[Federal Register Volume 82, Number 106 (Monday, June 5, 2017)]
[Notices]
[Pages 25879-25887]
[FR Doc No: 2017-11501]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80806; File No. SR-NYSEArca-2017-53]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Adopting New NYSE
Arca Rule 11.21 and NYSE Arca Equities Rule 5220, NYSE Arca Rule 10.18
and NYSE Arca Equities Rule 10.16, and Amending NYSE Arca Rule 10.17
and NYSE Arca Equities 10.15

May 30, 2017.
    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 May 17, 2017, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE Arca'')
filed with the Securities and Exchange Commission (``SEC'' or
``Commission'') the proposed rule change as described in Items I, II,
and III 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 propose (1) a new NYSE Arca Rule 11.21 and a new NYSE
Arca Equities Rule 5220 that define and prohibit two types of
disruptive quoting and trading activity on the Exchange; (2) a new NYSE
Arca Rule 10.18 and a new NYSE Arca Equities Rule 10.16 governing
supplemental expedited suspension proceedings; and (3) amendments to
NYSE Arca Rule 10.17 and NYSE Arca Equities 10.15 to permit release to
the public of suspension notices and orders issued pursuant to proposed
NYSE Arca Rule 10.18 and NYSE Arca Equities Rule 10.16, respectively.
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 Exchange proposes (1) a new NYSE Arca Rule 11.21 and NYSE Arca
Equities Rule 5220 that define and prohibit two types of disruptive
quoting and trading activity on the Exchange; (2) a new NYSE Arca Rule
10.18 and NYSE Arca Equities Rule 10.16 governing supplemental
expedited suspension proceedings; and (3) amendments to NYSE Arca Rule
10.17 and NYSE Arca Equities 10.15 to permit release to the public of
suspension notices and orders issued pursuant to proposed NYSE Arca
Rule 10.18 and NYSE Arca Equities Rule 10.16, respectively.
    The proposed rule change is based on rules recently adopted by Bats
BZX Exchange, Inc., formerly known as BATS Exchange, Inc. (``BATS''),
and The Nasdaq Stock Market LLC (``NASDAQ'').\3\ The proposed rules are
the same as those adopted by BATS and NASDAQ, with the following
exceptions discussed below: (1) Conforming references to reflect the
Exchange's equities and options membership and disciplinary process;
and (2) the call for review process in proposed Rule NYSE Arca Rule
10.18(f) and NYSE Arca Equities Rule 10.16(f). The Exchange believes
that having consistent rules for issuing a cease and desist order on an
expedited basis as other self-regulatory organizations (``SROs'') to
halt certain disruptive and manipulative quoting and trading activity
would enhance the Exchange's ability to protect investors and market
integrity.
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    \3\ On February 18, 2016, the SEC approved a proposed rule
change filed by BATS to adopt new BATS Rule 12.15, which prohibits
certain types of disruptive quoting and trading activities, and BATS
Rule 8.17, which permits BATS to conduct a new expedited suspension
proceeding when it believes BATS Rule 12.15 has been violated. See
Securities Exchange Act Release No. 77171 (February 18, 2016), 81 FR
9017 (February 23, 2016) (SR-BATS-2015-101) (``BATS Approval
Order''); see also Securities Exchange Act Release No. 77606 (April
13, 2016), 81 FR 23026 (April 19, 2016) (SR-BatsEDGA-2016-03)
(adopting identical rules for Bats EDGA Exchange, Inc.); Securities
Exchange Act Release No. 77602 (April 13, 2016), 81 FR 23046 (April
19, 2016) (SR-BatsBYX-2016-03) (adopting identical rules for Bats
BYX Exchange, Inc.); Securities Exchange Act Release No. 77589
(April 12, 2016), 81 FR 22691 (April 18, 2016) (SR-BatsEDGX-2016-04)
(adopting identical rules for Bats EDGX Exchange, Inc.). On May 19,
2016, NASDAQ filed a substantially similar proposed rule change with
the SEC for immediate effectiveness. See Securities Exchange Act
Release No. 77913 (May 25, 2016), 81 FR 35081 (June 1, 2016) (SR-
NASDAQ-2016-074). NASDAQ has also extended the rule to other
exchanges. See, e.g., Securities Exchange Act Release No. 78208
(June 30, 2016), 81 FR 44366 (July 7, 2016) (SR-NASDAQ-2016-092).
Similarly, the Financial Industry Regulatory Authority, Inc.
(``FINRA'') also recently prohibited disruptive quoting and trading
and amended its procedural rules. See Securities Exchange Act
Release No. 76361 (November 21, 2016), 81 FR 85650 (November 28,
2016) (SR-FINRA-2016-043). See also Securities Exchange Act Release
No. 79182 (October 28, 2016), 81 FR 76639 (November 3, 2016) (SR-
MIAX-2016-40) (adopting identical rules for Miami International
Securities Exchange LLC); Securities Exchange Act Release No. 79646
(December 21, 2016), 81 FR 95713 (December 28, 2016) (SR-BOX-2016-
59) (adopting identical rules for BOX Options Exchange LLC).>
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Background
    As a national securities exchange registered pursuant to Section 6
of the Act, the Exchange is required to be organized and to have the
capacity to enforce compliance by its member organizations and persons
associated with its member organizations, with the Act, the rules and
regulations thereunder, and the Exchange's Rules.\4\ Further, the
Exchange's Rules are required to be ``designed to prevent fraudulent
and manipulative acts and practices, to promote just and equitable
principles of trade . . . and, in general, to protect investors and the
public interest.'' \5\
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    \4\ 15 U.S.C. 78f(b)(1).
    \5\ 15 U.S.C. 78f(b)(1).
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    In fulfilling these requirements, the Exchange has developed a
comprehensive regulatory program that

