82 FR 57518 - Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Section (a)(i)(D) of Rule 1012, Series of Options Open for Trading
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 232 (December 5, 2017)
Federal Register Volume 82, Issue 232 (December 5, 2017)
| Page Range | 57518-57520 | |
| FR Document | 2017-26124 |
[Federal Register Volume 82, Number 232 (Tuesday, December 5, 2017)] [Notices] [Pages 57518-57520] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-26124] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82170; File No. SR-PHLX-2017-96] Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Section (a)(i)(D) of Rule 1012, Series of Options Open for Trading November 29, 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 17, 2017, Nasdaq PHLX LLC (``Phlx'' or ``Exchange'') filed with the Securities and Exchange Commission (``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 amend Section (a)(i)(D) of Rule 1012, Series of Options Open for Trading, to delete two sentences regarding opening for trading of long term option series, which sentences have effectively been superseded by another rule. The text of the proposed rule change is available on the Exchange's Web site at http://nasdaqphlx.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 Section (a)(i)(D) of Rule 1012 currently provides that the Exchange may list, with respect to any class of stock or Exchange-Traded Fund Share options series, options having from twelve up to thirty-nine months from the time they are listed until expiration. There may be up to six expiration months. Strike price interval, bid/ask differential and continuity rules shall not apply to such options series until the time to expiration is less than nine months. Section (a)(i)(D) also provides in its last two sentences that such option series will open for trading either when there is buying or selling interest, or 40 minutes prior to the close, whichever occurs first, and that no quotations need to be posted for such option series until they are opened for trading. The Exchange proposes to delete the outdated provision of Section (a)(i)(D) regarding the time of opening as inconsistent with, and unnecessary in view of, Rule 1017, Openings in Options, which governs in detail all openings on the Exchange, including openings in long term option series.\3\ The Exchange proposes to delete the Section (a)(i)(D) provision that no quotations need to be posted for such option series until they are opened for trading as superfluous, given that no quotations need to be posted for any series of options traded on the Exchange until they are opened for trading.\4\ --------------------------------------------------------------------------- \3\ The Exchange recently amended Rule 1017, Openings in Options, which clarified the manner in which the opening process occurs on Phlx. See Securities Exchange Act Release No. 80820 (May 31, 2017), 82 FR 26171 (June 6, 2017) (SR-Phlx-2017-40). \4\ The Exchange interprets ``posted'' in Section (a)(i)(D) as meaning published on the Options Price Reporting Authority (``OPRA''). Rule 1017(d)(iii) provides that ``[t]he Specialist assigned in a particular equity or index option must enter a Valid Width Quote, in 90% of their assigned series, not later than one minute following the dissemination of a quote or trade by the market for the underlying security or, in the case of index options, following the receipt of the opening price in the underlying index.'' The quote resulting from the Specialist's obligation under Rule 1017(d)(iii) is considered in the opening process of Rule 1017, and the Exchange publishes a quote in the option series once the option has been opened pursuant to that rule. --------------------------------------------------------------------------- Rule 1017 does provide in great detail for a fully automated opening of trading when there is buying or selling interest in all options series, including long term option series. Generally speaking, the fully automated opening process begins when either (1) a ``valid width'' specialist quote is submitted, (2) valid width quotes are received from at least two Exchange market makers within two minutes of the opening trade or quote in the underlying security or (3) after two minutes of the opening trade or quote in the underlying, valid width quotes are received from one Exchange market maker. If an opening imbalance exists outside of an acceptable range, the system will initiate an imbalance process. During this process the Exchange will consider interest on the Exchange as well as interest on away exchanges. If there is not an opening imbalance outside of an acceptable range on the Exchange, the system will verify that a ``quality opening market'' exists in order to validate the opening price prior to executing interest on the opening. A quality opening market is a bid/ask spread with an acceptable differential as defined by the Exchange. The bid/ask spread is made up of the best available bid, on the Exchange as well as away markets, and the best available offer, on the Exchange as well as away market. The acceptable bid/ask spread differentials can be found on the Exchange's Web site. Rule 1017 does not provide for the opening of long term option