[Federal Register Volume 80, Number 249 (Tuesday, December 29, 2015)]
[Notices]
[Pages 81393-81402]
[FR Doc No: 2015-32654]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76742; File No. SR-Phlx-2015-49]

Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of
Filing of Amendment Nos. 1 and 2 and Order Granting Accelerated
Approval of a Proposed Rule Change, as Modified by Amendment Nos. 1 and
2, To Amend and Correct Phlx Rule 1080.07

December 22, 2015.

I. Introduction

    On June 5, 2015, NASDAQ OMX PHLX LLC (``Exchange'' or ``Phlx'')
filed with the Securities and Exchange Commission (``Commission''),
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to
amend and correct several provisions of Phlx Rule 1080.07, ``Complex
Orders on Phlx XL,'' which governs the handling of Complex Orders
submitted to the Phlx's electronic Complex Order System (``System'').
The proposed rule change was published for comment in the Federal
Register on June 23, 2015.\3\ On July 30, 2015, the Commission extended
the time period for Commission action to September 21, 2015.\4\ On
September 17, 2015, the Commission instituted proceedings to determine
whether to approve or disapprove the proposed rule change.\5\ The Phlx
filed Amendment Nos. 1 and 2 to the proposal on November 4, 2015, and
December 3, 2015, respectively.\6\ On December 15, 2015, the Commission
extended the time period for Commission action to February 18, 2016.\7\
The Commission received no comments regarding the proposed rule change.
The Commission is publishing this notice to solicit comments on
Amendment Nos. 1 and 2 and is approving the proposed rule change, as
amended, on an accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 75189 (June 17,
2015), 80 FR 35997 (``Notice'').
    \4\ See Securities Exchange Act Release No. 75570, 80 FR 46619
(August 5, 2015).
    \5\ See Securities Exchange Act Release No. 75942, 80 FR 57406
(September 23, 2015).
    \6\ As described more fully in Section II(H) below, Amendment
No. 1 revises the proposal to further clarify or add detail to
several rules, provide additional rationale for certain proposed
changes, and specify the time when the Phlx plans to begin accepting
all-or-none Complex Orders. Amendment No. 2 revises several rules to
clarify the manner in which participants may participate in auctions
and in the opening process. When the Phlx filed Amendment Nos. 1 and
2 with the Commission, it also posted the amendments on the Phlx's
Web site and submitted them as a comment letters to the file, which
the Commission posted on its Web site and placed in the public
comment file for SR-Phlx-2015-49.
    \7\ See Securities Exchange Act Release No. 76648, 80 FR 79385
(December 21, 2015).
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II. Description of the Proposal

    The Phlx proposes to amend and correct inconsistencies in several
provisions of Phlx Rule 1080.07, which governs the handling of Complex
Orders submitted to the System. The System currently includes a Complex
Order Opening Process (``COOP''); the Complex Order Live Auction
(``COLA''), an automated auction for seeking liquidity and price
improvement for Complex Orders; and a Complex Limit Order Book
(``CBOOK''). In addition, the proposal revises Phlx Rule 1080.07 to
describe the acceptance and treatment of all-or-none Complex Orders.

A. Amendments to the COOP Rules

    The Phlx proposes several changes to Phlx Rule 1080.07(d) to
accurately describe the operation of the COOP for Complex Order
Strategies and to provide additional details regarding the COOP.\8\
Currently, Phlx Rule 1080.07(d)(ii) provides that upon receipt of a
single COLA-eligible order, the System initiates the opening process.
The Phlx proposes to revise Phlx Rule 1080.07(d)(ii) to indicate that,
instead, the COOP operates in a manner similar to a traditional opening
process for single leg orders, taking into account all trading interest
in a particular Complex Order Strategy (rather than auctioning a single
order), to determine the price at which the maximum number of contracts
may trade, and calculating any imbalance.\9\ The Phlx states that the
opening process maximizes price discovery and seeks to execute as much
interest as possible at the best possible price(s).\10\
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    \8\ A Complex Order Strategy is a particular combination of
components of a Complex Order and their ratios to one another. See
Phlx Rule 1080.07(a)(ii).
    \9\ See Notice, 80 FR at 35997. Phlx states that it currently
operates the COOP as proposed. Id.
    \10\ See Notice, 80 FR at 36004.
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    Phlx Rule 1080.07(d)(ii), as amended, provides that the Phlx will
conduct a COOP for any Complex Order Strategy for which the Phlx has
received an order prior to the opening, unless the Complex Order
Strategy is already open as a result of another electronic auction
process or another electronic auction involving the same Complex Order
Strategy is in progress.\11\ Following a trading halt, the System will
conduct a COOP for any Complex Order Strategy that has a Complex Order
present or that had previously opened prior to the trading halt.\12\
The System will initiate the COOP once trading in each option component
of a Complex Order Strategy has opened (or re-opened following a
trading halt) for a certain configurable time not to exceed 60
seconds.\13\ This

opening delay timer is intended to allow options prices to stabilize
after the options opening before permitting Complex Orders to become
available for trading.\14\ COOPs for different Complex Order Strategies
may occur at the same time.\15\
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    \11\ Phlx Rule 1080.07(d)(ii) currently indicates that the
System will conduct a COOP if a Complex Order is pending at the
opening or re-opening following a trading halt. The Phlx is revising
the rule to indicate that the receipt of an order will trigger a
COOP, regardless of whether the order is still pending. For example,
an order that was no longer pending because the sender has canceled
the order will nonetheless trigger a COOP. See Notice, 80 FR at
35997.
    \12\ See Phlx Rule 1080.07(d)(ii).
    \13\ See id. The proposal deletes provisions in Phlx Rule
1080.07(d)(ii)(A)(2) which states that the System will not engage
the COOP Timer upon re-opening Complex Order trading when either:
(a) the Exchange's automated execution system was disengaged and
subsequently re-engaged, or (b) the Phlx XL Risk Monitor Mechanism
was engaged and subsequently disengaged. These provisions are
incorrect because the Exchange cannot disengage its automatic
execution system and because the operation of the Risk Monitor
Mechanism does not impact the COOP Timer. See Notice, 80 FR at
35998. The proposal also deletes the references to Phlx Rule
1080.07(d)(ii)(A)(2) in Phlx Rules 1080.07(c)(ii) and (d)(ii)(A)(1).
In addition, the proposal deletes the provision in Phlx Rule
1080.07(c)(ii)(D) indicating that Complex Orders will not trade on
Phlx XL when the Phlx's automated execution system is disengaged for
any options component of a Complex Order. See Amendment No. 1.
    \14\ See Notice, 80 FR at 36004.
    \15\ See Notice, 80 FR at 35998.
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    The COOP is comprised of two phases, the COOP Timer and the COOP
Evaluation.\16\ During the COOP Timer, the Phlx will send a broadcast
message indicating that a COOP has been initiated for a Complex Order
Strategy (``Complex Order Opening Auction Notification'').\17\ The
Complex Order Opening Auction Notification, which is intended to
attract interest to the opening process and encourage the opening of a
Complex Order Strategy, will identify the Complex Order Strategy, the
opening price (based on the maximum number of contracts that can be
executed at one particular price, except if there is no price at which
any orders may be executed), and the imbalance side and volume, if
any.\18\ The Complex Order Opening Notification starts the COOP Timer,
during which Phlx XL Participants may submit responses to the Complex
Order Opening Auction Notification.\19\ Complex Orders received prior
to the COOP Timer and Complex Orders received during the COOP Timer
that are not marked as a response to the Complex Order Opening Auction
Notification will be visible to Phlx XL participants upon receipt.\20\
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    \16\ See Phlx Rule 1080.07(d)(ii).
    \17\ See Phlx Rule 1080.07(d)(ii)(A)(1). The Complex Order
Opening Auction Notification is sent over an order feed, Phlx
Orders, which contains Complex Order information, as well as over
the Specialized Quote Feed. See Notice, 80 FR at 35998.
    \18\ See Phlx Rule 1080.07(d)(ii)(A)(1) and Notice, 80 FR at
36004.
    \19\ See Phlx Rule 1080.07(d)(ii)(A)(1).
    \20\ See Phlx Rule 1080.07(d)(ii)(A)(4).
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    New subparagraphs (1), (2), and (3), of Phlx Rule 1080.07(d)(ii)(B)
describe the manner in which market participants may respond to a
Complex Order Opening Auction Notification. Phlx XL participants \21\
may bid and/or offer on either or both side(s) of the market during the
COOP Timer by submitting one or more Complex Orders in $0.01 increments
(a ``Complex Order Response'').\22\ A Complex Order Response that is
marked as a response will not be visible to Phlx XL participants.\23\
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    \21\ Under Phlx Rule 1080.07(a)(vii), as proposed to be amended,
``Phlx XL participant'' ``means SQTs, RSQTs, non-SQT ROTs,
specialist and non-Phlx market makers on another exchange; non-
broker-dealer customers, Firms and non-market maker off-floor
broker-dealers; and Floor Brokers using the Options Floor Broker
Management System.
    \22\ See Phlx Rule 1080.07(d)((ii)(B) and Amendment No. 2.
    \23\ See Phlx Rule 1080.07(d)(ii)(B)(3). In contrast, a Complex
Order submitted during the COOP Timer that is not marked as a
response will be visible to Phlx XL participants upon receipt. See
Phlx Rule 1080.07(d)((ii)(A)(4).
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    In addition to submitting Complex Order Responses, Phlx XL market
makers \24\ may bid and/or offer on either or both side(s) of the
market during the COOP Timer by submitting one or more bids/offers
known as COOP Sweeps.\25\ A Phlx XL market maker may submit multiple
COOP Sweeps at different prices in increments of $0.01 in response to a
Complex Order Opening Auction Notification, regardless of the minimum
trading increment applicable to the specific series.\26\ A Phlx XL
market maker may change the size of a previously submitted COOP Sweep
during the COOP Timer.\27\ Phlx XL market makers are the only
participants that may submit COOP Sweeps.\28\ According to the Phlx,
the Exchange developed COOP Sweeps to allow Phlx XL market makers to be
able to expeditiously submit one-sided responsive interest without
having to enter an order, which involves a different protocol and
method of entry.\29\ The Phlx states that COOP Sweeps were intended to
encourage Phlx XL market makers to submit responsive interest while
managing risk, utilizing a single protocol.\30\ The Phlx notes that the
ability to enter two-sided quotes also is available only to Phlx XL
market makers.\31\ The Phlx represents that there is no advantage to
submitting a COOP Sweep rather than a Complex Order, and that market
participants who are not Phlx XL market makers are not disadvantaged by
their inability to submit COOP Sweeps, much as they are not
disadvantaged by their inability to submit quotes or sweeps for non-
Complex Orders.\32\ In this regard, the Phlx states that Phlx XL
participants who are not market makers may submit Immediate-or-Cancel
(``IOC'') orders, which behave in the same manner as a sweep.\33\
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    \24\ Under Phlx Rule 1080.07(a)(vii), as proposed to be amended,
a Phlx XL market maker is an SQT, RSQT, or a specialist.
    \25\ See Phlx Rule 1080.07(d)(ii)(B). A COOP Sweep is a one-
sided electronic quotation at a particular price submitted for
execution against opening trading interest in a particular Complex
Order Strategy. See id.
    \26\ See Phlx Rule 1080.07(d)(ii)(B)(1).
    \27\ See Phlx Rule 1080.07(d)(ii)(B)(2). The System uses a Phlx
XL market maker's most recently submitted COOP Sweep at each price
level as the market maker's response at that price level, unless the
COOP Sweep has a size of zero. A COOP Sweep with a size of zero will
remove a Phlx XL market maker's COOP Sweep from that COOP at that
price level. See id.
    \28\ See Notice, 80 FR at 35999. Similarly, as discussed more
fully below, Phlx XL market makers are the only participants that
may submit sweeps of non-Complex Orders, COLA Sweeps, and CBOOK
Sweeps. See id. and Amendment No. 1.
    \29\ See id. The Phlx states that Phlx XL market makers use a
particular quoting protocol to submit quotes and sweeps to the Phlx.
See Notice, 80 FR at 36004.
    \30\ See id.
    \31\ See Notice, 80 FR at 36004.
    \32\ See id. In addition, the Phlx notes that some Phlx XL
market makers choose to submit their interest in the form of a
Complex Order. See Notice, 80 FR at 35999.
    \33\ See Notice, 80 FR at 36004.
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    COOP Sweeps and Complex Order Responses will not be visible to any
participant and will not be disseminated by the Exchange.\34\ The Phlx
believes that this information would not be useful due to the
temporary, quick nature of the COOP.\35\ COOP Sweeps and Complex Order
Responses that remain unexecuted at the end of the COOP Timer after all
executions have been completed will expire.\36\ A Complex Order
submitted during the COOP Timer that is not marked as a response will
be available to be traded after the opening of the Complex Order
Strategy unless it is marked IOC.\37\ Such a Complex Order will be
placed on the CBOOK if it is not executed during the opening.\38\
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    \34\ See Phlx Rule 1080.07(d)(ii)(B)(3).
    \35\ See Notice, 80 FR at 36004.
    \36\ See id.
    \37\ See id.
    \38\ See Amendment No. 2.
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    Upon expiration of the COOP Timer, the COOP Evaluation begins.\39\
During the COOP Evaluation, the System determines, for a Complex Order
Strategy, the price at which the maximum number of contracts may trade,
taking into account Complex Orders marked all-or-none (which will be
executed if possible), unless the maximum number of contracts may trade
only without including all-or-none orders.\40\ The Phlx will open the
Complex Order Strategy at that price, executing marketable trading
interest in the following order: first, non-broker-dealer customers in
time priority; next, Phlx XL market makers on a pro rata

