N.Y. Attorney General Examining Dark Pools

On June 4th, Reuters discussed the New York State Attorney General’s investigation into the relationships between high-frequency traders and dark pools. Relationships.

Chicago Board Options Exchange

Disapproval Proceedings Instituted Regarding Proposed Changes for Complex Orders.

On June 5th, the SEC instituted proceedings to determine whether to approve or disapprove the Chicago Board Options Exchange’s proposed rule change to require all complex orders with three or more legs to be subject to a complex order auction prior to entering the complex order book. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of June 9. Rebuttal comments should be submitted within 35 days after publication. SEC Release No. 34-72329.

Guidance on Trading Permit Holder Give Up Procedures Proposed

On June 5th, the SEC provided notice of the Chicago Board Options Exchange’s filing of a proposal to augment its requirements in CBOE Rules 6.21 and 6.50 related to the give up of a Clearing Trading Permit Holder by a Trading Permit Holder on Exchange transactions. The proposal would address and provide additional detail regarding the give up process. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of June 9. SEC Release No. 34-72325.

Extension of End-of-Month Pricing Procedures Proposed

On May 30th, the SEC provided notice of the Chicago Board Options Exchange’s filing of proposed changes to Interpretation and Policy .06 to Rule 6.2B to extend its S&P 500 Index (“SPX”) end-of-month pricing procedures to series of SPX options on the Hybrid Trading System. Comments should be submitted on or before June 26, 2014. SEC Release No. 34-72284.

The Depository Trust Company

Changes to Settlement Service Guide Proposed

On May 30th, the SEC provided notice of The Depository Trust Company’s filing of proposed changes to the DTC Settlement Service Guide to modify the Receiver Authorized Delivery functionality to reduce the intraday uncertainty that may arise from reclaim transactions linked to Deliver Orders and Payment Orders and any potential credit and liquidity risk from such reclaims. Comments should be submitted on or before June 26, 2014. SEC Release No. 34-72283.

Financial Industry Regulatory Authority

Longer Period Designated to Consider CRD Expungement Proposal

On June 5th, the SEC designated July 22, 2014 as the date by which it will approve, disapprove, or institute disapproval proceedings regarding the Financial Industry Regulatory Authority’s proposed adoption of FINRA Rule 2081. This rule prohibits member firms and associated persons from conditioning settlement of a customer dispute on the customer’s agreement to expungement the dispute information from the Central Registration Depository. SEC Release No. 34-72332.

Disapproval Proceedings Instituted Regarding Arbitration Proposal

On June 3rd, Investment News reported the full SEC will consider the Financial Industry Regulatory Authority’s proposed amendment of Rule 12104 of the Customer Code and Rule 13104 of the Industry Code to broaden arbitrators’ authority to make referrals during an arbitration proceeding. Comments on FINRA’s proposal should be submitted to the SEC on or before June 26, 2014. Rebuttal comments should be submitted on or before July 11, 2014. SEC Release No. 34-72196.

Lighting Dark Pools

On June 2nd, FINRA announced it has begun to make available to the public data indicating the activity levels in each alternative trading system, including the market known as “dark pools.” FINRA Press Release.

ATS Data Fees Approved

On May 29th, the SEC approved FINRA’s proposed adoption of FINRA Rule 4553 (Fees for ATS Data), which establishes a fee schedule for alternative trading system volume information published on the FINRA website. SEC Release No. 34-72280.

ICE Clear Europe

End of Day Pricing Changes Proposed

On June 4th, the SEC provided notice of ICE Clear Credit’s filing of proposed revisions to its end of day pricing policies. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of June 9. SEC Release No. 34-72306.

Investment Loss Provisions Proposed

On June 2nd, the SEC provided notice of ICE Clear Europe’s filing of proposed new provisions relating to certain investment losses on margin and guaranty fund contributions provided by clearing members as well as other losses to the clearing house arising other than from a clearing member default, including losses from general business risk and operational risk. The amendments would (i) require ICE Clear Europe to apply a specified amount of its own assets to cover non-default losses and investment losses and (ii) require clearing members in all product categories to make contributions to cover investment losses (but not other non-default losses) that exceed the available clearing house loss assets. The proposed rules would also limit the clearing house’s liability for losses arising from a failure of a bank or similar custodian. Comments should be submitted on or before June 27, 2014. SEC Release No. 34-72297.

NASDAQ OMX Group

Longer Period Designated for Consideration of Data Feed Fee Proposal

The SEC has designated July 25, 2014 as the date by which it will approve, disapprove, or institute disapproval proceedings regarding the NASDAQ Stock Market’s proposed rule change. The rule in question would remove, from the Exchange rules, fee provisions with respect to third-party data feeds that Nasdaq receives from multiple sources and then re-transmits to clients in connection with the Exchange’s co-location services. SEC Release No. 34-72328.

Change Proposed to Services Offered

On June 4th, the SEC provided notice of NASDAQ Stock Market’s filing of proposed amendments to IM-5900-7 to modify the services offered to certain newly listing companies. Comments should be submitted within 21 days after publication in the Federal Register, which is expected during the week of June 9. SEC Release No. 34-72311.

National Futures Association

NFA to Reduce Assessment Fees

On June 5th, the National Futures Association announced that its Board of Directors has approved a reduction in the assessment fees it levies on futures contracts and options on futures contracts traded on behalf of public customers from $.02 to $.01 per side (futures and options on futures contracts). Assuming the proposal is approved by the CFTC, the reduction will become effective on October 1, 2014. NFA Press Release.

Changes to the CPO Form PQR and CTA Form PR

On June 5th, the National Futures Association advised commodity pool operators (“CPO”) and commodity trading advisors (“CTA”) of slight changes to the CPO Form PQR and CTA Form PR. These changes will become effective for the quarter ending June 30, 2014. NFA Notice I-14-13.

Options Clearing Corporation

Extension of Letters of Credit Concentration Limits Proposed

On June 2nd, the SEC provided notice of the Options Clearing Corporation’s filing of a proposed rule change to make its policy concerning concentrated margin deposits of certain issuers of letters of credit (“LC”) applicable to all LC issuers. Comments should be submitted on or before June 27, 2014. SEC Release No. 34-72294.