82_FR_17997 82 FR 17927 - Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX PEARL Fee Schedule

82 FR 17927 - Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX PEARL Fee Schedule

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 70 (April 13, 2017)

Page Range17927-17929
FR Document2017-07458

Federal Register, Volume 82 Issue 70 (Thursday, April 13, 2017)
[Federal Register Volume 82, Number 70 (Thursday, April 13, 2017)]
[Notices]
[Pages 17927-17929]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-07458]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80401; File No. SR-PEARL-2017-17]


Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX 
PEARL Fee Schedule

April 7, 2017.
    Pursuant to the provisions of 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 April 6, 2017, MIAX PEARL, LLC (``MIAX PEARL'' 
or ``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') a proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the Exchange. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange is filing a proposal to amend the MIAX PEARL Fee 
Schedule (the ``Fee Schedule'') to waive transaction rebates/fees 
applicable to transactions executed during the opening and transactions 
that uncross the Away Best Bid or Offer (``ABBO'').
    The Exchange initially filed the proposal on March 29, 2017 (SR-
PEARL-2017-13). That filing has been withdrawn and replaced with the 
current filing (SR-PEARL-2017-17).
    The text of the proposed rule change is available on the Exchange's 
Web site at http://www.miaxoptions.com/rule-filings/pearl, at MIAX 
PEARL's principal office, 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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this proposed rule change is to waive transaction 
rebates/fees applicable to executions that occur as part of the 
Exchange's opening procedures as described in Rule 503 (``Openings on 
the Exchange'') or that uncross the ABBO,\3\ as described in Rule 515 
(``Execution of Orders'').
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    \3\ See MIAX PEARL Rule 100.
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    Under the Openings on the Exchange Rule, the Exchange will accept 
orders for queuing in a series of options prior to the opening of 
trading in that series of options. As such and as further described in 
Rule 503, executions might occur in a series as part of the Exchange 
Opening as the series is being opened for trading. Pursuant to Section 
1)a) of the Exchange's Fee Schedule, the Exchange currently assesses 
transaction rebates and fees for transactions that occur as part of the 
Exchange Opening. In order to determine the applicable transaction 
rebate and fee, the Exchange treats orders from Priority Customer \4\ 
origin type as a ``Maker,'' and treats orders from all origin types 
other than Priority Customer (i.e., MIAX PEARL Market Maker \5\ and 
Non-Priority Customer, Firm, BD and Non-MIAX PEARL Market Maker) \6\ as 
a ``Taker.'' The Exchange now proposes that, for executions occurring 
as part of the Exchange Opening, the Exchange will neither charge a fee 
nor provide a rebate, regardless of origin type.
---------------------------------------------------------------------------

    \4\ The term ``Priority Customer'' is defined in Exchange Rule 
100 to mean a person or entity that (i) is not a broker or dealer in 
securities, and (ii) does not place more than 390 orders in listed 
options per day on average during a calendar month for its own 
beneficial accounts(s). The number of orders is counted in 
accordance with Rule 100 Interpretation and Policy .01.
    \5\ The term ``Market Maker'' is defined in Exchange Rule 100 to 
mean a Member registered with the Exchange for the purpose of making 
markets in options contracts traded on the Exchange and that is 
vested with the rights and responsibilities specified in Chapter VI 
of the Exchange's Rules.
    \6\ See MIAX PEARL Fee Schedule, Section 1(a).
---------------------------------------------------------------------------

    Further, pursuant to Section 1)a) of the Exchange's Fee Schedule, 
the Exchange currently assesses transaction rebates and fees for 
transactions that uncross the ABBO. In order to

[[Page 17928]]

determine the applicable transaction rebate and fee, the Exchange 
treats orders from Priority Customer origin type as a ``Maker,'' and 
treats orders from all origin types other than Priority Customer as a 
``Taker.'' The Exchange now proposes that, for executions occurring in 
such scenario, the Exchange will neither charge a fee nor provide a 
rebate, regardless of origin type.
    The Exchange has determined to make these changes for competitive 
reasons in order to attract more order flow to the Exchange in these 
scenarios. The Exchange notes that other exchanges do not assess 
transaction rebates/fees in these scenarios, including Bats BZX 
Exchange.\7\ The Exchange notes that any contracts executed as a result 
of such transactions will continue to be counted for purposes of 
determining the volume criteria and TCV \8\ for purposes of calculating 
tiered rebates and fees.
---------------------------------------------------------------------------