basis; and, lastly, all other participants on a pro rata basis.\41\ The
imbalance of Complex Orders that are unexecutable at that price will be
placed on the CBOOK.\42\
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    \39\ See Phlx Rule 1080.07(d)(ii)(C).
    \40\ See id. and Amendment No. 1. See Notice, 80 FR at 35999,
for examples illustrating the handling of all-or-none orders at the
opening. The Phlx notes that an all-or-none Complex Order will be
executed if the price and size of the all-or-none order meets the
criterion of executing the maximum number of contracts possible to
establish the COOP Evaluation price. See Amendment No. 1.
    \41\ See Phlx Rule 1080.07(d)(ii)(C).
    \42\ See id.
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    If the System determines at the end of the COOP Timer that no trade
is possible (i.e., there are no market or marketable limit Complex
Orders or COOP Sweeps, Complex Orders or COOP Sweeps that are equal to
or improve the cPBBO,\43\ and/or Complex Orders or COOP Sweeps that
cross within the cPBBO in the System), all Complex Orders received
during the COOP Timer will be placed on the CBOOK.\44\ If the System
determines that a trade is possible (i.e., there are market or
marketable limit Complex Orders or COOP Sweeps, Complex Orders or COOP
Sweeps that are equal to or improve the cPBBO, and/or Complex Orders or
COOP Sweeps that cross within the cPBBO in the System), Phlx Rule
1080.07(d)(ii)(C)(2) describes the executions that will occur.\45\ The
Phlx notes that the opening price logic maximizes the number of
contracts executed during the opening process and ensures that residual
contracts of partially executed orders or quotes are at a price equal
to or inferior to the opening price.\46\ The logic ensures that there
is no remaining unexecuted interest available at a price that crosses
the opening price.\47\ If multiple prices exist that ensure that there
is no remaining unexecuted interest available through such price(s),
the opening logic chooses the midpoint of such price points.\48\ A
Complex Order Strategy will be open after the COOP even if no
executions occur.\49\ Thus, a Complex Order Strategy will be open based
on the fact that interest was received, regardless of whether the
response interest results in an execution.\50\
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    \43\ The cPBBO is the best net debit or credit price for a
Complex Order Strategy based on the Phlx best bid and/or offer
(``PBBO'') for the individual options components of the Complex
Order Strategy and, where the underlying security is a component of
the Complex Order Strategy, the national best bid and/or offer for
the underlying security. The cPBBO is a calculated number and does
not include orders on the CBOOK or interest on other exchanges. See
Notice, 80 FR at 35999-36000, and Phlx Rule 1080.07(a)(iv).
    \44\ See Phlx Rule 1080.07(d)(ii)(C)(1).
    \45\ If a trade is possible based on interest in the System, the
System will do the following: if such interest crosses and does not
match in size, the execution price is based on the highest (lowest)
executable offer (bid) price when the larger sized interest is
offering (bidding), provided, however, that if there is more than
one price at which the interest may execute, the execution price
when the larger sized interest is offering (bidding) is the midpoint
of the highest (lowest) executable offer (bid) price and the next
available executable offer (bid) price rounded, if necessary, down
(up) to the closest minimum trading increment. If the crossing
interest is equal in size, the execution price is the midpoint of
lowest executable bid price and the highest executable offer price,
rounded, if necessary, up to the closest minimum trading increment.
Executable bids/offers include any interest which could be executed
at the net price without trading through residual interest or the
cPBBO, or without trading at the cPBBO where there is non-broker-
dealer customer interest at the best bid or offer for any leg,
consistent with Rule 1080.07(c)(iii). if there is any remaining
interest after complex interest has traded against other complex
interest, there is no component that consists of the underlying
security, and the order is not marked all-or-none, such interest may
``leg'' whereby each options component may trade at the PBBO with
existing quotes and/or limit orders on the limit order book for the
individual components of the Complex Order; provided that remaining
interest may execute against any eligible Complex Orders received
before legging occurs. If the remaining interest has a component
that consists of the underlying security or is an all-or-none
Complex Order, such Complex Order will be placed on the CBOOK. See
Phlx Rule 1080.07(d)(ii)(C)(2). Examples illustrating the execution
of orders pursuant to Phlx Rule 1080.07(d)(ii)(C)(2) appear in the
Notice, 80 FR at 36000-36001.
    \46\ See Notice, 80 FR at 36000.
    \47\ See id.
    \48\ See id.
    \49\ See Phlx Rule 1080.07(d)(ii)(C)(3).
    \50\ See Notice, 80 FR at 36004.
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    The proposal revises the rules describing the operation of the COLA
to indicate that the System uses the process set forth in Phlx Rule
1080.07(d)(ii)(C)(2) not only to determine executions at the conclusion
of the COOP, but also to determine executions against a COLA-eligible
order at the conclusion of the COLA.\51\ The Phlx believes that the
correction of Phlx Rule 1080.07(e)(viii)(C)(3) and the level of detail
provided in the revised rule will help Phlx participants understand how
their execution price is determined, and that the method is fair and
orderly, based on both size and midpoint, which reflect the totality of
the remaining interest.\52\ In addition, the Phlx believes that this
execution process is consistent with just and equitable principles of
trade because it is based on the price of the larger sized interest,
which affects more options contracts and is likely to result in more
executions than the current rule would provide.\53\ The Phlx further
notes that the provision in Phlx Rules 1080.07(d)(ii)(C)(2) and
1080.07(e)(viii)(C)(3) allowing certain remaining interest to ``leg''
by trading at the PBBO with existing quotes and/or limit orders on the
limit order book may provide any opportunity for additional Complex
Orders to trade.\54\
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    \51\ See Phlx Rule 1080.07(e)(viii)(C)(3) and Notice, 80 FR at
36003.
    \52\ See Notice, 80 FR at 36003.
    \53\ See id. at 36005.
    \54\ See id.
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B. IOC Orders and Do Not Auction (``DNA'') Orders

