82 FR 26168 - Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend a Pilot Program To Quote and To Trade Certain Options Classes in Penny Increments

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 107 (June 6, 2017)

Page Range		26168-26169
FR Document		2017-11611
Federal Register, Volume 82 Issue 107 (Tuesday, June 6, 2017)
[Federal Register Volume 82, Number 107 (Tuesday, June 6, 2017)]
[Notices]
[Pages 26168-26169]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-11611]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80827; File No. SR-ISE-2017-48]


Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Extend a Pilot 
Program To Quote and To Trade Certain Options Classes in Penny 
Increments

May 31, 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 May 25, 2017, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``SEC'' or ``Commission'') the 
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.
---------------------------------------------------------------------------

    \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 extend a pilot program to quote and to 
trade certain options classes in penny increments (``Penny Pilot 
Program'').
    The text of the proposed rule change is available on the Exchange's 
Web site at www.ise.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
    Under the Penny Pilot Program, the minimum price variation for all 
participating options classes, except for the Nasdaq-100 Index Tracking 
Stock (``QQQQ''), the SPDR S&P 500 Exchange Traded Fund (``SPY'') and 
the iShares Russell 2000 Index Fund (``IWM''), is $0.01 for all 
quotations in options series that are quoted at less than $3 per 
contract and $0.05 for all quotations in options series that are quoted 
at $3 per contract or greater. QQQQ, SPY and IWM are quoted in $0.01 
increments for all options series. The Penny Pilot Program is currently 
scheduled to expire on June 30, 2017.\3\ The Exchange proposes to 
extend the Penny Pilot Program through December 31, 2017, and to 
provide a revised date for adding replacement issues to the Penny Pilot 
Program. The Exchange proposes that any Penny Pilot Program issues that 
have been delisted may be replaced on the second trading day following 
July 1, 2017. The replacement issues will be selected based on trading 
activity for the most recent six month period excluding the month 
immediately preceding the replacement (i.e., beginning December 1, 
2016, and ending May 31, 2017). This filing does not propose any 
substantive changes to the Penny Pilot Program: All classes currently 
participating will remain the same and all minimum increments will 
remain unchanged. The Exchange believes the benefits to public 
customers and other market participants who will be able to express 
their true prices to buy and sell options have been demonstrated to 
outweigh any increase in quote traffic.
---------------------------------------------------------------------------

    \3\ See Exchange Act Release No. 79721 (January 3, 2017), 82 FR 
2433 (January 9, 2017) (SR-ISE-2016-32).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder that are applicable to a national securities exchange, and, 
in particular, with the requirements of Section 6(b) of the Act.\4\ 
Specifically, the proposed rule change is consistent with Section 
6(b)(5) of the Act,\5\ because it is designed to promote just and 
equitable principles of trade, remove impediments to and perfect the

[[Page 26169]]

mechanisms of a free and open market and a national market system and, 
in general, to protect investors and the public interest. In 
particular, the proposed rule change, which extends the Penny Pilot 
Program for an additional six months, will enable public customers and 
other market participants to express their true prices to buy and sell 
options to the benefit of all market participants.
---------------------------------------------------------------------------

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

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

    In accordance with Section 6(b)(8) of the Act,\6\ the Exchange does 
not believe that the proposed rule change will impose any burden on 
intermarket or intramarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. Specifically, 
the Exchange believes that, by extending the expiration of the Penny 
Pilot Program, the proposed rule change will allow for further analysis 
of the Penny Pilot Program and a determination of how the Penny Pilot 
Program should be structured in the future. In doing so, the proposed 
rule change will also serve to promote regulatory clarity and 
consistency, thereby reducing burdens on the marketplace and 
facilitating investor protection.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

