E9-21711. Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Amending Certain Provisions of Exchange Rule 1600 To Align the Rule With the ...

September 3, 2009.

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 August 12, 2009, New York Stock Exchange LLC (“NYSE” or the “Exchange”) 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 Exchange has designated the proposed rule change “non-controversial” and eligible for immediate effectiveness pursuant to Section 19(b)(3)(A)(iii) of the Act ^[4] and Rule 19b-4(f)(6) thereunder.^[5] On September 1, 2009, the Exchange filed Amendment No. 1.^[6] 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

The Exchange proposes to amend certain provisions of Exchange Rule 1600 (New York Block Exchange^[SM] ) (“NYBX^[SM] ” or the “facility”) to align the Rule with the technology and functionality of the NYBX facility in relation to an NYBX order's ability to interact with non-displayed contra side liquidity in the NYSE Display Book® (“Display Book” or “DBK”) and to clarify the processing of NYBX orders that have an optional, user-defined Minimum Triggering Volume (“MTV”). The proposed amendment also includes clarifying language, additional definitions of terms found in Regulation NMS ^[7] and adds technical changes to correct the numbering of certain subsections. This Amendment No. 1 of SR-NYSE-2009-82 replaces the previous filing in its entirety. The text of the proposed rule change is available at the Exchange, the Commission's Public Reference Room, and http://www.nyse.com.

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

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 the Statutory Basis for, the Proposed Rule Change

1. Purpose

The NYBX is an electronic facility of the Exchange that provides continuous execution of all NYBX orders in NYSE-listed securities with the aggregate of all orders in the NYBX facility and displayed and non-displayed orders in the DBK. Orders entered into the NYBX facility are non-displayed orders. NYBX orders may be subject to certain conditions that can affect their ability to be executed. One type of condition is a minimum size desired for execution, known as the MTV. Executions on the NYBX will not trade through a protected quotation of an automated trading center.

The Exchange seeks to amend Exchange Rule 1600 to clarify the functionality of the NYBX facility in relation to an NYBX order's ability to execute with aggregated non-displayed contra side liquidity in the DBK. An automated market data feed into the NYBX facility enables the facility to read non-displayed liquidity in the DBK (“hidden data feed”) and triggers the routing of NYBX orders to the DBK whenever the MTV can be met by the aggregate of displayed and non-displayed contra side liquidity as described in subsection (c)(3)(B)(ii)(I) of Rule 1600 (“MTV Calculations”). It is important to note that unless the NYBX order's MTV can be met, an NYBX order will not attempt to execute with available contra side liquidity.

In addition to the non-displayed liquidity of reserve orders ^[8] entered on the NYSE, the non-displayed liquidity in the DBK includes the Designated Market Maker's (“DMM”) Capital Commitment Schedule (“CCS”).^[9] CCS is a liquidity schedule established at various price points at which the DMM is willing to interact with incoming contra side orders and possibly provide price improvement to orders in the DBK, including NYBX orders that are routed to the DBK. DMMs commit this predetermined CCS interest through a DMM algorithm.

Because the hidden data feed cannot read the CCS interest in the DMMs' algorithms, CCS interest is not considered in the MTV calculation. Nevertheless, when the MTV is otherwise met, CCS interest may attempt to execute with NYBX orders when they enter the DBK at any price point. CCS interest may attempt to execute with an NYBX order each time the order, whether the originating order or a residual order, is routed from the NYBX facility to the DBK. The interaction of NYBX orders with DBK contra side liquidity and available contra side CCS interest is discussed more fully below (see also Example Nos. 1A and 4).

To enable an NYBX order to execute with non-displayed liquidity in the DBK, the NYBX facility has been configured to automatically over-size NYBX orders that are routed from the facility to the DBK, thereby allowing such orders to attempt to execute with available contra side displayed and non-displayed liquidity in the DBK and with available contra side CCS interest. “Over-sizing” is an automated function whereby the NYBX facility sends the entire NYBX order to the DBK. This occurs when the MTV is met and the DBK has available contra side liquidity and there is no better priced contra side liquidity in the NYBX facility.

The amendment will also clarify that an unrestricted MTV calculation, as described in subsection (c)(3)(B)(ii)(I) of Rule 1600 (“MTV Calculations”), will not include the available contra side liquidity in automated trading centers unless the execution of the NYBX order may potentially trade through a protected quotation in the NYBX facility or in the DBK. Therefore, even if a customer designated an NYBX order with an unrestricted MTV, the facility will not consider available contra side liquidity in other automated trading centers when calculating the MTV unless the execution of that order may potentially trade through a protected quotation.