    \7\ See Securities Exchange Act Release No. 71746 (March 19, 
2014), 79 FR 16412 (March 25, 2014) (SR-BATS-2014-006).
    \8\ TCV means total consolidated volume calculated as the total 
national volume in those classes listed on MIAX PEARL for the month 
for which the fees apply, excluding consolidated volume executed 
during the period time in which the Exchange experiences an outage 
of a Matching Engine or collective Matching Engines for a period of 
two consecutive hours or more, during trading hours (solely in the 
option classes of the affected Matching Engine). See Fee Schedule 
Definitions.
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2. Statutory Basis
    The Exchange believes that its proposal to amend its fee schedule 
is consistent with Section 6(b) of the Act \9\ in general, and furthers 
the objectives of Section 6(b)(4) of the Act \10\ in particular, in 
that it is an equitable allocation of reasonable dues, fees and other 
charges among its members and issuers and other persons using its 
facilities. The Exchange also believes the proposal furthers the 
objectives of Section 6(b)(5) of the Act in that it is designed to 
promote just and equitable principles of trade, to remove impediments 
to and perfect the mechanism of a free and open market and a national 
market system, and, in general to protect investors and the public 
interest and is not designed to permit unfair discrimination between 
customers, issuers, brokers and dealers.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    The proposal provides that executions that occur as part of the 
Exchange Opening will not incur any fees or receive any rebates, 
regardless of origin type. The Exchange believes that its proposal to 
waive transaction rebates/fees that occur as part of the Exchange 
Opening is reasonable, fair and equitable because it will incentivize 
Members \11\ to send greater order flow to the Exchange in this 
scenario, potentially providing greater liquidity on the Exchange. In 
addition, the Exchange believes that the foregoing is fair and 
equitable because it provides certainty for Members with respect to 
execution costs across all trades occurring as part of the Exchange 
Opening. Lastly, the Exchange also believes that the proposed pricing 
for executions occurring as part of the Opening on the Exchange is 
nondiscriminatory because it will apply equally to all Members, 
regardless of origin type.
---------------------------------------------------------------------------

    \11\ ``Member'' means an individual or organization that is 
registered with the Exchange pursuant to Chapter II of the Exchange 
Rules for purposes of trading on the Exchange as an ``Electronic 
Exchange Member'' or ``Market Maker.'' Members are deemed 
``members'' under the Exchange Act. See MIAX PEARL Rule 100.
---------------------------------------------------------------------------

    The proposal further provides that executions that uncross the ABBO 
will not be assessed any fees or receive any rebates, regardless of 
origin type. The Exchange believes that its proposal to waive 
transaction rebates/fees that uncross the ABBO is reasonable, fair and 
equitable because it will incentivize Members to send greater order 
flow to the Exchange in this scenario, potentially providing greater 
liquidity on the Exchange. In addition, the Exchange believes that the 
foregoing is fair and equitable because it provides certainty for 
Members with respect to execution costs across all trades which uncross 
the ABBO. Lastly, the Exchange also believes that the proposed pricing 
for executions occurring in this scenario is nondiscriminatory because 
it will apply equally to all Members, regardless of origin type.

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

    MIAX PEARL does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. To the contrary, the Exchange 
notes that this rule change is being proposed as a competitive offering 
at a time when other options exchanges are offering similar processes 
for opening their respective markets or managed interest processes. As 
a result of the competitive environment, Members will have various 
pricing and execution models to choose from in making determinations on 
where to enter orders prior to the opening of trading or which may 
potentially uncross the ABBO. The Exchange notes that it operates in a 
highly competitive market in which Members can readily direct order 
flow to competing venues if they deem fee levels to be excessive.