includes automated surveillance of trading activity operated directly
by Exchange staff. When disruptive and potentially manipulative or
improper quoting and trading activity is identified, the Exchange
conducts an investigation into the activity and requests documents and
information. To the extent violations of the Act, the rules and
regulations thereunder, or Exchange Rules are identified, the Exchange
will commence disciplinary proceedings, which could result in, among
other things, a censure, a requirement to take certain remedial
actions, one or more restrictions on future business activities, a
monetary fine, or a temporary or permanent ban from the securities
industry.
    The process described above, from the identification of disruptive
and potentially manipulative or improper quoting and trading activity
to a final resolution of the matter, can often take several years. The
Exchange believes that this time period sometimes is necessary and
appropriate to afford adequate due process, particularly in complex
cases. However, as described below, the Exchange believes that there
are certain obvious and uncomplicated cases of disruptive and
manipulative behavior or cases where the potential harm to investors is
so large that the Exchange should have the authority to initiate an
expedited suspension proceeding in order to stop the behavior from
continuing on the Exchange. In recent years, several cases have been
brought and resolved by the Exchange and other SROs involving
allegations of wide-spread market manipulation, much of which was
ultimately being conducted by foreign persons and entities using
relatively rudimentary technology to access the markets and over which
the Exchange and other SROs had no direct jurisdiction. In each case,
the conduct involved a pattern of disruptive quoting and trading
activity indicative of manipulative layering \6\ or spoofing.\7\
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    \6\ ``Layering'' can include a form of market manipulation in
which multiple, non-bona fide limit orders are entered on one side
of the market at various price levels in order to create the
appearance of a change in the levels of supply and demand, thereby
artificially moving the price of the security. An order is then
executed on the opposite side of the market at the artificially
created price, and the non-bona fide orders are cancelled.
    \7\ ``Spoofing'' can include a form of market manipulation that
involves the market manipulator placing non-bona fide orders that
are intended to trigger some type of market movement and/or response
from other market participants, from which the market manipulator
might benefit by trading bona fide orders.
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    The Exchange and other SROs were able to identify the disruptive
quoting and trading activity in real-time or near real-time;
nonetheless, the parties responsible for such conduct or responsible
for their customers' conduct continued the disruptive quoting and
trading activity on the Exchange and other exchanges during the
entirety of the subsequent lengthy investigation and enforcement
process. To supplement other Exchange Rules on which it may already
rely to stop such activity from continuing, the Exchange believes that
it should have additional authority to initiate expedited suspension
proceedings in order to stop behavior from continuing on the Exchange
if a member organization or a person associated with its member
organization is engaging in or facilitating disruptive quoting and
trading activity and the member organization or associated person has
received sufficient notice with an opportunity to respond, but such
activity has not ceased. The following examples involving the Exchange
and its affiliate the New York Stock Exchange LLC (``NYSE'') are
instructive regarding the rationale for the proposed rule change.
    In July 2012, Biremis Corp. (formerly Swift Trade Securities USA,
Inc.) (``Biremis'') and its CEO were barred from the securities
industry for, among other things, supervisory violations related to a
failure by Biremis to detect and prevent disruptive and allegedly
manipulative trading activities, including layering, short sale
violations, and anti-money laundering violations.\8\ Biremis' sole
business was providing trade execution services via a proprietary day
trading platform and order management system to day traders located in
foreign jurisdictions. Thus, the disruptive and allegedly manipulative
trading activity introduced by Biremis to U.S. markets originated
directly or indirectly from its foreign clients. The pattern of
disruptive and allegedly manipulative quoting and trading activity was
widespread across multiple exchanges, and the NYSE, FINRA, and other
SROs identified clear patterns of the behavior in 2007 and 2008.
Although Biremis and its principals were on notice of the disruptive
and allegedly manipulative quoting and trading activity that was
occurring, Biremis took little to no action to attempt to supervise or
prevent such quoting and trading activity until at least 2009. Even
when it put some controls in place, they were deficient and the pattern
of disruptive and allegedly manipulative trading activity continued to
occur. As noted above, the final resolution of the enforcement action
to bar the firm and its CEO from the industry was not concluded until
2012, four years after the disruptive and allegedly manipulative
trading activity was first identified.
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    \8\ See Biremis Corp. and Peter Beck, FINRA Letter of
Acceptance, Waiver and Consent No.<PHONE_NUMBER>202, July 30, 2012.
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    In September of 2012, Hold Brothers On-Line Investment Services,
Inc. (``Hold Brothers'') settled a regulatory action in connection with
its provision of a trading platform, trade software and trade
execution, support and clearing services for day traders.\9\ Many
traders using the firm's services were located in foreign
jurisdictions. Hold Brothers ultimately settled the action with FINRA
and several exchanges, including NYSE Arca, for a total monetary fine
of $3.4 million. In a separate action, the Firm settled with the
Commission for a monetary fine of $2.5 million.\10\ Among the alleged
violations in the case were disruptive and allegedly manipulative
quoting and trading activity, including spoofing, layering, wash
trading, and pre-arranged trading. Through its conduct and insufficient
procedures and controls, Hold Brothers also allegedly committed anti-
money laundering violations by failing to detect and report
manipulative and suspicious trading activity. Hold Brothers was alleged
to have not only provided foreign traders with access to the U.S.
markets to engage in such activities, but that its principals also
owned and funded foreign subsidiaries that engaged in the disruptive
and allegedly manipulative quoting and trading activity. Although the
pattern of disruptive and allegedly manipulative quoting and trading
activity was identified in 2009, as noted above, the enforcement action
was not concluded until 2012. Thus, although disruptive and allegedly
manipulative quoting and trading was promptly detected, it continued
for several years. The Exchange also notes that criminal proceedings
were initiated against Navinder Singh Sarao for manipulative trading
activity, including forms of layering and spoofing in the futures
markets, that were identified as a contributing factor to the ``Flash
Crash'' of 2010, and yet continued through 2015. In November 2016, Mr.
Sarao pled guilty to one count each of wire fraud and spoofing.\11\
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    \9\ See Hold Brothers On-Line Investment Services, LLC, FINRA
Letter of Acceptance, Waiver and Consent No.<PHONE_NUMBER>0001,
September 25, 2012.
    \10\ In the Matter of Hold Brothers On-Line Investment Services,
LLC, Exchange Act Release No. 67924, September 25, 2012.
    \11\ The plea agreement in United States v. Navinder Singh
Sarao, Docket Number: 1:15-CR-00075-1 (N.D. Ill.), is available at
https://www.justice.gov/criminal-fraud/file/910196/download.

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    The Exchange believes that the activities described in the cases
above provide justification for the proposed rule change, which is
described below.

