83_FR_59655 83 FR 59429 - Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Permit Up to Ten Expiration Months for Long-Term Options on the SPDR® S&P® 500 Exchange-Traded Fund Shares (“SPY”)

83 FR 59429 - Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Permit Up to Ten Expiration Months for Long-Term Options on the SPDR® S&P® 500 Exchange-Traded Fund Shares (“SPY”)

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 226 (November 23, 2018)

Page Range59429-59431
FR Document2018-25469

Federal Register, Volume 83 Issue 226 (Friday, November 23, 2018)
[Federal Register Volume 83, Number 226 (Friday, November 23, 2018)]
[Notices]
[Pages 59429-59431]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-25469]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84612; File No. SR-BOX-2018-35]


Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Permit Up to Ten 
Expiration Months for Long-Term Options on the SPDR[supreg] S&P[supreg] 
500 Exchange-Traded Fund Shares (``SPY'')

November 16, 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 November 16, 2018, BOX Exchange LLC (``Exchange'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I and II below, which Items have been 
prepared by the self-regulatory organization. The Commission is 
publishing this notice to solicit comments on the proposed rule from 
interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend BOX Rule 5070 (Long-term Options 
Contracts) to permit up to ten (10) expiration months for long-term 
options on SPY. The text of the proposed rule change is available from 
the principal office of the Exchange, at the Commission's Public 
Reference Room and also on the Exchange's internet website at http://boxoptions.com.

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

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of these statements may be examined at 
the places specified in Item IV below. The self-regulatory organization 
has prepared summaries, set forth in Sections A, B, and C below, of the 
most significant aspects of such statements.

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

1. Purpose
    The Exchange proposes to amend BOX Rule 5070 (Long-term Options 
Contracts) to permit up to ten (10) long-term options (``LEAPS'') 
expiration months for options on SPY.\3\ BOX Rule 5070 currently 
provides that the Exchange may list LEAPS that expire from twelve (12) 
to one hundred eighty (180) months from the time they are listed; and 
there may be up to six (6) expiration months.\4\ The Exchange believes 
the proposal will add liquidity to the SPY options market by allowing 
market participants to hedge risks relating to SPY positions over a 
longer time period with a known and limited cost. This is a filing that 
is based on a proposal recently submitted by Nasdaq PHLX LLC 
(``Phlx'').\5\
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    \3\ In contrast to Rule 5070, Exchange Rule 6090(b)(1)(i), which 
applies to index options, permits the Exchange to list LEAPS on any 
class of index options, adding up to ten expiration months. The 
Exchange seeks to list ten expiration months of LEAPS on SPY, just 
as it now may list ten LEAPS expiration months on index options, in 
order to provide investors with a wider choice of investments.
    \4\ Strike price interval, bid/ask differential and continuity 
rules shall not apply to such options series until the time to 
expiration is less than nine (9) months. See BOX Rule 5070(a).
    \5\ See Securities Exchange Act Release No. 34-84449 (October 
18, 2018), 83 FR 53699 (SR-Phlx-2018-64).
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    The SPY options market today is characterized by its tremendous 
daily and annual liquidity. As a consequence, the Exchange believes 
that the listing of additional SPY LEAPS expiration months would be 
well received by investors. This proposal to expand the number of 
permitted SPY long-term expiration months would not apply to LEAPS on 
any other class of stock or Exchange-Traded Fund Shares.\6\
---------------------------------------------------------------------------

    \6\ Historically, SPY is the largest and most actively traded 
ETF in the United States as measured by its assets under management 
and the value of shares traded.
---------------------------------------------------------------------------

    Finally, BOX Rule 5070(a) currently states that there may be ``up 
to six (6) additional expiration months.'' Because the rule does not 
specify which expiration months the six months are in addition to, and 
thus is ambiguous, the Exchange proposes to delete the word 
``additional.'' As amended, the rule would clearly and simply provide 
that the Exchange may list six expiration months having from twelve 
(12) to one