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)(iii) of the Act \7\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\8\
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    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: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) 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 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-ISE-2017-48 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
    All submissions should refer to File Number SR-ISE-2017-48. 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-ISE-2017-48 and 
should be submitted on or before June 27, 2017.
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-11611 Filed 6-5-17; 8:45 am]
 BILLING CODE 8011-01-P
26168 Federal Register / Vol. 82, No. 107 / Tuesday, June 6, 2017 / Notices

action is necessary or appropriate in the For the Commission, by the Division of the most significant aspects of such
public interest, for the protection of Trading and Markets, pursuant to delegated statements.
investors, or otherwise in furtherance of authority.61
Eduardo A. Aleman, A. Self-Regulatory Organization’s
the purposes of the Act. Statement of the Purpose of, and
Assistant Secretary.
IV. Solicitation of Comments Statutory Basis for, the Proposed Rule
[FR Doc. 2017–11606 Filed 6–5–17; 8:45 am]
Change
Interested persons are invited to BILLING CODE 8011–01–P

submit written data, views and 1. Purpose
arguments concerning the foregoing, Under the Penny Pilot Program, the
including whether the proposal is SECURITIES AND EXCHANGE minimum price variation for all
consistent with the Act. Comments may COMMISSION participating options classes, except for
be submitted by any of the following [Release No. 34–80827; File No. SR–ISE– the Nasdaq-100 Index Tracking Stock
methods: 2017–48] (‘‘QQQQ’’), the SPDR S&P 500 Exchange
Traded Fund (‘‘SPY’’) and the iShares
Electronic Comments Self-Regulatory Organizations; Nasdaq Russell 2000 Index Fund (‘‘IWM’’), is
ISE, LLC; Notice of Filing and $0.01 for all quotations in options series
• Use the Commission’s Internet Immediate Effectiveness of Proposed that are quoted at less than $3 per
comment form (http://www.sec.gov/ Rule Change To Extend a Pilot contract and $0.05 for all quotations in
rules/sro.shtml); or Program To Quote and To Trade options series that are quoted at $3 per
• Send an email to rule-comments@ Certain Options Classes in Penny contract or greater. QQQQ, SPY and
sec.gov. Please include File Number SR– Increments IWM are quoted in $0.01 increments for
BatsBZX–2017–38 on the subject line. all options series. The Penny Pilot
May 31, 2017.
Program is currently scheduled to
Paper Comments Pursuant to Section 19(b)(1) of the expire on June 30, 2017.3 The Exchange
Securities Exchange Act of 1934 proposes to extend the Penny Pilot
• Send paper comments in triplicate (‘‘Act’’),1 and Rule 19b–4 thereunder,2
to Secretary, Securities and Exchange Program through December 31, 2017,
notice is hereby given that on May 25, and to provide a revised date for adding
Commission, 100 F Street NE., 2017, Nasdaq ISE, LLC (‘‘ISE’’ or
Washington, DC 20549–1090. replacement issues to the Penny Pilot
‘‘Exchange’’) filed with the Securities Program. The Exchange proposes that
All submissions should refer to File and Exchange Commission (‘‘SEC’’ or any Penny Pilot Program issues that
Number SR–BatsBZX–2017–38. This file ‘‘Commission’’) the proposed rule have been delisted may be replaced on
number should be included on the change as described in Items I, II, and the second trading day following July 1,
subject line if email is used. To help the III, below, which Items have been 2017. The replacement issues will be
Commission process and review your prepared by the Exchange. The selected based on trading activity for the
comments more efficiently, please use Commission is publishing this notice to most recent six month period excluding
only one method. The Commission will solicit comments on the proposed rule the month immediately preceding the
post all comments on the Commission’s change from interested persons. replacement (i.e., beginning December
Internet Web site (http://www.sec.gov/ I. Self-Regulatory Organization’s 1, 2016, and ending May 31, 2017). This
rules/sro.shtml). Copies of the Statement of the Terms of Substance of filing does not propose any substantive
submission, all subsequent the Proposed Rule Change changes to the Penny Pilot Program: All
amendments, all written statements classes currently participating will
with respect to the proposed rule The Exchange proposes to extend a remain the same and all minimum
change that are filed with the pilot program to quote and to trade increments will remain unchanged. The
Commission, and all written certain options classes in penny Exchange believes the benefits to public
communications relating to the increments (‘‘Penny Pilot Program’’). customers and other market participants
proposed rule change between the The text of the proposed rule change
who will be able to express their true
Commission and any person, other than is available on the Exchange’s Web site
prices to buy and sell options have been
those that may be withheld from the at www.ise.com, at the principal office
demonstrated to outweigh any increase
public in accordance with the of the Exchange, and at the
in quote traffic.
provisions of 5 U.S.C. 552, will be Commission’s Public Reference Room.
2. Statutory Basis
available for Web site viewing and II. Self-Regulatory Organization’s
printing in the Commission’s Public Statement of the Purpose of, and The Exchange believes that the
Reference Room, 100 F Street NE., Statutory Basis for, the Proposed Rule proposed rule change is consistent with
Washington, DC 20549, on official Change the requirements of the Act and the
business days between the hours of rules and regulations thereunder that
In its filing with the Commission, the are applicable to a national securities
10:00 a.m. and 3:00 p.m. Copies of such
Exchange included statements exchange, and, in particular, with the
filing will also be available for
concerning the purpose of and basis for requirements of Section 6(b) of the Act.4
inspection and copying at the principal
the proposed rule change and discussed Specifically, the proposed rule change is
office of the Exchange. All comments
any comments it received on the consistent with Section 6(b)(5) of the
received will be posted without change;
proposed rule change. The text of these Act,5 because it is designed to promote
the Commission does not edit personal
mstockstill on DSK30JT082PROD with NOTICES