NYBX Compliance With Regulation NMS

NYBX orders will not trade through a Protected Bid or Protected Offer except as allowed by Rule 611 of Regulation NMS. If the execution of an NYBX order may potentially trade through an automated trading center, the NYBX facility will immediately send routing instructions to the NYSE Routing Broker ^[10] (“Routing Broker”) and the Routing Broker will immediately route the applicable volume (e.g., the price and size of the displayed quotation) to the automated trading center to attempt to execute with applicable protected quotations. If the order is larger than the amount routed to the automated trading center, the portion of the NYBX order that was not routed to the automated trading center is sent to the DBK to attempt to execute with displayed and non-displayed contra side liquidity in the DBK and with available contra side CCS interest. The routing of orders from the NYBX facility to automated trading centers, via the Routing Broker, occurs almost simultaneously with the sending of orders to the DBK or executions of orders in the NYBX facility.

Also, when there is a potential trade through of a protected quotation and the applicable portion of an NYBX order is routed to the automated trading center in compliance with Regulation NMS, the NYBX facility will not provide price improvement, as a delay in routing may cause an inadvertent trade through of protected quotations should the quotations change in the meantime.

NYBX Order Execution Sequence

NYBX orders will first attempt to execute against all available contra side liquidity in the DBK (displayed and non-displayed) and with any available contra side CCS interest at a price that is equal to or better than the limit price of the NYBX order. The NYBX order will be oversized and routed to the DBK at a price equal to: (a) The best price of contra side liquidity available in the NYBX Facility, or (b) the best price of contra side liquidity available in the DBK, whichever price is superior, and attempt to execute in the DBK until the order is exhausted or until the available contra side liquidity in the DBK is exhausted.

However, when the NYBX facility has available contra side liquidity at a price at or within the NBBO and at a price that is better than all displayed and non-displayed liquidity in the DBK, or when there is no displayed or non-displayed contra side liquidity in the DBK, the order will attempt to execute in the NYBX facility at such price until the order is exhausted or until the available contra side liquidity in the facility is exhausted or until the order is cancelled or until the order reaches a price point that is available in the DBK.

As described in more detail above, the execution of NYBX orders will comply with Regulation NMS.

In each of the aforementioned trading situations, if the order at a particular price point is not exhausted in the DBK, the residual order will be sent back to the NYBX facility where it will attempt to execute with available contra side liquidity in the DBK, the NYBX facility, and the protected quotations of other automated trading centers, in the same sequence described above, until the order is exhausted or until the available contra side liquidity is exhausted or until the order is cancelled.

Examples:

The following examples will demonstrate how NYBX orders are processed.

NYBX Snapshot

NYBX: (Sell Orders)

500 shares @ $19.99.

500 shares @ $20.00.

500 shares @ $20.01.

500 shares @ $20.04.

PHLX: (Sell Orders)

400 shares @ $20.00 (NBBO).

DBK: (Sell Orders)

Displayed:

600 shares @ $20.00.

300 shares @ $20.01.

300 shares @ $20.05.

Non-Displayed: (Sell orders)

500 shares @ $19.99.

500 Shares @ $20.00.

Example No. 1:

A buy limit order of 2,500 shares at $20.00, with an unrestricted MTV of 2,500 shares, enters the NYBX facility. The MTV of 2,500 shares is met by the aggregate of orders in the NYBX facility and the DBK at $19.99 (500 + 500) and @ $20.00 (500 + 600 + 500) adding up to 2,600 shares. Orders in PHLX were not necessary to meet the MTV.

The NYBX facility routes and executes the order in the following sequence:

 

—Route 2,500 shares to DBK @ $19.99, execute 500 shares leaving 2,000 shares.

—Execute 500 shares in NYBX @ $19.99 leaving 1,500 shares.

—Route 1,500 shares to DBK @ $20.00, execute 1,100 shares leaving 400 shares.

—Execute 400 shares in NYBX @ $20.00 thereby exhausting the order.

As the example shows, orders will first attempt to execute with contra side liquidity in the DBK when the price is equal to or better than the price in the NYBX. When the NYBX facility has available contra side liquidity at a price within the NBBO and at a price that is better than all liquidity in the DBK, or when there is no available contra side liquidity in the DBK, the order will attempt to execute in the NYBX facility at that price.

