[Federal Register Volume 80, Number 96 (Tuesday, May 19, 2015)]
[Notices]
[Pages 28721-28733]
[FR Doc No: 2015-12028]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74951; File No. SR-NYSEARCA-2015-38]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change Adopting New Equity Trading Rules Relating to
Trading Sessions, Order Ranking and Display, and Order Execution To
Reflect the Implementation of Pillar, the Exchange's New Trading
Technology Platform

May 13, 2015.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\

notice is hereby given that, on April 30, 2015, 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, II, and III 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\ 15 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 adopt new equity trading rules relating to
Trading Sessions, Order Ranking and Display, and Order Execution to
reflect the implementation of Pillar, the Exchange's new trading
technology platform. The text of the proposed rule change is available
on the Exchange's Web site at www.nyse.com, at the principal office of
the Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    On January 29, 2015, the Exchange announced the implementation of
Pillar, which is an integrated trading technology platform designed to
use a single specification for connecting to the equities and options
markets operated by NYSE Arca and its affiliates, New York Stock
Exchange LLC (``NYSE'') and NYSE MKT LLC (``NYSE MKT''). NYSE Arca
Equities will be the first trading system to migrate to Pillar.\4\ NYSE
Arca Equities trading on Pillar would be an all-electronic price-time
priority equities trading platform.
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    \4\ See Trader Update dated January 29, 2015, available here:
http://www1.nyse.com/pdfs/Pillar_Trader_Update_Jan_2015.pdf.
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    The Exchange will be submitting proposed rule changes to correspond
to the anticipated migration to Pillar, which would be done in phases.
During the first phase, ETP Holders would continue to connect to
existing NYSE Arca gateways to access the Pillar trading platform. In
the second phase, the Exchange will introduce new customer gateways and
connectivity as well as additional order type processing. To implement
the first phase of Pillar migration, the Exchange will be submitting
more than one rule filing. The Exchange will later submit rule filings
to implement the second phase of Pillar migration.
    During the first phase of Pillar implementation, the Exchange would
roll out the new technology platform over a period of time based on a
range of symbols. Because orders entered in symbols not yet migrated to
Pillar would continue to operate under current rules, the Exchange will
keep its current rules, pending complete migration of symbols to Pillar
and retirement of the current trading system, and add new rules that
would be applicable to symbols that trade on the Pillar trading
platform. As proposed, the new rules governing trading on Pillar would
have the same numbering as current rules, but with the modifier ``P''
appended to the rule number. For example, Rule 7.34, governing Trading
Sessions, would remain unchanged and continue to apply to any trading
in symbols on the current trading platform. Proposed Rule 7.34P would
govern Trading Sessions for trading in symbols migrated to the Pillar
platform. Once all symbols have migrated to the Pillar platform, the
Exchange will file a rule proposal to delete rules that are no longer
operative.
    In this filing, the Exchange proposes to adopt new Pillar rules
relating to Trading Sessions (NYSE Arca Equities Rule 7.34 (``Rule
7.34'')), Order Ranking and Display (NYSE Arca Equities Rule 7.36
(``Rule 7.36'')), and Order Execution (NYSE Arca Equities Rule 7.37
(``Rule 7.37'')). As proposed, the new rules would be NYSE Arca
Equities Rules 7.34P (Trading Sessions) (``Rule 7.34P''), 7.36P (Order
Ranking and Display) (``Rule 7.36P''), and 7.37P (Order Execution)
(``Rule 7.37P''). These three rules would set forth the foundation of
the Exchange's equity trading model in Pillar, including the hours of
operation, how orders would be ranked and displayed, and how orders
would be executed.
    As discussed in greater detail below, the Exchange is not proposing
that the core functionality of rules applicable to trading on Pillar
would be different from rules applicable to trading on the current NYSE
Arca equities trading system. However, with Pillar, the Exchange would
introduce new terminology. Further, because the Exchange would operate
both its current trading system for some symbols and the Pillar trading
platform for other symbols, until rollout of Pillar across all symbols
is complete, the Exchange is proposing to add all new rule text for
proposed Rules 7.34P, 7.36P, and 7.37P. Because these rules and related
proposed terminology changes would be the foundation for all other rule
changes that will be proposed in connection with Pillar, the Exchange
believes that filing for these rule changes before other rule changes
will provide the public notice of how Pillar would operate generally.
Proposed Use of ``P'' Modifier
    To reflect how the ``P'' modifier would operate, the Exchange
proposes to add rule text immediately following the reference to ``Rule
7 Equities Trading,'' and before ``Section 1. General Provisions'' that
would provide that rules with a ``P'' modifier would be operative for
symbols that are trading on the Pillar trading platform. As further
proposed, if a symbol is trading on the Pillar trading platform, a rule
with the same number as a rule with a ``P'' modifier would no longer be
operative for that symbol and the Exchange would announce by Trader
Update when symbols are trading on the Pillar trading platform.
    Similarly, the Exchange proposes to add rule text following the
title ``Rule 1 Definitions'' that provides that definitions with a
paragraph designation that includes a ``P'' modifier would be operative
for symbols trading on the Pillar trading platform. A definition with
the same paragraph designation as a definition with a ``P'' modifier
would not be operative for symbols trading on Pillar. Finally, to
provide clarity that definitions that do not have a version with a
``P'' modifier would apply across all symbols, regardless of the
trading platform, the Exchange proposes to state explicitly that
definitions that do not have a companion version with a ``P'' modifier
would continue to be operative for all symbols.
    The Exchange believes that adding these explanations regarding the
``P'' modifier in Exchange rules would provide transparency regarding
which rules and definitions would be operative depending on the trading
platform on which a symbol is trading.

Trading Sessions
    Rule 7.34 governs trading sessions. As set forth in Rule 7.34(a),
the Exchange has three trading sessions:
    (1) the Opening Session, which begins at 1:00:00 a.m. Pacific Time
and concludes at the commencement of the Core Trading Session. The
Opening Auction and Market Order Auction occur during the Opening
Session;
    (2) the Core Trading Session, which begins at 6:30:00 a.m. Pacific
Time or at the conclusion of the Market Order Auction, whichever comes
later, and concludes at 1:00:00 p.m. Pacific Time; and
    (3) the Late Trading Session, which begins following the conclusion
of the Core Trading Session and concludes at 5:00:00 p.m. Pacific Time.
    Proposed Rule 7.34P(a)(1)-(3) would similarly provide for three
trading sessions, but with several proposed differences from Rule
7.34(a):
     First, the Exchange proposes non-substantive differences
in the names of the trading sessions on the Pillar trading platform.
Specifically, for Pillar, the Exchange proposes to call its three
trading sessions the ``Early Trading Session,'' the ``Core Trading
Session,'' and the ``Late Trading Session.'' The Exchange believes that
the use of the term ``Early Trading Session,'' rather than the
``Opening Session,'' better describes when the session occurs, which is
before the Core Trading Session, and therefore would be clearer to
market participants. In addition, the Exchange proposes the auction
that opens the ``Early Trading Session'' would be called the ``Early
Open Auction,'' instead of the ``Opening Auction'' and that the auction
that opens the ``Core Trading Session'' would be called the ``Core Open
Auction'' instead of the ``Market Order Auction.'' The Exchange
believes that the auctions that open the respective sessions should be
named to reflect both the name of the session and that it is an opening
auction for the respective session.
     Second, the Exchange proposes that all time references for
the trading sessions would be to Eastern Time, and would not include
references to seconds.\5\ The Exchange's current rules for trading
sessions use references to Pacific Time. In today's national trading
environment, the Exchange believes that use of Eastern Time would
reduce investor confusion by conforming references to time to how all
other exchanges denote time in their rules. The Exchange similarly
believes that references to seconds in proposed Rule 7.34P are
unnecessary, as none of the other Exchange rules for the beginning and
end of trading sessions use seconds.
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    \5\ The Exchange also proposes to change the time in the
definition of Core Trading Hours, which is defined in Rule 1.1(j),
from Pacific to Eastern Time references.
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     Third, the Exchange proposes that Rule 7.34P(a)(1)
regarding Early Trading Sessions would be more detailed than Rule 7.34
by adding text that is currently in Rule 7.35(a)(1), without any
substantive differences.\6\ Specifically, the Exchange proposes to
include in Rule 7.34P(a)(1) that the Corporation \7\ would begin
accepting orders 30 minutes before the Early Trading Session begins.
Because this rule text concerns when orders may be entered, the
Exchange believes that it should be included in the rule governing
trading sessions for Pillar. Proposed Rule 7.34P(a)(1) would further
provide that the Early Open Auction would begin the Early Trading
Session.
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    \6\ In a separate rule filing, the Exchange will propose Rule
7.35P, which would govern auctions in Pillar.
    \7\ The term ``Corporation'' is defined in Rule 1.1(k) as NYSE
Arca Equities, Inc., as described in the NYSE Arca Equities, Inc.'s
Certification of Incorporation and Bylaws.
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     Fourth, the Exchange proposes to provide that the Core
Open Auction would occur during the Core Trading Session. Rule 7.34(a)
currently provides that the Market Order Auction occurs during the
Opening Session. Because this auction is intended to open trading for
the Core Trading Session,\8\ the Exchange believes it should be
considered part of the Core Trading Session, rather than the Early
Trading Session. The Exchange therefore proposes to specify in proposed
Rule 7.34P(a)(2) that the Core Open Auction would begin the Core
Trading Session. The Exchange further proposes to specify that the Core
Trading Session would end at the conclusion of Core Trading Hours or
the Core Closing Auction, whichever comes later. The proposed cross
reference to Core Trading Hours, which is defined in Rule 1.1(j), takes
into consideration that the Core Trading Session may end earlier than
4:00 p.m. when the Exchange has an early scheduled close, e.g., the day
before Christmas.
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    \8\ Rule 7.35 currently specifies that the Market Order Auction
occurs at 9:30 a.m., which is the same time that the Core Trading
Session begins for securities that do not have an auction.
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     Fifth, the Exchange proposes not to include in proposed
Rule 7.34P the text currently in Rule 7.34 relating to extended Core
Trading Session hours. Rules 7.34(a)(3)(A) and (B) provide that the
Core Trading Session for specified securities concludes at 1:15:00 p.m.
Pacific Time unless otherwise determined by the Corporation and that
the Exchange would maintain on its Web site which securities for which
the Core Trading Session would extend to 1:15:00 p.m. Because the
Exchange does not have any securities for which the Core Trading
Session extends to 1:15:00 p.m. Pacific Time, nor does it plan to
provide for such an extended Core Trading Session for any securities,
the Exchange proposes not to include this provision in proposed Rule
7.34P.
     Finally, the Exchange proposes that text currently found
in Rules 7.34(a)(4), 7.34(a)(5), and 7.34(b) not be included in
proposed Rule 7.34P. Rules 7.34(a)(4) and (5) currently describe how
the Exchange handles trading halts in specified securities that occur
during different trading sessions. The Exchange believes that rule text
relating to halts should be centralized in a single rule and will be
proposing in a separate rule filing to add the text of current Rule
7.34(a)(4) and (5) to proposed Rule 7.18P. Rule 7.34(b) sets forth
Market Maker obligations to enter Q Orders for securities in which they
are registered. The Exchange believes that this topic is not related to
trading sessions directly and that this rule text should be included
with the definition of Q Orders and therefore will be proposing in a
separate rule filing to add the text of current Rule 7.34(b) to
proposed Rule 7.31P.\9\ Because Rule 7.34(a)(4) defines the term
``Derivative Securities Product'' and because that definition would not
be included in proposed Rule 7.34P, the Exchange proposes to add a new
definition to Rule 1.1 to define the terms Derivative Securities
Product and UTP Derivative Securities Product. As proposed, the term
``Derivative Securities Product'' would mean a security that meets the
definition of ``derivative securities product'' in Rule 19b-4(e) under
the Securities Exchange Act of 1934 \10\ and a ``UTP Derivatives
Securities Product'' would mean a Derivative Securities Product that
trades on the Exchange pursuant to unlisted trading privileges.
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    \9\ The Exchange will be submitting a separate rule filing to
propose Rule 7.31P, which would govern orders and modifiers in
Pilar.
    \10\ 17 CFR 240.19b-4(e)
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    The Exchange proposes to include the text of Rule 7.34(c) in
proposed Rule 7.34P(b) with non-substantive differences and to provide
more detail. Rule 7.34(c) provides that any Day Order entered into the
NYSE Arca Marketplace \11\ may remain in effect for

