83_FR_52789 83 FR 52588 - Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Introduce Equities Purge Ports To (1) Establish Purge Ports for Equities Trading and Amend the Interpretations and Policies to Rule 11.10, Order Execution, To Reflect the Proposed Purge Ports, and (2) Modify the Fee Schedule Applicable to the Exchange's Equities Platform (“BZX Equities”) To Identify and To Set Fees for Purge Ports

83 FR 52588 - Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Introduce Equities Purge Ports To (1) Establish Purge Ports for Equities Trading and Amend the Interpretations and Policies to Rule 11.10, Order Execution, To Reflect the Proposed Purge Ports, and (2) Modify the Fee Schedule Applicable to the Exchange's Equities Platform (“BZX Equities”) To Identify and To Set Fees for Purge Ports

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 201 (October 17, 2018)

Page Range52588-52591
FR Document2018-22535

Federal Register, Volume 83 Issue 201 (Wednesday, October 17, 2018)
[Federal Register Volume 83, Number 201 (Wednesday, October 17, 2018)]
[Notices]
[Pages 52588-52591]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-22535]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84406; File No. SR-CboeBZX-2018-074]


Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To 
Introduce Equities Purge Ports To (1) Establish Purge Ports for 
Equities Trading and Amend the Interpretations and Policies to Rule 
11.10, Order Execution, To Reflect the Proposed Purge Ports, and (2) 
Modify the Fee Schedule Applicable to the Exchange's Equities Platform 
(``BZX Equities'') To Identify and To Set Fees for Purge Ports

October 11, 2018.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on September 28, 2018, Cboe BZX Exchange, Inc. (``Exchange'' or 
``BZX'') 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 is proposing to (1) establish Purge Ports for equities 
trading and amend the Interpretations and Policies to Rule 11.13, Order 
Execution and Routing, to reflect the proposed Purge Ports, and (2) 
modify the fee schedule applicable to the Exchange's equities platform 
(``BZX Equities'') to identify and to set fees for Purge Ports.
    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 the proposed rule change is to offer Users \5\ an 
additional tool to manage risk and exercise additional control over 
their quotations in equity securities (i.e., ``Purge Ports''). 
Specifically, the Exchange proposes to: (1) Establish Purge Ports for 
equities trading and amend the Interpretations and Policies to Rule 
11.13, Order Execution and Routing, to reflect the proposed Purge 
Ports, and (2) modify the fee schedule applicable to BZX Equities to 
identify and to set fees for Purge Ports.
---------------------------------------------------------------------------

    \5\ A ``User'' is any Member or Sponsored Participant who is 
authorized to obtain access to the System pursuant to Rule 11.3. See 
Rule 1.5(cc).
---------------------------------------------------------------------------

    Purge Ports are already available on the Exchange's affiliated 
options markets--i.e., the Exchange's options trading platform (``BZX 
Options''), the options trading platform of Cboe EDGX Exchange, Inc. 
(``EDGX Options''), and Cboe C2 Exchange, Inc. (``C2'').\6\ Based on 
the successful experience with Purge Ports for options, and in response 
to demand for similar functionality for equities trading, the Exchange 
has determined to offer Purge Ports on BZX Equities. The Exchange 
believes that the proposed Purge Port functionality will provide an 
effective tool for Users to manage their risk associated with equities 
trading.
---------------------------------------------------------------------------

    \6\ See Securities Exchange Act Release Nos. 79956 (February 3, 
2017), 82 FR 10102 (February 9, 2017) (SR-BatsBZX-2017-05); 79957 
(February 3, 2017), 82 FR 10070 (February 9, 2017) (SR-BatsEDGX-
2017-07); 83201 (May 9, 2018), 83 FR 22546 (May 15, 2018) (SR-C2-
2018-006).
---------------------------------------------------------------------------

Background
    A logical port represents a port established by the Exchange within 
the Exchange's system for trading and billing purposes. Each logical 
port established is specific to a Member or non-Member and grants that 
Member or non-Member the ability to accomplish a specific function, 
such as order entry, order cancellation, or data receipt. In addition, 
logical ports enable Users to access information such as execution 
reports, execution report messages, auction notifications, and 
administrative data through a single feed.
Purge Ports
    The Exchange now proposes to amend the Interpretations and Policies 
to Rule 11.13, Order Execution and Routing, to identify Purge Ports, a 
new type of logical port that would enable Users to cancel all open 
orders, or a subset thereof, across multiple logical ports through a 
single cancel message. The Exchange also proposes to amend the BZX 
Equities fee schedule to adopt fees for Purge Ports.
    The proposed ports are designed to assist Users, including Market 
Makers,\7\ in the management of, and risk control over, their quotes, 
particularly if the firm is quoting a large number of

[[Page 52589]]

securities. For example, if a Market Maker detects market indications 
that may influence the direction or bias of his or her quotes, the 
Market Maker may use the proposed Purge Port(s) to reduce uncertainty 
and to manage risk by purging all quotes in a number of securities. 
This would allow the firm to seamlessly avoid unintended executions, 
while continuing to evaluate the direction of the market. While Purge 
Ports will be available to all Users, the Exchange anticipates they 
will be used primarily by Market Makers or firms that conduct similar 
business activity and are therefore exposed to a large amount of risk 
across a number securities.
---------------------------------------------------------------------------

    \7\ A ``Market Maker'' is a Member that acts as a Market Maker 
pursuant to Chapter XI. See Rule 1.5(l).
---------------------------------------------------------------------------