statements may be examined at the just and equitable principles of trade,
identifying information from
places specified in Item IV below. The remove impediments to and perfect the
submissions. You should submit only
Exchange has prepared summaries, set
information that you wish to make
forth in sections A, B, and C below, of 3 See Exchange Act Release No. 79721 (January 3,
available publicly. All submissions
2017), 82 FR 2433 (January 9, 2017) (SR–ISE–2016–
should refer to File Number SR– 61 17 CFR 200.30–3(a)(12). 32).
BatsBZX–2017–38 and should be 1 15 U.S.C. 78s(b)(1). 4 15 U.S.C. 78f(b).
submitted on or before June 27, 2017. 2 17 CFR 240.19b–4. 5 15 U.S.C. 78f(b)(5).

VerDate Sep<11>2014 20:52 Jun 05, 2017 Jkt 241001 PO 00000 Frm 00127 Fmt 4703 Sfmt 4703 E:\FR\FM\06JNN1.SGM 06JNN1
Federal Register / Vol. 82, No. 107 / Tuesday, June 6, 2017 / Notices 26169

mechanisms of a free and open market it appears to the Commission that such All submissions should refer to File
and a national market system and, in action is: (i) Necessary or appropriate in Number SR–ISE–2017–48 and should be
general, to protect investors and the the public interest; (ii) for the protection submittedon or before June 27, 2017.
public interest. In particular, the of investors; or (iii) otherwise in For the Commission, by the Division of
proposed rule change, which extends furtherance of the purposes of the Act. Trading and Markets, pursuant to delegated
the Penny Pilot Program for an If the Commission takes such action, the authority.9
additional six months, will enable Commission shall institute proceedings Eduardo A. Aleman,
public customers and other market to determine whether the proposed rule Assistant Secretary.
participants to express their true prices should be approved or disapproved. [FR Doc. 2017–11611 Filed 6–5–17; 8:45 am]
to buy and sell options to the benefit of
all market participants. IV. Solicitation of Comments BILLING CODE 8011–01–P

