[Federal Register Volume 80, Number 215 (Friday, November 6, 2015)]
[Notices]
[Pages 68884-68888]
[FR Doc No: 2015-28268]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76327; File No. SR-BATS-2015-93

Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Delete
Rule 22.10, Limitations on Dealings

November 2, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on October 21, 2015, BATS Exchange, Inc. (the ``Exchange'' or
``BATS'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II
and III below, which Items have been prepared by the Exchange. The
Exchange has designated this proposal as a ``non-controversial''
proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and
Rule 19b-4(f)(6)(iii) thereunder,\4\ which renders it effective upon
filing with the Commission. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6)(iii).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange filed a proposal for the BATS Options Market (``BATS
Options'') to adopt a principles-based approach to prohibit the misuse
of material nonpublic information by Market Makers by deleting Rule
22.10 (Limitations on Dealings).

    The text of the proposed rule change is available at the Exchange's
Web site at www.batstrading.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 Exchange 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 these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant parts of such
statements.

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

1. Purpose
    The Exchange proposes to adopt a principles-based approach to
prohibit the misuse of material non-public information by Market Makers
by deleting Rule 22.10 (Limitations on Dealings). In doing so, the
Exchange, with regard to BATS Options, would harmonize its rules
governing Market Makers and Options Members that are not Market Makers
relating to the protection against misuse of material, non-public
information. The Exchange believes that Rule 22.10 is no longer
necessary because all Options Members, including Market Makers, are
subject to the Exchange's generally applicable principles-based
requirements governing the protection against the misuse of material,
non-public information, pursuant to Rule 5.5 (Prevention of the Misuse
of Material, Non-Public Information), which obviates the need for
separately prescribed requirements for a subset of Exchange
participants. Additionally, there is no separate regulatory purpose
served by having separate rules for Market Makers. The Exchange notes
that this proposed rule change will not decrease the protections
against the misuse of material, non-public information; instead, it is
designed to provide more flexibility to Options Members. This is a
competitive filing that is based on a proposal recently submitted by
NYSE MKT LLC (``NYSE MKT'') and approved by the Commission.\5\
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    \5\ See Securities Exchange Act Release No. 75432 (July 13,
2015), 80 FR 42597 (July 17, 2015) (Order Approving SR-NYSEMKT-2015-
23).
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Background
    The Exchange has two classes of BATS Options participants.
Specifically, pursuant to Rule 16.1.(a)(38), the term ``Options
Member'' means a firm or organization that is registered with the
Exchange pursuant to Chapter XVII of the Rules for the purposes of
participating in options trading on BATS Options either as an ``Options
Order Entry Firm'' or as an ``Options Market Maker.'' Pursuant to Rule
16.1(a)(36), the terms ``Options Order Entry Firm'' or ``Order Entry
Firm'' or ``OEF'' mean those Options Members representing as agent
Customer Orders on BATS Options and those non-Market Maker Members
conducting proprietary trading. Pursuant to Rule 16.1(a)(37), the term
``Options Market Maker'' or ``Market Maker'' means an Options Member
registered with the Exchange for the purpose of making markets in
options contracts traded on the Exchange and that is vested with the
rights and responsibilities specified in Chapter XXII of the Rules.
    Rule 22.5 (Obligations of Market Makers) describes the obligations
of Market Makers. Rule 22.6 (Market Maker Quotations) sets forth
quoting obligations of Market Makers.\6\ Rule 22.10 (Limitations on
Dealings) requires Market Makers to maintain information barriers that
are reasonably designed to prevent the misuse of material, non-public
corporate or markets information in the possession of persons on one
side of the information barrier by persons on the other side of the
information barrier.
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    \6\ Rule 22.6 generally requires that Market Makers provide
firm, two-sided, continuous quotations, in minimum size, for the
options series to which it is registered.
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Proposed Rule Change
    The Exchange believes that the particularized guidelines for Market
Makers in Rule 22.10 are no longer necessary and proposes to delete
Rule 22.10. The Exchange believes that Rule 5.5 (Prevention of the
Misuse of Material, Nonpublic Information), which governs the misuse of
material, non-public information and applies to all Members (including
Options Members), provides an appropriate, principles-based approach to
prevent the market abuses that Rule 22.10 seeks to address.
Specifically, Rule 5.5 requires every Member (including Options
Members) to establish, maintain, and enforce written policies and
procedures reasonably designed to prevent the misuse of material, non-
public information by such Member or persons associated with such
Member. For purposes of Rule 5.5, the misuse of material, non-public
information includes, but is not limited to, the following:
    (1) Trading in any securities issued by a corporation, or in any
related securities or related options or other derivative securities,
while in possession of material, non-public information concerning that
issuer;
    (2) Trading in a security or related options or other derivative
securities, while in possession of material, non-public information
concerning imminent transactions in the security or related securities;
and
    (3) Disclosing to another person or entity any material nonpublic
information involving a corporation whose shares are publicly traded or
an imminent transaction in an underlying security or related securities
for the purpose of facilitating the possible misuse of such material
nonpublic information.
    Because Options Members are already subject to the requirements of
Rule 5.5, the Exchange does not believe that it is necessary to
separately require particularized limitations on Market Makers.
Deleting Rule 22.10, with its particularized limitations would provide
Market Makers with the flexibility to adapt their policies and
procedures as appropriate to reflect changes to their business model,
business activities, or the securities market in a manner similar to
how Options Members on the Exchange currently operate in conformity
with Rule 5.5.
    As noted above, Market Makers are distinguished under Exchange
rules from other Options Members only to the extent that Market Makers
have heightened quoting obligations. However, such heightened quoting
obligations do not afford different or greater access to nonpublic
information than any other Options Member of the Exchange.\7\
Therefore, because Market Makers do not have any trading advantages
over Order Entry Firms on BATS Options, the Exchange believes