    Users may currently cancel orders through their existing logical 
ports. In addition, the Exchange offers risk functionality pursuant to 
Interpretation and Policies .01 to Rule 11.13 that permits Users to 
block new orders from being submitted, to cancel all open orders, or to 
both block new orders and cancel all open orders. In addition to the 
current risk functionality, which is being retained, the Exchange now 
proposes to expand the ability of Users to cancel orders through the 
proposed Purge Ports, which would enable them to cancel all open 
orders, or a subset thereof, across multiple logical ports through a 
single cancel message. The mass cancel request may be limited to a 
subset of orders by identifying the range of orders to be purged. Users 
may also request via a Purge Port that the Exchange block all or a 
subset of new orders submitted, and the block will remain in effect 
until the User requests that the Exchange remove the block.
    The Exchange proposes to amend the Interpretations and Policies to 
Rule 11.13, Order Execution and Routing, to reflect the proposed Purge 
Port functionality. As described above, Interpretation and Policies .01 
to Rule 11.13 currently states that the Exchange offers risk 
functionality that permits Users to block new orders submitted, to 
cancel all open orders, or to both block new orders and cancel all open 
orders. The Exchange proposes to move this language to Interpretations 
and Policies .02(a) to Rule 11.13,\8\ and add additional language to 
describe the flexibility provided using the proposed Purge Ports. 
Specifically, as proposed, Interpretations and Policies .02(b) to Rule 
11.13 will state that a ``Purge Port'' is a dedicated port that permits 
a User to simultaneously cancel all or a subset of its orders in one or 
more symbols across multiple logical ports by requesting the Exchange 
to effect such cancellation. The proposed rule will also provide that a 
User initiating such a request may also request that the Exchange block 
all or a subset of its new inbound orders in one or more symbols across 
multiple logical ports. The block will remain in effect until the User 
requests the Exchange remove the block.
---------------------------------------------------------------------------

    \8\ The Exchange also proposes to make a non-substantive change 
that deletes the introductory clause of this sentence.
---------------------------------------------------------------------------

    In addition, the Exchange proposes to modify the Logical Port Fees 
section of the BZX Equities fee schedule to adopt a fee for Purge Ports 
of $650 per port/per month, which would compensate the Exchange for the 
investment that it has made in making Purge Ports available to firms 
that believe they would benefit from a dedicated purge mechanism. Only 
firms that request Purge Ports would be subject to the proposed fees, 
and other firms can continue to operate in exactly the same manner as 
they do today without dedicated Purge Ports.
2. Statutory Basis
    The Exchange believes that the proposed rule change 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.\9\ 
Specifically, the proposed rule change is consistent with Sections 
6(b)(4) and 6(b)(5) of the Act,\10\ because it is designed to provide 
for the equitable allocation of reasonable dues, fees and other charges 
among its members and other persons using its facilities, and is 
designed to promote just and equitable principles of trade, to foster 
cooperation and coordination with persons engaged in facilitating 
transactions in securities, to remove impediments to and perfect the 
mechanism of a free and open market and a national market system and, 
in general, to protect investors and the public interest.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change would promote 
just and equitable principles of trade and remove impediments to and 
perfect the mechanism of a free and open market because offering Users, 
including Market Makers, designated Purge Ports would enhance their 
ability to manage quotes, quote traffic, and their quoting 
obligations,\11\ which would, in turn, improve their risk controls to 
the benefit of all market participants. The Exchange believes that the 
Purge Ports would foster cooperation and coordination with persons 
engaged in facilitating transactions in securities because designating 
Purge Ports for purge messages (including blocking subsequent order 
entry) may encourage better use of such dedicated ports. This may, 
concurrent with the logical ports that carry quote and other 
information necessary for market making activities, enable more 
efficient, as well as fair and reasonable, use of Market Makers' 
resources. Although dedicated Purge Ports are a new innovation for 
equities exchanges, similar connectivity and functionality is offered 
by options exchanges, including the Exchange's own affiliated options 
exchanges.\12\ The Exchange believes that proper risk management, 
including the ability to efficiently cancel multiple orders at once, is 
similarly important to firms that trade in the equities market, 
including Market Makers that have heightened quoting obligations that 
are not applicable to other market participants.
---------------------------------------------------------------------------

    \11\ See Rule 11.8(d).
    \12\ See supra note 7. See also e.g. Nasdaq ISE, LLC, Schedule 
of Fees, V. Connectivity Fees, C. Ports and Other Services, SQF 
Purge Port Fee.
---------------------------------------------------------------------------

    The proposed rule change will not relieve Market Makers of their 
continuous quoting obligations under Rule 11.8(d) or firm quote 
obligations under Regulation NMS Rule 602.\13\ Specifically, any 
interest that is executable against a User's or Market Maker's quotes 
and orders that is received by the Exchange prior to the time of the 
removal of quotes request will automatically execute at that price, up 
to the quote's size. Market Makers that purge their quotes will not be 
relieved of the obligation to provide continuous two-sided quotes on a 
daily basis, nor will it prohibit the Exchange from taking disciplinary 
action against a Market Maker for failing to meet their continuous 
quoting obligation each trading day.
---------------------------------------------------------------------------

    \13\ 17 CFR 242.602.
---------------------------------------------------------------------------

    Dedicated Purge Ports, which were originally introduced for options 
trading, are a new feature in the equities market, and the Exchange is 
the first equities exchange to offer this functionality to Users. The 
Exchange has incurred additional infrastructure and technology costs in 
offering the proposed Purge Ports, including costs associated with the 
purchase of new hardware to support these dedicated ports, and software 
development, testing, and certification work associated with the risk 
management functionality made available through such ports. The 
Exchange also has continuing costs associated with maintenance and 
monitoring of the proposed ports. The Exchange believes

[[Page 52590]]

that its proposed fees should facilitate the ability of the Exchange to 
recoup some costs associated with Purge Ports as well as provide, 
maintain, and improve Purge Ports.\14\ The proposed fees therefore 
directly support the introduction of new and innovative risk management 
features to the market.
---------------------------------------------------------------------------

    \14\ Purge Ports will be fee liable on a monthly basis (and not 
only when such ports are active), which will help the Exchange to 
recoup the cost of these ports.
---------------------------------------------------------------------------

    The Exchange believes the proposed fee for Purge Ports is equitable 
and reasonable. The Exchange currently charges $550 per port/per month 
for logical ports.\15\ The Exchange believes it is equitable and 
reasonable to charge $650 per month for the proposed Purge Ports as 
such ports were specially developed to allow for the sending of a 
single message to cancel multiple orders, thereby assisting firms in 
effectively managing risk. In addition, Purge Port requests may cancel 
orders submitted over numerous ports and contain added functionality to 
purge only a subset of these orders. Effective risk management is 
important both for individual market participants that choose to 
utilize risk features provided by the Exchange, as well as for the 
market in general. As a result, the Exchange believes that it is 
appropriate to charge fees that compensate for the development of such 
functionality as doing so aids in the maintenance of a fair and orderly 
market.
---------------------------------------------------------------------------

