[Federal Register Volume 78, Number 60 (Thursday, March 28, 2013)]
[Notices]
[Pages 19029-19031]
[FR Doc No: 2013-07191]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69215; File No. S7-24-89]

Joint Industry Plan; Notice of Filing and Immediate Effectiveness
of Amendment No. 27 to the Joint Self-Regulatory Organization Plan
Governing the Collection, Consolidation and Dissemination of Quotation
and Transaction Information for Nasdaq-Listed Securities Traded on
Exchanges on an Unlisted Trading Privileges Basis Submitted by the BATS
Exchange, Inc., BATS Y-Exchange, Inc., Chicago Board Options Exchange,
Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX
Exchange, Inc., Financial Industry Regulatory Authority, Inc.,
International Securities Exchange LLC, NASDAQ OMX BX, Inc., NASDAQ OMX
PHLX LLC, Nasdaq Stock Market LLC, National Stock Exchange, Inc., New
York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc.

March 22, 2013.
    Pursuant to Section 11A of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 608 thereunder,\2\ notice is hereby given that
on March 22, 2013, the operating committee (``Operating Committee'' or
``Committee'') \3\ of the Joint Self-Regulatory Organization Plan
Governing the Collection, Consolidation, and Dissemination of Quotation
and Transaction Information for Nasdaq-Listed Securities Traded on
Exchanges on an Unlisted Trading Privilege Basis (``Nasdaq/UTP Plan''
or ``Plan'') filed with the Securities and Exchange Commission
(``Commission'') an amendment to the Plan.\4\ This

amendment represents Amendment No. 27 (``Amendment'') to the Plan and
proposes to revise the metric by which the Participants calculate the
annual increase in the Enterprise Maximum. Pursuant to Rule
608(b)(3)(i) under the Act, the Participants designated the Amendment
as establishing or changing a fee or other charge collected on behalf
of all of the Participants in connection with access to, or use of, the
facilities contemplated by the Amendment. As a result, the Amendment
has been put into effect upon filing with the Commission. At any time
within 60 days of the filing of the Amendment, the Commission may
summarily abrogate the Amendment and require that the Amendment be
refiled in accordance with paragraph (a)(1) of Rule 608 and reviewed in
accordance with paragraph (b)(2) of Rule 608, if it appears to the
Commission that such action is necessary or appropriate in the public
interest, for the protection of investors, or the maintenance of fair
and orderly markets, to remove impediments to, and perfect the
mechanisms of, a national market system or otherwise in furtherance of
the purposes of the Act. The Commission is publishing this notice to
solicit comments from interested persons.
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    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 242.608.
    \3\ The Plan Participants (collectively, ``Participants'') are
the: BATS Exchange, Inc.; BATS Y-Exchange, Inc.; Chicago Board
Options Exchange, Incorporated; Chicago Stock Exchange, Inc.; EDGA
Exchange, Inc.; EDGX Exchange, Inc.; Financial Industry Regulatory
Authority, Inc.; International Securities Exchange LLC; NASDAQ OMX
BX, Inc.; NASDAQ OMX PHLX LLC; Nasdaq Stock Market LLC; National
Stock Exchange, Inc.; New York Stock Exchange LLC; NYSE MKT LLC; and
NYSE Arca, Inc.
    \4\ The Plan governs the collection, processing, and
dissemination on a consolidated basis of quotation information and
transaction reports in Eligible Securities for each of its
Participants. This consolidated information informs investors of the
current quotation and recent trade prices of Nasdaq securities. It
enables investors to ascertain from one data source the current
prices in all the markets trading Nasdaq securities. The Plan serves
as the required transaction reporting plan for its Participants,
which is a prerequisite for their trading Eligible Securities. See
Securities Exchange Act Release No. 55647 (April 19, 2007) 72 FR
20891 (April 26, 2007).
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I. Rule 608(a)

A. Purpose of the Amendments

    The Participants propose to revise the metric by which the
Participants calculate the annual increase in the Enterprise Maximum.
    Paragraph (e) of Exhibit 2 to the Plan provides that an entity that
is registered as a broker/dealer under the Securities Exchange Act of
1934 is not required to pay more than the ``Enterprise Maximum'' for
any month for each entitlement system. The ``Enterprise Maximum''
equals the aggregate amount of fees payable for distribution of UTP
Level 1 Service to nonprofessional subscribers that are brokerage
account customers of the broker/dealer. Paragraph (e) provides that the
Enterprise Maximum shall increase by the ``Annual Increase Amount''
each year.
    Currently, the ``Annual Increase Amount'' for any calendar year
equals the percentage increase in the annual composite share volume for
the preceding calendar year, subject to a maximum annual increase of
five percent; provided, however, that the Participants may determine to
waive the ``Annual Increase Amount'' for any calendar year.
    In this amendment, the Participants propose to change the
methodology for calculating the ``Annual Increase Amount.'' For each
calendar year, the proposed formulation would permit an increase in the
monthly enterprise maximum provided that no such annual increase could
exceed four percent of the then current Enterprise Maximum amount.
    This proposed means for determining the increase in the broker-
dealer Enterprise Maximum would reduce the amount of any one year's
permissible increase from five percent to four percent and would better
reflect inflation than does the current means. The maximum four percent
increase is consistent with the average cost of living adjustment
(``COLA'') as published by the Social Security Administration for the
past 38 years.
    The Participants adopted the Enterprise Maximum in 2010 and set it
at $600,000 for that year. It currently remains at $600,000. They
propose to increase the amount of the Enterprise Maximum by four
percent to $624,000, effective April 1, 2013. The number of firms
reaching the enterprise caps is minimal.

B. Governing or Constituent Documents

    Not applicable.

C. Implementation of Amendment

    All of the Participants have manifested their approval of the
proposed Amendment by means of their execution of the Amendment. The
Participants propose to make the rate changes effective as of April 1,
2013.

D. Development and Implementation Phases

    Not applicable.

E. Analysis of Impact on Competition

    The proposed Amendment does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Exchange Act.
    The Participants in the NASDAQ/UTP Plan have not raised the amount
of the Enterprise Maximum since they first adopted it in 2010. The
change would affect a very small number of broker-dealers, as few firms
take advantage of the Enterprise Maximum.
    In addition, the proposed change to the metric for calculating the
annual increase in the Enterprise Maximum is identical to the metric
that the Participants in the CTA and CQ Plans have adopted for their
enterprise maximums. As a result, this Amendment promotes consistency
in price structures among the national market system plans and would
make market data fees easier to administer.
    In the Participants' view, the proposed fee schedule would allow
broker-dealers with large numbers of nonprofessional subscriber
brokerage account customers to contribute an appropriate amount for
their receipt and use of market data under the Plan. The proposed fee
change would provide for an equitable allocation of dues, fees, and
other charges among broker-dealers, vendors, end users and others
receiving and using market data made available under the Plans.
    The Participants would apply the revised metric uniformly to all
broker-dealers qualifying for the Enterprise Maximum and do not believe
that the proposed change introduces terms that are unreasonably
discriminatory.

F. Written Understanding or Agreements Relating to Interpretation of,
or Participation in, Plan

    The Participants have no written understandings or agreements
relating to interpretation of the Plan as a result of the Amendment.

G. Approval by Sponsors in Accordance With Plan

    Each of the Plan's Participants has executed a written Amendment to
the Plan.

H. Description of Operation of Facility Contemplated by the Proposed
Amendment

    Not applicable.

I. Terms and Conditions of Access

    See Item A(1) above.

J. Method of Determination and Imposition, and Amount of, Fees and
Charges

    The Participants believe that the proposed change to the metric for
calculating the annual increase in the Enterprise Maximum provides a
fair basis for taking inflation into account for the Enterprise
Maximum. They believe it is fair and reasonable and provides for an
equitable allocation of dues, fees, and other charges among vendors,
data recipients and other persons using the Participants' facilities.