[[Page 59430]]

hundred eighty (180) months from the time they are listed until 
expiration.\7\
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    \7\ The Exchange notes other exchanges have amended their 
rulebook to also clarify this language. See Securities Exchange Act 
Release No. 34-80769 (May 25, 2017), 82 FR 25472 (SR-Phlx-2017-41).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Securities Exchange Act of 1934 
(the ``Act''),\8\ in general, and Section 6(b)(5) of the Act,\9\ in 
particular, in that it is designed to promote just and equitable 
principles of trade, to remove impediments to and perfect the mechanism 
of a free and open market and a national market system, and, in general 
to protect investors and the public interest by offering market 
participants additional LEAPS on SPY options for their investment and 
risk management purposes. The proposal is intended simply to provide 
additional trading opportunities, thereby facilitating transactions in 
options and contributing to the protection of investors and the 
maintenance of fair and orderly markets.\10\ The proposed rule change 
seeks to fulfill the needs of market participants, particularly 
portfolio managers and other institutional customers, by providing 
protection from long-term market moves and by offering an alternative 
to hedging portfolios with futures positions or off-exchange customized 
derivatives instruments.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
    \10\ As previously mentioned, the Exchange notes that this 
filing is based on a proposal recently submitted by Phlx, in which 
Phlx states the reason for filing is, in part, customer demand.
---------------------------------------------------------------------------

    The Exchange believes that additional expiration months for SPY 
LEAPS does not represent a proliferation of expiration months, but is 
instead a very modest expansion of LEAPS options. Significantly, the 
proposal would feature new LEAPS expiration months in only a single 
class of options that are very liquid and heavily traded, as discussed 
above. Additionally, the Exchange notes by way of precedent that ten 
expiration months are already permitted for index LEAPS options. 
Further, the Exchange has the necessary systems capacity to support the 
new SPY expiration months.

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The proposal merely provides 
investors additional investment and risk management opportunities by 
providing flexibility to the Exchange to list additional long term 
options expiration series, expanding the number of SPY LEAPS offered on 
the Exchange from six expiration months to ten expiration months. As 
indicated above, the Exchange notes that this filing is based on a 
proposal recently submitted by Phlx.\11\
---------------------------------------------------------------------------

    \11\ See supra, note 5.
---------------------------------------------------------------------------

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

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

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

    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) of the Act \12\ and Rule 19b-
4(f)(6) thereunder.\13\
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    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 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) \14\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\15\ 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 upon filing, to coincide with the effective date 
of Phlx's proposed rule change on which the proposal is partially 
based.\16\ The Exchange's proposal would clarify ambiguous rule text 
and would conform the Exchange's rules relating to the permitted number 
of SPY LEAPS expiration months to those of Phlx. Accordingly, the 
Commission believes that the proposal raises no new or novel regulatory 
issues, and waiver of the 30-day operative delay is consistent with the 
protection of investors and the public interest. The Commission 
therefore waives the 30-day operative delay and designates the proposal 
operative upon filing.\17\
---------------------------------------------------------------------------

    \14\ Id.
    \15\ 17 CFR 240.19b-4(f)(6)(iii).
    \16\ See supra, note 5.
    \17\ 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 necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act.

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 rule-comments@sec.gov. Please include 
File Number SR-BOX-2018-35 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-BOX-2018-35. 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

[[Page 59431]]

business days between the hours of 10 a.m. and 3 p.m. Copies of the 
filing also will be available for inspection and copying at the 
principal office of the Exchange. All comments received will be posted 
without change. Persons submitting comments are cautioned that we do 
not redact or edit personal identifying information from comment 
submissions. You should submit only information that you wish to make 
available publicly. All submissions should refer to File Number SR-BOX-
2018-35 and should be submitted on or before December 14, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-25469 Filed 11-21-18; 8:45 am]
BILLING CODE 8011-01-P



                                                                          Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices                                                      59429

