82 FR 22706 - Self-Regulatory Organizations; NASDAQ BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 4770 To Modify the Date of Appendix B Web Site Data Publication
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 94 (May 17, 2017)
Federal Register Volume 82, Issue 94 (May 17, 2017)
| Page Range | 22706-22708 | |
| FR Document | 2017-09926 |
[Federal Register Volume 82, Number 94 (Wednesday, May 17, 2017)] [Notices] [Pages 22706-22708] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-09926] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-80656; File No. SR-BX-2017-022] Self-Regulatory Organizations; NASDAQ BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 4770 To Modify the Date of Appendix B Web Site Data Publication May 11, 2017. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on April 28, 2017, NASDAQ BX, Inc. (``BX'' or ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``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\ 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 Rule 4770 to modify the date of Appendix B Web site data publication pursuant to the Regulation NMS Plan to Implement a Tick Size Pilot Program (``Plan''). The text of the proposed rule change is available on the Exchange's Web site at http://nasdaqbx.cchwallstreet.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 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 Rule 4770(b) (Compliance with Data Collection Requirements) \3\ implements the data collection and Web site publication requirements of the Plan.\4\ Commentary .08 to Rule 4770 provides, among other things, that the requirement that the Exchange provide information to the SEC within 30 days following month end pursuant to Appendix B and C of the Plan shall commence at the beginning of the Pilot Period.\5\ Commentary .08 to Rule 4770 also provides that, with respect to data for the Pre- Pilot and Pilot Period, the requirement that the Exchange or DEA make Appendix B data publicly available on the Exchange's or DEA's Web site shall commence on April 28, 2017.\6\ --------------------------------------------------------------------------- \3\ See Rule 4770(b). See also Securities Exchange Act Release No. 77457 (March 28, 2016), 81 FR 18913 (April 1, 2016) (SR-BX-2016- 019). \4\ The Participants filed the Plan to comply with an order issued by the Commission on June 24, 2014. See Letter from Brendon J. Weiss, Vice President, Intercontinental Exchange, Inc., to Secretary, Commission, dated August 25, 2014 (``SRO Tick Size Plan Proposal''). See Securities Exchange Act Release No 72460 (June 24, 2014), 79 FR 36840 (June 30, 2014); see also Securities Exchange Act Release No. 74892 (May 6, 2015), 80 FR 27513 (May 13, 2015). \5\ Unless otherwise defined herein, capitalized terms have the meaning ascribed to them in Rule 4770. \6\ On November 30, 2016, the SEC granted exemptive relief to the Participants to, among other things, delay the publication of Web site data pursuant to Appendices B and C to the Plan until February 28, 2017, and to delay the ongoing Web site publication by ninety days such that data would be published within 120 calendar days following the end of the month. See Letter from David S. Shillman, Associate Director, Division of Trading and Markets, Commission, to Marcia E. Asquith, Senior Vice President and Corporate Secretary, FINRA, dated November 30, 2016; see also Securities Exchange Act Release No. 79549 (December 14, 2016), 81 FR 92886 (December 20, 2016) (SR-BX-2017-067). The SEC subsequently extended this exemptive relief to April 28, 2017. See Letter from David S. Shillman, Associate Director, Division of Trading and Markets, Commission, to Robert L.D. Colby, Executive Vice President and Chief Legal Officer, FINRA, dated February 28, 2017. --------------------------------------------------------------------------- BX is now proposing to amend Commentary .08 to Rule 4770 to delay the date by which Pre-Pilot and Pilot Appendix B data is to be made publicly available on the Exchange's Web site from April 28, 2017 to August 31, 2017.\7\ --------------------------------------------------------------------------- \7\ Commentary .08 to Rule 4770 initially required that the Exchange make Pre-Pilot and Pilot Appendix B data publicly available by February 28, 2017. BX filed a proposed rule change to extend this date to April 28, 2017. See Securities Exchange Act Release No. 80228 (March 13, 2017), 82 FR 14256 (March 17, 2017) (SR-BX-2017- 016). --------------------------------------------------------------------------- In the SRO Tick Size Plan Proposal, the Participants stated that the public data will be made available for free ``on a disaggregated basis by trading center'' on the Web sites of the Participants and the Designated Examining Authorities.\8\ However, market participants have expressed confidentiality concerns regarding this approach for over- the-counter (``OTC'') data.