    The proposal revises the Phlx's rules to describe the handling of
IOC and DNA Orders at the opening. Complex Orders marked as IOC or DNA
that are received before the COOP is initiated will be cancelled and
will not participate in the COOP, although a COOP will occur in that
Complex Order Strategy.\55\ The Phlx believes that it is appropriate
for the COOP to occur even if the IOC or DNA order that triggered the
COOP has been cancelled because the opening process is intended to open
key strategies in which participants are interested.\56\
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    \55\ See Phlx Rule1080.07(d)(ii)(A)(5). In such cases, a Complex
Order Opening Auction Notification is sent with a price and size of
zero, and a buy side. See Notice, 80 FR at 35998. The Phlx notes
that non-Complex Orders marked IOC that are received prior to the
opening of the option also are cancelled upon receipt. See Notice,
80 FR at 36004.
    \56\ See Notice, 80 FR at 35998.
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    IOC Complex Orders received during a COOP will join the COOP and
will be treated like any other Complex Order, except that they will be
cancelled at the end of the COOP Timer if they are not executed.\57\
DNA Complex Orders received during a COOP will be cancelled and will
not participate in the COOP because allowing them to join the COOP
would involve a delay.\58\
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    \57\ See Notice, 80 FR at 35998. The Phlx notes that this is
intended to try to execute the order, because the order may be
responding to the Complex Order Opening Auction Notification. See
id.
    \58\ See Phlx Rule 1080.07(d)(ii)(A)(5) and Notice, 80 FR at
35998.
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    The proposal also revises Phlx Rule 1080.07(b)(iii) to state that
Floor Brokers using the Options Floor Broker Management System may
enter Complex Orders as IOC only on behalf of ``SQTs, RSQTs, non-SQT
ROTs, specialists, non-Phlx market makers on another exchange, and
Firms,'' rather than on behalf of ``broker-dealers or affiliates of
broker-dealers.'' The Phlx states that this revision merely replaces
vague terms (broker-dealers or affiliates of broker-dealers) with more
precise terms that are linked to definitions in the rule.\59\
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    \59\ See id. at 36005.
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C. Amendments to the COLA Rules

    The proposal makes several changes to the rules governing the
operation of the COLA. First, the proposal amends and corrects Phlx
Rule 1080.07(e)(iv) to add a definition of COLA Sweep and to indicate
that only Phlx XL market makers, rather than Phlx XL participants, may
submit COLA

Sweeps.\60\ Any COLA Sweeps that remain unexecuted at the end of the
COLA Timer once all executions are complete will expire.\61\ Phlx XL
participants may bid and/or offer on either or both side(s) of the
market during the COLA timer by submitting one or more Complex Orders
in $0.01 increments.\62\ A Complex Order marked as a response will not
be visible to any participant and will not be disseminated by the
Phlx.\63\ A Complex Order marked as a response will expire if it is
unexecuted at the end of the COLA Timer.\64\ A Complex Order not marked
as a response that is not executed during the COLA will be available to
be placed on the CBOOK, unless the order is marked IOC.\65\
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    \60\ A COLA Sweep in is a one-sided electronic quotation
submitted for execution against other trading interest in a
particular Complex Order Strategy. See Phlx Rule 1080.07(e)(iv).
    \61\ See id.
    \62\ See Amendment No. 2.
    \63\ See id.
    \64\ See id.
    \65\ See id.
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    Second, the proposal revises the specialist allocation provisions
in Phlx Rule 1080.07(e)(vi)(C). Phlx Rule 1080.07(e)(vi)(C) currently
provides that, after customer marketable Complex Orders have been
executed against a COLA-eligible order, a specialist that submits a
COLA Sweep for the same price as other COLA Sweeps that are eligible
for execution against the COLA-eligible order will be entitled to
receive the greater of: (1) The proportion of the aggregate size at the
cPBBO associated with such specialist's COLA Sweep, SQT and RSQT COLA
Sweeps, and non-SQT ROT Complex Orders on the CBOOK; (2) the Enhanced
Specialist Participation as described in Phlx Rule 1014(g)(ii) (which
provides a specialist with an enhanced participation of 30% of the
remainder of an order under certain circumstances); or (3) 40% of the
remainder of the order. The proposal eliminates Phlx Rule
1080.07(e)(vi)(C)(3), which would provide the specialist with 40% of
the remainder of a COLA-eligible order.\66\ The Phlx states that this
provision, which does not currently operate, may have been an error
because, given the ``greater of'' language in the rule, the 30%
Enhanced Specialist Participation contemplated under Phlx Rule
1080.07(e)(vi)(C)(2) would never have operated.\67\ The proposal also
corrects Phlx Rule 1080.07(e)(vi)(C)(1) by deleting language that
limits the specialist's entitlement to the proportion of the aggregate
size ``at the cPBBO'' associated with the specialist's COLA Sweep, SQT
and RSQT Sweeps, and non-SQT ROT Complex Orders on the CBOOK. The Phlx
states that the System instead looks at all of a specialist's COLA
Sweeps at a particular price, not just at the cPBBO, and compares them
to all other Phlx XL market maker interest at that price.\68\ The
revised rule will take into account all expressed interest at each
price, instead of interest only at the cPBBO, which should maximize the
number of contracts executed.\69\ Thus, under Phlx Rule
1080.07(e)(vi)(C), as amended, a specialist would be entitled to
receive the greater of: (1) The proportion of the aggregate size
associated with the specialist's COOA Sweep, SQT and RSQT COLA Sweeps,
and non-SQT ROT Complex Orders on the CBOOK; or the 60/40/30% Enhanced
Specialist Participation described in Rule 1014(g)(ii). The Phlx notes
that this is the same enhanced pro-rata specialist allocation that
applies to non-Complex Orders.\70\
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    \66\ See Notice, 80 FR at 36001.
    \67\ See Notice, 80 FR at 36001.
    \68\ See id.
    \69\ See Notice, 80 FR at 36005.
    \70\ See Notice, 80 FR at 36001.
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    Third, the proposal revises Phlx Rule 1080.07(e)(vii) to indicate
that COLA Sweeps that exceed the size of a COLA-eligible order are
eligible to trade with other incoming COLA-eligible orders, COLA
Sweeps, and any other interest received during the COLA Timer after the
initial COLA-eligible order has been executed ``to the fullest extent
possible,'' rather than ``in its entirety.'' \71\ The Phlx notes that a
COLA-eligible order need not be executed in its entirety for other
interest to be executed.\72\ The Phlx states that permitting executions
of responsive interest at a different price, after the COLA-eligible
order has been executed to the fullest extent possible, benefits the
responsive interest.\73\ The Phlx further notes that fewer contracts
would have been executed if the System operated as described in the
current rule text, because fewer contracts would have been available
for execution against the COLA-eligible order and other responsive
interest.\74\
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    \71\ The Phlx also proposes to make this change in Phlx Rules
1080.07(e)(vii), (e)(viii)(B), (e)(viii)(C)(1), (e)(viii)(C)(1)(e),
(e)(viii)(C)(2), (e)(viii)(C)(2)(e) and (e)(viii)(C)(3). See Notice,
80 FR at 36001.
    \72\ See Notice, 80 FR at 36002. For example, where a COLA-
eligible order is bidding $2.00 for 20 contracts, and other interest
consists of a $2.10 bid for 10 contracts, a $2.10 offer for 10
contracts, and a $2.00 offer for 10 contracts, the buy and sell
orders at $2.10 can execute against each other even though the COLA-
eligible order was not fully executed. See id.
    \73\ See Notice, 80 FR at 36002.
    \74\ See Notice, 80 FR at 36002.
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    Fourth, the proposal deletes from Phlx Rule 1080.07(e)(vi)(B) a
provision stating that, for allocation purposes, the size of a COLA
Sweep or responsive Complex Order received during the COLA Timer will
be limited to the size of the COLA-eligible order.\75\ The Phlx accepts
size in excess of the COLA-eligible order size, which can be executed
against remaining interest after the COLA-eligible order has been
executed to the fullest extent possible.\76\ This change will reflect
the Phlx's current practice and permit the full size of responding
interest to trade against non-COLA-eligible interest.\77\ The Phlx
believes that permitting the trading of interest in excess of the COLA-
eligible volume benefits market participants because it helps to ensure
that as many contracts as possible are executed.\78\
---------------------------------------------------------------------------

