81 FR 9533 - Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 8.2

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 37 (February 25, 2016)

Page Range		9533-9535
FR Document		2016-03959
Federal Register, Volume 81 Issue 37 (Thursday, February 25, 2016)
[Federal Register Volume 81, Number 37 (Thursday, February 25, 2016)]
[Notices]
[Pages 9533-9535]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-03959]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77194; File No. SR-C2-2016-002]


Self-Regulatory Organizations; C2 Options Exchange, Incorporated; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Rule 8.2

February 19, 2016.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on February 10, 2016, C2 Options Exchange, Incorporated (``C2'' or the 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II 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 Substance 
of the Proposed Rule Change

    The Exchange proposes to amend C2 Rule 8.2 relating to the Market-
Maker registration cost for all option classes. The text of the 
proposed rule change is provided below.

(additions are italicized; deletions are [bracketed])

* * * * *

C2 Options Exchange, Incorporated Rules

* * * * *

Rule 8.2. Continuing Market-Maker Registration

    (a)-(c) No change.
    (d) Market-Maker Option Class Registration. Absent an exemption by 
the Exchange, an option class registration of a Market-Maker confers 
the right to quote in that product. A Market-Maker may change its 
registered classes upon advance notification to the Exchange in a form 
and manner prescribed by the Exchange.
    Each Trading Permit held by a Market-Maker has a registration 
credit of 1.0. A Market-Maker may select for each Trading Permit the 
Market-Maker holds any combination of option classes, whose aggregate 
registration cost does not exceed 1.0. Option class ``registration 
costs'' are set forth below:

------------------------------------------------------------------------
                     Option class                      Registration cost
------------------------------------------------------------------------
All options..........................................        [.001].0001
------------------------------------------------------------------------

    (e) No change.
* * * * *
    The text of the proposed rule change is also available on the 
Exchange's Web site (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, and at the Commission's Public Reference Room.

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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this rule change is to amend C2 Rule 8.2 relating to 
the Market-Maker registration cost for all option classes. All option 
classes on C2 currently have a registration cost of .001. C2 proposes 
to reduce the registration cost to .0001, effective February 22, 2016, 
which would apply to all existing classes that currently trade on C2 
and to all classes listed in the future.
    In support of this filing, the Exchange states it intends to add an 
additional 2,000 option classes beginning the week of February 22, 
2016. By reducing the registration cost for existing classes, Market-
Makers could utilize the excess registration capacity of their current 
trading permits to quote in these additional option classes when they 
begin trading without having to obtain any additional trading permits, 
which promotes competition and efficiency.
    The Exchange will announce its plan to reduce the registration cost 
for all option classes via Regulatory Circular at least one business 
day before February 22, 2016, which the Exchange believes provides 
Market-Makers with sufficient notice.

[[Page 9534]]

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. \3\ Specifically, the Exchange believes the proposed rule change 
is consistent with the Section 6(b)(5) \4\ 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) \5\ requirement that the rules of 
an exchange not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
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    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(5).
    \5\ Id.
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    In particular, the Exchange believes that reducing the registration 
cost for all option classes will foster competition and efficiency by 
enabling Market-Makers to use the excess registration capacity to quote 
in additional option classes. The Exchange believes this may result in 
more liquidity and competitive pricing, which ultimately benefits 
investors. Additionally, the proposed rule change does not result in 
unfair discrimination, as the reduced registration cost will apply to 
all Market-Makers.

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

    C2 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. The proposed rule change will 
apply to all Market-Makers (it is applicable only to Market-Makers, 
since only Market-Makers can register to quote in classes). C2 does not 
believe that the proposed rule change will impose any burden on 
intermarket competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because the proposed rule change 
only applies to the C2 Market-Maker registration process. C2 believes 
that the proposed rule change will enhance competition among market 
participants and benefit investors and the marketplace because Market-
Makers will be able to use the excess registration capacity to quote in 
additional option classes and increase overall liquidity on the 
Exchange.

