83 FR 63926 - Self-Regulatory Organizations; Nasdaq MRX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Bid/Ask Differentials
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 238 (December 12, 2018)
Federal Register Volume 83, Issue 238 (December 12, 2018)
| Page Range | 63926-63929 | |
| FR Document | 2018-26825 |
[Federal Register Volume 83, Number 238 (Wednesday, December 12, 2018)] [Notices] [Pages 63926-63929] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-26825] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-84728; File No. SR-MRX-2018-36] Self-Regulatory Organizations; Nasdaq MRX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Bid/Ask Differentials December 6, 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 28, 2018, Nasdaq MRX, LLC (``MRX'' or ``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 Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend MRX Rule 701, entitled ``Opening,'' MRX Rule 803, entitled ``Obligations of Market Makers'' and MRX Rule 100, entitled ``Definitions.'' The text of the proposed rule change is available on the Exchange's website at http://nasdaqmrx.cchwallstreet.com/, at the principal office of the Exchange, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose MRX proposes several amendments in this rule change. First, the Exchange proposes to amend MRX Rule 701, entitled ``Opening'' and MRX Rule 803, entitled ``Obligations of Market Makers'' to correct inconsistencies between the Exchange's rule text and the operation of the System. Second, the Exchange proposes to add definitions to MRX Rule 100 to define ``in-the-money'' and ``out-of-the-money'' options series. Third, the Exchange proposes to correct various cross references to Rule 100. Each amendment will be described in more detail below. Rules 701 and 803 Today, for the Opening Process, MRX Rule 701(a)(8) defines a ``Valid Width Quote'' as a two-sided electronic quotation submitted by a Market Maker that consists of a bid/ask differential that is compliant with Rule 803(b)(4).\3\ Specifically, for the Opening Process, MRX Rule 803(b)(4) states that, for in- [[Page 63927]] the-money option series, the bid/ask differential may be as wide as the spread between the national best bid and offer in the underlying security. In practice, however, the Exchange's System permits a Valid Width Quote in the Opening Process to be as wide as the quotation for the underlying security on the primary (listing) market.\4\ --------------------------------------------------------------------------- \3\ MRX Rule 803(b)(4) provides: ``To price options contracts fairly by, among other things, bidding and offering so as to create differences of no more than $5 between the bid and offer following the opening rotation in an equity or index options contract. Prior to the opening rotation, spread differentials shall be no more than $.25 between the bid and offer for each options contract for which the bid is less than $2, no more than $.40 where the bid is at least $2 but does not exceed $5, no more than $.50 where the bid is more than $5 but does not exceed $10, no more than $.80 where the bid is more than $10 but does not exceed $20, and no more than $1 where the bid is $20 or greater, provided that the Exchange may establish differences other than the above for one or more options series. (i) The bid/offer differentials stated in subparagraph (b)(4) of this Rule shall not apply to in-the-money options series where the underlying securities market is wider than the differentials set forth above. For these series, the bid/ask differential may be as wide as the spread between the national best bid and offer in the underlying security.'' \4\ In connection with the MRX migration, the primary market was utilized beginning on August 14, 2017 as each symbol migrated to the INET platform. --------------------------------------------------------------------------- Proposal The Exchange proposes to codify its current practice and correctly reflect in its Rules that the Valid Width Quote in the Opening Process apply a primary market analysis, not a national best bid or offer (``NBBO'') analysis.\5\ Specifically, this proposal would conform the current rule text to the current System by amending the definition of a Valid Width Quote in Rule 701, ``Opening,'' so that, in the case of in- the-money option series \6\ where the market for the underlying security is wider than the differentials set forth within MRX Rule 803(b)(4), the bid/ask differential may be as wide as the quotation for the underlying security on the primary \7\ (listing) market, or its decimal equivalent rounded down to the nearest minimum increment. --------------------------------------------------------------------------- \5\ The Exchange notes that today MRX utilizes the primary market in calculating the bid/ask differential during the Opening Process. This rule change would amend the rule to reflect MRX's current practice. \6\ An at-the-money option series would also qualify. An out-of- the-money series would not qualify. \7\ The term ``primary market'' means the principal market