82 FR 10422 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Certain Rules Related to Flexible Exchange Options
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 27 (February 10, 2017)
Federal Register Volume 82, Issue 27 (February 10, 2017)
| Page Range | 10422-10428 | |
| FR Document | 2017-02736 |
[Federal Register Volume 82, Number 27 (Friday, February 10, 2017)] [Notices] [Pages 10422-10428] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-02736] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-79976; File No. SR-NYSEArca-2017-02] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Certain Rules Related to Flexible Exchange Options February 6, 2017. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that on January 25, 2017, NYSE Arca, Inc. (``NYSE Arca'' 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. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend certain rules related to Flexible Exchange (``FLEX'') Options. The proposed rule change is available on the Exchange's Web site at www.nyse.com, at the principal office of the Exchange, 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 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 purpose of this filing is to amend certain rules related to FLEX Options, as described below. FLEX Options are customized equity or index contracts that allow investors to tailor contract terms for exchange-listed equity and index options.\4\ The Exchange is proposing to allow FLEX Options in ByRDs, make available additional settlement styles, modify how exercise prices and premiums are expressed, change certain provisions relating to floor-based trading, and modify other related provisions pertaining to FLEX Options. --------------------------------------------------------------------------- \4\ See Rule 5.30(b)(4) (defining ``FLEX option''). See generally Section 4, Flexible Exchange Options, Rules 5.30-5.44. --------------------------------------------------------------------------- FLEX Options for Binary Return Derivatives Contracts (``ByRDs'') The Exchange proposes to modify its rules to enable market participants to trade FLEX options contracts in ByRDs.\5\ Specifically, the Exchange proposes to add a new definition of ``FLEX ByRDs,'' which would be a ``Binary Return Derivatives contract on any ByRD-eligible underlying security that is subject to the rules in this Section.'' \6\ The Exchange also proposes to revise Rule 5.30(b)(15) to include FLEX ByRDs in the definition of ``Series of FLEX Options.'' \7\ Because FLEX ByRDs would have to be settled in cash, based on the Volume-Weighted Average Price (or VWAP) of the underlying security, market participants could not modify these terms.\8\ However, market participants may trade FLEX ByRDs with non-standard strike prices and/or non-standard expiration dates. Regarding position limits, the Exchange proposes to add paragraph (b)(ii) to Rule 5.35 to provide that positions in FLEX ByRDs shall be the same as Non-FLEX ByRDs, as set forth in Rule 5.86(a), except that positions in FLEX ByRDs shall be aggregated with positions in Non-FLEX ByRDs on the same or similar underlying for the purpose of calculating position limits.\9\ The Exchange also proposes to include in proposed Rule 5.35(b)(ii) that ``[f]or purposes of the position limits established under this Rule, long positions in `Finish Low' and short positions in `Finish High' Binary Return Derivatives shall be considered to be on the same side of the market; and short positions in `Finish Low' and long positions in `Finish High' Binary Return Derivatives shall be considered to be on the same side of the market.'' \10\ Consistent with these changes, the Exchange also proposes to define Non-FLEX ByRDs as ``a Non-FLEX Option that is a Binary Return Derivatives contract,'' in new paragraph (b)(22) to Rule 5.30. The Exchange believes that FLEX ByRDs would enable market participants to negotiate terms that differ from standardized ByRDs, which would, in turn, provide greater opportunities for investors to manage risk through the use of FLEX Options.\11\ The Exchange notes that the proposed rules related to FLEX ByRDs are materially identical to rules recently approved on another options exchange.\12\ --------------------------------------------------------------------------- \5\ ByRDs are European-style option contracts on individual stocks, exchange-traded funds (``ETFs'') and Index-Linked Securities that have a fixed return in cash based on a set strike price; satisfy specified listing criteria; and may only be exercised at expiration pursuant to the Rules of the Options Clearing Corporation (the ``OCC''). See Rules 5.82(b), 5.90. For a description of ``Exchange-Traded Fund Shares'' and ``Index-Linked Securities,'' see also Rule 5.3(g) and (j). \6\ See proposed Rule 5.30(b)(19). \7\ See proposed Rule 5.30(b)(15) (proposing to add that a ``Series of FLEX Options'' would include, in the case of FLEX ByRDs, all such option contracts of the same class having the same expiration date, strike price, and exercise settlement amount). \8\ See ``Statutory Basis'' section herein (in the second paragraph) for further discussion. \9\ The Exchange also proposes to re-format Rule 5.35 to make clear the position limits that apply to each of FLEX Index Options and FLEX Equity Options. In this regard, the Exchange proposes to modify the title of the Rule 5.35 to remove reference to ``Index'' and re-titled it as ``Position Limits for FLEX Options.'' Further, the Exchange proposes reformatting changes to clarify that Rule 5.35(a), with proposed sub-parts (i) and (ii), refers to FLEX Index Options and proposed Rule 5.35(b), refers to FLEX Equity Options. Finally, the Exchange proposes to re-locate current paragraph (d) to Rule 5.35 regarding the aggregation of position limits for FLEX Index Options to proposed paragraph (a)(iii), which would add clarity and consistency to Exchange rules. See proposed Rule 5.35(a) and (b). \10\ See ``Statutory Basis'' section herein (in the third paragraph) for further discussion. \11\ The Exchange also proposes to modify Rule 5.32(f)(3)(ii) to provide that FLEX ByRDs must be settled the same as non-FLEX ByRDs. See proposed Rule 5.32(f)(3)(ii) (discussed herein under ``Additional Updates to Reflect Trading in FLEX Options''); see also Rule 5.89 (Determination of the Settlement Price of ByRDs). \12\ See Securities Exchange Act Release Nos. 79125 (October 19, 2016), 81 FR 73452 (October 25, 2016) (``MKT Approval Order '') (order approving modifications to FLEX Options, including adding FLEX ByRDs); 78348 (July 15, 2016), 81 FR 47469 (July 21, 2016) (``MKT Notice'') (SR-NYSEMKT-2016-48). See also NYSE MKT Rules 900G(b)(16),(17), (22); 903G(c)(3)(i)-(ii); 906G(b)(ii). --------------------------------------------------------------------------- Additional Settlement Styles for FLEX Options: Asian and Cliquet Style The Exchange proposes to permit parties to FLEX Index Options on [[Page 10423]] Broad-Based Index Options to designate Asian style settlement and Cliquet style settlement, both of which are currently offered on another options exchange.\13\ --------------------------------------------------------------------------- \13\ See e.g., Chicago Board Options Exchange, Inc. (``CBOE'') Rules 24A.1 (Definitions), 24A.4 (Terms of FLEX Options), 24B.1 (Definitions) and 24B.4 (Terms of FLEX Options). See also NYSE MKT Rules 900G(b)(18), (19); 903G(b)(4),(5). FLEX ByRDs could not be settled using Asian or Cliquet settlement. See, e.g., supra note 11. --------------------------------------------------------------------------- As proposed in new paragraph (e)(5) of Rule 5.32 and new paragraph (b)(20) of Rule 5.30, FLEX Index Options on Broad-Based Index Options with Asian style settlement would be cash-settled call \14\ option contracts for which the final payout would be based on an arithmetic average of specified closing prices of an underlying Broad-Based Index taken on twelve predetermined monthly observation dates, including the expiration date (``Asian option''). The monthly observation dates would be determined by working backwards from the farthest out observation date prior to the expiration date. When the scheduled observation date for an Asian option occurs on a holiday or a weekend, the observation would occur on the immediately preceding business day. The exercise settlement amount for Asian options would be calculated similarly to other options (i.e., the difference between the strike price and the averaged settlement value would determine the value, or ``moneyness'' of the contract at expiration). Asian options would have a term of approximately one year and would expire anytime from 350 to 371 days (i.e., approximately 50 to 53 calendar weeks) from the date of initial listing. The contract multiplier (or Index Multiplier) for an Asian option that settles in U.S. dollars would be $100, for example.\15\ Finally, because settlement value is determined by observations taken over a 12-month period, Asian style settlement requires European-style exercise. An example of an Asian FLEX call option expiring in-the-money follows. On January 21, 2015, an investor hedging the value of XYZ Index over a year purchases a call option expiring on January 22, 2016 with a strike price of 2000 and a contract multiplier of $100. The option has monthly observation dates occurring on the 23rd of each month. --------------------------------------------------------------------------- \14\ Puts would not be permitted. \15\ See Rule 5.30(b)(9) providing that Index Multiplier means the monetary amount, stated in terms of the settlement currency specified in the contract, by which the current index value is to be multiplied to arrive at the value required to be delivered to the holder of a call or by the holder of a put upon valid exercise of the option and setting forth the established Index Multipliers for FLEX Index Options on domestic indices. ------------------------------------------------------------------------ Monthly observation date XYZ index closing value ------------------------------------------------------------------------ 23-Feb-15............................. 2025.36. 23-Mar-15............................. 2049.34. 23-Apr-15............................. 2019.77. 22-May-15*............................ 1989.65. 23-Jun-15............................. 2005.64. 23-Jul-15............................. 2035.10. 21-Aug-15*............................ 2032.15. 23-Sep-15............................. 2076.18. 23-Oct-15............................. 2099.01. 23-Nov-15............................. 2109.32. 23-Dec-15............................. 2085.42. 22-Jan-16............................. 