82 FR 44008 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees Schedule

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 181 (September 20, 2017)

Page Range		44008-44010
FR Document		2017-19966
Federal Register, Volume 82 Issue 181 (Wednesday, September 20, 2017)
[Federal Register Volume 82, Number 181 (Wednesday, September 20, 2017)]
[Notices]
[Pages 44008-44010]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-19966]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81614; File No. SR-CBOE-2017-060]


Self-Regulatory Organizations; Chicago Board Options Exchange, 
Incorporated; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend the Fees Schedule

September 14, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on September 1, 2017, Chicago Board Options Exchange, Incorporated 
(the ``Exchange'' or ``CBOE'') filed with the Securities and Exchange 
Commission (the ``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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Fees Schedule. Specifically, the 
Exchange proposes to adopt a discount in the form of a cap on 
transaction fees for Market-Maker, Broker-Dealer, Non-Trading Permit 
Holder Market-Maker, Professional/Voluntary Professional and Joint 
Back-Office executions in VIX.
    The text of the proposed rule change is also available on the 
Exchange's Web site (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Fees Schedule. Specifically, the 
Exchange proposes to adopt a discount in the form of a cap on 
transaction fees for Market-Maker, Broker-Dealer, Non-Trading Permit 
Holder Market-Maker, Professional/Voluntary Professional and Joint 
Back-Office (i.e., ``M'', ``B'', ``N'', ``W'' and ``J'' origin codes) 
executions in VIX (the ``VIX Large Trade Discount''). Particularly, 
regular transaction fees will only be charged for up to 250,000 VIX 
options contracts per order for Market-Makers, Broker-Dealers, Non-
Trading Permit Holder Market-Makers, Professional/Voluntary 
Professionals and Joint Back-Offices.\3\ The Exchange notes that the 
proposed VIX Large Trade Discount is similar to the Customer Large 
Trade Discount (``CLTD'') program which places a cap on the quantity of 
Customer contracts (i.e., ``C'' origin code) that are assessed 
transaction fees in certain options classes, including VIX.\4\ Like the 
CLTD program, the Large Trade Discount will apply both in the Regular 
Trading Hours (``RTH'') Session and the Extended Trading Hours 
(``ETH'') Session, but for an order to be eligible to qualify for the 
discount, the order in its entirety must be executed in either RTH or 
ETH, but not both).\5\ Also

[[Page 44009]]