in which an underlying security is traded. See MRX Rule 100(a)(51). --------------------------------------------------------------------------- The Exchange believes that utilizing the primary market in the Opening Process is reasonable given the close connection between the primary market and the Opening Process. For example, MRX Rule 701(c)(2) provides, ``For all options, the underlying security, including indexes, must be open on the primary market for a certain time period as determined by the Exchange for the Opening Process to commence. The time period shall be no less than 100 milliseconds and no more than 5 seconds.'' Today, in order to open, the Exchange requires either: (i) The Primary Market Maker's (``PMM'') Valid Width Quote; (ii) the Valid Width Quotes of at least two Competitive Market Makers (``CMM''); or (iii) if neither the PMM's Valid Width Quote nor the Valid Width Quotes of two CMMs have been submitted within such timeframe, one CMM has submitted a Valid Width Quote. The Exchange notes that it requires Market Makers to submit Valid Width Quotes during the Opening Process to guarantee liquidity, unlike other markets which may not require market makers to quote during the opening.\8\ Further, amending the rule text to conform to its current practice will avoid confusion and continue to permit MRX to remain one of the strongest openings in the industry. --------------------------------------------------------------------------- \8\ The Nasdaq Options Market (``NOM'') does not require NOM Market Makers to quote during the opening, however if a NOM Market Maker decided to quote during the opening, the Market Maker would be permitted to submit a bid/ask differential with a difference not to exceed $5 between the bid and offer regardless of the price of the bid. However, respecting in-the-money series where the market for the underlying security is wider than $5, the bid/ask differential may be as wide as the spread between the national best bid and offer in the underlying security. See NOM Rules at Chapter VII, Section 6(d)(ii). --------------------------------------------------------------------------- Discretion The Exchange proposes to codify its current practice and amend MRX Rule 803(b)(4) to adopt rule text which permits the Exchange intra-day discretion for bid/ask differentials similar to the discretion currently permitted in the Opening Process. The Exchange proposes to add a sentence to the end of the paragraph in MRX Rule 803(b)(4) indicating the Exchange may establish differences other than the above for one or more series or classes of options. The Exchange notes that it utilizes this discretion today to grant relief for individual options classes as well as relief for all option classes based upon specific criteria. Today, Market Makers may request quote relief. When determining whether to grant quote relief the Exchange considers, among other factors, the following: (i) Pending corporate actions with undisclosed or uncertain terms; (ii) company or industry news with anticipated significant market impact; (iii) government news of a sensational nature. The Exchange believes that it is necessary to grant quote relief in certain circumstances where a Market Maker may not have enough information to maintain fair and orderly markets. The Exchange notes that other markets have similar discretion for intra-day quotes today.\9\ --------------------------------------------------------------------------- \9\ See Nasdaq Phlx LLC Rule 1014(c)(i)(A)(1)(a), Miami International Securities Exchange LLC Rule 604b)(4), Cboe Exchange, Inc. Rule 8.7(d), NYSE American LLC Rule 925NY(b)(4), NYSE Arca, Inc. 6.37-O(b)(4). --------------------------------------------------------------------------- Rule 100 MRX rules currently do not define an ``in-the-money'' or ``out-of- the-money'' option series. As part of this rule change, the Exchange proposes to define these above-referenced terms within MRX Rule 100 to bring greater transparency to its rules with respect to Market Maker quoting. The Exchange proposes to define the term ``in-the-money'' at Rule 100(a)(28), which is currently reserved, as the following: For call options, all strike prices at or below the offer in the underlying security on the primary listing market; for put options, all strike prices at or above the bid in the underlying security on the primary listing market. The Exchange proposes to define the term ``out-of-the- money'' option at Rule 100(a)(41), which is currently reserved, to mean the following: For call options, all strike prices above the offer in the underlying security on the primary listing market; for put options, all strike prices below the bid in the underlying security on the primary listing market.