Proposed Rule Change

Disruptive Quoting and Trading Activity Rules

Proposed NYSE Arca Rule 11.21
    The Exchange proposes to adopt new NYSE Arca Rule 11.21 to define
and prohibit disruptive quoting and trading activity on the Exchange.
Proposed NYSE Arca Rule 11.21(a) would prohibit OTP Holders, OTP Firms
or any participant \12\ from engaging in or facilitating disruptive
quoting and trading activity on the Exchange, as described in proposed
NYSE Arca Rule 11.21(b)(1) and (2), including acting in concert with
other persons to effect such activity. The Exchange believes that it is
necessary to extend the prohibition to situations when persons are
acting in concert to avoid a potential loophole where disruptive
quoting and trading activity is simply split between several brokers or
customers. The Exchange also believes, that with respect to persons
acting in concert perpetrating an abusive scheme, it is important that
the Exchange have authority to act against the parties perpetrating the
abusive scheme, whether it is one person or multiple persons.
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    \12\ The term ``OTP'' refers to an Options Trading Permit issued
by the Exchange for effecting approved securities transactions on
the Exchange's Trading Facilities. See NYSE Arca Rule 1(p). NYSE
Arca Rule 1(t) defines ``participant'' to mean any ``OTP Holder,
Allied Person, partner, approved person, stockholder associate,
registered employee or other full-time employee of an OTP Firm.''
NYSE Arca Equities Rule 1(q) defines ``OTP Holder'' as a ``natural
person, in good standing, who has been issued an OTP, or has been
named as a Nominee.'' An OTP Holder must be a registered broker or
dealer or a nominee or an associated person of a registered broker
or dealer approved by the Exchange to conduct business on the
Exchange's Trading Facilities, which is defined as the Exchange's
``facilities for the trading of options, office space provided by
the Exchange to OTP Holders and OTP Firms in connection with their
floor trading activities, and any and all electronic or automated
order execution systems and reporting services provided by the
Exchange to OTP Holders and OTP Firms.'' See Rule 1(aa). An ``OTP
Firm'' means a proprietorship, partnership, corporation, limited
liability company or other organization in good standing who holds
an OTP or upon whom an individual OTP Holder has conferred trading
privileges on the Exchange's Trading Facilities. An OTP Firm must
also be a registered broker or dealer.
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    The Exchange proposes to adopt NYSE Arca Rule 11.21(b)(1) and (2)
providing additional details regarding disruptive quoting and trading
activity. Proposed NYSE Arca Rule 11.21(b)(1) would describe disruptive
quoting and trading activity containing many of the elements indicative
of layering. For purposes of the proposed Rule, disruptive quoting and
trading activity would include a frequent pattern in which the
following facts are present:
     A party enters multiple limit orders on one side of the
market at various price levels (the ``Displayed Orders'') (proposed
NYSE Arca Rule 11.21(b)(1)(A)); and
     following the entry of the Displayed Orders, the level of
supply and demand for the security changes (proposed NYSE Arca Rule
11.21(b)(1)(B)); and
     the party enters one or more orders on the opposite side
of the market of the Displayed Orders (the ``Contra-Side Orders'') that
are subsequently executed (proposed NYSE Arca Rule 11.21(b)(1)(C)); and
     following the execution of the Contra-Side Orders, the
party cancels the Displayed Orders (proposed NYSE Arca Rule
11.21(b)(1)(D)).
    Proposed NYSE Arca Rule 11.21(b)(2) would describe disruptive
quoting and trading activity containing many of the elements indicative
of spoofing and would describe disruptive quoting and trading activity
as a frequent pattern in which the following facts are present:
     A party narrows the spread for a security by placing an
order inside the national best bid or offer (proposed NYSE Arca Rule
11.21(b)(2)(A)); and
     the party then submits an order on the opposite side of
the market that executes against another market participant that joined
the new inside market established by the order described in proposed
(b)(2)(A) that narrowed the spread (proposed NYSE Arca Rule
11.21(b)(2)(B)).
    The Exchange believes that the proposed descriptions of disruptive
quoting and trading activity articulated in the rule are consistent
with the activities that have been identified and described in the
client access cases described above and with the rules of other
SROs.\13\
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    \13\ See, e.g., BATS Rule 12.15; NASDAQ Rule 2170. See generally
note 4, supra.
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    Proposed NYSE Arca Rule 11.21(c) would provide that, unless
otherwise indicated, the descriptions of disruptive quoting and trading
activity do not require the facts to occur in a specific order in order
for the Rule to apply. For instance, with respect to the pattern
defined in proposed Rule 11.21(b)(1)(A)-(D), it is of no consequence
whether a party first enters Displayed Orders and then Contra-side
Orders or vice-versa. However, as proposed, it is required for supply
and demand to change following the entry of the Displayed Orders.
    The Exchange also proposes to make clear that disruptive quoting
and trading activity includes a pattern or practice in which some
portion of the disruptive quoting and trading activity is conducted on
the Exchange and the other portions of the disruptive quoting and
trading activity are conducted on one or more other exchanges. The
Exchange believes that this authority is necessary to address market
participants who would otherwise seek to avoid the prohibitions of the
proposed Rule by spreading their activity amongst various execution
venues.
Proposed NYSE Arca Equities Rule 5220
    The Exchange proposes to adopt a new NYSE Arca Equities Rule 5220
that would be substantially the same as proposed NYSE Arca Rule 11.21.
    Like its NYSE Arca counterpart, proposed NYSE Arca Equities Rule
5220 would define and prohibit disruptive quoting and trading activity
on the Exchange. Proposed NYSE Arca Equities Rule 5220(a) would
prohibit ETP Holders or associated persons of ETP Holders \14\ from
engaging in or facilitating disruptive quoting and trading activity on
the Exchange, as described in proposed NYSE Arca Equities Rule
5220(b)(1) and (2), including acting in concert with other persons to
effect such activity. Proposed NYSE Arca Equities Rule 5220(b)(1) would
describe disruptive quoting and trading activity containing many of the
elements indicative of layering. For purposes of the proposed Rule,
disruptive quoting and trading activity would include a frequent
pattern in which the following facts are present:
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    \14\ The term ``ETP'' refers to an Equity Trading Permit issued
by the Exchange for effecting approved securities transactions on
NYSE Arca Equities' Trading Facilities. See NYSE Arca Equities Rule
1(m). NYSE Arca Equities Rule 1(n) defines ``ETP Holder'' as a sole
proprietorship, partnership, corporation, limited liability company
or other organization in good standing that has been issued an ETP.
An ETP Holder must also be a registered broker or dealer.
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     A party enters multiple limit orders on one side of the
market at various price levels (the ``Displayed Orders'') (proposed
NYSE Arca Equities Rule 5220(b)(1)(A)); and
     following the entry of the Displayed Orders, the level of
supply and demand for the security changes (proposed NYSE Arca Equities
Rule 5220(b)(1)(B)); and
     the party enters one or more orders on the opposite side
of the market of the Displayed Orders (the ``Contra-Side Orders'') that
are subsequently executed (proposed NYSE Arca Equities Rule
5220(b)(1)(C)); and