\9\ Thus, BX is filing the instant proposed rule change to provide additional time to assess a means of addressing the confidentiality concerns raised in connection with the publication of Appendix B data related to OTC activity in furtherance of the objectives of the Plan.\10\ Pursuant to this amendment, Appendix B data publication will be delayed until August 31, 2017. The Participants anticipate filing additional proposed rule changes to address Appendix B data publication. --------------------------------------------------------------------------- \8\ See Securities Exchange Act Release No. 73511 (November 3, 2014), 79 FR 66423 (November 7, 2014) (Notice of Filing of Proposed National Market System Plan to Implement a Tick Size Pilot Program on a One-Year Pilot Basis, File No. 4-657) (``Tick Size Plan Proposal''). \9\ See letters from Adam C. Cooper, Senior Managing Director and Chief Legal Officer, Citadel Securities, to Brent J. Fields, Secretary, Commission, dated December 21, 2016 (``Citadel letter''); and William Hebert, Managing Director, Financial Information Forum, to Robert W. Errett, Deputy Secretary, Commission, dated December 21, 2016 (``FIF letter''). \10\ In connection with its filing to implement a similar change in its rules, the Financial Industry Regulatory Authority, Inc. is also is submitting an exemptive request to the SEC on behalf of all Plan Participants requesting relief from the relevant requirements of the Plan. --------------------------------------------------------------------------- BX has filed the proposed rule change for immediate effectiveness. The operative date of the proposed rule change will be the date of filing. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\11\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\12\ in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, 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. BX also believes that the proposal is consistent with Section [[Page 22707]] 6(b)(8) of the Act,\13\ which requires that Exchange rules not impose any burden on competition that is not necessary or appropriate. --------------------------------------------------------------------------- \11\ 15 U.S.C. 78f(b). \12\ 15 U.S.C. 78f(b)(5). \13\ 15 U.S.C. 78f(b)(8). --------------------------------------------------------------------------- The Plan is designed to allow the Commission, market participants, and the public to study and assess the impact of increment conventions on the liquidity and trading of the common stock of small- capitalization companies. BX believes that this proposal is consistent with the Act because it is in furtherance of the objectives of Section VII(A) of the Plan in that it is designed to provide BX with additional time to assess a means of addressing the confidentiality concerns raised in connection with the publication of Appendix B data, to comply with the Plan's requirements that the data made publicly available will not identify the trading center that generated the data. 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 not necessary or appropriate in furtherance of the purposes of the Act. The proposed rule change implements the provisions of the Plan, and all Participants are filing similar proposals to extend the publication date of Appendix B data. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing 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 for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act \14\ and Rule 19b- 4(f)(6) thereunder.\15\ --------------------------------------------------------------------------- \14\ 15 U.S.C. 78s(b)(3)(A). \15\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- A proposed rule change filed under Rule 19(b)-4(f)(6) normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b-4(f)(6)(iii), the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has filed the proposed rule change for immediate effectiveness and has requested that the Commission waive the requirement that the proposed rule change not become operative for 30 days after the date of the filing so that it may become operative on the date of filing. The Exchange notes that the proposed rule change is intended to mitigate confidentiality concerns raised in connection with Section VII(A) of the Plan, which provides that the data made publicly available will not identify the Trading Center that generated the data. The Exchange states that the additional time would allow consideration of a methodology to mitigate concerns related to the publication of Appendix B data.