2084.81. --------------------------------- Exercise (Averaged) Settlement Value 24,611.75/12 = 2050.98. ------------------------------------------------------------------------ \*\ Because Asian FLEX options use the ``preceding business day convention,'' the dates of May 23, 2015 and August 23, 2015, were not used in the above example because those dates will fall on a weekend or a holiday. Instead the business days immediately preceding those dates were used as the monthly observation date. If, in the above example, the strike price for the Asian FLEX call option was 2060, that contract would have expired out-of-the-money. This is because the exercise settlement value for this 2060 call option is equal to 2050.98 (when rounded). Since the strike price of 2060 is more than the 2050.98 exercise settlement value, this option would not be exercised and would expire worthless. As proposed in new paragraph (e)(6) of Rule 5.32 and new paragraph (b)(21) of Rule 5.30, FLEX Index Options on Broad-Based Index Options with Cliquet style settlement would be cash-settled call \16\ option contracts for which the final payout would be based on the sum of monthly returns (i.e., percent changes in the closing value of the underlying Broad-Based Index from one month to the next), subject to a monthly return ``cap'' (e.g., 3%), applied over twelve monthly observation dates (``Cliquet option''). Cliquet options would have a term of approximately one year and would expire anytime from 350 to 371 days (which is approximately 50 to 53 calendar weeks) from the date of initial listing. The contract multiplier for a Cliquet option that settles in U.S. dollars, for example, would be $100.\17\ --------------------------------------------------------------------------- \16\ Puts would not be permitted. \17\ See id. --------------------------------------------------------------------------- The parties to a Cliquet option would designate a set of monthly observation dates for each contract and an expiration date for each contract. The monthly observation date would be the date each month on which the price of the underlying broad-based index would be observed for the purpose of calculating the exercise settlement value for Cliquet FLEX Options. Each Cliquet FLEX Option would have 12 consecutive monthly observation dates (which includes an observation on the expiration date) and each observation would be based on the closing price of the underlying broad-based index. The specific monthly observation dates would be determined by working backwards from the farthest out observation date prior to the expiration date. When the scheduled observation date for a Cliquet option occurs on a holiday or a weekend, the observation would occur on the immediately preceding business day. The parties may not designate a subsequent business day convention for Cliquet options. The parties to a Cliquet option would designate a capped monthly return (percent change in the closing values of the underlying broad- based index from one month to the next month) for the contract, which would be the maximum monthly return that would be included in the calculation of the exercise settlement value for the contract. On each monthly observation date, the Exchange would determine the actual monthly return (the percent change of the underlying broad-based index) using the closing value of the broad-based index on the current monthly observation date and the closing value of the broad-based index on the previous monthly observation date. The Exchange would then compare the actual monthly return to the capped monthly return. The value to be included as the monthly return for a Cliquet option would be the lesser of the actual monthly return or the capped monthly return. For example, if the actual monthly return of the underlying broad- based index was 1.75% and the designated capped monthly return for a Cliquet option was 2%, the 1.75% value would be included (and not the 2%) as the value for the observation date to determine the exercise settlement value. Using this same example, if the actual monthly return of the underlying broad-based index was 3.30%, the 2% value would be included (and not the 3.30%) as the value of the observation date to determine the exercise settlement value. This latter example illustrates that Cliquet options have a capped upside. Cliquet options do not, however, have a capped downside for the monthly return that would be included in determining the exercise settlement value. Drawing on this same example, if the actual monthly return of the underlying broad-based index was -4.07%, the -4.07% value would be included as the value for the observation date to determine the exercise settlement value. There would be, however, be a global floor for Cliquet [[Page 10424]] options so that if the sum of the monthly returns is negative, a Cliquet option would expire worthless. Unlike other options, Cliquet options would not have a traditional exercise (strike) price. Rather, the exercise (strike) price field for a Cliquet option would represent the designated capped monthly return for the contract and would be expressed in dollars and cents. For example, a capped monthly return of 2.25% would be represented by the dollar amount of $2.25. The ``strike'' price for a Cliquet option may only be expressed in a dollar and cents amount and the ``strike'' price for a Cliquet option may only span a range between $0.05 and $25.95. In addition, the ``strike'' price for a Cliquet option may only be designated in $0.05 increments, e.g., $1.75, $2.50, $4.15. Increments of $0.01 in the ``strike'' price field (representing the capped monthly return) would not be permitted. The first ``monthly'' return for a Cliquet option would be based on the initial reference value, which would be the closing value of the underlying broad-based index on the date a new Cliquet option is listed. The time period measured for the first ``monthly'' return would be between the initial listing date and the first monthly observation date. For example, if a Cliquet option was opened on January 1 and the parties designated the 31st of each month as the monthly observation date, the measurement period for the first monthly return would span the time period from January 1 to January 31. The time period measured for the second monthly return, and all subsequent monthly returns, would run from the 31st of one month to the 31st of the next month (or the last Exchange business day of each month depending on the actual number of calendar days in each month covered by the contract). Cliquet options would have European-style exercise and may not be exercised prior to the expiration date. The exercise settlement value for Cliquet options would be equal to the initial reference price of the underlying broad-based index multiplied by the sum of the monthly returns (with the cap applied) on the 12 consecutive monthly observation dates, which include the expiration date of the option, provided that the sum is greater than 0. If the sum of the monthly returns (with the applied cap) is 0 or a less, the option would expire worthless. An example of a Cliquet option follows. On January 21, 2015, an investor hedging the value of the S&P 500 Index over a year purchases a Cliquet FLEX call option expiring on January 22, 2016 with a capped monthly return of 2% and a contract multiplier of $100. The initial reference price of the S&P 500 Index (closing value) on January 21, 2015 is 2000. The option has monthly observation dates occurring on the 23rd of each month. ---------------------------------------------------------------------------------------------------------------- Capped S&P 500 index Actual monthly Sum of Monthly observation date closing value monthly return (CMRi) monthly (Si) return % % returns % ---------------------------------------------------------------------------------------------------------------- 23-Feb-15....................................... 2025.36 1.27 1.27 1.27 23-Mar-15....................................... 2049.34 1.18 1.18 2.45 23-Apr-15....................................... 2019.77 -1.44 -1.44 1.01 22-May-15*...................................... 1989.65 -1.49 -1.49 -0.48 23-Jun-15....................................... 2005.64 0.80 0.80 0.32 23-Jul-15....................................... 2035.10 1.47 1.47 1.79 21-Aug-15*...................................... 2032.15 -0.14 -0.14 1.65 23-Sep-15....................................... 2076.18 2.17 **2.00 3.65 23-Oct-15....................................... 2099.01 1.10 1.10 4.75 23-Nov-15....................................... 2109.32 0.49 0.49 5.24 23-Dec-15....................................... 2085.42 -1.13 -1.13 4.11 22-Jan-16....................................... 2084.81 -0.03 -0.03 4.08 --------------------------------------------------------------- Exercise Settlement Value....................... [(4.08% * 2000.00)] + 2 = 83.60 ---------------------------------------------------------------------------------------------------------------- \*\ Because Cliquet FLEX options use the ``preceding business day convention,'' the dates of May 23, 2015, and August 23, 2015, were not used in the above example because those dates fall on a weekend or a holiday. Instead the business days immediately preceding those dates were used as the monthly observation dates. \**\ Monthly capped return applied. The exercise settlement amount for this January 22, 2016 Cliquet option, with a capped monthly 2% return (``strike price'') and a contract multiplier of $100 would be equal to $8,360. This value would be calculated by summing the monthly capped returns (equal to 4.08%) and multiplying that amount by the initial reference price (equal to 2000), which equals 81.60. The ``strike price'' (2%) amount would then be added to that amount (81.60) to arrive at an exercise settlement value of 83.60. Because the ``strike price'' field for a Cliquet option would be the manner in which the designated capped monthly return would be identified for the contract and because the designated monthly return for the contract would have been already substantively applied to determine the exercise settlement value, the ``strike price'' of 2.0 would be subtracted from the exercise settlement value before the contract multiplier ($100) would be applied [(83.60--2) * 100]. Accordingly, resulting payout for this contract would be $8,160. If the sum of the monthly capped returns had been negative, this option would have expired worthless. Regarding the proposed settlement styles, the Exchange would use the same surveillance procedures currently utilized for the Exchange's other FLEX Options, including FLEX Index Options.