[Federal Register Volume 80, Number 46 (Tuesday, March 10, 2015)]
[Notices]
[Pages 12655-12660]
[FR Doc No: 2015-05482]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74435; File No. SR-EDGA-2015-10]

Self-Regulatory Organizations; EDGA Exchange, Inc.; Notice of
Filing of a Proposed Rule Change, as Modified by Amendment No. 1, To
Amend Rules 11.6, 11.8, 11.9, 11.10 and 11.11 of EDGA Exchange, Inc.

March 4, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on February 20, 2015, EDGA Exchange, Inc. (the ``Exchange'' or
``EDGA'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II
and III below, which items have been prepared by the self-regulatory
organization. On February 27, 2015, the Exchange filed Amendment No. 1
to the proposal.\3\ The Commission is publishing this notice, as
modified by Amendment No. 1, to solicit comments on the proposed rule
change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Amendment No. 1 replaces SR-EDGA-2015-10 and supersedes such
filing in its entirety.
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I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change

    The Exchange filed a proposal to amend Rules 11.6, 11.8, 11.9,
11.10 and 11.11 to clarify and to include additional specificity
regarding the current functionality of the Exchange's System,\4\
including the operation of its order types and order instructions, as
further described below.
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    \4\ The term ``System'' is defined as ``the electronic
communications and trading facility designated by the Board through
which securities orders of Users are consolidated for ranking,
execution and, when applicable, routing away.'' See Exchange Rule
1.5(cc).
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    The text of the proposed rule change is available at the Exchange's
Web site at www.batstrading.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.

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

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

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

1. Purpose
    On June 5, 2014, Chair Mary Jo White asked all national securities
exchanges to conduct a comprehensive review of each order type offered
to members and how it operates.\5\ The Exchange notes that a
comprehensive rule filing clarifying and updating Exchange rules was
recently approved.\6\ However, based on the request from Chair White,
the Exchange did indeed conduct further review of each order types and
its operation. The proposals set forth below are based on this
comprehensive review and are intended to clarify and to include
additional specificity regarding the current functionality of the
Exchange's System, including the operation of its order types and order
instructions. The proposals set forth below are intended to supplement
the recently approved filing based on further review conducted by the
Exchange and are intended to clarify and enhance the understandability
of

