82 FR 9757 - Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d-2; Notice of Filing and Order Approving and Declaring Effective an Amendment to the Plan for the Allocation of Regulatory Responsibilities Among NYSE MKT LLC, Bats BZX Exchange, Inc., BOX Options Exchange LLC, C2 Options Exchange, Incorporated, the Chicago Board Options Exchange, Incorporated, Bats EDGX Exchange, Inc., the International Securities Exchange LLC, ISE Gemini, LLC, ISE Mercury, LLC, Financial Industry Regulatory Authority, Inc., NYSE Arca, Inc., The NASDAQ Stock Market LLC, NASDAQ BX, Inc., the NASDAQ PHLX, Inc., Miami International Securities Exchange, LLC, and MIAX PEARL, LLC Concerning Options-Related Sales Practice Matters
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 25 (February 8, 2017)
Federal Register Volume 82, Issue 25 (February 8, 2017)
| Page Range | 9757-9765 | |
| FR Document | 2017-02547 |
[Federal Register Volume 82, Number 25 (Wednesday, February 8, 2017)] [Notices] [Pages 9757-9765] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-02547] ======================================================================= ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-79929; File No. S7-966] Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d-2; Notice of Filing and Order Approving and Declaring Effective an Amendment to the Plan for the Allocation of Regulatory Responsibilities Among NYSE MKT LLC, Bats BZX Exchange, Inc., BOX Options Exchange LLC, C2 Options Exchange, Incorporated, the Chicago Board Options Exchange, Incorporated, Bats EDGX Exchange, Inc., the International Securities Exchange LLC, ISE Gemini, LLC, ISE Mercury, LLC, Financial Industry Regulatory Authority, Inc., NYSE Arca, Inc., The NASDAQ Stock Market LLC, NASDAQ BX, Inc., the NASDAQ PHLX, Inc., Miami International Securities Exchange, LLC, and MIAX PEARL, LLC Concerning Options-Related Sales Practice Matters February 2, 2017. Notice is hereby given that the Securities and Exchange Commission (``Commission'') has issued an Order, pursuant to Section 17(d) of the Securities Exchange Act of 1934 (``Act''),\1\ approving and declaring effective an amendment to the plan for allocating regulatory responsibility (``Plan'') filed on January 13, 2017, pursuant to Rule 17d-2 of the Act,\2\ by NYSE MKT LLC (``MKT''), Bats BZX Exchange, Inc., (``Bats''), the BOX Options Exchange LLC (``BOX''), C2 Options Exchange, Incorporated (``C2''), the Chicago Board Options Exchange, Incorporated (``CBOE''), Bats EDGX Exchange, Inc. (``EDGX''), the International Securities Exchange LLC (``ISE''), ISE Gemini, LLC (``Gemini''), ISE Mercury, LLC (``ISE Mercury''), Financial Industry Regulatory Authority, Inc. (``FINRA''), NYSE Arca, Inc. (``Arca''), The NASDAQ Stock Market LLC (``Nasdaq''), NASDAQ BX, Inc. (``BX''), NASDAQ PHLX, Inc. (``PHLX''), Miami International Securities Exchange (``MIAX''), and MIAX PEARL, LLC (``MIAX PEARL'') (collectively, ``Participating Organizations'' or ``parties''). --------------------------------------------------------------------------- \1\ 15 U.S.C. 78q(d). \2\ 17 CFR 240.17d-2. --------------------------------------------------------------------------- I. Introduction Section 19(g)(1) of the Act,\3\ among other things, requires every self-regulatory organization (``SRO'') registered as either a national securities exchange or national securities association to examine for, and enforce compliance by, its members and persons associated with its members with the Act, the rules and regulations thereunder, and the SRO's own rules, unless the SRO is relieved of this responsibility pursuant to Section 17(d) \4\ or Section 19(g)(2) \5\ of the Act. Without this relief, the statutory obligation of each individual SRO could result in a pattern of multiple examinations of broker-dealers that maintain memberships in more than one SRO (``common members''). Such regulatory duplication would add unnecessary expenses for common members and their SROs. --------------------------------------------------------------------------- \3\ 15 U.S.C. 78s(g)(1). \4\ 15 U.S.C. 78q(d). \5\ 15 U.S.C. 78s(g)(2). --------------------------------------------------------------------------- Section 17(d)(1) of the Act \6\ was intended, in part, to eliminate unnecessary multiple examinations and regulatory duplication.\7\ With respect to a common member, Section 17(d)(1) authorizes the Commission, by rule or order, to relieve an SRO of the responsibility to receive regulatory reports, to examine for and enforce compliance with applicable statutes, rules, and regulations, or to perform other specified regulatory functions. --------------------------------------------------------------------------- \6\ 15 U.S.C. 78q(d)(1). \7\ See Securities Act Amendments of 1975, Report of the Senate Committee on Banking, Housing, and Urban Affairs to Accompany S. 249, S. Rep. No. 94-75, 94th Cong., 1st Session 32 (1975). --------------------------------------------------------------------------- To implement Section 17(d)(1), the Commission adopted two rules: Rule 17d-1 and Rule 17d-2 under the Act.\8\ Rule 17d-1 authorizes the Commission to name a single SRO as the designated examining authority (``DEA'') to examine common members for compliance with the financial responsibility requirements imposed by the Act, or by Commission or SRO rules.\9\ When an SRO has been named as a common member's DEA, all other SROs to which the common member belongs are relieved of the responsibility to examine the firm for compliance with the applicable financial responsibility rules. On its face, Rule 17d-1 deals only [[Page 9758]] with an SRO's obligations to enforce member compliance with financial responsibility requirements. Rule 17d-1 does not relieve an SRO from its obligation to examine a common member for compliance with its own rules and provisions of the federal securities laws governing matters other than financial responsibility, including sales practices and trading activities and practices. --------------------------------------------------------------------------- \8\ 17 CFR 240.17d-1 and 17 CFR 240.17d-2, respectively. \9\ See Securities Exchange Act Release No. 12352 (April 20, 1976), 41 FR 18808 (May 7, 1976). --------------------------------------------------------------------------- To address regulatory duplication in these and other areas, the Commission adopted Rule 17d-2 under the Act.\10\ Rule 17d-2 permits SROs to propose joint plans for the allocation of regulatory responsibilities with respect to their common members. Under paragraph (c) of Rule 17d-2, the Commission may declare such a plan effective if, after providing for notice and comment, it determines that the plan is necessary or appropriate in the public interest and for the protection of investors, to foster cooperation and coordination among the SROs, to remove impediments to, and foster the development of, a national market system and a national clearance and settlement system, and is in conformity with the factors set forth in Section 17(d) of the Act. Commission approval of a plan filed pursuant to Rule 17d-2 relieves an SRO of those regulatory responsibilities allocated by the plan to another SRO. --------------------------------------------------------------------------- \10\ See Securities Exchange Act Release No. 12935 (October 28, 1976), 41 FR 49091 (November 8, 1976). --------------------------------------------------------------------------- II. The Plan On September 8, 1983, the Commission approved the SRO participants' plan for allocating regulatory responsibilities pursuant to Rule 17d- 2.\11\ On May 23, 2000, the Commission approved an amendment to the plan that added the ISE as a participant.\12\ On November 8, 2002, the Commission approved another amendment that replaced the original plan in its entirety and, among other things, allocated regulatory responsibilities among all the participants in a more equitable manner.\13\ On February 5, 2004, the Commission approved an amendment to the plan, primarily to include the BSE, which was establishing a new options trading facility to be known as BOX, as an SRO participant.\14\ On March 26, 2007, the Commission approved an amendment to the plan that, among other things, provided that the National Association of Securities Dealers (``NASD'') (n/k/a FINRA) and NYSE are Designated Options Examining Authorities under the plan.\15\ On March 12, 2008, the Commission approved an amendment to the plan primarily to add NASDAQ as an SRO participant.\16\ On June 18, 2008, the Commission approved an amendment to the plan primarily to remove the NYSE as a Designated Options Examining Authority, leaving FINRA as the sole Designated Options Examining Authority for all common members that are members of FINRA.\17\ On February 25, 2010, the Commission approved a proposed amendment to the plan to add Bats and C2 as SRO participants and to reflect the name changes of the American Stock Exchange LLC to the NYSE Amex LLC, the Boston Stock Exchange, Inc., to the NASDAQ OMX BX, Inc. and the Philadelphia Stock Exchange, Inc. to the NASDAQ OMX PHLX, Inc.\18\ On May 11, 2012, the Commission approved an amendment to the plan to add BOX as an SRO participant and to amend Section XIII of the plan to set forth a revised procedure for adding new participants to the plan.\19\ On December 5, 2012, the Commission approved an amendment to the plan to add MIAX as an SRO participant, and to change the name of NYSE Amex LLC to NYSE MKT LLC.\20\ On July 26, 2013, the Commission approved an amendment to the plan to add Topaz Exchange LLC as an SRO participant.\21\ On October 29, 2015, the Commission approved an amendment to the plan to add EDGX as an SRO participant and to change the name of Topaz Exchange, LLC to ISE Gemini, LLC.\22\ On February 16, 2016, the Commission approved an amendment to the plan to add ISE Mercury, and remove the NYSE, as an SRO participant to the Plan.\23\ --------------------------------------------------------------------------- \11\ See Securities Exchange Act Release No. 20158 (September 8, 1983), 48 FR 41256 (September 14, 1983). \12\ See Securities Exchange Act Release No. 42816 (May 23, 2000), 65 FR 34759 (May 31, 2000). \13\ See Securities Exchange Act Release No. 46800 (November 8, 2002), 67 FR 69774 (November 19, 2002). \14\ See Securities Exchange Act Release No. 49197 (February 5, 2004), 69 FR 7046 (February 12, 2004). \15\ See Securities Exchange Act Release No. 55532 (March 26, 2007), 72 FR 15729 (April 2, 2007). \16\ See Securities Exchange Act Release No. 57481 (March 12, 2008), 73 FR 14507 (March 18, 2008). \17\ See Securities Exchange Act Release No. 57987 (June 18, 2008), 73 FR 36156 (June 25, 2008). \18\ See Securities Exchange Act Release No. 61589 (February 25, 2012), 75 FR 9976 (March 4, 2010). \19\ See Securities Exchange Act Release No. 66974 (May 11, 2012), 77 FR 29705 (May 18, 2012). \20\ See Securities Exchange Act Release No. 68363 (December 5, 2012), 77 FR 73711 (December 11, 2012). \21\ See Securities Exchange Act Release No. 70051 (July 26, 2013), 78 FR 46644 (August 1, 2013). \22\ See Securities Exchange Act Release No. 76309 (October 29, 2015), 80 FR 68361 (November 4, 2015). \23\ See Securities Exchange Act Release No. 77148 (February 16, 2016), 81 FR 8775 (February 22, 2016). --------------------------------------------------------------------------- The plan reduces regulatory duplication for a large number of firms currently members of two or more of the SRO participants by allocating regulatory responsibility for certain options-related sales practice matters to one of the SRO participants. Generally, under the plan, the SRO participant responsible for conducting options-related sales practice examinations of a firm, and investigating options-related customer complaints and terminations for cause of associated persons of that firm, is known as the firm's ``Designated Options Examining Authority'' (``DOEA''). Pursuant to the plan, any other SRO of which the firm is a member is relieved of these responsibilities during the period in which the