     following the execution of the Contra-Side Orders, the
party cancels the Displayed Orders (proposed NYSE Arca Equities Rule
5220(b)(1)(D)).
    Proposed Rule 996NY(b)(2) would describe disruptive quoting and
trading activity containing many of the elements indicative of spoofing
and would describe disruptive quoting and trading activity as a
frequent pattern in which the following facts are present:
     A party narrows the spread for a security by placing an
order inside the national best bid or offer (proposed NYSE Arca
Equities Rule 5220(b)(2)(A)); and
     the party then submits an order on the opposite side of
the market that executes against another market participant that joined
the new inside market established by the order described in proposed
(b)(2)(A) that narrowed the spread (proposed NYSE Arca Equities Rule
5220(b)(2)(B)).
    As with proposed NYSE Arca Rule 11.21, the Exchange believes that
the proposed descriptions of disruptive quoting and trading activity
articulated in the proposed NYSE Arca Equities Rule are consistent with
the activities that have been identified and described in the client
access cases described above and with the rules of other SROs.\15\
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    \15\ See, e.g., BATS Rule 12.15; NASDAQ Rule 2170; BOX Options
Exchange LLC Rule 3220. See generally note 3, supra.
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    Proposed NYSE Arca Equities Rule 5220(c) would provide that, unless
otherwise indicated, the descriptions of disruptive quoting and trading
activity do not require the facts to occur in a specific order in order
for the Rule to apply. The proposed Rule would also make clear that
disruptive quoting and trading activity includes a pattern or practice
in which some portion of the disruptive quoting and trading activity is
conducted on the Exchange and the other portions of the disruptive
quoting and trading activity are conducted on one or more other
exchanges.

Procedural Rules

Proposed NYSE Arca Rule 10.18
    The Exchange proposes a new NYSE Arca Rule 10.18 that would set
forth procedures for issuing suspension orders, immediately prohibiting
a member organization or covered person from conducting continued
disruptive quoting and trading activity on the Exchange. Importantly,
these procedures would also provide the Exchange the authority to order
a member organization or covered person to cease and desist from
providing access to the Exchange to a client that is conducting
disruptive quoting and trading activity.
    Under proposed paragraph (a)(1) of NYSE Arca Rule 10.18, with the
prior written authorization of the Chief Regulatory Officer (``CRO'')
or such other senior officers as the CRO may designate, the Exchange's
Enforcement department may initiate an expedited suspension proceeding
with respect to alleged violations of NYSE Arca Rule 11.21 (Disruptive
Quoting and Trading Activity Prohibited). Proposed paragraph (a) would
also set forth the requirements for notice ((a)(2)) and service of such
notice ((a)(3)) pursuant to the Rule, including the required method of
service and the content of notice.
    Proposed paragraph (b) of NYSE Arca Rule 10.18 would govern the
appointment of a Conduct Panel, and would provide that a Conduct Panel
shall be assigned in accordance with paragraph (a) of NYSE Arca Rule
10.5.\16\
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    \16\ NYSE Arca Rule 10.5 governs hearings and provides that the
Ethics and Business Conduct Committee (``EBCC'') shall appoint three
or more members to hear a matter once a hearing is requested. See
NYSE Arca Rule 10.5(a). NYSE Arca Rule 10.5 also provides for a
Hearing Administrator to oversee the Conduct Panel rather than a
hearing officer. There is also no process under NYSE Arca Rules for
the recusal or disqualification of Hearing Administrators.
Accordingly, the Exchange does not propose to adopt those provisions
from the BATS procedural rules governing the recusal and
disqualification of hearing officer in connection with a suspension
proceeding. See BAT Rule 8.17(b)(2).
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    Under paragraph (c)(1) of the proposed Rule, the hearing would be
held not later than 15 days after service of the notice initiating the
suspension proceeding, unless otherwise extended by the Hearing
Administrator with the consent of the Parties for good cause shown.
    Under paragraph (c)(2) of the proposed Rule, a notice of date,
time, and place of the hearing shall be served on the Parties not later
than seven days before the hearing, unless otherwise ordered by the
Hearing Administrator. Under the proposed Rule, service shall be made
by personal service or overnight commercial courier and shall be
effective upon service.
    Proposed paragraph (c) would also govern how the hearing is
conducted, including the authority of Hearing Administrators ((c)(3),
witnesses ((c)(4)), additional information that may be required by the
Conduct Panel ((c)(5)), the requirement that a transcript of the
proceeding be created and details related to such transcript ((c)(6)),
and details regarding the creation and maintenance of the record of the
proceeding ((c)(7)). Proposed paragraph (c)(8) would also provide that
if a Respondent fails to appear at a hearing for which it has notice,
the allegations in the notice and accompanying declaration may be
deemed admitted, and the Conduct Panel may issue a suspension order
without further proceedings. Finally, as proposed, if the Exchange
fails to appear at a hearing for which it has notice, the Conduct Panel
may order that the suspension proceeding be dismissed.
    Under paragraph (d)(1) of the proposed Rule, the Conduct Panel
would be required to issue a written decision stating whether a
suspension order would be imposed. The Conduct Panel would be required
to issue the decision not later than 10 days after receipt of the
hearing transcript, unless otherwise extended by the Chairman of the
Conduct Panel with the consent of the Parties for good cause shown. The
proposed Rule would state that a suspension order shall be imposed if
the Conduct Panel finds by a preponderance of the evidence that the
alleged violation specified in the notice has occurred and that the
violative conduct or continuation thereof is likely to result in
significant market disruption or other significant harm to investors.
    Proposed paragraph (d)(2) would also describe the content, scope
and form of a suspension order. As proposed, a suspension order shall
be limited to ordering a Respondent to cease and desist from violating
NYSE Arca Rule 11.21 and/or ordering a Respondent to cease and desist
from providing access to the Exchange to a client of Respondent that is
causing violations of NYSE Arca Rule 11.21 ((d)(2)(A)). Under the
proposed rule, a suspension order shall also set forth the alleged
violation and the significant market disruption or other significant
harm to investors that is likely to result without the issuance of an
order ((d)(2)(B)). The order shall describe in reasonable detail the
act or acts the Respondent is to take or refrain from taking, and
suspend such Respondent unless and until such action is taken or
refrained from ((d)(2)(C)). Finally, the order shall include the date
and hour of its issuance ((d)(2)(D)).
    As proposed, under proposed paragraph (d)(3), a suspension order
would remain effective and enforceable unless modified, set aside,
limited, or revoked pursuant to proposed paragraph (e), as described
below.
    Finally, paragraph (d)(4) would require service of the Conduct
Panel's decision and any suspension order consistent with other
portions of the proposed rule related to service.
    Proposed paragraph (e) of NYSE Arca Rule 10.18 would provide that
at any