one or more consecutive trading sessions on a particular day and that
for each Day Order entered, the User \12\ must designate for which
trading session(s) the order will remain in effect. Proposed Rule
7.34P(b) would instead provide that any order entered into the NYSE
Arca Marketplace must include a designation for which trading
session(s) the order would remain in effect.
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    \11\ The term ``NYSE Arca Marketplace'' is defined in Rule
1.1(e) as the electronic securities communication and trading
facility designated by the Board of Directors through which orders
of Users are consolidated for execution and/or display.
    \12\ The term ``User'' is defined in Rule 1.1(yy) as any ETP
Holder or Sponsored Participant who is authorized to obtain access
to the NYSE Arca Marketplace pursuant to Rule 7.29.
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    Proposed new Rule 7.34P(b) would also provide that an order would
be eligible to participate only in the designated trading session(s)
and may remain in effect for one or more consecutive trading sessions
on a particular day. The Exchange further proposes to add that unless
otherwise specified, an order designated for a later trading session
would be accepted but not eligible to trade until the designated
trading session begins. For example, if an order is entered at 8:00
a.m. Eastern Time and is designated for the Core Trading Session only,
it would be accepted but would not participate in the Early Trading
Session. As discussed in more detail below, proposed Rule 7.34P(c)
would specify orders that may not be entered either during or in
advance of a designated trading session. In addition, the Exchange
proposes to add that an order designated solely for a trading session
that has already ended would be rejected. For example, an order entered
at 10:00 a.m. Eastern Time that is designated only for the Early
Trading Session would be rejected. The Exchange believes that the
proposed changes would provide transparency in Exchange rules of when
orders may be entered and when orders would be rejected.
    The Exchange also proposes to add in Rule 7.34P(b)(2) and (3) that
an order with a day time-in-force instruction entered before or during
the Early Trading Session would be deemed designated for the Early
Trading Session and the Core Trading Session and that an order with a
day time-in-force instruction entered during the Core Trading session
would be deemed designated for the Core Trading Session. The Exchange
believes that the proposed rule text provides transparency regarding
which sessions during which an order may be eligible to participate.
    The Exchange proposes to describe the processes currently set forth
in Rule 7.34(d) in proposed Rule 7.34P(c). Rule 7.34(d) describes which
orders are permitted in each session. The Exchange proposes to revise
how this topic is described in proposed Rule 7.34P(c) to provide
generally that orders are eligible to participate in a session, unless
otherwise provided in the rule. Accordingly, rule text in Rule 7.34(d)
that specifies order types that are eligible to participate in a
particular session would not be included in new Rule 7.34P because the
proposed new text would make it unnecessary to specify the order types
eligible to participate in a particular session. Those order types that
would not be eligible to participate in each of the Exchange's three
trading sessions are described below.
    With respect to the Early Trading Session, the Exchange proposes in
new Rule 7.34P(c)(1) to provide that, unless otherwise specified in
proposed paragraphs (c)(1)(A)--(E) of the new rule, orders and
modifiers defined in Rule 7.31P that have been designated for the Early
Trading Session would be eligible to participate in the Early Trading
Session. The Exchange believes that the proposed rule text makes clear
that unless specified in paragraphs (c)(1)(A)-(E) of new Rule 7.34P,
all orders and modifiers in Rule 7.31P, if designated for the Early
Trading Session, would be eligible to participate in the Early Trading
Session.
    Unlike under current rules, the Exchange proposes that Tracking
Orders would be eligible to participate in the Early Trading Session on
the Pillar trading platform. Because the Exchange routes orders during
the Early Trading Session and because Tracking Orders are intended to
be passive liquidity on the Exchange to interact with an order before
it is routed, the Exchange believes that Tracking Orders should be
available in the Early Trading Session. Accordingly, rule text from
Rule 7.34(d)(1)(C) would not be included in new Rule 7.34P(c)(1).
    The Exchange proposes that the following orders and modifiers in
Rule 7.31P would not be eligible to participate in the Early Trading
Session:
     Proposed Rule 7.34P(c)(1)(A) would provide that Market
Orders, Q Orders, and Pegged Orders would not be eligible to
participate in the Early Trading Session, which is current
functionality. The Exchange further proposes to specify that any Market
Orders, Q Orders, and Pegged Orders that include a designation for the
Early Trading Session would be rejected. Such orders would be rejected
if they also include a designation for another trading session; the
designation for the Early Trading Session whether alone or with another
designation would result in a rejection of the order. The Exchange
further proposes to add that Market Pegged Orders entered before or
during the Early Trading Session would be rejected regardless of the
session designated for the order.\13\ For example, a Market Order, Q
Order, or Primary Pegged Order designated for the Core Trading Session
only that is entered at 8:00 a.m. Eastern Time would be accepted, but a
Market Pegged Order designated for the Core Trading Session only
entered at the same time would be rejected.
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    \13\ As set forth in proposed Rule 7.34P(b), orders that are
entered during the Early Trading Session and designated for a later
session only would be accepted and become eligible to trade once the
designated trading session begins.
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     Proposed Rule 7.34P(c)(1)(B) would specify that Limit
Orders designated IOC and Cross Orders would not be eligible to
participate in the Early Open Auction and would be rejected if entered
before the Early Open Auction concludes. The reference to Limit Orders
designated IOC includes any order with an IOC instruction, including
MPL Orders. Limit Orders designated IOC and Cross Orders are not
currently eligible to participate in auctions, accordingly, this
proposed rule change does not represent new functionality. However, the
Exchange believes that the proposed change promotes transparency in
Exchange rules regarding when an order would be accepted or rejected.
     Proposed Rule 7.34P(c)(1)(C) would specify that Limit
Orders designated IOC and Cross Orders entered before or during the
Early Trading Session and designated for the Core Trading Session only
would be rejected if entered before the Core Open Auction concludes.
The Exchange believes that this proposed rule would provide
transparency because orders designated IOC must be eligible for an
immediate execution and are not eligible for auctions, and an IOC order
designated with a later trading session is by its terms inconsistent.
     Proposed Rule 7.34P(c)(1)(D) would provide that for
securities that are not eligible for an auction on the Exchange, Market
Orders designated for Core Trading Session and Auction-Only Orders
would be routed directly to the primary listing market on arrival. This
proposed treatment of Market Orders and Auction-Only Orders in
securities that are not eligible for an auction on the Exchange would
be different from current functionality.\14\ Currently,