\16\ --------------------------------------------------------------------------- \16\ The Commission recently approved a FINRA proposal to implement an aggregated, anonymous grouped masking methodology for the publication of Appendix B data related to OTC trading activity. See Securities Exchange Release No. 80551, (April 28, 2017), 82 FR 20948 (May 4, 2017). See also Letter from David S. Shillman, Associate Director, Division of Trading and Markets, Commission, to Marcia E. Asquith, Executive Vice President FINRA, dated April 28, 2017. --------------------------------------------------------------------------- The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because it will synchronize the timing for publication of Appendix B data for all Participants, which should enhance the consistency and usefulness of the data.\17\ Therefore, the Commission hereby waives the 30-day operative delay and designates the proposed rule change to be operative on the date of filing.\18\ --------------------------------------------------------------------------- \17\ The Commission recently granted exemptive relief to the Participants to delay the publication of their Appendix B data until August 31, 2017. See Letter from David S. Shillman, Associate Director, Division of Trading and Markets, Commission, to Jennifer Piorko Mitchell, Vice President and Deputy Corporate Secretary, FINRA, dated April 28, 2017. The Commission notes that other Participants have submitted proposed rule changes to delay the publication of Appendix B data until August 31, 2017. See e.g., SR- BatsBYX-2017-10; SR-BatsBZX-2017-31; SR-BatsEDGA-2017-10; SR- BatsEDGX-2017-19; SR-CHX-2017-07; SR-FINRA-2017-010; SR-IEX-2017-12; SR-NASDAQ-2017-044; SR-Phlx-2017-33; SR-NYSE-2017-19; SR-NYSEArca- 2017-49; SR-NYSEMKT-2017-24. \18\ For purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). --------------------------------------------------------------------------- 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. 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 CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to rule-comments@sec.gov. Please include File Number SR-BX-2017-022 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-BX-2017-022. 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 the 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-BX-2017-022 and should be submitted on or before June 7, 2017. [[Page 22708]] For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\19\ --------------------------------------------------------------------------- \19\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-09926 Filed 5-16-17; 8:45 am] BILLING CODE 8011-01-P
![22706 Federal Register / Vol. 82, No. 94 / Wednesday, May 17, 2017 / Notices
proposed rule change (SR–NYSEArca– any comments it received on the available on the Exchange’s Web site
2017–09), as modified by Amendment proposed rule change. The text of these from April 28, 2017 to August 31, 2017.7
No. 2, be, and it hereby is, approved on statements may be examined at the In the SRO Tick Size Plan Proposal,
an accelerated basis. places specified in Item IV below. The the Participants stated that the public
For the Commission, by the Division of Exchange has prepared summaries, set data will be made available for free ‘‘on
Trading and Markets, pursuant to delegated forth in sections A, B, and C below, of a disaggregated basis by trading center’’
authority.27 the most significant aspects of such on the Web sites of the Participants and
Eduardo A. Aleman, statements. the Designated Examining Authorities.8
Assistant Secretary. However, market participants have
A. Self-Regulatory Organization’s expressed confidentiality concerns
[FR Doc. 2017–09927 Filed 5–16–17; 8:45 am] Statement of the Purpose of, and regarding this approach for over-the-
BILLING CODE 8011–01–P Statutory Basis for, the Proposed Rule counter (‘‘OTC’’) data.9 Thus, BX is
Change filing the instant proposed rule change
SECURITIES AND EXCHANGE 1. Purpose to provide additional time to assess a
COMMISSION Rule 4770(b) (Compliance with Data means of addressing the confidentiality
Collection Requirements) 3 implements concerns raised in connection with the
[Release No. 34–80656; File No. SR–BX– publication of Appendix B data related
2017–022] the data collection and Web site
to OTC activity in furtherance of the
publication requirements of the Plan.4
objectives of the Plan.10 Pursuant to this
Self-Regulatory Organizations; Commentary .08 to Rule 4770 provides,
amendment, Appendix B data
NASDAQ BX, Inc.; Notice of Filing and among other things, that the
publication will be delayed until August
Immediate Effectiveness of Proposed requirement that the Exchange provide
31, 2017. The Participants anticipate
Rule Change To Amend Rule 4770 To information to the SEC within 30 days
filing additional proposed rule changes
Modify the Date of Appendix B Web following month end pursuant to
to address Appendix B data publication.
Site Data Publication Appendix B and C of the Plan shall BX has filed the proposed rule change
commence at the beginning of the Pilot for immediate effectiveness. The
May 11, 2017. Period.5 Commentary .08 to Rule 4770
Pursuant to Section 19(b)(1) of the operative date of the proposed rule
also provides that, with respect to data change will be the date of filing.