\18\ The Exchange further represents that these surveillance procedures will be adequate to monitor trading in these option products. For surveillance purposes, the Exchange would have access to information regarding trading activity in the pertinent underlying securities. --------------------------------------------------------------------------- \18\ See ``Statutory Basis'' section herein (in the fourth paragraph) for further discussion. --------------------------------------------------------------------------- FLEX Exercise Prices and Premiums The Exchange also proposes to modify how exercise prices and premiums for FLEX Options may be expressed, which would reflect recent changes in the marketplace. The Exchange notes that when it adopted rules for FLEX Options, [[Page 10425]] strike prices were designated in one-eighth of a dollar, and options were priced in fractions of a dollar.\19\ Now that decimalization has been applied to options trading, including trading in FLEX Options, certain exchange rules have been revised to reflect the decimal equivalent of a previously approved fractional term. Thus, the Exchange proposes to collapse current Rules 5.32(f)(2) and (f)(5) into a revised Rule 5.32(f)(2), to provide that exercise prices and premiums may be stated in terms of: --------------------------------------------------------------------------- \19\ See Rule 5.32(f)(2) (providing that exercise prices may be rounded to the nearest .10 or one-eighth of a dollar) and (f)(5) (providing that exercise prices may be rounded to the nearest .10). --------------------------------------------------------------------------- (i) A dollar amount; (ii) a method for fixing such a number at the time a FLEX Request for Quote or FLEX Order is traded; or (iii) a percentage of the price of the underlying security at the time of the trade or as of the close of trading on the Exchange on the trade date. The Exchange notes that this change would align with the Exchange's treatment of FLEX Index Options as well as the rules of other exchanges.\20\ In addition, the Exchange proposes to modify Rule 5.32 by adding new paragraph (e)(2)(C) and modifying paragraph (f)(2) to provide that: --------------------------------------------------------------------------- \20\ See, e.g., Rule 5.32(e)(2); CBOE Rule 24A.4(b)(2) and (c)(2); NYSE MKT Rules 903G(b)(1), (c)(2). Exercise prices may be rounded to the nearest minimum tick or other decimal increment determined by the Exchange on a class-by- class basis that may not be smaller than $0.01. Premiums will be rounded to the nearest minimum tick. For exercise prices and premiums stated using a percentage-based methodology, such values may be stated in a percentage increment determined by the Exchange on a class-by-class basis that may not be smaller than 0.01% and will be rounded as provided above.\21\ --------------------------------------------------------------------------- \21\ See proposed Rule 5.32(e)(2)(C) and (f)(2). The proposed rule removes reference to exercise prices being rounded to the nearest tenth or one-eighth of a dollar. See id. The Exchange notes that this proposed change is consistent with the rules of another options exchange.\22\ The Exchange believes this change would provide greater flexibility in terms of describing an option contract tailored to the needs of the investor. --------------------------------------------------------------------------- \22\ See, e.g., CBOE Rule 24A.4(b)(2) (permitting bids and offers, strikes and premiums to be expressed in increments determined by the Exchange, which increments may be no smaller than $0.01). See also NYSE MKT Rules 903G(b)(1), (c)(2). --------------------------------------------------------------------------- Additional Updates To Reflect Trading in FLEX Options The Exchange is also proposing the following modifications to streamline and update FLEX Options Rules:``FLEX'' Options. The Exchange proposes to define ``FLEX'' as shorthand for Flexible Options in the title of Section 4.\23\ --------------------------------------------------------------------------- \23\ See proposed Section 4 (Flexible Exchange (``FLEX'') Options). The Exchange also proposes to revise Rule 5.30(b)(2) to remove an errant semi-colon from the term ``BBO Improvement Interval.'' --------------------------------------------------------------------------- Flex Post Official. The Exchange proposes to modify the name of ``FLEX Post Official'' to eliminate ``Post'' from the title to more accurately reflect the position.\24\ When the Exchange first began trading FLEX Options, it designated FLEX Post Officials to refer to specially qualified Trading Officials stationed at specific FLEX posts to address the nuances related to those products (e.g., the method for announcing a Request for Quotes and appointing FLEX Qualified Market Makers). However, as trading in FLEX Options gained popularity, it became apparent that liquidity for FLEX Options was more readily available at trading posts where the standard options in the underlying security traded rather than at a specific FLEX post. Thus, the Exchange proposes to change the name of ``FLEX Post Official'' in Rules 5.30(b)(7) and 5.38 to eliminate the reference to physical FLEX posts and to refer simply to ``FLEX Officials'', which would better reflect the realities of trading FLEX Options on the Exchange and clarify and add transparency to Exchange rules.\25\ --------------------------------------------------------------------------- \24\ See proposed Rule 5.30(b)(7) and 5.38. \25\ See proposed Rules 5.30(b)(7), 5.37(c), and 5.38. Similarly, because there are no longer physical posts on the Trading Floor that are solely ``FLEX posts,'' the Exchange proposes to remove the FLEX modifier from Rule 5.33(b)(1) and Rule 6.78(e)(1)(C) and (E) (Transactions Off the Exchange), such that the revised rule text refers only to a ``post.'' See proposed Rules 5.33(b)(1) and 6.78(e)(1)(C), (E). --------------------------------------------------------------------------- FLEX Trading Procedures and Principles. The Exchange proposes to modify Rule 5.33 (FLEX Trading Procedures and Principles) to likewise update the rule text to accurately reflect trading in FLEX Options. First, the Exchange proposes to modify paragraphs (a)(1) and (2) of Rule 5.33, which provide that FLEX Market Makers handle Requests for Quotes from OTP Holders and OTP Firms when, [sic] to more appropriately reflect that FLEX Officials conduct this work on the Exchange. Thus, the Exchange proposes to replace references to FLEX Market Maker with FLEX Official in Rule 5.33(a)(1)-(2).\26\ The Exchange notes that FLEX Officials are Exchange employees that report to the regulatory officer of the Exchange. As such, the Exchange would ensure that each FLEX Official, or any other designated qualified employees called in to assist the FLEX Official, are properly qualified and meet any necessary requirements.\27\ The Exchange believes the regulatory oversight of FLEX transactions by a properly qualified FLEX Official could help to ensure that FLEX transactions comply with the FLEX rules.\28\ The proposal to replace certain duties of a FLEX Market Maker with respect to FLEX Options transactions with duties assigned to a FLEX Official, who is an Exchange employee, is consistent with the FLEX rules of other exchanges.\29\ Second, consistent with the foregoing changes, the Exchange proposes to modify Rule 5.33(a)(2) and (c)(1)-(3) to more accurately reflect the handling of FLEX Quotes and requests for such quotes. When the Exchange introduced FLEX Options, the Exchange displayed FLEX Request for Quotes and FLEX Quotes at the FLEX post. However, over time, Floor Participants would ask Floor Brokers to communicate the existence of trading interest in particular FLEX Options through various means to their customers and correspondents. Thus, the Exchange proposes to revise the rules to reflect that the FLEX Request for Quotes or the FLEX Quotes are ``disseminated'' (rather than displayed), which would add clarity and transparency to Exchange rules.\30\ --------------------------------------------------------------------------- \26\ The Exchange notes that reference to FLEX Official is consistent with proposed Rule 5.30(b)(7). \27\ See proposed Rule 5.38 (detailing duties of Exchange employees designated to act as FLEX Officials). \28\ See id. \29\ See, e.g., CBOE Rule 24A.5(a)(i) and (ii), 24A.12(b) ; MKT Rule 900G(21) and 910G [sic]. \30\ See proposed Rule 5.33(a)(2) and (c)(1)-(3). --------------------------------------------------------------------------- Obsolete Foreign Currencies. The Exchange proposes to modify rule text relating to FLEX Options to remove obsolete references to foreign currencies that are no longer in circulation, which would add clarity and transparency to Exchange rules. Specifically, the Exchange proposes to remove references in the FLEX rules to Deutsche Marks and French Francs.\31\ --------------------------------------------------------------------------- \31\ See proposed Rules 5.30(b)(9), 5.32(e)(4), 5.33(g). --------------------------------------------------------------------------- FLEX Options Trading. The Exchange proposes to collapse the two separate current Rules 5.31(a) (Hours of Trading) and 5.31(b) (Trading Rotations) into a single proposed Rule 5.31, FLEX Option Trading, with the paragraphs (a) and (b) providing the same headings and substantive rule text, which would add internal consistency to the format of Exchange rules.\32\ --------------------------------------------------------------------------- \32\ See proposed Rule 5.31. The Exchange proposes two non- substantive revisions to existing rule text to add the word ``Options'' after ``FLEX'' and capitalizing the ``o'' in Options at the end of paragraph (a). Both changes would add clarity to Exchange rules by consistently referring to the defined term ``FLEX Options.'' See proposed Rule 5.31(a). --------------------------------------------------------------------------- [[Page 10426]] Terms of FLEX Options. The Exchange proposes to modify several aspects of Rule 5.32 (Terms of FLEX Options). First, the Exchange proposes to clarify that each FLEX Request for Quote and FLEX contract must contain the underlying security in the case of FLEX Equity Options or (rather than ``and'') underlying index, in the case of FLEX Index Options.\33\ The Exchange believes this change would add clarity and transparency to Exchange rules. --------------------------------------------------------------------------- \33\ See proposed Rule 5.32(b)(1). The Exchange also proposes to modify the punctuation Rule 5.32(b)(6) from a period to a semi-colon and to add the word ``and'' to add internal consistency to Exchange rules. --------------------------------------------------------------------------- Second, the Exchange proposes to modify Rule 5.32(b)(7) to make clear that the minimum size of one contract for FLEX Options applies to both transactions (per current rule text) ``and quotations'' (per proposed rule text). This proposed change corresponds to the Commission's approval, in 2014, of the Exchange's proposal to adopt on a permanent basis its pilot program regarding minimum value sizes for opening transactions in new series of FLEX Options and FLEX Quotes.