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 Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \6\ and Rule 19b-4(f)(6) thereunder.\7\ 
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 and Rule 19b-
4(f)(6)(iii) thereunder.
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    \6\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \7\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of 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. 
The Exchange has satisfied this requirement.
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    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 has stated that it intends to add an additional 
2,000 option classes on February 22, 2016. The Exchange has argued that 
waiving the operative delay would allow it to reduce the registration 
cost for all option classes on that date, which would allow Market-
Makers to utilize their excess registration capacity to quote and 
provide liquidity in these additional option classes on their first 
trading day without having to obtain additional trading permits. The 
Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest 
because it would provide Market-Makers with the ability to quote and 
provide liquidity in the new option classes that C2 seeks to list 
without necessarily requiring Market Makers to purchase an additional 
trading permit to do so. Market Makers could thus be incentivized to 
begin making markets in the new classes without delay, which could 
enhance liquidity in these new classes to the potential benefit of 
investors. For this reason, the Commission hereby waives the 30-day 
operative delay requirement and designates the proposed rule change as 
operative upon filing.\8\
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    \8\ 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).
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    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.

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-C2-2016-002 on the subject line.

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 SR-C2-2016-002. 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

[[Page 9535]]

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 offices 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-C2-2016-002, 
and should be submitted on or before March 17, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2016-03959 Filed 2-24-16; 8:45 am]
 BILLING CODE 8011-01-P
Federal Register / Vol. 81, No. 37 / Thursday, February 25, 2016 / Notices 9533

list and trade shares (‘‘Shares’’) of the SECURITIES AND EXCHANGE Option class Registration cost
following under NYSE Arca Equities COMMISSION
Rule 8.600: RiverFront Dynamic All options ....................... [.001].0001
Unconstrained Income ETF and [Release No. 34–77194; File No. SR–C2–
RiverFront Dynamic Core Income ETF. 2016–002] (e) No change.
The Commission published notice of the * * * * *
proposed rule change in the Federal Self-Regulatory Organizations; C2
Register on January 6, 2016.3 On Options Exchange, Incorporated; The text of the proposed rule change
January 19, 2016, the Exchange Notice of Filing and Immediate is also available on the Exchange’s Web
submitted Amendment No. 1 to the Effectiveness of Proposed Rule site (http://www.cboe.com/AboutCBOE/
proposed rule change, and on January Change To Amend Rule 8.2 CBOELegalRegulatoryHome.aspx), at
29, 2016, the Exchange submitted the Exchange’s Office of the Secretary,
Amendment No. 2 to the proposed rule February 19, 2016. and at the Commission’s Public
change.4 The Commission received no Pursuant to Section 19(b)(1) of the Reference Room.
comment letters on the proposed rule Securities Exchange Act of 1934 II. Self-Regulatory Organization’s
change. (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 Statement of the Purpose of, and
Section 19(b)(2) of the Act 5 provides notice is hereby given that on February Statutory Basis for, the Proposed Rule
that, within 45 days of the publication 10, 2016, C2 Options Exchange, Change
of notice of the filing of a proposed rule Incorporated (‘‘C2’’ or the ‘‘Exchange’’)
change, or within such longer period up filed with the Securities and Exchange In its filing with the Commission, the
to 90 days as the Commission may Commission (‘‘Commission’’) the Exchange included statements
designate if it finds such longer period proposed rule change as described in concerning the purpose of and basis for
to be appropriate and publishes its Items I and II below, which Items have the proposed rule change and discussed
reasons for so finding or as to which the been prepared by the Exchange. The any comments it received on the
self-regulatory organization consents, Commission is publishing this notice to proposed rule change. The text of these
the Commission shall either approve the solicit comments on the proposed rule statements may be examined at the
proposed rule change, disapprove the change from interested persons. places specified in Item IV below. The
proposed rule change, or institute Exchange has prepared summaries, set
I. Self-Regulatory Organization’s forth in sections A, B, and C below, of
proceedings to determine whether the Statement of the Terms of Substance of
proposed rule change should be the most significant aspects of such
the Proposed Rule Change statements.
disapproved. The Commission is
extending this 45-day time period. The Exchange proposes to amend C2 A. Self-Regulatory Organization’s
The Commission finds that it is Rule 8.2 relating to the Market-Maker Statement of the Purpose of, and the
appropriate to designate a longer period registration cost for all option classes. Statutory Basis for, the Proposed Rule
within which to take action on the The text of the proposed rule change is Change
proposed rule change so that it has provided below.
sufficient time to consider the proposed 1. Purpose
(additions are italicized; deletions are
rule change. Accordingly, the [bracketed])
Commission, pursuant to Section The purpose of this rule change is to
19(b)(2) of the Act,6 designates April 5, * * * * * amend C2 Rule 8.2 relating to the
2016, as the date by which the Market-Maker registration cost for all
C2 Options Exchange, Incorporated option classes. All option classes on C2
Commission should either approve or Rules
disapprove or institute proceedings to currently have a registration cost of
determine whether to disapprove the * * * * * .001. C2 proposes to reduce the
proposed rule change (File Number SR– registration cost to .0001, effective
Rule 8.2. Continuing Market-Maker February 22, 2016, which would apply
NYSEArca-2015–125), as modified by Registration
Amendment Nos. 1 and 2. to all existing classes that currently
(a)–(c) No change. trade on C2 and to all classes listed in
For the Commission, by the Division of the future.
Trading and Markets, pursuant to delegated (d) Market-Maker Option Class
authority.7 Registration. Absent an exemption by In support of this filing, the Exchange
Brent J. Fields, the Exchange, an option class states it intends to add an additional
Secretary. registration of a Market-Maker confers 2,000 option classes beginning the week
the right to quote in that product. A of February 22, 2016. By reducing the
[FR Doc. 2016–03945 Filed 2–24–16; 8:45 am]
Market-Maker may change its registered registration cost for existing classes,
BILLING CODE 8011–01–P
classes upon advance notification to the Market-Makers could utilize the excess
Exchange in a form and manner registration capacity of their current
3 See Securities Exchange Act Release No. 34–
prescribed by the Exchange. trading permits to quote in these
76798 (December 30, 2015), 81 FR 526 (January 6,
2016) (NYSEArca–2015–125). Each Trading Permit held by a additional option classes when they
4 Amendment No. 1 replaced and superseded the
Market-Maker has a registration credit of begin trading without having to obtain
original filing in its entirety. Amendment No. 1 is 1.0. A Market-Maker may select for each any additional trading permits, which
available at https://www.sec.gov/comments/sr- promotes competition and efficiency.
mstockstill on DSK4VPTVN1PROD with NOTICES