time after the Hearing Administrator served the Respondent with a
suspension order, a Party could apply to the Conduct Panel to have the
order modified, set aside, limited, or revoked. If any part of a
suspension order is modified, set aside, limited, or revoked, proposed
paragraph (e) provides the Conduct Panel discretion to leave the cease
and desist part of the order in place. For example, if a suspension
order suspends Respondent unless and until Respondent ceases and
desists providing access to the Exchange to a client of Respondent, and
after the order is entered the Respondent complies, the Conduct Panel
is permitted to modify the order to lift the suspension portion of the
order while keeping in place the cease and desist portion of the order.
With its broad modification powers, the Conduct Panel also maintains
the discretion to impose conditions upon the removal of a suspension--
for example, the Conduct Panel could modify an order to lift the
suspension portion of the order in the event a Respondent complies with
the cease and desist portion of the order but additionally order that
the suspension will be re-imposed if Respondent violates the cease and
desist provisions modified order in the future. The Conduct Panel
generally would be required to respond to the request in writing within
10 days after receipt of the request. An application to modify, set
aside, limit or revoke a suspension order would not stay the
effectiveness of the suspension order.
    Proposed paragraph (f) would describe the call for review process
by the Exchange Board of Directors. Specifically, the proposed Rule
would provide that if there is no pending application to the Conduct
Panel to have a suspension order modified, set aside, limited, or
revoked, the Exchange Board of Directors, in accordance with NYSE Arca
Rule 10.8 (Review), may call for review the Conduct Panel decision on
whether to issue a suspension order. Further, the proposed Rule would
provide that a call for review by the Exchange Board of Directors shall
not stay the effectiveness of a suspension order.
    Finally, proposed paragraph (g) would provide that sanctions issued
under the proposed Rule 10.18 would constitute final and immediately
effective disciplinary sanctions imposed by the Exchange, and that the
right to have any action under the Rule reviewed by the Commission
would be governed by Section 19 of the Act. The filing of an
application for review would not stay the effectiveness of a suspension
order unless the Commission otherwise ordered.
Proposed NYSE Arca Equities Rule 10.16
    The Exchange proposes a new NYSE Arca Equities Rule 10.16 that
would set forth procedures for issuing suspension orders, immediately
prohibiting a member organization or covered person from conducting
continued disruptive quoting and trading activity on the Exchange.
Importantly, these procedures would also provide the Exchange the
authority to order a member organization or covered person to cease and
desist from providing access to the Exchange to a client that is
conducting disruptive quoting and trading activity.
    Under proposed paragraph (a)(1) of NYSE Arca Equities Rule 10.16,
with the prior written authorization of the Chief Regulatory Officer
(``CRO'') or such other senior officers as the CRO may designate, the
Exchange's Enforcement department may initiate an expedited suspension
proceeding with respect to alleged violations of NYSE Arca Equities
Rule 5220 (Disruptive Quoting and Trading Activity Prohibited).
Proposed paragraph (a) would also set forth the requirements for notice
((a)(2)) and service of such notice ((a)(3)) pursuant to the Rule,
including the required method of service and the content of notice.
    Proposed paragraph (b) of NYSE Arca Equities Rule 10.16 would
govern the appointment of a Conduct Panel, and would provide that a
Conduct Panel shall be assigned in accordance with paragraph (a) of
NYSE Arca Rule 10.5.\17\
---------------------------------------------------------------------------

    \17\ NYSE Arca Equities Rule 10.5 governs hearings and provides
that the Business Conduct Committee (``BCC'') shall appoint one or
more members to hear a matter once a hearing is requested. See NYSE
Arca Equities Rule 10.5(a). NYSE Arca Equities Rule 10.5 also
provides for a Hearing Administrator to oversee the Conduct Panel
rather than a hearing officer. There is also no process under NYSE
Arca Equities Rules for the recusal or disqualification of Hearing
Administrators. Accordingly, the Exchange does not propose to adopt
those provisions from the BATS procedural rules governing the
recusal and disqualification of hearing officer in connection with a
suspension proceeding on NYSE Arca Equities. See BAT Rule
8.17(b)(2).
---------------------------------------------------------------------------

    Under paragraph (c)(1) of the proposed Rule, the hearing would be
held not later than 15 days after service of the notice initiating the
suspension proceeding, unless otherwise extended by the Hearing
Administrator with the consent of the Parties for good cause shown.
    Under paragraph (c)(2) of the proposed Rule, a notice of date,
time, and place of the hearing shall be served on the Parties not later
than seven days before the hearing, unless otherwise ordered by the
Hearing Administrator. Under the proposed Rule, service shall be made
by personal service or overnight commercial courier and shall be
effective upon service.
    Proposed paragraph (c) would also govern how the hearing is
conducted, including the authority of Hearing Administrator ((c)(3),
witnesses ((c)(4)), additional information that may be required by the
Conduct Panel ((c)(5)), the requirement that a transcript of the
proceeding be created and details related to such transcript ((c)(6)),
and details regarding the creation and maintenance of the record of the
proceeding ((c)(7)). Proposed paragraph (c)(8) would also provide that
if a Respondent fails to appear at a hearing for which it has notice,
the allegations in the notice and accompanying declaration may be
deemed admitted, and the Conduct Panel may issue a suspension order
without further proceedings. Finally, as proposed, if the Exchange
fails to appear at a hearing for which it has notice, the Conduct Panel
may order that the suspension proceeding be dismissed.
    Under paragraph (d)(1) of the proposed Rule, the Conduct Panel
would be required to issue a written decision stating whether a
suspension order would be imposed. The Conduct Panel would be required
to issue the decision not later than 10 days after receipt of the
hearing transcript, unless otherwise extended by the Hearing
Administrator with the consent of the Parties for good cause shown. The
proposed Rule would state that a suspension order shall be imposed if
the Conduct Panel finds by a preponderance of the evidence that the
alleged violation specified in the notice has occurred and that the
violative conduct or continuation thereof is likely to result in
significant market disruption or other significant harm to investors.
    Proposed paragraph (d)(2) would also describe the content, scope
and form of a suspension order. As proposed, a suspension order shall
be limited to ordering a Respondent to cease and desist from violating
proposed NYSE Arca Equities Rule 5220, and/or to ordering a Respondent
to cease and desist from providing access to the Exchange to a client
of Respondent that is causing violations of proposed NYSE Arca Equities
Rule 5220 ((d)(2)(A)). Under the proposed rule, a suspension order
shall also set forth the alleged violation and the significant market
disruption or other significant harm to investors that is likely to
result without the issuance of an order ((d)(2)(B)). The order shall
describe in reasonable detail the act or acts the Respondent is to take