that they should be subject to the same rules regarding the protection
against the misuse of material non-public information, which in this
case, is existing Rule 5.5.
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    \7\ The Exchange notes that by deleting Rule 22.10, the Exchange
would no longer require specific information barriers for Market
Makers; however, as is the case currently with Options Members,
information barriers of new participants would be subject to review
as part of a new firm application. Moreover, the policies and
procedures of Market Makers, including those relating to any
information barriers, would be subject to review by FINRA, on behalf
of the Exchange, pursuant to a Regulatory Services Agreement.
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    The Exchange notes that its proposed approach to use a principles-
based approach to protecting against the misuse of material non-public
information for all of its registered Options Members is consistent
with recently approved rule changes for NYSE MKT and recently filed
changes for the International Securities Exchange LLC (``ISE'') and the
Boston Options Exchange LLC (``BOX'').\8\ Each of these exchanges has
moved to a principles-based approach to protecting against the misuse
of material non- public information. In connection with approving those
rule changes, the Commission found that, with adequate oversight by the
exchanges of their members, eliminating prescriptive information
barrier requirements should not reduce the effectiveness of exchange
rules requiring its members to establish and maintain systems to
supervise the activities of its members, including written procedures
reasonably designed to ensure compliance with applicable federal
securities law and regulations, and with the rules of the applicable
exchange.\9\
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    \8\ See Securities Exchange Act Release No. 75432 (July 13,
2015), 80 FR 42597 (July 17, 2015) (Order Approving Adopting a
Principles-Based Approach to Prohibit the Misuse of Material
Nonpublic Information by Specialists and e-Specialists by Deleting
Rule 927.3NY and Section (f) of Rule 927.5NY). See also Securities
Exchange Act Release Nos. 75792 (August 31, 2015), 80 FR 53601
(September 4, 2015) (SR-ISE-2015-26) (Notice of Filing and Immediate
Effectiveness of Proposed Rule Change Adopting a Principles-Based
Approach To Prohibit the Misuse of Material, Non-Public Information
by Market Makers by Deleting Rule 810); 75916 (September 14, 2015),
80 FR 56503 (September 18, 2015) (SR-BOX-2015-31) (Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Adopt a
Principles-Based Approach To Prohibit the Misuse of Material
Nonpublic Information by Market Makers).
    \9\ See supra note 8.
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    The Exchange believes that a principles-based rule applicable to
members of options markets would be effective in protecting against the
misuse of material non-public information. Indeed, Exchange Rule 5.5 is
currently applicable to Options Members and already requires policies
and procedures reasonably designed to prevent the misuse of material
nonpublic information. The Exchange believes that Rule 5.5 provides
appropriate protection against the misuse of material nonpublic
information by Options Members and that there is no longer a need for
prescriptive information barrier requirements set forth in Rule 22.10.
    The Exchange notes that even with this proposed rule change and the
elimination of the requirement that the Exchange pre-approve a Member's
policies and procedures, pursuant to Rule 5.5, an Options Member would
still be obligated to ensure that its policies and procedures reflect
the current state of its business and continue to be reasonably
designed to achieve compliance with applicable federal securities law
and regulations, including Section 15(g) of the Act,\10\ and with
applicable Exchange rules, including being reasonably designed to
protect against the misuse of material, non-public information. Thus,
the Exchange does not believe there will be any material change to
Member's information barriers as a result of the Exchange's pre-
approval no longer being required. In fact, the Exchange anticipates
that the lack of such pre-approval would facilitate Market Maker's
ability to more quickly implement changes to their information barrier
as necessary to protect against the misuse of material, non-public
information.
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    \10\ 15 U.S.C 78o(g).
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    The Exchange is not proposing to change what is considered to be
material, non-public information and, thus, would not expect there to
be any changes to the types of information that an affiliated brokerage
business of a Market Maker could share with such Market Maker. In
addition, the Exchange notes that the proposed rule change would not
permit the affiliates of a Market Maker to have access to any non-
public order or quote information of the Market Maker, including the
non-displayed size of Reserve Orders.\11\ Affiliates of Market Makers
would only be permitted to have access to orders and quotes that are
publicly available to all market participants.
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    \11\ Reserve Orders are described in Rule 21.1(d) and include
both a quantity that is displayed and a reserve portion that is not
displayed.
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    While information barriers would not specifically be required under
the proposal, Rule 5.5 already requires that an Options Member consider
its business model or business activities in structuring its policies
and procedures, which may dictate that an information barrier or a
functional separation be part of the appropriate set of policies and
procedures that would be reasonably designed to achieve compliance with
applicable securities law and regulations, and with applicable Exchange
rules.
    The Exchange believes that the proposed reliance on the principles-
based Rule 5.5 would ensure that an Options Member would be required to
protect against the misuse of any material non-public information. As
noted above, Rule 5.5 already requires that Members refrain from
trading while in possession of material non-public information
concerning imminent transactions in the security or related product.
The Exchange believes that moving to a principles-based approach rather
than prescribing particularized information barriers applicable to
Market Makers would provide Market Makers with flexibility when
managing risk across a firm, including integrating options positions
with other positions of the firm or, as applicable, by the respective
independent trading unit.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with the
requirements of the Act and the rules and regulations thereunder that
are applicable to a national securities exchange, and, in particular,
with the requirements of Section 6(b) of the Act.\12\ In particular,
the proposal is consistent with Section 6(b)(5) of the Act \13\ because
it is designed to prevent fraudulent and manipulative acts and
practices, would promote just and equitable principles of trade, remove
impediments to, and perfect the mechanism of, a free and open market
and a national market system, and, in general protect investors and the
public interest.
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    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that the proposed rule change would remove
impediments to and perfect the mechanism of a free and open market by
adopting a principles-based approach to permit an Options Member to
maintain and enforce policies and procedures to, among other things,
prohibit the misuse of material non-public information and provide
flexibility on how a Market Maker structures its operations. The
Exchange notes that the proposed rule change is based upon an approved
rule of the Exchange to which Options Members are subject--Rule 5.5--
and the proposed change harmonizes the rules governing Options Members.
Moreover, Market Makers would continue to be subject to federal and
Exchange requirements for protecting material non- public order
information.\14\ The Exchange believes that the proposed rule change
would remove impediments to and perfect the mechanism of a free and
open market because it would harmonize the Exchange's approach to
protecting against the misuse of material