K. Method and Frequency of Processor Evaluation

    Not applicable.

L. Dispute Resolution

    Not applicable.

II. Rule 601(a)

A. Equity Securities for Which Transaction Reports Shall Be Required by
the Plan

    Not applicable.

B. Reporting Requirements

    Not applicable.

C. Manner of Collecting, Processing, Sequencing, Making Available and
Disseminating Last Sale Information

    Not applicable.

D. Manner of Consolidation

    Not applicable.

E. Standards and Methods Ensuring Promptness, Accuracy and Completeness
of Transaction Reports

    Not applicable.

F. Rules and Procedures Addressed to Fraudulent or Manipulative
Dissemination

    Not applicable.

G. Terms of Access to Transaction Reports

    Not applicable.

H. Identification of Marketplace of Execution

    Not Applicable.

III. Solicitation of Comments

    The Commission seeks general comments on Amendment No. 27.
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposal 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 S7-24-89 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.

All submissions should refer to File Number S7-24-89. 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 Web site (http://www.sec.gov/rules/sro.shtml). Copies of
the submission, all written statements with respect to the proposed
Plan Amendment that are filed with the Commission, and all written
communications relating to the proposed Plan Amendment 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 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 Web
site viewing and printing at the Office of the Secretary of the
Committee, currently located at the CBOE, 400 S. LaSalle Street,
Chicago, IL 60605. 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 S7-24-
89 and should be submitted on or before April 18, 2013.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\5\
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    \5\ 17 CFR 200.30-3(a)(27).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-07191 Filed 3-27-13; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 82, Number 158 (Thursday, August 17, 2017)]
[Rules and Regulations]
[Pages 39027-39029]
[FR Doc No: 2017-17244]

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 52

[EPA-R04-OAR-2007-0085; FRL-9966-24-Region 4]

Air Plan Approval; NC; Air Curtain Burners

AGENCY: Environmental Protection Agency.

ACTION: Direct final rule.

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SUMMARY: The Environmental Protection Agency (EPA) is taking final
action to approve portions of revisions to the North Carolina State
Implementation Plan (SIP) submitted by the State of North Carolina
through the North Carolina Department of Environmental Quality
(formerly the North Carolina Department of Environment and Natural
Resources), Division of Air Quality (DAQ), on October 14, 2004, March
24, 2006, and January 31, 2008. The revisions which EPA is approving
are changes to the air curtain burner regulation of the North Carolina
SIP. These revisions are part of North Carolina's strategy to meet and
maintain the national ambient air quality standards (NAAQS). EPA has
taken or will take action with respect to all other portions of these
SIP revisions. This action is being taken pursuant to the Clean Air Act
(CAA or Act) and its implementing regulations.

DATES: This direct final rule is effective October 16, 2017 without
further notice, unless EPA receives adverse comment by September 18,
2017. If adverse comment is received, EPA will publish a timely
withdrawal of the direct final rule in the Federal Register and inform
the public that the rule will not take effect.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-R04-
OAR-2007-0085 at http://www.regulations.gov. Follow the online
instructions for submitting comments. Once submitted, comments cannot
be edited or removed from Regulations.gov. EPA may publish any comment
received to its public docket. Do not submit electronically any
information you consider to be Confidential Business Information (CBI)
or other information whose disclosure is restricted by statute.
Multimedia submissions (audio, video, etc.) must be accompanied by a
written comment. The written comment is considered the official comment
and should include discussion of all points you wish to make. EPA will
generally not consider comments or comment contents located outside of
the primary submission (i.e. on the web, cloud, or other file sharing
system). For additional submission methods, the full EPA public comment
policy, information about CBI or multimedia submissions, and general
guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

FOR FURTHER INFORMATION CONTACT: Sean Lakeman or Nacosta C. Ward, Air
Regulatory Management Section, Air Planning and Implementation Branch,
Air, Pesticides and Toxics Management Division, U.S. Environmental
Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia
30303-8960. Mr. Lakeman can be reached via telephone at<PHONE_NUMBER>
or via electronic mail at<EMAIL_ADDRESS>Ms. Ward can be reached
via telephone at<PHONE_NUMBER>, or via electronic mail at
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Background

    In this rulemaking, EPA is taking direct final action to approve
portions of the revisions to the North Carolina SIP submitted on
October 14, 2004, March 24, 2006, and January 31, 2008. EPA is taking
direct final action on the changes to 15A NCAC Subchapter 2D--Air
Pollution Control Requirements, Section .1904, Air Curtain Burners.
These changes are a part of North Carolina's strategy to attain and
maintain the NAAQS and are approvable into the North Carolina SIP
pursuant to section 110 of the CAA. EPA is not taking action on 15A
NCAC Subchapter 2D--Air Pollution Control Requirements, Section .1201,
Purpose and Scope, submitted on January 31, 2008, because this rule
pertains to incinerators and addresses emission guidelines under CAA
sections 111(d) and 129 and 40 CFR part 60; it is not a part of the
federally-approved SIP. EPA has taken or will take separate action on
all other portions of these SIP submissions.

II. Analysis of the State Submittals

    North Carolina submitted revisions to 15A NCAC Subchapter 2D--Air
Pollution Control Requirements, Section .1904, Air Curtain Burners for
incorporation into the federally-approved SIP. Detailed descriptions of
the changes are below:

A. Changes to 2D Section .1904--Submitted October 14, 2004

    The changes contained in the October 14, 2004, SIP submission
require that permits be obtained for air curtain burners as defined by
40 CFR 60.2245 through 60.2265, permanent burning sites or materials
transported from burning site to burning site. These permitted air
curtain burners must also have a certified visible emissions reader
onsite at all times and during the operation of the burner to ensure
that the visible emissions can be read for compliance purposes. A
provision has also been added to cease operation of air curtain burners
in fine particulate matter (PM2.5) and ozone nonattainment
areas on ozone action days with status ``orange'' or above.
    North Carolina's submission modifies the provision which governs
air curtain burning where burning should be at least 500 feet away from
any dwelling, group of dwellings, or commercial or institutional
establishment or other occupied structure not located on the property
where the burning is conducted. These burning occurrences must be
approved before the initiation of the burn. The daily log at permanent
air curtain burner sites must be maintained onsite for two years and be
available for inspection. If an owner or operator is using a different
technology or method other than an air curtain burner as defined under
2D Section .1902,\1\ the owner or operator must demonstrate that the
burner is at least as effective. The revision also specifies that if it
is a burner constructed after November 30, 1999, or has been modified
after June 1, 2001, it must comply with 40 CFR 60.2245 through 60.2265
(i.e., the ``Air Curtain Incinerators'' portion of 40 CFR part 60,
subpart CCCC (Standards of Performance for Commercial and Industrial
Solid Waste Incineration Units).
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    \1\ ``Air Curtain Burner'' as defined in 2D Section .1902 is a
stationary or portable combustion device that directs a plane of
high velocity forced draft air through a manifold head into a pit or
container with vertical walls in such a manner as to maintain a
curtain of air over the surface of the pit and a circulating motion
of air under the curtain.
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    This SIP revision increases the six-minute average plume opacity
limit during operation from five percent to ten percent. North Carolina
states that the purpose of this change is to align the state rule with
federal requirements. The revision also extends the allowed startup
time of the burners from 30 to 45 minutes. The revision does not change
an existing allowance for one six-minute period with an average opacity
of more than ten percent but no more than 35 percent during any one-
hour period.
    On April 11, 2017, DAQ submitted a non-interference or section
110(l) demonstration which describes how these changes will not
interfere with the attainment and maintenance of the NAAQS. North
Carolina states there are

currently seven air curtain burners in the State that are subject to 2D
Section .1904 but that, due to source size and construction
commencement dates, none are subject to 40 CFR part 60, subpart CCCC.
Additionally, North Carolina states that any change in source emissions
associated with the alignment of the opacity limit of 2D Section .1904
with the federal regulations would be minimal. North Carolina reports
that these facilities are not routinely operational, as they are used
primarily for elimination of debris after severe storms. North Carolina
also demonstrates that reported pollutant emissions from these units
have been very low and that the design values in the counties closest
to them (all in the eastern part of the State) are well below the Fine
Particulate Matter NAAQS. North Carolina also notes that there are
currently no nonattainment areas for any NAAQS in the State and that
these changes to the SIP are not anticipated to cause any area to come
out of compliance with the NAAQS.