\34\ The Exchange believes this change would add clarity and transparency to Exchange rules. --------------------------------------------------------------------------- \34\ See Securities and Exchange Act Release No. 72537 (July 3, 2014) 79 FR 39442 (July 10, 2014) (SR-NYSEArca-2014-25). In addition, the Exchange proposes to eliminate text from Rule 5.36(b)- (c) (Exercise Limits) that contradicts the approved one contract minimum size for FLEX transactions. --------------------------------------------------------------------------- The Exchange is proposing to modify Rule 5.32(f)(3) to address exercise settlement of FLEX Options that are FLEX ByRDs, as the current rule only addresses exercise settlement by physical delivery.\35\ Specifically, the Exchange proposes to designate the current description of exercise settlement by physical delivery as paragraph (3)(i) and to make clear this provisions applies solely to FLEX Equity Options other than FLEX ByRDs. Finally, the Exchange proposes paragraph (3)(ii) to state that exercise settlement and style of FLEX ByRDs would be the same as Non-FLEX ByRDs, pursuant to the VWAP settlement provision set forth in Rule 5.89 and pursuant to the European exercise style set forth in Rule 5.82(b)(1).'' \36\ --------------------------------------------------------------------------- \35\ Rule 5.32(f)(3) currently provides that ``[e]xercise settlement shall be by physical delivery of the underlying security or Exchange-Traded Fund Shares.'' \36\ See proposed Rule 5.32(f)(3)(i)-(ii). --------------------------------------------------------------------------- Finally, the Exchange also proposes to modify Commentary .01 to Rule 5.32, to provide that FLEX Options may be permitted in puts and calls that do not have identical terms, including, as proposed, ``the same settlement style.'' Commentary .01 to Rule 5.32 is designed to prevent the trading of a FLEX Option that has the exact same terms (underlying security, exercise style, expiration date, exercise price and, as proposed, settlement style) as a Standard or (non-FLEX) Option. In other words, as long as just one term of the FLEX Option is different from an existing ``regular'' or ``non-FLEX'' option it may be traded as a FLEX Option. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Securities Exchange Act of 1934 (the ``Act''),\37\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\38\ in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, 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. --------------------------------------------------------------------------- \37\ 15 U.S.C. 78f(b). \38\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange believes that the proposal to add FLEX ByRDs would remove impediments to and perfect the mechanism of a free and open market as FLEX ByRDs would enable market participants to negotiate terms that differ from standardized ByRDs, which would, in turn provide greater opportunities for investors to manage risk through the use of FLEX Options to the benefit of investors and the public interest. The Exchange notes that ByRDs are subject to heightened initial and continued listing standards and the settlement price based on an all- day VWAP, which should address any potential manipulation concerns.\39\ The Exchange believes that specifying that FLEX ByRDs can only be traded on ByRDs-eligible underlying securities that meet the same heightened initial and continued listing standards as ByRDs, thereby helping to ensure that only highly capitalized, actively traded stocks and ETFs will underlie cash-settled FLEX ByRDs, as well as requiring settlement based on all-day VWAP (as required for standardized ByRDs), should help to mitigate concerns about manipulation in the underlying security to benefit a position in FLEX ByRDs.\40\ --------------------------------------------------------------------------- \39\ See Securities Exchange Act Release No. 56251 (August 14, 2007), 72 FR 46523, 46524 (August 20, 2007) (SR-Amex-2004-27) (``ByRDs Order''). See also Securities Exchange Act Release No. 77044 (February 3, 2016), 81 FR 6908 (February 3, 2016) (SR-Arca- 2016-16) (immediate effectiveness filing adopting rules relating to ByRDs). \40\ See MKT Approval Order, supra note 12, 81 FR at 73457. --------------------------------------------------------------------------- The Exchange further believes that establishing position limits for FLEX ByRDs to be the same as Non-FLEX ByRDs position limits, which are currently 25,000 contracts on the same side of the market,\41\ and aggregating positions in Flex ByRDs with Non-FLEX ByRDs on the same or similar underlying security for purposes of calculating position limits is reasonable and consistent with the Act. In approving position limits for ByRDs, the Commission noted that these position limits appeared to reasonably balance the promotion of a free and open market for these securities with minimization of incentives for market manipulation.\42\ By establishing the same position limits for FLEX ByRDs as for Non-FLEX ByRDs and, importantly, aggregating such positions on the same side of the market,\43\ the Exchange similarly believes that the position limit requirements for FLEX ByRDs should help to ensure that the trading of FLEX ByRDs would not increase the potential for manipulation and could help to minimize such incentives. Moreover, as noted above, because FLEX ByRDs must, like standardized ByRDs, be cash settled, European- style exercise, with a settlement price based on an all-day VWAP (and meet heightened listing and continued listing standards), unlike other FLEX Options, the only non-standardized terms that can be flexed are strike prices and expiration dates. Further, the Exchange would surveil trading in FLEX ByRDs utilizing existing surveillance procedures pertaining to Non-FLEX ByRDs and FLEX Options. Finally, the Exchange notes that its proposal to offer FLEX ByRDs is consistent with the rules of another options exchange and therefore raise no novel issues for the Commission.\44\ --------------------------------------------------------------------------- \41\ The exercise limits for FLEX ByRDs will be equivalent to the position limits for FLEX ByRDs described in proposed Rule 5.35(b)(ii). See Rule 5.36. \42\ See ByRDs Order, supra note 39, 72 FR at 76525. \43\ For purposes of these position limits, long positions in ``Finish Low'' and short positions in ``Finish High'' ByRDs would be considered to be on the same side of the market; and short positions in ``Finish Low'' and long positions in ``Finish High'' ByRDs would be considered to be on the same side of the market. See proposed Rule 5.35 (b)(ii). \44\ See MKT Approval Order, supra note 12. --------------------------------------------------------------------------- The Exchange believes that the proposal to permit additional settlement types--Asian and Cliquet--would remove impediments to and perfect the [[Page 10427]] mechanism of a free and open market because the proposed rule change would provide OTP Holders with enhanced methods to manage risk by more finely tailoring a FLEX Option, within specified limits, to the underlying security or index through a variety of settlement calculations and styles. In addition, this proposal would promote just and equitable principles of trade and protect investors and the general public because the additional settlement styles for FLEX Options would provide investors with additional trading and hedging tools. The Exchange also believes that the Exchange's proposal to allow Asian and Cliquet style settlement for FLEX Index Options on Broad-Based Index Options may give investors and other market participants the ability to individually tailor, within specified limits, certain terms of those options. Furthermore, the Exchange believes that, since both Asian and Cliquet settlement styles depend on multiple measurements in determining the settlement value, both settlement styles could to help mitigate the potential for manipulation in the underlying security(ies). Further, the Exchange notes that its proposal to offer Asian and Cliquet-style settlement for FLEX Index Options is consistent with the rules of another options exchange and therefore raise no novel issues for the Commission.\45\ --------------------------------------------------------------------------- \45\ See supra note 13. --------------------------------------------------------------------------- The Exchange believes the proposed changes to FLEX Exercise Prices and Premiums would remove impediments to and perfect the mechanism of a free and open market as this change would provide greater flexibility in terms of describing an option contract tailored to the needs of the investor. In addition, the Exchange believes that the proposal to specify how exercise prices and premium for FLEX Index Options and FLEX Equity Options will be rounded and how they will be stated using a percentage-based methodology should provide greater clarity and allow market participants to specify contracts that meet their particular needs. In addition, the proposed changes would promote internal consistency in our own rules (including by removing a reference to fraction pricing to be consistent with the shift to decimal pricing found elsewhere in Exchange rules) and would align our rules with that of another options exchange and therefore raise no novel issues for the Commission.\46\ --------------------------------------------------------------------------- \46\ See supra note 20. --------------------------------------------------------------------------- Regarding the proposed settlement styles, the Exchange would use the same surveillance procedures currently utilized for the Exchange's other FLEX Options, including FLEX Index Options. The Exchange further represents that these surveillance procedures shall be adequate to monitor trading in options on these option products. For surveillance purposes, the Exchange would have complete access to information regarding trading activity in the pertinent underlying securities. The Exchange believes the proposal to provide that FLEX Officials, and not FLEX Market Makers, would be responsible for assuring that a Request for Quotes is submitted properly as a FLEX Option and for displaying the terms and specifications of the Request for Quotes would remove impediments to and perfect the mechanism of a free and open market as the regulatory oversight of FLEX transactions by a properly qualified FLEX Official could help to ensure that FLEX transactions comply with the FLEX rules. Finally, the remaining proposed changes to FLEX Options would remove impediments to and perfect the mechanism of a free and open market as the changes correct inaccuracies in rule text and update the rules to better reflect the Exchange's current practices with respect to FLEX Options, which have evolved over time. In particular, the Exchange believes that the proposed changes to refer to FLEX Requests for Quotes and FLEX Quotes as being disseminated and remove the concept of a post specific to the trading of FLEX options will align the rules with current trading practices on the Exchange's floor. The Exchange believes the proposed changes would provide transparency and internal consistency within Exchange rules and operate to protect investors and the investing public by making the Exchange rules easier to navigate and comprehend. 