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

    Written comments were neither solicited nor received.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act,\12\ and Rule 19b-4(f)(2)\13\ thereunder. At 
any time within 60 days of the filing of the proposed rule change, the 
Commission summarily may temporarily suspend such rule change if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors, or otherwise 
in furtherance of the purposes of the Act. If the Commission takes such 
action, the Commission shall institute proceedings to determine whether 
the proposed rule should be approved or disapproved.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \13\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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-PEARL-2017-17 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-PEARL-2017-17. 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

[[Page 17929]]

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-PEARL-2017-17, and should be submitted on or before May 
4, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-07458 Filed 4-12-17; 8:45 am]
 BILLING CODE 8011-01-P



                                                                                  Federal Register / Vol. 82, No. 70 / Thursday, April 13, 2017 / Notices                                                     17927

                                                      The proposal shall not take effect                      By the Commission.                                   proposed rule change. The text of these
                                                    until all regulatory actions required                   Eduardo A. Aleman,                                     statements may be examined at the
                                                    with respect to the proposal are                        Assistant Secretary.                                   places specified in Item IV below. The
                                                    completed.                                              [FR Doc. 2017–07453 Filed 4–12–17; 8:45 am]            Exchange has prepared summaries, set
                                                                                                                                                                   forth in sections A, B, and C below, of
                                                    IV. Solicitation of Comments                            BILLING CODE 8011–01–P
                                                                                                                                                                   the most significant aspects of such
                                                       Interested persons are invited to                                                                           statements.
                                                    submit written data, views and                          SECURITIES AND EXCHANGE                                A. Self-Regulatory Organization’s
                                                    arguments concerning the foregoing,                     COMMISSION                                             Statement of the Purpose of, and
                                                    including whether the Advance Notice
                                                                                                            [Release No. 34–80401; File No. SR–                    Statutory Basis for, the Proposed Rule
                                                    is consistent with the Clearing
                                                                                                            PEARL–2017–17]                                         Change
                                                    Supervision Act. Comments may be
                                                    submitted by any of the following                       Self-Regulatory Organizations; MIAX                    1. Purpose
                                                    methods:                                                PEARL, LLC; Notice of Filing and                          The purpose of this proposed rule
                                                    Electronic Comments                                     Immediate Effectiveness of a Proposed                  change is to waive transaction rebates/
                                                                                                            Rule Change To Amend the MIAX                          fees applicable to executions that occur
                                                      • Use the Commission’s Internet                       PEARL Fee Schedule                                     as part of the Exchange’s opening
                                                    comment form (http://www.sec.gov/                                                                              procedures as described in Rule 503
                                                    rules/sro.shtml); or                                    April 7, 2017.
                                                                                                                                                                   (‘‘Openings on the Exchange’’) or that
                                                      • Send an email to rule-comments@                        Pursuant to the provisions of Section               uncross the ABBO,3 as described in
                                                    sec.gov. Please include File Number SR–                 19(b)(1) of the Securities Exchange Act                Rule 515 (‘‘Execution of Orders’’).
                                                    NSCC–2017–801 on the subject line.                      of 1934 (‘‘Act’’),1 and Rule 19b–4                        Under the Openings on the Exchange
                                                                                                            thereunder,2 notice is hereby given that               Rule, the Exchange will accept orders
                                                    Paper Comments                                          on April 6, 2017, MIAX PEARL, LLC                      for queuing in a series of options prior
                                                       • Send paper comments in triplicate                  (‘‘MIAX PEARL’’ or ‘‘Exchange’’) filed                 to the opening of trading in that series
                                                    to Secretary, Securities and Exchange                   with the Securities and Exchange                       of options. As such and as further
                                                    Commission, 100 F Street NE.,                           Commission (‘‘Commission’’) a                          described in Rule 503, executions might
                                                    Washington, DC 20549.                                   proposed rule change as described in                   occur in a series as part of the Exchange
                                                    All submissions should refer to File                    Items I, II, and III below, which Items                Opening as the series is being opened
                                                    Number SR–NSCC–2017–801. This file                      have been prepared by the Exchange.                    for trading. Pursuant to Section 1)a) of
                                                    number should be included on the                        The Commission is publishing this                      the Exchange’s Fee Schedule, the
                                                    subject line if email is used. To help the              notice to solicit comments on the                      Exchange currently assesses transaction
                                                    Commission process and review your                      proposed rule change from interested                   rebates and fees for transactions that
                                                    comments more efficiently, please use                   persons.                                               occur as part of the Exchange Opening.
                                                    only one method. The Commission will                    I. Self-Regulatory Organization’s                      In order to determine the applicable
