80 FR 73256 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Administration of Livevol X License Agreements

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 226 (November 24, 2015)

[Federal Register Volume 80, Number 226 (Tuesday, November 24, 2015)]
[Notices]
[Pages 73256-73258]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-29844]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76471; File No. SR-CBOE-2015-102]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change Relating to Administration of Livevol X License 
Agreements

November 18, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on November 13, 2015, Chicago Board Options Exchange, Incorporated 
(the ``Exchange'' or ``CBOE'') filed with the Securities and Exchange 
Commission (the ``Commission'') the proposed rule change as described 
in Items I, II, and III below, which Items have been prepared by the 
Exchange. The Commission is publishing this notice to solicit comments 
on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    CBOE proposes to update the status of CBOE's administration of 
license agreements for Livevol X (``LVX'').

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 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 aspects of such 
statements.

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

1. Purpose
    On August 7, 2015, CBOE Livevol, LLC (formerly CBOE IV, LLC) 
(``CBOE Livevol'') completed its acquisition of certain technology 
assets from the entity formerly known as Livevol, Inc. (``Livevol''), 
including LVX, a front-end order entry and management tool. CBOE had 
previously submitted a rule filing that, among other things, described 
the functionality of LVX and proposed applicable fees, which would 
become operative upon closing of the acquisition of assets from 
Livevol.\3\ In that filing, CBOE stated that it expected CBOE Livevol 
to assume agreements between Livevol and its then-current LVX customers 
at the closing of the acquisitions. CBOE further stated that CBOE 
Livevol intended to prepare a form license agreement for LVX and, no 
later than three months following the closing of the acquisition,\4\ 
ensure each customer executed the form agreement so that all LVX 
customers used the product pursuant to the same terms and 
conditions.\5\
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    \3\ See Securities Exchange Act Release No. 34-75302 (June 25, 
2015), 80 FR 37685 (July 1, 2015) (SR-CBOE-2015-062).
    \4\ November 6, 2015 was the date three months following the 
closing of the acquisition.
    \5\ See supra note 3, at note 16.
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    CBOE has made significant progress over the last three months in 
the complicated process of integrating the acquired Livevol business 
into CBOE's business and is in the process of distributing its form 
license agreement to LVX users. However, as LVX has

[[Page 73257]]

hundreds of users, CBOE believes it needs additional time to collect 
executed versions of this agreement from all these LVX users. At this 
time, CBOE expects to complete this process and ensure all LVX users 
have executed the form (and will thus be using LVX pursuant to the same 
contractual terms and conditions) by January 31, 2016. CBOE notes that 
all LVX users currently pay the same fees for LVX as set forth in the 
CBOE Fees Schedule.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\6\ Specifically, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) \7\ requirements that the rules of 
an exchange be 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 regulating, 
clearing, settling, processing information with respect to, and 
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. 
Additionally, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) \8\ requirement that the rules of 
an exchange not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
    \8\ Id.
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    The Exchange believes the proposed rule change does not 
discriminate among market participants, as CBOE continues to make LVX 
available to all market participants in the same manner, and use of LVX 
continues to be completely voluntary. The LVX functionality available 
to users remains the same. All LVX users pay the same fees for use of 
the product, which are set forth in the CBOE Fees Schedule. CBOE 
expects to license the applications to market participants pursuant to 
the same contractual terms and conditions set forth in the form license 
agreement once all LVX users have executed the form agreement. This 
rule filing has no impact on LVX customers' use of LVX; they may 
continue to use LVX in the same manner. It merely extends the time by 
which CBOE expects to complete the process of receiving executed 
versions of the form agreement from all LVX users. The Exchange notes 
that this rule filing does not amend the Exchange's rules, fees or 
systems.

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

    CBOE 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. This rule filing does not amend 
the Exchange's rules, fees or systems. CBOE continues to make LVX 
available to all market participants in the same manner, and use of LVX 
continues to be completely voluntary. The LVX functionality available 
to users remains the same. All LVX users currently pay the same fees 
for LVX as set forth in the CBOE Fees Schedule. CBOE expects to license 
the applications to market participants pursuant to the same 
contractual terms and conditions set forth in the form license 
agreement once all LVX users have executed the form agreement. This 
rule filing has no impact on LVX customers' use of LVX; they may 
continue to use LVX in the same manner. It merely extends the time by 
which CBOE expects to complete the process of receiving executed 
versions of the form agreement from all LVX users. Market participants 
continue to have the flexibility to use any order entry and management 
technology they choose, including LVX.

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

    The Exchange neither solicited nor received comments on the 
proposed rule change.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \9\ and paragraph (f) of Rule 19b-4 \10\ 
thereunder. 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 will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f).
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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 email to [email protected]. Please include 
File Number SR-CBOE-2015-102 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-CBOE-2015-102. 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 such 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-CBOE-2015-102, and should be 
submitted on or before December 15, 2015.


[[Page 73258]]


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-29844 Filed 11-23-15; 8:45 am]
 BILLING CODE 8011-01-P