Securities Exchange Act of 1934 for the Pre-Pilot and Pilot Period, the
(‘‘Act’’),1 and Rule 19b–4 thereunder,2 requirement that the Exchange or DEA 2. Statutory Basis
notice is hereby given that on April 28, make Appendix B data publicly The Exchange believes that its
2017, NASDAQ BX, Inc. (‘‘BX’’ or available on the Exchange’s or DEA’s proposal is consistent with Section 6(b)
‘‘Exchange’’) filed with the Securities Web site shall commence on April 28, of the Act,11 in general, and furthers the
and Exchange Commission (‘‘SEC’’ or 2017.6 objectives of Section 6(b)(5) of the Act,12
‘‘Commission’’) the proposed rule BX is now proposing to amend in particular, in that it is designed to
change as described in Items I and II Commentary .08 to Rule 4770 to delay prevent fraudulent and manipulative
below, which Items have been prepared the date by which Pre-Pilot and Pilot acts and practices, promote just and
by the Exchange. The Commission is Appendix B data is to be made publicly equitable principles of trade, to remove
publishing this notice to solicit impediments to and perfect the
comments on the proposed rule change 3 See Rule 4770(b). See also Securities Exchange
mechanism of a free and open market
from interested persons. Act Release No. 77457 (March 28, 2016), 81 FR
and a national market system, and, in
18913 (April 1, 2016) (SR–BX–2016–019).
I. Self-Regulatory Organization’s 4 The Participants filed the Plan to comply with general to protect investors and the
Statement of the Terms of Substance of an order issued by the Commission on June 24, public interest. BX also believes that the
the Proposed Rule Change 2014. See Letter from Brendon J. Weiss, Vice proposal is consistent with Section
President, Intercontinental Exchange, Inc., to
The Exchange proposes to amend Secretary, Commission, dated August 25, 2014 7 Commentary .08 to Rule 4770 initially required
Rule 4770 to modify the date of (‘‘SRO Tick Size Plan Proposal’’). See Securities
that the Exchange make Pre-Pilot and Pilot
Appendix B Web site data publication Exchange Act Release No 72460 (June 24, 2014), 79
FR 36840 (June 30, 2014); see also Securities Appendix B data publicly available by February 28,
pursuant to the Regulation NMS Plan to Exchange Act Release No. 74892 (May 6, 2015), 80 2017. BX filed a proposed rule change to extend
Implement a Tick Size Pilot Program FR 27513 (May 13, 2015). this date to April 28, 2017. See Securities Exchange
Act Release No. 80228 (March 13, 2017), 82 FR
(‘‘Plan’’). 5 Unless otherwise defined herein, capitalized
14256 (March 17, 2017) (SR–BX–2017–016).
The text of the proposed rule change terms have the meaning ascribed to them in Rule 8 See Securities Exchange Act Release No. 73511
is available on the Exchange’s Web site 4770.
6 On November 30, 2016, the SEC granted (November 3, 2014), 79 FR 66423 (November 7,
at http://nasdaqbx.cchwallstreet.com/, exemptive relief to the Participants to, among other
2014) (Notice of Filing of Proposed National Market
at the principal office of the Exchange, System Plan to Implement a Tick Size Pilot Program
things, delay the publication of Web site data
on a One-Year Pilot Basis, File No. 4–657) (‘‘Tick
and at the Commission’s Public pursuant to Appendices B and C to the Plan until
Size Plan Proposal’’).
Reference Room. February 28, 2017, and to delay the ongoing Web 9 See letters from Adam C. Cooper, Senior
site publication by ninety days such that data
Managing Director and Chief Legal Officer, Citadel
II. Self-Regulatory Organization’s would be published within 120 calendar days
Securities, to Brent J. Fields, Secretary,
Statement of the Purpose of, and following the end of the month. See Letter from
David S. Shillman, Associate Director, Division of Commission, dated December 21, 2016 (‘‘Citadel
Statutory Basis for, the Proposed Rule Trading and Markets, Commission, to Marcia E. letter’’); and William Hebert, Managing Director,
Change Asquith, Senior Vice President and Corporate Financial Information Forum, to Robert W. Errett,
Secretary, FINRA, dated November 30, 2016; see Deputy Secretary, Commission, dated December 21,
In its filing with the Commission, the 2016 (‘‘FIF letter’’).
nlaroche on DSK30NT082PROD with NOTICES
also Securities Exchange Act Release No. 79549
Exchange included statements (December 14, 2016), 81 FR 92886 (December 20,
10 In connection with its filing to implement a
concerning the purpose of and basis for 2016) (SR–BX–2017–067). The SEC subsequently similar change in its rules, the Financial Industry
extended this exemptive relief to April 28, 2017. Regulatory Authority, Inc. is also is submitting an
the proposed rule change and discussed exemptive request to the SEC on behalf of all Plan
See Letter from David S. Shillman, Associate
Director, Division of Trading and Markets, Participants requesting relief from the relevant
26 15 U.S.C. 78s(b)(2). requirements of the Plan.