    \15\ The fee for Multicast PITCH Spin Server ports provides 
access to a set of primary ports (A or C feed) and the fee for 
Multicast PITCH GRP Ports provides access to a primary port (A or C 
feed).
---------------------------------------------------------------------------

    The Exchange also believes that offering such functionality at the 
Exchange level promotes robust risk management across the industry, and 
thereby facilitates investor protection. Some market participants, and, 
in particular, the larger firms could build similar risk functionality 
on their trading systems that permit the flexible cancellation of 
orders entered on the Exchange. Offering Exchange level protections 
ensures that such functionality is widely available to all firms, 
including smaller firms that may otherwise not be willing to incur the 
costs and development work necessary to support their own customized 
mass cancel functionality.
    Although the Exchange is the first exchange to develop and offer 
dedicated Purge Ports for equities trading, the proposed rate is lower 
than that charged by options exchanges for similar functionality, 
including the fees charged by the Exchange's affiliated options 
exchanges for Options Purge Ports, which are billed at a rate of $750 
per month, and fees charged by unaffiliated options exchanges, such as 
ISE, which charges a fee of $1,100 per month for SQF Purge Ports. The 
Exchange operates in a highly competitive market in which exchanges 
offer connectivity and related services as a means to facilitate the 
trading activities of Members and other participants. As the proposed 
Purge Ports provide voluntary risk management functionality, excessive 
fees would simply serve to reduce demand for this optional product.
    The Exchange also believes that the proposed amendments to its fee 
schedule are not unfairly discriminatory because they will apply 
uniformly to all Members that choose to use dedicated Purge Ports. The 
proposed Purge Ports are completely voluntary and, as they relate 
solely to optional risk management functionality, no Member is required 
or under any regulatory obligation to utilize them. The Exchange 
believes that adopting separate fees for these ports ensures that the 
associated costs are borne exclusively by Members that determine to use 
them based on their business needs, including Market Makers or 
similarly situated market participants that enter orders simultaneously 
in a number of securities. All Members that voluntarily select this 
service option will be charged the same amount for the same services. 
All Members have the option to select any connectivity option, and 
there is no differentiation among Members with regard to the fees 
charged for the services offered by the Exchange.

(B) Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change would 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. To the contrary, the 
Exchange believes the proposed rule change will enhance competition 
because it will enable the Exchange to innovate and offer similar 
equities Purge Port functionality to that offered on options markets 
today, at a competitive price.\16\ The proposed Purge Ports are 
completely voluntary and will be made available to all Members on an 
equal basis. While the Exchange believes that the proposed Purge Ports 
provide a valuable service, Members can choose to purchase, or not 
purchase, these ports based on their business needs. No Member is 
required or under any regulatory obligation to utilize Purge Ports. 
Furthermore, fees for Purge Ports, and connectivity in general, are 
constrained by the robust competition for order flow among exchanges 
and non-exchange markets. Members may opt to disfavor the Exchange's 
pricing if they believe that alternatives offer them better value. As a 
result, excessive fees for connectivity, including Purge Port fees, 
would serve to impair the Exchange's ability to compete for order flow 
rather than burdening competition. Accordingly, the Exchange believes 
that the proposed rule change is designed to offer appropriate risk 
management functionality to firms that trade on the Exchange without 
imposing an unnecessary or inappropriate burden on competition.
---------------------------------------------------------------------------

    \16\ See supra note 13.
---------------------------------------------------------------------------

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

    No comments were solicited or received on the proposed rule change.

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

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \17\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\18\
---------------------------------------------------------------------------

    \17\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and 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 requirement.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \19\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, Rule 19b-4(f)(6)(iii) \20\ permits the Commission to 
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 proposed 
rule change may become effective and operative immediately upon filing. 
The Exchange noted that its affiliated options exchanges provide Purge 
Ports and that they have been successful for options. The Exchange 
noted that there is a demand for Purge Ports for equities

[[Page 52591]]

and that it believes that the Purge Ports will provide an effective 
risk management tool for Users trading equities. The Commission 
believes that Purge Ports may be a helpful tool for managing the risk 
associated with trading equities, and notes that this can be important 
both for individual market participants and the market in general. 
Accordingly, the Commission believes that permitting this feature to be 
operative upon filing is consistent with the protection of investors 
and the public interest. Therefore, the Commission hereby waives the 
30-day operative delay and designates the proposed rule change as 
operative upon filing.\21\
---------------------------------------------------------------------------

    \19\ 17 CFR 240.19b-4(f)(6).
    \20\ 17 CFR 240.19b-4(f)(6)(iii).
    \21\ For purposes only of waiving the 30-day operative delay, 
the Commission has also 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 the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) otherwise in furtherance of the 
purposes of the Act. If the Commission takes such action, the 
Commission shall institute proceedings to determine whether the 
proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-CboeBZX-2018-074 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-CboeBZX-2018-074. 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-CboeBZX-2018-074 and should be submitted 
on or before November 7, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\22\
---------------------------------------------------------------------------

    \22\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-22535 Filed 10-16-18; 8:45 am]
 BILLING CODE 8011-01-P