                                                    post all comments on the Commission’s                   Statement of the Terms of Substance of                 transaction rebate and fee, the Exchange
                                                    Internet Web site (http://www.sec.gov/                  the Proposed Rule Change                               treats orders from Priority Customer 4
                                                    rules/sro.shtml). Copies of the                                                                                origin type as a ‘‘Maker,’’ and treats
                                                                                                               The Exchange is filing a proposal to
                                                    submission, all subsequent                                                                                     orders from all origin types other than
                                                                                                            amend the MIAX PEARL Fee Schedule
                                                    amendments, all written statements                                                                             Priority Customer (i.e., MIAX PEARL
                                                                                                            (the ‘‘Fee Schedule’’) to waive
                                                    with respect to the Advance Notice that                                                                        Market Maker 5 and Non-Priority
                                                                                                            transaction rebates/fees applicable to
                                                    are filed with the Commission, and all                                                                         Customer, Firm, BD and Non-MIAX
                                                                                                            transactions executed during the
                                                    written communications relating to the                                                                         PEARL Market Maker) 6 as a ‘‘Taker.’’
                                                                                                            opening and transactions that uncross
                                                    Advance Notice between the                                                                                     The Exchange now proposes that, for
                                                                                                            the Away Best Bid or Offer (‘‘ABBO’’).
                                                    Commission and any person, other than                      The Exchange initially filed the                    executions occurring as part of the
                                                    those that may be withheld from the                     proposal on March 29, 2017 (SR–                        Exchange Opening, the Exchange will
                                                    public in accordance with the                           PEARL–2017–13). That filing has been                   neither charge a fee nor provide a
                                                    provisions of 5 U.S.C. 552, will be                     withdrawn and replaced with the                        rebate, regardless of origin type.
                                                    available for Web site viewing and                                                                                Further, pursuant to Section 1)a) of
                                                                                                            current filing (SR–PEARL–2017–17).
                                                    printing in the Commission’s Public                        The text of the proposed rule change                the Exchange’s Fee Schedule, the
                                                    Reference Room, 100 F Street NE.,                       is available on the Exchange’s Web site                Exchange currently assesses transaction
                                                    Washington, DC 20549 on official                        at http://www.miaxoptions.com/rule-                    rebates and fees for transactions that
                                                    business days between the hours of                      filings/pearl, at MIAX PEARL’s                         uncross the ABBO. In order to
                                                    10:00 a.m. and 3:00 p.m. Copies of the                  principal office, and at the
                                                    filing also will be available for                       Commission’s Public Reference Room.
                                                                                                                                                                     3 See  MIAX PEARL Rule 100.
                                                                                                                                                                     4 The  term ‘‘Priority Customer’’ is defined in
                                                    inspection and copying at the principal
                                                                                                            II. Self-Regulatory Organization’s                     Exchange Rule 100 to mean a person or entity that
                                                    office of NSCC and on DTCC’s Web site                                                                          (i) is not a broker or dealer in securities, and (ii)
                                                    (http://dtcc.com/legal/sec-rule-                        Statement of the Purpose of, and                       does not place more than 390 orders in listed
                                                    filings.aspx). All comments received                    Statutory Basis for, the Proposed Rule                 options per day on average during a calendar month
                                                    will be posted without change; the                      Change                                                 for its own beneficial accounts(s). The number of
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                                                                                                                                   orders is counted in accordance with Rule 100
                                                    Commission does not edit personal                          In its filing with the Commission, the              Interpretation and Policy .01.
                                                    identifying information from                            Exchange included statements                              5 The term ‘‘Market Maker’’ is defined in
                                                    submissions. You should submit only                     concerning the purpose of and basis for                Exchange Rule 100 to mean a Member registered
                                                    information that you wish to make                       the proposed rule change and discussed                 with the Exchange for the purpose of making
                                                    available publicly. All submissions                                                                            markets in options contracts traded on the
                                                                                                            any comments it received on the                        Exchange and that is vested with the rights and
                                                    should refer to File Number SR–NSCC–                                                                           responsibilities specified in Chapter VI of the
                                                    2017–801 and should be submitted on                       1 15   U.S.C. 78s(b)(1).                             Exchange’s Rules.
                                                    or before April 28, 2017.                                 2 17   CFR 240.19b–4.                                   6 See MIAX PEARL Fee Schedule, Section 1(a).