nonpublic information and no longer subject Market Makers to
particularized prescriptive requirements. The Exchange does not believe
that the existing prescriptive requirements applicable to Options
Market Makers are narrowly tailored to their respective role because
Market Makers do not have access to Exchange trading information in a
manner different from any other Options Member that is not a Market
Maker.
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    \14\ See 15 U.S.C. 78o(g) and Rule 5.5.
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    The Exchange further believes the proposal is designed to prevent
fraudulent and manipulative acts and practices and to promote just and
equitable principles of trade because existing rules make clear to
Options Members the type of conduct that is prohibited by the Exchange.
While the proposal eliminates certain prescriptive requirements
relating to the misuse of material non-public information, Market
Makers would remain subject to existing Exchange rules requiring them
to establish and maintain systems to supervise their activities, and to
create, implement, and maintain written procedures that are reasonably
designed to comply with applicable securities laws and Exchange rules,
including the prohibition on the misuse of material, nonpublic
information. Additionally, the policies and procedures of Market
Makers, including those relating to information barriers, would be
subject to review by FINRA, on behalf of the Exchange.\15\
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    \15\ See supra, note 7.
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    The Exchange notes that the proposed rule change would still
require that Market Makers maintain and enforce policies and procedures
reasonably designed to ensure compliance with applicable federal
securities laws and regulations and with Exchange rules. Even though
there would no longer be particularized Market Maker information
barriers, any Market Maker written policies and procedures would
continue to be subject to oversight by the Exchange and therefore the
elimination of prescribed requirements should not reduce the
effectiveness of the Exchange rules to protect against the misuse of
material non-public information. Rather, all Options Members will be
able to utilize a flexible, principles-based approach to modify their
policies and procedures as appropriate to reflect changes to their
business model, business activities, or to the securities market
itself. Moreover, while particularized information barriers may no
longer be required, an Options Member's business model or business
activities may dictate that an information barrier or functional
separation be part of the appropriate set of policies and procedures
that would be reasonably designed to achieve compliance with applicable
securities laws and regulations, and with applicable Exchange rules.
The Exchange therefore believes that the proposed rule change will
maintain the existing protection of investors and the public interest
that is currently applicable to Market Makers, while at the same time
removing impediments to and perfecting a free and open market by moving
to a principles-based approach to protect against the misuse of
material non-public information.

