82 FR 55895 - Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing of Proposed Rule Change To Amend the Minimum Order Size for the Floor Broker Guarantee Provided in Rule 7600(f)

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 225 (November 24, 2017)

[Federal Register Volume 82, Number 225 (Friday, November 24, 2017)]
[Notices]
[Pages 55895-55896]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-25356]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82112; File No. SR-BOX-2017-33]


Self-Regulatory Organizations; BOX Options Exchange LLC; Notice 
of Filing of Proposed Rule Change To Amend the Minimum Order Size for 
the Floor Broker Guarantee Provided in Rule 7600(f)

November 17, 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 November 6, 2017, BOX Options Exchange LLC (``Exchange'') filed with 
the Securities and Exchange Commission (``Commission'') the proposed 
rule change as described in Items I and II below, which Items have been 
prepared by the self-regulatory organization. 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 Rule 7600 to amend the minimum order 
size for the Floor Broker guarantee provided in Rule 7600(f). The text 
of the proposed rule change is available from the principal office of 
the Exchange, at the Commission's Public Reference Room and also on the 
Exchange's Internet Web site at http://boxexchange.com.

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

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of these statements may be examined at 
the places specified in Item IV below. The self-regulatory organization 
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 Rule 7600(f). Specifically, the 
Exchange is proposing to amend the minimum order size for the Floor 
Broker guarantee provided in Rule 7600(f).
    Currently, on the Trading Floor, when a Floor Broker holds an order 
of the eligible order size or greater, the Floor Broker is entitled to 
cross a certain percentage of the order with other orders that he is 
holding. The Exchange may determine, on an option by option basis, the 
eligible size for an order that may be transacted pursuant to Rule 
7600(f); however, the eligible order size may not be less than 500 
contracts. The percentage of the order which a Floor Broker is entitled 
to cross, after all equal or better priced Public Customer bids or 
offers on the BOX Book and any non-Public Customer bids or offers that 
are ranked ahead of such Public Customer bids or offers are filled, is 
40% of the remaining contracts in the order.
    The Exchange is now proposing to decrease the required minimum 
eligible order size for the Floor Broker guarantee from 500 contracts 
to 50 contracts.\3\ The proposed change would align the eligible order 
size with that of another exchange.\4\ The Exchange notes that it may 
still determine the eligible order size, provided that it is at least 
50 contracts. Changes to the eligible order size will be communicated 
to Participants via Regulatory Circular pursuant to BOX Rule 
7600(f)(2).
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    \3\ The Exchange notes that Participants have requested this 
change. The Exchange believes that the proposed change will result 
in more transactions on the BOX Trading Floor.
    \4\ See CBOE Rule 6.74(d). The Exchange notes that CBOE Rule 
6.74(d) also refers to facilitation and solicitation orders. The 
Exchange does not currently differentiate between facilitated orders 
or solicited orders on the BOX Trading Floor.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \5\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \6\ in particular, in that it is designed to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general to protect investors and the public interest. 
Specifically, the Exchange believes that the proposed change offers 
Floor Brokers a greater incentive to execute transactions on the BOX 
Trading Floor. Further, the Exchange believes that the proposed change 
is appropriate as a similar minimum eligible order size is present at 
another options exchange with a trading floor. Further, the Exchange 
believes that the proposed change will benefit market participants as 
the decreased minimum eligible order size may result in more 
transactions on the exchange.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
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    In addition, the proposed rule change would promote a free and open 
market by permitting the Exchange to compete with other options 
exchanges. In this regard, competition would result in benefits to the 
investing public. As noted above, the proposed change would align the 
eligible order size with the rules of another options exchange with an 
open outcry trading floor.\7\ As such, permitting the Exchange to 
operate on an even playing field relative to other exchanges removes 
impediments to and perfects the mechanism for a free and open market 
and a national market system.
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    \7\ See CBOE Rule 6.74(d).

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[[Page 55896]]

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. As discussed above, the 
proposed change simply aligns the eligible order size for the Floor 
Broker guarantee with that of another exchange with a trading floor. As 
such, the proposed change will allow the Exchange to compete with other 
options exchanges currently offering a reduced eligible order size with 
regard to the Floor Broker guarantee.

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

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

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

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be 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-BOX-2017-33 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-BOX-2017-33. 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. Persons submitting 
comments are cautioned that we do not redact or edit personal 
identifying information from comment submissions. You should submit 
only information that you wish to make available publicly. All 
submissions should refer to File Number SR-BOX-2017-33 and should be 
submitted on or before December 15, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-25356 Filed 11-22-17; 8:45 am]
BILLING CODE 8011-01-P