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                                                    17928                         Federal Register / Vol. 82, No. 70 / Thursday, April 13, 2017 / Notices

                                                    determine the applicable transaction                    Opening is reasonable, fair and                        highly competitive market in which
                                                    rebate and fee, the Exchange treats                     equitable because it will incentivize                  Members can readily direct order flow
                                                    orders from Priority Customer origin                    Members 11 to send greater order flow to               to competing venues if they deem fee
                                                    type as a ‘‘Maker,’’ and treats orders                  the Exchange in this scenario,                         levels to be excessive.
                                                    from all origin types other than Priority               potentially providing greater liquidity
                                                                                                                                                                   C. Self-Regulatory Organization’s
                                                    Customer as a ‘‘Taker.’’ The Exchange                   on the Exchange. In addition, the
                                                                                                            Exchange believes that the foregoing is                Statement on Comments on the
                                                    now proposes that, for executions
                                                                                                            fair and equitable because it provides                 Proposed Rule Change Received From
                                                    occurring in such scenario, the
                                                                                                            certainty for Members with respect to                  Members, Participants, or Others
                                                    Exchange will neither charge a fee nor
                                                    provide a rebate, regardless of origin                  execution costs across all trades                        Written comments were neither
                                                    type.                                                   occurring as part of the Exchange                      solicited nor received.
                                                       The Exchange has determined to                       Opening. Lastly, the Exchange also
                                                                                                                                                                   III. Date of Effectiveness of the
                                                    make these changes for competitive                      believes that the proposed pricing for
                                                                                                                                                                   Proposed Rule Change and Timing for
                                                    reasons in order to attract more order                  executions occurring as part of the
                                                                                                                                                                   Commission Action
                                                    flow to the Exchange in these scenarios.                Opening on the Exchange is
                                                    The Exchange notes that other                           nondiscriminatory because it will apply                   The foregoing rule change has become
                                                    exchanges do not assess transaction                     equally to all Members, regardless of                  effective pursuant to Section
                                                    rebates/fees in these scenarios,                        origin type.                                           19(b)(3)(A)(ii) of the Act,12 and Rule
                                                    including Bats BZX Exchange.7 The                          The proposal further provides that                  19b–4(f)(2)13 thereunder. At any time
                                                    Exchange notes that any contracts                       executions that uncross the ABBO will                  within 60 days of the filing of the
                                                    executed as a result of such transactions               not be assessed any fees or receive any                proposed rule change, the Commission
                                                    will continue to be counted for purposes                rebates, regardless of origin type. The                summarily may temporarily suspend
                                                    of determining the volume criteria and                  Exchange believes that its proposal to                 such rule change if it appears to the
                                                    TCV 8 for purposes of calculating tiered                waive transaction rebates/fees that                    Commission that such action is
                                                    rebates and fees.                                       uncross the ABBO is reasonable, fair                   necessary or appropriate in the public
                                                                                                            and equitable because it will incentivize              interest, for the protection of investors,
                                                    2. Statutory Basis                                      Members to send greater order flow to                  or otherwise in furtherance of the
                                                       The Exchange believes that its                       the Exchange in this scenario,                         purposes of the Act. If the Commission
                                                    proposal to amend its fee schedule is                   potentially providing greater liquidity                takes such action, the Commission shall
                                                    consistent with Section 6(b) of the Act 9               on the Exchange. In addition, the                      institute proceedings to determine
                                                    in general, and furthers the objectives of              Exchange believes that the foregoing is                whether the proposed rule should be
                                                    Section 6(b)(4) of the Act 10 in                        fair and equitable because it provides                 approved or disapproved.
                                                    particular, in that it is an equitable                  certainty for Members with respect to
                                                                                                                                                                   IV. Solicitation of Comments
                                                    allocation of reasonable dues, fees and                 execution costs across all trades which
                                                    other charges among its members and                     uncross the ABBO. Lastly, the Exchange                   Interested persons are invited to