    \75\ The proposal also revises Phlx Rule 1080.07(e)(vi)(B) to
refer to ``Complex Orders and COLA Sweeps,'' that are eligible for
execution against the COLA-eligible order at the same price, rather
than Complex Orders, COLA Sweeps, Phlx XL participant Complex
Orders, and/or non-customer off-floor broker-dealer Complex Orders
that are eligible for execution against the COLA-eligible order at
the same price.
    \76\ The remaining interest consists of any potential interest
that has been received, including orders, quotes, COLA Sweeps, and
individual leg market interest. See Notice, 80 FR at 36001.
    \77\ See Notice, 80 FR at 36002.
    \78\ See id.
---------------------------------------------------------------------------

D. Amendments Concerning Firms and Non-Market Maker Off-Floor Broker-
Dealers

    The proposal adds a new defined term, ``Firm,'' that will
distinguish Firms from other non-market maker off-floor broker-
dealers.\79\ The proposal amends Phlx Rule 1080.07(e)(i)(B)(1) to
indicate that orders from Firms are not COLA-eligible and therefore
will not trigger a COLA.\80\ In contrast, orders from non-market maker
off-floor broker-dealers that are not Firms will be eligible to start a
COLA.\81\ The proposal amends Phlx Rule 1080.07(e)(viii)(C)(2) to
indicate that orders from Firms (like orders from Phlx and non-Phlx
market makers) will be treated as non-customer orders for purposes of
determining the execution price that their orders receive when
executing against COLA-eligible

orders.\82\ In addition, the proposal amends Phlx Rule
1080.07(e)(viii)(C)(2)(d) to indicate that the System executes non-
customer (i.e., Phlx market maker, Firm, and non-Phlx market maker)
Complex Orders not in the order in which they were received, as the
rule currently indicates, but on a pro-rata basis among Phlx market
maker interest and then, again on a pro-rata basis, among Phlx XL
participants at each price level, as described in Phlx Rule
1080.07(vi)(B).\83\
---------------------------------------------------------------------------

    \79\ Phlx Rule 1080.07(a)(x) defines ``Firm'' to mean ``a
broker-dealer trading for its own (proprietary) account that is: a
member of The Options Clearing Corporation (``OCC'') or maintains a
Joint Back Office (``JBO'') arrangement with an OCC member. Unless
otherwise specified, Firms are included in the category of non-
market-maker off-floor broker-dealer.''
    \80\ The proposal also deletes from Phlx 1080.07(e)(i)(B)(1) the
requirement that a COLA-eligible Complex Order improve the cPBBO for
the specific Complex Order Strategy, because this requirement is
already stated in Phlx Rule 1080.07(e)(i)(A).
    \81\ See Notice, 80 FR at 36003.
    \82\ See Amendment No. 1. Phlx Rule 1080.07(e)(viii)(C)(2) (2),
as amended, provides, in relevant part, that: Incoming non-customer
(Phlx market makers, Firms and non-Phlx market makers) Complex
Orders that are received during the COLA Timer on the opposite side
of the market from the COLA-eligible order with a price equal to or
better than the best priced Complex Order or COLA Sweep will be
executed against the COLA eligible order (which will be executed in
its entirety first as described in subparagraph (B) above) or other
Complex Orders or COLA Sweeps as follows:
     (a) If such incoming non-customer Complex Order is a limit
order at the same price as the best priced Complex Order or COLA
Sweep, the incoming non-customer Complex Order will be executed at
such price, subject to the provisions set forth sub-paragraph (e)
above.
     (b) If such incoming non-customer Complex Order is a limit
order that improved the best priced Complex Order or COLA Sweep, the
incoming non-customer Complex Order will be executed at the limit
order price.
     (c) If such incoming non-customer Complex Order is a market
order or a limit order that crosses the cPBBO, the incoming non-
customer Complex Order will be executed at a price of $0.01 better
than the cPBBO on the same side of the market as the COLA-eligible
order.
    \83\ See Notice, 80 FR at 36002.
---------------------------------------------------------------------------

    According to the Phlx, the trading style and needs of Firms are
more like market makers.\84\ The Phlx notes that Firms are large, well-
capitalized broker-dealers that trade for their own account and
generally submit large orders, including orders that facilitate their
clients' orders or offset large positions taken to accommodate their
customers.\85\ Thus, the Phlx states that Firms, in general, are
commonly viewed as providers of liquidity, much like market makers.\86\
In addition, the Phlx believes that Firms do not expect or need their
Complex Orders to trigger a COLA, because this is a feature more
commonly associated with customers than with liquidity providers.\87\
The Phlx also states that if Firms' orders were able to start a COLA,
this could impede the ability of other Complex Orders to begin a
COLA.\88\ Finally, the Phlx states that it could impede the submission
of competitive responses and/or quoting if market makers are hesitant
to provide an aggressive price for a COLA that may have been initiated
by a Firm.\89\
---------------------------------------------------------------------------

    \84\ See id.
    \85\ See id. at 36003-36004.
    \86\ See id. at 36004.
    \87\ See id. at 36005.
    \88\ See Amendment No. 1.
    \89\ See id.
---------------------------------------------------------------------------

    Third, the proposal amends Phlx Rule 1080.07(e)(viii)(C)(1) to
indicate that orders from non-market maker off-floor broker-dealers
that are not Firms will be treated like non-broker-dealer customer
orders for purposes of determining the execution price their orders
will receive when executing against a COLA-eligible order.\90\ For
purposes of this rule, the Phlx treats orders from both non-broker-
dealer customers and non-market maker off-floor broker-dealers (other
than Firms) as customer orders because non-market maker off-floor
broker-dealers seek liquidity and are therefore more like customers
than other participants, which generally provide liquidity.\91\ In
addition, the proposal amends Phlx Rule 1080.07(e)(viii)(C)(1)(d) to
specify that, rather than executing all customer Complex Orders in the
order in which they were received, as the rule currently provides, non-
broker-dealer customer orders at the same price are executed in time
priority, while non-market-maker off-floor broker-dealer orders at the
same price are executed on a pro-rata basis. The Phlx states that the
pro rata allocation for non-market maker off-floor broker-dealers is
consistent with the priority rules applicable in other aspects of the
execution of Complex Orders and simple orders.\92\
---------------------------------------------------------------------------

    \90\ Phlx Rule 1080.07(e)(viii)(C)(1), as amended, defines
incoming customer Complex Orders to mean orders from non-broker-
dealer customers and non-market-maker off-floor broker-dealers,
other than Firms. See Amendment No. 1. Phlx Rule
1080.07(e)(viii)(C)(1), as amended, provides, in relevant part, that
(1) Incoming customer (non-broker-dealer customer and non-market
maker off-floor broker-dealer (other than Firms)) Complex Orders
that are received during the COLA Timer on the opposite side of the
market from the COLA-eligible order with a price equal to or better
than the best priced Complex Order or COLA Sweep will be executed
against the COLA eligible order (which will be executed to the
fullest extent possible first as described in sub-paragraph (B)
above) or other Complex Orders or COLA Sweeps as follows:
     (a) If such incoming customer Complex Order is a limit order at
the same price as the best priced Complex Order or COLA Sweep, the
incoming Complex Order will be executed at such price.
     (b) If such incoming Complex Order is a limit order that
improved the best priced Complex Order or COLA Sweep, the incoming
customer Complex Order will be executed at the mid-point of the best
priced Complex Order or COLA Sweep and the limit order price,
rounded, if necessary, to the closest minimum trading increment to
the benefit of the COLA-eligible order.
     (c) If such incoming customer Complex Order is a market order
or a limit order that crosses the cPBBO, the incoming Complex Order
will be executed at the mid-point of the cPBBO on the same side of
the market as the COLA-eligible order and the best priced Complex
Order or COLA Sweep, rounded, if necessary, to the closest minimum
trading increment to the benefit of the COLA-eligible order.
    \91\ See Notice, 80 FR at 36002. See also Amendment No. 1
(clarifying that the non-market maker off-floor broker-dealers
referenced in this rule do not include Firms).
    \92\ See Notice, 80 FR at 36002, and Phlx Rules
1080.07(e)(vi)(B) and 1014(g)(vii).
---------------------------------------------------------------------------

E. Amendment to the CBOOK Rules

    Phlx Rule 1080.07(f)(i)(F) currently provides that a Complex Order
received during the final 10 seconds of the trading session is placed
on the CBOOK.\93\ The proposal amends this provision to indicate that
the System will place a Complex Order on the CBOOK if the Complex Order
is received during the final configurable number of seconds of the
trading session after any marketable portion of the Complex Order is
executed. The Phlx believes that 10 seconds may be too long and could
prevent executions from occurring, and that a COLA may be triggered and
completed in less than three seconds.\94\ Thus, the Phlx believes that
a time period of less than 10 seconds would be appropriate to maximize
executions.\95\ The Phlx will notify participants on its Web site in
advance of a change to the number of seconds.\96\ The proposal also
revises this rule to indicate that a Complex Order will be placed on
the CBOOK after the execution of any marketable portion of the Complex
Order because the System seeks to execute any portion of any order that
can be traded before placing the remainder of the order on the
CBOOK.\97\
---------------------------------------------------------------------------

    \93\ The Phlx notes that the System recently operated such that
a Complex Order received during the final three seconds of the
trading session, rather than the final 10 seconds of the trading
session, was placed on the CBOOK. Accordingly, the Phlx states that
more Complex Orders may have started a COLA than the rule provides
for and may have been executed, rather than resting on the CBOOK.
See Notice, 80 FR at 36002.
    \94\ See id.
    \95\ See id.
    \96\ See id.
    \97\ See id. at 36002-36003.
---------------------------------------------------------------------------