like the CLTD program, qualification of an order for the fee cap is 
based on the trade date and order ID on each order. For complex orders, 
the total contracts of an order (all legs by underlying symbol) are 
counted for purposes of calculating the fee cap. To qualify for the 
discount, the entire order quantity must be tied to a single order ID 
(unless the order is a complex order with a number of legs that exceeds 
system limitations) either within the CBOE Command system or PULSe or 
in the front end system used to enter and/or transmit the order 
(provided the Exchange is granted access to effectively audit such 
front end system) (the order must be entered in its entirety on one 
system so that the Exchange can clearly identify the total size of the 
order). For an order entered via PULSe or another front end system, or 
a complex order with multiple order IDs, a request must be submitted to 
the Exchange within 3 business days of the transactions and must 
identify all necessary information, including the order ID and related 
trade details. Lastly, as noted above, only regular transaction fees 
are capped. To avoid potential confusion, however the Exchange proposes 
to make clear that floor brokerage fees are not subject to the cap on 
fees.
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    \3\ The discount will be on transaction fees only. Other fees, 
such as the Index License Surcharge, will not be discounted.
    \4\ See CBOE's Fees Schedule, Customer Large Trade Discount 
program.
    \5\ The Exchange notes that the trading sessions has separate 
order books and require separate logins for access, and as there is 
no ``rolling'' of orders by the Exchange between the two sessions, 
in order to be eligible to qualify for the VIX Large Trade Discount, 
an order must be executed in its entirety in either RTH or ETH, but 
not partly in both.
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    The Exchange proposes to adopt the VIX Large Trade Discount in 
order to incentivize the sending of large VIX orders. The greater 
liquidity and trading volume that the proposed cap encourages would 
benefit all market participants trading VIX options.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations thereunder applicable to the Exchange and, in particular, 
the requirements of Section 6(b) of the Act.\6\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \7\ requirements that the rules of an exchange be 
designed to prevent fraudulent and manipulative acts and practices, to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in regulating, clearing, 
settling, processing information with respect to, and facilitating 
transactions in securities, to remove impediments to and perfect the 
mechanism of a free and open market and a national market system, and, 
in general, to protect investors and the public interest. The Exchange 
also believes the proposed rule change is consistent with Section 
6(b)(4) of the Act,\8\ which provides that Exchange rules may provide 
for the equitable allocation of reasonable dues, fees, and other 
charges among its Trading Permit Holders.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
    \8\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that adopting the VIX Large Trade Discount is 
reasonable because Market-Makers, Broker-Dealers, Non-Trading Permit 
Holder Market-Makers, Professional/Voluntary Professionals and Joint 
Back-Offices participants (i.e., non-Customer, non-Firm market 
participants) will receive a discount for very large trades that they 
would not otherwise receive, which promotes and encourages larger VIX 
executions on the Exchange. This change is equitable and not unfairly 
discriminatory because all non-Customer, non-Firm market participants 
whose large trades qualify for the discount in VIX will receive it. The 
Exchange believes it's equitable and not unfairly discriminatory to 
adopt a cap on transaction fees for VIX and not other products because 
the Exchange desires to encourage VIX trading, which, along with 
bringing greater VIX options trading opportunities to all market 
participants [sic]. The Exchange believes that it is not unfairly 
discriminatory to not apply the proposed cap to Customers, as Customers 
are eligible for a discount on VIX discount under the CLTD program. The 
Exchange believes that it is not unfairly discriminatory to not apply 
the proposed VIX Large Trade Discount program to Firms (i.e., Clearing 
Trading Holder Proprietary, ``F'' and ``L'' origin codes), as Firms are 
eligible for discounts on VIX under the CBOE Clearing Trading Permit 
Holder Proprietary Products Sliding Scales.

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

    CBOE does not believe that the proposed rule change will impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because, while the cap does not 
apply to Customers and Firms, other incentive programs already exist 
for those market participants with respect to VIX trading. 
Additionally, the proposed change is designed to encourage increased 
VIX options volume, which provides greater trading opportunities for 
all market participants. The Exchange believes that the proposed rule 
change will not cause an unnecessary burden on intermarket competition 
because VIX is only traded on CBOE. To the extent that the proposed 
changes make CBOE a more attractive marketplace for market participants 
at other exchanges, such market participants are welcome to become CBOE 
market participants.

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

    The Exchange neither solicited nor received comments on the 
proposed rule change.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \9\ and paragraph (f) of Rule 19b-4 \10\ 
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 will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f).
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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-CBOE-2017-060 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-CBOE-2017-060. 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

[[Page 44010]]

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-CBOE-2017-060 and should be 
submitted on or before October 11, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-19966 Filed 9-19-17; 8:45 am]
 BILLING CODE 8011-01-P
44008 Federal Register / Vol. 82, No. 181 / Wednesday, September 20, 2017 / Notices

