[Federal Register Volume 84, Number 220 (Thursday, November 14, 2019)]
[Notices]
[Pages 61958-61960]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-24692]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-87481; File No. SR-NYSE-2019-57]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend NYSE Rule 7.37 To Specify the Exchange's Use of Data Feeds from
NYSE Chicago, Inc.
November 6, 2019.
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 October 31, 2019, New York Stock Exchange LLC (``NYSE'' or
``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 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: (1) Amend Rule 7.37 to specify in
Exchange rules the Exchange's use of data feeds from NYSE Chicago, Inc.
(``NYSE Chicago'') for order handling and execution, order routing, and
regulatory compliance; and (2) amend Rule 17 to reflect that
Archipelago Securities LLC (``Arca Securities'') would function as a
routing broker for the Exchange's affiliate, NYSE Chicago. The proposed
rule change is available on the Exchange's website 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 update and amend the table in Rule 7.37
that sets forth on a market-by-market basis the specific network
processor and proprietary data feeds that the Exchange utilizes for the
handling, execution and routing of orders, and for performing the
regulatory compliance checks related to each of those functions.
Specifically, the table would be amended to include NYSE Chicago, which
intends to migrate to the Pillar trading platform.\4\ Rule 7.37
currenlty [sic] provides that the Chicago Stock Exchange, Inc., the
predecessor name of NYSE Chicago, utilizes the securities information
processor (``SIP'') data feed as its primary source for the handling,
execution and routing of orders, as well as for regulatory compliance,
and does not use a secondary source. Once NYSE Chicago transitions
trading to Pillar, it would use a direct data feed as its primary
source and the SIP data feed as a secondary source. To reflect these
changes, the Exchange proposes to amend Rule 7.37 to specify which data
feeds the Exchange would use for NYSE Chicago. Specifically, the
Exchange proposes to amend the rule to provide that NYSE Chicago would
use the direct data feed as the primary source and would use the SIP
data feed as a secondary source.
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\4\ NYSE Chicago has announced that, subject to rule approvals,
it will transition to trading on Pillar on November 4, 2019. See
Trader Update, available here: https://www.nyse.com/publicdocs/nyse/notifications/trader-update/NYSEChicago_Migration_update_9.4.pdf.
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Additionally, the Exchange proposes to amend Rule 17 to reflect
that Arca Securities would function as a routing broker for the
Exchange's affiliate, NYSE Chicago. Specifically, the Exchange proposes
to amend Rule 17(c)(2)(A) and (B) to reference NYSE Chicago as an
affiliate of the Exchange for the purposes of the inbound routing
function performed by Arca Securities. The proposed rule change would
provide more clarity and transparency to all the functions that Arca
Securities performs on behalf of the Exchange and its affiliates, which
now includes NYSE Chicago. The Exchange is not proposing any
substantive change to the rule.
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the
Securities Exchange Act of 1934 (the
[[Page 61959]]
``Act''),\5\ in general, and furthers the objectives of Section
6(b)(5),\6\ 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 its proposal to update the
table in Rule 7.37 to include NYSE Chicago will ensure that Rule 7.37
correctly identifies and publicly states on a market-by-market basis
all of the specific network processor and proprietary data feeds that
the Exchange utilizes for the handling, execution and routing of
orders, and for performing the regulatory compliance checks to each of
those functions. The proposed rule change also removes impediments to
and perfects the mechanism of a free and open market and protects
investors and the public interest because it provides additional
specificity, clarity and transparency. The Exchange believes the
proposed rule change to amend Rule 17 also removes impediments to and
perfects the mechanism of a free and open market and protects investors
and the public interest because the proposed rule change would enhance
the clarity and transparency in Exchange Rules surrounding the inbound
routing function performed by Arca Securities for the Exchange's
affiliate, NYSE Chicago.
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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. 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 and routing decisions, and provide clarity
in Exchange rules that Arca Securities would perform the inbound
routing function on behalf on the Exchange's affiliate, NYSE Chicago.
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 \7\ and Rule 19b-4(f)(6) thereunder.\8\
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
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.\9\
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\7\ 15 U.S.C. 78s(b)(3)(A)(iii).
\8\ 17 CFR 240.19b-4(f)(6).
\9\ 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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A proposed rule change filed under Rule 19b-4(f)(6) \10\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b4(f)(6)(iii),\11\ the Commission
may 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 so that the proposal
may become operative immediately upon filing. The Exchange represents
that the proposal would correctly identify and publicly state on a
market-by-market basis all of the specific network processor and
proprietary data feeds that the Exchange utilizes for the handling,
execution and routing of orders, and for performing the regulatory
compliance checks to each of those functions. Further, the Exchange
represents that the proposal would enhance the clarity and transparency
in Exchange Rules surrounding the inbound routing function performed by
Arca Securities for the Exchange's affiliate, NYSE Chicago. The
Commission believes that waiver of the 30-day operative delay is
consistent with the protection of investors and the public interest,
and hereby waives the operative delay and designates the proposed rule
change as operative upon filing.\12\
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\10\ 17 CFR 240.19b-4(f)(6).
\11\ 17 CFR 240.19b-4(f)(6)(iii).
\12\ For purposes only of waiving the operative delay for this
proposal, 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 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. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \13\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\13\ 15 U.S.C. 78s(b)(2)(B).
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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-NYSE-2019-57 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-NYSE-2019-57. 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 website (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
[[Page 61960]]
those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for website 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. Persons submitting
comments are cautioned that we do not redact or edit personal
identifying information from comment submissions. You should submit
only information that you wish to make available publicly. All
submissions should refer to File Number SR-NYSE-2019-57 and should be
submitted on or before December 5, 2019.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-24692 Filed 11-13-19; 8:45 am]
BILLING CODE 8011-01-P