the Exchange's rules related to the ranking and execution of orders.
The proposal is also intended to add additional detail with respect to
the handling of orders with a Discretionary Range \7\ instruction. The
Exchange is not proposing any substantive modifications to the System.
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    \5\ See Mary Jo White, Chair, Commission, Speech at the Sandler
O'Neill & Partners, L.P. Global Exchange and Brokerage Conference,
(June 5, 2014) (available at http://www.sec.gov/News/Speech/Detail/Speech/1370542004312#.VD2HW610w6Y).
    \6\ Securities Exchange Act Release No. 73592 (November 13,
2014), 79 FR 68937 (November 19, 2014) (SR-EDGA-2014-20).
    \7\ See Exchange Rule 11.6(d).
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Orders With a Discretionary Range
    Pursuant to current Rule 11.6(d), the Exchange defines a
Discretionary Range as an instruction the User \8\ may attach to an
order to buy (sell) a stated amount of a security at a specified,
displayed price with discretion to execute up (down) to a specified,
non-displayed price. For purposes of this proposal, the Exchange will
use the term ``Discretionary Range'' to describe the amount between the
displayed price to and including the highest price at which a buyer is
willing to buy or lowest price at which a seller is willing to sell.
The Exchange proposes to make clear that although an order with a
Discretionary Range instruction may be accompanied by a Displayed \9\
instruction, an order with a Discretionary Range instruction may also
be accompanied by a Non-Displayed instruction, and if so, will have a
non-displayed ranked price as well as a discretionary price. The
Exchange further proposes to specifically state that resting orders
with a Discretionary Range instruction will be executed at a price that
uses the minimum amount of discretion necessary to execute the order
against an incoming order. In addition, the Exchange proposes to make
clear certain circumstances where the Discretionary Range of an order
is temporarily reduced due to contra-side interest resting on the EDGA
Book.\10\
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    \8\ The term ``User'' is defined as ``any Member or Sponsored
Participant who is authorized to obtain access to the System
pursuant to Rule 11.3.'' See Exchange Rule 1.5(ee).
    \9\ See Exchange Rule 11.6(e)(1).
    \10\ The term ``EDGA Book'' is defined as ``the System's
electronic file of orders.'' See Exchange Rule 1.5(d).
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    The Exchange also proposes to specify certain situations where the
Discretionary Range of an order could be temporarily reduced based on
contra-side interest resting on the Exchange. The Exchange notes that
an order with a Post Only instruction \11\ will, in all cases, remove
contra-side liquidity from the EDGA Book because under its current
taker-maker pricing structure, the remover of liquidity is provided a
rebate while the provider of liquidity is charged a fee. Therefore, in
all cases, the value of the execution to remove liquidity will equal or
exceed the value of such execution once posted to the EDGA Book,
including the applicable fees charged or rebates received. However, the
Exchange proposes to adopt language to reflect the operation of the
System in the event the Exchange's fee structure is modified and an
order with a Post Only instruction is able to be posted to the EDGA
Book without removing liquidity. The Exchange notes that if this were
the case, it would be possible for an order with a Discretionary Range
instruction to have its Discretionary Range temporarily reduced based
on contra-side interest resting on the Exchange because an incoming
order with a Post Only instruction would be posted to the EDGA Book
rather than executing against the Discretionary Range of a resting
order.
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    \11\ See Exchange Rule 11.6(n)(4).
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    With respect to displayed contra-side liquidity, the Exchange
proposes to make clear that if an order posted to the EDGA Book has a
Discretionary Range and there is a contra-side order that is displayed