\10\ Each of these definitions would apply for purposes of Market Maker quoting obligations in Rules 701 and 803. The Exchange notes that it specifically proposes to reference the rules related to Market Maker quoting obligations to avoid any confusion with the manner in which ``in-the-money'' and ``out-of-the-money'' options series are defined for purposes of other options rules. --------------------------------------------------------------------------- \10\ The Exchange notes that it does not utilize a last sale calculation. The Exchange believes that the quotation for the underlying security on the primary market provides an accurate reflection of the market. A last sale calculation may not be an accurate reflection of the market because the last sale may not be representative of the primary market in all cases, particularly if a halt were to occur. --------------------------------------------------------------------------- The Exchange has added these definitions into the existing rules in alphabetical order. The Exchange proposes to renumber the rules to account for the addition of these two new definitions and proposes to amend cross-references to Rule 100 within the Rulebook to reflect the proposed new numbering within Rule 100. Cross References The Exchange proposes to amend cross-references to Rule 100 in Rules 713 and 720 to refer to the current definitions. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\11\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\12\ 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 [[Page 63928]] investors and the public interest. The Exchange notes that today MRX utilizes the primary market in calculating the bid/ask differential during the Opening Process, although the current rule does not reflect this practice. This rule change would amend the rule to reflect MRX's current practice. --------------------------------------------------------------------------- \11\ 15 U.S.C. 78f(b). \12\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- Rules 701 and 803 The Exchange's proposal to amend the Opening Process to conform to current practice is consistent with the Act because while the Exchange believes that relying on the primary market or the NBBO accurately reflect the current trading environment and take into consideration market conditions, the Exchange's current Opening Process is designed to utilize the primary standard during the Opening Process.\13\ --------------------------------------------------------------------------- \13\ MRX Rule 701(c)(2) provides, ``For all options, the underlying security, including indexes, must be open on the primary market for a certain time period as determined by the Exchange for the Opening Process to commence. The time period shall be no less than 100 milliseconds and no more than 5 seconds.'' --------------------------------------------------------------------------- Discretion The Exchange's proposal to amend its rule to permit intra-day discretion to conform to current practice is consistent with the Act because such discretion is necessary to permit the Exchange the ability to attract liquidity from Market Makers while also maintaining a fair and orderly market. Market Makers accept a certain amount of risk when quoting on the Exchange. The Exchange imposes quoting and other obligations on Market Makers.\14\ The Exchange notes that these risks which Market Makers accept each trading day are calculated risks. The Exchange notes that it considers certain factors, which are likely unforeseen, in determining whether to grant relief either in individual options classes or for all option classes based upon specific criteria. Specifically, the Exchange considers, among other factors, the following: (i) Pending corporate actions with undisclosed or uncertain terms; (ii) company or industry news with anticipated significant market impact; (iii) government news of a sensational nature. The Exchange believes that it is necessary to grant quote relief in certain circumstances where a Market Maker may not have enough information to maintain fair and orderly markets. The Exchange notes that other markets have similar discretion for intra-day quotes today.\15\ --------------------------------------------------------------------------- \14\ See MRX Rules 803 and 804. \15\ See note 9 above. --------------------------------------------------------------------------- Rule 100 The Exchange's proposal to define the terms ``in-the-money'' and ``out-of-the-money'' for purposes of Market Maker quoting obligations in Rules 701 and 803 is consistent with the Act and protects investors and the public interest by bringing greater transparency to the Rulebook. Each of these defined terms would apply for purposes of Market Maker quoting obligations in Rules 701 and 803. The Exchange notes that it specifically proposes to reference the rules related to Market Maker quoting obligations to avoid any confusion with the manner in which ``in-the-money'' and ``out-of-the-money'' options series are defined for purposes of other options rules. Cross-References The Exchange's proposal to amend cross-references to Rule 100 within Rules 713, 720 and Rule 1901 to refer to the current definitions is consistent with the Act because it will correct references to definitions. 