                                               52588                     Federal Register / Vol. 83, No. 201 / Wednesday, October 17, 2018 / Notices

                                               rules/sro.shtml). Copies of the                         September 28, 2018, Cboe BZX                            (1) Establish Purge Ports for equities
                                               submission, all subsequent                              Exchange, Inc. (‘‘Exchange’’ or ‘‘BZX’’)                trading and amend the Interpretations
                                               amendments, all written statements                      filed with the Securities and Exchange                  and Policies to Rule 11.13, Order
                                               with respect to the proposed rule                       Commission (‘‘Commission’’) the                         Execution and Routing, to reflect the
                                               change that are filed with the                          proposed rule change as described in                    proposed Purge Ports, and (2) modify
                                               Commission, and all written                             Items I and II below, which Items have                  the fee schedule applicable to BZX
                                               communications relating to the                          been prepared by the Exchange. The                      Equities to identify and to set fees for
                                               proposed rule change between the                        Exchange has designated this proposal                   Purge Ports.
                                               Commission and any person, other than                   as a ‘‘non-controversial’’ proposed rule                   Purge Ports are already available on
                                               those that may be withheld from the                     change pursuant to Section 19(b)(3)(A)                  the Exchange’s affiliated options
                                               public in accordance with the                           of the Act 3 and Rule 19b–4(f)(6)(iii)                  markets—i.e., the Exchange’s options
                                               provisions of 5 U.S.C. 552, will be                     thereunder,4 which renders it effective                 trading platform (‘‘BZX Options’’), the
                                               available for website viewing and                       upon filing with the Commission. The                    options trading platform of Cboe EDGX
                                               printing in the Commission’s Public                     Commission is publishing this notice to                 Exchange, Inc. (‘‘EDGX Options’’), and
                                               Reference Room, 100 F Street NE,                        solicit comments on the proposed rule                   Cboe C2 Exchange, Inc. (‘‘C2’’).6 Based
                                               Washington, DC 20549, on official                       change from interested persons.                         on the successful experience with Purge
                                               business days between the hours of                                                                              Ports for options, and in response to
                                               10:00 a.m. and 3:00 p.m. Copies of the                  I. Self-Regulatory Organization’s
                                                                                                                                                               demand for similar functionality for
                                               filing also will be available for                       Statement of the Terms of Substance of
                                                                                                                                                               equities trading, the Exchange has
                                               inspection and copying at the principal                 the Proposed Rule Change
                                                                                                                                                               determined to offer Purge Ports on BZX
                                               office of the Exchange. All comments                       The Exchange is proposing to (1)                     Equities. The Exchange believes that the
                                               received will be posted without change;                 establish Purge Ports for equities trading              proposed Purge Port functionality will
                                               Persons submitting comments are                         and amend the Interpretations and                       provide an effective tool for Users to
                                               cautioned that we do not redact or edit                 Policies to Rule 11.13, Order Execution                 manage their risk associated with
                                               personal identifying information from                   and Routing, to reflect the proposed                    equities trading.
                                               comment submissions. You should                         Purge Ports, and (2) modify the fee
                                               submit only information that you wish                   schedule applicable to the Exchange’s                   Background
                                               to make available publicly. All                         equities platform (‘‘BZX Equities’’) to                   A logical port represents a port
                                               submissions should refer to File                        identify and to set fees for Purge Ports.               established by the Exchange within the
                                               Number SR–NYSEAMER–2018–45, and                            The text of the proposed rule change                 Exchange’s system for trading and
                                               should be submitted on or before                        is available at the Exchange’s website at               billing purposes. Each logical port
                                               November 7, 2018.                                       www.markets.cboe.com, at the principal                  established is specific to a Member or
                                                 For the Commission, by the Division of                office of the Exchange, and at the                      non-Member and grants that Member or
                                               Trading and Markets, pursuant to delegated              Commission’s Public Reference Room.                     non-Member the ability to accomplish a
                                               authority.17                                                                                                    specific function, such as order entry,
                                                                                                       II. Self-Regulatory Organization’s
                                               Eduardo A. Aleman,                                                                                              order cancellation, or data receipt. In
                                                                                                       Statement of the Purpose of, and
                                               Assistant Secretary.                                    Statutory Basis for, the Proposed Rule                  addition, logical ports enable Users to
                                               [FR Doc. 2018–22532 Filed 10–16–18; 8:45 am]            Change                                                  access information such as execution
                                               BILLING CODE 8011–01–P                                                                                          reports, execution report messages,
                                                                                                          In its filing with the Commission, the               auction notifications, and
                                                                                                       Exchange included statements                            administrative data through a single
                                               SECURITIES AND EXCHANGE                                 concerning the purpose of and basis for                 feed.
                                               COMMISSION                                              the proposed rule change and discussed
                                                                                                       any comments it received on the                         Purge Ports
                                               [Release No. 34–84406; File No. SR–                     proposed rule change. The text of these
                                               CboeBZX–2018–074]                                                                                                  The Exchange now proposes to amend
                                                                                                       statements may be examined at the                       the Interpretations and Policies to Rule
                                               Self-Regulatory Organizations; Cboe                     places specified in Item IV below. The                  11.13, Order Execution and Routing, to
                                               BZX Exchange, Inc.; Notice of Filing                    Exchange has prepared summaries, set                    identify Purge Ports, a new type of
                                               and Immediate Effectiveness of a                        forth in Sections A, B, and C below, of                 logical port that would enable Users to
                                               Proposed Rule Change To Introduce                       the most significant parts of such                      cancel all open orders, or a subset
                                               Equities Purge Ports To (1) Establish                   statements.                                             thereof, across multiple logical ports
                                               Purge Ports for Equities Trading and                    (A) Self-Regulatory Organization’s                      through a single cancel message. The
                                               Amend the Interpretations and Policies                  Statement of the Purpose of, and                        Exchange also proposes to amend the
                                               to Rule 11.10, Order Execution, To                      Statutory Basis for, the Proposed Rule                  BZX Equities fee schedule to adopt fees
                                               Reflect the Proposed Purge Ports, and                   Change                                                  for Purge Ports.
                                               (2) Modify the Fee Schedule Applicable                                                                             The proposed ports are designed to
                                               to the Exchange’s Equities Platform                     1. Purpose                                              assist Users, including Market Makers,7
                                               (‘‘BZX Equities’’) To Identify and To Set                  The purpose of the proposed rule                     in the management of, and risk control
                                               Fees for Purge Ports                                    change is to offer Users 5 an additional                over, their quotes, particularly if the
                                                                                                       tool to manage risk and exercise                        firm is quoting a large number of
                                               October 11, 2018.
                                                                                                       additional control over their quotations
                                                  Pursuant to Section 19(b)(1) of the
daltland on DSKBBV9HB2PROD with NOTICES