firm is assigned to another SRO acting as that firm's DOEA. III. Proposed Amendment to the Plan On January 13, 2017, the Parties submitted a proposed amendment to the Plan. The primary purpose of the amendment is to add MIAX PEARL as a participant to the Plan. The text of the proposed amended 17d-2 plan is as follows (additions are italicized; deletions are [bracketed]): * * * * * Agreement by and among [BATS]Bats BZX Exchange, Inc., BOX Options Exchange, LLC, the Chicago Board Options Exchange, Incorporated, C2 Options Exchange, Incorporated, the International Securities Exchange, LLC, Financial Industry Regulatory Authority, Inc., Miami International Securities Exchange, LLC, the NYSE MKT LLC, the NYSE Arca, Inc., The NASDAQ Stock Market LLC, NASDAQ [OMX] BX, Inc., the NASDAQ [OMX] PHLX LLC, ISE Gemini, LLC, Bats EDGX Exchange, Inc., [and] ISE Mercury, LLC and MIAX PEARL, LLC, Pursuant to Rule 17d-2 under the Securities Exchange Act of 1934. This agreement (``Agreement''), by and among [BATS]Bats BZX Exchange, Inc., BOX Options Exchange, LLC, the Chicago Board Options Exchange, Incorporated, C2 Options Exchange, Incorporated, the International Securities Exchange, LLC, Financial Industry Regulatory Authority, Inc. (``FINRA''), Miami International Securities Exchange, LLC, The NASDAQ Stock Market LLC (``NASDAQ''), NASDAQ [OMX] BX, Inc., the NYSE MKT LLC, the NYSE Arca, Inc., the NASDAQ [OMX] PHLX [[Page 9759]] LLC, ISE Gemini, LLC, Bats EDGX Exchange, Inc., [and] ISE Mercury, LLC and MIAX PEARL, LLC, hereinafter collectively referred to as the Participants, is made this [2nd]13th day of [February]January, 201[6]7, pursuant to the provisions of Rule 17d-2 under the Securities Exchange Act of 1934 (the ``Exchange Act''), which allows for plans among self- regulatory organizations to allocate regulatory responsibility. This Agreement shall be administered by a committee known as the Options Self-Regulatory Council (the ``Council''). This Agreement amends and restates the agreement entered into among the Participants on [October 8, 2015] February 3, 2016, entitled ``Agreement by and among BATS Exchange, Inc., BOX Options Exchange, LLC, the Chicago Board Options Exchange, Incorporated, C2 Options Exchange, Incorporated, the International Securities Exchange, LLC, Financial Industry Regulatory Authority, Inc., Miami International Securities Exchange, LLC, the New York Stock Exchange LLC, NYSE MKT LLC, the NYSE Arca, Inc., the NASDAQ Stock Market LLC, NASDAQ OMX BX, Inc., the NASDAQ OMX PHLX, Inc., ISE Gemini, LLC, [and] EDGX Exchange, Inc. and ISE Mercury, LLC, Pursuant to Rule 17d-2 under the Securities Exchange Act of 1934.'' Whereas, the Participants are desirous of allocating regulatory responsibilities with respect to broker-dealers, and persons associated therewith, that are members \1\ of more than one Participant (the ``Common Members'') and conduct a public business for compliance with Common Rules (as hereinafter defined) relating to the conduct by broker-dealers of accounts for listed options, index warrants, currency index warrants and currency warrants (collectively, ``Covered Securities''); and --------------------------------------------------------------------------- \1\ In the case of BOX Options Exchange, LLC (``BOX''), NASDAQ OMX BX, Inc. (``BX'') and NASDAQ members are those persons who are options participants (as defined in the BOX, BX and NASDAQ Options Market Rules). --------------------------------------------------------------------------- Whereas, the Participants are desirous of executing a plan for this purpose pursuant to the provisions of Rule 17d-2 and filing such plan with the Securities and Exchange Commission (``SEC'' or the ``Commission'') for its approval; Now, therefore, in consideration of the mutual covenants contained hereafter, the Participants agree as follows: I. As used herein the term Designated Options Examining Authority (``DOEA'') shall mean: (1) FINRA insofar as it shall perform Regulatory Responsibility (as hereinafter defined) for its broker-dealer members that also are members of another Participant or (2) the Designated Examination Authority (``DEA'') pursuant to SEC Rule 17d-1 under the Securities Exchange Act (``Rule 17d-1'') for a broker-dealer that is a member of a more than one Participant (but not a member of FINRA). II. As used herein, the term ``Regulatory Responsibility'' shall mean the examination and enforcement responsibilities relating to compliance by Common Members with the rules of the applicable Participant that are substantially similar to the rules of the other Participants (the ``Common Rules''), insofar as they apply to the conduct of accounts for Covered Securities. A list of the current Common Rules of each Participant applicable to the conduct of accounts for Covered Securities is attached hereto as Exhibit A. Each year within 30 days of the anniversary date of the commencement of operation of this Agreement, each Participant shall submit in writing to FINRA and each DEA performing as a DOEA for any members of such Participant any revisions to Exhibit A reflecting changes in the rules of the Participant, and confirm that all other rules of the Participant listed in Exhibit A continue to meet the definition of Common Rules as defined in this Agreement. Within 30 days from the date that FINRA and each DEA performing as a DOEA has received revisions and/or confirmation that no change has been made to Exhibit A from all Participants, FINRA and each DEA performing as a DOEA shall confirm in writing to each Participant whether the rules listed in any updated Exhibit A are Common Rules as defined in this Agreement. Notwithstanding anything herein to the contrary, it is explicitly understood that the term ``Regulatory Responsibility'' does not include, and each of the Participants shall (unless allocated pursuant to Rule 17d-2 otherwise than under this Agreement) retain full responsibility for, each of the following: (a) Surveillance and enforcement with respect to trading activities or practices involving its own marketplace, including without limitation its rules relating to the rights and obligations of specialists and other market makers; (b) Registration pursuant to its applicable rules of associated persons; (c) Discharge of its duties and obligations as a DEA; and (d) Evaluation of advertising, responsibility for which shall remain with the Participant to which a Common Member submits same for approval. III. Apparent violations of another Participant's rules discovered by a DOEA, but which rules are not within the scope of the discovering DOEA's Regulatory Responsibility, shall be referred to the relevant Participant for such action as the Participant to which such matter has been referred deems appropriate. Notwithstanding the foregoing, nothing contained herein shall preclude a DOEA in its discretion from requesting that another Participant conduct an enforcement proceeding on a matter for which the requesting DOEA has Regulatory Responsibility. If such other Participants agree, the Regulatory Responsibility in such case shall be deemed transferred to the accepting Participant and confirmed in writing by the Participants involved. Each Participant agrees, upon request, to make available promptly all relevant files, records and/or witnesses necessary to assist another Participant in an investigation or enforcement proceeding. IV. The Council shall be composed of one representative designated by each of the Participants. Each Participant shall also designate one or more persons as its alternate representative(s). In the absence of the representative of a Participant, such alternate representative shall have the same powers, duties and responsibilities as the representative. Each Participant may, at any time, by notice to the then Chair of the Council, replace its representative and/or its alternate representative on such Council. A majority of the Council shall constitute a quorum and, unless specifically otherwise required, the affirmative vote of a majority of the Council members present (in person, by telephone or by written consent) shall be necessary to constitute action by the Council. The representative from FINRA shall serve as Chair of the Council. All notices and other communications for the Council shall be sent to it in care of the Chair or to each of the representatives. V. The Council shall determine the times and locations of Council meetings, provided that the Chair, acting alone, may also call a meeting of the Council in the event the Chair determines that there is good cause to do so. To the extent reasonably possible, notice of any meeting shall be given at least ten-business days prior thereto. Notwithstanding anything herein to the contrary, representatives shall always be given the option of participating in any meeting telephonically at their own expense rather than in person. VI. FINRA shall have Regulatory Responsibility for all Common Members that are members of FINRA. For the [[Page 9760]] purpose of fulfilling the Participants' Regulatory Responsibilities for Common Members that are not members of FINRA, the Participant that is the DEA shall serve as the DOEA. All Participants shall promptly notify the DOEAs no later than the next scheduled meeting of any change in membership of Common Members. A DOEA may request that a Common Member that is allocated to it be reallocated to another DOEA by giving thirty days written notice thereof. The DOEAs in their discretion may approve such request and reallocate such Common Member to another DOEA. VII. Each DOEA shall conduct an examination of each Common Member. The Participants agree that, upon request, relevant information in their respective files relative to a Common Member will be made available to the applicable DOEA. At each meeting of the Council, each DOEA shall be prepared to report on the status of its examination program for the previous quarter and any period prior thereto that has not previously been reported to the Council. VIII. Each DOEA will promptly furnish a copy of the Examination report, relating to Covered Securities, of any examination made pursuant to the provisions of this Agreement to each other Participant of which the Common Member examined is a member. IX. Each DOEA's Regulatory Responsibility shall for each Common Member allocated to it include investigations into terminations ``for cause'' of associated persons relating to Covered Securities, unless such termination is related solely to another Participant's market. In the latter instance, that Participant to whose market the termination for cause relates shall discharge Regulatory Responsibility with respect to such termination for cause. In connection with a DOEA's examination, investigation and/or enforcement proceeding regarding a Covered Security-related termination for cause, the other Participants of which the Common Member is a member shall furnish, upon request, copies of all pertinent materials related thereto in their possession. As used in this Section, ``for cause'' shall include, without limitation, terminations characterized on Form U5 under the label ``Permitted to Resign,'' ``Discharge'' or ``Other.'' X. Each DOEA shall discharge the Regulatory Responsibility for each Common Member allocated to it relative to a Covered Securities-related customer complaint \2\ unless such complaint is uniquely related to another Participant's market. In the latter instance, the DOEA shall forward the matter to that Participant to whose market the matter relates, and the latter shall discharge Regulatory Responsibility with respect thereto. If a Participant receives a customer complaint for a Common Member related to a Covered Security for which the Participant is not the DOEA, the Participant shall promptly forward a copy of such complaint to the DOEA. --------------------------------------------------------------------------- \2\ For purposes of complaints, they can be reported pursuant to Form U4, Form U5 or RE-3 and any amendments thereto. --------------------------------------------------------------------------- XI. Any