B. Changes to Section .1904--Submitted March 24, 2006

    The changes contained in the March 24, 2006, SIP submission are
clarifications to existing text in the regulation. The changes make the
regulation applicable to air curtain burners in general and not only
those currently identified in paragraph (a), which are burners subject
to 40 CFR 60.2245-60.2265 or located at permanent burning sites or
where materials are transported in from another burning site. The term
``ozone forecast area'' is also being replaced with ``air quality
forecast area'' in order to address all pollutants instead of only
ozone.

C. Changes to Section. 1904--Submitted January 31, 2008

    The changes contained in the January 31, 2008, SIP submission
expand the scope of the types of air curtain burners for which air
quality permits must be issued to also include air curtain burners
subject to 40 CFR 60.2810 through 60.2870, 60.2970 through 60.2975, and
60.3062 through 60.3069. The changes specify the opacity standards to
which the various air curtain burner types are subject as outlined in
40 CFR part 60, instead of the opacity standards as previously outlined
in the existing subparagraphs of the regulation. Lastly, the
recordkeeping and reporting requirements have also been expanded to
note the applicability of the additional requirements for owner and
operators of air curtain burners subject to 40 CFR 60.2810 through
60.2870, 60.2970 through 60.2975, and 60.3062 through 60.3069.

III. Incorporation by Reference

    In this rule, EPA is finalizing regulatory text that includes
incorporation by reference. In accordance with requirements of 1 CFR
51.5, EPA is finalizing the incorporation by reference of 15A NCAC
Subchapter 2D--Air Pollution Control Requirements, Sect. .1904, Air
Curtain Burners effective March 11, 2004, November 10, 2005, and July
1, 2007, revising air curtain burner requirements. Therefore, these
materials have been approved by EPA for inclusion in the State
implementation plan, have been incorporated by reference by EPA into
that plan, are fully federally-enforceable under sections 110 and 113
of the CAA as of the effective date of the final rulemaking of EPA's
approval, and will be incorporated by reference by the Director of the
Federal Register in the next update to the SIP compilation.\2\ EPA has
made, and will continue to make, these materials generally available
through www.regulations.gov and/or at the EPA Region 4 Office (please
contact the person identified in the For Further Information Contact
section of this preamble for more information).
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    \2\ 62 FR 27968 (May 22, 1997).
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IV. Final Action

    EPA is approving the aforementioned revisions to the North Carolina
SIP submitted by the State of North Carolina on October 14, 2004, March
24, 2006, and January 31, 2008, pursuant to section 110 because these
revisions are consistent with the CAA. Changes to the other sections in
these submissions will be or have been processed in a separate action,
as appropriate, for approval into the North Carolina SIP. As noted
above, EPA is not taking action on changes to 15A NCAC Subchapter 2D--
Air Pollution Control Requirements, Section .1201, Purpose and Scope,
as submitted on January 31, 2008, because this rule pertains to
incinerators and addresses emission guidelines under CAA sections
111(d) and 129 and 40 CFR part 60 and is not a part of the federally-
approved SIP.
    EPA is publishing this rule without prior proposal because the
Agency views this as a noncontroversial submittal and anticipates no
adverse comments. However, in the proposed rules section of this
Federal Register publication, EPA is publishing a separate document
that will serve as the proposal to approve the SIP revision should
adverse comments be filed. This rule will be effective October 16, 2017
without further notice unless the Agency receives adverse comments by
September 18, 2017.
    If EPA receives such comments, then EPA will publish a document
withdrawing the final rule and informing the public that the rule will
not take effect. All adverse comments received will then be addressed
in a subsequent final rule based on the proposed rule. EPA will not
institute a second comment period. Parties interested in commenting
should do so at this time. If no such comments are received, the public
is advised that this rule will be effective on October 16, 2017 and no
further action will be taken on the proposed rule.

V. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP
submission that complies with the provisions of the Act and applicable
federal regulations. See 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in
reviewing SIP submissions, EPA's role is to approve state choices,
provided that they meet the criteria of the CAA. Accordingly, this
action merely approves state law as meeting federal requirements and
does not impose additional requirements beyond those imposed by state
law. For that reason, this action:
     Is not a significant regulatory action subject to review
by the Office of Management and Budget under Executive Orders 12866 (58
FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);
     Does not impose an information collection burden under the
provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);
     Is certified as not having a significant economic impact
on a substantial number of small entities under the Regulatory
Flexibility Act (5 U.S.C. 601 et seq.);
     Does not contain any unfunded mandate or significantly or
uniquely affect small governments, as described in the Unfunded
Mandates Reform Act of 1995 (Pub. L. 104-4);
     Does not have Federalism implications as specified in
Executive Order 13132 (64 FR 43255, August 10, 1999);
     Is not an economically significant regulatory action based
on health or safety risks subject to Executive Order 13045 (62 FR
19885, April 23, 1997);
     Is not a significant regulatory action subject to
Executive Order 13211 (66 FR 28355, May 22, 2001);

     Is not subject to requirements of section 12(d) of the
National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272
note) because application of those requirements would be inconsistent
with the CAA; and
     Does not provide EPA with the discretionary authority to
address, as appropriate, disproportionate human health or environmental
effects, using practicable and legally permissible methods, under
Executive Order 12898 (59 FR 7629, February 16, 1994).
    The SIP is not approved to apply on any Indian reservation land or
in any other area where EPA or an Indian tribe has demonstrated that a
tribe has jurisdiction. In those areas of Indian country, the rule does
not have tribal implications as specified by Executive Order 13175 (65
FR 67249, November 9, 2000), nor will it impose substantial direct
costs on tribal governments or preempt tribal law.
    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the
Small Business Regulatory Enforcement Fairness Act of 1996, generally
provides that before a rule may take effect, the agency promulgating
the rule must submit a rule report, which includes a copy of the rule,
to each House of the Congress and to the Comptroller General of the
United States. EPA will submit a report containing this action and
other required information to the U.S. Senate, the U.S. House of
Representatives, and the Comptroller General of the United States prior
to publication of the rule in the Federal Register. A major rule cannot
take effect until 60 days after it is published in the Federal
Register. This action is not a ``major rule'' as defined by 5 U.S.C.
804(2).
    Under section 307(b)(1) of the CAA, petitions for judicial review
of this action must be filed in the United States Court of Appeals for
the appropriate circuit by October 16, 2017. Filing a petition for
reconsideration by the Administrator of this final rule does not affect
the finality of this action for the purposes of judicial review nor
does it extend the time within which a petition for judicial review may
be filed, and shall not postpone the effectiveness of such rule or
action. Parties with objections to this direct final rule are
encouraged to file a comment in response to the parallel notice of
proposed rulemaking for this action published in the proposed rules
section of today's Federal Register, rather than file an immediate
petition for judicial review of this direct final rule, so that EPA can
withdraw this direct final rule and address the comment in the proposed
rulemaking. This action may not be challenged later in proceedings to
enforce its requirements. See section 307(b)(2).