(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. In this regard and as
indicated above, the Exchange notes that the rule change is being
proposed as a competitive response to a filing submitted by NYSE MKT
that was recently approved by the Commission.\16\ The Exchange believes
this proposed rule change is necessary to permit fair competition among
the options exchanges.
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    \16\ See supra, note 5.
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    The Exchange believes that the proposal will enhance competition by
allowing Market Makers to comply with applicable Exchange rules in a
manner best suited to their business models, business activities, and
the securities markets, thus reducing regulatory burdens while still
ensuring compliance with applicable securities laws and regulations and
Exchange rules. The Exchange believes that the proposal will foster a
fair and orderly marketplace without being overly burdensome upon
Market Makers.

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

    The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any written comments from members or other interested parties.

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

    Because the foregoing proposed rule change does not: (A)
Significantly affect the protection of investors or the public
interest; (B) impose any significant burden on competition; and (C) by
its terms, become operative for 30 days from the date on which it was
filed or such shorter time as the Commission may designate it has
become effective pursuant to Section 19(b)(3)(A) of the Act \17\ and
paragraph (f)(6) of Rule 19b-4 thereunder,\18\ the Exchange has
designated this rule filing as non-controversial. The Exchange has
given the Commission written notice of its intent to file the proposed
rule change, along with a brief description and text of the proposed
rule change at least five business days prior to the date of filing of
the proposed rule change, or such shorter time as designated by the
Commission.
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    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4.
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is: (1)
Necessary or appropriate in the public interest; (2) for the protection
of investors; or (3) otherwise in furtherance of the purposes of the
Act. If the Commission takes such action, the Commission shall
institute proceedings to determine whether the proposed rule should be
approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-BATS-2015-93 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number SR-BATS-2015-93. 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
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-BATS-2015-93 and should be submitted on or before
November 27, 2015.

     For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2015-28268 Filed 11-5-15; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 82, Number 51 (Friday, March 17, 2017)]
[Notices]
[Pages 14272-14274]
[FR Doc No: 2017-05344]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80229; File No. SR-NASDAQ-2017-024]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend the Data Collection Requirements in Rule 4470

March 13, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on February 28, 2017, The NASDAQ Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I, and II, below, which Items have been prepared by the Exchange.
The Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend Rule 4770 to modify the date of
Appendix B Web site data publication pursuant to the Regulation NMS
Plan to Implement a Tick Size Pilot Program (``Plan'').
    The text of the proposed rule change is available on the Exchange's
Web site at http://nasdaq.cchwallstreet.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 Exchange 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 these 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 aspects of such
statements.