the competitive product list, or the Timothy J. Schwuchow; Comments Due: CBOELegalRegulatoryHome.aspx), at
modification of an existing product September 22, 2017. the Exchange’s Office of the Secretary,
currently appearing on the market 3. Docket No(s).: CP2017–309; Filing and at the Commission’s Public
dominant or the competitive product Title: Notice of United States Postal Reference Room.
list. Service of Filing a Functionally
II. Self-Regulatory Organization’s
Section II identifies the docket Equivalent Global Expedited Package
Statement of the Purpose of, and
number(s) associated with each Postal Services 3 Negotiated Service
Statutory Basis for, the Proposed Rule
Service request, the title of each Postal Agreement and Application for Non- Change
Service request, the request’s acceptance Public Treatment of Materials Filed
date, and the authority cited by the Under Seal; Filing Acceptance Date: In its filing with the Commission, the
Postal Service for each request. For each September 14, 2017; Filing Authority: 39 Exchange included statements
request, the Commission appoints an CFR 3015.5; Public Representative: concerning the purpose of and basis for
officer of the Commission to represent Jennaca D. Upperman; Comments Due: the proposed rule change and discussed
the interests of the general public in the September 22, 2017. any comments it received on the
proceeding, pursuant to 39 U.S.C. 505 proposed rule change. The text of these
This notice will be published in the statements may be examined at the
(Public Representative). Section II also Federal Register.
establishes comment deadline(s) places specified in Item IV below. The
Stacy L. Ruble, Exchange has prepared summaries, set
pertaining to each request. Secretary. forth in sections A, B, and C below, of
The public portions of the Postal [FR Doc. 2017–20027 Filed 9–19–17; 8:45 am] the most significant aspects of such
Service’s request(s) can be accessed via
BILLING CODE 7710–FW–P statements.
the Commission’s Web site (http://
www.prc.gov). Non-public portions of A. Self-Regulatory Organization’s
the Postal Service’s request(s), if any, Statement of the Purpose of, and
can be accessed through compliance SECURITIES AND EXCHANGE Statutory Basis for, the Proposed Rule
with the requirements of 39 CFR COMMISSION Change
3007.40. [Release No. 34–81614; File No. SR–CBOE–
2017–060]
1. Purpose
The Commission invites comments on
whether the Postal Service’s request(s) The Exchange proposes to amend its
in the captioned docket(s) are consistent Self-Regulatory Organizations; Fees Schedule. Specifically, the
with the policies of title 39. For Chicago Board Options Exchange, Exchange proposes to adopt a discount
request(s) that the Postal Service states Incorporated; Notice of Filing and in the form of a cap on transaction fees
concern market dominant product(s), Immediate Effectiveness of a Proposed for Market-Maker, Broker-Dealer, Non-
applicable statutory and regulatory Rule Change To Amend the Fees Trading Permit Holder Market-Maker,
requirements include 39 U.S.C. 3622, 39 Schedule Professional/Voluntary Professional and
U.S.C. 3642, 39 CFR part 3010, and 39 Joint Back-Office (i.e., ‘‘M’’, ‘‘B’’, ‘‘N’’,
September 14, 2017.
CFR part 3020, subpart B. For request(s) ‘‘W’’ and ‘‘J’’ origin codes) executions in
Pursuant to Section 19(b)(1) of the VIX (the ‘‘VIX Large Trade Discount’’).
that the Postal Service states concern Securities Exchange Act of 1934 (the
competitive product(s), applicable Particularly, regular transaction fees
‘‘Act’’),1 and Rule 19b–4 thereunder,2 will only be charged for up to 250,000
statutory and regulatory requirements notice is hereby given that on
include 39 U.S.C. 3632, 39 U.S.C. 3633, VIX options contracts per order for
September 1, 2017, Chicago Board Market-Makers, Broker-Dealers, Non-
39 U.S.C. 3642, 39 CFR part 3015, and Options Exchange, Incorporated (the
39 CFR part 3020, subpart B. Comment Trading Permit Holder Market-Makers,
‘‘Exchange’’ or ‘‘CBOE’’) filed with the Professional/Voluntary Professionals
deadline(s) for each request appear in Securities and Exchange Commission
section II. and Joint Back-Offices.3 The Exchange
(the ‘‘Commission’’) the proposed rule notes that the proposed VIX Large Trade
II. Docketed Proceeding(s) change as described in Items I, II, and Discount is similar to the Customer
III below, which Items have been Large Trade Discount (‘‘CLTD’’) program
1. Docket No(s).: CP2017–307; Filing prepared by the Exchange. The
Title: Notice of United States Postal which places a cap on the quantity of
Commission is publishing this notice to Customer contracts (i.e., ‘‘C’’ origin
Service of Filing a Functionally solicit comments on the proposed rule
Equivalent Global Expedited Package code) that are assessed transaction fees
change from interested persons. in certain options classes, including
Services 8 Negotiated Service
Agreement and Application for Non- I. Self-Regulatory Organization’s VIX.4 Like the CLTD program, the Large
Public Treatment of Materials Filed Statement of the Terms of Substance of Trade Discount will apply both in the
Under Seal; Filing Acceptance Date: the Proposed Rule Change Regular Trading Hours (‘‘RTH’’) Session
September 14, 2017; Filing Authority: 39 and the Extended Trading Hours
The Exchange proposes to amend its
CFR 3015.5; Public Representative: (‘‘ETH’’) Session, but for an order to be
Fees Schedule. Specifically, the
Timothy J. Schwuchow; Comments Due: eligible to qualify for the discount, the
Exchange proposes to adopt a discount
September 22, 2017. order in its entirety must be executed in
in the form of a cap on transaction fees
2. Docket No(s).: CP2017–308; Filing either RTH or ETH, but not both).5 Also
for Market-Maker, Broker-Dealer, Non-
Title: Notice of United States Postal Trading Permit Holder Market-Maker, 3 The discount will be on transaction fees only.
Service of Filing a Functionally
sradovich on DSKBBY8HB2PROD with NOTICES