Market Orders or Auction-Only Orders are routed to the primary listing
market on arrival only if they include a ``Primary Only'' order
designation. The Exchange proposes that on the Pillar trading platform,
during the Early Trading Session, a Market Order or Auction-Only Order
in a security that is not eligible for an auction on the Exchange would
be routed to the primary listing market regardless of whether it
includes a Primary Only designation. The Exchange believes that this
proposed functionality would be consistent with the expectations of a
User with respect to such orders, which would not be eligible for an
execution on the Exchange. The Exchange proposes to further provide
that any order routed directly to the primary listing market on
arrival, which includes the above-described orders and Primary Only
Orders, would be cancelled if that market is not accepting orders.
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    \14\ Proposed Rule 7.34P(c)(1)(D) would also represent a change
to current Exchange functionality regarding MOC Orders and LOC
Orders. Currently, the Exchange does not accept such orders before
9:30 a.m. Eastern Time. On the Pillar trading platform, the Exchange
would accept such orders during the Early Trading Session, and if
for a security that is not eligible for an auction on the Exchange,
route such orders to the primary listing market if such market is
accepting orders.
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     Proposed Rule 7.34P(c)(1)(E) would provide that MOO
Orders, MOC Orders, LOC Orders, and Primary Only Orders designated for
the Early Trading Session would be rejected. This represents current
functionality. LOO Orders may be designated for the Early Trading
System in order to participate in a reopening auction following a
trading halt. LOO Orders in securities not eligible for an auction on
the Exchange that are designated for an Early Trading Session would be
routed to the primary listing market, consistent with proposed Rule
7.34P(c)(1)(D) . The Exchange proposes to include this text in proposed
Rule 7.34P in order to provide transparency of when an order would be
rejected.
    With respect to the Core Trading Session, the Exchange proposes in
new Rule 7.34P(c)(2) to provide that, unless otherwise specified in
proposed paragraphs (c)(2)(A)-(B) of the new rule, orders and modifiers
defined in Rule 7.31P and 7.44P that have been designated for the Core
Trading Session would be eligible to participate in the Core Trading
Session.\15\ The Exchange believes that the proposed rule text makes
clear that, unless specified in paragraphs (c)(2)(A)-(B) of new Rule
7.34P, all orders and modifiers in Rule 7.31P and 7.44P, if designated
for the Core Trading Session, would be eligible to participate in the
Core Trading Session. The proposed exceptions to the general rule would
be:
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    \15\ The Exchange notes that orders and modifiers described in
Rule 7.44 governing the Retail Liquidity Program (``RLP'') are
eligible to participate in the Core Trading Session only. The
Exchange will submit a separate rule filing to adopt Rule 7.44P to
govern RLP in Pillar.
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     Proposed Rule 7.34P(c)(2)(A) would provide that Market
Orders in securities that are not eligible for the Core Open Auction
would be routed to the primary listing market until the first opening
print of any size on the primary listing market or 10:00 a.m. Eastern
Time, whichever is earlier. This proposed rule text is based on current
Rule 7.35(c), which states that for all exchange-listed securities for
which the Exchange does not conduct a Market Order Auction, ``the
Corporation will route all Market Orders to the primary market until
the first opening print on the primary market.'' This current rule
makes clear that the Exchange refrains from processing Market Orders
until the primary listing market has printed a transaction, and not
just opened for trading based on an opening quote. Because this rule
relates to how orders are treated during a trading session, the
Exchange believes that it is more appropriately included in proposed
Rule 7.34P(c) than in a rule governing auctions.
    In moving the rule text, the Exchange is proposing two substantive
differences. First, to specify that the first opening print may include
an odd-lot transaction, the Exchange proposes to provide in Rule
7.34P(c)(2)(A) that Market Orders in securities that are not eligible
for the Core Open Auction would be routed to the primary listing market
until the first print of any size on the primary listing market. The
Exchange believes it is appropriate to include an odd-lot transaction
print because such a transaction indicates that trading has begun on
the primary listing market. Second, the Exchange proposes to provide
for an outside time frame for when the Exchange would stop routing
Market Orders to the primary listing market and begin processing those
orders on the Exchange. As proposed, the Exchange would continue
routing Market Orders to the primary listing market until the first
print of any size on such market or 10:00 a.m. Eastern Time, whichever
is earlier. The Exchange believes that if the primary listing market
has not opened for trading by 10:00 a.m. Eastern Time and has not
halted the security, the Exchange should begin processing Market Orders
in all securities. The proposed time of 10:00 a.m. Eastern Time is
based on NYSE Rule 123D and NYSE MKT Rule 123D--Equities, which provide
for delayed opening procedures for NYSE- and NYSE MKT-listed
securities. Specifically, under those rules, a security is considered
in a delayed opening if it is not open by 10:00 a.m. Eastern Time.
     Proposed Rule 7.34P(c)(2)(B) would provide that Auction-
Only Orders in securities that are not eligible for an auction on the
Exchange would be accepted and routed directly to the primary listing
market. This proposed rule text is a continuation of the treatment of
such orders as described in proposed Rule 7.34P(c)(1)(D) in that during
the Core Trading Session, the Exchange would continue to accept and
route such orders directly to the primary listing market. This proposal
represents a change from current practice, as Rule 7.31(t) currently
provides that the Exchange does not route Auction-Only orders to other
exchanges. Instead, the Exchange currently rejects Auction-Only Orders
in securities that are not eligible for an auction on the Exchange,
unless they include a Primary Only Order designation. In Pillar, the
Exchange would accept such orders and route them to the primary listing
market.\16\
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    \16\ Because the treatment of Auction-Only Orders in securities
that are not eligible for any auction on the Exchange would be
covered in proposed Rule 7.34P, the Exchange would propose that new
Rule 7.31P not include this same topic.
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    With respect to the Late Trading Session, the Exchange proposes in
new Rule 7.34P(c)(3) to provide that unless otherwise specified in
proposed paragraphs (c)(3)(A)-(C) of the new rule, orders and modifiers
defined in Rule 7.31P that have been designated for the Late Trading
Session would be eligible to participate in the Late Trading Session.
The Exchange believes that this proposed rule text makes clear that
unless specified in paragraphs (c)(3)(A)-(C) of new Rule 7.34P, all
orders and modifiers in Rule 7.31P, if designated for the Late Trading
Session, would be eligible to participate in the Late Trading Session.
    Unlike under current rules, the Exchange proposes that Tracking
Orders would be eligible to participate in the Late Trading Session, as
they would be in the Early Trading Session, on the Pillar trading
platform. Because the Exchange routes orders during the Late Trading
Session and because Tracking Orders are intended to be passive
liquidity on the Exchange to interact with an order before it is
routed, the Exchange believes that Tracking Orders should be available
in the Late Trading Sessions. Accordingly, rule text from current Rule
7.34(d)(3)(C) would not be included in new Rule 7.34P(c)(3).
    The Exchange proposes that the following orders and modifiers in
Rule 7.31P would not be eligible to participate in the Late Trading
Session:

     Proposed Rule 7.34P(c)(3)(A) would provide that Market
Orders, Q Orders, and Pegged Orders would not be eligible to
participate in the Late Trading Session, which is current
functionality. The rule would further provide that Market Orders, Q
Orders, and Pegged Orders that include a designation for the Late
Trading Session would be rejected. For example, if a Market Order, Q
Order, or Pegged Order were entered during the Core Trading Session and
designated for both the Core and Late Trading Session, because it
includes a designation for the Late Trading Session, such order would
be rejected. The Exchange believes that this proposed rule text
provides transparency in Exchange rules of when an order would be
accepted or rejected.
     Proposed Rule 7.34P(c)(3)(B) would provide that orders
that route directly to the primary listing market on arrival would be
cancelled if that market is not accepting orders, which is current
functionality.
     Proposed Rule 7.34P(c)(3)(C) would provide that MOO
Orders, MOC Orders, LOC Orders, and Primary Only Orders designated for
the Late Trading Session would be rejected. This represents current
functionality. LOO Orders may be designated for the Late Trading System
in order to participate in a reopening auction following a trading
halt. LOO Orders in securities not eligible for an auction on the
Exchange that are designated for an Early Trading Session would be
routed to the primary listing market. The Exchange proposes to include
this text in proposed Rule 7.34P in order to provide transparency of
when an order would be rejected.
    Proposed Rule 7.34P(d) regarding customer disclosures is based on
Rule 7.34(e) with non-substantive differences to conform terminology
with the proposed changes to new Rule 7.34P, including use of the term
``Early Trading Session'' instead of ``Opening Session,'' ``Core Open
Auction'' instead of ``Market Order Auction,'' and ``Limit Order''
instead of ``Limited Price Order.''
    Finally, proposed Rule 7.34P(e) is based on Rule 7.34(f) without
any substantive differences and would provide that trades on the NYSE
Arca Marketplace executed and reported outside of the Core Trading
Session would be designated as .T trades.
Order Ranking and Display
    Rule 7.36 governs order ranking and display for the current Arca
trading system. The rule provides that the NYSE Arca Marketplace shall
display to Users and other market participants all non-marketable limit
orders in the Display Order Process. The rule further provides that the
NYSE Arca Marketplace will also disseminate current consolidated
quotation/last sale information, and such other market information as
may be available from time to time pursuant to agreement between the
Corporation and other market centers.
    Rule 7.36(a) sets forth that orders of Users are ranked and
maintained in the Display Order Process and/or the Working Order
Process of the NYSE Arca Book \17\ according to price-time priority,
such that within each price level, orders are organized by the time of
entry in the manner described in the rule.
---------------------------------------------------------------------------