                                                                                                                                                                 6 See Securities Exchange Act Release Nos. 79956
                                                                                                       in equity securities (i.e., ‘‘Purge Ports’’).
                                               Securities Exchange Act of 1934                         Specifically, the Exchange proposes to:                 (February 3, 2017), 82 FR 10102 (February 9, 2017)
                                               (‘‘Act’’),1 and Rule 19b–4 thereunder,2                                                                         (SR–BatsBZX–2017–05); 79957 (February 3, 2017),
                                                                                                                                                               82 FR 10070 (February 9, 2017) (SR–BatsEDGX–
                                               notice is hereby given that on                            3 15 U.S.C. 78s(b)(3)(A).                             2017–07); 83201 (May 9, 2018), 83 FR 22546 (May
                                                                                                         4 17 CFR 240.19b–4(f)(6)(iii).                        15, 2018) (SR–C2–2018–006).
                                                 17 17 CFR 200.30–3(a)(12).                              5 A ‘‘User’’ is any Member or Sponsored                 7 A ‘‘Market Maker’’ is a Member that acts as a
                                                 1 15 U.S.C. 78s(b)(1).                                Participant who is authorized to obtain access to the   Market Maker pursuant to Chapter XI. See Rule
                                                 2 17 CFR 240.19b–4.                                   System pursuant to Rule 11.3. See Rule 1.5(cc).         1.5(l).



                                          VerDate Sep<11>2014   19:46 Oct 16, 2018   Jkt 247001   PO 00000   Frm 00213   Fmt 4703   Sfmt 4703   E:\FR\FM\17OCN1.SGM    17OCN1


                                                                         Federal Register / Vol. 83, No. 201 / Wednesday, October 17, 2018 / Notices                                                    52589

                                               securities. For example, if a Market                    across multiple logical ports by                      persons engaged in facilitating
                                               Maker detects market indications that                   requesting the Exchange to effect such                transactions in securities because
                                               may influence the direction or bias of                  cancellation. The proposed rule will                  designating Purge Ports for purge
                                               his or her quotes, the Market Maker may                 also provide that a User initiating such              messages (including blocking
                                               use the proposed Purge Port(s) to reduce                a request may also request that the                   subsequent order entry) may encourage
                                               uncertainty and to manage risk by                       Exchange block all or a subset of its new             better use of such dedicated ports. This
                                               purging all quotes in a number of                       inbound orders in one or more symbols                 may, concurrent with the logical ports
                                               securities. This would allow the firm to                across multiple logical ports. The block              that carry quote and other information
                                               seamlessly avoid unintended                             will remain in effect until the User                  necessary for market making activities,
                                               executions, while continuing to evaluate                requests the Exchange remove the block.               enable more efficient, as well as fair and
                                               the direction of the market. While Purge                   In addition, the Exchange proposes to              reasonable, use of Market Makers’
                                               Ports will be available to all Users, the               modify the Logical Port Fees section of               resources. Although dedicated Purge
                                               Exchange anticipates they will be used                  the BZX Equities fee schedule to adopt                Ports are a new innovation for equities
                                               primarily by Market Makers or firms                     a fee for Purge Ports of $650 per port/               exchanges, similar connectivity and
                                               that conduct similar business activity                  per month, which would compensate                     functionality is offered by options
                                               and are therefore exposed to a large                    the Exchange for the investment that it               exchanges, including the Exchange’s
                                               amount of risk across a number                          has made in making Purge Ports                        own affiliated options exchanges.12 The
                                               securities.                                             available to firms that believe they                  Exchange believes that proper risk
                                                  Users may currently cancel orders                    would benefit from a dedicated purge                  management, including the ability to
                                               through their existing logical ports. In                mechanism. Only firms that request                    efficiently cancel multiple orders at
                                               addition, the Exchange offers risk                      Purge Ports would be subject to the                   once, is similarly important to firms that
                                               functionality pursuant to Interpretation                proposed fees, and other firms can                    trade in the equities market, including
                                               and Policies .01 to Rule 11.13 that                     continue to operate in exactly the same               Market Makers that have heightened
                                               permits Users to block new orders from                  manner as they do today without                       quoting obligations that are not
                                               being submitted, to cancel all open                     dedicated Purge Ports.                                applicable to other market participants.
                                               orders, or to both block new orders and                                                                          The proposed rule change will not
                                                                                                       2. Statutory Basis
                                               cancel all open orders. In addition to the                                                                    relieve Market Makers of their
                                               current risk functionality, which is                       The Exchange believes that the                     continuous quoting obligations under
                                               being retained, the Exchange now                        proposed rule change is consistent with               Rule 11.8(d) or firm quote obligations
                                               proposes to expand the ability of Users                 the requirements of the Act and the                   under Regulation NMS Rule 602.13
                                               to cancel orders through the proposed                   rules and regulations thereunder that                 Specifically, any interest that is
                                               Purge Ports, which would enable them                    are applicable to a national securities               executable against a User’s or Market
                                               to cancel all open orders, or a subset                  exchange, and, in particular, with the                Maker’s quotes and orders that is
                                               thereof, across multiple logical ports                  requirements of Section 6(b) of the Act.9             received by the Exchange prior to the
                                               through a single cancel message. The                    Specifically, the proposed rule change is             time of the removal of quotes request
                                               mass cancel request may be limited to                   consistent with Sections 6(b)(4) and                  will automatically execute at that price,
                                               a subset of orders by identifying the                   6(b)(5) of the Act,10 because it is                   up to the quote’s size. Market Makers
                                               range of orders to be purged. Users may                 designed to provide for the equitable                 that purge their quotes will not be
                                               also request via a Purge Port that the                  allocation of reasonable dues, fees and               relieved of the obligation to provide
                                               Exchange block all or a subset of new                   other charges among its members and                   continuous two-sided quotes on a daily
                                               orders submitted, and the block will                    other persons using its facilities, and is            basis, nor will it prohibit the Exchange
                                               remain in effect until the User requests                designed to promote just and equitable                from taking disciplinary action against a
                                               that the Exchange remove the block.                     principles of trade, to foster cooperation            Market Maker for failing to meet their
                                                  The Exchange proposes to amend the                   and coordination with persons engaged                 continuous quoting obligation each
                                               Interpretations and Policies to Rule                    in facilitating transactions in securities,           trading day.
                                               11.13, Order Execution and Routing, to                  to remove impediments to and perfect                     Dedicated Purge Ports, which were
                                               reflect the proposed Purge Port                         the mechanism of a free and open                      originally introduced for options
                                               functionality. As described above,                      market and a national market system                   trading, are a new feature in the equities
                                               Interpretation and Policies .01 to Rule                 and, in general, to protect investors and             market, and the Exchange is the first
                                               11.13 currently states that the Exchange                the public interest.                                  equities exchange to offer this
                                               offers risk functionality that permits                     The Exchange believes that the                     functionality to Users. The Exchange
                                               Users to block new orders submitted, to                 proposed rule change would promote                    has incurred additional infrastructure
                                               cancel all open orders, or to both block                just and equitable principles of trade                and technology costs in offering the
                                               new orders and cancel all open orders.                  and remove impediments to and perfect                 proposed Purge Ports, including costs
                                               The Exchange proposes to move this                      the mechanism of a free and open                      associated with the purchase of new
                                               language to Interpretations and Policies                market because offering Users,                        hardware to support these dedicated
                                               .02(a) to Rule 11.13,8 and add additional               including Market Makers, designated                   ports, and software development,
                                               language to describe the flexibility                    Purge Ports would enhance their ability               testing, and certification work
                                               provided using the proposed Purge                       to manage quotes, quote traffic, and                  associated with the risk management
                                               Ports. Specifically, as proposed,                       their quoting obligations,11 which                    functionality made available through
                                               Interpretations and Policies .02(b) to                  would, in turn, improve their risk                    such ports. The Exchange also has
                                               Rule 11.13 will state that a ‘‘Purge Port’’             controls to the benefit of all market
daltland on DSKBBV9HB2PROD with NOTICES