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. Rules 701 and 803 The Exchange's proposal to codify its current practice of utilizing the primary market in the Opening Process does not unduly burden competition because the current practice maintains a close connection between the primary market and the Opening Process. The primary market reflects the current trading environment. The Exchange notes that the proposal does not create an undue burden on intra-market competition because Market Makers are the only market participants subject to quoting requirements and these participants have valuable information with respect to the underlying instrument under the current process to make informed decisions and take calculated risks in the marketplace when providing liquidity. Market Makers remain responsible for maintaining fair and orderly markets. Discretion The Exchange's proposal to codify the Exchange's ability to permit intra-day discretion similar to the discretion currently permitted in the Opening Process does not impose an undue burden on competition because Market Makers are the only market participants subject to quoting requirements and the proposal specifically considers the need for Market Makers to have information to make informed decisions to make calculated risks in the marketplace so that they may provide liquidity while maintaining fair and orderly markets. The proposed amendments do not create an undue burden on inter-market competition because other options markets have the same intra-day requirements.\16\ --------------------------------------------------------------------------- \16\ Id. --------------------------------------------------------------------------- Rule 100 The Exchange's proposal to define the terms ``in-the-money'' or ``out-of-the-money'' for purposes of Market Maker quoting obligations in Rules 701 and 803 does not unduly burden competition, rather it adds greater transparency to the Rulebook and makes clear the applicability of the definitions to avoid confusion with respect to the remainder of the options rules. Cross-References The Exchange's proposal to amend cross-references to Rule 100 in Rules 713, 720 and Rule 1901 to refer to the current definitions does not unduly burden competition because it will correct references to definitions. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act\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 the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this 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 [[Page 63929]] 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 proposal may become operative immediately upon filing. The Exchange states that immediately codifying its current practice within its rules to accurately reflect the operation of the Exchange's System will avoid confusion. The Commission believes that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest. Accordingly, the Commission hereby waives the 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 CommentsUse the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-MRX-2018-36 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-MRX-2018-36. 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-MRX-2018-36 and should be submitted on or before January 2, 2019. 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. 2018-26825 Filed 12-11-18; 8:45 am] BILLING CODE 8011-01-P
![63926 Federal Register / Vol. 83, No. 238 / Wednesday, December 12, 2018 / Notices
public interest and hereby waives the filing also will be available for II. Self-Regulatory Organization’s
30-day operative delay and designates inspection and copying at the principal Statement of the Purpose of, and
the proposed rule change to be operative office of the Exchange. All comments Statutory Basis for, the Proposed Rule
upon filing.14 received will be posted without change. Change
At any time within 60 days of the Persons submitting comments are In its filing with the Commission, the
filing of the proposed rule change, the cautioned that we do not redact or edit Exchange included statements
Commission summarily may personal identifying information from concerning the purpose of and basis for
temporarily suspend such rule change if comment submissions. You should the proposed rule change and discussed
it appears to the Commission that such submit only information that you wish
action is necessary or appropriate in the any comments it received on the
to make available publicly. All proposed rule change. The text of these
public interest, for the protection of submissions should refer to File
investors, or otherwise in furtherance of statements may be examined at the
Number SR–NYSEAMER–2018–53 and places specified in Item IV below. The
the purposes of the Act. should be submitted on or before Exchange has prepared summaries, set
IV. Solicitation of Comments January 2, 2019. forth in sections A, B, and C below, of
Interested persons are invited to For the Commission, by the Division of the most significant aspects of such
submit written data, views, and Trading and Markets, pursuant to delegated statements.
authority.15
arguments concerning the foregoing, A. Self-Regulatory Organization’s
including whether the proposed rule Eduardo A. Aleman,
Assistant Secretary.