written notice required or permitted to be given under this Agreement shall be deemed given if sent by certified mail, return receipt requested, or by a comparable means of electronic communication to each Participant entitled to receipt thereof, to the attention of the Participant's representative on the Council at the Participant's then principal office or by email at such address as the representative shall have filed in writing with the Chair. XII. The Participants shall notify the Common Members of this Agreement by means of a uniform joint notice approved by the Council. XIII. This Agreement may be amended to add a new Participant provided that such Participant does not assume Regulatory Responsibility, solely by an amendment by FINRA and such new Participant. All other Participants expressly consent to allow FINRA to add new Participants to this Agreement as provided above. FINRA will promptly notify all Participants of any such amendments to add new Participants. All other amendments to this Agreement must be approved in writing by each Participant. All amendments, including adding a new Participant, must be filed with and approved by the SEC before they become effective. XIV. Any of the Participants may manifest its intention to cancel its participation in this Agreement at any time by giving the Council written notice thereof at least 90 days prior to the effective date of such cancellation. Upon receipt of such notice the Council shall allocate, in accordance with the provisions of this Agreement, any Common Members for which the petitioning party was the DOEA. Until such time as the Council has completed the reallocation described above; the petitioning Participant shall retain all its rights, privileges, duties and obligations hereunder. XV. The cancellation of its participation in this Agreement by any Participant shall not terminate this Agreement as to the remaining Participants. This Agreement will only terminate following notice to the Commission, in writing, by the then Participants that they intend to terminate the Agreement and the expiration of the applicable notice period. Such notice shall be given at least six months prior to the intended date of termination, provided that in the event a notice of cancellation is received from a Participant that, assuming the effectiveness thereof, would result in there being just one remaining member of the Council, notice to the Commission of termination of this Agreement shall be given promptly upon the receipt of such notice of cancellation, which termination shall be effective upon the effectiveness of the cancellation that triggered the notice of termination to the Commission. XVI. No Participant nor the Council nor any of their respective directors, governors, officers, employees or representatives shall be liable to any other Participant in this Agreement for any liability, loss or damage resulting from or claimed to have resulted from any delays, inaccuracies, errors or omissions with respect to the provision of Regulatory Responsibility as provided hereby or for the failure to provide any such Responsibility, except with respect to such liability, loss or damages as shall have been suffered by one or more of the Participants and caused by the willful misconduct of one or more of the other participants or their respective directors, governors, officers, employees or representatives. No warranties, express or implied, are made by any or all of the Participants or the Council with respect to any Regulatory Responsibility to be performed by each of them hereunder. XVII. Pursuant to Section 17(d)(1)(A) of the Securities Exchange Act of 1934 and Rule 17d-2 promulgated pursuant thereto, the Participants join in requesting the Securities and Exchange Commission, upon its approval of this Agreement or any part thereof, to relieve those Participants which are from time to time participants in this Agreement which are not the DOEA as to a Common Member of any and all Regulatory Responsibility with respect to the matters allocated to the DOEA. * * * * * [[Page 9761]] [February 2, 2016]January 13, 2017 Exhibit A Rules Enforced Under 17d-2 Agreement Pursuant to Section II of the Agreement by and among [BATS]Bats BZX Exchange, Inc. (``[BATS]BZX''), BOX Options Exchange, LLC (``BOX''), the Chicago Board Options Exchange, Incorporated (``CBOE''), C2 Options Exchange, Incorporated (``C2''), the International Securities Exchange, LLC (``ISE''), Financial Industry Regulatory Authority, Inc. (``FINRA''), Miami International Securities Exchange, LLC (``MIAX''), The NASDAQ Stock Market LLC (``NASDAQ''), NASDAQ [OMX] BX, Inc. (``BX''), the NYSE MKT LLC (``NYSE MKT''), the NYSE Arca, Inc. (``NYSE ARCA''), the NASDAQ [OMX] PHLX LLC (``PHLX''), ISE Gemini, LLC (``ISE Gemini''), [and] Bats EDGX Exchange, Inc. (``EDGX''), [and] ISE Mercury, LLC (``ISE Mercury'') and MIAX PEARL (``MIAX PEARL'') pursuant to Rule 17d-2 under the Securities Exchange Act of 1934 dated [February 2, 2016] January 13, 2017 (the ``Agreement''), a revised list of the current Common Rules of each Participant, as compared to those of FINRA, applicable to the conduct of accounts for Covered Securities is set forth in this Exhibit A. ------------------------------------------------------------------------ ------------------------------------------------------------------------ Opening of Accounts ------------------------------------------------------------------------ NYSE MKT..................... Rules 411, 921 and 1101. [BATS]BZX.................... Rule 26.2. BOX.......................... Rule 4020. CBOE......................... Rule 9.7. C2 *......................... CBOE Rule 9.7. EDGX......................... Rule 26.2. ISE.......................... Rule 608. FINRA........................ Rules 2360(b)(16) and 2352. MIAX......................... Rule 1307. MIAX PEARL................... Rule 1307. ISE Gemini................... Rule 608. ISE Mercury.................. Rule 608. PHLX......................... Rule 1024(b) and (c).\1\ NYSE ARCA.................... Options Rules 9.2(a) and 9.18(b) and Equities Rules 9.18(b) and 8.4. BX........................... Chapter XI, Section 7. NASDAQ....................... Chapter XI, Section 7. ------------------------------------------------------------------------ Supervision ------------------------------------------------------------------------ NYSE MKT..................... Rules 411, 922 and 1104. [BATS]BZX.................... Rule 26.3. BOX.......................... Rule 4030. CBOE......................... Rule 9.8. \2\ C2........................... CBOE Rule 9.8. \2\ EDGX......................... Rule 26.3. ISE.......................... Rule 609. FINRA........................ Rules 2360(b)(20), 2360(b)(17)(B), 2360(b)(16)(E), 2355 and 2358. MIAX......................... Rule1308. MIAX PEARL................... Rule 1308. ISE Gemini................... Rule 609. ISE Mercury.................. Rule 609. PHLX......................... Rule 1025. NYSE ARCA.................... Options Rules 9.2(b) and 9.18(d)(2)(G) and Equities Rule[s 9.18(d)(2)(G) and] 8.7. BX........................... Chapter XI, Section 8. NASDAQ....................... Chapter XI, Section 8. ------------------------------------------------------------------------ Suitability ------------------------------------------------------------------------ NYSE MKT..................... Rules 923 and 1102. [BATS]BZX.................... Rule 26.4. BOX.......................... Rule 4040. CBOE......................... Rule 9.9. C2........................... CBOE Rule 9.9. EDGX......................... Rule 26.4. ISE.......................... Rule 610. FINRA........................ Rule 2360(b)(19) and 2353. MIAX......................... Rule 1309. MIAX PEARL................... Rule 1309. ISE Gemini................... Rule 610. ISE Mercury.................. Rule 610. PHLX......................... Rule 1026. NYSE ARCA.................... Options Rule 9.18(c) and Equities Rules 9.18(c) and 8.5. BX........................... Chapter XI, Section 9. NASDAQ....................... Chapter XI, Section 9. ------------------------------------------------------------------------ Discretionary Accounts ------------------------------------------------------------------------ NYSE MKT..................... Rules 421, 924 and 1103. [BATS]BZX.................... Rule 26.5. \3\ BOX.......................... Rule 4050. [[Page 9762]] CBOE......................... Rule 9.10. C2........................... CBOE Rule 9.10. EDGX......................... Rule 26.5. \3\ ISE.......................... Rule 611. FINRA........................ Rules 2360(b)(18) and 2354. MIAX......................... Rule 1310. MIAX PEARL................... Rule 1310. ISE Gemini................... Rule 611. ISE Mercury.................. Rule 611. PHLX......................... Rule 1027. NYSE ARCA.................... Options Rule 9.18(e) and Equities Rules 9.18(e) and 8.6. BX........................... Chapter XI, Section 10. NASDAQ....................... Chapter XI, Section 10. ------------------------------------------------------------------------ Customer Communications (Advertising) ------------------------------------------------------------------------ NYSE MKT..................... Rules 991 and 1106. [BATS]BZX.................... Rule 26.16. BOX.......................... Rule 4170. CBOE......................... Rule 9.21. C2........................... CBOE Rule 9.21. EDGX......................... Rule 26.16. ISE.......................... Rule 623. FINRA........................ Rules 2220 and 2357. MIAX......................... Rule 1322. MIAX PEARL................... Rule 1322. ISE Gemini................... Rule 623. ISE Mercury.................. Rule 623. PHLX......................... N/A. NYSE ARCA.................... Options Rules 9.21(a) and 9.21(b). BX........................... Chapter XI, Section 22. NASDAQ....................... Chapter XI, Section 22. ------------------------------------------------------------------------ Customer Complaints ------------------------------------------------------------------------ NYSE MKT..................... Rules 932 and 1105. [BATS]BZX.................... Rule 26.17. BOX.......................... Rule 4190. CBOE......................... Rule 9.23. C2........................... CBOE Rule 9.23. EDGX......................... Rule 26.17. ISE.......................... Rule 625. FINRA........................ FINRA Rules 2360(b)(17)(A) and 2356. MIAX......................... Rule 1324. MIAX PEARL................... Rule 1324. ISE Gemini................... Rule 625. ISE Mercury.................. Rule 625. PHLX......................... Rule 1028. NYSE ARCA.................... Options Rule 9.18(I) and Equities Rules 9.18(l) and 8.8. BX........................... Chapter XI, Section 24. NASDAQ....................... Chapter XI, Section 24. ------------------------------------------------------------------------ Customer Statements ------------------------------------------------------------------------ NYSE MKT..................... Rules 419 and 930. [BATS]BZX.................... Rule 26.7. BOX.......................... Rule 4070. CBOE......................... Rule 9.12. C2........................... CBOE Rule 9.12. EDGX......................... Rule 26.7. ISE.......................... Rules 613. FINRA........................ Rule 2360(b)(15). MIAX......................... Rule 1312. MIAX PEARL................... Rule 1312. ISE Gemini................... Rule 613. ISE Mercury.................. Rule 613. PHLX......................... Rule 1032. NYSE ARCA.................... Options Rule 9.18(j) and Equities Rule 9.18(j). BX........................... Chapter XI, Sections 12. NASDAQ....................... Chapter XI, Section 12. ------------------------------------------------------------------------ Confirmations ------------------------------------------------------------------------ NYSE MKT..................... Rule 925. [BATS]BZX.................... Rule 26.6. BOX.......................... Rule 4060. CBOE......................... Rule 9.11. [[Page 9763]] C2........................... CBOE Rule 9.11. EDGX......................... Rule 26.6. ISE.......................... Rule 612. FINRA........................ Rule 2360(b)(12). MIAX......................... Rule 1311. MIAX PEARL................... Rule 1311. ISE Gemini................... Rule 612. ISE Mercury.................. Rule 612. PHLX......................... Rule 1028. NYSE ARCA.................... Options Rule 9.18(f) and Equities Rule 9.18([j]f). BX........................... Chapter XI, Section 11. NASDAQ....................... Chapter XI, Section 11. ------------------------------------------------------------------------ Allocation of Exercise Assignment Notices ------------------------------------------------------------------------ NYSE MKT..................... Rule 981. [BATS]BZX.................... Rule 23.2. BOX.......................... Rule 9010. CBOE......................... Rule 11.2. C2........................... CBOE Rule 11.2. EDGX......................... Rule 23.2. ISE.......................... Rule 1101. FINRA........................ Rule 2360(b)(23)(C). MIAX......................... Rule 701. MIAX PEARL................... Rule 701. ISE Gemini................... Rule 1101. ISE Mercury.................. Rule 1101. PHLX......................... Rule 1043. NYSE ARCA.................... Options Rule 6.25(a). BX........................... Chapter VIII, Section 2. NASDAQ....................... Chapter VIII, Section 2. ------------------------------------------------------------------------ Disclosure Documents ------------------------------------------------------------------------ NYSE MKT..................... Rules 921 and 926. [BATS]BZX.................... Rule 26.10. BOX.......................... Rule 4100. CBOE......................... Rule 9.15. C2........................... CBOE Rule 9.15. EDGX......................... Rule 26.10. ISE.......................... Rule 616. FINRA........................ Rule 2360(b)(11). MIAX......................... Rule 1315. MIAX PEARL................... Rule 1315. ISE Gemini................... Rule 616. ISE Mercury.................. Rule 616. PHLX......................... Rule 1024(b)(v), 1029. NYSE ARCA.................... Options Rule 9.18(g) and Equities Rule 9.18(g). BX........................... Chapter XI, Section 15. NASDAQ....................... Chapter XI, Section 15. ------------------------------------------------------------------------ Branch Offices of Member Organizations ------------------------------------------------------------------------ NYSE MKT..................... Rule 922(d). \4\ BOX.......................... Rule 4010(b). CBOE......................... Rule 9.6. C2........................... CBOE Rule 9.6. ISE.......................... Rule 607. FINRA........................ Rules 2360(b)(20)(B) and 2355. MIAX......................... Rule 1306. MIAX PEARL................... Rule 1306. ISE Gemini................... Rule 607. ISE Mercury.................. Rule 607. PHLX......................... N/A. NYSE ARCA.................... Options Rule 9.18(m) and Equities Rule 9.18(m). BX........................... Chapter XI, Section 6. NASDAQ....................... Chapter XI, Section 6. ------------------------------------------------------------------------ Prohibition Against Guarantees ------------------------------------------------------------------------ NYSE MKT..................... Rule 390. [BATS]BZX.................... Rule 26.13. BOX.......................... Rule 4130. CBOE......................... Rule 9.18. C2........................... CBOE Rule 9.18. EDGX......................... Rule 26.13. ISE.......................... Rules 619. [[Page 9764]] FINRA........................ Rule 2150(b). MIAX......................... Rule 1318. MIAX PEARL................... Rule 1318. ISE Gemini................... Rule 619. ISE Mercury.................. Rule 619. PHLX......................... Rule 777. NYSE ARCA.................... Options Rule 9.1(e) and Equities Rule 9.1(e). BX........................... Chapter XI, Sections 18 and 19. NASDAQ....................... Chapter XI, Sections 18 and 19. ------------------------------------------------------------------------ Sharing in Accounts ------------------------------------------------------------------------ NYSE MKT..................... Rule 390. [BATS]BZX.................... Rule 26.14. \6\ BOX.......................... Rule 4140. CBOE......................... Rule 9.18(b). C2........................... CBOE Rule 9.18(b). EDGX......................... Rule 26.14, \6\ ISE.......................... Rule 620. \5\ FINRA........................ Rule 2150(c). MIAX......................... Rule 1319. MIAX PEARL................... Rule 1319. ISE Gemini................... Rule 620. \5\ ISE Mercury.................. Rule 620. \5\ PHLX......................... N/A. NYSE ARCA.................... Options Rule 9.1(f). BX........................... Chapter XI, Section 19. \6\ NASDAQ....................... Chapter XI, Section 19. \6\ ------------------------------------------------------------------------ Registration of ROP ------------------------------------------------------------------------ NYSE MKT..................... Rule 920. [BATS]BZX.................... Rule 17.2(g)(1), (2), (6) and (7). BOX.......................... Rule 2020(c)(1), (e)(1) and IM-2040-4 and IM-2040-5(b). CBOE......................... Rule 9.2. C2........................... CBOE Rule 9.2. EDGX......................... Rule 17.2(g)(1), (2), (6) and (7). ISE.......................... Rule 601. FINRA........................ NASD Rules 1022(f), IM-1022-1, & 1250(a)(1). MIAX......................... Rule 1301. MIAX PEARL................... Rule 1301. ISE Gemini................... Rule 601. ISE Mercury.................. Rule 601. PHLX......................... Rule 1024(a)(i). NYSE ARCA.................... Options Rule 9.26 and Equities Rule 9.26. BX........................... Chapter XI, Section 2 and Chapter II, Section 2(g). NASDAQ....................... Chapter XI, Section 2 and Chapter II, Section 2(g). ------------------------------------------------------------------------ Certification of Registered Personnel ------------------------------------------------------------------------ NYSE MKT..................... Rule 920. [BATS]BZX.................... Rule 2.5 Interpretation .01(c) and 11.4(e). BOX.......................... IM-2040-3. CBOE......................... Rule 9.3. C2........................... CBOE Rule 9.3. EDGX......................... Rule 2.5 Interpretation .01(c) and 11.4(e). ISE.......................... Rule 602. FINRA........................ NASD Rule 1032(d). MIAX......................... Rule 1302. MIAX PEARL................... Rule 1302. ISE Gemini................... Rule 602. ISE Mercury.................. Rule 602. PHLX......................... Rule 1024. NYSE ARCA.................... Options Rule 9.27(a) and Equities Rule 9.27(a). BX........................... Chapter XI, Section 3 and Chapter II, Section 2(h). NASDAQ....................... Chapter XI, Section 3 and Chapter II, Section 2(h). ------------------------------------------------------------------------ \1\ FINRA shall not have any Regulatory Responsibility regarding foreign currency option requirements specified in any of the PHLX rules in this Exhibit A. \2\ FINRA shall not have any Regulatory Responsibility regarding receipt of written reports by April 1 of each year pursuant to CBOE Rule 9.8(g). \3\ FINRA shall not have any Regulatory Responsibility to enforce this rule as to time and price discretion in institutional accounts. \4\ FINRA shall only have Regulatory Responsibility for the first paragraph and shall not have any Regulatory Responsibility regarding the requirements for debt options. \5\ FINRA shall not have any Regulatory Responsibility regarding ISE's, ISE Gemini's and ISE Mercury's requirements to the extent its rule does not contain an exception to permit sharing in the profits and losses of an account. \6\ FINRA shall not have any Regulatory Responsibility regarding NASDAQ's, BX's, [BATS]BZX's, and EDGX's requirements to the extent such rules do not contain an exception addressing immediate family. [[Page 9765]] IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing. 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 S7-966 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 S7-966. 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 plan that are filed with the Commission, and all written communications relating to the proposed plan 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 plan also will be available for inspection and copying at the principal offices of FINRA and MIAX PEARL. 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 S7-966 and should be submitted on or before March 1, 2017. V. Discussion The Commission continues to believe that the proposed plan is an achievement in cooperation among the SRO participants. The Plan, as amended, will reduce unnecessary regulatory duplication by allocating to the designated SRO the responsibility for certain options-related sales practice matters that would otherwise be performed by multiple SROs. The plan promotes efficiency by reducing costs to firms that are members of more than one of the SRO participants. In addition, because the SRO participants coordinate their regulatory functions in accordance with the plan, the plan promotes, and will continue to promote, investor protection. Under paragraph (c) of Rule 17d-2, the Commission may, after appropriate notice and comment, declare a plan, or any part of a plan, effective. In this instance, the Commission believes that appropriate notice and comment can take place after the proposed amendment is effective. The primary purpose of the amendment is to add MIAX PEARL as a participant to the Plan. By declaring it effective today, the amended Plan can become effective and be implemented without undue delay.\24\ The Commission notes that the prior version of this plan immediately prior to this proposed amendment was published for comment and the Commission did not receive any comments thereon.\25\ Furthermore, the Commission does not believe that the amendment to the plan raises any new regulatory issues that the Commission has not previously considered. --------------------------------------------------------------------------- \24\ On December 13, 2016, the Commission approved MIAX PEARL's application for registration as a national securities exchange. See Securities Exchange Act Release No. 79543, 81 FR 92901 (December 20, 2016). \25\ See Securities Exchange Act Release No. 77148 (February 16, 2016), 81 FR 8775 (February 22, 2016). --------------------------------------------------------------------------- VI. Conclusion This order gives effect to the amended Plan submitted to the Commission that is contained in File No. S7-966. It is therefore ordered, pursuant to Section 17(d) of the Act, that the Plan, as amended, filed with the Commission pursuant to Rule 17d-2 on January 13, 2017, is hereby approved and declared effective. It is further ordered that those SRO participants that are not the DOEA as to a particular common member are relieved of those regulatory responsibilities allocated to the common member's DOEA under the amended Plan to the extent of such allocation. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\26\ --------------------------------------------------------------------------- \26\ 17 CFR 200.30-3(a)(34). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2017-02547 Filed 2-7-17; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 82, No. 25 / Wednesday, February 8, 2017 / Notices 9757
available in ADAMS under Accession Dated at Rockville, Maryland, this 1st day Securities Exchange (‘‘MIAX’’), and
No. ML17031A153. of February, 2017. MIAX PEARL, LLC (‘‘MIAX PEARL’’)
For the U.S. Nuclear Regulatory
• NRC’s PDR: You may examine and (collectively, ‘‘Participating
Commission.
purchase copies of public documents at Organizations’’ or ‘‘parties’’).