Professional/Voluntary Professional and Other fees, such as the Index License Surcharge,
Equivalent Global Expedited Package Joint Back-Office executions in VIX. will not be discounted.
Services 8 Negotiated Service The text of the proposed rule change 4 See CBOE’s Fees Schedule, Customer Large

Agreement and Application for Non- is also available on the Exchange’s Web Trade Discount program.
5 The Exchange notes that the trading sessions has
Public Treatment of Materials Filed site (http://www.cboe.com/AboutCBOE/ separate order books and require separate logins for
Under Seal; Filing Acceptance Date: access, and as there is no ‘‘rolling’’ of orders by the
September 14, 2017; Filing Authority: 39 1 15 U.S.C. 78s(b)(1). Exchange between the two sessions, in order to be
CFR 3015.5; Public Representative: 2 17 CFR 240.19b–4. eligible to qualify for the VIX Large Trade Discount,

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Federal Register / Vol. 82, No. 181 / Wednesday, September 20, 2017 / Notices 44009

like the CLTD program, qualification of investors and the public interest. The on CBOE. To the extent that the
an order for the fee cap is based on the Exchange also believes the proposed proposed changes make CBOE a more
trade date and order ID on each order. rule change is consistent with Section attractive marketplace for market
For complex orders, the total contracts 6(b)(4) of the Act,8 which provides that participants at other exchanges, such
of an order (all legs by underlying Exchange rules may provide for the market participants are welcome to
symbol) are counted for purposes of equitable allocation of reasonable dues, become CBOE market participants.
calculating the fee cap. To qualify for fees, and other charges among its
the discount, the entire order quantity Trading Permit Holders. C. Self-Regulatory Organization’s
must be tied to a single order ID (unless The Exchange believes that adopting Statement on Comments on the
the order is a complex order with a the VIX Large Trade Discount is Proposed Rule Change Received From
number of legs that exceeds system reasonable because Market-Makers, Members, Participants, or Others
limitations) either within the CBOE Broker-Dealers, Non-Trading Permit The Exchange neither solicited nor
Command system or PULSe or in the Holder Market-Makers, Professional/ received comments on the proposed
front end system used to enter and/or Voluntary Professionals and Joint Back- rule change.
transmit the order (provided the Offices participants (i.e., non-Customer,
III. Date of Effectiveness of the
Exchange is granted access to effectively non-Firm market participants) will
Proposed Rule Change and Timing for
audit such front end system) (the order receive a discount for very large trades
that they would not otherwise receive, Commission Action
must be entered in its entirety on one
system so that the Exchange can clearly which promotes and encourages larger The foregoing rule change has become
identify the total size of the order). For VIX executions on the Exchange. This effective pursuant to Section 19(b)(3)(A)
an order entered via PULSe or another change is equitable and not unfairly of the Act 9 and paragraph (f) of Rule
front end system, or a complex order discriminatory because all non- 19b–4 10 thereunder. At any time within
with multiple order IDs, a request must Customer, non-Firm market participants 60 days of the filing of the proposed rule
be submitted to the Exchange within 3 whose large trades qualify for the change, the Commission summarily may
business days of the transactions and discount in VIX will receive it. The temporarily suspend such rule change if
must identify all necessary information, Exchange believes it’s equitable and not it appears to the Commission that such
including the order ID and related trade unfairly discriminatory to adopt a cap action is necessary or appropriate in the
details. Lastly, as noted above, only on transaction fees for VIX and not other public interest, for the protection of
regular transaction fees are capped. To products because the Exchange desires investors, or otherwise in furtherance of
avoid potential confusion, however the to encourage VIX trading, which, along the purposes of the Act. If the
Exchange proposes to make clear that with bringing greater VIX options Commission takes such action, the
floor brokerage fees are not subject to trading opportunities to all market Commission will institute proceedings
the cap on fees. participants [sic]. The Exchange to determine whether the proposed rule
The Exchange proposes to adopt the believes that it is not unfairly change should be approved or
VIX Large Trade Discount in order to discriminatory to not apply the disapproved.
incentivize the sending of large VIX proposed cap to Customers, as
Customers are eligible for a discount on IV. Solicitation of Comments
orders. The greater liquidity and trading
volume that the proposed cap VIX discount under the CLTD program. Interested persons are invited to
encourages would benefit all market The Exchange believes that it is not submit written data, views, and
participants trading VIX options. unfairly discriminatory to not apply the arguments concerning the foregoing,
proposed VIX Large Trade Discount including whether the proposed rule
2. Statutory Basis program to Firms (i.e., Clearing Trading change is consistent with the Act.
The Exchange believes the proposed Holder Proprietary, ‘‘F’’ and ‘‘L’’ origin Comments may be submitted by any of
rule change is consistent with the codes), as Firms are eligible for the following methods:
Securities Exchange Act of 1934 (the discounts on VIX under the CBOE
Electronic Comments
‘‘Act’’) and the rules and regulations Clearing Trading Permit Holder
thereunder applicable to the Exchange Proprietary Products Sliding Scales. • Use the Commission’s Internet
and, in particular, the requirements of comment form (http://www.sec.gov/
B. Self-Regulatory Organization’s rules/sro.shtml); or
Section 6(b) of the Act.6 Specifically, Statement on Burden on Competition • Send an email to rule-comments@
the Exchange believes the proposed rule
CBOE does not believe that the sec.gov. Please include File Number SR–
change is consistent with the Section
proposed rule change will impose any CBOE–2017–060 on the subject line.
6(b)(5) 7 requirements that the rules of
an exchange be designed to prevent burden on competition that is not Paper Comments
fraudulent and manipulative acts and necessary or appropriate in furtherance
of the purposes of the Act because, • Send paper comments in triplicate
practices, to promote just and equitable to Brent J. Fields, Secretary, Securities
principles of trade, to foster cooperation while the cap does not apply to
Customers and Firms, other incentive and Exchange Commission, 100 F Street
and coordination with persons engaged NE., Washington, DC 20549–1090.
in regulating, clearing, settling, programs already exist for those market
processing information with respect to, participants with respect to VIX trading. All submissions should refer to File
and facilitating transactions in Additionally, the proposed change is Number SR–CBOE–2017–060. This file
securities, to remove impediments to designed to encourage increased VIX number should be included on the
options volume, which provides greater
sradovich on DSKBBY8HB2PROD with NOTICES