series 40 minutes prior to the close. The Exchange proposes to remove this inconsistent anachronism, still found in Rule 1012(A)(i)(D), as the Exchange no longer believes that long term options warrant special opening treatment but should open like other options under Rule 1017, pursuant to a fully automated process in which options open once certain precise conditions have been met. Although removing the provision that long term option series must open forty minutes prior to the close of trading even if there is no buying or selling interest, the Exchange believes it will be rare for a long term option series not to have buying or selling interest in any event, due to Exchange members' quoting obligations. [[Page 57519]] A number of exchanges' long term options series rules contain the same provisions contained in the last two sentences of Rule 1012(A)(i)(D). These provisions appear to have been put in place due to the fact that long-term series are usually very inactively traded.\5\ Although long term options series continue to be inactively traded, the Exchange no longer believes it is necessary to accommodate long term options openings in this manner, and prefers to have the procedures specified in Rule 1017 apply uniformly across options classes for the sake of efficient operation of the Exchange and the minimization of investor confusion. The Exchange believes it is counterintuitive to impose such requirements with respect to long-term series when the requirements do not apply for other series that may be opened pursuant to Rule 1017. Further, the Exchange has no systemic means to force an option to open forty minutes prior to the close. --------------------------------------------------------------------------- \5\ See, e.g., Securities Exchange Act Release No. 30010 (November 27, 1991), 56 FR 63747 (December 5, 1991) (SR-NYSE-91-33) (Filing and Order Granting Accelerated Approval of Proposed Rule Change by the New York Stock Exchange, Inc., Relating to the Listing of Long-Term Equity Options), in which the Commission found that the New York Stock Exchange's proposal to open the long-term series for trading either when there is buying or selling interest or 40 minutes prior to the close (whichever occurs first) was consistent with the approach taken by the other options exchanges and was consistent with the Act because long-term series are usually very inactively traded. See also Chicago Board Options Exchange Rule 5.8(b) and NYSE Arca Rule 6.3(e)(i), which contain the same provisions the Exchange proposes to delete. --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\6\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\7\ 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, by eliminating an outdated provision regarding opening of long term option series, thereby eliminating an internal inconsistency in the Exchange's rulebook. The language the Exchange is proposing to remove is inconsistent with Rule 1017. Permitting opening of long term options series in the same manner as all other options, under the fully automated process set forth in Rule 1017 will result in operational efficiencies for the Exchange and will minimize potential investor confusion regarding the Exchange's opening procedures. --------------------------------------------------------------------------- \6\ 15 U.S.C. 78f(b). \7\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- 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 opening process for long term option series will continue to operate in the same manner as today, pursuant to Rule 1017. The proposal does not change the intense competition that exists among the options markets for options business including on the opening. Nor does the Exchange believe that the proposal will impose any burden on intra-market competition; the opening process involves many types of participants and interest. The proposal merely removes an outdated rule provision that is inconsistent with Rule 1017. 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 \8\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\9\ --------------------------------------------------------------------------- \8\ 15 U.S.C. 78s(b)(3)(A)(iii). \9\ 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 CommentsUse 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-PHLX-2017-96 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-PHLX-2017-96. 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-PHLX-2017-96, and should be submitted on or before December 26, 2017. [[Page 57520]] For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\10\ --------------------------------------------------------------------------- \10\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-26124 Filed 12-4-17; 8:45 am] BILLING CODE 8011-01-P
![57518 Federal Register / Vol. 82, No. 232 / Tuesday, December 5, 2017 / Notices
submit only information that you wish II. Self-Regulatory Organization’s Rule 1017 does provide in great detail
to make available publicly. All Statement of the Purpose of, and for a fully automated opening of trading
submissions should refer to File Statutory Basis for, the Proposed Rule when there is buying or selling interest
Number SR–GEMX–2017–54, and Change in all options series, including long term