nysearca-2015-125/nysearca2015125-1.pdf. Trading Permit the Market-Maker holds
Amendment No. 2 replaced and superseded the any combination of option classes, The Exchange will announce its plan
original filing, as modified by Amendment No. 1, whose aggregate registration cost does to reduce the registration cost for all
in its entirety. Amendment No. 2 is available at not exceed 1.0. Option class option classes via Regulatory Circular at
https://www.sec.gov/comments/sr-nysearca-2015-
125/nysearca2015125-2.pdf. ‘‘registration costs’’ are set forth below: least one business day before February
5 15 U.S.C. 78s(b)(2). 22, 2016, which the Exchange believes
6 Id. 1 15 U.S.C. 78s(b)(1). provides Market-Makers with sufficient
7 17 CFR 200.30–3(a)(31). 2 17 CFR 240.19b–4. notice.

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9534 Federal Register / Vol. 81, No. 37 / Thursday, February 25, 2016 / Notices

2. Statutory Basis investors and the marketplace because purchase an additional trading permit to
The Exchange believes the proposed Market-Makers will be able to use the do so. Market Makers could thus be
rule change is consistent with the Act excess registration capacity to quote in incentivized to begin making markets in
and the rules and regulations additional option classes and increase the new classes without delay, which
thereunder applicable to the Exchange overall liquidity on the Exchange. could enhance liquidity in these new
and, in particular, the requirements of C. Self-Regulatory Organization’s classes to the potential benefit of
Section 6(b) of the Act. 3 Specifically, Statement on Comments on the investors. For this reason, the
the Exchange believes the proposed rule Proposed Rule Change Received From Commission hereby waives the 30-day
change is consistent with the Section Members, Participants, or Others operative delay requirement and
6(b)(5) 4 requirements that the rules of designates the proposed rule change as
The Exchange neither solicited nor operative upon filing.8
an exchange be designed to prevent
received comments on the proposed At any time within 60 days of the
fraudulent and manipulative acts and
rule change. filing of the proposed rule change, the
practices, to promote just and equitable
principles of trade, to foster cooperation III. Date of Effectiveness of the Commission summarily may
and coordination with persons engaged Proposed Rule Change and Timing for temporarily suspend such rule change if
in regulating, clearing, settling, Commission Action it appears to the Commission that such
processing information with respect to, action is necessary or appropriate in the
The Exchange has filed the proposed
and facilitating transactions in public interest, for the protection of
rule change pursuant to Section
securities, to remove impediments to investors, or otherwise in furtherance of
19(b)(3)(A)(iii) of the Act 6 and Rule
and perfect the mechanism of a free and the purposes of the Act. If the
19b–4(f)(6) thereunder.7 Because the
open market and a national market Commission takes such action, the
proposed rule change does not: (i)
system, and, in general, to protect Significantly affect the protection of Commission will institute proceedings
investors and the public interest. investors or the public interest; (ii) to determine whether the proposed rule
Additionally, the Exchange believes the impose any significant burden on change should be approved or
proposed rule change is consistent with competition; and (iii) become operative disapproved.
the Section 6(b)(5) 5 requirement that prior to 30 days from the date on which IV. Solicitation of Comments
the rules of an exchange not be designed it was filed, or such shorter time as the
to permit unfair discrimination between Interested persons are invited to
Commission may designate, if
customers, issuers, brokers, or dealers. submit written data, views, and
consistent with the protection of
In particular, the Exchange believes arguments concerning the foregoing,
investors and the public interest, the
that reducing the registration cost for all including whether the proposed rule
proposed rule change has become