and perfect the mechanism of a free and subject line if email is used. To help the
open market and a national market trading opportunities for all market Commission process and review your
system, and, in general, to protect participants. The Exchange believes that comments more efficiently, please use
the proposed rule change will not cause only one method. The Commission will
an order must be executed in its entirety in either an unnecessary burden on intermarket post all comments on the Commission’s
RTH or ETH, but not partly in both. competition because VIX is only traded
6 15 U.S.C. 78f(b). 9 15 U.S.C. 78s(b)(3)(A).
7 15 U.S.C. 78f(b)(5). 8 15 U.S.C. 78f(b)(4). 10 17 CFR 240.19b–4(f).

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44010 Federal Register / Vol. 82, No. 181 / Wednesday, September 20, 2017 / Notices

Internet Web site (http://www.sec.gov/ ‘‘Participants’’) 3 filed with the The Commission received no comments
rules/sro.shtml). Copies of the Securities and Exchange Commission in response to the proposed rule
submission, all subsequent (‘‘Commission’’), pursuant to Section changes. On September 6, 2017, CHX
amendments, all written statements 19(b)(1) of the Securities Exchange Act filed Amendment No. 1 to its proposed
with respect to the proposed rule of 1934 (‘‘Act’’) 4 and Rule 19b–4 rule change,11 and on September 13,
change that are filed with the thereunder,5 proposed rule changes to 2017, FINRA filed Amendment No. 2 to
Commission, and all written establish the procedures for resolving its proposed rule change.12 This order
communications relating to the potential disputes related to CAT Fees approves the proposed rule changes, as
proposed rule change between the charged to Industry Members.6 The modified by the Amendments.13
Commission and any person, other than proposed rule change submitted by CHX
II. Description of the Proposed Rule
those that may be withheld from the was published for comment in the
Changes, as Modified by the
public in accordance with the Federal Register on June 19, 2017.7 The
Amendments 14
provisions of 5 U.S.C. 552, will be proposed rule change submitted by
available for Web site viewing and FINRA was published for comment in The Participants filed with the
printing in the Commission’s Public the Federal Register on July 6, 2017.8 Commission, pursuant to Section 11A of
Reference Room, 100 F Street NE., Pursuant to Section 19(b)(2) of the Act,9 the Act 15 and Rule 608 of Regulation
Washington, DC 20549, on official the Commission designated a longer
period within which to approve, also Securities Exchange Act Release No. 81110
business days between the hours of (July 10, 2017), 82 FR 32598 (July 14, 2017); 81112
10:00 a.m. and 3:00 p.m. Copies of the disapprove, or institute proceedings to (July 10, 2017), 82 FR 32592 (July 14, 2017); 81113
filing also will be available for determine whether to approve or (July 10, 2017), 82 FR 32596 (July 14, 2017); 81156