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. The proposal is designed to increase competition for order flow on the Exchange in a manner that is beneficial to investors because it is designed to provide investors seeking to effect FLEX Option orders with the opportunity for different methods of settling option contracts at expiration. The proposed changes are also designed to update Exchange rules regarding FLEX Options, including by removing obsolete references, which should likewise improve the competitiveness of the Exchange by making it a more attractive venue for trading. The Exchange notes that it operates in a highly competitive market in which market participants can readily direct order flow to competing venues who offer similar functionality. The Exchange also believes the proposed rule change promotes competition because it would enable the Exchange to provide market participants with FLEX Options transaction possibilities that are similar to that of other options exchanges. The Exchange believes the proposed rules encourage competition amongst market participants to provide tailored FLEX Options contracts. 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 Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act \47\ and Rule 19b-4(f)(6) thereunder.\48\ 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. --------------------------------------------------------------------------- \47\ 15 U.S.C. 78s(b)(3)(A)(iii). \48\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- At any time within 60 days of the filing of such 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 shall institute proceedings under Section 19(b)(2)(B) \49\ of the Act to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \49\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, [[Page 10428]] 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-NYSEArca-2017-02 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-NYSEArca-2017-02. 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-NYSEArca-2017-02, and should be submitted on or before March 3, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\50\ --------------------------------------------------------------------------- \50\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2017-02736 Filed 2-9-17; 8:45 am] BILLING CODE 8011-01-P
![10422 Federal Register / Vol. 82, No. 27 / Friday, February 10, 2017 / Notices
NYSEArca–2017–08 and should be of the most significant parts of such ByRDs shall be the same as Non-FLEX
submitted on or before March 3, 2017. statements. ByRDs, as set forth in Rule 5.86(a),
For the Commission, by the Division of except that positions in FLEX ByRDs
A. Self-Regulatory Organization’s
Trading and Markets, pursuant to delegated shall be aggregated with positions in
Statement of the Purpose of, and the
authority.22 Non-FLEX ByRDs on the same or similar
Statutory Basis for, the Proposed Rule
Robert W. Errett, underlying for the purpose of
Change
Deputy Secretary. calculating position limits.9 The
[FR Doc. 2017–02735 Filed 2–9–17; 8:45 am]
1. Purpose Exchange also proposes to include in
The purpose of this filing is to amend proposed Rule 5.35(b)(ii) that ‘‘[f]or
BILLING CODE 8011–01–P
certain rules related to FLEX Options, as purposes of the position limits
described below. established under this Rule, long
SECURITIES AND EXCHANGE FLEX Options are customized equity positions in ‘Finish Low’ and short
COMMISSION or index contracts that allow investors positions in ‘Finish High’ Binary Return
to tailor contract terms for exchange- Derivatives shall be considered to be on
[Release No. 34–79976; File No. SR– the same side of the market; and short
NYSEArca–2017–02]
listed equity and index options.4 The
Exchange is proposing to allow FLEX positions in ‘Finish Low’ and long
Options in ByRDs, make available positions in ‘Finish High’ Binary Return
Self-Regulatory Organizations; NYSE
additional settlement styles, modify Derivatives shall be considered to be on
Arca, Inc.; Notice of Filing and
how exercise prices and premiums are the same side of the market.’’ 10
Immediate Effectiveness of Proposed
expressed, change certain provisions Consistent with these changes, the
Rule Change To Amend Certain Rules
relating to floor-based trading, and Exchange also proposes to define Non-
Related to Flexible Exchange Options
modify other related provisions FLEX ByRDs as ‘‘a Non-FLEX Option
February 6, 2017. pertaining to FLEX Options. that is a Binary Return Derivatives
Pursuant to Section 19(b)(1) 1 of the contract,’’ in new paragraph (b)(22) to
Securities Exchange Act of 1934 FLEX Options for Binary Return Rule 5.30. The Exchange believes that
(‘‘Act’’) 2 and Rule 19b–4 thereunder,3 Derivatives Contracts (‘‘ByRDs’’) FLEX ByRDs would enable market
notice is hereby given that on January The Exchange proposes to modify its participants to negotiate terms that
25, 2017, NYSE Arca, Inc. (‘‘NYSE rules to enable market participants to differ from standardized ByRDs, which
Arca’’ or the ‘‘Exchange’’) filed with the trade FLEX options contracts in ByRDs.5 would, in turn, provide greater
Securities and Exchange Commission Specifically, the Exchange proposes to opportunities for investors to manage
(‘‘Commission’’) the proposed rule add a new definition of ‘‘FLEX ByRDs,’’ risk through the use of FLEX Options.11
change as described in Items I and II which would be a ‘‘Binary Return The Exchange notes that the proposed
below, which Items have been prepared Derivatives contract on any ByRD- rules related to FLEX ByRDs are
by the Exchange. The Commission is eligible underlying security that is materially identical to rules recently
publishing this notice to solicit subject to the rules in this Section.’’ 6 approved on another options
comments on the proposed rule change The Exchange also proposes to revise exchange.12
from interested persons. Rule 5.30(b)(15) to include FLEX ByRDs Additional Settlement Styles for FLEX
in the definition of ‘‘Series of FLEX Options: Asian and Cliquet Style
I. Self-Regulatory Organization’s Options.’’ 7 Because FLEX ByRDs would
Statement of the Terms of Substance of have to be settled in cash, based on the The Exchange proposes to permit
the Proposed Rule Change Volume-Weighted Average Price (or parties to FLEX Index Options on
The Exchange proposes to amend VWAP) of the underlying security, 9 The Exchange also proposes to re-format Rule
certain rules related to Flexible market participants could not modify 5.35 to make clear the position limits that apply to
Exchange (‘‘FLEX’’) Options. The these terms.8 However, market each of FLEX Index Options and FLEX Equity
proposed rule change is available on the participants may trade FLEX ByRDs Options. In this regard, the Exchange proposes to
Exchange’s Web site at www.nyse.com, with non-standard strike prices and/or modify the title of the Rule 5.35 to remove reference
to ‘‘Index’’ and re-titled it as ‘‘Position Limits for
at the principal office of the Exchange, non-standard expiration dates. FLEX Options.’’ Further, the Exchange proposes
and at the Commission’s Public Regarding position limits, the Exchange reformatting changes to clarify that Rule 5.35(a),
Reference Room. proposes to add paragraph (b)(ii) to Rule with proposed sub-parts (i) and (ii), refers to FLEX
Index Options and proposed Rule 5.35(b), refers to
II. Self-Regulatory Organization’s 5.35 to provide that positions in FLEX FLEX Equity Options. Finally, the Exchange
Statement of the Purpose of, and 4 See Rule 5.30(b)(4) (defining ‘‘FLEX option’’).
proposes to re-locate current paragraph (d) to Rule
Statutory Basis for, the Proposed Rule 5.35 regarding the aggregation of position limits for
See generally Section 4, Flexible Exchange Options, FLEX Index Options to proposed paragraph (a)(iii),
Change Rules 5.30–5.44. which would add clarity and consistency to
5 ByRDs are European-style option contracts on Exchange rules. See proposed Rule 5.35(a) and (b).
In its filing with the Commission, the
individual stocks, exchange-traded funds (‘‘ETFs’’) 10 See ‘‘Statutory Basis’’ section herein (in the
self-regulatory organization included and Index-Linked Securities that have a fixed return third paragraph) for further discussion.
statements concerning the purpose of, in cash based on a set strike price; satisfy specified 11 The Exchange also proposes to modify Rule
and basis for, the proposed rule change listing criteria; and may only be exercised at 5.32(f)(3)(ii) to provide that FLEX ByRDs must be
and discussed any comments it received expiration pursuant to the Rules of the Options settled the same as non-FLEX ByRDs. See proposed
Clearing Corporation (the ‘‘OCC’’). See Rules Rule 5.32(f)(3)(ii) (discussed herein under
on the proposed rule change. The text 5.82(b), 5.90. For a description of ‘‘Exchange- ‘‘Additional Updates to Reflect Trading in FLEX
of those statements may be examined at Traded Fund Shares’’ and ‘‘Index-Linked Options’’); see also Rule 5.89 (Determination of the
mstockstill on DSK3G9T082PROD with NOTICES
the places specified in Item IV below. Securities,’’ see also Rule 5.3(g) and (j). Settlement Price of ByRDs).
6 See proposed Rule 5.30(b)(19).
The Exchange has prepared summaries, 12 See Securities Exchange Act Release Nos.
7 See proposed Rule 5.30(b)(15) (proposing to add
set forth in sections A, B, and C below, 79125 (October 19, 2016), 81 FR 73452 (October 25,
that a ‘‘Series of FLEX Options’’ would include, in 2016) (‘‘MKT Approval Order ’’) (order approving
the case of FLEX ByRDs, all such option contracts modifications to FLEX Options, including adding
22 17 CFR 200.30–3(a)(12). of the same class having the same expiration date, FLEX ByRDs); 78348 (July 15, 2016), 81 FR 47469
1 15 U.S.C. 78s(b)(1). strike price, and exercise settlement amount). (July 21, 2016) (‘‘MKT Notice’’) (SR–NYSEMKT–
2 15 U.S.C. 78a. 8 See ‘‘Statutory Basis’’ section herein (in the 2016–48). See also NYSE MKT Rules
3 17 CFR 240.19b–4. second paragraph) for further discussion. 900G(b)(16),(17), (22); 903G(c)(3)(i)–(ii); 906G(b)(ii).