Commission, to Robert L.D. Colby, Executive Vice
27 17 CFR 200.30–3(a)(12). 11 15 U.S.C. 78f(b).
President and Chief Legal Officer, FINRA, dated
1 15 U.S.C. 78s(b)(1). February 28, 2017. 12 15 U.S.C. 78f(b)(5).
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![22708 Federal Register / Vol. 82, No. 94 / Wednesday, May 17, 2017 / Notices
For the Commission, by the Division of A. Self-Regulatory Organization’s Members (‘‘EEMs’’) 9 primarily use the
Trading and Markets, pursuant to delegated Statement of the Purpose of, and the FIX Interface for submitting orders.10
authority.19 Statutory Basis for, the Proposed Rule These Interface ports provide the
Eduardo A. Aleman, Change mechanism by which Members
Assistant Secretary. maintain a connection to the Exchange
1. Purpose and through which a Member
[FR Doc. 2017–09926 Filed 5–16–17; 8:45 am]
BILLING CODE 8011–01–P
The Exchange proposes to amend communicates its quotes and/or orders
Rule 519C, Mass Cancellation of to the System. Market Makers may
Trading Interest, to adopt new section submit quotes 11 to the Exchange from
SECURITIES AND EXCHANGE (c) entitled ‘‘Detection of Loss of one or more MEO ports. Similarly,
COMMISSION Communication,’’ to codify the use of Members may submit orders to the
current functionality in the Exchange’s Exchange from one or more FIX ports.
System 3 which is designed to assist When the System detects a loss of
[Release No. 34–80659; File No. SR–
PEARL–2017–21] Members 4 in the event of a loss of communication with a Member, the
communication with either their System has the capability to remove the
Self-Regulatory Organizations; MIAX assigned MIAX Express Orders Interface Member’s quotes and/or orders, if so
PEARL, LLC; Notice of Filing and (‘‘MEO Interface’’ or ‘‘MEO’’) 5 port or elected and configured by the Member.
Immediate Effectiveness of a Proposed Financial Information eXchange The Exchange notes that this
Rule Change To Amend Rule 519C Interface (‘‘FIX Interface’’ or ‘‘FIX’’) 6 functionality is mandatory for Members
port due to a loss of connectivity. This using MEO and optional for Members
May 11, 2017. functionality is designed to protect using FIX, as discussed in more detail
Pursuant to Section 19(b)(1) of the Members from inadvertent exposure to below.
Securities Exchange Act of 1934 excessive risk. The Exchange also
proposes to adopt new Interpretations MEO Connections
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2
notice is hereby given that, on May 5, and Policies .01 and .02 as discussed Members connect to their assigned
2017, MIAX PEARL, LLC (‘‘MIAX below. Additionally, the Exchange MEO port using the MIAX Session
PEARL’’ or ‘‘Exchange’’) filed with the proposes to make minor non substantive Management Protocol (‘‘SesM’’). The
Securities and Exchange Commission changes to Rule 100, Definitions, as SesM protocol uses Heartbeat 12 packets
(‘‘Commission’’) a proposed rule change described below. The Exchange notes to detect link failures between the
as described in Items I, II, and III below, that this filing is substantially similar in Member and the Exchange. The SesM
which Items have been prepared by the all material respects to a recent filing by protocol requires that the Exchange
Exchange. The Commission is the Exchange’s affiliate, Miami must send a Heartbeat packet anytime
publishing this notice to solicit International Securities Exchange, LLC more than one (1) second has passed
comments on the proposed rule change (‘‘MIAX Options’’).7 since the Exchange last sent any data.