Statement of the Purpose of, and
change is consistent with the Act. Statutory Basis for, the Proposed Rule
Comments may be submitted by any of [FR Doc. 2018–26837 Filed 12–11–18; 8:45 am]
Change
the following methods: BILLING CODE 8011–01–P
1. Purpose
Electronic Comments
MRX proposes several amendments in
• Use the Commission’s internet SECURITIES AND EXCHANGE
this rule change. First, the Exchange
comment form (http://www.sec.gov/ COMMISSION
proposes to amend MRX Rule 701,
rules/sro.shtml); or
entitled ‘‘Opening’’ and MRX Rule 803,
• Send an email to rule-comments@ [Release No. 34–84728; File No. SR–MRX–
sec.gov. Please include File Number SR– 2018–36] entitled ‘‘Obligations of Market Makers’’
NYSEAMER–2018–53 on the subject to correct inconsistencies between the
Self-Regulatory Organizations; Nasdaq Exchange’s rule text and the operation
line.
MRX, LLC; Notice of Filing and of the System. Second, the Exchange
Paper Comments Immediate Effectiveness of Proposed proposes to add definitions to MRX
• Send paper comments in triplicate Rule Change Relating to Bid/Ask Rule 100 to define ‘‘in-the-money’’ and
to Secretary, Securities and Exchange Differentials ‘‘out-of-the-money’’ options series.
Commission, 100 F Street NE, Third, the Exchange proposes to correct
December 6, 2018.
Washington, DC 20549–1090. various cross references to Rule 100.
Pursuant to Section 19(b)(1) of the Each amendment will be described in
All submissions should refer to File Securities Exchange Act of 1934
Number SR–NYSEAMER–2018–53. This more detail below.
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
file number should be included on the notice is hereby given that on November Rules 701 and 803
subject line if email is used. To help the 28, 2018, Nasdaq MRX, LLC (‘‘MRX’’ or
Commission process and review your Today, for the Opening Process, MRX
‘‘Exchange’’) filed with the Securities Rule 701(a)(8) defines a ‘‘Valid Width
comments more efficiently, please use and Exchange Commission
only one method. The Commission will Quote’’ as a two-sided electronic
(‘‘Commission’’) the proposed rule quotation submitted by a Market Maker
post all comments on the Commission’s change as described in Items I and II
internet website (http://www.sec.gov/ that consists of a bid/ask differential
below, which Items have been prepared that is compliant with Rule 803(b)(4).3
rules/sro.shtml). Copies of the by the Exchange. The Commission is
submission, all subsequent Specifically, for the Opening Process,
publishing this notice to solicit MRX Rule 803(b)(4) states that, for in-
amendments, all written statements comments on the proposed rule change
with respect to the proposed rule from interested persons. 3 MRX Rule 803(b)(4) provides:
change that are filed with the ‘‘To price options contracts fairly by, among other
Commission, and all written I. Self-Regulatory Organization’s things, bidding and offering so as to create
communications relating to the Statement of the Terms of Substance of differences of no more than $5 between the bid and
proposed rule change between the the Proposed Rule Change offer following the opening rotation in an equity or
index options contract. Prior to the opening
Commission and any person, other than The Exchange proposes to amend rotation, spread differentials shall be no more than
those that may be withheld from the MRX Rule 701, entitled ‘‘Opening,’’ $.25 between the bid and offer for each options
public in accordance with the MRX Rule 803, entitled ‘‘Obligations of contract for which the bid is less than $2, no more
provisions of 5 U.S.C. 552, will be than $.40 where the bid is at least $2 but does not
Market Makers’’ and MRX Rule 100, exceed $5, no more than $.50 where the bid is more
available for website viewing and entitled ‘‘Definitions.’’ than $5 but does not exceed $10, no more than $.80
printing in the Commission’s Public The text of the proposed rule change where the bid is more than $10 but does not exceed
Reference Room, 100 F Street NE, is available on the Exchange’s website at $20, and no more than $1 where the bid is $20 or
Washington, DC 20549 on official greater, provided that the Exchange may establish
http://nasdaqmrx.cchwallstreet.com/, at
amozie on DSK3GDR082PROD with NOTICES1
differences other than the above for one or more
business days between the hours of the principal office of the Exchange, and options series.