    In addition, the proposal revises Phlx Rule 1080.07(f)(ii) to
indicate that Phlx XL market makers may submit one or more CBOOK Sweeps
to execute against Complex Order interest on the CBOOK.\98\ A CBOOK
Sweep, which is similar to a COOP Sweep or a COLA Sweep, will expire if
it is not executed immediately.\99\ The Phlx notes that a non-Phlx XL
market maker participant that wanted to submit interest that would
expire if it is not executed

immediately would be able to submit an IOC order.\100\
---------------------------------------------------------------------------

    \98\ See Amendment No.1. A CBOOK Sweep is a one-sided electronic
quotation at a particular price submitted for execution against
existing interest in a particular Complex Order Strategy on the
CBOOK. See id.
    \99\ See id.
    \100\ See id.
---------------------------------------------------------------------------

F. All-or-None Orders

    In the current proposal, the Phlx proposes to accept all-or-none
Complex Orders and specify how they are handled.\101\ In particular,
the proposal revises Phlx Rule 1080.07(d)(ii)(C) to indicate that,
during a COOP Evaluation, the System will determine the price at which
the maximum number of contracts may trade, taking into account Complex
Orders marked all-or-none (which will be executed if possible), unless
the maximum number of contracts can only trade without including all-
or-none orders.\102\ In addition, the proposal amends Phlx Rule
1080.07(e)(vi)(A)(1) to indicate that an all-or-none Complex Order will
not leg (i.e., execute against quotes or orders for the individual
components comprising the Complex Order) during a COLA, and that an
all-or-none Complex Order that is not executed during the COLA will be
placed on the CBOOK.\103\ Similarly, the proposal amends Phlx Rule
1080.07(f)(iii)(A) to provide that an all-or-none Complex Order on the
CBOOK will not execute against quotes or orders on the limit order book
for the individual components of the Complex Order.
---------------------------------------------------------------------------

    \101\ See Notice, 80 FR at 35999 and 36004. The Phlx previously
noted that it stopped accepting all-or-none orders on March 17,
2014, to align the System with its rules. See Notice, 80 FR at
36004. The Phlx then adopted a definition of all-or-none orders in
June 2014. See Securities Exchange Act Release No. 72351 (June 9,
2014), 79 FR 33977 (June 13, 2014) (notice of filing and immediate
effectiveness of File No. SR-Phlx-2014-39). Phlx Rule 1080.07
provides that an all-or-none order is an order that is ``to be
executed in its entirety or not at all. These orders can only be
submitted for non-broker-dealer customers.'' The Phlx proposes to
begin accepting all-or-none Complex Orders within 60 days after
approval of the proposal. See Amendment No. 1.
    \102\ See Amendment No. 1. See Section II(A), supra, for a
discussion of the treatment of all-or-none orders in the COOP.
    \103\ See id.
---------------------------------------------------------------------------

    The Phlx notes that all-or-none orders are commonly available for
non-Complex Orders, and that this order type would allow market
participants to obtain a certain minimum size.\104\ The Phlx believes
that this contingency is particularly appropriate for Complex Orders
because of the complexity of the strategies employed by users; the size
of the order could be relevant to the strategy.\105\ The Phlx further
believes that not legging all-or-none Complex Orders promotes just and
equitable principles of trade because the all-or-none contingency
complicates the expeditious execution of such orders against the
individual components of the Complex Order.\106\ The Phlx does not
believe that market participants would expect Complex Orders to leg
because all-or-none orders are often treated differently because of the
nature of the contingency.\107\
---------------------------------------------------------------------------

    \104\ See id.
    \105\ See id.
    \106\ See Notice, 80 FR at 36005.
    \107\ See id.
---------------------------------------------------------------------------

G. Amendments to the Spread Priority Rule

    The proposal revises the Phlx Rule 1080.07(c)(iii) to make clear
that a Complex Order has priority over established bids or offers in
the marketplace for the individual legs that comprise the Complex Order
unless the established bid or offer for at least one leg of the Complex
Order is a non-broker-dealer customer order.\108\ If the established
bid or offer for at least one leg of the Complex Order is a non-broker-
dealer customer order, then at least one leg of the Complex Order must
be executed at a better price than the established bid or offer for
that contract by the minimum trading increment.\109\ Thus, a Complex
Order may not be executed at the cPBBO if there is non-broker-dealer
customer interest at the cPBBO.\110\ For example, with respect to a
Complex Order with four legs, if the established best bid or offer in
the individual leg market for one component of the Complex Order is a
non-broker-dealer customer order, and the best bids or offers in the
individual leg market for the remaining three component legs of the
Complex Order are market maker quotes, the Complex Order would be
required to trade at a price that is better than the cPBBO.\111\ The
Phlx believes that the changes to Phlx Rule 1080.07(c)(iii) clarify the
rule and preserve customer priority.\112\ The Phlx notes that the
ability to achieve spread priority over non-customers is common among
the options exchanges.\113\
---------------------------------------------------------------------------

    \108\ See Amendment No. 1. Phlx Rule 1080.07(c)(iii), as
amended, provides: (A) Complex Orders consisting of a conforming
ratio may be executed at a total credit or debit price without
giving priority to individual bids or offers established in the
marketplace that are not better than the bids or offers comprising
such total credit or debit, provided that if any of the bids or
offers established in the marketplace consist of a non-broker-dealer
customer order, at least one option leg is executed at a better
price than the established bid or offer for that option contract by
the minimum trading increment and no option leg is executed at a
price outside of the established bid or offer for that option
contract.
     (B) Where a Complex Order in a conforming ratio consists of the
underlying security (stock or ETF) and one options leg has priority
over bids or offers established in the marketplace, except over bids
or offers established by non-broker-dealer customer orders. However,
where a Complex Order in a conforming ratio consists of the
underlying stock or ETF and more than one options leg, the options
legs have priority over bids and offers established in the
marketplace, including non-broker-dealer customer orders, if at
least one options leg improves the existing market for that option.
    \109\ See Phlx Rule 1080.07(c)(iii).
    \110\ See Amendment No. 1. See also Phlx Rule
1080.07(d)(ii)(C)(2) (stating that executable bids/offers at the
conclusion of the COOP include any interest that could be executed
at the net price without trading through residual interest or the
cPBBO or without trading at the cPBBO where there is non-broker-
dealer customer interest at the best bid or offer for any leg,
consistent with Phlx Rule 1080.07(c)(iii)).
    \111\ See id.
    \112\ See id.
    \113\ See id.
---------------------------------------------------------------------------

H. Amendment Nos. 1 and 2

    In Amendment No.1, the Phlx proposes to further clarify or add
detail to several rules, provide additional rationale for certain
proposed changes, and specify the time when the Phlx plans to begin
accepting all-or-none Complex Orders. Specifically, Amendment No. 1
revises Phlx Rule 1080.07(d)(ii)(C) to indicate that all-or-none
Complex Orders received during the COOP will be executed if possible,
i.e., when the price and size of the all-or-none order meets the
criterion of executing the maximum number of contracts possible to
establish a COOP Evaluation price. Amendment No. 1 revises Phlx Rule
1080.07(e)(vi)(A)(1) to indicate that an all-or-none order that is not
executed during a COLA will be placed on the CBOOK. In addition,
Amendment No. 1 indicates that the Phlx proposes to begin accepting
all-or-none Complex Orders within 60 days after approval of the
proposal.
    Amendment No. 1 revises Phlx Rule 1080.07(e)(viii)(C)(1) to clarify
that, for purposes of that rule, the term ``incoming customer orders''
refers to orders from non-broker-dealer customers and non-market maker
off-floor broker-dealers other than Firms. The Phlx notes that it is
necessary to exclude from this definition Firms, which otherwise would
fall within the definition of non-market maker off-floor broker-
dealers. Amendment No. 1 also provides additional analysis to support
the statutory basis for this proposed change, stating that it is
consistent with just and equitable principles of trade to treat both
non-broker-dealer customers and non-market-maker, non-Firm off-floor
broker-dealers as ``customers'' for purposes of determining the
execution price of their orders when executing against a COLA-eligible
order because both non-broker-dealer customers and non-market maker,
non-Firm off-floor broker-dealers seek liquidity in the marketplace.