or refrain from taking, and suspend such Respondent unless and until
such action is taken or refrained from ((d)(2)(C)). Finally, the order
shall include the date and hour of its issuance ((d)(2)(D)).
    As proposed, under proposed paragraph (d)(3), a suspension order
would remain effective and enforceable unless modified, set aside,
limited, or revoked pursuant to proposed paragraph (e), as described
below.
    Finally, paragraph (d)(4) would require service of the Conduct
Panel's decision and any suspension order consistent with other
portions of the proposed rule related to service.
    Proposed paragraph (e) of NYSE Arca Equities Rule 10.16 would
provide that at any time after the Hearing Administrator serves the
Respondent with a suspension order, a Party could apply to the Conduct
Panel to have the order modified, set aside, limited, or revoked. If
any part of a suspension order is modified, set aside, limited, or
revoked, proposed paragraph (e) of NYSE Arca Equities Rule 10.16
provides the Conduct Panel discretion to leave the cease and desist
part of the order in place. For example, if a suspension order suspends
Respondent unless and until Respondent ceases and desists providing
access to the Exchange to a client of Respondent, and after the order
is entered the Respondent complies, the Conduct Panel is permitted to
modify the order to lift the suspension portion of the order while
keeping in place the cease and desist portion of the order. With its
broad modification powers, the Conduct Panel also maintains the
discretion to impose conditions upon the removal of a suspension--for
example, the Conduct Panel could modify an order to lift the suspension
portion of the order in the event a Respondent complies with the cease
and desist portion of the order but additionally order that the
suspension will be re-imposed if Respondent violates the cease and
desist provisions modified order in the future. The Conduct Panel
generally would be required to respond to the request in writing within
10 days after receipt of the request. An application to modify, set
aside, limit or revoke a suspension order would not stay the
effectiveness of the suspension order.
    Proposed paragraph (f) would describe the call for review process
by the Exchange Board of Directors. Specifically, the proposed Rule
would provide that if there is no pending application to the Conduct
Panel to have a suspension order modified, set aside, limited, or
revoked, the Exchange Board of Directors, in accordance with NYSE Arca
Equities Rule 10.8 (Review), may call for review the Conduct Panel
decision on whether to issue a suspension order. Further, the proposed
Rule would provide that a call for review by the Exchange Board of
Directors shall not stay the effectiveness of a suspension order.
    Finally, proposed paragraph (g) would provide that sanctions issued
under the proposed NYSE Arca Equities Rule 10.16 would constitute final
and immediately effective disciplinary sanctions imposed by the
Exchange, and that the right to have any action under the Rule reviewed
by the Commission would be governed by Section 19 of the Act. The
filing of an application for review would not stay the effectiveness of
a suspension order unless the Commission otherwise ordered.

Release of Disciplinary Complaints, Decisions and Other Information

Proposed Amendments to NYSE Arca Rule 10.17
    The Exchange proposes amendments to NYSE Arca Rule 10.17 to permit
release to the public of suspension notices and orders issued pursuant
to proposed NYSE Arca Rule 10.16. Specifically, the Exchange proposes
to include a notice of the initiation of a suspension proceeding served
pursuant to proposed NYSE Arca Rule 10.18 in the definition of
``disciplinary complaint'' under NYSE Arca Rule 10.17(e)(1). Similarly,
the Exchange would include suspension orders issued pursuant to
proposed NYSE Arca Rule 10.18 in the definition of ``disciplinary
decision'' under NYSE Arca Rule 10.17(e)(2).
Proposed Amendments to NYSE Arca Equities Rule 10.15
    The Exchange proposes amendments to NYSE Arca Equities Rule 10.15
to permit release to the public of suspension notices and orders issued
pursuant to proposed NYSE Arca Equities Rule 10.16. Specifically, the
Exchange proposes to include a notice of the initiation of a suspension
proceeding served pursuant to proposed NYSE Arca Equities Rule 10.16 in
the definition of ``disciplinary complaint'' under NYSE Arca Equities
Rule 10.15(e)(1). Similarly, the Exchange would include suspension
orders issued pursuant to proposed NYSE Arca Equities Rule 10.16 in the
definition of ``disciplinary decision'' under NYSE Arca Equities Rule
10.15(e)(2).
    The proposed amendments to NYSE Arca Rule 10.17 and NYSE Arca
Equities Rule 10.15 are consistent with the FINRA Rule 8313 and the
rules of the other SROs modeled on FINRA Rule 8313.\18\
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    \18\ See FINRA Rule 8313; BATS Rule 8.18.
---------------------------------------------------------------------------

* * * * *
    In summary, proposed NYSE Arca Rule 11.21 and NYSE Arca Equities
Rule 5220 and Rule 996NY, coupled with proposed procedural rule NYSE
Arca Rule 10.18 and NYSE Arca Equities Rule 10.16, respectively, would
provide the Exchange with another form and means of authority to
promptly act to prevent disruptive quoting and trading activity from
continuing on the Exchange. The following example illustrates how the
proposed rule would operate.
    Assume that through its surveillance program, Exchange staff
identifies a pattern of potentially disruptive quoting and trading
activity. After an initial investigation, the Exchange would contact
the member organization or covered person responsible for the orders
that caused the activity to request an explanation of the activity as
well as any additional relevant information, including the source of
the activity. If the Exchange were to continue to see the same pattern
from the same member organization or covered person and the source of
the activity is the same or has been previously identified as a
frequent source of disruptive quoting and trading activity then the
Exchange could initiate an expedited suspension proceeding by serving
notice on the member organization or covered person that would include
details regarding the alleged violations as well as the proposed
sanction.
    In such a case the proposed sanction would likely be to order the
member organization or covered person to cease and desist providing
access to the Exchange to the client that is responsible for the
disruptive quoting and trading activity and to suspend such member
organization or covered person unless and until such action is taken.
The member organization or covered person would have the opportunity to
be heard in front of a Conduct Panel at a hearing to be conducted
within 15 days of the notice. If the Conduct Panel determined that the
violation alleged in the notice did not occur or that the conduct or
its continuation would not have the potential to result in significant
market disruption or other significant harm to investors, then the
Conduct Panel would dismiss the suspension order proceeding. If the
Conduct Panel determined that the violation alleged in the notice did
occur and that the conduct or its continuation is likely to result in
significant market disruption