by the System on the EDGA Book within such Discretionary Range, the
order with a Discretionary Range will not be permitted to execute at
the price of or at a price more aggressive than such contra-side
displayed order unless and until there is no contra-side displayed
order on the EDGA Book within the Discretionary Range. In such case,
the order with a Discretionary Range will have discretion to one
Minimum Price Variation \12\ below (above) the contra-side offer (bid)
that is displayed by the System on the EDGA Book.
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    \12\ See Exchange Rule 11.6(i).
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    With respect to non-displayed contra-side liquidity, the Exchange
proposes to make clear that if an order posted to the EDGA Book has a
Discretionary Range and there is a contra-side order with a Non-
Displayed instruction,\13\ the order with a Discretionary Range will
not be permitted to execute at a price more aggressive than the ranked
price of such contra-side order unless and until there is no contra-
side order on the EDGA Book within the Discretionary Range. In such
case, the order with a Discretionary Range will have discretion to the
ranked price of the contra-side offer (bid) with a Non-Displayed
instruction that is maintained by the System on the EDGA Book.
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    \13\ The Exchange notes that the reference to orders with a Non-
Displayed instruction is intended to apply to all orders that are
not displayed on the Exchange, such as MidPoint Peg Orders as
defined in Rule 11.8(d).
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    The Exchange notes that the language proposed with respect to the
temporary reduction of the Discretionary Range of an order is
consistent with the Exchange's recently amended rules.\14\
Specifically, the Exchange suspends the discretion of an order subject
to the Displayed Price Sliding \15\ instruction for so long as a
contra-side order that equals the Locking Price \16\ is displayed by
the System on the EDGA Book. The Exchange suspends this discretion to
avoid an apparent priority issue. In particular, in such a situation
the Exchange believes a User representing an order that is displayed on
the Exchange might believe that an incoming order was received by the
Exchange and then bypassed such displayed order, removing some other
non-displayed liquidity on the same side of the market as such
displayed order. For the same reason, the Exchange believes it is
appropriate to prevent an order with a Discretionary Range instruction
to execute at the same price or at a price more aggressive than a
contra-side order that is displayed on the EDGA Book. Similarly,
although the Exchange believes it is appropriate to permit an order
with a Discretionary Range instruction to execute at the same price as
a contra-side order with a Non-Displayed instruction, the Exchange
suspends such discretion at any more aggressive prices in order to
avoid trading through orders that have been ranked on and are resting
on the EDGA Book.
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    \14\ See supra note 6.
    \15\ See Exchange Rule 11.6(l)(1)(B).
    \16\ See Exchange Rule 11.6(f).
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    Below are examples of the operation of orders with a Discretionary
Range.
Example No. 1: Modification and Reinstatement of Discretionary Range
With a Displayed Contra-Side Order
    Assume the NBBO is $10.00 by $10.10, that the best-priced order to
buy in the System is a displayed bid at $9.99, and that the best-priced
order to sell in the System is a displayed offer at $10.11. Also assume
that orders with a Post Only instruction do not remove liquidity from
the EDGA Book because the value of an execution would not equal or
exceed the value of an execution if posted at its limit price,
including the applicable fees charged or rebates provided under
proposed Rule 11.6(n)(4).\17\ A Limit Order \18\ to buy 100 shares at
$10.00 with a Discretionary Range of $0.05 is entered into the System.
The order will be displayed on the EDGA Book at $10.00 with discretion
to execute up to $10.05. If a