                                              investors, or otherwise in furtherance of                 For the Commission, by the Division of              prepared summaries, set forth in
                                              the purposes of the Act.                                Trading and Markets, pursuant to delegated            Sections A, B, and C below, of the most
                                                                                                      authority.16                                          significant aspects of such statements.
                                              IV. Solicitation of Comments                            Eduardo A. Aleman,
                                                                                                      Assistant Secretary.
                                                                                                                                                            A. Self-Regulatory Organization’s
                                                Interested persons are invited to                                                                           Statement of the Purpose of, and
                                              submit written data, views and                          [FR Doc. 2018–25468 Filed 11–21–18; 8:45 am]
                                                                                                                                                            Statutory Basis for, the Proposed Rule
                                              arguments concerning the foregoing,                     BILLING CODE 8011–01–P
                                                                                                                                                            Change
                                              including whether the proposed rule
                                              change is consistent with the Act.                                                                            1. Purpose
                                              Comments may be submitted by any of                     SECURITIES AND EXCHANGE
                                                                                                                                                               The Exchange proposes to amend
                                              the following methods:                                  COMMISSION
                                                                                                                                                            BOX Rule 5070 (Long-term Options
                                              Electronic Comments                                     [Release No. 34–84612; File No. SR–BOX–               Contracts) to permit up to ten (10) long-
                                                                                                      2018–35]                                              term options (‘‘LEAPS’’) expiration
                                                • Use the Commission’s internet                                                                             months for options on SPY.3 BOX Rule
                                              comment form (http://www.sec.gov/                       Self-Regulatory Organizations; BOX                    5070 currently provides that the
                                              rules/sro.shtml); or                                    Exchange LLC; Notice of Filing and                    Exchange may list LEAPS that expire
                                                • Send an email to rule-comments@                     Immediate Effectiveness of Proposed                   from twelve (12) to one hundred eighty
                                              sec.gov. Please include File Number SR–                 Rule Change To Permit Up to Ten                       (180) months from the time they are
                                              NSCC–2018–010 on the subject line.                      Expiration Months for Long-Term                       listed; and there may be up to six (6)
                                                                                                      Options on the SPDR® S&P® 500                         expiration months.4 The Exchange
                                              Paper Comments                                          Exchange-Traded Fund Shares (‘‘SPY’’)                 believes the proposal will add liquidity
                                                • Send paper comments in triplicate                   November 16, 2018.                                    to the SPY options market by allowing
                                              to Secretary, Securities and Exchange                      Pursuant to Section 19(b)(1) of the                market participants to hedge risks
                                              Commission, 100 F Street NE,                            Securities Exchange Act of 1934                       relating to SPY positions over a longer
                                              Washington, DC 20549.                                   (‘‘Act’’),1 and Rule 19b–4 thereunder,2               time period with a known and limited
                                                                                                      notice is hereby given that on November               cost. This is a filing that is based on a
                                              All submissions should refer to File
                                                                                                      16, 2018, BOX Exchange LLC                            proposal recently submitted by Nasdaq
                                              Number SR–NSCC–2018–010. This file
                                                                                                      (‘‘Exchange’’) filed with the Securities              PHLX LLC (‘‘Phlx’’).5
                                              number should be included on the
                                                                                                      and Exchange Commission                                  The SPY options market today is
                                              subject line if email is used. To help the
                                                                                                      (‘‘Commission’’) the proposed rule                    characterized by its tremendous daily
                                              Commission process and review your
                                                                                                      change as described in Items I and II                 and annual liquidity. As a consequence,
                                              comments more efficiently, please use
                                                                                                      below, which Items have been prepared                 the Exchange believes that the listing of
                                              only one method. The Commission will
                                                                                                      by the self-regulatory organization. The              additional SPY LEAPS expiration
                                              post all comments on the Commission’s
                                                                                                      Commission is publishing this notice to               months would be well received by
                                              internet website (http://www.sec.gov/
                                                                                                      solicit comments on the proposed rule                 investors. This proposal to expand the
                                              rules/sro.shtml). Copies of the
                                                                                                      from interested persons.                              number of permitted SPY long-term
                                              submission, all subsequent
                                                                                                                                                            expiration months would not apply to
                                              amendments, all written statements                      I. Self-Regulatory Organization’s                     LEAPS on any other class of stock or
                                              with respect to the proposed rule                       Statement of the Terms of Substance of                Exchange-Traded Fund Shares.6
                                              change that are filed with the                          the Proposed Rule Change
                                              Commission, and all written                                                                                      Finally, BOX Rule 5070(a) currently
                                              communications relating to the                            The Exchange proposes to amend                      states that there may be ‘‘up to six (6)
                                              proposed rule change between the                        BOX Rule 5070 (Long-term Options                      additional expiration months.’’ Because
                                              Commission and any person, other than                   Contracts) to permit up to ten (10)                   the rule does not specify which
                                              those that may be withheld from the                     expiration months for long-term options               expiration months the six months are in
                                              public in accordance with the                           on SPY. The text of the proposed rule                 addition to, and thus is ambiguous, the
                                              provisions of 5 U.S.C. 552, will be                     change is available from the principal                Exchange proposes to delete the word
                                              available for website viewing and                       office of the Exchange, at the                        ‘‘additional.’’ As amended, the rule
                                              printing in the Commission’s Public                     Commission’s Public Reference Room                    would clearly and simply provide that
                                              Reference Room, 100 F Street NE,                        and also on the Exchange’s internet                   the Exchange may list six expiration
                                              Washington, DC 20549 on official                        website at http://boxoptions.com.                     months having from twelve (12) to one
                                              business days between the hours of                      II. Self-Regulatory Organization’s                       3 In contrast to Rule 5070, Exchange Rule
                                              10:00 a.m. and 3:00 p.m. Copies of the                  Statement of the Purpose of, and                      6090(b)(1)(i), which applies to index options,
                                              filing also will be available for                       Statutory Basis for, the Proposed Rule                permits the Exchange to list LEAPS on any class of
                                              inspection and copying at the principal                 Change                                                index options, adding up to ten expiration months.
                                              office of NSCC and on DTCC’s website                                                                          The Exchange seeks to list ten expiration months
                                                                                                        In its filing with the Commission, the              of LEAPS on SPY, just as it now may list ten LEAPS
                                              (http://dtcc.com/legal/sec-rule-
                                                                                                      self-regulatory organization included                 expiration months on index options, in order to
                                              filings.aspx). All comments received                                                                          provide investors with a wider choice of
                                                                                                      statements concerning the purpose of,
                                              will be posted without change. Persons                                                                        investments.
                                                                                                      and basis for, the proposed rule change
                                              submitting comments are cautioned that                                                                           4 Strike price interval, bid/ask differential and
                                                                                                      and discussed any comments it received                continuity rules shall not apply to such options
                                              we do not redact or edit personal
                                                                                                      on the proposed rule change. The text
amozie on DSK3GDR082PROD with NOTICES1