from interested persons. MIAX PEARL Members may connect Further, the SesM protocol requires that
to the System using the MEO Interface the Member must send a Heartbeat
I. Self-Regulatory Organization’s and/or the FIX Interface. These two packet anytime more than one (1)
Statement of the Terms of Substance of connection protocols are not mutually second has passed since the Member
the Proposed Rule Change exclusive and Members, specifically last sent any data. If a certain number
Market Makers (‘‘MMs’’) 8 on the of consecutive Heartbeats are missed,13
The Exchange is filing a proposal to Exchange, primarily use the MEO or if the Member fails to send data or
amend Exchange Rule 519C. Interface for providing liquidity to the Heartbeats within ‘‘xx’’ period of time
The text of the proposed rule change Exchange via their Market Making (‘‘Heartbeat Interval’’), the System will
is available on the Exchange’s Web site activities, while Electronic Exchange automatically close the connection and
at http://www.miaxoptions.com/rule- listen for the Member to establish a new
filings/pearl at MIAX PEARL’s principal 3 The term ‘‘System’’ means the automated connection. The default Heartbeat
office, and at the Commission’s Public trading system used by the Exchange for the trading
Reference Room. of securities. See Exchange Rule 100. 9 The term ‘‘Electronic Exchange Member’’ or
4 The term ‘‘Member’’ means an individual or
‘‘EEM’’ means the holder of a Trading Permit who
II. Self-Regulatory Organization’s organization that is registered with the Exchange is a Member representing as agent Public Customer
Statement of the Purpose of, and pursuant to Chapter II of MIAX PEARL Rules for the Orders or Non-Customer Orders on the Exchange
purpose of trading on the Exchange as an and those non-Market Maker Members conducting
Statutory Basis for, the Proposed Rule ‘‘Electronic Exchange Member’’ or ‘‘Market Maker.’’ proprietary trading. Electronic Exchange Members
Change Members are deemed ‘‘members’’ under the are deemed ‘‘members’’ under the Exchange Act.
Exchange Act. See Exchange Rule 100. See Exchange Rule 100.
In its filing with the Commission, the 5 As proposed, the term ‘‘MEO Interface’’ means 10 The term ‘‘order’’ means a firm commitment to
Exchange included statements a binary order interface used for submitting certain buy or sell option contracts. See Exchange Rule 100.
concerning the purpose of and basis for order types (as set forth in MIAX PEARL Rule 516) 11 The term ‘‘quote’’ or ‘‘quotation’’ means a bid
to the MIAX PEARL System. See proposed or offer entered by a Market Maker as a firm order
the proposed rule change and discussed Exchange Rule 100. that updates the Market Maker’s previous bid or
any comments it received on the 6 As proposed, the term ‘‘FIX Interface’’ means
offer, if any. When the term order is used in these
proposed rule change. The text of these the Financial Information Exchange interface used Rules and a bid or offer is entered by the Market
statements may be examined at the for submitting certain order types (as set forth in Maker in the option series to which such Market
places specified in Item IV below. The MIAX PEARL Rule 516) to the MIAX PEARL Maker is registered, such order shall, as applicable,
System. See proposed Exchange Rule 100. constitute a quote or quotation for purposes of these
Exchange has prepared summaries, set
nlaroche on DSK30NT082PROD with NOTICES
7 See Securities Exchange Act Release No. 80151 Rules. See Exchange Rule 100.
forth in sections A, B, and C below, of (March 3, 2017), 82 FR 13146 (March 9, 2017) (SR– 12 A Heartbeat message is a communication which
the most significant aspects of such MIAX–2017–08). acts as a virtual pulse between the Exchange System
statements. 8 The term ‘‘Market Maker’’ or ‘‘MM’’ means a and the Member’s system. The Heartbeat message
Member registered with the Exchange for the sent by the Member and received by the Exchange
purpose of making markets in options contracts allows the Exchange to continually monitor its
19 17 CFR 200.30–3(a)(12). traded on the Exchange and that is vested with the connection with the Member.
1 15 U.S.C. 78s(b)(1). rights and responsibilities specified in Chapter VI 13 The Exchange notes that the current setting is
2 17 CFR 240.19b–4. of MIAX PEARL Rules. See Exchange Rule 100. three (3) Heartbeats.
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Document Created: 2017-05-17 01:42:02
Document Modified: 2017-05-17 01:42:02
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 82 FR 22706 |
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