List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide,
Incorporation by reference, Intergovernmental relations, Lead, Nitrogen
dioxide, Ozone, Particulate matter, Reporting and recordkeeping
requirements, Sulfur oxides, Volatile organic compounds.

    Dated: August 4, 2017.
V. Anne Heard,
Acting Regional Administrator, Region 4.
    40 CFR part 52 is amended as follows:

PART 52--APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS

0
1. The authority citation for part 52 continues to read as follows:

    Authority: 42 U.S.C. 7401 et seq.

Subpart II--North Carolina

0
2. In Sec.  52.1770, the table in paragraph (c) is amended by revising
the entry ``Sect .1904'' to read as follows:

Sec.  52.1770  Identification of plan.

* * * * *
    (c) * * *

                                Table 1--EPA-Approved North Carolina Regulations
----------------------------------------------------------------------------------------------------------------
                                                       State
         State citation            Title/subject     effective   EPA approval date           Explanation
                                                        date
----------------------------------------------------------------------------------------------------------------
                                Subchapter 2D Air Pollution Control Requirements
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
----------------------------------------------------------------------------------------------------------------
                                           Section .1900 Open Burning
----------------------------------------------------------------------------------------------------------------

                                                  * * * * * * *
Sect .1904.....................  Air Curtain           7/1/2007  8/17/2017,         ............................
                                  Burners.                        [insert Federal
                                                                  Register
                                                                  citation].

                                                  * * * * * * *
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* * * * *
[FR Doc. 2017-17244 Filed 8-16-17; 8:45 am]
 BILLING CODE 6560-50-P


[Federal Register Volume 77, Number 91 (Thursday, May 10, 2012)]
[Notices]
[Pages 27503-27505]
[FR Doc No: 2012-11243]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-66919; File No. SR-DTC-2012-02]

Self-Regulatory Organizations; The Depository Trust Company;
Order Granting Approval of a Proposed Rule Change To Amend Rules
Relating to the Issuance of and Maturity Presentment Processing for
Money Market Instruments

May 3, 2012.

I. Introduction

    On March 8, 2012, The Depository Trust Company (``DTC'') filed
proposed rule change SR-DTC-2012-02 with the Securities and Exchange
Commission (``Commission'') pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'').\1\ Notice of the proposed
rule change was published in the Federal Register on March 26, 2012.\2\
The Commission received no comment letters. For the reasons discussed
below, the Commission is granting approval of the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ Securities Exchange Act Release No. 66630 (March 20, 2012),
77 FR 17534 (March 26, 2012).
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II. Description

    The Maturity Presentment processing for money market instruments
(``MMIs'') is initiated automatically by DTC each morning for all of
the MMIs maturing that day.\3\ The automatic process electronically
sweeps all maturing positions of MMI CUSIPs from a participant's
accounts and credits the participant's account with the amount of the
payments to be received with respect to such presentments. The matured
MMIs are delivered to the account of the applicable issuing or paying
agent (``IPA''),\4\ also a DTC

participant, and the IPA's account is debited for the amount of the
maturity proceeds. The debited amount will be included in the IPA's net
settlement amount. Similarly, the credits of participants that
presented maturing MMIs will be included in those participants' net
settlement amount.
---------------------------------------------------------------------------

    \3\ The term ``Maturity Presentment'' is defined in Rule 1 of
DTC's Rules and Procedures as a Delivery Versus Payment of matured
MMI securities from the account of a presenting participant to the
designated paying agent account for that issue as provided for in
Rule 9(C) and as specified in DTC's procedures.
    \4\ Rule 1 of DTC's Rules and Procedures defines the term ``MMI
Issuing Agent'' generally as a participant acting as an issuing
agent for an issuer with respect to a particular issue of MMI
securities of that issuer and an ``MMI Paying Agent'' generally as a
participant acting as a paying agent for an issuer with respect to a
particular issue of MMI securities of that issuer. Since MMI Issuing
Agents and MMI Paying Agents are often a single entity, this filing
refers to both entities collectively as ``IPAs.''
---------------------------------------------------------------------------

    MMI issuers and IPAs commonly view the primary source of funding
for payments of MMI maturity presentments as flowing from new issuances
of MMIs in the same program by that MMI issuer on that day. When the
MMI issuer issues more new MMIs than the number of MMIs maturing, the
MMI issuer would have no net funds payment due to the IPA on that day.
When an issuer has more maturing MMIs than new issuances, it would have
an obligation to pay to the IPA the net amount of the MMIs maturing
that day over the new issuance. When net maturity presentments exceed
issuances on a day, IPAs at their discretion may provide significant
intraday credit to issuers for the excess. However, the IPA as an agent
of an issuer is not obligated to fund the presentments at DTC unless it
receives payment from the issuer.
    The business relationships between IPAs and their MMI issuers play
a key role in determining if an IPA will execute a refusal to pay at
DTC with respect to presentment of an MMI issuance for which the IPA
has not received funds from the MMI issuer. Because maturity
presentments of an issuer's MMIs for which the IPA acts are processed
automatically and randomly against the IPA's account, an IPA is
permitted to refuse to pay for all of an issuer's maturities in an MMI
program.\5\ An IPA that refuses payment on an MMI maturity must
communicate its intention to DTC using the DTC Participant Terminal/
Browser Service (PTS/PBS) MMRP function. This function allows the IPA
to enter a refusal to pay instruction for a particular issuer, referred
to as an Issuer Failure/Refusal to Pay (``RTP''), up to 3:00 p.m.
Eastern Time (``ET'') on the date of the relevant maturity presentment.
Such an instruction causes DTC to reverse all transactions related to
the relevant maturity presentment. An IPA RTP may have a significant
market impact on the issuer's reputation and credit standing.
---------------------------------------------------------------------------

    \5\ DTC employs a four-character acronym to designate an
issuer's MMI program. An issuer can have multiple acronyms. The IPA
uses the acronym(s) when submitting an instruction of its refusal to
pay for a given issuer's program(s).
---------------------------------------------------------------------------

    In late 2009, DTC and the Securities Industry and Financial Markets
Association (``SIFMA'') formed the MMI Blue-Sky Task Force (``Task
Force'') to address systemic and unique market risks associated with
the MMI process, including those related to DTC's maturity presentment
processing. The Task Force, along other money market industry
members,\6\ determined that DTC's current MMI processing schedule
permits issuance and other transaction activity that can affect an
issuer's net funding amount or proceeds after the 3:00 p.m. E.T.
deadline for RTP instructions.\7\ Accordingly, DTC is amending certain
provisions in its Settlement Service Guide in order to provide
increased transparency for IPAs before the 3:00 p.m. RTP deadline,
which should in turn assist IPAs in making better informed credit
decisions when an issuer has more maturities than new issuances. The
rule changes to DTC's Settlement Service Guide, as approved, include:
---------------------------------------------------------------------------

    \6\ The money market industry members include the Commercial
Paper Issuers Working Group, which is comprised of both bank and
corporate commercial paper issuers, and the Asset Managers Forum,
whose membership consists solely of buy-side investors.
    \7\ The Task Force's short-term recommendations focused on
addressing the credit risk exposure that IPAs face because of a lack
of transparency around the amount an issuer must fund to cover its
maturities. The recommendations called for requiring issuers to fund
maturity presentments by 1:00 p.m. if there is a net debit and for
establishing new deadlines of 1:30 p.m. for the submission of all
new valued issuance to DTC and of 2:15 p.m. for receivers of new
valued issuance to accept delivery. These recommended new deadlines
were intended to give an IPA sufficient time to calculate its
exposure and if a funding shortfall exists work with the issuer to
resolve the deficiency before 3:00 p.m., which is DTC's deadline for
an IPA to fund the maturities or to issue an RTP. For more
information, see DTCC Press Release ``DTCC and SIFMA Release Task
Force Report Identifying Opportunities to Mitigate Systemic and
Credit Risk in Processing of Money Market Instruments'' (March 31,
2011), which can be found at www.dtcc.com/news/press/releases/2011/dtcc_sifma_task_force_report.php.
---------------------------------------------------------------------------