                                                                                                                                                            series until the time to expiration is less than nine
                                              identifying information from comment
                                                                                                      of these statements may be examined at                (9) months. See BOX Rule 5070(a).
                                              submissions. You should submit only                                                                              5 See Securities Exchange Act Release No. 34–
                                                                                                      the places specified in Item IV below.
                                              information that you wish to make                                                                             84449 (October 18, 2018), 83 FR 53699 (SR–Phlx–
                                                                                                      The self-regulatory organization has
                                              available publicly. All submissions                                                                           2018–64).
                                                                                                                                                               6 Historically, SPY is the largest and most actively
                                              should refer to File Number SR–NSCC–                      16 17 CFR 200.30–3(a)(12).                          traded ETF in the United States as measured by its
                                              2018–010 and should be submitted on                       1 15 U.S.C. 78s(b)(1).                              assets under management and the value of shares
                                              or before December 14, 2018.                              2 17 CFR 240.19b–4.                                 traded.



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                                              59430                       Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices

                                              hundred eighty (180) months from the                    merely provides investors additional                      regulatory issues, and waiver of the 30-
                                              time they are listed until expiration.7                 investment and risk management                            day operative delay is consistent with
                                                                                                      opportunities by providing flexibility to                 the protection of investors and the
                                              2. Statutory Basis
                                                                                                      the Exchange to list additional long term                 public interest. The Commission
                                                 The Exchange believes that the                       options expiration series, expanding the                  therefore waives the 30-day operative
                                              proposal is consistent with the                         number of SPY LEAPS offered on the                        delay and designates the proposal
                                              requirements of Section 6(b) of the                     Exchange from six expiration months to                    operative upon filing.17
                                              Securities Exchange Act of 1934 (the                    ten expiration months. As indicated                          At any time within 60 days of the
                                              ‘‘Act’’),8 in general, and Section 6(b)(5)              above, the Exchange notes that this                       filing of the proposed rule change, the
                                              of the Act,9 in particular, in that it is               filing is based on a proposal recently                    Commission summarily may
                                              designed to promote just and equitable                  submitted by Phlx.11                                      temporarily suspend such rule change if
                                              principles of trade, to remove                                                                                    it appears to the Commission that such
                                              impediments to and perfect the                          C. Self-Regulatory Organization’s                         action is necessary or appropriate in the
                                              mechanism of a free and open market                     Statement on Comments on the                              public interest, for the protection of
                                              and a national market system, and, in                   Proposed Rule Change Received From                        investors, or otherwise in furtherance of
                                              general to protect investors and the                    Members, Participants, or Others                          the purposes of the Act.
                                              public interest by offering market                        The Exchange has neither solicited
                                              participants additional LEAPS on SPY                    nor received comments on the proposed                     IV. Solicitation of Comments
                                              options for their investment and risk                   rule change.                                                Interested persons are invited to
                                              management purposes. The proposal is                                                                              submit written data, views, and
                                                                                                      III. Date of Effectiveness of the                         arguments concerning the foregoing,
                                              intended simply to provide additional
                                                                                                      Proposed Rule Change and Timing for                       including whether the proposed rule
                                              trading opportunities, thereby
                                                                                                      Commission Action                                         change is consistent with the Act.
                                              facilitating transactions in options and
                                              contributing to the protection of                          Because the foregoing proposed rule                    Comments may be submitted by any of
                                              investors and the maintenance of fair                   change does not: (i) Significantly affect                 the following methods:
                                              and orderly markets.10 The proposed                     the protection of investors or the public
                                                                                                      interest; (ii) impose any significant                     Electronic Comments
                                              rule change seeks to fulfill the needs of
                                              market participants, particularly                       burden on competition; and (iii) become                     • Use the Commission’s internet
                                              portfolio managers and other                            operative for 30 days from the date on                    comment form (http://www.sec.gov/
                                              institutional customers, by providing                   which it was filed, or such shorter time                  rules/sro.shtml); or
                                              protection from long-term market moves                  as the Commission may designate, it has                     • Send an email to rule-comments@
                                              and by offering an alternative to hedging               become effective pursuant to Section                      sec.gov. Please include File Number SR–
                                              portfolios with futures positions or off-               19(b)(3)(A) of the Act 12 and Rule 19b–                   BOX–2018–35 on the subject line.
                                              exchange customized derivatives                         4(f)(6) thereunder.13                                     Paper Comments
                                              instruments.                                               A proposed rule change filed under
                                                 The Exchange believes that additional                Rule 19b–4(f)(6) 14 normally does not                       • Send paper comments in triplicate
                                              expiration months for SPY LEAPS does                    become operative prior to 30 days after                   to Secretary, Securities and Exchange
                                              not represent a proliferation of                        the date of the filing. However, pursuant                 Commission, 100 F Street NE,
                                              expiration months, but is instead a very                to Rule 19b–4(f)(6)(iii),15 the                           Washington, DC 20549–1090.
                                              modest expansion of LEAPS options.                      Commission may designate a shorter                        All submissions should refer to File
                                              Significantly, the proposal would                       time if such action is consistent with the                Number SR–BOX–2018–35. This file
                                              feature new LEAPS expiration months                     protection of investors and the public                    number should be included on the
                                              in only a single class of options that are              interest. The Exchange has asked the                      subject line if email is used. To help the
                                              very liquid and heavily traded, as                      Commission to waive the 30-day                            Commission process and review your
                                              discussed above. Additionally, the                      operative delay so that the proposal may                  comments more efficiently, please use
                                              Exchange notes by way of precedent                      become operative upon filing, to                          only one method. The Commission will
                                              that ten expiration months are already                  coincide with the effective date of                       post all comments on the Commission’s
                                              permitted for index LEAPS options.                      Phlx’s proposed rule change on which                      internet website (http://www.sec.gov/
                                              Further, the Exchange has the necessary                 the proposal is partially based.16 The                    rules/sro.shtml). Copies of the
                                              systems capacity to support the new                     Exchange’s proposal would clarify                         submission, all subsequent
                                              SPY expiration months.                                  ambiguous rule text and would conform                     amendments, all written statements
                                                                                                      the Exchange’s rules relating to the                      with respect to the proposed rule
                                              B. Self-Regulatory Organization’s                                                                                 change that are filed with the
                                              Statement on Burden on Competition                      permitted number of SPY LEAPS
                                                                                                      expiration months to those of Phlx.                       Commission, and all written
                                                The Exchange does not believe that                    Accordingly, the Commission believes                      communications relating to the
                                              the proposed rule change will impose                    that the proposal raises no new or novel                  proposed rule change between the
                                              any burden on competition not                                                                                     Commission and any person, other than
                                              necessary or appropriate in furtherance                   11 See   supra, note 5.                                 those that may be withheld from the
                                              of the purposes of the Act. The proposal                  12 15   U.S.C. 78s(b)(3)(A).                            public in accordance with the
                                                                                                         13 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–      provisions of 5 U.S.C. 552, will be
                                                7 The Exchange notes other exchanges have             4(f)(6)(iii) requires a self-regulatory organization to   available for website viewing and
                                              amended their rulebook to also clarify this             give the Commission written notice of its intent to
                                                                                                                                                                printing in the Commission’s Public
amozie on DSK3GDR082PROD with NOTICES1