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![10424 Federal Register / Vol. 82, No. 27 / Friday, February 10, 2017 / Notices
options so that if the sum of the initial reference value, which would be The exercise settlement value for
monthly returns is negative, a Cliquet the closing value of the underlying Cliquet options would be equal to the
option would expire worthless. broad-based index on the date a new initial reference price of the underlying
Unlike other options, Cliquet options Cliquet option is listed. The time period broad-based index multiplied by the
would not have a traditional exercise measured for the first ‘‘monthly’’ return sum of the monthly returns (with the
(strike) price. Rather, the exercise would be between the initial listing date cap applied) on the 12 consecutive
(strike) price field for a Cliquet option and the first monthly observation date. monthly observation dates, which
would represent the designated capped For example, if a Cliquet option was include the expiration date of the
monthly return for the contract and opened on January 1 and the parties option, provided that the sum is greater
would be expressed in dollars and designated the 31st of each month as the than 0. If the sum of the monthly returns
cents. For example, a capped monthly monthly observation date, the
return of 2.25% would be represented (with the applied cap) is 0 or a less, the
measurement period for the first option would expire worthless.
by the dollar amount of $2.25. The monthly return would span the time
‘‘strike’’ price for a Cliquet option may period from January 1 to January 31. An example of a Cliquet option
only be expressed in a dollar and cents The time period measured for the follows. On January 21, 2015, an
amount and the ‘‘strike’’ price for a second monthly return, and all investor hedging the value of the S&P
Cliquet option may only span a range 500 Index over a year purchases a
subsequent monthly returns, would run
between $0.05 and $25.95. In addition, Cliquet FLEX call option expiring on
from the 31st of one month to the 31st
the ‘‘strike’’ price for a Cliquet option January 22, 2016 with a capped monthly
of the next month (or the last Exchange
may only be designated in $0.05 return of 2% and a contract multiplier
business day of each month depending
increments, e.g., $1.75, $2.50, $4.15. of $100. The initial reference price of
Increments of $0.01 in the ‘‘strike’’ price on the actual number of calendar days
in each month covered by the contract). the S&P 500 Index (closing value) on
field (representing the capped monthly January 21, 2015 is 2000. The option has
return) would not be permitted. Cliquet options would have
monthly observation dates occurring on
The first ‘‘monthly’’ return for a European-style exercise and may not be
Cliquet option would be based on the exercised prior to the expiration date. the 23rd of each month.
Capped
S&P 500 Actual Sum of
monthly
Monthly observation date index closing monthly monthly
return
value (Si) return % returns %
(CMRi) %
23-Feb-15 ........................................................................................................ 2025.36 1.27 1.27 1.27
23-Mar-15 ........................................................................................................ 2049.34 1.18 1.18 2.45
23-Apr-15 ......................................................................................................... 2019.77 ¥1.44 ¥1.44 1.01
22-May-15* ...................................................................................................... 1989.65 ¥1.49 ¥1.49 ¥0.48
23-Jun-15 ......................................................................................................... 2005.64 0.80 0.80 0.32
23-Jul-15 .......................................................................................................... 2035.10 1.47 1.47 1.79
21-Aug-15* ....................................................................................................... 2032.15 ¥0.14 ¥0.14 1.65
23-Sep-15 ........................................................................................................ 2076.18 2.17 **2.00 3.65
23-Oct-15 ......................................................................................................... 2099.01 1.10 1.10 4.75
23-Nov-15 ........................................................................................................ 2109.32 0.49 0.49 5.24
23-Dec-15 ........................................................................................................ 2085.42 ¥1.13 ¥1.13 4.11
22-Jan-16 ......................................................................................................... 2084.81 ¥0.03 ¥0.03 4.08
Exercise Settlement Value .............................................................................. [(4.08% * 2000.00)] + 2 = 83.60
* Because Cliquet FLEX options use the ‘‘preceding business day convention,’’ the dates of May 23, 2015, and August 23, 2015, were not
used in the above example because those dates fall on a weekend or a holiday. Instead the business days immediately preceding those dates
were used as the monthly observation dates.
** Monthly capped return applied.
The exercise settlement amount for have been already substantively applied Options.18 The Exchange further
this January 22, 2016 Cliquet option, to determine the exercise settlement represents that these surveillance
with a capped monthly 2% return value, the ‘‘strike price’’ of 2.0 would be procedures will be adequate to monitor
(‘‘strike price’’) and a contract multiplier subtracted from the exercise settlement trading in these option products. For
of $100 would be equal to $8,360. This value before the contract multiplier surveillance purposes, the Exchange
value would be calculated by summing ($100) would be applied [(83.60—2) * would have access to information
the monthly capped returns (equal to 100]. Accordingly, resulting payout for regarding trading activity in the
4.08%) and multiplying that amount by this contract would be $8,160. pertinent underlying securities.
the initial reference price (equal to If the sum of the monthly capped FLEX Exercise Prices and Premiums
2000), which equals 81.60. The ‘‘strike
returns had been negative, this option
price’’ (2%) amount would then be The Exchange also proposes to modify
would have expired worthless.
added to that amount (81.60) to arrive
mstockstill on DSK3G9T082PROD with NOTICES
how exercise prices and premiums for
at an exercise settlement value of 83.60. Regarding the proposed settlement FLEX Options may be expressed, which
Because the ‘‘strike price’’ field for a styles, the Exchange would use the same would reflect recent changes in the
Cliquet option would be the manner in surveillance procedures currently marketplace. The Exchange notes that
which the designated capped monthly utilized for the Exchange’s other FLEX when it adopted rules for FLEX Options,
return would be identified for the Options, including FLEX Index
contract and because the designated 18 See ‘‘Statutory Basis’’ section herein (in the
monthly return for the contract would fourth paragraph) for further discussion.
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![Federal Register / Vol. 82, No. 27 / Friday, February 10, 2017 / Notices 10425
strike prices were designated in one- • ‘‘FLEX’’ Options. The Exchange Official, or any other designated
eighth of a dollar, and options were proposes to define ‘‘FLEX’’ as shorthand qualified employees called in to assist
priced in fractions of a dollar.19 Now for Flexible Options in the title of the FLEX Official, are properly qualified
that decimalization has been applied to Section 4.23 and meet any necessary requirements.27
options trading, including trading in • Flex Post Official. The Exchange The Exchange believes the regulatory
FLEX Options, certain exchange rules proposes to modify the name of ‘‘FLEX oversight of FLEX transactions by a
have been revised to reflect the decimal Post Official’’ to eliminate ‘‘Post’’ from properly qualified FLEX Official could
equivalent of a previously approved the title to more accurately reflect the help to ensure that FLEX transactions
fractional term. Thus, the Exchange position.24 When the Exchange first comply with the FLEX rules.28 The
proposes to collapse current Rules began trading FLEX Options, it proposal to replace certain duties of a
5.32(f)(2) and (f)(5) into a revised Rule designated FLEX Post Officials to refer FLEX Market Maker with respect to
5.32(f)(2), to provide that exercise prices to specially qualified Trading Officials FLEX Options transactions with duties
and premiums may be stated in terms stationed at specific FLEX posts to assigned to a FLEX Official, who is an
of: address the nuances related to those Exchange employee, is consistent with
(i) A dollar amount; (ii) a method for products (e.g., the method for the FLEX rules of other exchanges.29
fixing such a number at the time a FLEX announcing a Request for Quotes and Second, consistent with the foregoing
Request for Quote or FLEX Order is appointing FLEX Qualified Market changes, the Exchange proposes to
traded; or (iii) a percentage of the price Makers). However, as trading in FLEX modify Rule 5.33(a)(2) and (c)(1)–(3) to
of the underlying security at the time of Options gained popularity, it became more accurately reflect the handling of
the trade or as of the close of trading on apparent that liquidity for FLEX FLEX Quotes and requests for such
the Exchange on the trade date. Options was more readily available at quotes. When the Exchange introduced
The Exchange notes that this change trading posts where the standard FLEX Options, the Exchange displayed
would align with the Exchange’s options in the underlying security FLEX Request for Quotes and FLEX