                                                    issuers and other persons using its                     also believes that the proposed pricing                submit written data, views, and
                                                    facilities. The Exchange also believes                  for executions occurring in this scenario              arguments concerning the foregoing,
                                                    the proposal furthers the objectives of                 is nondiscriminatory because it will                   including whether the proposed rule
                                                    Section 6(b)(5) of the Act in that it is                apply equally to all Members, regardless               change is consistent with the Act.
                                                    designed to promote just and equitable                  of origin type.                                        Comments may be submitted by any of
                                                    principles of trade, to remove                                                                                 the following methods:
                                                                                                            B. Self-Regulatory Organization’s
                                                    impediments to and perfect the                          Statement on Burden on Competition                     Electronic Comments
                                                    mechanism of a free and open market
                                                    and a national market system, and, in                     MIAX PEARL does not believe that                       • Use the Commission’s Internet
                                                    general to protect investors and the                    the proposed rule change will impose                   comment form (http://www.sec.gov/
                                                    public interest and is not designed to                  any burden on competition not                          rules/sro.shtml); or
                                                    permit unfair discrimination between                    necessary or appropriate in furtherance                  • Send an email to rule-comments@
                                                    customers, issuers, brokers and dealers.                of the purposes of the Act. To the                     sec.gov. Please include File Number SR–
                                                       The proposal provides that executions                contrary, the Exchange notes that this                 PEARL–2017–17 on the subject line.
                                                    that occur as part of the Exchange                      rule change is being proposed as a                     Paper Comments
                                                    Opening will not incur any fees or                      competitive offering at a time when
                                                                                                            other options exchanges are offering                     • Send paper comments in triplicate
                                                    receive any rebates, regardless of origin
                                                                                                            similar processes for opening their                    to Brent J. Fields, Secretary, Securities
                                                    type. The Exchange believes that its
                                                                                                            respective markets or managed interest                 and Exchange Commission, 100 F Street
                                                    proposal to waive transaction rebates/
                                                                                                            processes. As a result of the competitive              NE., Washington, DC 20549–1090.
                                                    fees that occur as part of the Exchange
                                                                                                            environment, Members will have                         All submissions should refer to File
                                                      7 See Securities Exchange Act Release No. 71746       various pricing and execution models to                Number SR–PEARL–2017–17. This file
                                                    (March 19, 2014), 79 FR 16412 (March 25, 2014)          choose from in making determinations                   number should be included on the
                                                    (SR–BATS–2014–006).                                     on where to enter orders prior to the                  subject line if email is used. To help the
                                                      8 TCV means total consolidated volume
                                                                                                            opening of trading or which may                        Commission process and review your
                                                    calculated as the total national volume in those
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    classes listed on MIAX PEARL for the month for          potentially uncross the ABBO. The                      comments more efficiently, please use
                                                    which the fees apply, excluding consolidated            Exchange notes that it operates in a                   only one method. The Commission will
                                                    volume executed during the period time in which                                                                post all comments on the Commission’s
                                                    the Exchange experiences an outage of a Matching           11 ‘‘Member’’ means an individual or organization   Internet Web site (http://www.sec.gov/
                                                    Engine or collective Matching Engines for a period      that is registered with the Exchange pursuant to
                                                    of two consecutive hours or more, during trading
                                                                                                                                                                   rules/sro.shtml). Copies of the
                                                                                                            Chapter II of the Exchange Rules for purposes of
                                                    hours (solely in the option classes of the affected     trading on the Exchange as an ‘‘Electronic Exchange
                                                                                                                                                                   submission, all subsequent
                                                    Matching Engine). See Fee Schedule Definitions.         Member’’ or ‘‘Market Maker.’’ Members are deemed
                                                      9 15 U.S.C. 78f(b).                                                                                           12 15   U.S.C. 78s(b)(3)(A)(ii).
                                                                                                            ‘‘members’’ under the Exchange Act. See MIAX
                                                      10 15 U.S.C. 78f(b)(4) and (5).                       PEARL Rule 100.                                         13 17   CFR 240.19b–4(f)(2).



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                                                                                   Federal Register / Vol. 82, No. 70 / Thursday, April 13, 2017 / Notices                                                  17929

                                                    amendments, all written statements                      solicit comments on the proposed rule                 Exchange has not yet begun to list or
                                                    with respect to the proposed rule                       from interested persons.                              trade options settling to the RealVolTM
                                                    change that are filed with the                                                                                SPY Index, but plans to do so in the
                                                                                                            I. Self-Regulatory Organization’s
                                                    Commission, and all written                                                                                   future.
                                                                                                            Statement of the Terms of the Substance
                                                    communications relating to the                                                                                   As proposed in the initial filing, the
                                                                                                            of the Proposed Rule Change
                                                    proposed rule change between the                                                                              Exchange proposes to submit a Pilot
                                                    Commission and any person, other than                      The Exchange proposes to extend the                Program Report to the Securities and
                                                    those that may be withheld from the                     pilot program for the listing and trading             Exchange Commission (the
                                                    public in accordance with the                           of options settling to the RealVolTM SPY              ‘‘Commission’’) two months prior to the
                                                    provisions of 5 U.S.C. 552, will be                     Index (‘‘Index’’). The text of the                    expiration date of the Pilot Program (the
                                                    available for Web site viewing and                      proposed rule change is available from                ‘‘annual report’’).5 The annual report
                                                    printing in the Commission’s Public                     the principal office of the Exchange, at              would contain an analysis of volume,
                                                    Reference Room, 100 F Street NE.,                       the Commission’s Public Reference                     open interest, and trading patterns. The
                                                    Washington, DC 20549 on official                        Room and also on the Exchange’s                       analysis would examine trading in the
                                                    business days between the hours of                      Internet Web site at http://                          proposed option product as well as
                                                    10:00 a.m. and 3:00 p.m. Copies of such                 boxexchange.com.                                      trading in SPY. In addition, for series
                                                    filing also will be available for                       II. Self-Regulatory Organization’s                    that exceed certain minimum open
                                                    inspection and copying at the principal                 Statement of the Purpose of, and                      interest parameters, the annual report
                                                    office of the Exchange. All comments                    Statutory Basis for, the Proposed Rule                would provide analysis of index price
                                                    received will be posted without change;                 Change                                                volatility and SPY trading activity. In
                                                    the Commission does not edit personal                                                                         addition to the annual report, the
                                                                                                               In its filing with the Commission, the
                                                    identifying information from                                                                                  Exchange would provide the
                                                                                                            self-regulatory organization included
                                                    submissions. You should submit only                                                                           Commission with periodic interim
                                                                                                            statements concerning the purpose of,
                                                    information that you wish to make                                                                             reports while the pilot is in effect that
                                                                                                            and basis for, the proposed rule change
                                                    available publicly. All submissions                     and discussed any comments it received                would contain some, but not all, of the
                                                    should refer to File Number SR–                         on the proposed rule change. The text                 information contained in the annual
                                                    PEARL–2017–17, and should be                            of these statements may be examined at                report. The annual report would be
                                                    submitted on or before May 4, 2017.                     the places specified in Item IV below.                provided to the Commission on a
                                                      For the Commission, by the Division of                The self-regulatory organization has                  confidential basis.
                                                    Trading and Markets, pursuant to delegated              prepared summaries, set forth in                         The annual report would contain the
                                                    authority.14                                            Sections A, B, and C below, of the most               following volume and open interest
                                                    Eduardo A. Aleman,                                      significant aspects of such statements.               data:
                                                    Assistant Secretary.
                                                                                                                                                                     (1) Monthly volume aggregated for all