                                              language. See Securities Exchange Act Release No.       file the proposed rule change, along with a brief
                                              34–80769 (May 25, 2017), 82 FR 25472 (SR–Phlx–          description and text of the proposed rule change,         Reference Room, 100 F Street NE,
                                              2017–41).                                               at least five business days prior to the date of filing   Washington, DC 20549, on official
                                                8 15 U.S.C. 78f(b).                                   of the proposed rule change, or such shorter time
                                                9 15 U.S.C. 78f(b)(5).                                as designated by the Commission. The Exchange                17 For purposes only of waiving the 30-day
                                                10 As previously mentioned, the Exchange notes        has satisfied this requirement.                           operative delay, the Commission has also
                                                                                                         14 Id.
                                              that this filing is based on a proposal recently                                                                  considered the proposed rule’s impact on
                                                                                                         15 17 CFR 240.19b–4(f)(6)(iii).
                                              submitted by Phlx, in which Phlx states the reason                                                                efficiency, competition, and capital formation. See
                                              for filing is, in part, customer demand.                   16 See supra, note 5.                                  15 U.S.C. 78c(f).



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                                                                            Federal Register / Vol. 83, No. 226 / Friday, November 23, 2018 / Notices                                                   59431

                                              business days between the hours of 10                     regulators. Further, the information                  Commission and any registered national
                                              a.m. and 3 p.m. Copies of the filing also                 provided on Form Funding Portal                       securities association of which it
                                              will be available for inspection and                      expands the amount of publicly                        becomes a member.1
                                              copying at the principal office of the                    available information about funding                     Rule 403(a) requires a funding portal
                                              Exchange. All comments received will                      portals, including disciplinary history.              to implement written policies and
                                              be posted without change. Persons                         Consequently, the rules and forms                     procedures reasonably designed to
                                              submitting comments are cautioned that                    allows issuers and the investing public,              achieve compliance with the federal
                                              we do not redact or edit personal                         as well as others, to become more fully               securities laws and the rules and
                                              identifying information from comment                      informed about funding portals in a                   regulations thereunder relating to its
                                              submissions. You should submit only                       more efficient manner.                                business as a funding portal. Rule 403(b)
                                              information that you wish to make                            Rule 400 requires each person                      provides that a funding portal must
                                              available publicly. All submissions                       applying for registration with the                    comply with privacy rules. Rule 404
                                              should refer to File Number SR–BOX–                       Commission as a funding portal to file                requires all registered funding portals to
                                              2018–35 and should be submitted on or                     electronically with the Commission                    maintain certain books and records
                                              before December 14, 2018.                                 Form Funding Portal. Rule 400(a)                      relating to their funding portal
                                                For the Commission, by the Division of                  requires a funding portal to become a                 activities, for not less than five years,
                                              Trading and Markets, pursuant to delegated                member of a national securities                       the first two in an easily accessible
                                              authority.18                                              association registered under Section                  place. Rule 404(e) requires funding
                                              Eduardo A. Aleman,                                        15A of the Exchange Act. Rule 400(b)                  portals to furnish promptly to the
                                              Assistant Secretary.                                      requires a funding portal to file an                  Commission, its representatives, and the
                                              [FR Doc. 2018–25469 Filed 11–21–18; 8:45 am]
                                                                                                        amendment to Form Funding Portal if                   registered national securities association
                                                                                                        any information previously submitted                  of which the funding portal is a member
                                              BILLING CODE 8011–01–P
                                                                                                        on Form Funding Portal becomes                        true, correct, complete and current
                                                                                                        inaccurate for any reason. Rule 400(c)                copies of such records of the funding
                                              SECURITIES AND EXCHANGE                                   provides that a funding portal can                    portal that are requested by the
                                              COMMISSION                                                succeed to the business of a predecessor              representatives of the Commission and
                                                                                                        funding portal upon the successor filing              the registered national securities
                                              Proposed Collection; Comment                              a registration on Form Funding Portal                 association.
                                              Request                                                   and the predecessor filing a withdrawal                 The Commission staff estimates that
                                                                                                        on Form Funding Portal.                               annualized industry burden would be
