81 FR 36637 - Self-Regulatory Organizations; CBOE Futures Exchange, LLC; Notice of Proposed Rule Change Regarding the Reporting Time for Exchange of Contract for Related Position Transactions and Block Trades That Involve Trade at Settlement Transactions
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 109 (June 7, 2016)
Federal Register Volume 81, Issue 109 (June 7, 2016)
| Page Range | 36637-36638 | |
| FR Document | 2016-13312 |
[Federal Register Volume 81, Number 109 (Tuesday, June 7, 2016)] [Notices] [Pages 36637-36638] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-13312] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-77956; File No. SR-CFE-2016-001] Self-Regulatory Organizations; CBOE Futures Exchange, LLC; Notice of Proposed Rule Change Regarding the Reporting Time for Exchange of Contract for Related Position Transactions and Block Trades That Involve Trade at Settlement Transactions June 1, 2016. Pursuant to Section 19(b)(7) of the Securities Exchange Act of 1934 (``Act''),\1\ notice is hereby given that on May 12, 2016 CBOE Futures Exchange, LLC (``CFE'' or ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``Commission'') the proposed rule change described in Items I, II, and III below, which Items have been prepared by CFE. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. CFE also has filed this proposed rule change with the Commodity Futures Trading Commission (``CFTC''). CFE filed a written certification with the CFTC under Section 5c(c) of the Commodity Exchange Act (``CEA'') \2\ on May 12, 2016. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(7). \2\ 7 U.S.C. 7a-2(c). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Description of the Proposed Rule Change CFE Rule 404A (Trade at Settlement Transactions) defines a TAS transaction as a transaction in a CFE contract at a price equal to the daily settlement price, or a specified differential above or below the daily settlement price, for the contract on a trading day. The actual amount is determined subsequent to the transaction based upon the daily settlement price of the contract. CFE is submitting this amendment in conjunction with CFE's submission of a separate rule certification to the CFTC to change the end of trading hours for TAS transactions in CBOE Volatility Index (``VX'') futures from three minutes prior to the close of regular trading hours at the end of a business day to two minutes prior to the close of regular trading hours at the end of a business day.\3\ This change to TAS trading hours in VX futures means that the trading hours for TAS transactions in VX futures will end at 3:13 p.m.\4\ instead of 3:12 p.m. --------------------------------------------------------------------------- \3\ See CFE Rule Certification Submission Number CFE-2016-006 submitted to the CFTC on May 12, 2016. \4\ All times referenced are Chicago time. --------------------------------------------------------------------------- CFE currently permits TAS transactions only in VX futures. Extending the TAS trading hours in VX futures by one minute will provide market participants that engage in TAS transactions toward the end of TAS trading hours a better sense of the likely daily settlement price and how many contracts need to be traded utilizing TAS transactions in order to execute hedging and roll strategies. As a result of the change in TAS trading hours described above, the Exchange proposes a corollary change to amend its rules related to the reporting time for Exchange of Contract for Related Position (``ECRP'') transactions and Block Trades that involve TAS transactions. The scope of this filing is limited solely to the application of the rule amendments to security futures that may be traded on CFE. The text of the proposed rule change is attached as Exhibit 4 to the filing but is not attached to the publication of this notice. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, CFE 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. CFE 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 As previously mentioned, he Exchange has submitted a rule filing certification to the CFTC to extend the trading hours for TAS transactions in VX futures from 3:12 p.m. to 3:13 p.m. As such, the Exchange is proposing to amend CFE Rules 414 and 415, which set forth the reporting requirements for ECRP transactions and Block Trades that involve TAS transactions, in order to align the reporting time frames with the revised trading hours for VX TAS transactions. Although the revisions to these reporting time frames are being made as a result of the change in trading hours for VX TAS transactions, the revised reporting time frames in the [[Page 36638]] proposed rule change would apply to any product listed on CFE, including a security future, in the event that CFE