    1. Making all MMI issuance and deliver order transactions subject
to DTC's Receiver Authorized Delivery (``RAD'') function for approval
regardless of transaction value.\8\
---------------------------------------------------------------------------

    \8\ This change will eliminate the ability for a receiver to
``force'' a reclaim upon an IPA close to or after the 3:00 p.m. RTP
cutoff that would alter the amount of funding an issuer needs to
provide late in the day and would also eliminate matched reclaims
that currently override participant risk management controls.
---------------------------------------------------------------------------

    2. Adjusting the MMI valued new issuance cut-off time from 3:20
p.m. E.T. to 2:00 p.m. E.T.
    3. Requiring use of RAD for approval of all MMI issuance and
deliver order transactions, regardless of value, and establishing a new
MMI cutoff time of 2:45 p.m. E.T. instead of the current 3:30 p.m.
E.T.\9\
---------------------------------------------------------------------------

    \9\ If a transaction is not approved in RAD by 2:45 p.m. E.T.,
the transaction will drop and will need to be resubmitted.

DTC will implement the changes described above upon approval of this
proposed rule change by the Commission.\10\
---------------------------------------------------------------------------

    \10\ In addition to the changes described above, DTC is also
making unrelated technical changes to its Settlement Service Guide
in order to conform its rules to its current practices and to a
previously approved rule filing, SR-DTC-2011-01. Securities Exchange
Release Act No. 34-63775 (January 26, 2011), 76 FR 5843 (February 2,
2011).
---------------------------------------------------------------------------

III. Discussion

    Section 17A(b)(3)(F) of the Act requires, among other things, that
the rules of a clearing agency be designed to promote the prompt and
accurate clearance and settlement of securities transactions and to
remove impediments to and perfect the mechanism of a national system
for the prompt and accurate clearance and settlement of securities
transactions.\11\ The Commission believes that the changes being made
by this proposed rule change should help IPAs to determine earlier in
the day if there is a funding shortfall with respect to an issuer and
in turn help reduce late day reversals of MMI transactions by IPAs.
Additionally, the changes to the Settlement Service Guide should serve
to reinforce consistent MMI business practices by implementing earlier
deadlines for issuances processing and receiver approvals and thereby
make the processing of MMI issuances and maturities more efficient.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

    Accordingly, for the reasons stated above the Commission believes
that the proposed rule change is consistent with DTC's obligation under
Section 17A of the Act and the rules and regulations thereunder.\12\
---------------------------------------------------------------------------

    \12\ In approving this proposal, the Commission has considered
its impact on efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
---------------------------------------------------------------------------

IV. Conclusion

    On the basis of the foregoing, the Commission finds that the
proposed rule change is consistent with the requirements of the Act,
particularly with the requirements of Section 17A of the Act, and the
rules and regulations thereunder.
    It is therefore ordered, pursuant to Section 19(b)(2) of the Act,
that the proposed rule change (File No. SR-DTC-2012-02) be and hereby
is approved.

    For the Commission by the Division of Trading and Markets,
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-11243 Filed 5-9-12; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 82, Number 153 (Thursday, August 10, 2017)]
[Notices]
[Pages 37479-37484]
[FR Doc No: 2017-16829]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81315; File No. SR-CHX-2017-12]

Self-Regulatory Organizations; Chicago Stock Exchange, Inc.;
Notice of Filing of Proposed Rule Change Regarding Qualified Contingent
Trades and Related Information Recording Obligations by Certain
Participants

August 4, 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 July 26, 2017, the Chicago Stock Exchange, Inc. (``CHX'' or
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    CHX proposes to amend the Rules of the Exchange (``CHX Rules'')
regarding Qualified Contingent Trades (``QCTs'') \3\ and related
information recording obligations by certain Participants.\4\ The text
of this proposed rule change is available on the Exchange's Web site at
http://www.chx.com/regulatory-operations/rule-filings/, at the
principal office of the Exchange, and at the Commission's Public
Reference Room.
---------------------------------------------------------------------------

    \3\ See infra Section A.1(1).
    \4\ A Participant is a ``member'' of the Exchange for purposes
of the Act. See CHX Article 1, Rule 1(s).
---------------------------------------------------------------------------

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

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

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

1. Purpose
    The Exchange proposes to amend CHX Rules to effect the following
changes:
     Clarify the operation of cross orders \5\ and Cross With
Size handling.\6\
---------------------------------------------------------------------------

    \5\ See CHX Article 1, Rule 2(a)(2).
    \6\ See CHX Article 1, Rule 2(g)(1).
---------------------------------------------------------------------------

     Only permit Participants that are registered with the
Exchange as Institutional Brokers (``IBs'') \7\ to submit an NMS stock
component order of a

QCT (``QCT Cross'') to the Matching System.\8\
---------------------------------------------------------------------------

    \7\ See CHX Article 1, Rule 1(n); see also generally CHX Article
17.
    \8\ The Matching System is an automated order execution system,
which is a part of the Exchange's ``Trading Facilities,'' as defined
under CHX Article 1, Rule 1(z).
---------------------------------------------------------------------------

     Clarify the scope of information recording obligations
under current Article 11, Rule 3.
     Adopt rules describing the CHX Broker Back Office System
(``BBOS''), a trade management system developed and maintained by the
Exchange.
     Require IBs to record certain information in the BBOS
regarding component orders and trades related to QCT Crosses executed
within the Matching System.
     Clarify the agency, principal and error accounts
requirements for IBs.
(1) Background
    In 2006,\9\ the Commission granted an exemption from Rule 611(a) of
Regulation NMS \10\ (``QCT Exemption'') for any trade-throughs caused
by the execution of an order involving one or more NMS stocks (each an
``Exempted NMS Stock Transaction'') that are components of a QCT, which
was modified in 2008 to eliminate the Size Condition.\11\ Consistent
with the QCT Exemption, the Exchange permits Participants to submit
cross orders marked with the QCT modifier (i.e., QCT Crosses) to the
Matching System to effect transactions that comprise the NMS stock
components of QCTs.\12\
---------------------------------------------------------------------------

    \9\ See Securities Exchange Act Release No. 54389 (August 31,
2006), 71 FR 52829 (September 7, 2006) (``QCT Exemptive Order'').
    \10\ 17 CFR 242.611(a).
    \11\ ``Qualified contingent trade'' is defined as ``a
transaction consisting of two or more component orders, executed as
agent or principal where: (1) At least one component order is in an
NMS stock; (2) All components are effected with a product or price
contingency that either has been agreed to by the respective
counterparties or arranged for by a broker-dealer as principal or
agent; (3) The execution of one component is contingent upon the
execution of all other components at or near the same time; (4) The
specific relationship between the component orders (e.g., the spread
between the prices of the component orders) is determined at the
time the contingent order is placed; (5) The component orders bear a
derivative relationship to one another, represent different classes
of shares of the same issuer, or involve the securities of
participants in mergers or with intentions to merge that have been
announced or since cancelled; and (6) The Exempted NMS Stock
Transaction is fully hedged (without regard to any prior existing
position) as a result of the other components of the contingent
trade. See Securities Exchange Act Release No. 57620 (April 4,
2008), 73 FR 19271 (April 9, 2008) (``Modified QCT Exemptive
Order''). In 2008, the Commission modified the QCT Exemptive Order
to eliminate a seventh requirement (``Size Condition'') that the
Exempted NMS Stock Transaction that is part of a contingent trade
involves at least 10,000 shares or has a market value of at least
$200,000. See id. at 19274.
    \12\ While CHX Rules currently permit any Participant to submit
a QCT Cross, in practice, only IBs have submitted QCT Crosses, in
large part due to the complexities of coordinating the execution of
the various components of a QCT and allocating positions to the
various parties to the QCT.
---------------------------------------------------------------------------

    Mechanically, upon receipt of a QCT Cross, the Exchange will
immediately execute the QCT Cross without regard to the protected
quotations of away markets if the state of the CHX limit order book
(``CHX book'') in the relevant security would permit the QCT Cross to
execute within the Matching System.\13\ If the QCT Cross is blocked by
an order resting on the CHX book, the QCT Cross will be immediately
cancelled. The Exchange does not conduct a pre-execution verification
of each QCT Cross for compliance with the terms of the QCT Exemption
due to the practical difficulties of conducting such verification
within the constraints of the ``at or near the same time'' requirement
for the execution of the component orders that comprise the QCT.\14\
Instead, the Exchange maintains and operates a comprehensive
Surveillance and Examination program that, among other things, reviews
executed QCT Crosses for compliance with CHX Rules and the QCT
Exemption.
---------------------------------------------------------------------------

    \13\ See CHX Article 1, Rule 2(a)(2).
    \14\ See CHX Article 1, Rule 2(b)(2)(E)(iii); see also supra
note 11.
---------------------------------------------------------------------------

    The Exchange believes that the operation of the Matching System and
the Surveillance and Examination program, in general, and as applied to
the execution and review of QCT Crosses, in particular, are
``reasonably designed'' in compliance with the requirements of Rule
611(a)(1) of the Regulation NMS.\15\ The Exchange also regularly
surveils to ascertain the effectiveness of its policies and procedures
required by Rule 611(a)(1) and has taken prompt action to remedy
deficiencies in such policies and procedures, consistent with the
requirements of Rule 611(a)(2) of Regulation NMS.\16\ As part of its
ongoing effort to update and optimize the Surveillance and Examination
program, the Exchange has developed and deployed BBOS, a trade
management system that, among other things, permits the Exchange to
review additional information to identify the specific component
transactions \17\ that are being used to hedge executed QCT Crosses.
Currently, the Exchange encourages its IBs to include certain
information for away executions related to QCT Crosses submitted to the
Matching System into the BBOS,\18\ which the Exchange uses to verify
that the components to the QCT satisfy the derivative relationship and
fully-hedged requirements of the QCT Exemption.\19\ In addition, CHX
Rules require IBs to input all orders and related information \20\ it
receives for execution into an automated system (e.g., Brokerplex
\21\), which includes QCT Crosses.
---------------------------------------------------------------------------

    \15\ 17 CFR 242.611(a)(1).
    \16\ 17 CFR 242.611(a)(2).
    \17\ Currently, the vast majority of component transactions used
to hedge QCT Crosses involve exchange traded options. As such, BBOS
permits users to automatically link QCT Crosses with specific
exchange-traded options transactions via the use of unique sequence
numbers. While the BBOS permits the entry of other types of
component transactions, such as futures transactions, the full
details of such component transactions must be entered manually. See
infra note 18.
    \18\ Current data fields include: QCT Type; Related Exchange;
Print Time; Expiration Year; Expiration Month; Price; Contracts;
Strike Price; Call/Put; Volume; and Short Sale Indicator. The
alternatives under ``QCT Type'' include exchange traded options,
over-the-counter traded options, FLEX Options, equities, futures and
``other.'' See id.
    \19\ See supra note 11.
    \20\ See CHX Article 11, Rule 3(a) and (b).
    \21\ See CHX Article 17, Rule 5.
---------------------------------------------------------------------------

    The Exchange now proposes various amendments to the CHX Rules in
order to clarify the operation of cross orders, to clarify the scope of
certain Participant obligations and to codify current practices related
to the enhancement of the Exchange's oversight of QCTs.
(2) Amendments Related to Cross Orders
    The Exchange proposes to adopt various non-substantive amendments
to CHX Rules to clarify the operation of cross orders and Cross With
Size handling.\22\ Current Article 1, Rule 2(a)(2) defines cross order
as an order to buy and sell the same security at a specific price
better than the Working Price, as defined under Article 1, Rule 1(pp),
of all resting orders on the CHX Book and which would not constitute a
trade-through under Regulation NMS (including all applicable exceptions
and exemptions). The rule also provides that a cross order may
represent interest of one or more Participants of the Exchange, but may
only be executed in an increment permitted by Article 20, Rule
4(a)(7)(b). The rule then provides that a cross order may be subject to
special handling, pursuant to Article 20, Rule 2(g).
---------------------------------------------------------------------------

    \22\ See CHX Article 1, Rule 2(g)(1).
---------------------------------------------------------------------------

    While the current definition is technically accurate, the Exchange
believes that it can be amended to clarify that the pricing requirement
for cross orders is prerequisite for execution within the Matching
System, but not a prerequisite for submission into the Matching System.
That is, a cross order that does not meet the pricing requirement, and
is thus cancelled by

the Matching System, is still a cross order by definition, albeit not
an executable one. As such, the Exchange proposes to amend the first
---------------------------------------------------------------------------
paragraph of current Article 1, Rule 2(a)(2) to provide as follows:

    ``Cross order'': An order to buy and sell the same security at a
specific price. A cross order may only execute within the Matching
System if it is priced better than the Working Price, as defined
under Article 1, Rule 1(pp), of all resting orders on the CHX Book.
A cross order may represent interest of one or more Participants of
the Exchange, but may only be executed in an increment permitted by
Article 20, Rule 4(a)(7)(b). A cross order may be subject to special
handling, pursuant to paragraph (g) below.

    Similarly, the Exchange proposes to amend Article 1, Rule
2(g)(1)(A) to clarify the requirements for Cross With Size handling and
to remove redundant references to compliance various CHX Rules and
federal securities laws and regulations:

    ``Cross With Size'': A cross order (except any cross order
subject to Non-Regular Way Settlement) to buy and sell at least
5,000 shares of the same security with a total value of at least
$100,000 will execute, notwithstanding resting orders in the CHX
Book at the same price, where: (A) There are no resting orders on
the CHX Book with a Working Price, as defined under Article 1, Rule
1(pp), better than the cross order; and

    In addition, the Exchange proposes to amend Article 20, Rule 8(e)
to replace a redundant summary of the operation of cross orders and
Cross With Size handling with specific references to the relevant
rules. Also, since Cross With Size is a special handling for cross
orders and not a separate order type or order modifier, the Exchange
proposes to eliminate reference to ``Cross With Size,'' but to maintain
the citation to the relevant CHX Rules. Thus, amended Article 20, Rule
8(e) provides that ``Cross orders shall be handled pursuant to Article
1, Rule 2(a)(2) and Rule 2(g)(1) above.''
(3) Amendments Related to QCT Modifier
    As noted above,\23\ while CHX Rules permit any Participant to
submit QCT Crosses, in practice, non-IB Participants do not currently
submit QCT Crosses. Moreover, CHX Rules require only IBs to input
additional information into Brokerplex,\24\ which facilitates the
ability of the Exchange to gather crucial information related to its
review of QCT Crosses executed on the Exchange. Given that non-IBs do
not currently submit QCTs and the Surveillance and Examination program
is optimized to review QCT Crosses submitted by IBs, the Exchange
proposes to amend Article 1, Rule 2(b)(2)(E) to provide that QCT
Crosses may only be submitted by IBs.\25\ The Exchange believes that
the proposed restriction will ensure consistent recordkeeping
requirements related to QCTs for those Participants that submit QCT
Crosses. Also, given that any Participant may apply to register as an
IB,\26\ the Exchange submits that the proposal is not unfairly
discriminatory to non-IB Participants.\27\
---------------------------------------------------------------------------