should be submitted on or before option series. Generally speaking, the
In its filing with the Commission, the
December 26, 2017. fully automated opening process begins
Exchange included statements
when either (1) a ‘‘valid width’’
For the Commission, by the Division of concerning the purpose of and basis for
specialist quote is submitted, (2) valid
Trading and Markets, pursuant to delegated the proposed rule change and discussed
width quotes are received from at least
authority.11 any comments it received on the
two Exchange market makers within
Eduardo A. Aleman, proposed rule change. The text of these
two minutes of the opening trade or
statements may be examined at the
Assistant Secretary. quote in the underlying security or (3)
places specified in Item IV below. The
[FR Doc. 2017–26125 Filed 12–4–17; 8:45 am] after two minutes of the opening trade
Exchange has prepared summaries, set
or quote in the underlying, valid width
BILLING CODE 8011–01–P forth in sections A, B, and C below, of
quotes are received from one Exchange
the most significant aspects of such market maker. If an opening imbalance
statements. exists outside of an acceptable range,
SECURITIES AND EXCHANGE
COMMISSION A. Self-Regulatory Organization’s the system will initiate an imbalance
Statement of the Purpose of, and process. During this process the
Statutory Basis for, the Proposed Rule Exchange will consider interest on the
[Release No. 34–82170; File No. SR–PHLX–
Change Exchange as well as interest on away
2017–96]
exchanges. If there is not an opening
1. Purpose imbalance outside of an acceptable
Self-Regulatory Organizations; Nasdaq
Section (a)(i)(D) of Rule 1012 range on the Exchange, the system will
PHLX LLC; Notice of Filing and
currently provides that the Exchange verify that a ‘‘quality opening market’’
Immediate Effectiveness of Proposed exists in order to validate the opening
may list, with respect to any class of
Rule Change To Amend Section price prior to executing interest on the
stock or Exchange-Traded Fund Share
(a)(i)(D) of Rule 1012, Series of Options options series, options having from opening. A quality opening market is a
Open for Trading twelve up to thirty-nine months from bid/ask spread with an acceptable
November 29, 2017. the time they are listed until expiration. differential as defined by the Exchange.
There may be up to six expiration The bid/ask spread is made up of the
Pursuant to Section 19(b)(1) of the months. Strike price interval, bid/ask best available bid, on the Exchange as
Securities Exchange Act of 1934 differential and continuity rules shall well as away markets, and the best
(‘‘Act’’) 1, and Rule 19b–4 thereunder,2 not apply to such options series until available offer, on the Exchange as well
notice is hereby given that on November the time to expiration is less than nine as away market. The acceptable bid/ask
17, 2017, Nasdaq PHLX LLC (‘‘Phlx’’ or months. spread differentials can be found on the
‘‘Exchange’’) filed with the Securities Section (a)(i)(D) also provides in its Exchange’s Web site.
and Exchange Commission last two sentences that such option Rule 1017 does not provide for the
(‘‘Commission’’) the proposed rule series will open for trading either when opening of long term option series 40
change as described in Items I, II, and there is buying or selling interest, or 40 minutes prior to the close. The
III, below, which Items have been minutes prior to the close, whichever Exchange proposes to remove this
prepared by the Exchange. The occurs first, and that no quotations need inconsistent anachronism, still found in
to be posted for such option series until Rule 1012(A)(i)(D), as the Exchange no
Commission is publishing this notice to
they are opened for trading. The longer believes that long term options
solicit comments on the proposed rule
Exchange proposes to delete the warrant special opening treatment but
change from interested persons. should open like other options under
outdated provision of Section (a)(i)(D)
I. Self-Regulatory Organization’s regarding the time of opening as Rule 1017, pursuant to a fully
Statement of the Terms of Substance of inconsistent with, and unnecessary in automated process in which options
the Proposed Rule Change view of, Rule 1017, Openings in open once certain precise conditions
Options, which governs in detail all have been met. Although removing the
The Exchange proposes to amend openings on the Exchange, including provision that long term option series
Section (a)(i)(D) of Rule 1012, Series of openings in long term option series.3 must open forty minutes prior to the
Options Open for Trading, to delete two The Exchange proposes to delete the close of trading even if there is no
sentences regarding opening for trading Section (a)(i)(D) provision that no buying or selling interest, the Exchange
of long term option series, which quotations need to be posted for such believes it will be rare for a long term
sentences have effectively been option series until they are opened for option series not to have buying or
superseded by another rule. trading as superfluous, given that no selling interest in any event, due to
quotations need to be posted for any Exchange members’ quoting obligations.