Example No. 1A:

Using the same scenario in Example No. 1 above, a buy limit order of 2,500 shares @ $20.00, with an unrestricted MTV of 2,500 shares, enters the NYBX facility. The NYBX facility routes and executes the order in the following sequence:

 

—Route 2,500 shares to DBK @ $19.99, execute 500 shares leaving 2,000 shares.

—Upon presentation of the order in the DBK, the DMM Capital Commitment Schedule algorithm (“CCS”) determines to execute 1,000 additional shares @ $19.99 leaving 1,000 shares.

—Execute 500 shares in NYBX @ $19.99 leaving 500 shares.

—Route 500 shares to DBK @ $20.00, execute 500 shares in DBK thereby exhausting the order.

As the example shows, when NYBX orders are routed to the DBK, such NYBX orders will have an opportunity to attempt to execute with CCS interest. If a residual NYBX order remains after partial execution in the DBK at a particular price point, the residual order will be sent back to the NYBX facility for further execution in the NYBX facility, the DBK or with protected quotations of automated trading centers. Thus, if the DBK acquires additional contra side liquidity, displayed or non-displayed, that is eligible for execution against the NYBX order, the NYBX facility will route the residual order to the DBK. This NYBX residual order, for all intents and purposes, appears as a new order to the DBK, and such NYBX order will have another opportunity to attempt to execute with available contra side liquidity in the DBK and with available contra side CCS interest. Therefore, each time an NYBX order, original or residual, is routed to the DBK at a particular price point, such order will have an opportunity to attempt to execute with displayed and non-displayed contra side liquidity in the DBK and with available contra side CCS interest.

Example No. 2:

A buy limit order for 3,000 shares @ $20.00, with an unrestricted MTV of 3,000 shares, enters the NYBX. The MTV is not met because the aggregate of available contra side liquidity in the DBK and in the NYBX only adds up to 2,600 shares (1,000 @ $19.99 and 1,600 at $20.00). Because there will be no trade through at the PHLX in this example, the 400 PHLX shares will not be counted in the MTV calculation. Therefore, the MTV is not met and because the MTV is not met, there will be no execution of the NYBX order.

Example No. 3:

A buy limit order for 3,500 shares @ $20.01, with an unrestricted MTV of 3,500 shares, enters the NYBX facility. In this example, the MTV is met by the aggregate liquidity at $19.99, $20.00 and $20.01 on the DBK, the NYBX and the PHLX (1000 + 2000 + 800 = 3,800). The NYBX routes and executes the order in the following sequence:

 

—Route 400 shares to PHLX @ $20.00, execute 400 shares leaving 3,100 shares.

—Route 3,100 shares to DBK @ $19.99, execute 500 shares leaving 2,600 shares.

—Execute 500 shares in NYBX @ $19.99 leaving 2,100 shares.

—Route 2,100 shares to DBK @ $20.00, execute 1,100 shares leaving 1,000 shares.

—Execute 500 shares in NYBX @ $20.00 leaving 500 shares.

—Route 500 shares to DBK @ $20.01, execute 300 shares leaving 200 shares.

—Execute 200 shares in NYBX @ $20.01 thereby exhausting the order.

The liquidity in the PHLX is included in the MTV calculation because, as the example demonstrates, the execution of the order may potentially trade through the protected quotations. The NYBX facility is programmed to route the applicable volume to automated trading centers whenever one or more successive price points of NYBX and DBK contra side liquidity, included in the MTV calculation, are inferior to prices of protected quotations in the automated trading center(s), thereby avoiding a potential trade through of any protected quotations. The NYBX snapshot of the entire market enables the NYBX facility to determine if there is a potential trade through of a protected quotation, and if so, the facility immediately routes the applicable shares to the automated trading center(s) in compliance with Regulation NMS. This is done even if the price of the shares routed to the automated trading center(s) is inferior to other successive price points in the NYBX facility and in the DBK. As discussed above, the facility will not wait for price improvement opportunities when routing out shares in compliance with Regulation NMS as any routing delay may cause an inadvertent trade through of protected quotations.