or other significant harm to investors, then the Conduct Panel would
issue the order including the proposed sanction, ordering the member
organization or covered person to cease providing access to the client
at issue and suspending such Member unless and until such action is
taken.
    If such member organization or covered person wished for the
suspension to be lifted because the client ultimately responsible for
the activity no longer would be provided access to the Exchange, then
such member organization or covered person could apply to the Conduct
Panel to have the order modified, set aside, limited or revoked. The
Exchange notes that the issuance of a suspension order would not alter
the Exchange's ability to further investigate the matter and/or later
sanction the member or member organization pursuant to the Exchange's
standard disciplinary process for supervisory violations or other
violations of Exchange rules or the Act.
    The Exchange reiterates that it already has broad authority to take
action against a member organization or covered person in the event
that such member organization or covered person is engaging in or
facilitating disruptive or manipulative trading activity on the
Exchange. For the reasons described above, and in light of recent
matters such as the client access cases described above, as well as
other cases currently under investigation, the Exchange believes that
it is equally important for the Exchange to have this supplemental
authority to promptly initiate expedited suspension proceedings against
any member organization or covered person who has demonstrated a clear
pattern or practice of disruptive quoting and trading activity, as
described above, and to take action including ordering such member
organization or covered person to terminate access to the Exchange to
one or more clients that are [sic] responsible for the violative
activity.
    The Exchange recognizes that its proposed authority to issue a
suspension order is a powerful measure that should be used very
cautiously. Consequently, the proposed rules have been designed to
ensure that the proceedings are used to address only the most clear and
serious types of disruptive quoting and trading activity and that the
interests of respondents are protected. For example, to ensure that
proceedings are used appropriately and that the decision to initiate a
proceeding is made only at the highest staff levels, the proposed rules
require the CRO or another senior officer of the Exchange to issue
written authorization before the Exchange can institute an expedited
suspension proceeding. In addition, NYSE Arca Rule 10.18 and NYSE Arca
Equities Rule 10.16 are, by their terms, limited to violations of NYSE
Arca Rule 11.21 and NYSE Arca Equities Rule 5220, respectively, when
necessary to protect investors, other member organizations or covered
persons, and the Exchange.
    Further, the Exchange believes that the proposed expedited
suspension provisions described above that provide the opportunity to
respond as well as a Conduct Panel determination prior to taking action
will ensure that the Exchange would not utilize its authority in the
absence of a clear pattern or practice of disruptive quoting and
trading activity. Notwithstanding the adoption of the proposed rules
along with existing disciplinary rules in NYSE Arca Rule and NYSE Arca
Equities Rule 10, the Exchange also notes that that pursuant to NYSE
Arca Rule 13.9 (Failure to Meet the Eligibility or Qualification
Standards or Prerequisites for Access to Services) and NYSE Arca
Equities Rule 11.9 (Failure to Meet the Eligibility or Qualification
Standards or Prerequisites for Access to Services), if a OTP Firms, OTP
Holders or Associated Persons of an OTP Firm or OTP Holder or ETP
Holder or Associated Person of ETP Holder, respectively, cannot
continue to have access to services offered by the Exchange or a member
thereof with safety to investors, creditors, members, or the Exchange,
the Exchange may provide written notice to such member or person
limiting or prohibiting access to services offered by the Exchange or a
member thereof. This ability to impose a temporary restriction upon
Members assists the Exchange in maintaining the integrity of the market
and protecting investors and the public interest.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\19\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\20\ 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,
and, in general to protect investors and the public interest. Pursuant
to the proposal, the Exchange will have a mechanism to promptly
initiate expedited suspension proceedings in the event the Exchange
believes that it has sufficient proof that a violation of proposed NYSE
Arca Rule 11.21 or proposed NYSE Arca Equities Rule 5220 has occurred
and is ongoing.
---------------------------------------------------------------------------

    \19\ 15 U.S.C. 78f(b).
    \20\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    Further, the Exchange believes that the proposal is consistent with
Sections 6(b)(1) and 6(b)(6) of the Act,\21\ which require that the
rules of an exchange enforce compliance with, and provide appropriate
discipline for, violations of the Commission and Exchange rules. The
Exchange believes that the proposal is consistent with the public
interest, the protection of investors, or otherwise in furtherance of
the purposes of the Act because the proposal helps to strengthen the
Exchange's ability to carry out its oversight and enforcement
responsibilities as a self-regulatory organization in cases where
awaiting the conclusion of a full disciplinary proceeding is unsuitable
in view of the potential harm to other member organization and their
customers. The Exchange notes that if this type of conduct is allowed
to continue on the Exchange, the Exchange's reputation could be harmed
because it may appear to the public that the Exchange is not acting to
address the behavior. The proposed expedited process would enable the
Exchange to address the behavior with greater speed.
---------------------------------------------------------------------------

    \21\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    As noted throughout this filing, the Exchange believes that these
rule proposals are necessary for the protection of investors rather
than allowing disruptive quoting and trading activity to occur for
several years. The Exchange believes that the pattern of disruptive and
allegedly manipulative quoting and trading activity was widespread
across multiple exchanges, and the Exchange, FINRA, and other SROs
identified clear patterns of the behavior in 2007 and 2008 in the
equities markets.\22\ The Exchange believes that this proposal will
provide the Exchange with additional means to enforce against such
behavior in an expedited manner while providing member organizations or
covered person with the necessary due process. The Exchange believes
that its proposal is consistent with the Act because it provides the
Exchange with the ability 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 from such ongoing behavior.
---------------------------------------------------------------------------

    \22\ See Section 3 herein, the Purpose section, for examples of
conduct referred to herein.
---------------------------------------------------------------------------