inspection and copying at the principal disapprove the proposed rule changes.10 (July 18, 2017), 82 FR 34337 (July 24, 2017); 81157
(July 18, 2017), 82 FR 34338 (July 24, 2017); 81158
office of the Exchange. All comments (July 18, 2017), 82 FR 34339 (July 24, 2017); 81159
3 The Commission notes that Bats BYX Exchange,
received will be posted without change; (July 18, 2017), 82 FR 34338 (July 24, 2017); 81161
Inc. (‘‘Bats BYX’’), Bats BZX Exchange, Inc. (‘‘Bats
the Commission does not edit personal BZX’’), Bats EDGA Exchange, Inc. (‘‘Bats EDGA’’),
(July 18, 2017), 82 FR 34337 (July 24, 2017); 81162
(July 18, 2017), 82 FR 34336 (July 24, 2017); 81164
identifying information from Bats EDGX Exchange, Inc. (‘‘Bats EDGX’’), BOX (July 18, 2017), 82 FR 34346 (July 24, 2017); 81165
submissions. You should submit only Options Exchange LLC (‘‘BOX’’), C2 Options (July 18, 2017), 82 FR 34345 (July 24, 2017); 81166
information that you wish to make Exchange, Inc., Chicago Board Options Exchange, (July 18, 2017), 82 FR 34345 (July 24, 2017); 81167
Incorporated (‘‘CBOE’’), Investors Exchange LLC (July 18, 2017), 82 FR 34337 (July 24, 2017); 81178
available publicly. All submissions (‘‘IEX’’), Nasdaq ISE, LLC (‘‘ISE’’), Nasdaq MRX, (July 20, 2017), 82 FR 34715 (July 26, 2017); 81179
should refer to File Number SR–CBOE– LLC (‘‘MRX’’), Miami International Securities (July 20, 2017), 82 FR 34716 (July 26, 2017); 81180
2017–060 and should be submitted on Exchange, LLC (‘‘MIAX’’), MIAX PEARL, LLC, The (July 20, 2017), 82 FR 34728 (July 26, 2017); and
or before October 11, 2017. NASDAQ Stock Market LLC (‘‘Nasdaq’’), NASDAQ 81181 (July 20, 2017), 82 FR 34727 (July 26, 2017).
BX, Inc. (‘‘BX’’), Nasdaq GEMX, LLC (‘‘GEMX’’), 11 Amendment No. 1 is available on the
For the Commission, by the Division of NASDAQ PHLX LLC (‘‘Phlx’’), New York Stock Commission’s Web site for CHX at: https://
Trading and Markets, pursuant to delegated Exchange LLC (‘‘NYSE’’), NYSE Arca, Inc. (‘‘NYSE www.sec.gov/comments/sr-chx-2017-11/chx201711-
authority.11 Arca’’), NYSE MKT LLC (‘‘NYSE MKT’’) and NYSE 2433023-161039.pdf.
National, Inc. are also deemed ‘‘Participants’’ for 12 Amendment No. 2 replaced and superseded
Eduardo A. Aleman, purposes of this Order as they, like CHX and Amendment No. 1 in its entirety. Amendment No.
Assistant Secretary. FINRA, are also Participants of the National Market 2 is available on the Commission’s Web site for
[FR Doc. 2017–19966 Filed 9–19–17; 8:45 am] System Plan Governing the Consolidated Audit FINRA at: https://www.sec.gov/comments/sr-finra-
Trail (‘‘CAT NMS Plan’’ or ‘‘Plan’’). See infra note 2017-020/finra2017020-2442749-161061.pdf.
BILLING CODE 8011–01–P 17. The Commission also notes that CHX refers to 13 The Amendments amended the original filings
Participants of the Plan as ‘‘Plan Participants’’ in its to make technical changes to the proposed rule
proposal. changes. Specifically, each Participant amended the