                                              Upon Written Request, Copies Available                       Rule 400(d) requires a funding portal              17,554.35 hours to comply with Rules
                                               From: Securities and Exchange                            to promptly file a withdrawal of                      400–404. The Commission staff
                                               Commission, Office of FOIA Services,                     registration on Form Funding Portal                   estimates that the costs associated with
                                               100 F Street NE, Washington, DC                          upon ceasing to operate as a funding                  complying with Rules 400–404 are
                                               20549–2736                                               portal. Rule 400(e) states that duplicate             estimated to be approximately a total
                                              Extension:                                                originals of the applications and reports             amount of $308,729.
                                                Rules 400–404 of Regulation                             provided for in this section must be                    Written comments are invited on: (a)
                                                  Crowdfunding (Intermediaries); SEC File               filed with surveillance personnel                     Whether the proposed collection of
                                                  No. 270–774, OMB Control No. 3235–                    designated by any registered national                 information is necessary for the proper
                                                  0727                                                  securities association of which the                   performance of the functions of the
                                                 Notice is hereby given that pursuant                   funding portal is a member. Rule 400(f)               Commission, including whether the
                                              to the Paperwork Reduction Act of 1995                    requires a nonresident funding portal to:             information shall have practical utility;
                                              (‘‘PRA’’) (44 U.S.C. 3501 et seq.), the                   (1) Obtain a written consent and power                (b) the accuracy of the Commission’s
                                              Securities and Exchange Commission                        of attorney appointing an agent for                   estimates of the burden of the proposed
                                              (‘‘Commission’’) is soliciting comments                   service of process in the United States;              collection of information; (c) ways to
                                              on the collection of information                          (2) furnish the Commission with the                   enhance the quality, utility, and clarity
                                              provided for Rule 17Ab2–1 (17 CFR                         name and address of its agent for                     of the information to be collected; and
                                              240.17Ab2–1) and Form CA–1:                               services of process on Schedule C of                  (d) ways to minimize the burden of the
                                              Registration of Clearing Agencies (17                     Form Funding Portal; (3) certify that it              collection of information on
                                              CFR 249b.200) under the Securities                        can, as a matter of law, and will provide             respondents, including through the use
                                              Exchange Act of 1934 (‘‘Exchange Act’’)                   the Commission and any registered                     of automated collection techniques or
                                              (15 U.S.C. 78a et seq.). The Commission                   national securities association of which              other forms of information technology.
                                              plans to submit this existing collection                  it becomes a member with prompt                       Consideration will be given to
                                              of information to the Office of                           access to its books and records and can,              comments and suggestions submitted in
                                              Management and Budget (‘‘OMB’’) for                       as a matter of law, and will submit to                writing within 60 days of this
                                              extension and approval.                                   onsite inspection and examination by                  publication.
                                                 The collections of information                         the Commission and any registered                       An agency may not conduct or
                                              required under Rules 400 through 404 is                   national securities association of which              sponsor, and a person is not required to
                                              mandatory for all funding portals. Form                   it becomes a member; and (4) provide                  respond to, a collection of information
                                              Funding Portal helps ensure that the                      the Commission with an opinion of                     under the PRA unless it displays a
                                              Commission can make information                           counsel and certify on Schedule C on                  currently valid OMB control number.
                                              about funding portals transparent and                     Form Funding Portal that the firm can,                  Please direct your written comments
amozie on DSK3GDR082PROD with NOTICES1




                                              easily accessible to the investing public,                as a matter of law, provide the                       to: Charles Riddle, Acting Director/Chief
                                              including issuers and obligated persons                   Commission and registered national                    Information Officer, Securities and
                                              who engage funding portals; investors                     securities association of which it
                                                                                                                                                                1 Exchange Act Section 3(h)(1)(C) permits us to
                                              who may purchase securities through                       becomes a member with prompt access
                                                                                                                                                              impose, as part of our authority to exempt funding
                                              offerings on funding portals; and other                   to its books and records and can, as a                portals from broker registration, ‘‘such other
                                                                                                        matter of law, submit to onsite                       requirements under [the Exchange Act] as the
                                                18 17   CFR 200.30–3(a)(12).                            inspection and examination by the                     Commission determines appropriate.’’



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Document Created: 2018-11-27 12:58:23
Document Modified: 2018-11-27 12:58:23
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 59429 

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