    \23\ See supra Section A.1(1).
    \24\ See CHX Article 17, Rule 3.
    \25\ The Exchange also proposes to add the acronym ``QCT'' to
CHX Article 1, Rule 2(b)(2)(E) to clarify that the term ``QCT''
refers to ``Qualified Contingent Trade.''
    \26\ See CHX Article 17, Rule 1.
    \27\ See infra Section A.2.
---------------------------------------------------------------------------

(4) Clarifying Amendments to Recordkeeping Requirement for Certain
Participants
    The Exchange also proposes various non-substantive clarifying
amendments to Article 11, Rule 3 (Records of Orders and
Executions).\28\ Specifically, the Exchange proposes to amend Article
11, Rule 3(a) to clarify that the provisions of Article 11, Rule 3 only
apply to certain Participants described under Rule 3(e), which limits
the applicability of Article 11, Rule 3 to IBs, CHX-registered Market
Makers,\29\ Participants for whom the Exchange is the Designated
Examining Authority (``DEA'') and any other Participant to the extent
that the information under Article 11, Rule 3 is required by the rules
of the other self-regulatory organizations of which they are
members.\30\ Similarly, the Exchange proposes to amend the title of
Article 11, Rule 3 to provide ``Records of Orders and Executions by
Certain Participants,'' which better describes the scope of the rule
and distinguishes it from Article 11, Rule 2 (Maintenance of Books and
Records), which requires all Participants to comply with the
requirements of Rules 17a-3 \31\ and 17a-4 under the Exchange Act.\32\
---------------------------------------------------------------------------

    \28\ The provisions under current CHX Article 11, Rule 3 that
the Exchange is proposing to clarify were originally adopted in 2006
as part of the Exchange's transition to its current electronic
trading model. See Exchange Act Release No. 54550 (September 29,
2006), 71 FR 59563 (October 10, 2006) (SR-CHX-2006-05).
    \29\ See CHX Article 16, Rule 1.
    \30\ The Exchange proposes to amend Article 11, Rule 3(e) to
clarify that the provisions of Article 11, Rule 3 would apply to
IBs, Market Makers, Participants for which the Exchange is its DEA
and any other Participant to the extent that the information under
Article 11, Rule 3 is required by the Exchange Act and the rules
thereunder, as well as the rules of the other self-regulatory
organizations of which they are members. The Exchange believes that
this amendment is appropriate given that Participants are
``members'' of the Exchange, as defined under the Exchange Act, and
any provisions under the Exchange Act and the rules thereunder that
apply to a ``member'' of an exchange would apply to Participants.
See CHX Article 1, Rule 1(s).
    \31\ 17 CFR 240.17a-3.
    \32\ 17 CFR 240.17a-4.
---------------------------------------------------------------------------

    The Exchange further proposes to amend paragraph .01 under the
Interpretations and Policies of Article 11, Rule 3 to clarify that
proprietary orders, such as those submitted by Market Makers, fall
under the purview of Article 11, Rule 3. Specifically, while the second
sentence under paragraph .01 excludes from the scope of orders
described under Article 11, Rule 3(a) the actual decision to purchase
or sell a security by a Participant on a proprietary basis and not the
proprietary order itself, the Exchange believes that the sentence could
be misconstrued to exclude all proprietary orders from the scope of
Article 11, Rule 3. The Exchange also believes that current Article 11,
Rule 3(a)(1)-(3) adequately describes the types of orders subject to
current Article 11, Rule 3. Accordingly, the Exchange proposes to
delete the second sentence of paragraph .01 in its entirety.
    Current paragraph .03 under the Interpretations and Policies of
Article 11, Rule 3 provides, in pertinent part, that Article 11, Rule 3
shall not apply to orders sent or received through the Matching System
or through any other electronic system that the Exchange expressly
recognizes as providing the required information in a format acceptable
to the Exchange. The purpose of current paragraph .03 is to clarify
that Participants that submit or receive orders through Exchange-
approved electronic systems are not required to maintain a separate
record of the information required under Article 11, Rule 3. However,
the Exchange believes that paragraph .03 could be misconstrued as to
exclude orders sent or received through an Exchange-approved electronic
system from the scope of Article 11, Rule 3 entirely, which is
incorrect. Accordingly, the Exchange proposes to amend paragraph .03 to
provide that a Participant that sends or receives orders, cancellations
and executions, as applicable, through the Matching System or through
any other electronic systems that the Exchange expressly recognizes as
providing the required information in a format acceptable to the
Exchange is not required to maintain a separate record of such orders,
cancellations and executions.\33\ Moreover, the Exchange

proposes to add the term ``expressly'' before the term ``recognize''
under the second sentence of current paragraph .03 to be stylistically
consistent with the amended first sentence and to make other
grammatical amendments.
---------------------------------------------------------------------------

    \33\ The Exchange notes that the proposed amendment to paragraph
.03 would have no impact on a Participant's recordkeeping
obligations under Article 11, Rule 2, which requires, among other
things, that Participants comply with the recordkeeping requirements
of Rule 17a-3 under the Act. For example, the proposed amendment to
paragraph .03 would not impinge on a Participant's obligation
pursuant to Article 11, Rule 2 and Rule 17a-3(a)(6)(i) under the Act
to maintain a memorandum of each brokerage order, and of any other
instruction, given or received for the purchase or sale of
securities, whether executed or unexecuted.
---------------------------------------------------------------------------

(5) Proposed Recordkeeping Requirements for Away Component Trades for
QCT Crosses Executed Within the Matching System
    The Exchange proposes to require IBs to record certain
information\34\ for away QCT component orders and trades related to QCT
Crosses executed within the Matching System into the BBOS. While the
Exchange currently encourages IBs to enter such information into the
BBOS,\35\ the CHX Rules do not currently require IBs to do so. Given
that current Article 11, Rule 3(a)(1)-(3) does not contemplate such
component orders and trades, as some component orders may not originate
or otherwise be handled by the Participant, the Exchange proposes to
adopt Article 11, Rule 3(a)(4), which would bring within the scope of
Article 11, Rule 3 every component order and trade, whether handled by
the Participant or not, related to a QCT Cross that is submitted by the
Participant and executed within the Matching System. Correspondingly,
the Exchange proposes to amend the citation under Article 11, Rule 3(b)
to include proposed Article 11, Rule 3(a)(4).
---------------------------------------------------------------------------

    \34\ See supra Section A.1(1).
    \35\ See id.
---------------------------------------------------------------------------