4 15 U.S.C. 78s(b)(1).
SECURITIES AND EXCHANGE proposed rule text to remove references to proposed
5 17 CFR 240.19b–4. ‘‘Consolidated Audit Trail Funding Fees,’’ as such
COMMISSION
6 Bats BYX, Bats BZX, Bats EDGA, Bats EDGX, fees are currently suspended, and replaced such
BOX, CBOE, IEX, ISE, MRX, MIAX, Nasdaq, BX, term with the phrase ‘‘any fees contemplated by the
[Release No. 34–81616; File Nos. SR–CHX– GEMX, Phlx, NYSE, NYSE Arca and NYSE MKT CAT NMS Plan and imposed on Industry Members
2017–11; SR–FINRA–2017–020] also submitted proposed rule changes to establish pursuant to [SRO] Rules.’’ See infra note 18. Each
procedures for resolving potential disputes related Participant also removed references to
to CAT Fees charged to Industry Members. See ‘‘Consolidated Audit Trail Funding Fees’’ from
Self-Regulatory Organizations; paragraphs (a)(1), (b) and (c)(1) of the proposed rule
Securities Exchange Act Release Nos. 80780 (May
Chicago Stock Exchange, Inc.; 26, 2017), 82 FR 25382 (June 1, 2017); 80781 (May text. The Amendments are not subject to notice and
Financial Industry Regulatory 26, 2017), 82 FR 25369 (June 1, 2017); 80782 (May comment because they are technical amendments
Authority, Inc.; Order Approving 26, 2017), 82 FR 25379 (June 1, 2017); 80837 (June that do not materially alter the substance of the
1, 2017), 82 FR 26526 (June 7, 2017); 80836 (June proposed rule changes or raise any novel regulatory
Proposed Rule Changes, as Modified issues. The Commission notes that on August 30,
1, 2017), 82 FR 26539 (June 7, 2017); 80834 (June
by Amendments, To Adopt a 1, 2017), 82 FR 26542 (June 7, 2017); 80835 (June
2017, the Commission approved the proposed rule
Consolidated Audit Trail Fee Dispute changes filed by the other Participants to the CAT
1, 2017), 82 FR 26549 (June 7, 2017); 80833 (June
NMS Plan to establish procedures for resolving
Resolution Process 1, 2017), 82 FR 26529 (June 7, 2017); 80831 (June
potential disputes related to CAT Fees charged to
1, 2017), 82 FR 26536 (June 7, 2017); 80832 (June
Industry Members, as modified by such
September 14, 2017. 1, 2017), 82 FR 26523 (June 7, 2017); 80936 (June amendments. See Securities Exchange Act Release
15, 2017), 82 FR 28153 (June 20, 2017); 80952 (June No. 81500 (August 30, 2017), 82 FR 42143
I. Introduction 16, 2017), 82 FR 28540 (June 22, 2017); 80967 (June (September 6, 2017) (order approving proposed rule
19, 2017), 82 FR 28719 (June 23, 2017); 80968 (June changes by Bats BYX, Bats BZX, Bats EDGA, Bats
On June 5, 2017 1 and June 19, 2017,2 19, 2017), 82 FR 28705 (June 23, 2017); 80970 (June EDGX, BOX, CBOE, IEX, ISE, MRX, MIAX, Nasdaq,
Chicago Stock Exchange, Inc. (‘‘CHX’’) 19, 2017), 82 FR 28708 (June 23, 2017); 80971 (June BX, GEMX, Phlx, NYSE, NYSE Arca and NYSE
and Financial Industry Regulatory 19, 2017), 82 FR 28698 (June 23, 2017); and 80966 MKT to adopt a Consolidated Audit Trail Fee
sradovich on DSKBBY8HB2PROD with NOTICES