    The Exchange believes that the proposal is also consistent with
Section 6(b)(7) of the Act,\23\ which requires that the rules of an
exchange ``provide a fair procedure for the disciplining of members and
persons associated with members . . . and the prohibition or limitation
by the exchange of any person with respect to access to services
offered by the exchange or a member thereof.'' Finally, the Exchange
also believes the proposal is consistent with Sections 6(d)(1) and
6(d)(2) of the Act,\24\ which require that the rules of an exchange
with respect to a disciplinary proceeding or proceeding that would
limit or prohibit access to or membership in the exchange require the
exchange to: Provide adequate and specific notice of the charges
brought against a member or person associated with a member, provide an
opportunity to defend against such charges, keep a record, and provide
details regarding the findings and applicable sanctions in the event a
determination to impose a disciplinary sanction is made. The Exchange
believes that each of these requirements is addressed by the notice and
due process provisions included within proposed NYSE Arca Rule 10.18
and proposed NYSE Arca Equities Rule 10.16. Importantly, as noted
above, the Exchange will use the authority proposed in this filing only
in clear and egregious cases when necessary to protect investors, other
member organizations or covered persons and the Exchange, and even in
such cases, respondents will be afforded due process in connection with
the suspension proceedings.
---------------------------------------------------------------------------

    \23\ 15 U.S.C. 78f(b)(7).
    \24\ 15 U.S.C. 78f(d)(1).
---------------------------------------------------------------------------

    Finally, the Exchange believes that amending NYSE Arca Rule 10.17
and NYSE Arca Equities Rule 10.15 to permit release to the public of
suspension notices and orders issued pursuant to proposed NYSE Arca
Rule 10.18 and proposed NYSE Arca Equities Rule 10.16, respectively,
furthers the objectives of Section 6(b)(5) of the Act \25\ by providing
greater clarity, consistency, and transparency regarding the release of
disciplinary complaints, decisions and other information to the public.
The Exchange also believes that the proposed rule change promotes
greater transparency to the Exchange's disciplinary process by
providing greater access to information regarding its disciplinary
actions and valuable guidance and information to persons subject to the
Exchange's jurisdiction, regulators, and the investing public.
---------------------------------------------------------------------------

    \25\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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 not necessary or appropriate in
furtherance of the purposes of the Act. To the contrary, the Exchange
believes that each self-regulatory organization should be empowered to
regulate trading occurring on their [sic] market consistent with the
Act and without regard to competitive issues. The Exchange is
requesting authority to take appropriate action if necessary for the
protection of investors, other member organizations or covered persons,
and the Exchange. The Exchange also believes that it is important for
all exchanges to be able to take similar action to enforce its [sic]
rules against manipulative conduct thereby leaving no exchange prey to
such conduct. The Exchange does not believe that the proposed rule
change imposes an undue burden on competition, rather this process will
provide the Exchange with necessary means to enforce against violations
of manipulative quoting and trading activity in an expedited manner,
while providing member organizations or covered persons with the
necessary due process. Finally, the proposed rule change is designed to
enhance the Exchange's rules governing the release of disciplinary
complaints, decisions and other information to the public, thereby
providing greater clarity and consistency and resulting in less
burdensome and more efficient regulatory compliance and facilitating
performance of regulatory functions.

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 \26\ and Rule 19b-4(f)(6) thereunder.\27\
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.
---------------------------------------------------------------------------

    \26\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \27\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \28\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\29\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest.
---------------------------------------------------------------------------

    \28\ 17 CFR 240.19b-4(f)(6).
    \29\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    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) \30\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \30\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

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_ADDRESS>Please include
File Number SR-NYSEArca-2017-53 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-2017-53. 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-2017-53 and should be submitted on or before June 26, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\31\
---------------------------------------------------------------------------

    \31\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-11501 Filed 6-2-17; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 82, Number 237 (Tuesday, December 12, 2017)]
[Notices]
[Page 58386]
[FR Doc No: 2017-26742]

-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

Combined Notice of Filings #2

    Take notice that the Commission received the following electric
rate filings:

    Docket Numbers: ER18-394-000.
    Applicants: Midcontinent Independent System Operator, Inc.
    Description: Sec.  205(d) Rate Filing: 2017-12-06_Attachment P
Grandfathered Agreements Clean-up Filing to be effective 2/5/2018.
    Filed Date: 12/6/17.
    Accession Number: 20171206-5084.
    Comments Due: 5 p.m. ET 12/27/17.

    Docket Numbers: ER18-395-000.
    Applicants: American Falls Solar, LLC.
    Description: Sec.  205(d) Rate Filing: Notice of Change in Status
and MBR Tariff Amendments to be effective 2/5/2018.
    Filed Date: 12/6/17.
    Accession Number: 20171206-5095.
    Comments Due: 5 p.m. ET 12/27/17.

    Docket Numbers: ER18-396-000.
    Applicants: American Falls Solar II, LLC.
    Description: Sec.  205(d) Rate Filing: Notice of Change in Status
and MBR Tariff Amendments to be effective 2/5/2018.
    Filed Date: 12/6/17.
    Accession Number: 20171206-5096.
    Comments Due: 5 p.m. ET 12/27/17.

    Docket Numbers: ER18-397-000.
    Applicants: SunE Beacon Site 2 LLC.
    Description: Sec.  205(d) Rate Filing: Notice of Change in Status
and MBR Tariff Amendments to be effective 2/5/2018.
    Filed Date: 12/6/17.
    Accession Number: 20171206-5097.
    Comments Due: 5 p.m. ET 12/27/17.

    Docket Numbers: ER18-398-000.
    Applicants: SunE Beacon Site 5 LLC.
    Description: Sec.  205(d) Rate Filing: Notice of Change in Status
and MBR Tariff Amendments to be effective 2/5/2018.
    Filed Date: 12/6/17.
    Accession Number: 20171206-5098.
    Comments Due: 5 p.m. ET 12/27/17.

    Docket Numbers: ER18-399-000.
    Applicants: PJM Interconnection, L.L.C.
    Description: Sec.  205(d) Rate Filing: Amendment to Service
Agreement No. 3322, Queue No. X2-011 to be effective 5/1/2012.
    Filed Date: 12/6/17.
    Accession Number: 20171206-5110.
    Comments Due: 5 p.m. ET 12/27/17.

    The filings are accessible in the Commission's eLibrary system by
clicking on the links or querying the docket number.
    Any person desiring to intervene or protest in any of the above
proceedings must file in accordance with Rules 211 and 214 of the
Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00
p.m. Eastern time on the specified comment date. Protests may be
considered, but intervention is necessary to become a party to the
proceeding.
    eFiling is encouraged. More detailed information relating to filing
requirements, interventions, protests, service, and qualifying
facilities filings can be found at: http://www.ferc.gov/docs-filing/efiling/filing-req.pdf. For other information, call<PHONE_NUMBER>
(toll free). For TTY, call<PHONE_NUMBER>.

    Dated: December 6, 2017.
Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. 2017-26742 Filed 12-11-17; 8:45 am]
 BILLING CODE 6717-01-P