In Example No. 3 the NYBX routed 400 shares to the PHLX at $20.00 to comply with Regulation NMS. This routing to PHLX occurred almost simultaneously with the routing of 3,100 shares to DBK at $19.99, executing 500 shares and leaving 2,600 shares. As the order sequencing in Example No. 3 demonstrates, the remaining 2,600 shares then executes with all better priced contra side liquidity in the DBK and the NYBX facility. This example also demonstrates how the NYBX facility attempts to execute available contra side liquidity at each successive price point in the DBK and in the NYBX facility (i.e., “walking the book”).

Example No. 3A:

In the same example as Example No. 3 above, if the MTV calculation was “restricted” to include only the available contra side liquidity in the DBK and the NYBX and not contra side liquidity in the PHLX (1000 + 1600 + 800 = 3,400), the MTV would not be met and the order would not be executed.

Example No. 4:

A buy limit order of 4,500 shares @ $20.05, with no MTV, enters the NYBX facility. The NYBX routes and executes the order in the following sequence:

 

—Route 400 shares to PHLX @ $20.00, execute 400 shares leaving 4,100 shares.

—Route 4,100 shares to DBK @ $19.99, execute 500 shares leaving 3,600 shares.

—Execute 500 shares in NYBX @ $19.99 leaving 3,100 shares.

—Route 3,100 shares to DBK @ $20.00, execute 1,100 shares leaving 2,000 shares.

—Execute 500 shares in NYBX @ $20.00 leaving 1,500 shares.

—Route 1,500 shares to DBK @ $20.01, execute 300 shares leaving 1,200 shares.

—Execute 500 shares in NYBX @ $20.01 leaving 700 shares.

—Route 700 shares to DBK @ $20.04, execute 0 leaving 700 shares.

—Execute 500 shares in NYBX @ $20.04 leaving 200 shares.

—Route 200 shares to DBK @ $20.05, execute 200 shares thereby exhausting the order.

As explained earlier in Example No. 3, when there is a potential trade through of a protected quotation, the facility immediately routes the applicable volume to the automated trading center(s) in compliance with Regulation NMS. In Example No. 4 the NYBX routed 400 shares to the PHLX at $20.00 to comply with Regulation NMS. This routing to PHLX occurred almost simultaneously with the routing of 4,100 shares to DBK at $19.99, executing 500 shares and leaving 3,600 shares. The facility does not provide price improvement to the shares that are routed to the automated trading center(s) as latency and interaction with hidden CCS interest could compromise the facility's ability to comply with Regulation NMS.

As Example No. 4 demonstrates, provided the MTV of the order is met, the NYBX facility is programmed to route orders to the DBK and attempt to execute with available contra side liquidity in the DBK even if an order's limit price is not matched in the DBK's displayed or non-displayed contra side liquidity. Also, provided the MTV is met, the NYBX facility will route orders to the DBK and attempt to execute with better priced available contra side liquidity in the DBK, which will include an opportunity to execute with CCS interest. This occurs in Example No. 4 when the NYBX facility routes 700 shares at $20.04 to the DBK even though the DBK does not have contra side liquidity priced at $20.04, but has such liquidity priced at $20.05. When the facility routes 700 shares at $20.04 to the DBK, the order has an opportunity to execute with CCS interest, but no shares are executed at that price. Then the 700 shares are sent back to the NYBX facility to attempt to execute against the 500 shares in the NYBX at $20.04. The 700 shares then execute against the 500 shares at $20.04 leaving 200 shares. Because the DBK has 300 shares of contra side liquidity at $20.05, the NYBX facility then sends the residual order consisting of 200 shares at $20.05 back to the DBK where it executes against the 300 shares at $20.05 thereby exhausting the NYBX order and leaving 100 shares at $20.05 in the DBK. As the example also demonstrates, the NYBX facility is programmed to attempt to execute orders at each successive price point available in the NYBX facility and in the DBK.

The proposed amendment adds definitions of terms in subsection (b)(2) (Definitions), which are defined in Regulation NMS and corrects the numbering of provisions in subsection (h) (Limitations on the Use of the New York Block Exchange).

The proposed amendment also clarifies the manner in which the NYBX orders are processed and how such orders interact with the DBK, including interaction with available contra side CCS interest. Additionally, the proposed amendment clarifies that the MTV calculation does not include the protected quotations in the automated trading centers unless the execution of the NYBX order may potentially trade through a protected quotation.

