
[Federal Register Volume 80, Number 183 (Tuesday, September 22, 2015)]
[Notices]
[Pages 57261-57262]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-23972]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75925; File No. 10-222]


Investors' Exchange, LLC; Notice of Filing of Application, as 
Amended, for Registration as a National Securities Exchange Under 
Section 6 of the Securities Exchange Act of 1934

September 15, 2015.
    On August 21, 2015, Investors' Exchange, LLC (``IEX'') submitted to 
the Securities and Exchange Commission (``Commission'') a Form 1 
application under the Securities Exchange Act of 1934 (``Exchange 
Act''), seeking registration as a national securities exchange under 
Section 6 of the Exchange Act.\1\ On September 9, 2015, IEX submitted 
Amendment No. 1 to its Form 1 application.\2\ IEX's Form 1 application, 
as amended, provides detailed information on how it proposes to satisfy 
the requirements of the Exchange Act.
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    \1\ 15 U.S.C. 78s(f).
    \2\ In Amendment No. 1, IEX submitted updated portions of its 
Form 1 application, including revised exhibits, a revised version of 
the proposed IEX Rule Book, and revised Addenda C-2, C-3, C-4, D-1, 
D-2, F-1, F-2, F-3, F-4, F-5, F-6, F-7, F-8, F-9, F-10, F-11, F-12, 
F-13.
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    The Commission is publishing this notice to solicit comments on 
IEX's Form 1 application, as amended. The Commission will take any 
comments it receives into consideration in making its determination 
about whether to grant IEX's request to register as a national 
securities exchange. The Commission will grant the registration if it 
finds that the requirements of the Exchange Act and the rules and 
regulations thereunder with respect to IEX are satisfied.\3\
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    \3\ See 15 U.S.C. 78s(a). Alternatively, if the Commission does 
not grant the registration, it will institute proceedings to 
determine whether registration should be approved or denied. See 15 
U.S.C. 78s(a)(1)(B).
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    IEX currently operates an alternative trading system (``ATS'') for 
the trading of equity securities. If the Commission approves IEX's 
application to become a national securities exchange, IEX would 
transition trading in each symbol to the exchange and ultimately close 
its ATS. IEX would operate a fully automated electronic book for orders 
to buy or sell securities with a continuous, automated matching 
function. IEX would not have a physical trading floor. Liquidity would 
be derived from orders to buy and orders to sell submitted to IEX 
electronically by its registered broker-dealer members from remote 
locations, as well as from quotes submitted electronically by members 
that chose to register under IEX rules as market makers on IEX and be 
subject to certain specified requirements and obligations. One notable 
feature of IEX's proposed trading rules is the proposed ``Midpoint 
Price Constraint'' price sliding process for non-displayed orders, 
which would prevent non-displayed limit orders from posting at a price 
more aggressive than the midpoint of the national best bid and 
offer.\4\ In addition, IEX is proposing a discretionary peg order type, 
which, if unexecuted upon entry, would post non-displayed and would 
exercise discretion only when IEX does not consider that the national 
best bid or national best offer for a particular security is in the 
process of changing based on a pre-determined set of conditions 
described in IEX's proposed rule.\5\
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    \4\ See proposed IEX Rule 11.190(h)(2). See also Exhibit E to 
IEX's Form 1 submission, at 17. Specifically, a non-displayed order 
on IEX with a limit price more aggressive than the midpoint of the 
NBBO would be priced at the midpoint, and the price would 
automatically be adjusted in response to changes in the NBBO to be 
equal to the less aggressive of the order's limit price or the 
midpoint of the NBBO. See also proposed IEX Rule 11.230(a)(4)(D) 
(concerning the ``Book Recheck'' functionality), and Exhibit E to 
IEX's Form 1 submission, at 19 (describing the ``Book Recheck'' 
functionality).
    \5\ See proposed IEX Rule 11.190(b)(10) (concerning the 
discretionary peg order type) and 11.190(g) (concerning quote 
stability). See also Exhibit E to IEX's Form 1 submission, at 14-15.
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    IEX would be wholly owned by its parent company, IEX Group, Inc. 
(``IEXG''), which would appoint IEX's initial Board of Directors. If 
approved by the Commission, within 90 days after the date of its 
approval to operate as a national securities exchange, IEX would 
undertake a petition process by which members could elect Member 
Representative Directors to the Board, as specified in the proposed 
Amended and Restated Operating Agreement of IEX.\6\
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    \6\ See IEX Amended and Restated Operating Agreement Article 
III, Section 4(g). See also Exhibit J to IEX's Form 1 submission, at 
37.
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    A description of the manner of operation of IEX's proposed system 
can be found in Exhibit E to IEX's Form 1 application. The proposed 
rulebook for the proposed IEX exchange can be found in Exhibit B to 
IEX's Form 1 application, and the governing documents for both IEX and 
IEXG can be found in Exhibits A and C, respectively. A listing of the 
officers and directors of IEX can be found in Exhibit J to IEX's Form 1 
application. IEX's Form 1 application, as amended, including all of the 
Exhibits referenced above, is available online at www.sec.gov/rules/other.shtml as well as at the Commission's Public Reference Room.
    Interested persons are invited to submit written data, views, and 
arguments concerning IEX's Form 1, as amended, including whether the 
application is consistent with the Exchange 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 rule-comments@sec.gov. Please include 
File Number 10-222 on the subject line.

[[Page 57262]]

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 10-222. 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/other.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to IEX's Form 1 filed with the Commission, and 
all written communications relating to the application 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. 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 publicly available. All 
submissions should refer to File Number 10-222 and should be submitted 
on or before November 6, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(71)(i).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-23972 Filed 9-21-15; 8:45 am]
BILLING CODE 8011-01-P