Authority, Inc. (‘‘FINRA’’) (each, ‘‘SRO’’ (June 19, 2017), 82 FR 28702 (June 23, 2017). Dispute Resolution Process), at 42144 n.19. See also
7 See Securities Exchange Act Release No. 80916
or ‘‘Participant;’’ collectively, the supra note 6.
(June 13, 2017), 82 FR 27904 (‘‘Notice’’). 14 The Commission notes that for purposes of this
8 See Securities Exchange Act Release No. 81053
Order, unless otherwise specified, capitalized terms
11 17 CFR 200.30–3(a)(12). (June 29, 2017), 82 FR 31366. used in this Order are defined as set forth in the
1 Chicago Stock Exchange, Inc. filed its proposed 9 15 U.S.C. 78s(b)(2). proposals, as modified by the Amendments, or in
rule change on June 5, 2017. 10 See Securities Exchange Act Release No. 81163 the CAT NMS Plan. See supra notes 11–12; see also
2 Financial Industry Regulatory Authority, Inc. (July 18, 2017), 82 FR 34343 (July 24, 2017); 81275 infra note 17.
filed its proposed rule change on June 19, 2017. (August 1, 2017), 82 FR 36836 (August 7, 2017). See 15 15 U.S.C. 78k–1.

VerDate Sep<11>2014 18:28 Sep 19, 2017 Jkt 241001 PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 E:\FR\FM\20SEN1.SGM 20SEN1
Document Created: 2018-10-24 14:23:57
Document Modified: 2018-10-24 14:23:57
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 44008