10:00 a.m. and 3:00 p.m. Copies of the at the Commission’s Public Reference (i) The bid/offer differentials stated in
Room. subparagraph (b)(4) of this Rule shall not apply to
14 For purposes only of waiving the 30-day in-the-money options series where the underlying
operative delay, the Commission has also securities market is wider than the differentials set
15 17 CFR 200.30–3(a)(12).
considered the proposed rule’s impact on forth above. For these series, the bid/ask differential
1 15 U.S.C. 78s(b)(1).
efficiency, competition, and capital formation. See may be as wide as the spread between the national
15 U.S.C. 78c(f). 2 17 CFR 240.19b–4. best bid and offer in the underlying security.’’
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![Federal Register / Vol. 83, No. 238 / Wednesday, December 12, 2018 / Notices 63929
19b–4(f)(6)(iii) 20 permits the only one method. The Commission will Summary of Application: Applicants
Commission to designate a shorter time post all comments on the Commission’s request an order to permit certain
if such action is consistent with the internet website (http://www.sec.gov/ registered closed-end management
protection of investors and the public rules/sro.shtml). Copies of the investment companies to issue multiple
interest. The Exchange has asked the submission, all subsequent classes of shares and to impose asset-
Commission to waive the 30-day amendments, all written statements based distribution and/or service fees,
operative delay so that the proposal may with respect to the proposed rule early withdrawal charges (‘‘EWCs’’) and
become operative immediately upon change that are filed with the early repurchase fees.
filing. The Exchange states that Commission, and all written Applicants: Cliffwater Corporate
immediately codifying its current communications relating to the Lending Fund (the ‘‘Initial Fund’’) and
practice within its rules to accurately proposed rule change between the Cliffwater LLC (the ‘‘Adviser’’).
reflect the operation of the Exchange’s Commission and any person, other than Filing Dates: The application was
System will avoid confusion. The those that may be withheld from the filed on April 27, 2018, and amended on
Commission believes that waiver of the public in accordance with the September 28, 2018.
30-day operative delay is consistent provisions of 5 U.S.C. 552, will be Hearing or Notification of Hearing: An
with the protection of investors and the available for website viewing and order granting the requested relief will
public interest. Accordingly, the printing in the Commission’s Public be issued unless the Commission orders
Commission hereby waives the Reference Room, 100 F Street NE, a hearing. Interested persons may
operative delay and designates the Washington, DC 20549, on official request a hearing by writing to the
proposed rule change as operative upon business days between the hours of Commission’s Secretary and serving
filing.21 10:00 a.m. and 3:00 p.m. Copies of the applicants with a copy of the request,
At any time within 60 days of the filing also will be available for personally or by mail.
filing of the proposed rule change, the Hearing requests should be received
inspection and copying at the principal
Commission summarily may by the Commission by 5:30 p.m. on
office of the Exchange. All comments
temporarily suspend such rule change if December 31, 2018, and should be
received will be posted without change.
it appears to the Commission that such accompanied by proof of service on the
Persons submitting comments are
action is: (i) Necessary or appropriate in applicants, in the form of an affidavit,
cautioned that we do not redact or edit
the public interest; (ii) for the protection or, for lawyers, a certificate of service.