B. Self-Regulatory Organization’s Interested persons are invited to
Statement on Burden on Competition submit written data, views, and SECURITIES AND EXCHANGE
arguments concerning the foregoing, COMMISSION
In accordance with Section 6(b)(8) of including whether the proposed rule
the Act,6 the Exchange does not believe change is consistent with the Act. [Release No. 34–80823; File No. SR–MRX–
that the proposed rule change will 2017–06]
Comments may be submitted by any of
impose any burden on intermarket or the following methods:
intramarket competition that is not Self-Regulatory Organizations; Nasdaq
necessary or appropriate in furtherance Electronic Comments MRX, LLC; Notice of Filing and
of the purposes of the Act. Specifically, Immediate Effectiveness of Proposed
• Use the Commission’s Internet Rule Change To Extend a Pilot
the Exchange believes that, by extending comment form (http://www.sec.gov/
the expiration of the Penny Pilot Program To Quote and To Trade
rules/sro.shtml); or Certain Options Classes in Penny
Program, the proposed rule change will • Send an email to rule-comments@
allow for further analysis of the Penny Increments
sec.gov. Please include File Number SR–
Pilot Program and a determination of ISE–2017–48 on the subject line. May 31, 2017.
how the Penny Pilot Program should be Pursuant to Section 19(b)(1) of the
structured in the future. In doing so, the Paper Comments
Securities Exchange Act of 1934
proposed rule change will also serve to • Send paper comments in triplicate (‘‘Act’’),1 and Rule 19b–4 thereunder,2
promote regulatory clarity and to Secretary, Securities and Exchange notice is hereby given that on May 25,
consistency, thereby reducing burdens Commission, 100 F Street NE., 2017, Nasdaq MRX, LLC (‘‘MRX’’ or
on the marketplace and facilitating Washington, DC 20549–1090. ‘‘Exchange’’) filed with the Securities
investor protection. All submissions should refer to File and Exchange Commission (‘‘SEC’’ or
C. Self-Regulatory Organization’s Number SR–ISE–2017–48. This file ‘‘Commission’’) the proposed rule
Statement on Comments on the number should be included on the change as described in Items I, II, and
Proposed Rule Change Received From subject line if email is used. To help the III, below, which Items have been
Members, Participants, or Others Commission process and review your prepared by the Exchange. The
No written comments were either comments more efficiently, please use Commission is publishing this notice to
solicited or received. only one method. The Commission will solicit comments on the proposed rule
post all comments on the Commission’s change from interested persons.
III. Date of Effectiveness of the Internet Web site (http://www.sec.gov/
Proposed Rule Change and Timing for I. Self-Regulatory Organization’s
rules/sro.shtml).
Commission Action Statement of the Terms of Substance of
Copies of the submission, all the Proposed Rule Change
Because the foregoing proposed rule subsequent amendments, all written
change does not: (i) Significantly affect statements with respect to the proposed The Exchange proposes to extend a
the protection of investors or the public rule change that are filed with the pilot program to quote and to trade
interest; (ii) impose any significant Commission, and all written certain options classes in penny
burden on competition; and (iii) become communications relating to the increments (‘‘Penny Pilot Program’’).
operative for 30 days from the date on proposed rule change between the The text of the proposed rule change
which it was filed, or such shorter time Commission and any person, other than is available on the Exchange’s Web site
as the Commission may designate, it has those that may be withheld from the at www.ise.com, at the principal office
become effective pursuant to Section public in accordance with the of the Exchange, and at the
19(b)(3)(A)(iii) of the Act 7 and provisions of 5 U.S.C. 552, will be Commission’s Public Reference Room.
subparagraph (f)(6) of Rule 19b–4 available for Web site viewing and II. Self-Regulatory Organization’s
thereunder.8 printing in the Commission’s Public Statement of the Purpose of, and
At any time within 60 days of the Reference Room, 100 F Street NE., Statutory Basis for, the Proposed Rule
filing of the proposed rule change, the Washington, DC 20549, on official Change
Commission summarily may business days between the hours of
temporarily suspend such rule change if In its filing with the Commission, the
10:00 a.m. and 3:00 p.m. Copies of the
Exchange included statements
filing also will be available for
6 15 U.S.C. 78f(b)(8). concerning the purpose of and basis for
inspection and copying at the principal
mstockstill on DSK30JT082PROD with NOTICES

7 15 U.S.C. 78s(b)(3)(A)(iii). the proposed rule change and discussed
office of the Exchange. All comments
8 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– any comments it received on the
received will be posted without change;
4(f)(6) requires a self-regulatory organization to give proposed rule change. The text of these
the Commission written notice of its intent to file the Commission does not edit personal
statements may be examined at the
the proposed rule change at least five business days identifying information from
prior to the date of filing of the proposed rule submissions. You should submit only 9 17 CFR 200.30–3(a)(12).
change, or such shorter time as designated by the
Commission. The Exchange has satisfied this
information that you wish to make 1 15 U.S.C. 78s(b)(1).
requirement. available publicly. 2 17 CFR 240.19b–4.

VerDate Sep<11>2014 20:52 Jun 05, 2017 Jkt 241001 PO 00000 Frm 00128 Fmt 4703 Sfmt 4703 E:\FR\FM\06JNN1.SGM 06JNN1
Document Created: 2017-06-06 06:20:49
Document Modified: 2017-06-06 06:20:49
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 26168