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

1. Purpose
    Rule 4770(b) (Compliance with Data Collection Requirements) \3\
implements the data collection and Web site publication requirements of
the Plan.\4\ Commentary .08 to Rule 4770 provides, among other things,
that the requirement that the Exchange make certain data publicly
available on the Nasdaq Web site pursuant to Appendix B and C to the
Plan shall commence at the beginning of the Pilot Period,\5\ and that
Nasdaq shall make data for the Pre-Pilot Period publicly available on
the Nasdaq Web site pursuant to Appendix B and C to the Plan by
February 28, 2017.\6\
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    \3\ See Rule 4770(b). See also Securities Exchange Act Release
No. 77456 (March 28, 2016), 81 FR 18925 (April 1, 2016) (SR-NASDAQ-
2016-043).
    \4\ The Participants filed the Plan to comply with an order
issued by the Commission on June 24, 2014. See Letter from Brendon
J. Weiss, Vice President, Intercontinental Exchange, Inc., to
Secretary, Commission, dated August 25, 2014 (``SRO Tick Size Plan
Proposal''). See Securities Exchange Act Release No 72460 (June 24,
2014), 79 FR 36840 (June 30, 2014); see also Securities Exchange Act
Release No. 74892 (May 6, 2015), 80 FR 27513 (May 13, 2015).
    \5\ Unless otherwise defined herein, capitalized terms have the
meaning ascribed to them in Rule 4770.
    \6\ On November 30, 2016, the SEC granted exemptive relief to
the Participants to, among other things, delay the publication of
Web site data pursuant to Appendices B and C to the Plan until
February 28, 2017, and to delay the ongoing Web site publication by
ninety days such that data would be published within 120 calendar
days following the end of the month. See Letter from David S.
Shillman, Associate Director, Division of Trading and Markets,
Commission, to Marcia E. Asquith, Senior Vice President and
Corporate Secretary, FINRA, dated November 30, 2016; see also
Securities Exchange Act Release No. 79546 (December 14, 2016), 81 FR
92932 (December 20, 2016) (SR-NASDAQ-2016-165).
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    Nasdaq is proposing amendments to Commentary .08 to Rule 4770 to
delay the date by which Pre-Pilot and Pilot Appendix B data is to be
made publicly available on Nasdaq's Web site from February 28, 2017,
until April 28, 2017. Appendix C data for the Pre-Pilot Period through
the month of January 2017 will be published on the Nasdaq Web site on
February 28, 2017, and, thereafter, on the original 30-day schedule.\7\
As some of the data reporting requirements set forth in Rule 4770
require members to report data to their Designated Examining Authority
(``DEA''), which may not be Nasdaq, the Exchange is also proposing to
add references in Commentary .08 to reflect the fact that the Exchange
or the DEA may be publishing such data.
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    \7\ Since, under Rule 4770(b)(4), Nasdaq is not independently
publishing Market Maker profitability data collected pursuant to
Item I of Appendix C of the Plan, no corresponding change to the
language of Rule 4770(b)(4) relating to the timing of the
publication of Appendix C data for the Pilot Period is needed.
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    In the SRO Tick Size Plan Proposal, the Participants stated that
the public data will be made available for free ``on a disaggregated
basis by trading center'' on the Web sites of the Participants and the
Designated Examining Authorities.\8\ However, market participants have
expressed confidentiality concerns regarding this approach for over-
the-counter (``OTC'') data.\9\ Thus, Nasdaq is filing the instant
proposed rule change to provide additional time to assess a means of
addressing the confidentiality concerns raised in connection with the
publication of Appendix B data related to OTC activity in furtherance
of the objectives of the Plan.\10\ Pursuant to this amendment, Appendix
B data publication will be delayed until April 28, 2017. The
Participants anticipate filing additional proposed rule changes to
address Appendix B data publication.
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    \8\ See Securities Exchange Act Release No. 73511 (November 3,
2014), 79 FR 66423 (November 7, 2014) (Notice of Filing of Proposed
National Market System Plan to Implement a Tick Size Pilot Program
on a One-Year Pilot Basis, File No. 4-657) (``Tick Size Plan
Proposal'').
    \9\ See letters from Adam C. Cooper, Senior Managing Director
and Chief Legal Officer, Citadel Securities, to Brent J. Fields,
Secretary, Commission, dated December 21, 2016 (``Citadel letter'');
and William Hebert, Managing Director, Financial Information Forum,
to Robert W. Errett, Deputy Secretary, Commission, dated December
21, 2016 (``FIF letter'').
    \10\ In connection with its filing to implement a similar change
in its rules, the Financial Industry Regulatory Authority, Inc. is
also submitting an exemptive request to the SEC on behalf of all
Plan Participants requesting relief from the relevant requirements
of the Plan.
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    Nasdaq has filed the proposed rule change for immediate
effectiveness. The operative date of the proposed rule change will be
the date of filing.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\11\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\12\ in particular, in that it is designed to
prevent fraudulent and manipulative acts and practices, promote just
and equitable principles of trade, 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. Nasdaq also
believes that the proposal is consistent with Section 6(b)(8) of the
Act,\13\ which requires that Exchange rules not impose any burden on
competition that is not necessary or appropriate.
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    \11\ 15 U.S.C. 78f(b).
    \12\ 15 U.S.C. 78f(b)(5).
    \13\ 15 U.S.C. 78f(b)(8).
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    The Plan is designed to allow the Commission, market participants,
and the public to study and assess the impact of increment conventions
on the liquidity and trading of the common stock of small-
capitalization companies. Nasdaq believes that this proposal is
consistent with the Act because it is in furtherance of the objectives
of Section VII(A) of the Plan in that it is designed to provide Nasdaq
with additional time to assess a means of addressing the
confidentiality concerns raised in connection with the publication of
Appendix B data, to comply with the Plan's requirements that the data
made publicly available will not identify the trading center that
generated the data.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The proposed rule change
implements the provisions of the Plan.