were to amend its rules to permit TAS transactions in that product. Reporting Time Frame for ECRP Transactions That Involve TAS Transactions Paragraph (i) of CFE Rule 414 (Exchange of Contract for Related Position) currently provides (i) that the CFE legs of TAS ECRP transactions which are reported to CFE after 3:12 p.m. Monday through Thursday will be submitted for clearing for the next business day and (ii) that TAS ECRP transactions may not be reported after 3:12 p.m. on Friday. The proposed rule change changes the references in Rule 414(i) from 3:12 p.m. to 3:13 p.m. to be consistent with the change in TAS trading hours. CFE believes this extension is justified because it will allow CFE to align its ECRP transaction reporting requirements with the revised trading hours for VX TAS transactions. Reporting Time Frame for Block Trades That Involve TAS Transactions Paragraph (g) of CFE Rule 415 (Block Trades) currently provides (i) that TAS Block Trades which are reported to CFE after 3:12 p.m. Monday through Thursday will be submitted for clearing for the next business day and (ii) that TAS Block Trades may not be reported after 3:12 p.m. on Friday. The proposed rule change changes the references in Rule 415(g) from 3:12 p.m. to 3:13 p.m. to be consistent with the change in TAS trading hours. CFE believes this extension is justified because it will allow CFE to align its Block Trade reporting requirements with the revised trading hours for VX TAS transactions. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,\5\ in general, and furthers the objectives of Sections 6(b)(5) \6\ and 6(b)(7) \7\ in particular in that it is designed: --------------------------------------------------------------------------- \5\ 15 U.S.C. 78f(b). \6\ 15 U.S.C. 78f(b)(5). \7\ 15 U.S.C. 78f(b)(7). ---------------------------------------------------------------------------To foster coordination of the Exchange's reporting provisions relating to TAS ECRP and Block Trades with the revised trading hours for VX TAS transactions; and 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 Exchange believes that the proposed rule change would benefit market participants because it would provide them with additional time to report ECRP transactions and Block Trades that involve TAS transactions that market participants wish to have cleared on the same business day as the calendar day of the transaction to align with the revised trading hours for TAS transactions in VX futures. In addition, the proposed rule change benefits market participants by allowing the reporting of ECRP transactions and Block Trades that involve TAS transactions on Fridays to be done during the entire time period that TAS transactions in VX futures are permitted in order to be consistent with the change in TAS trading hours for VX futures. B. Self-Regulatory Organization's Statement on Burden on Competition CFE does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. Specifically, the Exchange believes that the proposed rule change will not burden competition because the new reporting time provisions for ECRP transactions and Block Trades that involve TAS transactions will align with the revised trading hours for VX TAS transactions and will apply to equally all market participants. 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 The proposed rule change will become effective on or after May 26, 2016, on a date to be announced by the Exchange through the issuance of a circular. At any time within 60 days of the date of effectiveness of the proposed rule change, the Commission, after consultation with the CFTC, may summarily abrogate the proposed rule change and require that the proposed rule change be refiled in accordance with the provisions of Section 19(b)(1) of the Act.\8\ --------------------------------------------------------------------------- \8\ 15 U.S.C. 78s(b)(1). --------------------------------------------------------------------------- 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 rule-comments@sec.gov. Please include File Number SR-CFE-2016-001 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-CFE-2016-001. 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-CFE-2016-001, and should be submitted on or before June 28, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\9\ --------------------------------------------------------------------------- \9\ 17 CFR 200.30-3(a)(73). --------------------------------------------------------------------------- Brent J. Fields, Secretary. [FR Doc. 2016-13312 Filed 6-6-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 109 / Tuesday, June 7, 2016 / Notices 36637
(‘‘Commission’’) is soliciting comments SECURITIES AND EXCHANGE futures will end at 3:13 p.m.4 instead of
on the collection of information COMMISSION 3:12 p.m.