Limit Order to sell 100 shares at $10.05 with a Displayed instruction
and a Post Only instruction \19\ is entered into the System such order
will be posted and displayed by the System on the EDGA Book as an order
to sell 100 shares at $10.05. The buy order with the Discretionary
Range instruction will have its discretion to execute at $10.05
temporarily suspended but such order will continue to have discretion
to execute up to $10.04. The following examples demonstrate various
potential outcomes following the temporary suspension of the buy
order's discretion to execute at $10.05.
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    \17\ As described elsewhere in the proposal, under the
Exchange's current pricing structure a Limit Order with a Post Only
instruction will remove contra-side liquidity in all cases.
    \18\ See Exchange Rule 11.8(b).
    \19\ See Exchange Rule 11.6(n)(4).
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     If a non-routable Limit Order to sell 100 shares at $10.05
is entered into the System, depending on applicable User instructions,
such order will either be posted and displayed by the System on the
EDGA Book as an order to sell 100 shares (i.e., with priority behind
the order to sell that is already displayed on the EDGA Book at $10.05)
or will be cancelled back to the entering User.
     If, instead, a Limit Order to sell 100 shares at $10.04 is
entered into the System, such order will execute at $10.04 against the
resting buy order with a Discretionary Range instruction.
     If, instead, a Limit Order to sell 100 shares at $10.02 is
entered into the System, such order will execute at $10.02 against the
resting buy order with a Discretionary Range instruction.
     If, instead, a Limit Order to sell 100 shares at $10.00 or
lower or a Market Order to sell 100 shares is entered into the System,
such order will execute at $10.00 against the resting buy order with a
Discretionary Range instruction.
     If, instead, the sell order at $10.05 with a Post Only
instruction is then canceled, the buy order with a Discretionary Range
instruction with have its discretion to execute up to $10.05
reinstated.
     If, instead, a Limit Order to buy 100 shares at $10.05 or
higher or a Market Order to buy 100 shares is then entered into the
System, such order will execute at $10.05 against the displayed order
to sell with a Post Only instruction and the buy order with a
Discretionary Range instruction will have its discretion to execute up
to $10.05 reinstated.
Example No. 2: Modification and Reinstatement of Discretionary Range
With a Non-Displayed Contra-Side Order
    Assume the NBBO is $10.00 by $10.10, that the best-priced order to
buy in the System is a displayed bid at $9.99, and that the best-priced
order to sell in the System is a displayed offer at $10.11. Also assume
that orders with a Post Only instruction do not remove liquidity from
the EDGA Book because the value of an execution would not equal or
exceed the value of an execution if posted at its limit price,
including the applicable fees charged or rebates provided under
proposed Rule 11.6(n)(4).\20\ A Limit Order with to buy 100 shares at
$10.00 with a Discretionary Range of $0.07 is entered into the System.
The order will be ranked and displayed on the EDGA Book at $10.00 with
discretion to execute up to $10.07. If a Limit Order to sell 100 shares
at $10.06 with a Non-Displayed instruction and a Post Only instruction
is entered into the System such order will be posted by the System on
the EDGA Book as an order to sell 100 shares at $10.06. The buy order's
discretion to execute at $10.07 will be temporarily suspended but such
order will continue to have discretion to execute up to $10.06. The
following examples demonstrate various potential outcomes following the
temporary suspension of the buy order's discretion to execute at
$10.07.
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    \20\ As described elsewhere in the proposal, under the
Exchange's current pricing structure a Limit Order with a Post Only
instruction will remove contra-side liquidity in all cases.
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     If a non-routable Limit Order to sell 100 shares at $10.07
with a Displayed instruction is entered into the System, depending on
applicable User instructions, such order will be posted and displayed
by the System on the EDGA Book as an order to sell 100 shares at $10.07
or will be cancelled back to the entering User.
     If, instead, a Limit Order to sell 100 shares at $10.06 is
entered into the System, such order will execute at $10.06 against the
resting buy order with a Discretionary Range instruction.
     If, instead, a Limit Order to sell 100 shares at $10.02 is
entered into the System, such order will execute at $10.02 against the
resting buy order with a Discretionary Range instruction.
     If, instead, a Limit Order to sell 100 shares at $10.00 or
lower or a Market Order to sell 100 shares is entered into the System,
such order will execute at $10.00 against the resting buy order with a
Discretionary Range instruction.
     If, instead, the sell order with a Non-Displayed
instruction of 100 shares that is ranked at $10.06 is then canceled,
the buy order with a Discretionary Range instruction will have its
discretion to execute up to $10.07 reinstated.
    The Exchange's handling of orders with a Discretionary Range
instruction is intended to reflect the relatively passive nature of
orders with a Discretionary Range. In all cases, although the Users
submitting such orders have indicated a willingness to execute at a
more aggressive price, such orders are ranked at a lower price to buy
or a higher price to sell. In turn, if an order is executed at its
ranked price, rather than at a price within the Discretionary Range,
then the User that submitted the order receives a better result in each
case (i.e., buys for less or sells for more). With this background, the
Exchange believes it is reasonable that an order with a Discretionary
Range instruction might temporarily become not executable at certain
prices because such prices are more aggressive than their ranked price
(i.e., higher prices for orders to buy or lower prices for orders to
sell). Further, to the extent a User would prefer an execution at more
aggressive price levels, such User could simply choose other order type
instructions that would increase the likelihood of execution at these
prices (e.g., a routable order rather than a non-routable order or an
order that is ranked at its full price rather than an order ranked at a
less aggressive price with a Discretionary Range).
    In addition to the changes described above, the Exchange proposes
to re-locate within Rule 11.8(b) and re-word the statement regarding
the inclusion of a Discretionary Range on a Limit Order. Current Rule
11.8(b)(8) currently states that a ``User may include a Discretionary
Range instruction.'' This ability to include a Discretionary Range
instruction on a Limit Order is currently grouped with other
functionality that can be elected for Limit Orders that also include a
Post Only or Book Only instruction as well as specified time-in-force
instructions for orders that can be entered into the System and post to
the EDGA Book. However, the System does not allow the combination of a
Discretionary Range and a Post Only instruction. Accordingly, the
Exchange proposes to re-locate the reference to the Discretionary Range
instruction within Rule 11.8(b) so that it is no longer grouped with
other orders that can be combined with a Post Only instruction. The
Exchange also proposes to state in Rule 11.8(b) that: (i) A Limit Order
with a Discretionary Range instruction may also include a Book Only
instruction; and (ii) a Limit Order with a Discretionary Range
instruction and a Post Only instruction will be rejected. Further, the
Exchange proposes to refer to the ability of a Limit Order to include a
Discretionary Range instruction, rather than a ``User'' that may
include a Discretionary Range instruction.