treatment of FLEX Index Options as traded rather than at a specific FLEX Quotes at the FLEX post. However, over
well as the rules of other exchanges.20 post. Thus, the Exchange proposes to time, Floor Participants would ask Floor
In addition, the Exchange proposes to change the name of ‘‘FLEX Post Brokers to communicate the existence of
modify Rule 5.32 by adding new Official’’ in Rules 5.30(b)(7) and 5.38 to trading interest in particular FLEX
paragraph (e)(2)(C) and modifying eliminate the reference to physical Options through various means to their
paragraph (f)(2) to provide that: FLEX posts and to refer simply to customers and correspondents. Thus,
Exercise prices may be rounded to the ‘‘FLEX Officials’’, which would better the Exchange proposes to revise the
nearest minimum tick or other decimal reflect the realities of trading FLEX rules to reflect that the FLEX Request for
increment determined by the Exchange on a Options on the Exchange and clarify Quotes or the FLEX Quotes are
class-by-class basis that may not be smaller and add transparency to Exchange ‘‘disseminated’’ (rather than displayed),
than $0.01. Premiums will be rounded to the rules.25 which would add clarity and
nearest minimum tick. For exercise prices • FLEX Trading Procedures and transparency to Exchange rules.30
and premiums stated using a percentage- Principles. The Exchange proposes to • Obsolete Foreign Currencies. The
based methodology, such values may be modify Rule 5.33 (FLEX Trading Exchange proposes to modify rule text
stated in a percentage increment determined relating to FLEX Options to remove
Procedures and Principles) to likewise
by the Exchange on a class-by-class basis that
may not be smaller than 0.01% and will be update the rule text to accurately reflect obsolete references to foreign currencies
rounded as provided above.21 trading in FLEX Options. First, the that are no longer in circulation, which
Exchange proposes to modify would add clarity and transparency to
The Exchange notes that this paragraphs (a)(1) and (2) of Rule 5.33, Exchange rules. Specifically, the
proposed change is consistent with the which provide that FLEX Market Exchange proposes to remove references
rules of another options exchange.22 Makers handle Requests for Quotes from in the FLEX rules to Deutsche Marks
The Exchange believes this change OTP Holders and OTP Firms when, [sic] and French Francs.31
would provide greater flexibility in to more appropriately reflect that FLEX • FLEX Options Trading. The
terms of describing an option contract Officials conduct this work on the Exchange proposes to collapse the two
tailored to the needs of the investor. Exchange. Thus, the Exchange proposes separate current Rules 5.31(a) (Hours of
Additional Updates To Reflect Trading to replace references to FLEX Market Trading) and 5.31(b) (Trading Rotations)
in FLEX Options Maker with FLEX Official in Rule into a single proposed Rule 5.31, FLEX
5.33(a)(1)–(2).26 The Exchange notes Option Trading, with the paragraphs (a)
The Exchange is also proposing the and (b) providing the same headings
following modifications to streamline that FLEX Officials are Exchange
employees that report to the regulatory and substantive rule text, which would
and update FLEX Options Rules: add internal consistency to the format of
officer of the Exchange. As such, the
19 See Rule 5.32(f)(2) (providing that exercise Exchange would ensure that each FLEX Exchange rules.32
prices may be rounded to the nearest .10 or one-
27 See proposed Rule 5.38 (detailing duties of
eighth of a dollar) and (f)(5) (providing that exercise 23 See proposed Section 4 (Flexible Exchange
prices may be rounded to the nearest .10). (‘‘FLEX’’) Options). The Exchange also proposes to Exchange employees designated to act as FLEX
20 See, e.g., Rule 5.32(e)(2); CBOE Rule revise Rule 5.30(b)(2) to remove an errant semi- Officials).
28 See id.
24A.4(b)(2) and (c)(2); NYSE MKT Rules 903G(b)(1), colon from the term ‘‘BBO Improvement Interval.’’
29 See, e.g., CBOE Rule 24A.5(a)(i) and (ii),
(c)(2). 24 See proposed Rule 5.30(b)(7) and 5.38.
21 See proposed Rule 5.32(e)(2)(C) and (f)(2). The 25 See proposed Rules 5.30(b)(7), 5.37(c), and 24A.12(b) ; MKT Rule 900G(21) and 910G [sic].
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30 See proposed Rule 5.33(a)(2) and (c)(1)–(3).
proposed rule removes reference to exercise prices 5.38. Similarly, because there are no longer physical
being rounded to the nearest tenth or one-eighth of posts on the Trading Floor that are solely ‘‘FLEX 31 See proposed Rules 5.30(b)(9), 5.32(e)(4),
a dollar. See id. posts,’’ the Exchange proposes to remove the FLEX 5.33(g).
22 See, e.g., CBOE Rule 24A.4(b)(2) (permitting modifier from Rule 5.33(b)(1) and Rule 6.78(e)(1)(C) 32 See proposed Rule 5.31. The Exchange
bids and offers, strikes and premiums to be and (E) (Transactions Off the Exchange), such that proposes two non-substantive revisions to existing
expressed in increments determined by the the revised rule text refers only to a ‘‘post.’’ See rule text to add the word ‘‘Options’’ after ‘‘FLEX’’
Exchange, which increments may be no smaller proposed Rules 5.33(b)(1) and 6.78(e)(1)(C), (E). and capitalizing the ‘‘o’’ in Options at the end of
than $0.01). See also NYSE MKT Rules 903G(b)(1), 26 The Exchange notes that reference to FLEX paragraph (a). Both changes would add clarity to
(c)(2). Official is consistent with proposed Rule 5.30(b)(7). Continued
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![10426 Federal Register / Vol. 82, No. 27 / Friday, February 10, 2017 / Notices
• Terms of FLEX Options. The permitted in puts and calls that do not concerns about manipulation in the
Exchange proposes to modify several have identical terms, including, as underlying security to benefit a position
aspects of Rule 5.32 (Terms of FLEX proposed, ‘‘the same settlement style.’’ in FLEX ByRDs.40
Options). First, the Exchange proposes Commentary .01 to Rule 5.32 is The Exchange further believes that
to clarify that each FLEX Request for designed to prevent the trading of a establishing position limits for FLEX
Quote and FLEX contract must contain FLEX Option that has the exact same ByRDs to be the same as Non-FLEX
the underlying security in the case of terms (underlying security, exercise ByRDs position limits, which are
FLEX Equity Options or (rather than style, expiration date, exercise price currently 25,000 contracts on the same
‘‘and’’) underlying index, in the case of and, as proposed, settlement style) as a side of the market,41 and aggregating
FLEX Index Options.33 The Exchange Standard or (non-FLEX) Option. In other positions in Flex ByRDs with Non-FLEX
believes this change would add clarity words, as long as just one term of the ByRDs on the same or similar
and transparency to Exchange rules. FLEX Option is different from an underlying security for purposes of
Second, the Exchange proposes to existing ‘‘regular’’ or ‘‘non-FLEX’’ calculating position limits is reasonable
modify Rule 5.32(b)(7) to make clear option it may be traded as a FLEX and consistent with the Act. In
that the minimum size of one contract Option. approving position limits for ByRDs, the
for FLEX Options applies to both Commission noted that these position
transactions (per current rule text) ‘‘and 2. Statutory Basis
limits appeared to reasonably balance
quotations’’ (per proposed rule text). The Exchange believes that its the promotion of a free and open market
This proposed change corresponds to proposal is consistent with Section 6(b) for these securities with minimization of
the Commission’s approval, in 2014, of of the Securities Exchange Act of 1934 incentives for market manipulation.42
the Exchange’s proposal to adopt on a (the ‘‘Act’’),37 in general, and furthers By establishing the same position limits
permanent basis its pilot program the objectives of Section 6(b)(5) of the for FLEX ByRDs as for Non-FLEX ByRDs
regarding minimum value sizes for Act,38 in particular, in that it is designed and, importantly, aggregating such
opening transactions in new series of to prevent fraudulent and manipulative positions on the same side of the
FLEX Options and FLEX Quotes.34 The acts and practices, to promote just and market,43 the Exchange similarly
Exchange believes this change would equitable principles of trade, to remove believes that the position limit
add clarity and transparency to impediments to and perfect the requirements for FLEX ByRDs should
Exchange rules. mechanism of a free and open market help to ensure that the trading of FLEX
The Exchange is proposing to modify and a national market system, and, in ByRDs would not increase the potential
Rule 5.32(f)(3) to address exercise general, to protect investors and the for manipulation and could help to
settlement of FLEX Options that are public interest. minimize such incentives. Moreover, as
FLEX ByRDs, as the current rule only The Exchange believes that the noted above, because FLEX ByRDs
addresses exercise settlement by proposal to add FLEX ByRDs would must, like standardized ByRDs, be cash
physical delivery.35 Specifically, the remove impediments to and perfect the settled, European-style exercise, with a
Exchange proposes to designate the mechanism of a free and open market as settlement price based on an all-day
current description of exercise FLEX ByRDs would enable market VWAP (and meet heightened listing and
settlement by physical delivery as participants to negotiate terms that continued listing standards), unlike
paragraph (3)(i) and to make clear this differ from standardized ByRDs, which other FLEX Options, the only non-
provisions applies solely to FLEX would, in turn provide greater standardized terms that can be flexed
Equity Options other than FLEX ByRDs. opportunities for investors to manage are strike prices and expiration dates.
Finally, the Exchange proposes risk through the use of FLEX Options to Further, the Exchange would surveil
paragraph (3)(ii) to state that exercise the benefit of investors and the public trading in FLEX ByRDs utilizing
settlement and style of FLEX ByRDs interest. The Exchange notes that ByRDs existing surveillance procedures
would be the same as Non-FLEX ByRDs, are subject to heightened initial and pertaining to Non-FLEX ByRDs and
pursuant to the VWAP settlement continued listing standards and the FLEX Options. Finally, the Exchange
provision set forth in Rule 5.89 and settlement price based on an all-day notes that its proposal to offer FLEX
pursuant to the European exercise style VWAP, which should address any ByRDs is consistent with the rules of
set forth in Rule 5.82(b)(1).’’ 36 potential manipulation concerns.39 The another options exchange and therefore
Finally, the Exchange also proposes to Exchange believes that specifying that raise no novel issues for the
modify Commentary .01 to Rule 5.32, to FLEX ByRDs can only be traded on Commission.44
provide that FLEX Options may be ByRDs-eligible underlying securities The Exchange believes that the
that meet the same heightened initial proposal to permit additional settlement
Exchange rules by consistently referring to the and continued listing standards as types—Asian and Cliquet—would
defined term ‘‘FLEX Options.’’ See proposed Rule ByRDs, thereby helping to ensure that
5.31(a). remove impediments to and perfect the
33 See proposed Rule 5.32(b)(1). The Exchange
only highly capitalized, actively traded
also proposes to modify the punctuation Rule stocks and ETFs will underlie cash- 40 See MKT Approval Order, supra note 12, 81 FR
5.32(b)(6) from a period to a semi-colon and to add settled FLEX ByRDs, as well as at 73457.
the word ‘‘and’’ to add internal consistency to requiring settlement based on all-day 41 The exercise limits for FLEX ByRDs will be
Exchange rules. equivalent to the position limits for FLEX ByRDs
34 See Securities and Exchange Act Release No.
VWAP (as required for standardized described in proposed Rule 5.35(b)(ii). See Rule
72537 (July 3, 2014) 79 FR 39442 (July 10, 2014) ByRDs), should help to mitigate 5.36.
(SR–NYSEArca–2014–25). In addition, the 42 See ByRDs Order, supra note 39, 72 FR at
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Exchange proposes to eliminate text from Rule 37 15 U.S.C. 78f(b). 76525.
5.36(b)–(c) (Exercise Limits) that contradicts the 38 15 U.S.C. 78f(b)(5). 43 For purposes of these position limits, long
approved one contract minimum size for FLEX 39 See Securities Exchange Act Release No. 56251 positions in ‘‘Finish Low’’ and short positions in
transactions. (August 14, 2007), 72 FR 46523, 46524 (August 20, ‘‘Finish High’’ ByRDs would be considered to be on
35 Rule 5.32(f)(3) currently provides that the same side of the market; and short positions in
2007) (SR–Amex–2004–27) (‘‘ByRDs Order’’). See
‘‘[e]xercise settlement shall be by physical delivery also Securities Exchange Act Release No. 77044 ‘‘Finish Low’’ and long positions in ‘‘Finish High’’
of the underlying security or Exchange-Traded (February 3, 2016), 81 FR 6908 (February 3, 2016) ByRDs would be considered to be on the same side
Fund Shares.’’ (SR–Arca–2016–16) (immediate effectiveness filing of the market. See proposed Rule 5.35 (b)(ii).
36 See proposed Rule 5.32(f)(3)(i)–(ii). adopting rules relating to ByRDs). 44 See MKT Approval Order, supra note 12.
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![10428 Federal Register / Vol. 82, No. 27 / Friday, February 10, 2017 / Notices
including whether the proposed rule SECURITIES AND EXCHANGE effects of issuing a Presidential Permit
change is consistent with the Act. COMMISSION authorizing an increase in flow of liquid
Comments may be submitted by any of hydrocarbons through the Line 67
the following methods: Sunshine Act Meeting pipeline border segment. The Draft SEIS
was prepared consistent with the
Electronic Comments Notice is hereby given, pursuant to
National Environmental Policy Act
the provisions of the Government in the
• Use the Commission’s Internet (NEPA) of 1969 (42 United States Code
Sunshine Act, Public Law 94–409, that
comment form (http://www.sec.gov/ [U.S.C.] Section 4321, et seq.), the
the Securities and Exchange
rules/sro.shtml); or regulations of the Council on
Commission Advisory Committee on
Environmental Quality (CEQ) (40 Code
• Send an email to rule-comments@ Small and Emerging Companies will
of Federal Regulations [CFR] 1500–
sec.gov. Please include File Number SR– hold a public meeting on Wednesday,
1508), and the Department’s NEPA
NYSEArca–2017–02 on the subject line. February 15, in Multi-Purpose Room
implementing regulations (22 CFR part
LL–006 at the Commission’s
Paper Comments 161).
headquarters, 100 F Street NE.,
Washington, DC. DATES: The Department invites U.S.
• Send paper comments in triplicate agencies, organizations, tribal
to Brent J. Fields, Secretary, Securities The meeting will begin at 9:30 a.m.
(ET) and will be open to the public. governments, and members of the
and Exchange Commission, 100 F Street public to submit comments to assist the
NE., Washington, DC 20549–1090. Seating will be on a first-come, first-
served basis. Doors will open at 9:00 Department in identifying
All submissions should refer to File a.m. Visitors will be subject to security environmental and other relevant
Number SR–NYSEArca–2017–02. This checks. The meeting will be webcast on issues, any measures that might be
file number should be included on the the Commission’s Web site at adopted to reduce the proposed
subject line if email is used. To help the www.sec.gov. Project’s environmental impacts, and
Commission process and review your On January 30, 2017, the Commission other information relevant to the Draft
comments more efficiently, please use published notice of the Committee SEIS. The 45-day public comment
only one method. The Commission will meeting (Release No. 33–10292), period begins with the publication of
post all comments on the Commission’s indicating that the meeting is open to this Notice on February 10, 2017 and
Internet Web site (http://www.sec.gov/ the public and inviting the public to ends on March 27, 2017. Comments
rules/sro.shtml). Copies of the submit written comments to the submitted electronically through
submission, all subsequent Committee. This Sunshine Act notice is www.regulations.gov as described below
amendments, all written statements being issued because a majority of the are strongly encouraged, but all
with respect to the proposed rule Commission may attend the meeting. comments will be given equal weight.
change that are filed with the The agenda for the meeting includes The Department will consider
Commission, and all written matters relating to rules and regulations comments received or postmarked by
communications relating to the affecting small and emerging companies March 27, 2017.
proposed rule change between the under the federal securities laws. All comments received during the
Commission and any person, other than For further information, please public comment period may be made
those that may be withheld from the contact Brent J. Fields from the Office of public, no matter how initially
public in accordance with the the Secretary at (202) 551–5400. submitted. Comments are not private
provisions of 5 U.S.C. 552, will be and will not be edited to remove
Dated: February 8, 2017. identifying or contact information. The
available for Web site viewing and
Brent J. Fields, Department cautions commenters
printing in the Commission’s Public
Reference Room, 100 F Street NE., Secretary. against including any information that
Washington, DC 20549 on official [FR Doc. 2017–02906 Filed 2–8–17; 4:15 pm] they would not want publicly disclosed.
business days between the hours of BILLING CODE 8011–01–P The Department further requests that
10:00 a.m. and 3:00 p.m. Copies of such any party soliciting or aggregating
filing also will be available for comments from other persons direct
inspection and copying at the principal DEPARTMENT OF STATE those persons not to include any
office of the Exchange. All comments identifying or contact information, or
[Public Notice 9880] information they would not want
received will be posted without change;
the Commission does not edit personal publicly disclosed, in their comments.
Notice of Availability of the Draft The Department will hold a public
identifying information from Supplemental Environmental Impact
submissions. You should submit only meeting on Tuesday March 7, 2017 at
Statement (SEIS) for the Proposed the Sanford Center, 1111 Event Center
information that you wish to make Enbridge Energy, Limited Partnership
available publicly. All submissions Drive NE., Bemidji, Minnesota from 4:30
Line 67 Expansion Project and to 7:30 p.m.
should refer to File Number SR– Announcement of a Public Meeting
NYSEArca–2017–02, and should be ADDRESSES: Parties may submit
submitted on or before March 3, 2017. Department of State.
AGENCY: comments at http://www.regulations.gov
Notice; solicitation of
ACTION: by entering the ‘‘Enbridge Line 67’’ into
For the Commission, by the Division of
Trading and Markets, pursuant to delegated comments. the search field and following the
prompts. Written comments should be
mstockstill on DSK3G9T082PROD with NOTICES
authority.50
SUMMARY: The U.S. Department of State addressed to: Ms. Mary D. Hassell, U.S.
Robert W. Errett,
(Department) announces availability for Department of State, 2201 C Street NW.,
Deputy Secretary. the public review and comment of the Room 2727, Washington, DC 20520. As
[FR Doc. 2017–02736 Filed 2–9–17; 8:45 am] Draft Supplemental Environmental described above, comments are not
BILLING CODE 8011–01–P Impact Statement for the Line 67 private. All comments from agencies or
Expansion (Draft SEIS). This document organizations should indicate a contact
50 17 CFR 200.30–3(a)(12). analyzes the potential environmental person for the agency or organization.
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Document Created: 2017-02-11 18:15:09
Document Modified: 2017-02-11 18:15:09
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