    Amendment No. 1 revises Phlx Rule 1080.07(e)(viii)(C)(2) to specify
that ``non-customer orders'' for purposes of that rule, refers to
orders from Phlx market makers, Firms, and non-Phlx market makers.
    Amendment No. 1 revises the text of Phlx Rule 1080.07(c)(iii), the
Phlx's spread priority rule, to make clear that a Complex Order has
priority over established bids or offers in the marketplace for the
individual legs of the order unless the established bid or offer for at
least one leg is a non-broker-dealer customer order. In addition,
Amendment No. 1 explains that if the established bid or offer for at
least one leg of the order is a non-broker-dealer customer order, then
at least one leg of the Complex Order must be executed at a better
price than the established bid or offer for that leg. Thus, a Complex
Order cannot be executed at the cPBBO if there is non-broker-dealer
customer interest at the cPBBO. For example, with respect to a Complex
Order with four legs, if the established best bid or offer in the
individual leg market for one component of the Complex Order is a non-
broker-dealer customer order, and the best bids or offers in the
individual leg market for the remaining three component legs of the
Complex Order are market maker quotes, the Complex Order would be
required to trade at a price that is better than the cPBBO.\114\
Amendment No. 1 notes that the ability to achieve spread priority over
non-customers is common among the options exchanges.
---------------------------------------------------------------------------

    \114\ Amendment No. 1 makes a related technical correction to
Phlx Rule 1080.07(d)(ii)(C)(2) to indicate that executable bids/
offers during the COOP include any interest that could be executed
``at the net price'' without trading through residual interest or
the cPBBO or without trading at the cPBBO where there is broker-
dealer customer interest at the best bid or offer for any leg,
consistent with Phlx Rule 1080.07(c)(iii).
---------------------------------------------------------------------------

    Amendment No. 1 deletes the provision in Phlx Rule
1080.07(c)(ii)(D) indicating that Complex Orders will not trade on Phlx
XL when the Phlx's automated execution system is disengaged for any
options component of a Complex Order. As noted above and in Amendment
No. 1, the Phlx cannot disengage its automatic execution system.\115\
---------------------------------------------------------------------------

    \115\ See note 13, supra.
---------------------------------------------------------------------------

    Amendment No. 1 revises Phlx Rule 1080.07(f)(ii) to provide for the
submission of CBOOK Sweeps. Specifically, Amendment No. 1 revises the
rule to indicate that Phlx XL market makers may submit one or more
CBOOK Sweeps to execute against Complex Order interest on the CBOOK. A
CBOOK Sweep, which is similar to a COOP Sweep or a COLA Sweep, will
expire if it is not executed immediately. The Phlx notes that a non-
Phlx XL market maker participant that wanted to submit interest that
would expire if it is not executed immediately would be able to submit
an IOC order.
    Finally, Amendment No. 1 provides additional rationale for the
proposal to prevent Firm orders from triggering a COLA. Specifically,
Amendment No. 1 states that the Phlx believes that if Firm orders were
able to start a COLA, this could impede the ability of other Complex
Orders to start a COLA. In addition, the Phlx believes that it could
impede the submission of competitive responses and/or quoting if market
makers are hesitant to provide an aggressive price for COLAs that may
have been initiated by Firms.
    The Phlx believes that it would be consistent with the Act to
approve Amendment No. 1 on an accelerated basis because the changes
proposed in Amendment No. 1 provide additional details or
clarifications to the proposal, without adding new requirements, or
provide additional rationale or analysis to support the proposed
changes. As noted above, Amendment No. 1 also specifies that the Phlx
proposes to begin accepting all-or-none Complex Orders within 60 days
after approval of the proposal.
    Amendment No. 2 revises Phlx Rule 1080.07(e)(iv) to indicate that
Phlx XL participants may bid and or offer on either or both side(s) of
the market during a COLA Timer by submitting one or more Complex Orders
in $0.01 increments. Amendment No. 2 further provides that a Complex
Order marked as a response will expire if it is unexecuted at the end
of the COLA Timer. A Complex Order not marked as a response will be
placed on the CBOOK if it is not executed during the COLA, unless the
order is marked IOC. Amendment No. 2 indicates that Complex Orders
marked as a response will not be visible to any participant and will
not be disseminated by the Phlx. The Phlx believes that these changes
should be approved on an accelerated basis because they provide
additional detail to the rule and clarify the responsive process for a
COLA. The Phlx also notes that these COLA provisions parallel the
provisions in Phlx Rule 1080.07(d)(ii)(B) related to the COOP.
    In addition, Amendment No. 2 revises Phlx Rule 1080.07(d)(ii)(B) to
indicate that Phlx XL participants may respond to a Complex Order
Opening Auction Notification by submitting Complex Orders in increments
of $0.01. Amendment No. 2 also indicates that a Complex Order that is
not marked as a response to a Complex Order Opening Auction
Notification will be placed on the CBOOK if it is not executed during
the opening. The Phlx believes that these changes should be approved on
an accelerated basis because they provide additional detail to the
rule.

III. Discussion and Commission Findings

    The Commission finds that the proposed rule change, as modified by
Amendment Nos. 1 and 2, is consistent with the requirements of the Act
and the rules and regulations thereunder applicable to a national
securities exchange.\116\ In particular, the Commission finds that the
proposed rule change, as amended, is consistent with Section 6(b)(5) of
the Act,\117\ which requires, among other things, that the rules of a
national securities exchange be designed to prevent fraudulent and
manipulative acts and practices, to 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.
---------------------------------------------------------------------------

    \116\ In approving the proposed rule change, as amended, the
Commission has considered the proposed rule's impact on efficiency,
competition, and capital formation. See 15 U.S.C. 78c(f).
    \117\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Commission believes that the COOP rules, as amended, are
designed to facilitate an orderly opening for Complex Orders, or an
orderly re-opening following a trading halt. The Phlx states that the
COOP, which operates in a manner similar to an opening process for
single leg orders, is designed to facilitate price discovery and to
execute as much trading interest as possible at the best possible
price(s).\118\ As described more fully above, the Phlx will conduct a
COOP for any Complex Order Strategy for which the Phlx received a
Complex Order prior to the opening, unless that Complex Order Strategy
is already open.\119\ Upon the initiation of a COOP for a Complex Order
Strategy, the Phlx will send a broadcast message, the Complex Order
Opening Auction Notification, that is intended to attract interest to
the opening process.\120\ The Commission notes that all Phlx XL
participants may participate in a COOP by submitting one or more
Complex Orders on either or

both side(s) of the market in $0.01 increments in response to a Complex
Order Opening Auction Notification.\121\ The Commission believes that
the ability of all Phlx XL participants to participate in a COOP
potentially could lead to more competitive opening auctions, to the
benefit of investors.
---------------------------------------------------------------------------

    \118\ See Notice, 80 FR at 36004.
    \119\ See Phlx Rule 1080.07(d)(ii). Following a trading halt,
the Phlx will conduct a COOP for any Complex Order Strategy that has
a Complex Order present or that had previously opened prior to the
trading halt. See id.
    \120\ See Notice, 80 FR at 36004, and Phlx Rule
1080.07(d)(ii)(A)(1).
    \121\ See Phlx Rule 1080.07(d)(ii)(B) and Amendment No. 2.
---------------------------------------------------------------------------

    At the conclusion of the COOP Timer, the System conducts a COOP
Evaluation to determine the maximum number of contracts that can trade,
taking into account Complex Orders marked all-or-none (which will be
executed if possible), unless the maximum number of contracts can only
trade without including all-or-none orders.\122\ The Phlx will open the
Complex Order Strategy at that price, executing marketable trading
interest in the following order: first, to non-broker-dealer customers
in time priority; next, to Phlx XL market makers on a pro rata basis;
and then to all other participants on a pro-rata basis.\123\ The
Commission notes that this allocation methodology is consistent with
existing Phlx rules.\124\
---------------------------------------------------------------------------

    \122\ See Phlx Rule 1080.07(d)(ii)(C) and Amendment No. 1.
    \123\ See Phlx Rule 1080.07(d)(ii)(C).
    \124\ See, e.g., Phlx Rule 1080.07(vi)(B).
---------------------------------------------------------------------------

    The Phlx states that the opening price logic in Phlx Rule
1080.07(d)(ii)(C), as amended, which determines the execution price of
crossing interest in the COOP, maximizes the number of contracts
executed during the opening process and ensures that residual contracts
of partially executed orders or quotes are at a price equal to or
inferior to the opening price.\125\ Thus, the logic ensures that there
is no remaining unexecuted interest available at a price that crosses
the opening price.\126\ The proposal also applies this execution
process to the COLA.\127\ The Commission believes that these execution
processes should benefit investors by helping to assure the execution
of as many contracts as possible during the COOP and the COLA.
---------------------------------------------------------------------------

    \125\ See Notice, 80 FR at 36000.
    \126\ See id. If multiple prices exist that ensure that there is
no remaining unexecuted interest available through such price(s),
the opening logic chooses the midpoint of such price points. See id.
    \127\ See Phlx Rule 1080.07(e)(viii)(C)(3).
---------------------------------------------------------------------------

    In addition to submitting Complex Orders to respond to a Complex
Order Opening Auction Notification, Phlx XL market makers may respond
by submitting one or more COOP Sweeps.\128\ Only Phlx XL market makers
may submit COOP Sweeps.\129\ Similarly, only Phlx XL market makers may
submit COLA Sweeps and CBOOK Sweeps to trade with, respectively, a
COLA-eligible order or interest resting on the CBOOK.\130\ The Phlx
represents that Phlx XL participants that are not Phlx XL market makers
are not disadvantaged by their inability to submit Sweeps, just as they
are not disadvantaged by their inability to submit quotes or Sweeps for
non-Complex Orders.\131\ The Phlx notes that Phlx XL participants that
are not Phlx XL market makers may submit IOC orders, which behave in
the same manner as a Sweep.\132\ The Phlx states that the Exchange
developed Sweeps to enable Phlx XL market makers to expeditiously
submit one-sided responsive interest without having to enter an order,
which involves a different protocol and method of entry than that used
for submitting quotes and Sweeps; according to the Phlx, Sweeps were
intended to encourage Phlx XL market makers to submit responsive
interest while managing risk, utilizing a single protocol.\133\ Based
on the Phlx's representations that Phlx XL participants that are not
Phlx XL market makers are not disadvantaged by their inability to
submit COOP Sweeps, COLA Sweeps, or CBOOK Sweeps, and by the Phlx's
representation that such non-Phlx XL market maker participants may
submit IOC orders that behave in the same manner as a Sweep, the
Commission believes that it is consistent with the Act for the Phlx to
make COOP Sweeps, COLA Sweeps, and CBOOK Sweeps available only to Phlx
XL market makers, rather than to all Phlx XL participants.\134\ In
addition, to the extent that the availability of Sweeps succeeds in
encouraging Phlx XL market makers to submit trading interest, Sweeps
potentially could result in the availability of additional liquidity in
the marketplace, to the benefit of investors.
---------------------------------------------------------------------------

