Daily Rules, Proposed Rules, and Notices of the Federal Government
The Exchange is filing with the Commission a proposal to expand the availability of the Exchange's Risk Management Tool (the "Tool") to all Exchange Members.
The text of the proposed rule change is available at the Exchange's Web site at
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.
The Exchange defines a "Sponsored Participant" as a person who has entered into a sponsorship arrangement with a Sponsoring Member.
To facilitate the ability of a Sponsoring Member to monitor and oversee the sponsored access activity of its Sponsored Participants, the Exchange offers the Sponsored Access Risk Management Tool.
Given recent market events, the Exchange proposes to expand the availability of the Tool to all Members. As amended, the Tool can be configured by a Member to provide an Exchange offered risk management solution. Just as the use of the Tool by a Sponsoring Member does not automatically constitute compliance with Exchange Rules, the Exchange does not believe that use of the Tool can replace Member-managed risk management solutions. However, the Exchange does believe that the Tool can be a valuable
As is currently the case, orders subject to the Tool will be validated by the Exchange prior to entering the Exchange's matching engine. Based on parameters provided to the Tool, the order will be immediately passed on to the matching engine or rejected back to the entering Member.
The Exchange does not propose to require Members to use the Tool. Members are free to use any appropriate risk-management tool or service. The Exchange will not provide preferential treatment to Members using the Tool.
The Exchange proposes to make the Tool available to its Members upon request. The Exchange believes the Tool will offer the Exchange's Members another option in the efficient risk management of its Members' access to BATS Exchange.
The rule change proposed in this submission is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b) of the Act.
The Exchange does not believe that the proposed rule change imposes any burden on competition.
The Exchange has neither solicited nor received written comments on the proposed rule change.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
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.
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:
* Use the Commission's Internet comment form (
* Send an email to
* Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549.