The text of the proposed rule change
is available on the Exchange’s Web site series of options traded on the Exchange
provides that ‘‘[t]he Specialist assigned in a
at http://nasdaqphlx.cchwallstreet.com/, until they are opened for trading.4 particular equity or index option must enter a Valid
at the principal office of the Exchange, Width Quote, in 90% of their assigned series, not
sradovich on DSK3GMQ082PROD with NOTICES
3 The Exchange recently amended Rule 1017,
later than one minute following the dissemination
and at the Commission’s Public Openings in Options, which clarified the manner in of a quote or trade by the market for the underlying
Reference Room. which the opening process occurs on Phlx. See security or, in the case of index options, following
Securities Exchange Act Release No. 80820 (May the receipt of the opening price in the underlying
31, 2017), 82 FR 26171 (June 6, 2017) (SR–Phlx– index.’’ The quote resulting from the Specialist’s
2017–40). obligation under Rule 1017(d)(iii) is considered in
11 17 CFR 200.30–3(a)(12). 4 The Exchange interprets ‘‘posted’’ in Section the opening process of Rule 1017, and the Exchange
1 15 U.S.C. 78s(b)(1). (a)(i)(D) as meaning published on the Options Price publishes a quote in the option series once the
2 17 CFR 240.19b–4. Reporting Authority (‘‘OPRA’’). Rule 1017(d)(iii) option has been opened pursuant to that rule.
VerDate Sep<11>2014 18:13 Dec 04, 2017 Jkt 244001 PO 00000 Frm 00096 Fmt 4703 Sfmt 4703 E:\FR\FM\05DEN1.SGM 05DEN1](https://thefederalregister.org/doc/82_FR_57750/page/1.svg)
![57520 Federal Register / Vol. 82, No. 232 / Tuesday, December 5, 2017 / Notices
For the Commission, by the Division of Directorate, 1515 Wilson Boulevard, (SSA)
Trading and Markets, pursuant to delegated Arlington, Virginia 22209–2425.
authority.10 A copy of the comments should be Social Security Administration, OLCA,
Eduardo A. Aleman, sent to the Office of Information and Attn: Reports Clearance Director, 3100
Assistant Secretary. Regulatory Affairs, Attention: Desk West High Rise, 6401 Security Blvd.,
[FR Doc. 2017–26124 Filed 12–4–17; 8:45 am] Officer, Selective Service System, Office Baltimore, MD 21235, Fax: 410–966–
BILLING CODE 8011–01–P of Management and Budget, New 2830, Email address:
Executive Office Building, Room 3235, OR.Reports.Clearance@ssa.gov.
Washington, DC 20503.
Or you may submit your comments
SELECTIVE SERVICE SYSTEM Dated: November 27, 2017. online through www.regulations.gov,
Donald M. Benton, referencing Docket ID Number [SSA–
Forms Submitted to the Office of Director. 2017–0065].
Management and Budget for Extension
[FR Doc. 2017–26096 Filed 12–4–17; 8:45 am] SSA submitted the information
of Clearance
BILLING CODE 8015–01–P collections below to OMB for clearance.
AGENCY: Selective Service System. Your comments regarding these
ACTION: Notice. information collections would be most
SOCIAL SECURITY ADMINISTRATION useful if OMB and SSA receive them 30
The following form has been
submitted to the Office of Management [Docket No: SSA–2017–0065] days from the date of this publication.
and Budget (OMB) for extension of To be sure we consider your comments,
clearance with change in compliance Agency Information Collection we must receive them no later than
with the Paperwork Reduction Act: Activities: Comment Request January 4, 2018. Individuals can obtain
The Social Security Administration copies of the OMB clearance packages
SSS Form 1 by writing to OR.Reports.Clearance@
(SSA) publishes a list of information
collection packages requiring clearance ssa.gov.