    \128\ See id. Although Phlx XL market makers may submit either a
Complex Order or a COOP Sweep, the Phlx notes that some market
makers choose to submit their interest in the form of a Complex
Order. See Notice, 80 FR at 35999.
    \129\ See Phlx Rule 1080.07(d)(ii)(B).
    \130\ See Phlx Rules 1080.07(e)(iv) and 1080.07(f)(ii).
    \131\ See Notice, 80 FR at 36004. See also Notice, 80 FR at
35999.
    \132\ See Notice, 80 FR at 36004. Like Sweeps, IOC orders expire
if they are not executed immediately. See also Amendment No. 1
(stating that a non-Phlx XL market maker participant seeking to
submit interest that would expire if it was not executed immediately
would be able to submit an IOC order, and, therefore, that such a
participant would not be disadvantaged by its inability to submit
CBOOK Sweeps).
    \133\ See Notice, 80 FR at 35999.
    \134\ The Commission notes that Complex Orders submitted in
response to a COOP or a COLA function in the same manner as COOP
Sweeps and COLA Sweeps in several respects. Like COOP Sweeps and
COLA Sweeps, Complex Orders submitted in response to a COOP or a
COLA will not be visible to Phlx XL participants or disseminated by
the Phlx. See Phlx Rules 1080.07(d)(ii)(B)(3) and 1080.07(e)(iv)(C)
and Amendment No. 2. In addition, Complex Orders submitted in
response to a COOP or a COLA, like COOP Sweeps and COLA Sweeps, may
be submitted in $0.01 increments on either or both sides of the
market. See Phlx Rules 1080.07(d)(ii)(B) and 1080.07(e)(iv) and
Amendment No. 2.
---------------------------------------------------------------------------

    As discussed above, the proposal also describes the handling of IOC
and DNA orders during the opening process.\135\ The Commission believes
that the handling of these orders during the opening will provide
market participants with flexibility to determine the manner in which
they will trade at the opening.\136\ IOC and DNA orders received prior
to the initiation of the COOP will be cancelled, although a COOP will
occur in the Complex Order Strategy of the IOC or DNA order.\137\ The
Commission believes that conducting a COOP for a Complex Order Strategy
represented by the cancelled IOC or DNA order could benefit investors
by allowing the opening of a Complex Order Strategy that investors had
indicated an interest in trading.
---------------------------------------------------------------------------

    \135\ See Phlx Rule 1080.07(d)(ii)(A)(5).
    \136\ Under Phlx Rule 1080.07(d)(ii)(A)(5), IOC orders received
during the COOP will join the COOP but will be cancelled at the end
of the COOP Timer if they are not executed. DNA orders received
during the COOP will be cancelled and will not participate in the
COOP.
    \137\ See Phlx Rule 1080.07(d)(ii)(A)(5).
---------------------------------------------------------------------------

    Under the proposal, orders from Firms are treated like orders from
market makers for purposes of triggering a COLA and for purposes of
determining the execution price that their orders will receive when
trading against a COLA-eligible order. Specifically, under Phlx Rule
1080.07(e)(i)(B)(1), as amended, proprietary orders from Firms, like
orders from market makers, will not be COLA-eligible and therefore will
not trigger a COLA. In contrast, orders from non-market maker off-floor
broker-dealers that are not Firms will be COLA-eligible.\138\ The Phlx
believes that the ability of Firm proprietary orders to start a COLA
could impede the ability of other orders to initiate a COLA.\139\ In
addition, the Phlx believes that it could impede the submission of
competitive responses or quoting if market makers were hesitant to
provide aggressive prices for COLAs that may have been initiated by
Firms.\140\ The Commission notes that other options exchanges have

flexibility in determining the orders that may initiate a complex order
auction.\141\
---------------------------------------------------------------------------

    \138\ See Notice, 80 FR at 36003.
    \139\ See Amendment No. 1.
    \140\ See id.
    \141\ See, e.g., CBOE Rule 6.53C(d)(i)(2) (defining a Complex
Order Auction (``COA'')-eligible order as a complex order that, as
determined by the CBOE on a class-by-class basis, is eligible for a
COA considering, among other things, the complex order origin type
(i.e., non-broker-dealer public customer, broker-dealers that are
not market makers or specialists on another options exchange, and/or
market makers or specialists on another options exchange); and NYSE
Arca Rule 6,91(c)(1) (defining a COA-eligible order to mean an
Electronic Complex Order that, as determined by NYSE Arca on a
class-by-class basis, is eligible for a COA, considering, among
other things, the order origin type (i.e., Customers, broker-dealers
that are not Market Makers or specialists on an options exchange,
and/or Market Makers or specialists on an options exchange).
---------------------------------------------------------------------------

    Phlx Rule 1080.07(e)(viii)(C)(2), as amended, treats Firm orders
like market maker orders for purposes of determining the execution
price that their orders will receive when executing against a COLA-
eligible order.\142\ The Phlx notes that Firms are large, well-
capitalized broker-dealers that generally submit large orders,
including orders that facilitate their clients' orders or offset often
large positions taken to accommodate their customers.\143\ The Phlx
states that Firms, like market makers, are commonly viewed as providers
of liquidity.\144\ The proposal also revises Phlx Rule
1080.07(e)(viii)(C)(2) to indicate that the System executes non-
customer orders not in time priority, but on a pro-rata basis among
Phlx market-maker interest and then among remaining Firm and non-Phlx
market maker interest at each price level. The Commission notes that
this allocation methodology is consistent with existing Phlx Rule
1080.07(e)(vi)(B). The proposal amends Phlx Rule
1080.07(e)(viii)(C)(1)(d) to indicate that non-broker-dealer customer
orders at the same price will be executed in time priority, while non-
Firm, non-market maker off-floor broker-dealer orders at the same price
will be executed on a pro-rata basis at each price level. The
Commission notes that this allocation methodology also is consistent
with existing Phlx rules.\145\
---------------------------------------------------------------------------

    \142\ In contrast, Phlx Rule 1080.07(e)(viii)(C)(1), as amended,
treats non-market maker off-floor broker-dealers that are not Firms
like non-broker-dealer customers for purposes of determining the
execution price that their orders will receive when executing
against a COLA-eligible order. The Phlx states that non-market maker
off-floor broker-dealers that are not Firms seek liquidity and are
therefore more like customers than other participants, which
generally provide liquidity. See Notice, 80 FR at 36002.
    \143\ See Notice, 80 FR at 36003-36004.
    \144\ See Notice, 80 FR at 36004.
    \145\ See, e.g., Phlx Rule 1080.07(e)(vi)(B).
---------------------------------------------------------------------------

    The proposal revises Phlx Rule 1080.07(f)(i)(F) to indicate that a
Complex Order received during the final configurable number of seconds
of the trading session, rather than during the final 10 seconds of the
trading session, will be placed on the CBOOK after any marketable
portion of the Complex Order is executed. The Phlx states that a COLA
auction may be triggered and completed in less than 10 seconds, and
thus that the 10-second time period is too long and could prevent
executions from occurring.\146\ The Commission believes that the
revised rule will provide the Phlx with flexibility to reduce the time
period at the end of the trading session during which an order will be
placed on the CBOOK, which could permit more COLAs to occur and
potentially result in a greater number of order executions, to the
benefit of investors. The Commission notes that the Phlx will notify
participants on its Web site in advance of a change in the number of
seconds at the end of a trading session during which an order will be
placed on the CBOOK.\147\
---------------------------------------------------------------------------

    \146\ See Notice, 80 FR at 36002.
    \147\ See id.
---------------------------------------------------------------------------

    The Commission believes that the proposed changes to the spread
priority provisions in Phlx Rule 1080.07(c)(iii) will benefit market
participants by clarifying the operation of the rule. Among other
things, the proposed changes make clear that a Complex Order may not be
executed at the cPBBO if there is non-broker-dealer customer interest
at the cPBBO and that, if any of the bids or offers established in the
marketplace consist of a non-broker-dealer customer order, than at
least one leg of the Complex Order must be executed at a price better
than the established price for that leg by the minimum trading
increment.\148\
---------------------------------------------------------------------------

    \148\ See Amendment No. 1. See also Phlx Rules
1080.07(d)(ii)(C)(2) and 1080.07(e)(viii)(C)(3) (stating that
executable interest in the COOP and the COLA, respectively, includes
any interest that could be executed without trading through residual
Complex Order interest or the cPBBO, or without trading at the cPBBO
where there is non-broker-dealer customer interest).
---------------------------------------------------------------------------

    The Commission believes that the proposal to revise Phlx Rule
1080.07(b)(iii) to state that Floor Brokers using the Options Floor
Broker Management System may enter Complex Orders as IOC only on behalf
of ``SQTs, RSQTs, non-SQT ROTs, specialists, non-Phlx market makers on
another exchange, and Firms,'' rather than on behalf of ``broker-
dealers or affiliates of broker-dealers'' will clarify the rule by
using more precise terms that are defined in Phlx Rule 1080.07.
    The proposal also deletes two provisions that refer, incorrectly,
to the disengagement of the Phlx's automated execution system.\149\ The
Phlx notes that the Exchange does not and cannot disengage its
automatic execution system, which is a fundamental aspect of the
System.\150\ The Commission believes that correcting these inaccuracies
will benefit investors by helping to assure that the Phlx's rules
correctly describe the operation of the System.
---------------------------------------------------------------------------