summarized below. The Commission CFE currently permits TAS
plans to submit this existing collection [Release No. 34–77956; File No. SR–CFE– transactions only in VX futures.
of information to the Office of 2016–001] Extending the TAS trading hours in VX
Management and Budget for extension futures by one minute will provide
and approval. Self-Regulatory Organizations; CBOE market participants that engage in TAS
Futures Exchange, LLC; Notice of transactions toward the end of TAS
Rules 7a–15 through 7a–37 (17 CFR trading hours a better sense of the likely
Proposed Rule Change Regarding the
260.7a–15–260.7a–37) under the Trust Reporting Time for Exchange of daily settlement price and how many
Indenture Act of 1939 (15 U.S.C. 77aaa Contract for Related Position contracts need to be traded utilizing
et seq.) set forth the general Transactions and Block Trades That TAS transactions in order to execute
requirements as to form and content of Involve Trade at Settlement hedging and roll strategies.
applications, statements and reports that Transactions As a result of the change in TAS
must be filed under the Trust Indenture trading hours described above, the
Act. The respondents are persons and June 1, 2016. Exchange proposes a corollary change to
entities subject to requirements of the Pursuant to Section 19(b)(7) of the amend its rules related to the reporting
Trust Indenture Act. Trust Indenture Securities Exchange Act of 1934 time for Exchange of Contract for
Act Rules 7a–15 through 7a–37 are (‘‘Act’’),1 notice is hereby given that on Related Position (‘‘ECRP’’) transactions
disclosure guidelines and do not May 12, 2016 CBOE Futures Exchange, and Block Trades that involve TAS
directly result in any collection of LLC (‘‘CFE’’ or ‘‘Exchange’’) filed with transactions. The scope of this filing is
information. The rules are assigned only the Securities and Exchange limited solely to the application of the
one burden hour for administrative Commission (‘‘SEC’’ or ‘‘Commission’’) rule amendments to security futures that
convenience. the proposed rule change described in may be traded on CFE. The text of the
Items I, II, and III below, which Items proposed rule change is attached as
Written comments are invited on: (a) have been prepared by CFE. The Exhibit 4 to the filing but is not attached
Whether this proposed collection of Commission is publishing this notice to to the publication of this notice.
information is necessary for the proper solicit comments on the proposed rule
performance of the functions of the change from interested persons. CFE II. Self-Regulatory Organization’s
agency, including whether the also has filed this proposed rule change Statement of the Purpose of, and
information will have practical utility; with the Commodity Futures Trading Statutory Basis for, the Proposed Rule
(b) the accuracy of the agency’s estimate Commission (‘‘CFTC’’). CFE filed a Change
of the burden imposed by the collection written certification with the CFTC In its filing with the Commission, CFE
of information; (c) ways to enhance the under Section 5c(c) of the Commodity included statements concerning the
quality, utility, and clarity of the Exchange Act (‘‘CEA’’) 2 on May 12, purpose of and basis for the proposed
information collected; and (d) ways to 2016. rule change and discussed any
minimize the burden of the collection of I. Self-Regulatory Organization’s comments it received on the proposed
information on respondents, including Description of the Proposed Rule rule change. The text of these statements
through the use of automated collection Change may be examined at the places specified
techniques or other forms of information in Item IV below. CFE has prepared
technology. Consideration will be given CFE Rule 404A (Trade at Settlement summaries, set forth in Sections A, B,
Transactions) defines a TAS transaction and C below, of the most significant
to comments and suggestions submitted
as a transaction in a CFE contract at a aspects of such statements.
in writing within 60 days of this
price equal to the daily settlement price,
publication. A. Self-Regulatory Organization’s
or a specified differential above or
An agency may not conduct or below the daily settlement price, for the Statement of the Purpose of, and
sponsor, and a person is not required to contract on a trading day. The actual Statutory Basis for, the Proposed Rule
respond to, a collection of information amount is determined subsequent to the Change
unless it displays a currently valid transaction based upon the daily 1. Purpose
control number. settlement price of the contract.