    \17\ The term ``NYSE Arca Book'' is defined in Rule 1.1(a) as
the NYSE Arca Marketplace's electronic file of orders, which contain
all of the User's orders in each of the Display Order, Working
Order, and Tracking Order Processes.
---------------------------------------------------------------------------

    Rule 7.36(a)(1) describes the Display Order Process and Rule
7.36(a)(2) describes the Working Order Process. Rule 7.36(a)(3) sets
forth that if an order has been modified in size, the order retains
priority if the modification involves a decrease in the size of the
order, but if the modification increases the size of the order or
changes the price, the order will be treated as a new order and receive
a new time priority. Rule 7.36(b) provides that, except as provided in
Rule 7.7, all orders displayed in the Display Order Process are
displayed on an anonymous basis. Finally, Rule 7.36(c) provides that
the best-ranked displayed orders to buy (sell) in the NYSE Arca Book
and the aggregate size of such orders are collected and made available
to quotation vendors for dissemination pursuant to Rule 11Ac1-1 under
the Exchange Act. The rule further provides that if non-marketable odd-
lot sized orders can be aggregated to equal at least a round lot, such
odd-lot sized orders will be displayed as the best ranked displayed
orders to sell (buy) at the least aggressive price at which such odd-
lot sized orders can be aggregated to equal at least a round lot.
    Proposed Rule 7.36P would describe for the Pillar trading platform
order ranking and display of orders, without any substantive
differences from Rule 7.36. As discussed in detail below, the Exchange
believes that the proposed new rule text provides transparency with
respect to how the Exchange's price-time priority model would operate
through the use of new terminology applicable to all orders on the
Pillar trading platform.
    Rule 7.36P(a) would set forth definitions for purposes of all of
Rule 7 Equities Trading on the Pillar trading platform, including Rule
7.37P (Order Execution and Routing), described below. The Exchange
believes that these proposed definitions would provide transparency
regarding how the Exchange operates, and would serve as the foundation
for amendments to orders and modifiers that will be in proposed Rule
7.31P.
     Proposed Rule 7.36P(a)(1) would define the term ``display
price'' to mean the price at which a Limit Order is displayed, which
may be different from the limit price or working price of the order.
For example, Rule 7.31 provides for order types that may be displayed
at prices that are different from the limit price, such as a PNP Blind
Order.\18\ The Exchange proposes to define the term ``display price''
in Pillar to explain these existing concepts uniformly in Exchange
rules applicable to trading on the Pillar trading platform.
---------------------------------------------------------------------------

    \18\ See Rule 7.31(e)(4). The Exchange notes that in connection
with Pillar, the Exchange will be renaming the PNP Blind Order as an
``Arca Only Order,'' which will be proposed in a separate rule
filing to adopt new Rule 7.31P. See Trader Update dated March 2,
2015, available here: https://www.nyse.com/publicdocs/nyse/markets/nyse/Pillar_Trader_Update_Mar_2015.pdf.
---------------------------------------------------------------------------

     Proposed Rule 7.36P(a)(2) would define the term ``limit
price'' to mean the highest (lowest) specified price at which a Limit
Order to buy (sell) is eligible to trade. The limit price is designated
by the User. As noted in the proposed definitions of display price and
working price, the limit price designated by the User may differ from
the price at which the order would be displayed or eligible to trade.
     Proposed Rule 7.36P(a)(3) would define the term ``working
price'' to mean the price at which an order is eligible to trade at any
given time, which may be different from the limit price or display
price of an order. The new term ``working price'' identifies for all
orders the price at which an order is eligible to trade at any given
time. Some exchanges refer to this concept as the price at which an
order is ``ranked.'' \19\ The Exchange believes that the term ``working
price'' would provide clarity regarding the price at which an order may
be executed at any given time. Specifically, the Exchange believes that
use of the term ``working'' denotes that this is a price that is
subject to change, depending on circumstances. The Exchange will be
using this term in connection with orders and modifiers when it files a
separate rule filing to adopt Rule 7.31P.
---------------------------------------------------------------------------

    \19\ See, e.g., BATS Exchange, Inc. Rule 11.9(g)(1)(A)
(referring to where an order is ``ranked'' as the price of an
order).
---------------------------------------------------------------------------

     Proposed Rule 7.36P(a)(4) would define the term ``working
time'' to mean the effective time sequence assigned to

an order for purposes of determining its priority ranking. The Exchange
proposes to use the term ``working time'' in its rules for trading on
the Pillar trading platform instead of terms such as ``time sequence''
or ``time priority,'' which are used in rules governing trading on the
Exchange's current system. The Exchange believes that use of the term
``working'' denotes that this is a time assigned to an order for
purpose of ranking and is subject to change, depending on
circumstances.
    Proposed Rule 7.36P(b) would govern the display of non-marketable
Limit Orders on the Pillar trading system and is intended to be
comparable to the preamble to Rule 7.36, without any substantive
differences. As proposed, the Exchange would display all non-marketable
Limit Orders, unless the order or modifier instruction specifies that
all or a portion of the order is not to be displayed.
    The Exchange proposes to define in proposed Rule 7.36P(b)(1) what
it means for an order to be displayed for ranking purposes. As
proposed, an order would be considered displayed for ranking purposes
if the price, side, and size of the order are disseminated via a market
data feed, which includes a proprietary market data feed of the
Exchange. As further proposed, odd-lot sized Limit Orders and the
displayed portion of Reserve Orders would be considered displayed for
ranking purposes. This proposed rule text is intended to provide
transparency in Exchange rules regarding which orders are considered
displayed for ranking purposes, and therefore eligible to be considered
Priority 2--Display Orders (described below). Specifically, odd-lot
sized orders are displayed on the Exchange's proprietary data feed and
would be displayed on the public feed if aggregated to equal a round
lot or more would thus be considered ``displayed'' orders for purposes
of priority ranking.
    Proposed Rule 7.36P(b)(2) would be comparable to Rule 7.36(b)
without any substantive differences and would provide that except as
otherwise permitted by Rule 7.7,\20\ all non-marketable displayed Limit
Orders would be displayed on an anonymous basis. The Exchange proposes
not to include reference to the Display Order Process in Rule
7.36P(b)(2) because, as discussed above, the Exchange is not proposing
to use that terminology in Pillar.
---------------------------------------------------------------------------

    \20\ Rule 7.7 provides that bids and offers disseminated by the
Exchange will not include an ETP Holder's identify unless the ETP
Holder affirmatively elects to disclosed its identify.
---------------------------------------------------------------------------

    Finally, proposed Rule 7.36P(b)(3) would be comparable to Rule
7.36(c) regarding dissemination, without any substantive differences.
The Exchange proposes to use the term ``will'' in Proposed Rule
7.36P(b)(3) instead of ``shall.'' In addition, the Exchange would not
include in proposed Rule 7.36P rule text from the second sentence of
the preamble to Rule 7.36. The Exchange is a participant in the CQ Plan
and CTA Plan for Tape A- and B-listed securities and a participant in
the Nasdaq UTP Plan for Tape C-listed securities. The respective
governing documents of those plans set forth the Exchange's obligations
regarding dissemination of quotes and last-sale information and thus,
the Exchange does not believe it is necessary to duplicate a subset of
those requirements in its rules. Finally, the Exchange proposes to cite
to the governing federal rule by referencing Rule 602 of Regulation NMS
\21\ instead of Rule 11Ac1-1 under the Exchange Act, which was
superseded by Regulation NMS.
---------------------------------------------------------------------------