Daniel S. Collins,
the NRC’s PDR, Room O1–F21, One I. Introduction
White Flint North, 11555 Rockville Director, Division of Material Safety, State,
Tribal and Rulemaking Programs, Office of Section 19(g)(1) of the Act,3 among
Pike, Rockville, Maryland 20852. Nuclear Material Safety and Safeguards.
other things, requires every self-
B. Submitting Comments [FR Doc. 2017–02574 Filed 2–7–17; 8:45 am] regulatory organization (‘‘SRO’’)
BILLING CODE 7590–01–P registered as either a national securities
Please include Docket ID NRC–2016–
0227 in the subject line of your exchange or national securities
comment submission, in order to ensure association to examine for, and enforce
that the NRC is able to make your SECURITIES AND EXCHANGE compliance by, its members and persons
comment submission available to the COMMISSION associated with its members with the
public in this docket. [Release No. 34–79929; File No. S7–966] Act, the rules and regulations
The NRC cautions you not to include thereunder, and the SRO’s own rules,
identifying or contact information that Program for Allocation of Regulatory unless the SRO is relieved of this
you do not want publicly disclosed in Responsibilities Pursuant to Rule 17d– responsibility pursuant to Section
your comment submission. The NRC 2; Notice of Filing and Order 17(d) 4 or Section 19(g)(2) 5 of the Act.
will post all comment submissions at Approving and Declaring Effective an Without this relief, the statutory
http://www.regulations.gov as well as Amendment to the Plan for the obligation of each individual SRO could
enter the comment submissions into Allocation of Regulatory result in a pattern of multiple
ADAMS, and the NRC does not Responsibilities Among NYSE MKT examinations of broker-dealers that
routinely edit comment submissions to LLC, Bats BZX Exchange, Inc., BOX maintain memberships in more than one
remove identifying or contact Options Exchange LLC, C2 Options SRO (‘‘common members’’). Such
information. Exchange, Incorporated, the Chicago regulatory duplication would add
If you are requesting or aggregating Board Options Exchange, unnecessary expenses for common
comments from other persons for Incorporated, Bats EDGX Exchange, members and their SROs.
submission to the NRC, then you should Inc., the International Securities Section 17(d)(1) of the Act 6 was
inform those persons not to include Exchange LLC, ISE Gemini, LLC, ISE intended, in part, to eliminate
identifying or contact information that Mercury, LLC, Financial Industry unnecessary multiple examinations and
they do not want to be publicly Regulatory Authority, Inc., NYSE Arca, regulatory duplication.7 With respect to
disclosed in their comment submission. Inc., The NASDAQ Stock Market LLC, a common member, Section 17(d)(1)
Your request should state that the NRC NASDAQ BX, Inc., the NASDAQ PHLX, authorizes the Commission, by rule or
Inc., Miami International Securities order, to relieve an SRO of the
does not routinely edit comment
Exchange, LLC, and MIAX PEARL, LLC responsibility to receive regulatory
submissions to remove such information
Concerning Options-Related Sales reports, to examine for and enforce
before making the comment
Practice Matters compliance with applicable statutes,
submissions available to the public or
entering the comment submissions into February 2, 2017.
rules, and regulations, or to perform
ADAMS. other specified regulatory functions.
Notice is hereby given that the
To implement Section 17(d)(1), the
II. Further Information Securities and Exchange Commission
Commission adopted two rules: Rule
(‘‘Commission’’) has issued an Order,
This NUREG provides guidance to 17d–1 and Rule 17d–2 under the Act.8
pursuant to Section 17(d) of the
existing licensees initially distributing Securities Exchange Act of 1934 Rule 17d–1 authorizes the Commission
byproduct material or source material to (‘‘Act’’),1 approving and declaring to name a single SRO as the designated
persons exempt from the requirements examining authority (‘‘DEA’’) to
effective an amendment to the plan for
(exempt distribution) for an NRC license examine common members for
allocating regulatory responsibility
under 10 CFR 30.14, 10 CFR 30.15, 10 compliance with the financial
(‘‘Plan’’) filed on January 13, 2017,
CFR 30.18, 10 CFR 30.19, 10 CFR 30.20, responsibility requirements imposed by
pursuant to Rule 17d–2 of the Act,2 by
10 CFR 30.21, 10 CFR 30.22, and 10 CFR the Act, or by Commission or SRO
NYSE MKT LLC (‘‘MKT’’), Bats BZX
40.13(c) and exempt from licensing rules.9 When an SRO has been named as
Exchange, Inc., (‘‘Bats’’), the BOX
requirements under the equivalent Options Exchange LLC (‘‘BOX’’), C2 a common member’s DEA, all other
provisions in Agreement State Options Exchange, Incorporated (‘‘C2’’), SROs to which the common member
regulations. This NUREG also provides the Chicago Board Options Exchange, belongs are relieved of the responsibility
guidance to applicants preparing a Incorporated (‘‘CBOE’’), Bats EDGX to examine the firm for compliance with
license application to distribute such Exchange, Inc. (‘‘EDGX’’), the the applicable financial responsibility
materials. Additionally, this NUREG International Securities Exchange LLC rules. On its face, Rule 17d–1 deals only
provides NRC reviewers with criteria for (‘‘ISE’’), ISE Gemini, LLC (‘‘Gemini’’), 3 15 U.S.C. 78s(g)(1).
evaluating such a license application. ISE Mercury, LLC (‘‘ISE Mercury’’), 4 15 U.S.C. 78q(d).
The purpose of this notice is to provide
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Financial Industry Regulatory 5 15 U.S.C. 78s(g)(2).
the public an opportunity to review and Authority, Inc. (‘‘FINRA’’), NYSE Arca, 6 15 U.S.C. 78q(d)(1).
comment on draft NUREG–1556, Inc. (‘‘Arca’’), The NASDAQ Stock 7 See Securities Act Amendments of 1975, Report
Volume 8, Revision 1, ‘‘Consolidated Market LLC (‘‘Nasdaq’’), NASDAQ BX, of the Senate Committee on Banking, Housing, and
Guidance About Materials Licenses: Urban Affairs to Accompany S. 249, S. Rep. No. 94–
Inc. (‘‘BX’’), NASDAQ PHLX, Inc. 75, 94th Cong., 1st Session 32 (1975).
Program-Specific Guidance About (‘‘PHLX’’), Miami International 8 17 CFR 240.17d–1 and 17 CFR 240.17d–2,
Exempt Distribution Licenses.’’ These respectively.
comments will be considered in the 1 15 U.S.C. 78q(d). 9 See Securities Exchange Act Release No. 12352
final version or subsequent revisions. 2 17 CFR 240.17d–2. (April 20, 1976), 41 FR 18808 (May 7, 1976).
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![9758 Federal Register / Vol. 82, No. 25 / Wednesday, February 8, 2017 / Notices
with an SRO’s obligations to enforce an SRO participant.14 On March 26, remove the NYSE, as an SRO participant
member compliance with financial 2007, the Commission approved an to the Plan.23
responsibility requirements. Rule 17d–1 amendment to the plan that, among The plan reduces regulatory
does not relieve an SRO from its other things, provided that the National duplication for a large number of firms
obligation to examine a common Association of Securities Dealers currently members of two or more of the
member for compliance with its own (‘‘NASD’’) (n/k/a FINRA) and NYSE are SRO participants by allocating
rules and provisions of the federal Designated Options Examining regulatory responsibility for certain
securities laws governing matters other Authorities under the plan.15 On March options-related sales practice matters to
than financial responsibility, including 12, 2008, the Commission approved an one of the SRO participants. Generally,
sales practices and trading activities and amendment to the plan primarily to add under the plan, the SRO participant
practices. NASDAQ as an SRO participant.16 On responsible for conducting options-
June 18, 2008, the Commission related sales practice examinations of a
To address regulatory duplication in firm, and investigating options-related
these and other areas, the Commission approved an amendment to the plan
primarily to remove the NYSE as a customer complaints and terminations
adopted Rule 17d–2 under the Act.10 for cause of associated persons of that
Rule 17d–2 permits SROs to propose Designated Options Examining
Authority, leaving FINRA as the sole firm, is known as the firm’s ‘‘Designated
joint plans for the allocation of Options Examining Authority’’
regulatory responsibilities with respect Designated Options Examining
Authority for all common members that (‘‘DOEA’’). Pursuant to the plan, any
to their common members. Under other SRO of which the firm is a
paragraph (c) of Rule 17d–2, the are members of FINRA.17 On February
25, 2010, the Commission approved a member is relieved of these
Commission may declare such a plan responsibilities during the period in
effective if, after providing for notice proposed amendment to the plan to add
Bats and C2 as SRO participants and to which the firm is assigned to another
and comment, it determines that the SRO acting as that firm’s DOEA.
plan is necessary or appropriate in the reflect the name changes of the
public interest and for the protection of American Stock Exchange LLC to the III. Proposed Amendment to the Plan
investors, to foster cooperation and NYSE Amex LLC, the Boston Stock On January 13, 2017, the Parties
coordination among the SROs, to Exchange, Inc., to the NASDAQ OMX submitted a proposed amendment to the
remove impediments to, and foster the BX, Inc. and the Philadelphia Stock Plan. The primary purpose of the
development of, a national market Exchange, Inc. to the NASDAQ OMX amendment is to add MIAX PEARL as
system and a national clearance and PHLX, Inc.18 On May 11, 2012, the a participant to the Plan. The text of the
settlement system, and is in conformity Commission approved an amendment to proposed amended 17d–2 plan is as
with the factors set forth in Section the plan to add BOX as an SRO follows (additions are italicized;
17(d) of the Act. Commission approval participant and to amend Section XIII of deletions are [bracketed]):
of a plan filed pursuant to Rule 17d–2 the plan to set forth a revised procedure
* * * * *
relieves an SRO of those regulatory for adding new participants to the Agreement by and among [BATS]Bats
responsibilities allocated by the plan to plan.19 On December 5, 2012, the BZX Exchange, Inc., BOX Options
another SRO. Commission approved an amendment to Exchange, LLC, the Chicago Board
the plan to add MIAX as an SRO Options Exchange, Incorporated, C2
II. The Plan participant, and to change the name of Options Exchange, Incorporated, the
NYSE Amex LLC to NYSE MKT LLC.20 International Securities Exchange, LLC,
On September 8, 1983, the On July 26, 2013, the Commission
Commission approved the SRO Financial Industry Regulatory
approved an amendment to the plan to Authority, Inc., Miami International
participants’ plan for allocating add Topaz Exchange LLC as an SRO
regulatory responsibilities pursuant to Securities Exchange, LLC, the NYSE
participant.21 On October 29, 2015, the MKT LLC, the NYSE Arca, Inc., The
Rule 17d–2.11 On May 23, 2000, the Commission approved an amendment to
Commission approved an amendment to NASDAQ Stock Market LLC, NASDAQ
the plan to add EDGX as an SRO [OMX] BX, Inc., the NASDAQ [OMX]
the plan that added the ISE as a participant and to change the name of
participant.12 On November 8, 2002, the PHLX LLC, ISE Gemini, LLC, Bats EDGX
Topaz Exchange, LLC to ISE Gemini, Exchange, Inc., [and] ISE Mercury, LLC
Commission approved another LLC.22 On February 16, 2016, the
amendment that replaced the original and MIAX PEARL, LLC, Pursuant to
Commission approved an amendment to Rule 17d–2 under the Securities
plan in its entirety and, among other the plan to add ISE Mercury, and
things, allocated regulatory Exchange Act of 1934.
responsibilities among all the 14 See Securities Exchange Act Release No. 49197
This agreement (‘‘Agreement’’), by
participants in a more equitable (February 5, 2004), 69 FR 7046 (February 12, 2004). and among [BATS]Bats BZX Exchange,
manner.13 On February 5, 2004, the 15 See Securities Exchange Act Release No. 55532 Inc., BOX Options Exchange, LLC, the
Commission approved an amendment to (March 26, 2007), 72 FR 15729 (April 2, 2007). Chicago Board Options Exchange,
the plan, primarily to include the BSE, 16 See Securities Exchange Act Release No. 57481
Incorporated, C2 Options Exchange,
(March 12, 2008), 73 FR 14507 (March 18, 2008). Incorporated, the International
which was establishing a new options 17 See Securities Exchange Act Release No. 57987
trading facility to be known as BOX, as (June 18, 2008), 73 FR 36156 (June 25, 2008).