CFE is submitting this amendment in As previously mentioned, he
Please direct your written comment to Exchange has submitted a rule filing
Pamela Dyson, Director/Chief conjunction with CFE’s submission of a
separate rule certification to the CFTC to certification to the CFTC to extend the
Information Officer, Securities and trading hours for TAS transactions in
Exchange Commission, c/o Remi Pavlik- change the end of trading hours for TAS
transactions in CBOE Volatility Index VX futures from 3:12 p.m. to 3:13 p.m.
Simon, 100 F Street NE., Washington, As such, the Exchange is proposing to
(‘‘VX’’) futures from three minutes prior
DC 20549 or send an email to: PRA_ amend CFE Rules 414 and 415, which
to the close of regular trading hours at
Mailbox@sec.gov. the end of a business day to two set forth the reporting requirements for
Dated: June 1, 2016. minutes prior to the close of regular ECRP transactions and Block Trades
trading hours at the end of a business that involve TAS transactions, in order
Brent J. Fields,
asabaliauskas on DSK3SPTVN1PROD with NOTICES
day.3 This change to TAS trading hours to align the reporting time frames with
Secretary. the revised trading hours for VX TAS
[FR Doc. 2016–13329 Filed 6–6–16; 8:45 am]
in VX futures means that the trading
hours for TAS transactions in VX transactions. Although the revisions to
BILLING CODE 8011–01–P these reporting time frames are being
1 15
made as a result of the change in trading
U.S.C. 78s(b)(7).
27 U.S.C. 7a–2(c).
hours for VX TAS transactions, the
3 See CFE Rule Certification Submission Number revised reporting time frames in the
CFE–2016–006 submitted to the CFTC on May 12,
2016. 4 All times referenced are Chicago time.
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![36638 Federal Register / Vol. 81, No. 109 / Tuesday, June 7, 2016 / Notices
proposed rule change would apply to The Exchange believes that the arguments concerning the foregoing,
any product listed on CFE, including a proposed rule change would benefit including whether the proposed rule
security future, in the event that CFE market participants because it would change is consistent with the Act.
were to amend its rules to permit TAS provide them with additional time to Comments may be submitted by any of
transactions in that product. report ECRP transactions and Block the following methods:
Reporting Time Frame for ECRP Trades that involve TAS transactions
Electronic Comments
Transactions That Involve TAS that market participants wish to have
Transactions cleared on the same business day as the • Use the Commission’s Internet
calendar day of the transaction to align comment form (http://www.sec.gov/
Paragraph (i) of CFE Rule 414 with the revised trading hours for TAS rules/sro.shtml); or
(Exchange of Contract for Related transactions in VX futures.
Position) currently provides (i) that the • Send an email to rule-comments@
In addition, the proposed rule change sec.gov. Please include File Number SR–
CFE legs of TAS ECRP transactions benefits market participants by allowing
which are reported to CFE after 3:12 CFE–2016–001 on the subject line.
the reporting of ECRP transactions and
p.m. Monday through Thursday will be Block Trades that involve TAS Paper Comments
submitted for clearing for the next transactions on Fridays to be done
business day and (ii) that TAS ECRP • Send paper comments in triplicate
during the entire time period that TAS
transactions may not be reported after to Secretary, Securities and Exchange
transactions in VX futures are permitted
3:12 p.m. on Friday. The proposed rule Commission, 100 F Street NE.,
in order to be consistent with the
change changes the references in Rule Washington, DC 20549–1090.
change in TAS trading hours for VX
414(i) from 3:12 p.m. to 3:13 p.m. to be futures. All submissions should refer to File
consistent with the change in TAS Number SR–CFE–2016–001. This file
trading hours. B. Self-Regulatory Organization’s number should be included on the
CFE believes this extension is Statement on Burden on Competition subject line if email is used. To help the
justified because it will allow CFE to CFE does not believe that the Commission process and review your
align its ECRP transaction reporting proposed rule change will impose any comments more efficiently, please use
requirements with the revised trading burden on competition not necessary or only one method. The Commission will
hours for VX TAS transactions. appropriate in furtherance of the post all comments on the Commission’s
Reporting Time Frame for Block Trades purposes of the Act. Specifically, the Internet Web site (http://www.sec.gov/
That Involve TAS Transactions Exchange believes that the proposed rules/sro.shtml). Copies of the
rule change will not burden competition submission, all subsequent
Paragraph (g) of CFE Rule 415 (Block amendments, all written statements
because the new reporting time
Trades) currently provides (i) that TAS with respect to the proposed rule
provisions for ECRP transactions and
Block Trades which are reported to CFE change that are filed with the
Block Trades that involve TAS
after 3:12 p.m. Monday through Commission, and all written
transactions will align with the revised
Thursday will be submitted for clearing communications relating to the
trading hours for VX TAS transactions
for the next business day and (ii) that proposed rule change between the
and will apply to equally all market
TAS Block Trades may not be reported Commission and any person, other than
participants.
after 3:12 p.m. on Friday. The proposed those that may be withheld from the
rule change changes the references in C. Self-Regulatory Organization’s public in accordance with the
Rule 415(g) from 3:12 p.m. to 3:13 p.m. Statement on Comments on the provisions of 5 U.S.C. 552, will be
to be consistent with the change in TAS Proposed Rule Change Received From available for Web site viewing and
trading hours. Members, Participants, or Others printing in the Commission’s Public
CFE believes this extension is
No written comments were solicited Reference Room, 100 F Street NE.,
justified because it will allow CFE to
or received with respect to the proposed Washington, DC 20549, on official
align its Block Trade reporting
rule change. business days between the hours of
requirements with the revised trading
10:00 a.m. and 3:00 p.m. Copies of such
hours for VX TAS transactions. III. Date of Effectiveness of the
filing also will be available for
2. Statutory Basis Proposed Rule Change and Timing for
inspection and copying at the principal
Commission Action
The Exchange believes that the office of the Exchange. All comments
proposed rule change is consistent with The proposed rule change will received will be posted without change;
Section 6(b) of the Act,5 in general, and become effective on or after May 26, the Commission does not edit personal
furthers the objectives of Sections 2016, on a date to be announced by the identifying information from
6(b)(5) 6 and 6(b)(7) 7 in particular in Exchange through the issuance of a submissions. You should submit only
that it is designed: circular. At any time within 60 days of information that you wish to make
• To foster coordination of the the date of effectiveness of the proposed available publicly. All submissions
Exchange’s reporting provisions relating rule change, the Commission, after should refer to File Number SR–CFE–
to TAS ECRP and Block Trades with the consultation with the CFTC, may 2016–001, and should be submitted on
revised trading hours for VX TAS summarily abrogate the proposed rule or before June 28, 2016.
transactions; and change and require that the proposed
For the Commission, by the Division of
asabaliauskas on DSK3SPTVN1PROD with NOTICES
• to remove impediments to and rule change be refiled in accordance Trading and Markets, pursuant to delegated
perfect the mechanism of a free and with the provisions of Section 19(b)(1) authority.9
open market and a national market of the Act.8 Brent J. Fields,
system, and in general, to protect IV. Solicitation of Comments Secretary.
investors and the public interest. [FR Doc. 2016–13312 Filed 6–6–16; 8:45 am]
Interested persons are invited to
5 15 U.S.C. 78f(b). submit written data, views, and BILLING CODE 8011–01–P
6 15 U.S.C. 78f(b)(5).
7 15 U.S.C. 78f(b)(7). 8 15 U.S.C. 78s(b)(1). 9 17 CFR 200.30–3(a)(73).
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Document Created: 2018-02-08 07:32:08
Document Modified: 2018-02-08 07:32:08
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 81 FR 36637 |
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