    \21\ 17 CFR 242.602.
---------------------------------------------------------------------------

    Proposed Rule 7.36P(c) would describe the Exchange's general
process for ranking orders and would be comparable to the text
immediately following Rule 7.36(a), without any substantive
differences. As proposed, Rule 7.36P(c) would provide that all non-
marketable orders would be ranked and maintained in the NYSE Arca Book
according to price-time priority in the following manner: (1) Price;
(2) priority category; (3) time; and (4) ranking restrictions
applicable to an order or modifier condition. Accordingly, orders would
be first ranked by price. Next, at each price level, orders would be
assigned a priority category. Orders in each priority category would be
required to be exhausted before moving to the next priority category.
Within each priority category, orders would be ranked by time. These
general requirements for order ranking are applicable to all orders,
unless an order or modifier has a specified exception to this ranking
methodology, as described in more detail below. The Exchange is
proposing this ranking description instead of using the concepts of a
Display Order Process, Working Order Process, and Tracking Order
Process in Rule 7.36. However, substantively there would be no
difference in how the Exchange ranks orders on the Pillar trading
platform from how it ranks orders in in the current trading system. For
example, a non-displayed order would always be ranked after a displayed
order at the same price, even if the non-displayed order has an earlier
working time.
    To provide transparency regarding the Exchange's ranking process,
the Exchange proposes to set forth in Rule 7.36P additional detail
regarding each step. Proposed Rule 7.36P(d) would describe how orders
are ranked based on price. Specifically, as proposed, all orders would
be ranked based on the working price of an order. Orders to buy would
be ranked from highest working price to lowest working price and orders
to sell would be ranked from lowest working price to highest working
price. The rule would further provide that if the working price of an
order changes, the price priority of an order would change. This price
priority is current functionality, but the new rule would use the
proposed term ``working price.'' The Exchange believes the proposed
rule text provides transparency regarding the price-ranking process at
the Exchange.
    Proposed Rule 7.36P(e) would describe the proposed priority
categories for ranking purposes. As proposed, at each price point, all
orders would be assigned a priority category. If at a price point there
are no orders in a priority category, the next category would have
first priority. The proposed rules applicable to the Pillar trading
platform would not use the terms ``Display Order Process,'' ``Working
Order Process'' and ``Tracking Order Process'' for describing priority
categories. The Exchange does not believe that Rule 7.36P, which sets
forth the general rule regarding ranking, should provide specifics for
one or more order types and therefore the Exchange will address
separately in new Rule 7.31P governing orders and modifiers which
priority category correlates to order types and modifiers. Accordingly,
details regarding which proposed priority categories would be assigned
to the display and reserve portions of Reserve Orders, which is in Rule
7.36, will be addressed in new Rule 7.31P and therefore not be included
in proposed Rule 7.36P, except as described below.
    The proposed priority categories would be:
     Proposed Rule 7.36P(e)(1) would specify ``Priority 1--
Market Orders,'' which provides that unexecuted Market Orders would
have priority over all other same-side orders with the same working
price. This proposed priority is the same as current Exchange priority
rules under which resting Market Orders have priority over other orders
at

the same price.\22\ Circumstances when an unexecuted Market Order would
be eligible to execute against an incoming contra-side order include
when a Market Order has exhausted all interest at the NBBO and is
waiting for an NBBO update before executing again, pursuant to Rule
7.31(a), or when a Market Order is held unexecuted because it has
reached a trading collar, pursuant to Rule 7.31(a)(3)(A). In such
circumstances, the unexecuted Market Order(s) would have priority over
all other resting orders at that price.
---------------------------------------------------------------------------

    \22\ This priority is currently specified in Rule 7.16(f)(viii).
---------------------------------------------------------------------------

     Proposed Rule 7.36P(e)(2) would specify ``Priority 2--
Display Orders.'' This proposed priority category would replace the
``Display Order Process.'' As proposed, non-marketable Limit Orders
with a displayed working price would have second priority. For an order
that has a display price that differs from the working price of the
order, if the working price is not displayed, the order would not be
ranked Priority 2 at the working price.
     Proposed Rule 7.36P(e)(3) would specify ``Priority 3--Non-
Display Orders.'' This priority category would be used in Pillar rules,
rather than the ``Working Order Process.'' As proposed, non-marketable
Limit Orders for which the working price is not displayed, including
the reserve interest of Reserve Orders, would have third priority.
     Proposed Rule 7.36P(e)(4) would specify ``Priority 4--
Tracking Orders.'' This priority category would replace the ``Tracking
Order Process,'' as discussed in further detail below in connection
with proposed Rule 7.37P. As proposed, Tracking Orders would have
fourth priority.
    Proposed Rule 7.36P(f) would set forth that within each priority
category, orders would be ranked based on time priority.
     Proposed Rule 7.36P(f)(1) would provide that an order is
assigned a working time based on its original entry time, which is the
time an order is first placed on the NYSE Arca Book. This proposed
process of assigning a working time to orders is current functionality
and is substantively the same as current references to the ``time of
original order entry'' found in several places in Rule 7.36. To provide
transparency in Exchange rules, the Exchange further proposes to
include in proposed Rule 7.36P(f) how the working time would be
determined for orders that are routed. As proposed:
    [cir] Proposed Rule 7.36P(f)(1)(A) would specify that an order that
is fully routed to an Away Market \23\ on arrival would not be assigned
a working time unless and until any unexecuted portion of the order
returns to the NYSE Arca Book. The Exchange notes that this is the
current process for assigning a working time to an order and proposes
to include it in Exchange rules to provide transparency regarding what
is considered the working time of an order that was fully routed on
arrival.
---------------------------------------------------------------------------

    \23\ The Exchange proposes Rule 1.1(ffP), which would define the
term ``Away Market.'' The proposed definition is based on the
existing definition of ``NOW Recipient,'' which is a term that the
Exchange would not be using in Pillar. For Pillar, the proposed
definition of ``Away Market'' would reference the term ``alternative
trading system'' instead of ECN.
---------------------------------------------------------------------------

    [cir] Proposed Rule 7.36P(f)(1)(B) would specify that for an order
that is partially routed to an Away Market on arrival, the portion that
is not routed would be assigned a working time. If any unexecuted
portion of the order returns to the NYSE Arca Book and joins any
remaining resting portion of the original order, the returned portion
of the order would be assigned the same working time as the resting
portion of the order. If the resting portion of the original order has
already executed and any unexecuted portion of the order returns to the
NYSE Arca Book, the returned portion of the order would be assigned a
new working time. This process for assigning a working time to
partially routed orders is the same as currently used by the Exchange.
The Exchange proposes to include this detail in Exchange rules to
provide transparency regarding what is considered the working time of
an order.
     Proposed Rule 7.36P(f)(2) would provide that an order
would be assigned a new working time any time the working price of an
order changes. This proposed rule text would be based on the rule text
in Rule 7.36(a)(3), without any substantive differences. A change to
the working price could be because of a User's instruction or because
the order or modifier has a price that can change based on a reference
price, such as an MPL Order, which is priced based on the PBBO.
     Proposed Rule 7.36P(f)(3) would provide that an order
would be assigned a new working time if the size of the order increases
and that an order would retain its working time if the size of the
order is decreased. This proposed rule text would be based on rule text
in the first and second sentences of Rule 7.36(a)(3), without any
substantive differences.
     Proposed Rule 7.36P(f)(4) would provide that an order
retains its working time if the order marking is changed from: (A) Sell
to sell short; (B) sell to sell short exempt; (C) sell short to sell;
(D) sell short to sell short exempt; (E) sell short exempt to sell; and
(F) sell short exempt to sell short. This rule text would use for the
Pillar trading platform rules the same rule text as in Rule
7.16(f)(viii), without any substantive differences. The Exchange
proposes to include the text from Rule 7.16(f)(viii) regarding order
priority when changing order marking to Rule 7.36P to consolidate
ranking in a single rule.
    Proposed Rule 7.36P(g) would specify that the Exchange would
enforce ranking restrictions applicable to specified order or modifier
instructions. These order and modifier instructions would be identified
in proposed new Rules 7.31P and 7.44P, which the Exchange will submit
in a rule filing prior to implementing the Pillar trading platform.
    In addition, the Exchange proposes a definition in Rule 1.1(aP) of
NYSE Arca Book that would be applicable to the Pillar rules. The
proposed definition would differ from the current definition of NYSE
Arca Book in Rule 1.1(a) in that it would not include references to the
terms ``Display Order Process,'' ``Working Order Process,'' and
``Tracking Order Process,'' which as discussed above, are terms that
will not be used in Pillar. As proposed, new Rule 1.1(aP) would provide
that the term ``NYSE Arca Book'' refers to the NYSE Arca Marketplace's
electronic file of orders, which contains all orders entered on the
NYSE Arca Marketplace.
Order Execution and Routing
    Current Rule 7.37, titled ``Order Execution,'' governs order
execution and routing at the Exchange. The preamble to the rule
provides that like-priced orders, bids and offers shall be matched for
execution following steps 1 through 4 of the rule, provided, however,
for an execution to occur in any Order Process, the price must be equal
to or better than (1) the PBBO, in the case of a Limit Order or Q Order
or (2) the NBBO in the case of an Inside Limit Order, a Pegged Limit
Order, or a Market order. If such an order is not executable within
those parameters, the rule provides that it may be routed to away
markets as provided in Rule 7.37(d).
    The rule then sets forth steps 1 through 4. Step 1 is the Display
Order Process, which provides that incoming orders are first matched
for execution against other orders in the Display Order process. The
rule provides further specificity regarding how certain orders are
ranked. The rule also sets forth that the size of an incoming Reserve
Order