Securities Exchange, LLC, Financial
18 See Securities Exchange Act Release No. 61589 Industry Regulatory Authority, Inc.
10 See Securities Exchange Act Release No. 12935 (February 25, 2012), 75 FR 9976 (March 4, 2010). (‘‘FINRA’’), Miami International
asabaliauskas on DSK3SPTVN1PROD with NOTICES
(October 28, 1976), 41 FR 49091 (November 8, 19 See Securities Exchange Act Release No. 66974 Securities Exchange, LLC, The
1976). (May 11, 2012), 77 FR 29705 (May 18, 2012). NASDAQ Stock Market LLC
11 See Securities Exchange Act Release No. 20158 20 See Securities Exchange Act Release No. 68363
(‘‘NASDAQ’’), NASDAQ [OMX] BX,
(September 8, 1983), 48 FR 41256 (September 14, (December 5, 2012), 77 FR 73711 (December 11,
1983). 2012). Inc., the NYSE MKT LLC, the NYSE
12 See Securities Exchange Act Release No. 42816 21 See Securities Exchange Act Release No. 70051 Arca, Inc., the NASDAQ [OMX] PHLX
(May 23, 2000), 65 FR 34759 (May 31, 2000). (July 26, 2013), 78 FR 46644 (August 1, 2013).
13 See Securities Exchange Act Release No. 46800 22 See Securities Exchange Act Release No. 76309 23 See Securities Exchange Act Release No. 77148
(November 8, 2002), 67 FR 69774 (November 19, (October 29, 2015), 80 FR 68361 (November 4, (February 16, 2016), 81 FR 8775 (February 22,
2002). 2015). 2016).
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![Federal Register / Vol. 82, No. 25 / Wednesday, February 8, 2017 / Notices 9759
LLC, ISE Gemini, LLC, Bats EDGX hereinafter defined) for its broker-dealer III. Apparent violations of another
Exchange, Inc., [and] ISE Mercury, LLC members that also are members of Participant’s rules discovered by a
and MIAX PEARL, LLC, hereinafter another Participant or (2) the Designated DOEA, but which rules are not within
collectively referred to as the Examination Authority (‘‘DEA’’) the scope of the discovering DOEA’s
Participants, is made this [2nd]13th day pursuant to SEC Rule 17d–1 under the Regulatory Responsibility, shall be
of [February]January, 201[6]7, pursuant Securities Exchange Act (‘‘Rule 17d–1’’) referred to the relevant Participant for
to the provisions of Rule 17d–2 under for a broker-dealer that is a member of such action as the Participant to which
the Securities Exchange Act of 1934 (the a more than one Participant (but not a such matter has been referred deems
‘‘Exchange Act’’), which allows for member of FINRA). appropriate. Notwithstanding the
plans among self-regulatory II. As used herein, the term foregoing, nothing contained herein
organizations to allocate regulatory ‘‘Regulatory Responsibility’’ shall mean shall preclude a DOEA in its discretion
responsibility. This Agreement shall be the examination and enforcement from requesting that another Participant
administered by a committee known as responsibilities relating to compliance conduct an enforcement proceeding on
the Options Self-Regulatory Council (the by Common Members with the rules of a matter for which the requesting DOEA
‘‘Council’’). the applicable Participant that are has Regulatory Responsibility. If such
This Agreement amends and restates substantially similar to the rules of the other Participants agree, the Regulatory
the agreement entered into among the other Participants (the ‘‘Common Responsibility in such case shall be
Participants on [October 8, 2015] Rules’’), insofar as they apply to the deemed transferred to the accepting
February 3, 2016, entitled ‘‘Agreement conduct of accounts for Covered Participant and confirmed in writing by
by and among BATS Exchange, Inc., Securities. A list of the current Common the Participants involved. Each
BOX Options Exchange, LLC, the Rules of each Participant applicable to Participant agrees, upon request, to
Chicago Board Options Exchange, the conduct of accounts for Covered make available promptly all relevant
Incorporated, C2 Options Exchange, Securities is attached hereto as files, records and/or witnesses necessary
Incorporated, the International Exhibit A. Each year within 30 days of to assist another Participant in an
Securities Exchange, LLC, Financial the anniversary date of the investigation or enforcement
Industry Regulatory Authority, Inc., commencement of operation of this proceeding.
Miami International Securities Agreement, each Participant shall IV. The Council shall be composed of
Exchange, LLC, the New York Stock submit in writing to FINRA and each one representative designated by each of
Exchange LLC, NYSE MKT LLC, the DEA performing as a DOEA for any the Participants. Each Participant shall
NYSE Arca, Inc., the NASDAQ Stock members of such Participant any also designate one or more persons as its
Market LLC, NASDAQ OMX BX, Inc., revisions to Exhibit A reflecting changes alternate representative(s). In the
the NASDAQ OMX PHLX, Inc., ISE in the rules of the Participant, and absence of the representative of a
Gemini, LLC, [and] EDGX Exchange, confirm that all other rules of the Participant, such alternate
Inc. and ISE Mercury, LLC, Pursuant to Participant listed in Exhibit A continue representative shall have the same
Rule 17d–2 under the Securities to meet the definition of Common Rules powers, duties and responsibilities as
Exchange Act of 1934.’’ as defined in this Agreement. Within 30 the representative. Each Participant
Whereas, the Participants are desirous days from the date that FINRA and each may, at any time, by notice to the then
of allocating regulatory responsibilities DEA performing as a DOEA has received Chair of the Council, replace its
with respect to broker-dealers, and revisions and/or confirmation that no representative and/or its alternate
persons associated therewith, that are change has been made to Exhibit A from representative on such Council. A
members 1 of more than one Participant all Participants, FINRA and each DEA majority of the Council shall constitute
(the ‘‘Common Members’’) and conduct performing as a DOEA shall confirm in a quorum and, unless specifically
a public business for compliance with writing to each Participant whether the otherwise required, the affirmative vote
Common Rules (as hereinafter defined) rules listed in any updated Exhibit A are of a majority of the Council members
relating to the conduct by broker-dealers Common Rules as defined in this present (in person, by telephone or by
of accounts for listed options, index Agreement. Notwithstanding anything written consent) shall be necessary to
warrants, currency index warrants and herein to the contrary, it is explicitly constitute action by the Council. The
currency warrants (collectively, understood that the term ‘‘Regulatory representative from FINRA shall serve
‘‘Covered Securities’’); and Responsibility’’ does not include, and as Chair of the Council. All notices and
Whereas, the Participants are desirous each of the Participants shall (unless other communications for the Council
of executing a plan for this purpose allocated pursuant to Rule 17d–2 shall be sent to it in care of the Chair
pursuant to the provisions of Rule 17d– otherwise than under this Agreement) or to each of the representatives.
2 and filing such plan with the retain full responsibility for, each of the V. The Council shall determine the
Securities and Exchange Commission following: times and locations of Council meetings,
(‘‘SEC’’ or the ‘‘Commission’’) for its (a) Surveillance and enforcement with provided that the Chair, acting alone,
approval; respect to trading activities or practices may also call a meeting of the Council
Now, therefore, in consideration of involving its own marketplace, in the event the Chair determines that
the mutual covenants contained including without limitation its rules there is good cause to do so. To the
hereafter, the Participants agree as relating to the rights and obligations of extent reasonably possible, notice of any
follows: specialists and other market makers; meeting shall be given at least ten-
I. As used herein the term Designated business days prior thereto.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
(b) Registration pursuant to its
Options Examining Authority (‘‘DOEA’’) applicable rules of associated persons; Notwithstanding anything herein to the
shall mean: (1) FINRA insofar as it shall (c) Discharge of its duties and contrary, representatives shall always be
perform Regulatory Responsibility (as obligations as a DEA; and given the option of participating in any
(d) Evaluation of advertising, meeting telephonically at their own
1 In the case of BOX Options Exchange, LLC
responsibility for which shall remain expense rather than in person.
(‘‘BOX’’), NASDAQ OMX BX, Inc. (‘‘BX’’) and
NASDAQ members are those persons who are
with the Participant to which a VI. FINRA shall have Regulatory
options participants (as defined in the BOX, BX and Common Member submits same for Responsibility for all Common Members
NASDAQ Options Market Rules). approval. that are members of FINRA. For the
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[February 2, 2016]January 13, 2017 International Securities Exchange, LLC Mercury, LLC (‘‘ISE Mercury’’) and
(‘‘ISE’’), Financial Industry Regulatory MIAX PEARL (‘‘MIAX PEARL’’)
Exhibit A
Authority, Inc. (‘‘FINRA’’), Miami pursuant to Rule 17d–2 under the
Rules Enforced Under 17d–2 Agreement International Securities Exchange, LLC Securities Exchange Act of 1934 dated
(‘‘MIAX’’), The NASDAQ Stock Market [February 2, 2016] January 13, 2017 (the
Pursuant to Section II of the LLC (‘‘NASDAQ’’), NASDAQ [OMX] ‘‘Agreement’’), a revised list of the
Agreement by and among [BATS]Bats BX, Inc. (‘‘BX’’), the NYSE MKT LLC current Common Rules of each
BZX Exchange, Inc. (‘‘[BATS]BZX’’), (‘‘NYSE MKT’’), the NYSE Arca, Inc. Participant, as compared to those of
BOX Options Exchange, LLC (‘‘BOX’’), (‘‘NYSE ARCA’’), the NASDAQ [OMX] FINRA, applicable to the conduct of
the Chicago Board Options Exchange, PHLX LLC (‘‘PHLX’’), ISE Gemini, LLC accounts for Covered Securities is set
Incorporated (‘‘CBOE’’), C2 Options (‘‘ISE Gemini’’), [and] Bats EDGX forth in this Exhibit A.
Exchange, Incorporated (‘‘C2’’), the Exchange, Inc. (‘‘EDGX’’), [and] ISE
Opening of Accounts
NYSE MKT ......................................................... Rules 411, 921 and 1101.
[BATS]BZX .......................................................... Rule 26.2.
BOX .................................................................... Rule 4020.
CBOE .................................................................. Rule 9.7.
C2 * ..................................................................... CBOE Rule 9.7.
EDGX .................................................................. Rule 26.2.
ISE ...................................................................... Rule 608.
FINRA ................................................................. Rules 2360(b)(16) and 2352.
MIAX ................................................................... Rule 1307.
MIAX PEARL ...................................................... Rule 1307.
ISE Gemini .......................................................... Rule 608.
ISE Mercury ........................................................ Rule 608.
PHLX ................................................................... Rule 1024(b) and (c).1
NYSE ARCA ....................................................... Options Rules 9.2(a) and 9.18(b) and Equities Rules 9.18(b) and 8.4.
BX ....................................................................... Chapter XI, Section 7.
NASDAQ ............................................................. Chapter XI, Section 7.
Supervision
NYSE MKT ......................................................... Rules 411, 922 and 1104.
[BATS]BZX .......................................................... Rule 26.3.
BOX .................................................................... Rule 4030.
CBOE .................................................................. Rule 9.8. 2
C2 ....................................................................... CBOE Rule 9.8. 2
EDGX .................................................................. Rule 26.3.
ISE ...................................................................... Rule 609.
FINRA ................................................................. Rules 2360(b)(20), 2360(b)(17)(B), 2360(b)(16)(E), 2355 and 2358.
MIAX ................................................................... Rule1308.
MIAX PEARL ...................................................... Rule 1308.
ISE Gemini .......................................................... Rule 609.
ISE Mercury ........................................................ Rule 609.
PHLX ................................................................... Rule 1025.
NYSE ARCA ....................................................... Options Rules 9.2(b) and 9.18(d)(2)(G) and Equities Rule[s 9.18(d)(2)(G) and] 8.7.
BX ....................................................................... Chapter XI, Section 8.
NASDAQ ............................................................. Chapter XI, Section 8.
Suitability
NYSE MKT ......................................................... Rules 923 and 1102.
[BATS]BZX .......................................................... Rule 26.4.
BOX .................................................................... Rule 4040.
CBOE .................................................................. Rule 9.9.
C2 ....................................................................... CBOE Rule 9.9.
EDGX .................................................................. Rule 26.4.
ISE ...................................................................... Rule 610.
FINRA ................................................................. Rule 2360(b)(19) and 2353.
MIAX ................................................................... Rule 1309.
MIAX PEARL ...................................................... Rule 1309.
ISE Gemini .......................................................... Rule 610.
ISE Mercury ........................................................ Rule 610.
PHLX ................................................................... Rule 1026.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
NYSE ARCA ....................................................... Options Rule 9.18(c) and Equities Rules 9.18(c) and 8.5.
BX ....................................................................... Chapter XI, Section 9.
NASDAQ ............................................................. Chapter XI, Section 9.
Discretionary Accounts
NYSE MKT ......................................................... Rules 421, 924 and 1103.
[BATS]BZX .......................................................... Rule 26.5. 3
BOX .................................................................... Rule 4050.
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![9762 Federal Register / Vol. 82, No. 25 / Wednesday, February 8, 2017 / Notices
CBOE .................................................................. Rule 9.10.
C2 ....................................................................... CBOE Rule 9.10.
EDGX .................................................................. Rule 26.5. 3
ISE ...................................................................... Rule 611.
FINRA ................................................................. Rules 2360(b)(18) and 2354.
MIAX ................................................................... Rule 1310.
MIAX PEARL ...................................................... Rule 1310.
ISE Gemini .......................................................... Rule 611.
ISE Mercury ........................................................ Rule 611.
PHLX ................................................................... Rule 1027.
NYSE ARCA ....................................................... Options Rule 9.18(e) and Equities Rules 9.18(e) and 8.6.
BX ....................................................................... Chapter XI, Section 10.
NASDAQ ............................................................. Chapter XI, Section 10.
Customer Communications (Advertising)
NYSE MKT ......................................................... Rules 991 and 1106.
[BATS]BZX .......................................................... Rule 26.16.
BOX .................................................................... Rule 4170.
CBOE .................................................................. Rule 9.21.
C2 ....................................................................... CBOE Rule 9.21.
EDGX .................................................................. Rule 26.16.
ISE ...................................................................... Rule 623.
FINRA ................................................................. Rules 2220 and 2357.
MIAX ................................................................... Rule 1322.
MIAX PEARL ...................................................... Rule 1322.
ISE Gemini .......................................................... Rule 623.
ISE Mercury ........................................................ Rule 623.
PHLX ................................................................... N/A.
NYSE ARCA ....................................................... Options Rules 9.21(a) and 9.21(b).
BX ....................................................................... Chapter XI, Section 22.
NASDAQ ............................................................. Chapter XI, Section 22.
Customer Complaints
NYSE MKT ......................................................... Rules 932 and 1105.
[BATS]BZX .......................................................... Rule 26.17.
BOX .................................................................... Rule 4190.
CBOE .................................................................. Rule 9.23.
C2 ....................................................................... CBOE Rule 9.23.
EDGX .................................................................. Rule 26.17.
ISE ...................................................................... Rule 625.
FINRA ................................................................. FINRA Rules 2360(b)(17)(A) and 2356.
MIAX ................................................................... Rule 1324.
MIAX PEARL ...................................................... Rule 1324.
ISE Gemini .......................................................... Rule 625.
ISE Mercury ........................................................ Rule 625.
PHLX ................................................................... Rule 1028.
NYSE ARCA ....................................................... Options Rule 9.18(I) and Equities Rules 9.18(l) and 8.8.
BX ....................................................................... Chapter XI, Section 24.
NASDAQ ............................................................. Chapter XI, Section 24.
Customer Statements
NYSE MKT ......................................................... Rules 419 and 930.
[BATS]BZX .......................................................... Rule 26.7.
BOX .................................................................... Rule 4070.
CBOE .................................................................. Rule 9.12.
C2 ....................................................................... CBOE Rule 9.12.
EDGX .................................................................. Rule 26.7.
ISE ...................................................................... Rules 613.
FINRA ................................................................. Rule 2360(b)(15).
MIAX ................................................................... Rule 1312.
MIAX PEARL ...................................................... Rule 1312.
ISE Gemini .......................................................... Rule 613.
ISE Mercury ........................................................ Rule 613.
PHLX ................................................................... Rule 1032.
NYSE ARCA ....................................................... Options Rule 9.18(j) and Equities Rule 9.18(j).
asabaliauskas on DSK3SPTVN1PROD with NOTICES
BX ....................................................................... Chapter XI, Sections 12.
NASDAQ ............................................................. Chapter XI, Section 12.
Confirmations
NYSE MKT ......................................................... Rule 925.
[BATS]BZX .......................................................... Rule 26.6.
BOX .................................................................... Rule 4060.
CBOE .................................................................. Rule 9.11.
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![Federal Register / Vol. 82, No. 25 / Wednesday, February 8, 2017 / Notices 9763
C2 ....................................................................... CBOE Rule 9.11.
EDGX .................................................................. Rule 26.6.
ISE ...................................................................... Rule 612.
FINRA ................................................................. Rule 2360(b)(12).
MIAX ................................................................... Rule 1311.
MIAX PEARL ...................................................... Rule 1311.
ISE Gemini .......................................................... Rule 612.
ISE Mercury ........................................................ Rule 612.
PHLX ................................................................... Rule 1028.
NYSE ARCA ....................................................... Options Rule 9.18(f) and Equities Rule 9.18([j]f).
BX ....................................................................... Chapter XI, Section 11.
NASDAQ ............................................................. Chapter XI, Section 11.
Allocation of Exercise Assignment Notices
NYSE MKT ......................................................... Rule 981.
[BATS]BZX .......................................................... Rule 23.2.
BOX .................................................................... Rule 9010.
CBOE .................................................................. Rule 11.2.
C2 ....................................................................... CBOE Rule 11.2.
EDGX .................................................................. Rule 23.2.
ISE ...................................................................... Rule 1101.
FINRA ................................................................. Rule 2360(b)(23)(C).
MIAX ................................................................... Rule 701.
MIAX PEARL ...................................................... Rule 701.
ISE Gemini .......................................................... Rule 1101.
ISE Mercury ........................................................ Rule 1101.
PHLX ................................................................... Rule 1043.
NYSE ARCA ....................................................... Options Rule 6.25(a).
BX ....................................................................... Chapter VIII, Section 2.
NASDAQ ............................................................. Chapter VIII, Section 2.
Disclosure Documents
NYSE MKT ......................................................... Rules 921 and 926.
[BATS]BZX .......................................................... Rule 26.10.
BOX .................................................................... Rule 4100.
CBOE .................................................................. Rule 9.15.
C2 ....................................................................... CBOE Rule 9.15.
EDGX .................................................................. Rule 26.10.
ISE ...................................................................... Rule 616.
FINRA ................................................................. Rule 2360(b)(11).
MIAX ................................................................... Rule 1315.
MIAX PEARL ...................................................... Rule 1315.
ISE Gemini .......................................................... Rule 616.
ISE Mercury ........................................................ Rule 616.
PHLX ................................................................... Rule 1024(b)(v), 1029.
NYSE ARCA ....................................................... Options Rule 9.18(g) and Equities Rule 9.18(g).
BX ....................................................................... Chapter XI, Section 15.
NASDAQ ............................................................. Chapter XI, Section 15.
Branch Offices of Member Organizations
NYSE MKT ......................................................... Rule 922(d). 4
BOX .................................................................... Rule 4010(b).
CBOE .................................................................. Rule 9.6.
C2 ....................................................................... CBOE Rule 9.6.
ISE ...................................................................... Rule 607.
FINRA ................................................................. Rules 2360(b)(20)(B) and 2355.
MIAX ................................................................... Rule 1306.
MIAX PEARL ...................................................... Rule 1306.
ISE Gemini .......................................................... Rule 607.
ISE Mercury ........................................................ Rule 607.
PHLX ................................................................... N/A.
NYSE ARCA ....................................................... Options Rule 9.18(m) and Equities Rule 9.18(m).
BX ....................................................................... Chapter XI, Section 6.
NASDAQ ............................................................. Chapter XI, Section 6.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Prohibition Against Guarantees
NYSE MKT ......................................................... Rule 390.
[BATS]BZX .......................................................... Rule 26.13.
BOX .................................................................... Rule 4130.
CBOE .................................................................. Rule 9.18.
C2 ....................................................................... CBOE Rule 9.18.
EDGX .................................................................. Rule 26.13.
ISE ...................................................................... Rules 619.
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![9764 Federal Register / Vol. 82, No. 25 / Wednesday, February 8, 2017 / Notices
FINRA ................................................................. Rule 2150(b).
MIAX ................................................................... Rule 1318.