personal identifying information from Pursuant to rule 0–5 under the Act,
of investors; or (iii) otherwise in comment submissions. You should
furtherance of the purposes of the Act. hearing requests should state the nature
submit only information that you wish of the writer’s interest, any facts bearing
If the Commission takes such action, the to make available publicly. All
Commission shall institute proceedings upon the desirability of a hearing on the
submissions should refer to File matter, the reason for the request, and
to determine whether the proposed rule Number SR–MRX–2018–36 and should
should be approved or disapproved. the issues contested. Persons who wish
be submitted on or before January 2, to be notified of a hearing may request
IV. Solicitation of Comments 2019. notification by writing to the
Interested persons are invited to For the Commission, by the Division of Commission’s Secretary.
submit written data, views, and Trading and Markets, pursuant to delegated ADDRESSES: Secretary, U.S. Securities
authority.22 and Exchange Commission, 100 F Street
arguments concerning the foregoing,
including whether the proposed rule Eduardo A. Aleman, NE, Washington, DC 20549–1090;
change is consistent with the Act. Assistant Secretary. Applicants: 4640 Admiralty Way, 11th
Comments may be submitted by any of [FR Doc. 2018–26825 Filed 12–11–18; 8:45 am] Floor, Marina del Rey, CA 90292.
the following methods: BILLING CODE 8011–01–P FOR FURTHER INFORMATION CONTACT:
Electronic Comments Bruce R. MacNeil, Senior Counsel, at
(202) 551–6817, or Kaitlin C. Bottock,
• Use the Commission’s internet SECURITIES AND EXCHANGE Branch Chief, at (202) 551–6825
comment form (http://www.sec.gov/ COMMISSION (Division of Investment Management,
rules/sro.shtml); or Chief Counsel’s Office).
• Send an email to rule-comments@ [Investment Company Act Release No.
SUPPLEMENTARY INFORMATION: The
sec.gov. Please include File Number SR– 33318; 812–14902]
following is a summary of the
MRX–2018–36 on the subject line. Cliffwater Corporate Lending Fund and application. The complete application
Paper Comments Cliffwater LLC may be obtained via the Commission’s
• Send paper comments in triplicate website by searching for the file
December 6, 2018. number, or for an applicant using the
to Secretary, Securities and Exchange AGENCY: Securities and Exchange Company name box, at http://
Commission, 100 F Street NE, Commission (‘‘Commission’’). www.sec.gov/search/search.htm or by
Washington, DC 20549–1090.
ACTION: Notice. calling (202) 551–8090.
All submissions should refer to File
Number SR–MRX–2018–36. This file Notice of an application under section Applicants’ Representations
number should be included on the 6(c) of the Investment Company Act of 1. The Initial Fund is a Delaware
subject line if email is used. To help the 1940 (the ‘‘Act’’) for an exemption from statutory trust that is registered under
Commission process and review your sections 18(a)(2), 18(c) and 18(i) of the the Act as a non-diversified, closed-end
amozie on DSK3GDR082PROD with NOTICES1
comments more efficiently, please use Act, under sections 6(c) and 23(c) of the management investment company. The
Act for an exemption from rule 23c–3 Initial Fund’s primary investment
20 17 CFR 240.19b–4(f)(6)(iii). under the Act, and for an order pursuant objective is to seek consistent current
21 For purposes only of waiving the 30-day to section 17(d) of the Act and rule 17d– income. Capital preservation will be
operative delay, the Commission has also
considered the proposed rule’s impact on 1 under the Act. considered a secondary objective.
efficiency, competition, and capital formation. See 2. The Adviser, a Delaware limited
15 U.S.C. 78c(f). 22 17 CFR 200.30–3(a)(12). liability company, is registered as an
VerDate Sep<11>2014 18:39 Dec 11, 2018 Jkt 247001 PO 00000 Frm 00105 Fmt 4703 Sfmt 4703 E:\FR\FM\12DEN1.SGM 12DEN1](https://thefederalregister.org/doc/83_FR_64164/page/4.svg)
Document Created: 2018-12-12 01:39:13
Document Modified: 2018-12-12 01:39:13
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 83 FR 63926 |
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