Priority and Execution Algorithm
    With respect to the Exchange's priority and execution algorithm,
the Exchange is proposing various minor and structural to changes that
are intended to emphasize the processes by which orders are accepted,
priced, ranked, displayed and executed, as well as a new provision
related to the ability of orders to rest at locking prices that is
consistent with the changes to provisions related to the operation of
orders with a Discretionary Range instruction described above. First,
the Exchange has proposed modifications to Rule 11.9, Priority of
Orders, to make clear that the ranking of orders described in such rule
is in turn dependent on Exchange rules related to the execution of
orders, primarily Rule 11.10. The Exchange believes that this has
always been the case under Exchange rules but there was not previously
a description of the cross-reference to Rule 11.10 within such rules.
Accordingly, the Exchange proposes to add reference to the execution
process in addition to the numeric cross-reference to Rule 11.10. The
Exchange also proposes to change certain references within Rule 11.9 to
refer to ranking rather than executing equally priced trading interest,
as the Rule as a whole is intended to describe the manner in which
resting orders are ranked and maintained, specifically in price and
time priority, while awaiting execution against incoming orders. The
Exchange does not believe that the proposed modifications substantively
modify the operation of the rules but the Exchange believes that it is
important to make clear that the ranking of orders is a separate
process from the execution of orders. The Exchange also proposes
changes to Rule 11.9(a)(4) and (a)(5) to specify that orders retain and
lose ``time'' priority under certain circumstances as opposed to
priority generally because retaining or losing price priority does not
require the same descriptions, as price priority will always be
retained unless the price of an order changes.
    Next, the Exchange proposes to move language contained within sub-
paragraph (a)(2) of Rule 11.10 to the main paragraph, paragraph (a),
such that the language is more generally applicable to the rules.
Although sub-paragraph (a)(2) contains information relevant to
executability, in that it describes orders that are executable in
compliance with Regulation NMS or otherwise do not trade through
quotations of other markets, there are other provisions set forth in
paragraph (a) that relate to executability. Accordingly, the Exchange
proposes to relocate language stating that any order falling within the
parameters of this paragraph shall be referred to as ``executable'' and
that an order will be cancelled back to the User, if based on market
conditions, User instructions, applicable Exchange Rules and/or the Act
and the rules and regulations thereunder, such order is not executable,
cannot be routed to another Trading Center pursuant to Rule 11.11 or
cannot be posted to the EDGA Book.
    The Exchange proposes to adopt paragraph (C) of Rule 11.10(a)(4) to
provide further clarity regarding the situations where orders are not
executable, which although covered in other existing rules, would focus
on the incoming order on the same side of an order displayed on the
EDGA Book rather than the resting order that is rendered not executable
because it is opposite such order displayed on the EDGA Book. Proposed
paragraph (C) would further state that if an incoming order is on the
same side of the market as an order displayed on the EDGA Book and upon
entry would execute against contra-side interest at the same price as
such displayed order, such incoming order will be cancelled or posted
to the EDGA Book and ranked in accordance with Rule 11.9. As described
above, the Exchange suspends the ability of an order subject to the
Displayed Price Sliding instruction to execute at the Locking Price for
so long as a contra-side order that equals the Locking Price is
displayed by the System on the EDGA Book. Similarly, as proposed to be
added to EDGA Rules, the Exchange temporarily suspends the ability of
an order to execute at the same price as a contra-side displayed order
for any order with a Discretionary Range instruction. The Exchange
temporarily suspends this discretion to avoid an apparent priority
issue where a User representing an order that is displayed on the
Exchange either believes such order has time priority among displayed
orders at that price or that the displayed order is the only order at
such price level and then sees an execution published by the Exchange
at that price.
    To demonstrate the functionality in place on the Exchange described
above, assume the NBBO is $10.00 by $10.01. Also assume that orders
with a Post Only instruction do not remove liquidity from the EDGA Book
because the value of an execution would not equal or exceed the value
of an execution if posted at its limit price, including the applicable
fees charged or rebates provided under proposed Rule 11.6(n)(4).\21\ A
non-routable Limit Order to buy 100 shares at $10.01 with a Displayed
Price Sliding instruction is entered into the System. The order will be
displayed on the EDGA Book at $10.00 and ranked at $10.01. If a Limit
Order to sell 100 shares at $10.01 with a Displayed instruction and a
Post Only instruction is entered into the System such order will be
posted and displayed by the System on the EDGA Book as an order to sell
100 shares at $10.01. The buy order with the Displayed Price Sliding
instruction will no longer be executable at $10.01 but will continue to
be displayed and executable at $10.00. The following examples
demonstrate various potential outcomes following the temporary
suspension of the buy order's ability to execute at $10.01.
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    \21\ As described elsewhere in the proposal, under the
Exchange's current pricing structure a Limit Order with a Post Only
instruction will remove contra-side liquidity in all cases.
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     If a non-routable Limit Order to sell 100 shares at $10.01
is entered into the System, depending on applicable User instructions,
such order will either be posted and displayed by the System on the
EDGA Book as an order to sell 100 shares (i.e., with priority behind
the order to sell that is already displayed on the EDGA Book at $10.01)
or will be cancelled back to the entering User.
     If, instead, a Limit Order to sell 100 shares at $10.00 is
entered into the System, such order will execute at $10.00 against the
resting buy order with a Displayed Price Sliding instruction.
     If, instead, a Limit Order to buy 100 shares at $10.01 or
higher or a Market Order to buy 100 shares is entered into the
System,\22\ such order will execute at $10.01 against the resting sell
order displayed on the EDGA Book, as such