includes both the displayed and reserve size and the size of the
portion of the Reserve Order resident in the Display Order Process is
equal to its displayed size. If an incoming marketable order is not
executed in its entirety, the remaining part of the order is routed to
the ``Working Order'' process. The rule further provides that an
incoming order that is not marketable enters the Working Order Process
to execute against any Discretionary Orders at or better than the NBBO.
    Step 2 is the Working Order Process, which provides that incoming
marketable orders are matched against orders in the Working Order
process by the order of ranking of the orders in the Working Order
Process. The rule sets forth how specified orders, such as
Discretionary Orders, interact within the Working Order Process. The
rule further provides that if the incoming marketable order has not
been executed in its entirety, the remaining portion of the order shall
be routed to the Tracking Order Process.
    Step 3 is the Tracking Order Process, which is currently available
during Core Trading Hours only. In the Tracking Order Process, if an
order that is eligible to route to an away market has not been executed
in its entirety under Steps 1 through 2, the NYSE Arca Marketplace
shall match and execute any remaining part of such order in the
Tracking Order Process in time/price priority.
    Step 4 sets forth the Exchange's process for routing away and
specifies certain orders that are not eligible to be routed. For orders
that are eligible to be routed, the rule specifies that if the order is
designated as a Market, Inside Limit, or Pegged Order, the Exchange
shall utilize all available quotes in the routing determination, or if
the order is designated as a Limit Order, the Exchange shall utilize
available Protected Quotations in the routing determination. The rule
sets forth additional detail that orders will be routed as Intermarket
Sweep Orders (``ISO'') and any remaining portion of the order will be
ranked and displayed in the NYSE Arca Book pursuant to Rule 7.36.
    The rule further provides that an order that is routed away shall
remain outside the NYSE Arca Marketplace for a prescribed period of
time and may be executed in whole or in part subject to the applicable
trading rules of the relevant market center or market participant and
that when an order remains outside the NYSE Arca Marketplace, it will
have no time standing relative to other orders received from Users at
the same price that may be executed against the NYSE Arca Book. The
rule also provides that when an order is outside the NYSE Arca
Marketplace, it will not have time standing in the NYSE Arca Book.
Finally, with respect to routing, the rule provides that for an order
that is eligible to route away, Users may instruct NYSE Arca to bypass
any market centers that are not posting Protected Quotations within the
meaning of Regulation NMS.
    Rule 7.37(e), (f), and (g) set forth how the Exchange operates
consistent with Regulation NMS for locking and crossing quotations and
specified exceptions to Regulation NMS, including the self-help
exception; ISO Exception; single price openings, reopenings, and
closing transactions; benchmark trades; stopped orders; and the
contingent order exemption.
    Commentary .01 to Rule 7.37 sets forth the Exchange's use of data
feeds for the handling, execution, and routing of orders, as well as
for regulatory compliance.
    The Exchange proposes Rule 7.37P to describe the order execution
and routing rules for the Pillar trading platform. Proposed Rule 7.37P
would not be substantively different from Rule 7.37. The Exchange
proposes that the title for new Rule 7.37P would be ``Order Execution
and Routing.'' The title of Rule 7.37 is ``Order Execution.'' The
Exchange believes that because Rule 7.37P, like Rule 7.37, would
include the Exchange's routing procedures, referencing to ``Routing''
in the rule's title would provide additional transparency in Exchange
rules regarding what topics would be covered in new Rule 7.37P.
    Proposed Rule 7.37P(a) and its subsections would set forth the
Exchange's order execution process and would cover the same subject as
the preamble to Rule 7.37, without any substantive differences. As
proposed, an incoming marketable order would be matched for execution
against contra-side orders in the NYSE Arca Book according to the
price-time priority ranking of the resting orders, subject to specified
parameters. Proposed Rule 7.37P(a)(1) would provide that orders that
are routed to an Away Market on arrival would not be assigned a working
time or be matched for execution on the NYSE Arca Book. This provision
would apply to orders that the Exchange routes based on the time an
order is entered, e.g., a Market Order in a security that is not
eligible for an auction on the Exchange that is entered during the
Early Trading Session, or an order with an instruction to route
directly to the primary market on arrival, e.g., a Primary Only Order.
The Exchange believes that the proposed rule provides transparency that
an order that is intended to route on arrival would not be subject to
order execution at the Exchange.
    Proposed Rule 7.37P(a)(2) would provide that, unless an order
qualifies for an exception to the Order Protection Rule in Rule 611 of
Regulation NMS,\24\ orders will not trade at prices that would trade
through a protected quotation.\25\ Proposed Rule 7.37P(a)(3) would
provide that Limit Orders would be executed at prices equal to or
better than the PBBO and proposed Rule 7.37P(a)(4) would provide that
Market Orders and Inside Limit Orders would be executed at prices equal
to or better than the NBBO. The proposed rule for the Pillar trading
platform is based on existing requirements as set forth in the preamble
to Rule 7.37 and is consistent with the order processing of Market
Orders, Limit Orders, and Inside Limit Orders as set forth in Rule
7.31.
---------------------------------------------------------------------------

    \24\ 17 CFR 242.611.
    \25\ The term ``trade through'' is defined in Rule 1.1(fff) as
the purchase or sale of an NMS stock during regular trading hours,
either as principal or agent, at a price that is lower than a
Protected Bid or higher than a Protected Offer. The term ``protected
quotation'' is defined in Rule 1.1(eee) as a quotation that is a
Protected Bid or a Protected Offer, and those terms are defined in
the rule as well.
---------------------------------------------------------------------------

    As discussed above, the Exchange proposes to eliminate the
terminology associated with the Display Order Process, Working Order
Process, and Tracking Order Process. Therefore, similar to proposed
Rule 7.36P, the Exchange would not include these terms in new Rule
7.37P. Moreover, the Exchange does not believe that it is necessary to
restate in new Rule 7.37P the Exchange's ranking process, which would
be set forth in proposed Rule 7.36P. In addition, consistent with the
Exchange's proposed approach to new Rule 7.34P and 7.37P, the Exchange
proposes to eliminate, where feasible, reference to specific order
types and instead state the Exchange's general order execution
methodology. Any exceptions to such general requirements would be set
forth in connection with specific order or modifier definitions in
proposed Rule 7.31P. Accordingly, the Exchange will not include in new
Rule 7.37P the process currently referred to as ``Step 3'' and instead,
details regarding how Tracking Orders would operate would be included
in proposed Rule 7.36P(e)(3), as discussed above regarding ranking
priority assigned to Tracking Orders, and new Rule 7.31P.
    Proposed Rule 7.37P(b) would set forth the Exchange's order routing
process and is intended to cover the same subject as Rule 7.37(d),
which is

currently referred to as ``Step 4'' in order processing, without any
substantive differences. Proposed Rule 7.37P(b) would provide that
unless an order has an instruction not to route, after being matched
for execution with any contra-side orders in the NYSE Arca Book
pursuant to proposed Rule 7.37P(a), marketable orders would be routed
to Away Markets.
    The proposed rule would then set forth additional details regarding
routing:
     Proposed Rule 7.37P(b)(1) would provide that an order that
cannot meet the pricing parameters of proposed Rule 7.37P(a) may be
routed to Away Market(s) before being matched for execution against
contra-side orders in the NYSE Arca Book. The Exchange believes that
this proposed rule text provides transparency that an order may be
routed before being matched for execution, for example, to prevent
locking or crossing or trading through a protected quotation.
     Proposed Rule 7.37P(b)(2) would provide that if an order
with an instruction not to route would trade through or lock or cross a
protected quotation and is not eligible for an exception to either Rule
610 or 611 of Regulation NMS,\26\ it would cancel, re-price, or be held
undisplayed on the NYSE Arca Book, as provided for in Rules 7.31P and
7.44P.
---------------------------------------------------------------------------

    \26\ 17 CFR 242.610 and 17 CFR 242.611.
---------------------------------------------------------------------------

     Proposed Rule 7.37P(b)(3) would provide that orders
eligible to route would be routed to all available Away Markets unless
the order includes an instruction to bypass market centers that are not
displaying protected quotations. This rule text covers the subject
matter of current Rule 7.37(d)(2)(A), 7.37(d)(2)(B), and 7.37(d)(4),
with no substantive differences. As with current functionality,
proposed Rule 7.37P(b)(1) specifies that all Away Markets, as defined
in proposed Rule 1.1(ffP), would be considered as part of the routing
determination unless the User has opted out of routing to Away Markets
that do not display protected quotations.
     Proposed Rule 7.37P(b)(4) would provide that Limit Orders
that are routed to Away Market(s) may be routed to more than one price
level, up (down) to the limit price of an order to buy (sell). This
represents current routing functionality and means that a Limit Order
may be routed to more than just the top of book bid or offer of an Away
Market, provided that the order would not be routed to prices that are
outside of the limit price of the order and consistent with Rule 611 of
Regulation NMS,\27\ as provided for in proposed Rule 7.37P(a)(2). The
Exchange believes that including this level of detail in the rule
provides transparency regarding the potential for an order to be routed
to more than one price level on an Away Market. The Exchange believes
that routing to depth of Away Markets provides a greater opportunity
for an order to be executed in full.
---------------------------------------------------------------------------

