 the 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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    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: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) 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-NYSEArca-2017-70 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-NYSEArca-2017-70. 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 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-2017-70, and should 
be submitted on or before July 28, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2017-14241 Filed 7-6-17; 8:45 am]
 BILLING CODE 8011-01-P