resting order is fully executable and displayed as an offer on the EDGA
Book.
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    \22\ The Exchange notes that an incoming order for purposes of
comparison to a resting order can be any incoming order unless the
terms of that incoming order itself preclude execution. In this
example, a Limit Order to buy 100 shares at $10.01 that executes
against the order to sell displayed at $10.01 on the EDGA Book could
be a Limit Order with a Displayed instruction, a Limit Order with a
Non-Displayed instruction, a Limit Order with a Displayed Price
Sliding instruction, a Limit Order with a Price Adjust instruction,
a routable Limit Order, a non-routable Limit Order, an order with a
Limit Price of $10.00 and a Discretionary Range of $0.01, or any
other type of incoming Limit Order to buy that is executable at
$10.01. Thus, this example demonstrates that on entry the incoming
order is compared to contra-side orders on the EDGA Book regardless
of the modifiers that will determine how it will be displayed,
ranked or otherwise handled by the System and that unless the
ability of an order to execute has been suspended based on the
Exchange's rules, the resting contra-side order with priority at
that price will be executed against the incoming order.
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    The Exchange notes that it is proposing to add descriptive titles
to paragraphs (A) and (B) of Rule 11.10(a)(4), which describe the
process by which executable orders are matched within the System.
Specifically, so long as it is otherwise executable, an incoming order
to buy will be automatically executed to the extent that it is priced
at an amount that equals or exceeds any order to sell in the EDGA Book
and an incoming order to sell will be automatically executed to the
extent that it is priced at an amount that equals or is less than any
other order to buy in the EDGA Book. These rules further state that an
order to buy shall be executed at the price(s) of the lowest order(s)
to sell having priority in the EDGA Book and an order to sell shall be
executed at the price(s) of the highest order(s) to buy having priority
in the EDGA Book. The Exchange emphasizes these current rules only
insofar as to highlight the interconnected nature of the priority rule.
    The Exchange also proposes to modify paragraph (h) of Rule 11.11 to
clarify the Exchange's rule regarding the priority of routed orders.
Paragraph (h) currently sets forth the proposition that a routed order
does not retain priority on the Exchange while it is being routed to
other markets. The Exchange believes that its proposed clarification to
paragraph (h) is appropriate because it more clearly states that a
routed order is not ranked and maintained in the EDGA Book pursuant to
Rule 11.9(a), and therefore is not available to execute against
incoming orders pursuant to Rule 11.10.
2. Statutory Basis
    The Exchange believes that the proposed rule changes are consistent
with Section 6(b) of the Securities Exchange Act of 1934 (the ``Act'')
\23\ and further the objectives of Section 6(b)(5) of the Act \24\
because they are designed 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, to foster cooperation and
coordination with persons engaged in facilitating transactions in
securities, and, in general, to protect investors and the public
interest. The proposed rule changes are also designed to support the
principles of Section 11A(a)(1) \25\ of the Act in that they seek to
assure fair competition among brokers and dealers and among exchange
markets.
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    \23\ 15 U.S.C. 78f(b).
    \24\ 15 U.S.C. 78f(b)(5).
    \25\ 15 U.S.C. 78k-1(a)(1).
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    Specifically, the Exchange also believes that the changes to
provide additional clarity and specificity regarding the functionality
of the System with respect to an order with a Discretionary Range
instruction would promote just and equitable principles of trade and
remove impediments to a free and open market by providing greater
transparency concerning the operation of the System. The Exchange also
believes that the proposed amendments to clarify and re-structure the
Exchange's priority, execution and routing rules will contribute to the
protection of investors and the public interest by making the
Exchange's rules easier to understand. As described above, the Exchange
has proposed to adopt rules that describe functionality in the System
that will only be implicated to the extent an order with a Post Only
instruction does not remove liquidity on entry and is posted to the
EDGA Book. As also described above, under the Exchange's current
pricing structure, an order with a Post Only instruction will, in all
cases, remove contra-side liquidity from the EDGA Book. However, the
Exchange proposes to adopt language to reflect the operation of the
System in the event the Exchange's fee structure is modified and an
order with a Post Only instruction is able to be posted to the EDGA
Book without removing liquidity.
    The Exchange believes that it is consistent with the Act to
temporarily reduce the Discretionary Range of an order that has been
posted to the EDGA Book for so long as there is contra-side liquidity
on the EDGA Book because this functionality prevents an apparent
priority issue on the EDGA Book as described above as well as the
ability of an order to execute at a price that trades through the
ranked price of an order resting on the EDGA Book. The Exchange
reiterates that such behavior, as described above, is temporary in
nature; an order's full Discretionary Range will be returned as soon as
the contra-side liquidity that caused the reduction in the first place
is no longer maintained on the EDGA Book. The Exchange believes that
its overall handling of orders, including the temporary suspension of
the ability of an order with a Discretionary Range to execute at one or
more prices is consistent with the Act because it removes impediments
to and perfects the mechanism of a free and open market and a national
market system by reflecting the relatively passive nature of an order
with a Discretionary Range instruction while honoring the instructions
of a User submitting a contra-side order that does not remove liquidity
on entry. As explained above, the Exchange's handling of orders with a
Discretionary Range instruction is intended to reflect the relatively
passive nature of orders with a Discretionary Range. The Exchange
believes it is reasonable that an order with a Discretionary Range
instruction might temporarily become not executable at certain prices
because such prices are more aggressive than their ranked price (i.e.,
higher prices for orders to buy or lower prices for orders to sell).
Further, to the extent a User would prefer an execution at more
aggressive price levels, such User could simply choose other order type
instructions that would increase the likelihood of execution at these
prices. Finally, the Exchange believes that its proposal to re-locate
and re-word the Discretionary Range instruction reference within Rule
11.8(b), related to Limit Orders, is consistent with the Act because
the change will correct an error within the Exchange's rules and
prevent potential confusion regarding the ability to combine a
Discretionary Range instruction with a Post Only instruction.

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

    The Exchange does not believe that the proposed rule changes will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The proposed
rule changes are not designed to address any competitive issue but
rather to add specificity and clarity to Exchange rules, thus providing
greater transparency regarding the operation of the System.

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

    The Exchange has neither solicited nor received written comments on
the proposed rule changes.

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 (i) as the Commission may
designate up to 90 days of such date 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, as modified by Amendment No. 1, 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-EDGA-2015-10 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-EDGA-2015-10. 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
a.m. and 3 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-EDGA-2015-10 and should be
submitted on or before March 31, 2015.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\26\
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    \26\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-05482 Filed 3-9-15; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register: January 30, 2006 (Volume 71, Number 19)]
[Notices]
[Page 4947]
[DOCID:fr30ja06-107]

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SECURITIES AND EXCHANGE COMMISSION

Sunshine Act Meeting

    Federal Register Citation of Previous Announcement: [71 FR 3906,
January 24, 2006].

Status: Closed meeting.

Place: 100 F Street, NE., Washington, DC.

Date and Time of Previously Announced Meeting: Thursday, January 26,
2006 at 9 a.m.

Change in the Meeting: Additional items.
    The following items have been added to the 9 a.m. Closed Meeting
scheduled for Thursday, January 26, 2006:

Institution and settlement of injunctive actions; and
Institution and settlement of an administrative proceeding of an
enforcement nature.

    Commissioner Atkins, as duty officer, voted to consider these items
listed for the closed meeting in closed session and that no earlier
notice thereof was possible.
    At times, changes in Commission priorities require alterations in
the scheduling of meeting items. For further information and to
ascertain what, if any, matters have been added, deleted or postponed,
please contact the Office of the Secretary at<PHONE_NUMBER>.

    Dated: January 25, 2006.
Nancy M. Morris,
Secretary.
[FR Doc. 06-878 Filed 1-26-06; 11:34 am]

BILLING CODE 8010-01-P