    \27\ 17 CFR 242.611.
---------------------------------------------------------------------------

     Proposed Rule 7.37P(b)(5) would provide that, except for
orders routed to the primary listing market on arrival pursuant to Rule
7.34P or designated to route to the primary listing market pursuant to
Rule 7.31P, orders routed to Away Markets would be sent as IOC ISOs.
This routing is based on current Rule 7.37(d)(2)(B)(i) with no
substantive differences.
     Proposed Rule 7.37P(b)(6) would provide that after any
order or portion thereof that has been routed would not be eligible to
trade on the NYSE Arca Book, unless all or a portion of the order
returns unexecuted. This routing methodology is current functionality
and covers that same subject as current Rule 7.37(d)(2)(C) and (D),
with no substantive differences. In contrast to Rule 7.37(d)(2)(C) and
(D), however, the Exchange proposes that Rule 7.37P(b)(6) would focus
on the fact that once routed, an order would not be eligible to trade
on the Exchange, rather than stating the obvious that it would be
subject to the routing destination's trading rules once routed. In
addition, because, as discussed above, the working time assigned to
orders that are routed is being proposed to be address in new Rule
7.36P(f)(1)(A) and (B), the Exchange believes it would be duplicative
to restate this information in new Rule 7.37P.
     Proposed Rule 7.37P(b)(7) would set forth how the Exchange
would process requests to cancel orders that have been routed. Rule
7.37(d)(2)(E) currently provides that requests from Users to cancel
their orders while the order is routed away to another market center or
market participant and remains outside the NYSE Arca Marketplace shall
be processed, subject to the applicable trading rules of the relevant
market center or market participant.
    The Exchange proposes to specify in new Rule 7.37P(b)(7)(A) that
requests to cancel orders that are eligible to be matched for execution
against orders in the NYSE Arca Book would not be processed unless and
until all or a portion of the order returns unexecuted. New Rule
7.37P(b)(7)(B) would specify that for orders routed to the primary
listing market on arrival pursuant to Rule 7.34P or designated to route
to the primary listing market pursuant to Rule 7.31P, requests to
cancel would be routed to the primary listing market, which is current
functionality.
    New Rule 7.37P(b)(7)(C) would provide, as currently set forth in
Rule 7.31(x) regarding Primary Only Orders, for MOC Orders or LOC
Orders in NYSE- or NYSE MKT-listed securities, requests to cancel or
reduce in size that are electronically entered after the times
specified in NYSE Rules 123C(3)(b) and NYSE MKT Rule 123C(3)(b)--
Equities and Supplementary Material .40 to those rules would be
rejected.\28\ The Exchange proposes to include this text in proposed
Rule 7.37P(b)(7) because it concerns how the Exchange would process
requests to cancel orders with instructions to route on arrival. By
including this rule text in proposed Rule 7.37P, the proposed
processing of electronically entered requests to cancel MOC or LOC
Orders in NYSE- or NYSE MKT-listed securities would also apply to such
orders that do not include a Primary Only Order designation, but which,
pursuant to Rule 7.34P, would be routed to the primary listing market
on arrival. The Exchange believes that the proposed changes would
provide transparency regarding how requests to cancel orders that have
been routed would be processed in Pillar, which would not be
substantively different from how the Exchange's current trading system
operates.
---------------------------------------------------------------------------

    \28\ NYSE Rule 123C(3)(b) and NYSE MKT Rule 123C(3)(b)--Equities
provide that between 3:45 p.m. and 3:58 p.m., MOC and LOC Orders may
be cancelled or reduced in size only to correct a legitimate error,
and NYSE Rule 123C(3)(c) and NYSE MKT Rule 123C(3)(c) provide that
MOC and LOC Orders may not be cancelled or reduced in size at all
after 3:58 p.m. Supplementary Material .40 to those rules provides,
among other things, that the times specified in those rules will be
adjusted based on the early scheduled closing time and references to
4:00 p.m. mean the early scheduled close, 3:45 p.m. means 15 minutes
before the early scheduled close, and 3:58 p.m. means two minutes
before the early scheduled close.
---------------------------------------------------------------------------

     Proposed Rule 7.37P(b)(8) would provide that an order
marked ``short'' when a short sale price test restriction is in effect
would not be routed. Instead of routing, the Exchange would reprice or
cancel the order consistent with Rule 7.16, which will be proposed as
Rule 7.16P in a separate rule filing for Pillar.
    The Exchange believes the specific routing methodologies for an
order type or modifier should be included with how the order type is
defined, which will be in Rule 7.31P. Accordingly, the Exchange does
not believe it needs to specify in new Rule 7.37P whether an order is
eligible to route, and if so, whether there are any specific routing

instructions applicable to the order and therefore will not be carrying
over such specifics that are included in Rule 7.37.
    The remaining proposed rule text of Rule 7.37P is based on Rule
7.37, with limited non-substantive differences:
     Proposed Rule 7.37P(c) would provide that after executing
with eligible contra-side interest on the NYSE Arca Book and/or
returning unexecuted after routing to Away Market(s), any unexecuted
non-marketable portion of an order would be ranked consistent with new
Rule 7.36P. This rule represents current functionality and is based on
Rule 7.37(d)(3) without any substantive differences.
     Proposed Rule 7.37P(d) would set forth the Exchange's use
of data feeds, and includes the rule text that is currently set forth
in Commentary .01 to Rule 7.37, without any substantive differences.
Proposed Rule 7.37P(d)(1) would not include the clause ``away market
quotes disseminated by'' as unnecessary language, with the proposed
rule text using the proposed defined term ``Away Markets'' as follows,
``[t]he Exchange receives data feeds directly from broker dealers for
purposes of routing interest to Away Markets that are not displaying
protected quotations.''
     Proposed Rule 7.37P(e) would set forth the same rule text
from Rule 7.37(e) regarding locking or crossing quotations in NMS
stocks with a non-substantive difference to update a cross-reference in
the rule to rule numbering in Rule 7.37P. The Exchange proposes an
additional non-substantive difference to specify in Rule 7.37P(e)(3)
that the prohibition against Locking and Crossing Quotations in
paragraph Rule 7.37P(e)(2) would not apply in the circumstances
specified in Rules 7.37P(e)(3)(A)-(C). Proposed Rules 7.37P(e)(3)(A)-
(C) is rule text that is identical to Rule 7.37(e)(3)(A)-(C).
     Proposed Rule 7.37P(f) would set forth the exceptions to
the Order Protection Rule \29\ and would enumerate the self-help
exception in Rule 7.37P(f)(1), which is based on Rule 7.37(f) regarding
Self-Help Exceptions, with two proposed modifications. The Exchange
would not include the second sentence of Rule 7.37(f)(1), which
provides that the Exchange will disregard another Trading Center's bid
and offer if the other Trading Center has repeatedly failed to respond
within one second to an incoming IOC order after adjusting for order
transmission time, in new Rule 7.37P(f)(1). The self-help exception set
forth in Rule 611(b)(1) of Regulation NMS \30\ and related Securities
and Exchange Commission staff guidance regarding this exception \31\
does not require trading centers to use the self-help exception if a
destination trading trading center fails to respond within one second
to an incoming IOC order, but state that such a failure would justify
use of the exception. Rather, a trading center is free to adopt
reasonable policies and procedures consistent with the flexible
purposes of the self-help exception. Because the Exchange does not use
the method described in the second sentence of current Rule 7.37(f)(1)
to determine whether to declare self-help, the Exchange proposes not to
include it in new Rule 7.37P(f)(1). Second, Rule 7.37(f)(1)(B) provides
that the Exchange follows ``published NYSE Arca policies and procedures
for electing the self-help exception.'' Because the Exchange publishes
those policies and procedures internally only, to reduce investor
confusion, the Exchange proposes to modify the text in proposed Rule
7.37P(f)(1)(B) to provide instead that the Exchange would follow
``established NYSE Arca policies and procedures for electing the self-
help exception.''
---------------------------------------------------------------------------

    \29\ 17 CFR 242.611(b).
    \30\ 17 CFR 611(b)(1).
    \31\ See Question 4.07, ``Responses to Frequently Asked
Questions Concerning Rule 611 and Rule 610 of Regulation NMS,''
available at https://www.sec.gov/divisions/marketreg/nmsfaq610-11.htm (``Beyond this basic parameter of repeated failure to turn
around an IOC order within one second, trading centers are free to
adopt reasonable policies and procedures that are consistent with
the flexible purposes of the self-help exception.'').
---------------------------------------------------------------------------