MIAX PEARL ...................................................... Rule 1318.
ISE Gemini .......................................................... Rule 619.
ISE Mercury ........................................................ Rule 619.
PHLX ................................................................... Rule 777.
NYSE ARCA ....................................................... Options Rule 9.1(e) and Equities Rule 9.1(e).
BX ....................................................................... Chapter XI, Sections 18 and 19.
NASDAQ ............................................................. Chapter XI, Sections 18 and 19.
Sharing in Accounts
NYSE MKT ......................................................... Rule 390.
[BATS]BZX .......................................................... Rule 26.14. 6
BOX .................................................................... Rule 4140.
CBOE .................................................................. Rule 9.18(b).
C2 ....................................................................... CBOE Rule 9.18(b).
EDGX .................................................................. Rule 26.14, 6
ISE ...................................................................... Rule 620. 5
FINRA ................................................................. Rule 2150(c).
MIAX ................................................................... Rule 1319.
MIAX PEARL ...................................................... Rule 1319.
ISE Gemini .......................................................... Rule 620. 5
ISE Mercury ........................................................ Rule 620. 5
PHLX ................................................................... N/A.
NYSE ARCA ....................................................... Options Rule 9.1(f).
BX ....................................................................... Chapter XI, Section 19. 6
NASDAQ ............................................................. Chapter XI, Section 19. 6
Registration of ROP
NYSE MKT ......................................................... Rule 920.
[BATS]BZX .......................................................... Rule 17.2(g)(1), (2), (6) and (7).
BOX .................................................................... Rule 2020(c)(1), (e)(1) and IM–2040–4 and IM–2040–5(b).
CBOE .................................................................. Rule 9.2.
C2 ....................................................................... CBOE Rule 9.2.
EDGX .................................................................. Rule 17.2(g)(1), (2), (6) and (7).
ISE ...................................................................... Rule 601.
FINRA ................................................................. NASD Rules 1022(f), IM–1022–1, & 1250(a)(1).
MIAX ................................................................... Rule 1301.
MIAX PEARL ...................................................... Rule 1301.
ISE Gemini .......................................................... Rule 601.
ISE Mercury ........................................................ Rule 601.
PHLX ................................................................... Rule 1024(a)(i).
NYSE ARCA ....................................................... Options Rule 9.26 and Equities Rule 9.26.
BX ....................................................................... Chapter XI, Section 2 and Chapter II, Section 2(g).
NASDAQ ............................................................. Chapter XI, Section 2 and Chapter II, Section 2(g).
Certification of Registered Personnel
NYSE MKT ......................................................... Rule 920.
[BATS]BZX .......................................................... Rule 2.5 Interpretation .01(c) and 11.4(e).
BOX .................................................................... IM–2040–3.
CBOE .................................................................. Rule 9.3.
C2 ....................................................................... CBOE Rule 9.3.
EDGX .................................................................. Rule 2.5 Interpretation .01(c) and 11.4(e).
ISE ...................................................................... Rule 602.
FINRA ................................................................. NASD Rule 1032(d).
MIAX ................................................................... Rule 1302.
MIAX PEARL ...................................................... Rule 1302.
ISE Gemini .......................................................... Rule 602.
ISE Mercury ........................................................ Rule 602.
PHLX ................................................................... Rule 1024.
NYSE ARCA ....................................................... Options Rule 9.27(a) and Equities Rule 9.27(a).
BX ....................................................................... Chapter XI, Section 3 and Chapter II, Section 2(h).
NASDAQ ............................................................. Chapter XI, Section 3 and Chapter II, Section 2(h).
1 FINRA shall not have any Regulatory Responsibility regarding foreign currency option requirements specified in any of the PHLX rules in this
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Exhibit A.
2 FINRA shall not have any Regulatory Responsibility regarding receipt of written reports by April 1 of each year pursuant to CBOE Rule
9.8(g).
3 FINRA shall not have any Regulatory Responsibility to enforce this rule as to time and price discretion in institutional accounts.
4 FINRA shall only have Regulatory Responsibility for the first paragraph and shall not have any Regulatory Responsibility regarding the re-
quirements for debt options.
5 FINRA shall not have any Regulatory Responsibility regarding ISE’s, ISE Gemini’s and ISE Mercury’s requirements to the extent its rule does
not contain an exception to permit sharing in the profits and losses of an account.
6 FINRA shall not have any Regulatory Responsibility regarding NASDAQ’s, BX’s, [BATS]BZX’s, and EDGX’s requirements to the extent such
rules do not contain an exception addressing immediate family.
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![Federal Register / Vol. 82, No. 25 / Wednesday, February 8, 2017 / Notices 9765
IV. Solicitation of Comments matters that would otherwise be SECURITIES AND EXCHANGE
Interested persons are invited to performed by multiple SROs. The plan COMMISSION
submit written data, views, and promotes efficiency by reducing costs to
[Release No. 34–79949; File No. SR–
arguments concerning the foregoing. firms that are members of more than one
BatsEDGX–2017–08]
Comments may be submitted by any of of the SRO participants. In addition,
the following methods: because the SRO participants coordinate Self-Regulatory Organizations; Bats
their regulatory functions in accordance EDGX Exchange, Inc.; Notice of Filing
Electronic Comments with the plan, the plan promotes, and of a Proposed Rule Change To Adopt
• Use the Commission’s Internet will continue to promote, investor Rules 4.5 Through 4.16 To Implement
comment form (http://www.sec.gov/ protection. the Compliance Rule Regarding the
rules/sro.shtml); or Under paragraph (c) of Rule 17d–2, National Market System Plan
• Send an email to rule-comments@ the Commission may, after appropriate Governing the Consolidated Audit Trail
sec.gov. Please include File Number S7– notice and comment, declare a plan, or
966 on the subject line. February 2, 2017.
any part of a plan, effective. In this
instance, the Commission believes that Pursuant to Section 19(b)(1) of the
Paper Comments Securities Exchange Act of 1934 (the
appropriate notice and comment can
• Send paper comments in triplicate take place after the proposed ‘‘Act’’),1 and Rule 19b–4 thereunder,2
to Secretary, Securities and Exchange amendment is effective. The primary notice is hereby given that on January
Commission, 100 F Street NE., purpose of the amendment is to add 30, 2017, Bats EDGX Exchange, Inc. (the
Washington, DC 20549–1090. MIAX PEARL as a participant to the ‘‘Exchange’’ or ‘‘EDGX’’) filed with the
All submissions should refer to File Plan. By declaring it effective today, the Securities and Exchange Commission
Number S7–966. This file number amended Plan can become effective and (‘‘Commission’’) the proposed rule
should be included on the subject line be implemented without undue delay.24 change as described in Items I, II and III
if email is used. To help the The Commission notes that the prior below, which Items have been prepared
Commission process and review your version of this plan immediately prior to by the Exchange.3 The Commission is
comments more efficiently, please use this proposed amendment was publishing this notice to solicit
only one method. The Commission will published for comment and the comments on the proposed rule change
post all comments on the Commission’s Commission did not receive any from interested persons.
Internet Web site (http://www.sec.gov/ comments thereon.25 Furthermore, the I. Self-Regulatory Organization’s
rules/sro.shtml). Copies of the Commission does not believe that the Statement of the Terms of Substance of
submission, all subsequent amendment to the plan raises any new the Proposed Rule Change
amendments, all written statements regulatory issues that the Commission
has not previously considered. The Exchange filed a proposal to
with respect to the proposed plan that
adopt Rules 4.5 through 4.16 to
are filed with the Commission, and all
VI. Conclusion implement the compliance rule
written communications relating to the
(‘‘Compliance Rule’’) regarding the
proposed plan between the Commission This order gives effect to the amended National Market System Plan Governing
and any person, other than those that Plan submitted to the Commission that the Consolidated Audit Trail (the ‘‘CAT
may be withheld from the public in is contained in File No. S7–966. NMS Plan’’ or ‘‘Plan’’).4
accordance with the provisions of 5 It is therefore ordered, pursuant to The text of the proposed rule change
U.S.C. 552, will be available for Web Section 17(d) of the Act, that the Plan, is available at the Exchange’s Web site
site viewing and printing in the as amended, filed with the Commission at www.bats.com, the principal office of
Commission’s Public Reference Room, pursuant to Rule 17d–2 on January 13, the Exchange, and at the Commission’s
100 F Street NE., Washington, DC 2017, is hereby approved and declared Public Reference Room.
20549, on official business days effective.
between the hours of 10:00 a.m. and II. Self-Regulatory Organization’s
3:00 p.m. Copies of the plan also will be It is further ordered that those SRO Statement of the Purpose of, and
available for inspection and copying at participants that are not the DOEA as to Statutory Basis for, the Proposed Rule
the principal offices of FINRA and a particular common member are Change
MIAX PEARL. All comments received relieved of those regulatory
responsibilities allocated to the common In its filing with the Commission, the
will be posted without change; the Exchange included statements
Commission does not edit personal member’s DOEA under the amended
Plan to the extent of such allocation. concerning the purpose of and basis for
identifying information from the proposed rule change and discussed
submissions. You should submit only For the Commission, by the Division of
any comments it received on the
information that you wish to make Trading and Markets, pursuant to delegated
authority.26 proposed rule change. The text of these
available publicly. All submissions statements may be examined at the
should refer to File Number S7–966 and Robert W. Errett,
places specified in Item IV below. The
should be submitted on or before March Deputy Secretary.
Exchange has prepared summaries, set
1, 2017. [FR Doc. 2017–02547 Filed 2–7–17; 8:45 am] forth in Sections A, B, and C below, of
BILLING CODE 8011–01–P
V. Discussion
asabaliauskas on DSK3SPTVN1PROD with NOTICES
1 15U.S.C. 78s(b)(1).
The Commission continues to believe 24 On December 13, 2016, the Commission 2 17CFR 240.19b–4.
that the proposed plan is an approved MIAX PEARL’s application for 3 The Exchange originally filed this proposed rule
achievement in cooperation among the registration as a national securities exchange. See change on January 17, 2017 under File No. SR–
SRO participants. The Plan, as Securities Exchange Act Release No. 79543, 81 FR BatsEDGX–2017–06, and the Exchange
92901 (December 20, 2016). subsequently withdrew that filing on January 30,
amended, will reduce unnecessary 25 See Securities Exchange Act Release No. 77148 2017 and filed this proposed rule change.
regulatory duplication by allocating to (February 16, 2016), 81 FR 8775 (February 22, 4 Unless otherwise specified, capitalized terms
the designated SRO the responsibility 2016). used in this rule filing are defined as set forth
for certain options-related sales practice 26 17 CFR 200.30–3(a)(34). herein or in the CAT NMS Plan.
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Document Created: 2017-02-08 02:59:14
Document Modified: 2017-02-08 02:59:14
| 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 9757 |
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