83 FR 31576 - Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 21.5, Minimum Increments, To Extend the Penny Pilot Program
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 130 (July 6, 2018)
Federal Register Volume 83, Issue 130 (July 6, 2018)
| Page Range | 31576-31577 | |
| FR Document | 2018-14466 |
[Federal Register Volume 83, Number 130 (Friday, July 6, 2018)] [Notices] [Pages 31576-31577] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-14466] [[Page 31576]] ======================================================================= ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-83566; File No. SR-CboeEDGX-2018-021] Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 21.5, Minimum Increments, To Extend the Penny Pilot Program June 29, 2018. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on June 26, 2018, Cboe EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange has designated this proposal as a ``non-controversial'' proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b- 4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ 15 U.S.C. 78s(b)(3)(A). \4\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal for the EDGX Options Market (``EDGX Options'') to extend through December 31, 2018, the Penny Pilot Program (``Penny Pilot'') in options classes in certain issues (``Pilot Program'') previously approved by the Commission.\5\ --------------------------------------------------------------------------- \5\ The rules of EDGX Options, including rules applicable to EDGX Options' participation in the Penny Pilot, were approved on August 7, 2015. See Securities Exchange Act Release No. 75650 (August 7, 2015), 80 FR 48600 (August 13, 2015) (SR-EDGX-2015 18). EDGX Options commenced operations on November 2, 2015. --------------------------------------------------------------------------- The text of the proposed rule change is available at the Exchange's website at www.markets.cboe.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to extend the Penny Pilot, which was previously approved by the Commission, through December 31, 2018, and to provide revised dates for adding replacement issues to the Pilot Program. The Exchange proposes that any Pilot Program issues that have been delisted may be replaced on the second trading day following July 1, 2018. The replacement issues will be selected based on trading activity for the most recent six month period excluding the month immediately preceding the replacement (i.e., beginning December 1, 2017, and ending May 31, 2018). The Exchange represents that the Exchange has the necessary system capacity to continue to support operation of the Penny Pilot. The Exchange believes the benefits to public customers and other market participants who will be able to express their true prices to buy and sell options have been demonstrated to outweigh the increase in quote traffic. 2. Statutory Basis The Exchange believes that its proposal is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6(b) of the Act.\6\ In particular, the proposal is consistent with Section 6(b)(5) of the Act \7\ because it would promote just and equitable principles of trade, remove impediments to, and perfect the mechanism of, a free and open market and a national market system. The Exchange believes that the Pilot Program promotes just and equitable principles of trade by enabling public customers and other market participants to express their true prices to buy and sell options. Accordingly, the Exchange believes that the proposal is consistent with the Act because it will allow the Exchange to extend the Pilot Program prior to its expiration on June 30, 2018. The Exchange notes that this proposal does not propose any new policies or provisions that are unique or unproven, but instead relates to the continuation of an existing program that operates on a pilot basis. --------------------------------------------------------------------------- \6\ 15 U.S.C. 78f(b). \7\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. In this regard, the Exchange notes that the rule change is being proposed in order to continue the Pilot Program, which is a competitive response to analogous programs offered by other options exchanges. The Exchange believes this proposed rule change is necessary to permit fair competition among the options exchanges. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any written comments from members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act \8\ and Rule 19b-4(f)(6) thereunder.\9\ Because the proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative prior to 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b- 4(f)(6)(iii) thereunder. --------------------------------------------------------------------------- \8\ 15 U.S.C. 78s(b)(3)(A)(iii). \9\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- A proposed rule change filed under Rule 19b-4(f)(6) \10\ normally does not become operative prior to 30 days after the date of the filing.\11\ However, [[Page 31577]] pursuant to Rule 19b-4(f)(6)(iii),\12\ the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because doing so will allow the Pilot Program to continue without interruption in a manner that is consistent with the Commission's prior approval of the extension and expansion of the Pilot Program and will allow the Exchange and the Commission additional time to analyze the impact of the Pilot Program.\13\ Accordingly, the Commission designates the proposed rule change as operative upon filing with the Commission.\14\ --------------------------------------------------------------------------- \10\ 17 CFR 240.19b-4(f)(6). \11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) requires the Exchange to give the Commission written notice of the Exchange's intent to file the proposed rule change along with a brief description and the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this pre-filing requirement. \12\ 17 CFR 240.19b-4(f)(6)(iii). \13\ See Securities Exchange Act Release No. 61061 (November 24, 2009), 74 FR 62857 (December 1, 2009) (SR-NYSEArca-2009-44). \14\ For purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). --------------------------------------------------------------------------- At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B) \15\ of the Act to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \15\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to rule-comments@sec.gov. Please include File Number SR-CboeEDGX-2018-021 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090. All submissions should refer to File Number SR-CboeEDGX-2018-021. 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 website (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for website viewing and printing in the Commission's Public Reference Room, 100 F Street NE, Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-CboeEDGX-2018-021 and should be submitted on or before July 27, 2018. --------------------------------------------------------------------------- \16\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\16\ Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-14466 Filed 7-5-18; 8:45 am] BILLING CODE 8011-01-P
![31576 Federal Register / Vol. 83, No. 130 / Friday, July 6, 2018 / Notices
SECURITIES AND EXCHANGE the proposed rule change and discussed prior to its expiration on June 30, 2018.