    Proposed Rules 7.37P(f)(2)-(4) are based on the rule text from Rule
7.37(g) regarding Additional Exceptions to the Order Protection Rule,
with non-substantive differences to reflect different rule numbering
and update the rule text to reflect current operations. First, the
Exchange proposes not to include the first and third sentences of Rule
7.37(g)(1) in proposed Rule 7.37P(f)(2)(A) relating to the Intermarket
Sweep Order Exception because when executing or displaying ISOs that it
receives from ETP Holders, it is the responsibility of the entering
broker dealer and not the Exchange to simultaneously route ISOs.
Therefore, the current rule text does not represent how the Exchange
operates, nor does it reflect the requirements of Regulation NMS. The
Exchange proposes additional non-substantive differences to the rule
text relating to this exception to update references, for example, to
refer to NYSE Arca's best bid or best offer rather than its own
protected quotation and remove reference to the ``NYSE Arca System.''
    Second, the Exchange proposes not to include the second sentence of
Rule 7.37(g)(3) relating to how the Exchange would conduct a single-
price reopening in proposed Rule 7.37P(f)(3). To reduce investor
confusion and promote transparency in its rules, the Exchange believes
that its rule governing auctions should set forth how the Exchange
conducts a single-price auction to reopen a stock following a trading
halt. Third, the Exchange proposes not to include current Rule
7.37(g)(5) text regarding Stopped Orders because the Exchange does not
currently, and will not in Pillar, support Stopped Orders on the
Exchange. Finally, the Exchange proposes not to include current Rule
7.37(g)(6) text regarding transactions other than ``regular-way''
contracts because in Pillar, the Exchange would not execute any orders
on terms other than standardized terms and conditions, i.e., ``regular
way'' contracts.
    Proposed Rule 7.37P(f)(5) regarding the Contingent Order Exemption
from the Order Protection Rule is based on rule text from Rule 7.37(h)
regarding Exemptions with different rule numbering and one substantive
difference. Rule 7.37(g)(2) specifies the requirements to meet the
qualified contingent trade exemption to Rule 611(a) of Regulation NMS
\32\ and are based on the requirements specified in the Commission's
Order granting an exemption for qualified contingent trades.\33\ Rule
7.37(f)(2)(G) currently specifies the original requirement that the
exempted transaction must be part of a contingent trade that involves
at least 10,000 shares or has a market value of at least $200,000. The
Commission later modified the exemption for qualified contingent trades
to remove that size condition.\34\ The Exchange therefore proposes not
to include in its proposed Rule 7.37P(f)(2)(D) the size requirement.
---------------------------------------------------------------------------

    \32\ 17 CFR 242.611(a).
    \33\ See Securities Exchange Act Release No. 54389 (August 31,
2006), 71 FR 52829 (September 7, 2006) (Order Granting an Exemption
for Qualified Contingent Trades from Rule 611(a) of Regulation NMS
under the Securities Exchange Act of 1934).
    \34\ See Securities Exchange Act Release No. 57620 (April 4,
2008), 73 FR 19271 (April 9, 2008) (Order Modifying the Exemption
for Qualified Contingent Trades from Rule 611(a) of Regulation NMS
under the Securities Exchange Act of 1934).
---------------------------------------------------------------------------

* * * * *
    As discussed above, because of the technology changes associated
with the migration to the Pillar trading platform, the Exchange will
announce by Trader Update when rules with a ``P'' modifier will become
operative and for which symbols. The Exchange believes that keeping
existing rules on the book

pending the full migration of Pillar will reduce confusion because it
will ensure that the rules governing trading on a trading platform will
continue to be available pending the full migration.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the
Securities Exchange Act of 1934 (the ``Act''),\35\ in general, and
furthers the objectives of Section 6(b)(5),\36\ 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 rules to support Pillar would remove
impediments to and perfect the mechanism of a free and open market
because the proposed rule set would promote transparency in Exchange
rules by using consistent terminology governing equities trading,
thereby ensuring that members, regulators, and the public can more
easily navigate the Exchange's rulebook and better understand how
equity trading is conducted on the Exchange. Adding new rules with the
modifier ``P'' to denote those rules that would be operative for the
Pillar trading platform would remove impediments to and perfect the
mechanism of a free and open market by providing transparency of which
rules govern trading once a symbol has been migrated to the Pillar
platform.
---------------------------------------------------------------------------

    \35\ 15 U.S.C. 78f(b).
    \36\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed restructuring in new Rules
7.34P, 7.36P, and 7.37P would remove impediments to and perfect the
mechanism of a free and open market by assuring consistency of terms
used in the Exchange's rulebook. The proposed revisions to the
Exchange's equity trading rules to reflect terminology associated with
Pillar would remove impediments to and perfect a free and open market
because the proposed changes are designed to simplify the structure of
the Exchanges rules and permit the use of consistent terminology
throughout numerous rules, without changing the underlying
functionality. For example, the Exchange believes the proposed
definitions set forth in Rule 7.36P, i.e., display price, limit price,
working price, and working time, promote transparency in Exchange rules
and make them easier to understand because these proposed definitions
will serve as the foundation for additional rule changes to support
Pillar.
    The Exchange further believes that moving specified rule text that
relates to specific order types that is set forth in Rules 7.34, 7.36
and 7.37 to proposed Rule 7.31P (which will be the subject of a
separate filing), and therefore not include such detail in proposed
Rules 7.34P, 7.36P and 7.37P, would make Exchange rules easier to
navigate because information regarding how a specific order type would
operate would be in a single location in the Exchange's rule book.
    With respect to proposed Rule 7.34P, the Exchange believes that the
proposed changes to functionality would remove impediments to and
perfect the mechanism of a fair and orderly market. First, the Exchange
believes that because an auction that opens a trading session should
occur within that trading session, it would remove impediments to and
perfect the mechanism of a fair and orderly market for the Core Open
Auction to occur during the Core Trading Session instead of the Early
Trading Session. Second, the Exchange believes that the proposed change
to route to the primary listing market Market Orders and Auction-Only
Orders in symbols that are not eligible for an execution on the
Exchange would remove impediments to and perfect the mechanism of a
free and open market by ensuring that such orders reach a destination
where they may be eligible to obtain an execution or participate in an
auction. This is current functionality, but it is only available for
orders that have been designated as ``Primary Only.'' Expanding this
functionality to orders that do not include that designation would also
protect investors and the public interest by enabling such interest to
reach a destination where it is more likely to obtain an execution
opportunity or participate in an auction. Finally, the Exchange
believes that making Tracking Orders available during the Early and
Late Trading Sessions would remove impediments to and perfect the
mechanism of a free and open market by providing additional execution
opportunities on the Exchange through the availability of additional
passive liquidity.
    With respect to proposed Rules 7.36P and 7.37P, as discussed above,
the Exchange is not proposing any functional changes to how it ranks,
displays, executes, or routes orders. The Exchange believes, however,
that the proposed rule text promotes transparency through the use of
consistent terminology that will serve as the foundation for additional
Pillar-related rule proposals. The Exchange also believes that adding
more detail regarding current functionality in new Rules 7.34P, 7.36P,
and &.37P, as described above, would promote transparency by providing
notice of when orders would be accepted, routed, rejected, cancelled,
or be assigned a working time by the Exchange.

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 to adopt new rules
to support the Exchange's new Pillar trading platform. As discussed in
detail above, with this rule filing, the Exchange is not proposing to
change its core functionality regarding its price-time priority model,
and in particular, how it would rank, display, execute or route orders
in Pillar. Rather, the Exchange believes that the proposed rule change
would promote consistent use of terminology to support the Pillar
trading platform making the Exchange's rules easier to navigate.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the
proposed rule change.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or up to 90 days (i) as the Commission may designate
if it finds such longer period to be appropriate and publishes its
reasons for so finding or (ii) as to which the self-regulatory
organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act.

Comments may be submitted by any of the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NYSEARCA-2015-38 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-2015-38. 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 will also be
available for inspection and copying at the NYSE's principal office and
on its Internet Web site at www.nyse.com. 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-2015-38, and should be
submitted on or before June 9, 2015.
---------------------------------------------------------------------------

    \37\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\37\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-12028 Filed 5-18-15; 8:45 am]
 BILLING CODE 8011-01-P


Comment Info: =================

General Comment: Dear Mr. Zeller:

I am writing as an individual consumer AND small business owner of e-cigarettes to request an extension of the comment period for the Food and Drug Administration's ("FDA") Proposed Rule Deeming Tobacco Products to be Subject to the Federal Food, Drug, and Cosmetic Act, as amended by the Family Smoking and Prevention and Tobacco Control Act (the "Proposed Rule") published at 79 Fed. Reg. 23,142 and Federal Register No. 2014-09491. On behalf of myself, I am requesting that the comment period for the Proposed Rule be extended by the FDA for an additional 105 days, from its current 75-day period, to 180 days.

The Proposed Rule raises a number of significant issues and questions that are important and relevant to me, as a consumer and small business owner of products that are proposed for regulation under the Proposed Rule. The Proposed Rule asks about a hundred different questions I might want to respond to. I want to provide my thoughts and comments on many of these issues, but my time to devote to researching and providing thoughtful comments on these important questions is limited. I have already spent many hours researching and dissecting these issues, but they take time. I know that the FDA took many years to even come up with the Proposed Rule, so I do not think it is at all unreasonable to allow the public a mere six months to comment on it. This is our only opportunity, as consumers, to provide our feedback.

I have built a business around e-cigarettes that provide for my lively hood and future for myself and my employees. I feel very strongly about e-cigarettes as an alternative to combustible cigarettes. Quite simply, I firmly believe that they saved my life. I wish to provide you with my personal story, as well as science- and evidence-based responses to your questions so that you can take my comment into account. I realize that the FDA has the authority under 21 CFR 10.40 to extend this time frame and that the FDA has exercised this authority on numerous occasions in the past. I would therefore ask that you do so here, so that all stakeholders have the opportunity to provide their comments on this proposed regulation.

I appreciate your consideration of my request and am happy to discuss this issue with you further.