Title: The Selective Service System
Registration Form. by the Office of Management and 1. Letter to Employer Requesting
Purpose: Is used to register men and Budget (OMB) in compliance with Information About Wages Earned By
establish a data base for use in identifying Public Law 104–13, the Paperwork Beneficiary—20 CFR 404.1520, 20 CFR
manpower to the military services during a Reduction Act of 1995, effective October 404.1571–404.1576, 20 CFR 404.1584–
national emergency.
1, 1995. This notice includes revisions 404.1593, and 20 CFR 416.971–
Respondents: All 18-year-old males who
are United States citizens and those male of OMB-approved information 416.976—0960–0034. Social Security
immigrants residing in the United States at collections. disability recipients receive payments
the time of their 18th birthday are required SSA is soliciting comments on the based on their inability to engage in
to register with the Selective Service System. accuracy of the agency’s burden substantial gainful activity (SGA)
Frequency: Registration with the Selective estimate; the need for the information; because of a physical or mental
Service System is a one-time occurrence. its practical utility; ways to enhance its condition. If the recipients work, SSA
Burden: A burden of two minutes or less quality, utility, and clarity; and ways to
on the individual respondent.
must evaluate and determine if they
minimize burden on respondents, continue to meet the disability
Change: Collecting email addresses from including the use of automated
respondents. requirements of the law. Therefore, we
collection techniques or other forms of use Form SSA–L725 to request monthly
Copies of the above identified form information technology. Mail, email, or earnings information from the
can be obtained upon written request to fax your comments and recipient’s employer. We then use the
the Selective Service System, recommendations on the information earnings data to determine whether the
Operations Directorate, 1515 Wilson collection(s) to the OMB Desk Officer recipient is engaging in SGA, since work
Boulevard, Arlington, Virginia 22209– and SSA Reports Clearance Officer at after a recipient becomes entitled to
2425. the following addresses or fax numbers.
Written comments and benefits can cause a cessation of
recommendations for the proposed (OMB) disability. The respondents are
extension of clearance with change of Office of Management and Budget, Attn: businesses that employ Social Security
the form should be sent within 60 days Desk Officer for SSA, Fax: 202–395– disability recipients.
of the publication of this notice to the 6974, Email address: OIRA_ Type of Request: Revision of an OMB-
Selective Service System, Operations Submission@omb.eop.gov. approved information collection.
Average Estimated total
Number of Frequency of burden per
Modality of completion annual burden
respondents response response (hours)
(minutes)
SSA–L725 ........................................................................................................ 150,000 1 40 100,000
2. Supplemental Security Income pensions, disability benefits, veteran’s Form SSA–L8050–U3 to verify and
sradovich on DSK3GMQ082PROD with NOTICES
(SSI) Claim Information Notice—20 compensation, etc.) for which they are establish a claimant’s or recipient’s
CFR, Subpart B, 416.210—0960–0324. eligible before qualifying for SSI eligibility under the SSI program.
Section 1611(e)(2) of the Social Security payments. Individuals do not qualify for Respondents are SSI applicants or
Act requires individuals to file for and SSI if they do not first apply for all other recipients who may be eligible for other
obtain all payments (annuities, benefits. SSA uses the information on
10 17 CFR 200.30–3(a)(12).
VerDate Sep<11>2014 18:13 Dec 04, 2017 Jkt 244001 PO 00000 Frm 00098 Fmt 4703 Sfmt 4703 E:\FR\FM\05DEN1.SGM 05DEN1](https://thefederalregister.org/doc/82_FR_57750/page/3.svg)
Document Created: 2017-12-04 23:44:34
Document Modified: 2017-12-04 23:44:34
| 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 57518 |
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR