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Notice

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending NYSE Arca Equities Rule 7.31(pp) To Change the Primary After 3:45 Order to a Primary After 3:55 Order

 

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May 21, 2012.

Pursuant to Section 19(b)(1) [1] of the Securities Exchange Act of 1934 (the “Act”) [2] and Rule 19b-4 thereunder, [3] notice is hereby given that, on May 10, 2012, NYSE Arca, Inc. (the “Exchange” or “NYSE Arca”) filed with the Securities and Exchange Commission (the “Commission”) the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.

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

The Exchange proposes to amend NYSE Arca Equities Rule 7.31(pp) to change the Primary After 3:45 Order to a Primary After 3:55 Order. The text of the proposed rule change is available at the Exchange, the Commission's Public Reference Room, and www.nyse.com.

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

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

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

1. Purpose

The Exchange proposes to amend NYSE Arca Equities Rule 7.31(pp) to change the Primary After 3:45 Order to a Primary After 3:55 Order.

Currently, the Primary After 3:45 Order can be entered for participation on the Exchange until 3:45 p.m. Eastern Time (12:45 p.m. Pacific Time), after which time the order is cancelled on the Exchange and an order is entered for participation on the primary market. These orders can be Day only and may not be designated as GTC or GTD. Any such orders that are routed to the primary market at 3:45 p.m. Eastern Time retail [sic] their original order attributes.

The Exchange proposes to amend the rule to provide that such orders can be entered for participation on the Exchange until 3:55 p.m. Eastern Time (12:55 p.m. Pacific Time) instead of 3:45 p.m. Eastern Time. As proposed the order type would be renamed the “Primary After 3:55 Order.” Other than the time change, the Exchange does not propose any changes to the order type.

The Exchange is proposing this time change to [sic] in order to provide greater opportunity for ETP Holders that use this order type to obtain an Exchange execution before it is routed to the primary market. In particular, because the Exchange's rebate is currently higher than those on the primary markets, the Exchange believes that providing a longer opportunity for an execution on the Exchange would benefit ETP Holders, while at the same time continuing to provide an opportunity for such orders to be routed to the primary market in time for the closing auction.

2. Statutory Basis

The proposed rule change is consistent with Section 6(b) of the Securities Exchange Act of 1934 (the “Act”), [4] in general, and furthers the objectives of Section 6(b)(5), [5] in particular, because it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system and, in general, to protect investors and the public interest. The Exchange believes that the proposed change to the Primary After 3:45 Order meets these requirements because it will provide ETP Holders who use this order type with a longer period that it would be possible to obtain an execution on the Exchange before the order is routed to the primary market.

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

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

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

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

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

Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days after the date of the filing, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act [6] and Rule 19b-4(f)(6) [7] thereunder.

NYSE Arca has asked the Commission to waive the 30-day operative delay. [8] NYSE Arca believes that implementing the proposed change to the Primary After 3:45 Order type along with other technology changes scheduled for May 28, 2012, will reduce customer confusion as customers will only have to digest a single technology release for Exchange order-type changes, as opposed to a series of technology releases. The Commission finds that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because it will allow NYSE Arca to implement the proposed rule change along with other technology changes, which should facilitate a more seamless transition for members and customers alike. Accordingly, the Commission designates the proposal operative upon filing. [9]

At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments Back to Top

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

Electronic Comments

Paper Comments

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

All submissions should refer to File Number SR-NYSEArca-2012-42 . This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEArca-2012-42 and should be submitted on or before June 15, 2012.

For the Commission, by the Division of Trading and Markets, pursuant to delegated authority. [10]

Kevin M. O'Neill,

Deputy Secretary.

[FR Doc. 2012-12720 Filed 5-24-12; 8:45 am]

BILLING CODE 8011-01-P

Footnotes Back to Top

1. 15 U.S.C.78s(b)(1).

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7. 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intent to file the proposed rule change at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement.

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9. For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule change's impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f).

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