                                                                                                            A. Self-Regulatory Organization’s                     trades;
                                                    [FR Doc. 2017–07458 Filed 4–12–17; 8:45 am]
                                                                                                            Statement of the Purpose of, and                         (2) monthly volume aggregated by
                                                    BILLING CODE 8011–01–P                                  Statutory Basis for, the Proposed Rule                expiration date;
                                                                                                            Change                                                   (3) monthly volume for each
                                                                                                            1. Purpose                                            individual series;
                                                    SECURITIES AND EXCHANGE
                                                                                                                                                                     (4) month-end open interest
                                                    COMMISSION                                                 The purpose of the proposed rule                   aggregated for all series;
                                                                                                            change is to extend the pilot period for                 (5) month-end open interest for all
                                                    [Release No. 34–80400; File No. SR– BOX–                the listing and trading of options                    series aggregated by expiration date; and
                                                    2017–11]                                                settling to the RealVolTM SPY Index                      (6) month-end open interest for each
                                                                                                            (‘‘Index’’), which is currently scheduled             individual series.
                                                    Self-Regulatory Organizations; BOX                      to expire on May 6, 2017.3 The                           In addition to the annual report, the
                                                    Options Exchange LLC; Notice of                         Exchange is proposing to extend the                   Exchange would provide the
                                                    Filing and Immediate Effectiveness of                   pilot period for an additional twelve                 Commission with interim reports of the
                                                    a Proposed Rule Change To Extend                        (12) month period, until May 6, 2018.                 information listed in Items (1) through
                                                    the Pilot Program for the Listing and                   This filing does not propose any                      (6) above periodically as required by the
                                                    Trading of Options Settling to the                      substantive changes to the listing and                Commission while the pilot is in effect.
                                                    RealVolTM SPY Index (‘‘Index’’)                         trading of options settling to the                    These interim reports would also be
                                                    April 7, 2017.
                                                                                                            RealVolTM SPY (‘‘the RealVolTM SPY                    provided on a confidential basis.
                                                                                                            Pilot Program’’ or ‘‘Pilot Program’’).                   In addition, the annual report would
                                                       Pursuant to Section 19(b)(1) of the                     In the initial proposal to list and trade          contain the following analysis of trading
                                                    Securities Exchange Act of 1934                         this product, the Exchange stated that if             patterns in VOLS series in the pilot:
                                                    (‘‘Act’’),1 and Rule 19b–4 thereunder,2                 it were to propose an extension,                         (1) A time series analysis of open
                                                    notice is hereby given that on April 4,                 permanent approval or termination of                  interest; and
                                                    2017, BOX Options Exchange LLC (the                     the Pilot Program, the Exchange would                    (2) an analysis of the distribution of
                                                    ‘‘Exchange’’) filed with the Securities                 submit a filing proposing such                        trade sizes.
                                                    and Exchange Commission                                 amendments to the program.4                              Also, for series that exceed certain
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    (‘‘Commission’’) the proposed rule                      Accordingly, the Exchange is submitting               minimum parameters, the annual report
                                                    change as described in Items I and II                   this filing to extend the program, as the             would contain the following analysis
                                                    below, which Items have been prepared                                                                         related to index price changes and SPY
                                                    by the self-regulatory organization. The                  3 See Securities Exchange Act Release No. 77660
                                                                                                                                                                  trading volume at the close on
                                                    Commission is publishing this notice to                 (April 20, 2016), 81 FR 24676 (April 26, 2016)
                                                                                                            (Notice of Filing and Immediate Effectiveness SR–     expiration Fridays:
                                                                                                            BOX–2016–19).
                                                      14 17 CFR 200.30–3(a)(12).                              4 See Securities Exchange Act Release No. 74876        5 Id. The Exchange did not submit an annual
                                                      1 15 U.S.C. 78s(b)(1).                                (May 5, 2015), 80 FR 26966 (May 11, 2015) (Order      report because the Index was never listed for
                                                      2 17 CFR 240.19b–4.                                   Approving SR–BOX–2015–06).                            trading.



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Document Created: 2017-04-13 01:09:00
Document Modified: 2017-04-13 01:09:00
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation82 FR 17927 

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