2. Statutory Basis

The basis under the Act ^[11] for this proposed rule change is the requirement under Section 6(b)(5) ^[12] that an Exchange have rules that 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 and, in general, to protect investors and the public interest. The proposed amendment aligns the Rule with the technology and functionality of the NYBX facility in relation to an NYBX order's ability to attempt to execute with contra side liquidity in the DBK and with the DMM's CCS interest. The amendment also clarifies that the unrestricted MTV calculation will not include the available contra side liquidity in the automated trading centers unless the execution of the NYBX order may otherwise trade through a protected quotation in the NYBX facility or in the DBK. Additionally, the amendment clarifies how NYBX orders are processed and at what price point orders are routed from the NYBX facility to the DBK and attempt to execute in the DBK. The proposed amendment adds definitions of terms in subsection (b)(2) (Definitions), which are defined in Regulation NMS. Therefore, the Exchange believes that because the proposed amendment will clarify how the NYBX facility operates, investors and the public interest will be best served as the amendment will provide transparency of the facility's functionality for all users.

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

Because the 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 prior to 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act ^[13] and Rule 19b-4(f)(6) thereunder.^[14]

A proposed rule change filed under Rule 19b-4(f)(6) ^[15] normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b-4(f)(6)(iii),^[16] the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Exchange believes the waiver of this period will allow it to align Rule 1600 with the technology and functionality of the NYBX facility as it currently operates, providing greater transparency and certainty to market participants. The Exchange also asserts that waiving the operative delay will enable its customers to better manage their order flow and make strategic trading decisions.

The Commission has determined that waiving the 30-day operative delay of the Exchange's proposal is consistent with the protection of investors and the public interest because such waiver will allow the Exchange to promptly conform its rules to manner in which the NYBX Facility currently operates.^[17] Therefore, the Commission designates the proposal as operative upon filing. At any time within 60 days of the filing of the proposed rule change, the Commission may summarily abrogate 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.^[18]

IV. Solicitation of Comments

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

• Use the Commission's Internet comment form (http://www.sec.gov/​rules/​sro.shtml); or
• Send an e-mail to [e-mail]. Please include File Number SR-NYSE-2009-82 on the subject line.

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-NYSE-2009-82. This file number should be included on the subject line if e-mail 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 inspection and copying in the Commission's Public Reference Section, 100 F Street, NE., Washington, DC 20549-1090. Copies of the filing will also be available for inspection and copying at the NYSE's principal office and on its Internet Web site at http://www.nyse.com. 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-NYSE-2009-82 and should be submitted on or before October 1, 2009.

For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.^[19]

Florence E. Harmon,

Deputy Secretary.

Footnotes

1.  15 U.S.C. 78s(b)(1).

2.  15 U.S.C. 78a.

3.  17 CFR 240.19b-4.

4.  15 U.S.C. 78s(b)(3)(A)(iii).

5.  17 CFR 240.19b-4(f)(6).

6.  Amendment No. 1 added clarifying language to the proposed rule text and made corresponding changes to the proposal.

7.  The terms “protected quotations” and “trade through” have the same meaning as defined in Rule 600 of Regulation NMS. These terms have been added to the definition section of Rule 1600 in the proposed amendment (see proposed subsections (b)(2)(F) and (b)(2)(I)). The proposed rule change does not impact the facility's consideration of all protected quotations of automated trading centers.

8.  See NYSE Rule 13 for a definition of “reserve orders.”

9.  See Securities Exchange Act Release No. 58845 (October 24, 2008) 73 FR 64379 (October 29, 2008) (SR-NYSE-2008-46) (“The New Market Model”). Specifically, see NYSE Rule 1000(d)(i).

10.  See NYSE Rule 17(c) (“Operation of Routing Broker”). As per Rule 17(c), the NYBX facility will use the Routing Broker to send NYBX orders to the DBK and to automated trading centers pursuant to Regulation NMS when attempting to execute such orders.

11.  15 U.S.C. 78a et seq.

12.  15 U.S.C. 78f(b)(5).

13.  15 U.S.C. 78s(b)(3)(A).

14.  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. NYSE has satisfied this requirement.

15.  17 CFR 240.19b-4(f)(6).

16.  17 CFR 240.19b-4(f)(6)(iii).

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

18.  For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change under Section 19(b)(3)(C) of the Act, the Commission considers the period to commence on September 1, 2009, the date on which NYSE submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C).

19.  17 CFR 200.30-3(a)(12).