option classes will foster competition effective pursuant to Section 19(b)(3)(A) change is consistent with the Act.
and efficiency by enabling Market- of the Act and Rule 19b–4(f)(6)(iii) Comments may be submitted by any of
Makers to use the excess registration thereunder. the following methods:
capacity to quote in additional option The Exchange has asked the Electronic Comments
classes. The Exchange believes this may Commission to waive the 30-day
result in more liquidity and competitive operative delay so that the proposal may • Use the Commission’s Internet
pricing, which ultimately benefits become operative immediately upon comment form (http://www.sec.gov/
investors. Additionally, the proposed filing. The Exchange has stated that it rules/sro.shtml); or
rule change does not result in unfair intends to add an additional 2,000 • Send an email to rule-comments@
discrimination, as the reduced option classes on February 22, 2016. sec.gov. Please include File Number SR–
registration cost will apply to all The Exchange has argued that waiving C2–2016–002 on the subject line.
Market-Makers. the operative delay would allow it to Paper Comments
B. Self-Regulatory Organization’s reduce the registration cost for all
option classes on that date, which • Send paper comments in triplicate
Statement on Burden on Competition to Brent J. Fields, Secretary, Securities
would allow Market-Makers to utilize
C2 does not believe that the proposed and Exchange Commission, 100 F Street
their excess registration capacity to
rule change will impose any burden on NE., Washington, DC 20549–1090.
quote and provide liquidity in these
competition that is not necessary or All submissions should refer to File
additional option classes on their first
appropriate in furtherance of the Number SR–C2–2016–002. This file
trading day without having to obtain
purposes of the Act. The proposed rule number should be included on the
additional trading permits. The
change will apply to all Market-Makers subject line if email is used. To help the
Commission believes that waiving the
(it is applicable only to Market-Makers, Commission process and review your
30-day operative delay is consistent
since only Market-Makers can register to comments more efficiently, please use
with the protection of investors and the
quote in classes). C2 does not believe only one method. The Commission will
public interest because it would provide
that the proposed rule change will post all comments on the Commission’s
Market-Makers with the ability to quote
impose any burden on intermarket Internet Web site (http://www.sec.gov/
and provide liquidity in the new option
competition that is not necessary or rules/sro.shtml). Copies of the
classes that C2 seeks to list without
appropriate in furtherance of the submission, all subsequent
necessarily requiring Market Makers to
purposes of the Act because the amendments, all written statements
proposed rule change only applies to 6 15 with respect to the proposed rule
U.S.C. 78s(b)(3)(A)(iii).
mstockstill on DSK4VPTVN1PROD with NOTICES

the C2 Market-Maker registration 7 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– change that are filed with the
process. C2 believes that the proposed 4(f)(6)(iii) requires a self-regulatory organization to Commission, and all written
rule change will enhance competition give the Commission written notice of its intent to
communications relating to the
among market participants and benefit file the proposed rule change, along with a brief
description and text of the proposed rule change,
at least five business days prior to the date of filing 8 For purposes only of waiving the 30-day
3 15 U.S.C. 78f(b). of the proposed rule change, or such shorter time operative delay, the Commission has considered the
4 15 U.S.C. 78f(b)(5).
as designated by the Commission. The Exchange proposed rule’s impact on efficiency, competition,
5 Id. has satisfied this requirement. and capital formation. See 15 U.S.C. 78c(f).

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Document Created: 2018-02-02 14:35:17
Document Modified: 2018-02-02 14:35:17
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
FR Citation		81 FR 9533