COMMISSION any comments it received on the The Exchange notes that this proposal
proposed rule change. The text of these does not propose any new policies or
[Release No. 34–83566; File No. SR– statements may be examined at the provisions that are unique or unproven,
CboeEDGX–2018–021] places specified in Item IV below. The but instead relates to the continuation of
Exchange has prepared summaries, set an existing program that operates on a
Self-Regulatory Organizations; Cboe
forth in Sections A, B, and C below, of pilot basis.
EDGX Exchange, Inc.; Notice of Filing
the most significant parts of such
and Immediate Effectiveness of a B. Self-Regulatory Organization’s
statements.
Proposed Rule Change to Rule 21.5, Statement on Burden on Competition
Minimum Increments, To Extend the A. Self-Regulatory Organization’s The Exchange does not believe that
Penny Pilot Program Statement of the Purpose of, and the proposed rule change will impose
Statutory Basis for, the Proposed Rule any burden on competition that is not
June 29, 2018. Change
Pursuant to Section 19(b)(1) of the necessary or appropriate in furtherance
Securities Exchange Act of 1934 (the 1. Purpose of the purposes of the Act. In this
‘‘Act’’),1 and Rule 19b–4 thereunder,2 The purpose of this filing is to extend regard, the Exchange notes that the rule
notice is hereby given that on June 26, the Penny Pilot, which was previously change is being proposed in order to
2018, Cboe EDGX Exchange, Inc. (the approved by the Commission, through continue the Pilot Program, which is a
‘‘Exchange’’ or ‘‘EDGX’’) filed with the December 31, 2018, and to provide competitive response to analogous
Securities and Exchange Commission revised dates for adding replacement programs offered by other options
(‘‘Commission’’) the proposed rule issues to the Pilot Program. The exchanges. The Exchange believes this
change as described in Items I and II Exchange proposes that any Pilot proposed rule change is necessary to
below, which Items have been prepared Program issues that have been delisted permit fair competition among the
by the Exchange. The Exchange has may be replaced on the second trading options exchanges.
designated this proposal as a ‘‘non- day following July 1, 2018. The C. Self-Regulatory Organization’s
controversial’’ proposed rule change replacement issues will be selected Statement on Comments on the
pursuant to Section 19(b)(3)(A) of the based on trading activity for the most Proposed Rule Change Received From
Act 3 and Rule 19b–4(f)(6)(iii) recent six month period excluding the Members, Participants, or Others
thereunder,4 which renders it effective month immediately preceding the
replacement (i.e., beginning December The Exchange has not solicited, and
upon filing with the Commission. The
1, 2017, and ending May 31, 2018). does not intend to solicit, comments on
Commission is publishing this notice to
The Exchange represents that the this proposed rule change. The
solicit comments on the proposed rule
Exchange has the necessary system Exchange has not received any written
change from interested persons.
capacity to continue to support comments from members or other
I. Self-Regulatory Organization’s operation of the Penny Pilot. The interested parties.
Statement of the Terms of Substance of Exchange believes the benefits to public III. Date of Effectiveness of the
the Proposed Rule Change customers and other market participants Proposed Rule Change and Timing for
The Exchange filed a proposal for the who will be able to express their true Commission Action
EDGX Options Market (‘‘EDGX prices to buy and sell options have been
demonstrated to outweigh the increase The Exchange has filed the proposed
Options’’) to extend through December
in quote traffic. rule change pursuant to Section
31, 2018, the Penny Pilot Program
19(b)(3)(A)(iii) of the Act 8 and Rule
(‘‘Penny Pilot’’) in options classes in 2. Statutory Basis 19b–4(f)(6) thereunder.9 Because the
certain issues (‘‘Pilot Program’’)
The Exchange believes that its proposed rule change does not: (i)
previously approved by the
proposal is consistent with the Significantly affect the protection of
Commission.5
requirements of the Act and the rules investors or the public interest; (ii)
The text of the proposed rule change
and regulations thereunder that are impose any significant burden on
is available at the Exchange’s website at
applicable to a national securities competition; and (iii) become operative
www.markets.cboe.com, at the principal
exchange, and, in particular, with the prior to 30 days from the date on which
office of the Exchange, and at the
requirements of Section 6(b) of the Act.6 it was filed, or such shorter time as the
Commission’s Public Reference Room.
In particular, the proposal is consistent Commission may designate, if
II. Self-Regulatory Organization’s with Section 6(b)(5) of the Act 7 because consistent with the protection of
Statement of the Purpose of, and it would promote just and equitable investors and the public interest, the
Statutory Basis for, the Proposed Rule principles of trade, remove proposed rule change has become
Change impediments to, and perfect the effective pursuant to Section 19(b)(3)(A)
In its filing with the Commission, the mechanism of, a free and open market of the Act and Rule 19b–4(f)(6)(iii)
Exchange included statements and a national market system. The thereunder.
Exchange believes that the Pilot A proposed rule change filed under
concerning the purpose of and basis for
Program promotes just and equitable Rule 19b–4(f)(6) 10 normally does not
1 15 U.S.C. 78s(b)(1). principles of trade by enabling public become operative prior to 30 days after
2 17 CFR 240.19b–4. customers and other market participants the date of the filing.11 However,
to express their true prices to buy and
daltland on DSKBBV9HB2PROD with NOTICES
3 15 U.S.C. 78s(b)(3)(A).
8 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6)(iii). sell options. Accordingly, the Exchange
9 17 CFR 240.19b–4(f)(6).
5 The rules of EDGX Options, including rules
believes that the proposal is consistent
10 17 CFR 240.19b–4(f)(6).
applicable to EDGX Options’ participation in the with the Act because it will allow the
Penny Pilot, were approved on August 7, 2015. See 11 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
Securities Exchange Act Release No. 75650 (August
Exchange to extend the Pilot Program 4(f)(6)(iii) requires the Exchange to give the
7, 2015), 80 FR 48600 (August 13, 2015) (SR– Commission written notice of the Exchange’s intent
6 15 U.S.C. 78f(b).
EDGX–2015 18). EDGX Options commenced to file the proposed rule change along with a brief
operations on November 2, 2015. 7 15 U.S.C. 78f(b)(5). description and the text of the proposed rule
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![Federal Register / Vol. 83, No. 130 / Friday, July 6, 2018 / Notices 31577
pursuant to Rule 19b–4(f)(6)(iii),12 the CboeEDGX–2018–021 on the subject SECURITIES AND EXCHANGE
Commission may designate a shorter line. COMMISSION
time if such action is consistent with the
protection of investors and the public Paper Comments [Release No. 34–83569; File No. SR–
interest. The Exchange has asked the CboeBZX–2018–049]
• Send paper comments in triplicate
Commission to waive the 30-day to Secretary, Securities and Exchange Self-Regulatory Organizations; Cboe
operative delay so that the proposal may Commission, 100 F Street NE, BZX Exchange, Inc.; Notice of Filing
become operative immediately upon and Immediate Effectiveness of a
Washington, DC 20549–1090.
filing. The Commission believes that Proposed Rule Change to Rule 21.5,
waiving the 30-day operative delay is All submissions should refer to File Minimum Increments, To Extend the
consistent with the protection of Number SR-CboeEDGX–2018–021. This Penny Pilot Program
investors and the public interest file number should be included on the
because doing so will allow the Pilot subject line if email is used. To help the June 29, 2018.
Program to continue without Commission process and review your Pursuant to Section 19(b)(1) of the
interruption in a manner that is comments more efficiently, please use Securities Exchange Act of 1934
consistent with the Commission’s prior only one method. The Commission will (‘‘Act’’),1 and Rule 19b–4 thereunder,2
approval of the extension and expansion post all comments on the Commission’s notice is hereby given that on June 26,
of the Pilot Program and will allow the internet website (http://www.sec.gov/ 2018, Cboe BZX Exchange, Inc.
Exchange and the Commission rules/sro.shtml). Copies of the (‘‘Exchange’’ or ‘‘BZX’’) filed with the
additional time to analyze the impact of submission, all subsequent Securities and Exchange Commission
the Pilot Program.13 Accordingly, the amendments, all written statements (‘‘Commission’’) the proposed rule
Commission designates the proposed change as described in Items I and II
with respect to the proposed rule
rule change as operative upon filing below, which Items have been prepared
change that are filed with the
with the Commission.14 by the Exchange. The Exchange has
Commission, and all written
At any time within 60 days of the designated this proposal as a ‘‘non-
communications relating to the
filing of such proposed rule change, the controversial’’ proposed rule change
proposed rule change between the
Commission summarily may pursuant to Section 19(b)(3)(A) of the
Commission and any person, other than Act 3 and Rule 19b–4(f)(6)(iii)
temporarily suspend such rule change if
it appears to the Commission that such those that may be withheld from the thereunder,4 which renders it effective
action is necessary or appropriate in the public in accordance with the upon filing with the Commission. The
public interest, for the protection of provisions of 5 U.S.C. 552, will be Commission is publishing this notice to
investors, or otherwise in furtherance of available for website viewing and solicit comments on the proposed rule
the purposes of the Act. If the printing in the Commission’s Public change from interested persons.
Commission takes such action, the Reference Room, 100 F Street NE,
Washington, DC 20549, on official I. Self-Regulatory Organization’s
Commission shall institute proceedings
business days between the hours of Statement of the Terms of Substance of
under Section 19(b)(2)(B) 15 of the Act to
10:00 a.m. and 3:00 p.m. Copies of the the Proposed Rule Change
determine whether the proposed rule
change should be approved or filing also will be available for The Exchange filed a proposal to for
disapproved. inspection and copying at the principal the BZX Options Market (‘‘BZX
office of the Exchange. All comments Options’’) to extend through December
IV. Solicitation of Comments 31, 2018, the Penny Pilot Program
received will be posted without change.
Interested persons are invited to Persons submitting comments are (‘‘Penny Pilot’’) in options classes in
submit written data, views, and cautioned that we do not redact or edit certain issues (‘‘Pilot Program’’)
arguments concerning the foregoing, personal identifying information from previously approved by the
including whether the proposed rule comment submissions. You should Commission.5
change is consistent with the Act. submit only information that you wish The text of the proposed rule change
Comments may be submitted by any of to make available publicly. All is available at the Exchange’s website at
the following methods: www.markets.cboe.com, at the principal
submissions should refer to File
office of the Exchange, and at the
Electronic Comments Number SR–CboeEDGX–2018–021 and
Commission’s Public Reference Room.
should be submitted on or before July
• Use the Commission’s internet 27, 2018. II. Self-Regulatory Organization’s
comment form (http://www.sec.gov/ Statement of the Purpose of, and
rules/sro.shtml); or For the Commission, by the Division of
Trading and Markets, pursuant to delegated
Statutory Basis for, the Proposed Rule
• Send an email to rule-comments@ Change
sec.gov. Please include File Number SR– authority.16
Eduardo A. Aleman, In its filing with the Commission, the
Assistant Secretary. Exchange included statements
change, at least five business days prior to the date
of filing of the proposed rule change, or such concerning the purpose of and basis for
[FR Doc. 2018–14466 Filed 7–5–18; 8:45 am]
shorter time as designated by the Commission. The
Exchange has satisfied this pre-filing requirement. BILLING CODE 8011–01–P 1 15 U.S.C. 78s(b)(1).
12 17 CFR 240.19b–4(f)(6)(iii). 2 17 CFR 240.19b–4.
daltland on DSKBBV9HB2PROD with NOTICES
13 See Securities Exchange Act Release No. 61061 3 15 U.S.C. 78s(b)(3)(A).
(November 24, 2009), 74 FR 62857 (December 1, 4 17 CFR 240.19b–4(f)(6)(iii).
2009) (SR–NYSEArca–2009–44). 5 The rules of BZX Options, including rules
14 For purposes only of waiving the operative
applicable to BZX Options’ participation in the
delay for this proposal, the Commission has Penny Pilot, were approved on January 26, 2010.
considered the proposed rule’s impact on See Securities Exchange Act Release No. 61419
efficiency, competition, and capital formation. See (January 26, 2010), 75 FR 5157 (February 1, 2010)
15 U.S.C. 78c(f). (SR–BATS–2009–031). BZX Options commenced
15 15 U.S.C. 78s(b)(2)(B). 16 17 CFR 200.30–3(a)(12). operations on February 26, 2010.
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Document Created: 2018-07-06 00:46:13
Document Modified: 2018-07-06 00:46:13
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 83 FR 31576 |
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