                                                                                                                                                             continuing costs associated with
                                               is a dedicated port that permits a User                 participants. The Exchange believes that              maintenance and monitoring of the
                                               to simultaneously cancel all or a subset                the Purge Ports would foster                          proposed ports. The Exchange believes
                                               of its orders in one or more symbols                    cooperation and coordination with
                                                                                                                                                               12 See supra note 7. See also e.g. Nasdaq ISE, LLC,
                                                                                                         9 15 U.S.C. 78f(b).
                                                 8 The Exchange also proposes to make a non-                                                                 Schedule of Fees, V. Connectivity Fees, C. Ports and
                                                                                                         10 15 U.S.C. 78f(b)(4) and (5).                     Other Services, SQF Purge Port Fee.
                                               substantive change that deletes the introductory
                                               clause of this sentence.                                  11 See Rule 11.8(d).                                  13 17 CFR 242.602.




                                          VerDate Sep<11>2014   19:46 Oct 16, 2018   Jkt 247001   PO 00000   Frm 00214   Fmt 4703   Sfmt 4703   E:\FR\FM\17OCN1.SGM   17OCN1


                                               52590                     Federal Register / Vol. 83, No. 201 / Wednesday, October 17, 2018 / Notices

                                               that its proposed fees should facilitate                month, and fees charged by unaffiliated                competition for order flow among
                                               the ability of the Exchange to recoup                   options exchanges, such as ISE, which                  exchanges and non-exchange markets.
                                               some costs associated with Purge Ports                  charges a fee of $1,100 per month for                  Members may opt to disfavor the
                                               as well as provide, maintain, and                       SQF Purge Ports. The Exchange operates                 Exchange’s pricing if they believe that
                                               improve Purge Ports.14 The proposed                     in a highly competitive market in which                alternatives offer them better value. As
                                               fees therefore directly support the                     exchanges offer connectivity and related               a result, excessive fees for connectivity,
                                               introduction of new and innovative risk                 services as a means to facilitate the                  including Purge Port fees, would serve
                                               management features to the market.                      trading activities of Members and other                to impair the Exchange’s ability to
                                                  The Exchange believes the proposed                   participants. As the proposed Purge                    compete for order flow rather than
                                               fee for Purge Ports is equitable and                    Ports provide voluntary risk                           burdening competition. Accordingly,
                                               reasonable. The Exchange currently                      management functionality, excessive                    the Exchange believes that the proposed
                                               charges $550 per port/per month for                     fees would simply serve to reduce                      rule change is designed to offer
                                               logical ports.15 The Exchange believes it               demand for this optional product.                      appropriate risk management
                                               is equitable and reasonable to charge                      The Exchange also believes that the                 functionality to firms that trade on the
                                               $650 per month for the proposed Purge                   proposed amendments to its fee                         Exchange without imposing an
                                               Ports as such ports were specially                      schedule are not unfairly discriminatory               unnecessary or inappropriate burden on
                                               developed to allow for the sending of a                 because they will apply uniformly to all               competition.
                                               single message to cancel multiple                       Members that choose to use dedicated
                                               orders, thereby assisting firms in                      Purge Ports. The proposed Purge Ports                  (C) Self-Regulatory Organization’s
                                               effectively managing risk. In addition,                 are completely voluntary and, as they                  Statement on Comments on the
                                               Purge Port requests may cancel orders                   relate solely to optional risk                         Proposed Rule Change Received From
                                               submitted over numerous ports and                       management functionality, no Member                    Members, Participants or Others
                                               contain added functionality to purge                    is required or under any regulatory                      No comments were solicited or
                                               only a subset of these orders. Effective                obligation to utilize them. The Exchange               received on the proposed rule change.
                                               risk management is important both for                   believes that adopting separate fees for               III. Date of Effectiveness of the
                                               individual market participants that                     these ports ensures that the associated                Proposed Rule Change and Timing for
                                               choose to utilize risk features provided                costs are borne exclusively by Members                 Commission Action
                                               by the Exchange, as well as for the                     that determine to use them based on
                                               market in general. As a result, the                     their business needs, including Market                    Because the foregoing proposed rule
                                               Exchange believes that it is appropriate                Makers or similarly situated market                    change does not: (i) Significantly affect
                                               to charge fees that compensate for the                  participants that enter orders                         the protection of investors or the public
                                               development of such functionality as                    simultaneously in a number of                          interest; (ii) impose any significant
                                               doing so aids in the maintenance of a                   securities. All Members that voluntarily               burden on competition; and (iii) become
                                               fair and orderly market.                                select this service option will be                     operative for 30 days from the date on
                                                  The Exchange also believes that                      charged the same amount for the same                   which it was filed, or such shorter time
                                               offering such functionality at the                      services. All Members have the option                  as the Commission may designate, it has
                                               Exchange level promotes robust risk                     to select any connectivity option, and                 become effective pursuant to Section
                                               management across the industry, and                     there is no differentiation among                      19(b)(3)(A)(iii) of the Act 17 and
                                               thereby facilitates investor protection.                Members with regard to the fees charged                subparagraph (f)(6) of Rule 19b–4
                                               Some market participants, and, in                       for the services offered by the Exchange.              thereunder.18
                                               particular, the larger firms could build                                                                          A proposed rule change filed under
                                                                                                       (B) Self-Regulatory Organization’s                     Rule 19b–4(f)(6) 19 normally does not
                                               similar risk functionality on their                     Statement on Burden on Competition                     become operative prior to 30 days after
                                               trading systems that permit the flexible
                                                                                                         The Exchange does not believe that                   the date of the filing. However, Rule
                                               cancellation of orders entered on the
                                                                                                       the proposed rule change would impose                  19b–4(f)(6)(iii) 20 permits the
                                               Exchange. Offering Exchange level
                                                                                                       any burden on competition that is not                  Commission to designate a shorter time
                                               protections ensures that such
                                                                                                       necessary or appropriate in furtherance                if such action is consistent with the
                                               functionality is widely available to all
                                                                                                       of the purposes of the Act. To the                     protection of investors and the public
                                               firms, including smaller firms that may
                                                                                                       contrary, the Exchange believes the                    interest. The Exchange has asked the
                                               otherwise not be willing to incur the
                                                                                                       proposed rule change will enhance                      Commission to waive the 30-day
                                               costs and development work necessary
                                                                                                       competition because it will enable the                 operative delay so that the proposed
                                               to support their own customized mass
                                                                                                       Exchange to innovate and offer similar                 rule change may become effective and
                                               cancel functionality.
                                                  Although the Exchange is the first                   equities Purge Port functionality to that              operative immediately upon filing. The
                                               exchange to develop and offer dedicated                 offered on options markets today, at a                 Exchange noted that its affiliated
                                               Purge Ports for equities trading, the                   competitive price.16 The proposed                      options exchanges provide Purge Ports
                                               proposed rate is lower than that charged                Purge Ports are completely voluntary                   and that they have been successful for
                                               by options exchanges for similar                        and will be made available to all                      options. The Exchange noted that there
                                               functionality, including the fees charged               Members on an equal basis. While the                   is a demand for Purge Ports for equities
                                               by the Exchange’s affiliated options                    Exchange believes that the proposed
                                                                                                                                                                17 15  U.S.C. 78s(b)(3)(A)(iii).
                                               exchanges for Options Purge Ports,                      Purge Ports provide a valuable service,
                                                                                                                                                                18 17  CFR 240.19b–4(f)(6). In addition, Rule 19b–
                                               which are billed at a rate of $750 per                  Members can choose to purchase, or not
                                                                                                                                                              4(f)(6)(iii) requires a self-regulatory organization to
                                                                                                       purchase, these ports based on their
daltland on DSKBBV9HB2PROD with NOTICES