    \149\ See Phlx Rules 1080.07(d)(ii)(A)(2) and 1080.07(c)(ii)(D).
See also Amendment No. 1.
    \150\ See Notice, 80 FR at 35998.
---------------------------------------------------------------------------

    Finally, the proposal establishes rules governing the trading of
all-or-none Complex Orders, including provisions that describe the
treatment of all-or-none Complex Orders at the opening and indicate
that all-or-none Complex Orders will not execute against interest in
the individual leg market.\151\ The Phlx states that the all-or-none
contingency is particularly appropriate for Complex Orders because the
size of the order may be relevant to a market participant's
strategy.\152\ The Commission believes that rules governing the trading
of all-or-none Complex Orders should provide for the orderly trading of
all-or-none Complex Orders on the System. The Commission also believes
that all-or-none Complex Orders could provide investors and other
market participants with additional flexibility to effectuate their
investment strategies. The Commission notes that other options
exchanges also provide for the trading of all-or-none complex
orders.\153\
---------------------------------------------------------------------------

    \151\ See Phlx Rules 1080.07(d)(ii)(C), 1080.07(e)(vi)(A)(1),
and 1080.07(f)(iii)(A). The Phlx states that all-or-none Complex
Orders do not execute against individual leg market interest because
the all-or-none contingency complicates the expeditious execution of
these orders against individual leg market interest. See Notice, 80
FR at 36005.
    \152\ See Notice, 80 FR at 36005.
    \153\ See, e.g., NYSE Arca Rule 6.91(b)(2) and NYSE MKT Rule
980NY(d)(2).
---------------------------------------------------------------------------

IV. Accelerated Approval of Proposed Rule Change, as Modified by
Amendment Nos. 1 and 2

    The Commission finds good cause to approve the proposed rule
change, as modified by Amendment Nos. 1 and 2, prior to the 30th day
after the date of publication of notice of Amendment Nos. 1 and 2 in
the Federal Register. In Amendment Nos. 1 and 2, the Phlx revised the
proposal to make the changes discussed in detail above. Notably, in
Amendment No. 1 the Phlx provides additional rationale for its proposal
to prevent Firm orders from triggering a COLA, adds a provision
describing the operation of CBOOK Sweeps, clarifies the spread priority
provisions in Phlx Rule 1080.07(c)(iii), and establishes an
implementation period for all-or-none Complex Orders. Amendment No. 1
also added clarifying

details to several rules. The Commission believes that Amendment No. 1
does not raise any novel regulatory issues and instead provides
additional clarity to the rule text, along with additional analysis of
how the proposal is consistent with the Act, thus facilitating the
Commission's ability to make the findings set forth above to approve
the proposal. Amendment No. 2 revises Phlx Rule 1080.07(e)(iv) to
indicate that Phlx XL participants may respond to a COLA auction by
submitting Complex Orders in $0.01 increments. Amendment No. 2 also
describes the treatment of Complex Orders submitted during a COLA and
provides additional details regarding Complex Orders submitted during
the COOP. The Commission believes that Amendment No. 2 does not raise
any novel regulatory issues and provides clarity regarding the manner
in which Phlx XL participants may participate in the COLA and the COOP.
Accordingly, the Commission finds that good cause exists to approve the
proposal, as modified by Amendment Nos. 1 and 2, on an accelerated
basis.

V. Solicitation of Comments on Amendment Nos. 1 and 2

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether Amendment Nos. 1
and 2 to the proposed rule change are 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-Phlx-2015-49 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-Phlx-2015-49. 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-Phlx-2015-49 and should be
submitted on or before January 19, 2016.

VI. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\154\ that the proposed rule change (SR-Phlx-2015-49), as modified
by Amendment Nos. 1 and 2, is approved on an accelerated basis.
---------------------------------------------------------------------------

    \154\ 15 U.S.C. 78s(b)(2)).
    \155\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\155\
Brent J. Fields,
Secretary.
[FR Doc. 2015-32654 Filed 12-28-15; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 82, Number 42 (Monday, March 6, 2017)]
[Notices]
[Page 12626]
[FR Doc No: 2017-04232]

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

DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Docket ID FEMA-2017-0002; Internal Agency Docket No. FEMA-B-1657]

Proposed Flood Hazard Determinations

AGENCY: Federal Emergency Management Agency; DHS.

ACTION: Notice; correction.

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

SUMMARY: On November 28, 2016, FEMA published in the Federal Register a
proposed flood hazard determination notice that contained an erroneous
table. This notice provides corrections to that table, to be used in
lieu of the information published at 81 FR 85622. The table provided
here represents the proposed flood hazard determinations and
communities affected for Davis County, Iowa and Incorporated Areas.

DATES: Comments are to be submitted on or before June 5, 2017.

ADDRESSES: The Preliminary Flood Insurance Rate Map (FIRM), and where
applicable, the Flood Insurance Study (FIS) report for each community
are available for inspection at both the online location and the
respective Community Map Repository address listed in the table below.
Additionally, the current effective FIRM and FIS report for each
community are accessible online through the FEMA Map Service Center at
www.msc.fema.gov for comparison.
    You may submit comments, identified by Docket No. FEMA-B-1657, to
Rick Sacbibit, Chief, Engineering Services Branch, Federal Insurance
and Mitigation Administration, FEMA, 400 C Street SW., Washington, DC
20472,<PHONE_NUMBER>, or (email<EMAIL_ADDRESS>
FOR FURTHER INFORMATION CONTACT: Rick Sacbibit, Chief, Engineering
Services Branch, Federal Insurance and Mitigation Administration, FEMA,
400 C Street SW., Washington, DC 20472,<PHONE_NUMBER>, or (email)
<EMAIL_ADDRESS>or visit the FEMA Map Information
eXchange (FMIX) online at www.floodmaps.fema.gov/fhm/fmx_main.html.

SUPPLEMENTARY INFORMATION: FEMA proposes to make flood hazard
determinations for each community listed in the table below, in
accordance with Section 110 of the Flood Disaster Protection Act of
1973, 42 U.S.C. 4104, and 44 CFR 67.4(a).
    These proposed flood hazard determinations, together with the
floodplain management criteria required by 44 CFR 60.3, are the minimum
that are required. They should not be construed to mean that the
community must change any existing ordinances that are more stringent
in their floodplain management requirements. The community may at any
time enact stricter requirements of its own, or pursuant to policies
established by other Federal, State, or regional entities. These flood
hazard determinations are used to meet the floodplain management
requirements of the NFIP and are also used to calculate the appropriate
flood insurance premium rates for new buildings built after the FIRM
and FIS report become effective.
    Use of a Scientific Resolution Panel (SRP) is available to
communities in support of the appeal resolution process. SRPs are
independent panels of experts in hydrology, hydraulics, and other
pertinent sciences established to review conflicting scientific and
technical data and provide recommendations for resolution. Use of the
SRP may only be exercised after FEMA and local communities have been
engaged in a collaborative consultation process for at least 60 days
without a mutually acceptable resolution of an appeal. Additional
information regarding the SRP process can be found online at http://floodsrp.org/pdfs/srp_fact_sheet.pdf.
    The communities affected by the flood hazard determinations are
provided in the table below. Any request for reconsideration of the
revised flood hazard determinations shown on the Preliminary FIRM and
FIS report that satisfies the data requirements outlined in 44 CFR
67.6(b) is considered an appeal. Comments unrelated to the flood hazard
determinations will also be considered before the FIRM and FIS report
are made final.

Correction

    In the proposed flood hazard determination notice published at 81
FR 85622 in the November 28, 2016, issue of the Federal Register, FEMA
published a table titled ``Davis County, Iowa and Incorporated Areas''.
This table contained inaccurate information as to the address of the
community map repository for the City of Bloomfield featured in the
table.
    In this document, FEMA is publishing a table containing the
accurate information. The information provided below should be used in
lieu of that previously published.

(Catalog of Federal Domestic Assistance No. 97.022, ``Flood
Insurance.'')

    Dated: February 16, 2017.
Roy E. Wright,
Deputy Associate Administrator for Insurance and Mitigation, Department
of Homeland Security, Federal Emergency Management Agency.

    I. Non-watershed-studies:

------------------------------------------------------------------------
                                             Community map repository
               Community                             address
------------------------------------------------------------------------
                Davis County, Iowa and Incorporated Areas
------------------------------------------------------------------------
Maps Available for Inspection Online at: http://www.fema.gov/preliminaryfloodhazarddata preliminaryfloodhazarddata
------------------------------------------------------------------------
          Project: 16-07-0174S Preliminary Date: April 12, 2016
------------------------------------------------------------------------
City of Bloomfield.....................  City Hall, 111 West Franklin
                                          Street, Bloomfield, IA 52537.
City of Floris.........................  City Hall, 103 Monroe Street,
                                          Floris, IA 52560.
Unincorporated Areas of Davis County...  Davis County Highway
                                          Department, 21585 Lilac
                                          Avenue, Bloomfield, IA 52537.
------------------------------------------------------------------------

[FR Doc. 2017-04232 Filed 3-3-17; 8:45 am]
 BILLING CODE 9110-12-P