    Moreover, the Exchange proposes to amend Article 11, Rule 3(b)(27)
\36\ to provide that subject to certain enumerated exceptions, each
Participant must accurately record, with respect to any cross orders
marked Qualified Contingent Trade executed within the Matching System,
(A) the date and time of receipt by the Participant of the
corresponding order from its customer and (B) all information specified
by the Exchange regarding any related component orders and trades
executed within the Matching System or away, which shall be entered
into the BBOS (as applicable), in a manner prescribed by the
Exchange.\37\
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    \36\ The Exchange proposes to move the current language under
current CHX Article 11, Rule 3(b)(27) to proposed CHX Article 11,
Rule 3(b)(28). Correspondingly, the Exchange proposes to amend
paragraph .06 of the Interpretations and Policies of CHX Article 11,
Rule 3 to contemplate the addition of Rule 3(b)(28).
    \37\ The required information would be identical to the current
data fields available in the BBOS. See supra note 18. As described
below, the Exchange proposes to codify the required information
under proposed Article 17, Rule 7(c).
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    The Exchange also proposes to adopt Article 17, Rule 7 (Broker Back
Office System) to describe the BBOS. Proposed Rule 7(a) provides that
BBOS is a trade management system developed and maintained by the
Exchange that permits IBs to input certain information and to generate
reports therefrom. The rule also states that BBOS is an automated
system approved by the Exchange for the purposes of amended Rule 3(a)
above.
    Proposed Rule 7(b) provides that users of the BBOS are responsible
for entering all transaction, order and other information into the
system as required by CHX Rules. The rule further states that as
operator of BBOS, the Exchange retains information entered into BBOS on
behalf of the user in conformity with applicable rules and regulations.
The rule then provides that the Exchange provides such information to
IBs in a format designated by the Exchange to assist IBs: In conducting
research regarding their own trading activities; in responding to
requests for information from customers, regulatory authorities or by
process of law; and for other legitimate business purposes. The rule
also states that the Exchange charges IBs the fees specified in its
published Schedule of Fees and Assessments for the collection and
retrieval of such information.\38\
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    \38\ The Exchange does not propose to assess a fee for use of
the BBOS in addition to the current fees related to costs incurred
by the Exchange in creating any requested reports, which shall be
rebilled to Participants at cost. See Section K of the Fee Schedule
of CHX.
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    Proposed Rule 7(c) lists the specific information regarding
component orders and trades related to QCT Crosses that IBs are
required to enter into the BBOS. Specifically, proposed Rule 7(c)
provides that for all orders and trades described under amended Article
11, Rule 3(b)(27), IBs must record the following information into the
BBOS, as applicable: (1) QCT Type; (2) Related Exchange; (3) Print
Time; (4) Expiration Year; (5) Expiration Month; (6) Price; (7)
Contracts; (8) Strike Price; (9) Call/Put; (10) Volume; and (11) Short
Sale Indicator.
    In addition, in order to contemplate the proposed IB
responsibilities related to the QCT Crosses, the Exchange proposes to
amend Article 17, Rule 3(a) to broaden its scope so as to provide that
each IB must enter all orders it receives for execution and any other
information as required under Article 11 into an automated system
approved by the Exchange. Correspondingly, the Exchange proposes to
amend the header to Article 17, Rule 3(a) to state ``Entry of orders
and related information into an automated system.'' Given that amended
Article 11, Rule 3(b)(27) may require the recording of information
related to orders that the IB did not actually receive or otherwise
handle, the Exchange believes that broadening the scope of Article 17,
Rule 3(a) is necessary, as it currently only applies to orders received
by the IB.
(6) Clarifying Amendments Related to IB Trading Accounts
    Current Article 17, Rule 3(c) provides that each IB must maintain
separate accounts for handling (1) agency transactions; (2) principal
transactions; and (3) transactions involving errors, and must enter
transactions into the appropriate accounts. The Exchange proposes to
amend the rule to clarify that the required accounts relate to special
recordkeeping accounts that must be maintained at CHX, which is
necessary for the Exchange to adequately surveil and examine the
relevant IB trading activity, as well as to provide additional detail
as to the types of transactions that must be recorded in the respective
accounts. Accordingly, amended Article 17, Rule 3(c) provides that each
IB must establish and maintain separate CHX recordkeeping accounts at
the Exchange for the sole purpose of recording the following activity:
(1) An agency recordkeeping account for agency transactions; (2) a
principal recordkeeping account for principal and riskless principal
\39\ transactions; and (3) an error recordkeeping account for
transactions involving only Bona Fide Errors.\40\ The rule also
provides that an IB must record each above-mentioned transaction into
the appropriate CHX recordkeeping account.
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    \39\ See CHX Article 9, Rule 14.
    \40\ See CHX Article 1, Rule 1(ii).
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(7) Operative Date
    In the event the proposed rule change is approved by the
Commission, the proposed rule change shall be operative pursuant to
notice by the Exchange to Participants.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act in general,\41\ and furthers the
objectives of Section 6(b)(5)

in particular,\42\ in that it is designed to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in facilitating transactions in securities, to remove
impediments and perfect the mechanisms of a free and open market, and,
in general, to protect investors and the public interest; and is not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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    \41\ 15 U.S.C. 78f(b).
    \42\ 15 U.S.C. 78f(b)(5).
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    Specifically, the Exchange believes that permitting only IBs to
submit QCT Crosses to the Matching System would protect investors and
the public interest, as IBs have historically been the only
Participants that have submitted QCT Crosses and, thus, have the
necessary experience in ensuring that QCT Crosses are submitted to the
Matching System in a manner consistent with CHX Rules and the QCT
Exemption. Moreover, given that the Surveillance and Examination
program as applied to QCTs is optimized with respect to the submission
of QCT Crosses by IBs, the Exchange believes that the proposal would
permit the Exchange to more effectively monitor the use of QCT Crosses
by ensuring that all QCT activity on the Exchange is monitored via the
same surveillance and examination protocols, which further the
protection of investors and the public interest.
    The Exchange also believes that permitting only IBs to submit QCT
Crosses to the Matching System would not result in unfair
discrimination among Participants. Initially, the Exchange notes that
any Participant that has satisfied all Exchange requirements to operate
as an IB may register as an IB,\43\ which would, in effect, permit any
Participant that meets Exchange requirements to submit QCT Crosses.
Moreover, even if the proposal discriminates between IB and non-IB
Participants, given the complexity of facilitating QCTs, the Exchange
believes that the heightened recordkeeping requirements for QCTs are
necessary and appropriate to ensure that QCTs are executed in a manner
consistent with CHX Rules and the QCT Exemption. Since the Surveillance
and Examination program as applied to QCTs is optimized with respect to
the submission of QCT Crosses by IBs, the Exchange believes that the
most effective way to surveil for compliance with CHX Rules and the QCT
Exemption is to limit the submission of QCTs to IBs. The Exchange also
believes that the proposal would eliminate the possibility of
regulatory disparities that may result from the transmission of QCT-
related information to the Exchange through different means and ensure
consistent recordkeeping obligations among Participants that submit QCT
Crosses. Thus, the Exchange submits that any discrimination between IB
and non-IB Participants is justified.
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    \43\ See CHX Article 17, Rule 1.
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    In addition, the Exchange believes that the proposed IB
recordkeeping requirements for component orders related to QCT Crosses
executed within the Matching System and the requirement that such
information be entered into the BBOS would protect investors and the
public interest by requiring the entry of more detailed information,
which will enhance the ability of the Exchange to monitor compliance by
the IBs with CHX Rules and the QCT Exemption.
    Also, the Exchange believes that the non-substantive amendments to
the operation of the cross order type and Cross With Size handling
under Article 1, Rule 2(a)(2), Article 1, Rule 2(g)(1) and Article 20,
Rule 8(e); the recordkeeping requirements under Article 11, Rule 3; and
the IB recordkeeping account requirements under Article 17, Rule 3(c),
clarifies the scope and meaning of those rules, which furthers the
objectives of Section 6(b)(1) \44\ in that it further enables the
Exchange to be so organized as to have the capacity to be able to carry
out the purposes of the Act and to comply, and to enforce compliance by
its Participants and persons associated with its Participants, with the
provisions of the Act, the rules and regulations thereunder, and the
rules of the Exchange.
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    \44\ 15 U.S.C. 78f(b)(1).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The proposed rule change
enhances the Exchange's Surveillance and Examination program as applied
to QCTs and otherwise clarifies existing CHX Rules. Thus, the Exchange
does not believe that the proposed rule change raises any competitive
issues.

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 within such longer period 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 Exchange consents, the Commission will: (a) By order approve
or disapprove such 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-CHX-2017-12 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-CHX-2017-12. 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-CHX-2017-12, and should be submitted on or before August 31, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\45\
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    \45\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-16829 Filed 8-9-17; 8:45 am]
 BILLING CODE 8011-01-P