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

    No written comments were either solicited or received.

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

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \14\ and Rule 19b-
4(f)(6) thereunder.\15\
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    \14\ 15 U.S.C. 78s(b)(3)(A).
    \15\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) normally does
not become operative prior to 30 days after the date of the filing.
However, pursuant to Rule 19b-4(f)(6)(iii), the Commission may
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has filed
the proposed rule change for immediate effectiveness and has requested
that the Commission waive the requirement that the proposed rule change
not become operative for 30 days after the date of the filing so that
it may become operative on February 28, 2017.
    The Exchange notes that the proposed rule change is intended to
address confidentiality concerns raised in connection with the
publication of OTC Appendix B data by permitting the Exchange to delay
Web site publication of its Appendix B data from February 28, 2017 to
April 28, 2017.\16\ The Exchange notes that the delay would provide
additional time to assess a means of addressing the confidentiality
concerns. The Exchange notes that it expects Participants to file
proposed rule changes related to publishing Appendix B data.
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    \16\ See supra note 9. The Commission notes that FINRA has
submitted a proposed rule change to delay the publication of OTC
Appendix B data. See SR-FINRA-2017-005.
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    The Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest
because it will allow the Exchange to delay publication of its Appendix
B data until April 28, 2017. As noted above, commenters continue to
raise concerns about the publication of OTC Appendix B data.\17\
Delaying publication of Exchange's Appendix B data \18\ will prevent
the publication of partial (i.e., Exchange-only) Appendix B data
required under the Plan. Therefore, the Commission hereby waives the
30-day operative delay and designates the proposed rule change to be
operative on February 28, 2017.\19\
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    \17\ The Commission notes that FINRA has filed a proposed rule
change that is intended to mitigate confidentiality concerns raised
by commenters regarding the publication of OTC Appendix B data. See
SR-FINRA-2017-006.
    \18\ The Commission notes that other Participants have proposed
to delay the publication of their Appendix B data until April 28,
2017. See SR-BatsBYX-2017-05; SR-BatsBZX-2017-15; SR-BatsEDGA-2017-
05; SR-BatsEDGX-2017-13; SR-BX-2017-016; SR-CHX-2017-05; SR-FINRA-
2017-005; SR-IEX-2017-07; SR-Phlx-2017-22; SR-NYSE-2017-10; SR-
NYSEArca-2017-19; SR-NYSEMKT-2017-11.
    \19\ For purposes only of waiving the operative delay for this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-NASDAQ-2017-024 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-NASDAQ-2017-024. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NASDAQ-2017-024, and should
be submitted on or before April 7, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\20\
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    \20\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-05344 Filed 3-16-17; 8:45 am]
 BILLING CODE 8011-01-P


                                                                                March 14, 2012

MEMORANDUM SUBJECT:	Incorporation of the Science Assessment for Sulfur Oxides and Science 				Assessment for Nitrogen Oxides Dockets (SOx: EPA-HQ-ORD-2006-0260, NOx: 		EPA-HQ-ORD-2005-0029) into the Review of the National Ambient Air Quality 			Standards for Oxides of Nitrogen and Sulfur Docket (EPA-HQ-OAR-2007-1145) FROM:	Ginger Tennant 		Health and Environmental Impacts Division

TO:		Rulemaking Docket for Oxides of Nitrogen and Sulfur (EPA-HQ-OAR-2007-			1145)

	Materials contained in Dockets No. EPA-HQ-ORD-2006-0260 and EPA-HQ-ORD-2005-0029 (Science Assessment for Sulfur Oxides and Science Assessment for Nitrogen Oxides) will be incorporated by reference into the Review of the National Ambient Air Quality Standards for Oxides of Nitrogen and Sulfur Docket (EPA-HQ-OAR-2007-1145).