                                                                                                                                                              give the Commission written notice of its intent to
                                                 14 Purge Ports will be fee liable on a monthly        business needs. No Member is required                  file the proposed rule change, along with a brief
                                               basis (and not only when such ports are active),        or under any regulatory obligation to                  description and text of the proposed rule change,
                                               which will help the Exchange to recoup the cost of      utilize Purge Ports. Furthermore, fees for             at least five business days prior to the date of filing
                                               these ports.                                                                                                   of the proposed rule change, or such shorter time
                                                 15 The fee for Multicast PITCH Spin Server ports
                                                                                                       Purge Ports, and connectivity in general,              as designated by the Commission. The Exchange
                                               provides access to a set of primary ports (A or C       are constrained by the robust                          has satisfied this requirement.
                                                                                                                                                                 19 17 CFR 240.19b–4(f)(6).
                                               feed) and the fee for Multicast PITCH GRP Ports
                                               provides access to a primary port (A or C feed).          16 See   supra note 13.                                 20 17 CFR 240.19b–4(f)(6)(iii).




                                          VerDate Sep<11>2014   19:46 Oct 16, 2018   Jkt 247001   PO 00000   Frm 00215    Fmt 4703   Sfmt 4703   E:\FR\FM\17OCN1.SGM    17OCN1


                                                                         Federal Register / Vol. 83, No. 201 / Wednesday, October 17, 2018 / Notices                                                  52591

                                               and that it believes that the Purge Ports               submission, all subsequent                            due, fee, or other charge imposed by the
                                               will provide an effective risk                          amendments, all written statements                    Exchange under Section 19(b)(3)(A)(ii)
                                               management tool for Users trading                       with respect to the proposed rule                     of the Act 3 and Rule 19b–4(f)(2)
                                               equities. The Commission believes that                  change that are filed with the                        thereunder,4 which renders the
                                               Purge Ports may be a helpful tool for                   Commission, and all written                           proposed rule change effective upon
                                               managing the risk associated with                       communications relating to the                        filing with the Commission. The
                                               trading equities, and notes that this can               proposed rule change between the                      Commission is publishing this notice to
                                               be important both for individual market                 Commission and any person, other than                 solicit comments on the proposed rule
                                               participants and the market in general.                 those that may be withheld from the                   change from interested persons.
                                               Accordingly, the Commission believes                    public in accordance with the
                                               that permitting this feature to be                      provisions of 5 U.S.C. 552, will be                   I. Self-Regulatory Organization’s
                                               operative upon filing is consistent with                available for website viewing and                     Statement of the Terms of Substance of
                                               the protection of investors and the                     printing in the Commission’s Public                   the Proposed Rule Change
                                               public interest. Therefore, the                         Reference Room, 100 F Street NE,
                                               Commission hereby waives the 30-day                     Washington, DC 20549, on official                        The Exchange filed a proposal to add
                                               operative delay and designates the                      business days between the hours of                    certain fees related to the listing and
                                               proposed rule change as operative upon                  10:00 a.m. and 3:00 p.m. Copies of the                trading of options that overlie the
                                               filing.21                                               filing also will be available for                     Russell 2000 Index (‘‘RUT options’’).
                                                  At any time within 60 days of the                    inspection and copying at the principal                  The text of the proposed rule change
                                               filing of the proposed rule change, the                 office of the Exchange. All comments                  is available at the Exchange’s website at
                                               Commission summarily may                                received will be posted without change.               www.markets.cboe.com, at the principal
                                               temporarily suspend such rule change if                 Persons submitting comments are                       office of the Exchange, and at the
                                               it appears to the Commission that such                  cautioned that we do not redact or edit               Commission’s Public Reference Room.
                                               action is: (i) Necessary or appropriate in              personal identifying information from
                                               the public interest; (ii) for the protection            comment submissions. You should                       II. Self-Regulatory Organization’s
                                               of investors; or (iii) otherwise in                     submit only information that you wish                 Statement of the Purpose of, and
                                               furtherance of the purposes of the Act.                 to make available publicly. All                       Statutory Basis for, the Proposed Rule
                                               If the Commission takes such action, the                submissions should refer to File                      Change
                                               Commission shall institute proceedings                  Number SR–CboeBZX–2018–074 and
                                               to determine whether the proposed rule                  should be submitted on or before                        In its filing with the Commission, the
                                               should be approved or disapproved.                      November 7, 2018.                                     Exchange included statements
                                                                                                                                                             concerning the purpose of and basis for
                                               IV. Solicitation of Comments                              For the Commission, by the Division of              the proposed rule change and discussed
                                                                                                       Trading and Markets, pursuant to delegated
                                                 Interested persons are invited to                     authority.22                                          any comments it received on the
                                               submit written data, views, and                         Eduardo A. Aleman,
                                                                                                                                                             proposed rule change. The text of these
                                               arguments concerning the foregoing,                                                                           statements may be examined at the
                                                                                                       Assistant Secretary.
                                               including whether the proposed rule                                                                           places specified in Item IV below. The
                                                                                                       [FR Doc. 2018–22535 Filed 10–16–18; 8:45 am]
                                               change is consistent with the Act.                                                                            Exchange has prepared summaries, set
                                                                                                       BILLING CODE 8011–01–P
                                               Comments may be submitted by any of                                                                           forth in Sections A, B, and C below, of
                                               the following methods:                                                                                        the most significant parts of such
                                                                                                                                                             statements.
                                               Electronic Comments                                     SECURITIES AND EXCHANGE
                                                 • Use the Commission’s internet                       COMMISSION                                            A. Self-Regulatory Organization’s
                                               comment form (http://www.sec.gov/                       [Release No. 34–84401; File No. SR–                   Statement of the Purpose of, and the
                                               rules/sro.shtml); or                                    CboeBZX–2018–075]                                     Statutory Basis for, the Proposed Rule
                                                 • Send an email to rule-comments@                                                                           Change
                                               sec.gov. Please include File Number SR–                 Self-Regulatory Organizations; Cboe
                                                                                                       BZX Exchange, Inc.; Notice of Filing                  1. Purpose
                                               CboeBZX–2018–074 on the subject line.
                                                                                                       and Immediate Effectiveness of a                         On September 27, 2018, the
                                               Paper Comments                                          Proposed Rule Change Related to Fees                  Exchange’s equity options platform
                                                  • Send paper comments in triplicate                  on Cboe BZX Exchange, Inc.                            (‘‘BZX Options’’) received approval
                                               to Secretary, Securities and Exchange                                                                         from the Commission to list and trade
                                                                                                       October 11, 2018.
                                               Commission, 100 F Street NE,
                                                                                                          Pursuant to Section 19(b)(1) of the                RUT options.5 The Exchange intends to
                                               Washington, DC 20549–1090.
                                                                                                       Securities Exchange Act of 1934 (the                  begin listing RUT options for trading on
                                               All submissions should refer to File                                                                          October 1, 2018. Accordingly, the
                                                                                                       ‘‘Act’’),1 and Rule 19b–4 thereunder,2
                                               Number SR–CboeBZX–2018–074. This                                                                              Exchange proposes to amend its Fees
                                                                                                       notice is hereby given that on October
                                               file number should be included on the                                                                         Schedule for BZX Options to add: (i) An
                                                                                                       1, 2018, Cboe BZX Exchange, Inc. (the
                                               subject line if email is used. To help the              ‘‘Exchange’’ or ‘‘BZX’’) filed with the               Index License Surcharge Fee to all Non-
                                               Commission process and review your                      Securities and Exchange Commission                    Customer transactions in RUT options;
                                               comments more efficiently, please use                   (‘‘Commission’’) the proposed rule                    (ii) Fee codes for RUT options that add
                                               only one method. The Commission will                    change as described in Items I, II and III            or remove liquidity on the Exchange;
                                               post all comments on the Commission’s                   below, which Items have been prepared                 and (iii) Fee codes for RUT options that
daltland on DSKBBV9HB2PROD with NOTICES




                                               internet website (http://www.sec.gov/                   by the Exchange. The Exchange has                     are routed away from the Exchange,
                                               rules/sro.shtml). Copies of the                         designated the proposed rule change as                effective October 1, 2018.
                                                  21 For purposes only of waiving the 30-day
                                                                                                       one establishing or changing a member
                                                                                                                                                               3 15 U.S.C. 78s(b)(3)(A)(ii).
                                               operative delay, the Commission has also
                                                                                                         22 17 CFR 200.30–3(a)(12).                            4 17
                                               considered the proposed rule’s impact on                                                                             CFR 240.19b–4(f)(2).
                                                                                                         1 15 U.S.C. 78s(b)(1).
                                               efficiency, competition, and capital formation. See                                                             5 See Securities Exchange Act Release No. 84298

                                               15 U.S.C. 78c(f).                                         2 17 CFR 240.19b–4.                                 (September 27, 2018) (SR–CboeBZX–2018–058).



                                          VerDate Sep<11>2014   19:46 Oct 16, 2018   Jkt 247001   PO 00000   Frm 00216   Fmt 4703   Sfmt 4703   E:\FR\FM\17OCN1.SGM   17OCN1



Document Created: 2018-10-17 01:48:23
Document Modified: 2018-10-17 01:48:23
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation83 FR 52588 

2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR