83 FR 63939 - Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Defined Terms “In-the-Money” and “Out-of-the-Money” in Chapter I, Section 1
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 238 (December 12, 2018)
Federal Register Volume 83, Issue 238 (December 12, 2018)
| Page Range | 63939-63941 | |
| FR Document | 2018-26914 |
[Federal Register Volume 83, Number 238 (Wednesday, December 12, 2018)] [Notices] [Pages 63939-63941] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-26914] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-84752; File No. SR-NASDAQ-2018-100] Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Defined Terms ``In-the-Money'' and ``Out-of-the-Money'' in Chapter I, Section 1 December 7, 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 30, 2018, The Nasdaq Stock Market LLC (``Nasdaq'' or ``Exchange'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I, II, and III, 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. --------------------------------------------------------------------------- [[Page 63940]] I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend The Nasdaq Options Market LLC (``NOM'') Rules at Chapter I, Section 1, specifically the defined terms ``in-the-money'' and ``out-of-the-money'' at NOM Rules at Chapter I, Section 1(a)(67) and (68), respectively. The text of the proposed rule change is available on the Exchange's website at http://nasdaq.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 NOM rules define an ``in-the-money'' option series at Chapter I, Section 1(a)(67). Currently the term ``in-the-money'' means, for call options, all strike prices below the offer in the underlying security on the primary listing market; for put options, all strike prices above the bid in the underlying security on the primary listing market. NOM rules define an ``out-of-the-money'' option series at Chapter I, Section 1(a)(68). Currently, the term ``out-of-the-money'' shall 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. The Exchange proposes to amend these defined terms as specified below. In-the-Money At this time, the Exchange proposes to amend the defined term ``in- the-money'' to include an ``at-the-money'' option. The term ``in-the- money'' would be defined with this amendment to mean, 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 believes that amending the term ``in-the-money'' to include options that are ``at-the-money'' will bring greater transparency to the manner in which the Exchange handles ``at-the- money'' options.\3\ --------------------------------------------------------------------------- \3\ The Exchange notes that the inclusion of the term ``at-the- money'' within the defined term ``in-the-money'' represents the Exchange's current practice. --------------------------------------------------------------------------- In-the-Money and Out-of-the-Money The Exchange proposes to limit the defined terms ``in-the-money'' and ``out-of-the-money'' option series for purposes of Market Maker quoting obligations in Chapter VII, Section 6. 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. This limitation represents current practice. The Exchange also notes that it is conforming this term across its Nasdaq affiliated markets. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\4\ in general, and furthers the objectives of Section 6(b)(5) of the Act,\5\ 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. The Exchange's proposal to amend the defined term ``in-the-money'' to include options that are ``at-the-money'' will bring greater transparency to the current manner in which the Exchange handles ``at- the-money'' options. --------------------------------------------------------------------------- \4\ 15 U.S.C. 78f(b). \5\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange's proposal to note that the defined terms ``in-the- money'' and ``out-of-the-money'' would apply for purposes of Market Maker quoting obligations in Chapter VII, Section 6 would 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. The limitation of the defined terms for purposes of Market Maker quoting obligations in Chapter VII, Section 6 will bring transparency to the current use of the defined terms. 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 Exchange's proposal to amend the defined term ``in-the-money'' to include options that are ``at-the-money'' and add limitations to the use of the defined terms ``in-the-money'' and ``out-of-the-money'' for purposes of Market Maker quoting obligations in Chapter VII, Section 6 do not unduly burden competition, rather these amendments add 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. 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 \6\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\7\ --------------------------------------------------------------------------- \6\ 15 U.S.C. 78s(b)(3)(A)(iii). \7\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) requires a self-regulatory organization to give the Commission written notice of its intent to file 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. --------------------------------------------------------------------------- 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. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. [[Page 63941]] 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-NASDAQ-2018-100 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-NASDAQ-2018-100. 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-NASDAQ-2018-100 and should be submitted on or before January 2, 2019. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\8\ --------------------------------------------------------------------------- \8\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-26914 Filed 12-11-18; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 83, No. 238 / Wednesday, December 12, 2018 / Notices 63939
Rule 1000 filing. The Exchange states that communications relating to the
The Exchange’s proposal to define the immediately codifying its current proposed rule change between the
terms ‘‘in-the-money’’ or ‘‘out-of-the- practice within its rules to accurately Commission and any person, other than
money’’ for purposes of Phlx Electronic reflect the operation of the Exchange’s those that may be withheld from the
Market Maker quoting obligations in System will avoid confusion. The public in accordance with the
Rules 1014 and 1017 does not unduly Commission believes that waiver of the provisions of 5 U.S.C. 552, will be
burden competition, rather it adds 30-day operative delay is consistent available for website viewing and
greater transparency to the Rulebook with the protection of investors and the printing in the Commission’s Public
and makes clear the applicability of the public interest. Accordingly, the Reference Room, 100 F Street NE,
definitions to avoid confusion with Commission hereby waives the Washington, DC 20549, on official
respect to the remainder of the options operative delay and designates the business days between the hours of
rules. proposed rule change as operative upon 10:00 a.m. and 3:00 p.m. Copies of the
filing.19 filing also will be available for
Rule 1014 At any time within 60 days of the inspection and copying at the principal
The Exchange’s proposal to codify its filing of the proposed rule change, the office of the Exchange. All comments
current practice of rounding down when Commission summarily may received will be posted without change.
referring to decimal equivalent within temporarily suspend such rule change if Persons submitting comments are
Rule 1014(c)(i)(A)(1)(a) does not impose it appears to the Commission that such cautioned that we do not redact or edit
an unduly burden competition because action is: (i) Necessary or appropriate in personal identifying information from
the Exchange continues to uniformly the public interest; (ii) for the protection comment submissions. You should
apply its rounding methodology with of investors; or (iii) otherwise in submit only information that you wish
respect to its market making furtherance of the purposes of the Act. to make available publicly. All
participants. If the Commission takes such action, the submissions should refer to File
Commission shall institute proceedings Number SR–Phlx–2018–77 and should
C. Self-Regulatory Organization’s to determine whether the proposed rule
Statement on Comments on the be submitted on or before January 2,
should be approved or disapproved. 2019.
Proposed Rule Change Received From
Members, Participants, or Others IV. Solicitation of Comments For the Commission, by the Division of
Interested persons are invited to Trading and Markets, pursuant to delegated
No written comments were either authority.20
solicited or received. submit written data, views, and
arguments concerning the foregoing, Eduardo A. Aleman,
III. Date of Effectiveness of the including whether the proposed rule Assistant Secretary.
Proposed Rule Change and Timing for change is consistent with the Act. [FR Doc. 2018–26824 Filed 12–11–18; 8:45 am]
Commission Action Comments may be submitted by any of BILLING CODE 8011–01–P
Because the foregoing proposed rule the following methods:
change does not: (i) Significantly affect Electronic Comments
the protection of investors or the public SECURITIES AND EXCHANGE
interest; (ii) impose any significant • Use the Commission’s internet COMMISSION
burden on competition; and (iii) become comment form (http://www.sec.gov/
operative for 30 days from the date on rules/sro.shtml); or [Release No. 34–84752; File No. SR–
which it was filed, or such shorter time • Send an email to rule-comments@ NASDAQ–2018–100]
as the Commission may designate, it has sec.gov. Please include File Number SR–
become effective pursuant to Section Phlx–2018–77 on the subject line. Self-Regulatory Organizations; The
19(b)(3)(A)(iii) of the Act 15 and Paper Comments Nasdaq Stock Market LLC; Notice of
subparagraph (f)(6) of Rule 19b–4 Filing and Immediate Effectiveness of
thereunder.16 • Send paper comments in triplicate Proposed Rule Change To Amend the
A proposed rule change filed under to Secretary, Securities and Exchange Defined Terms ‘‘In-the-Money’’ and
Rule 19b–4(f)(6) 17 normally does not Commission, 100 F Street NE, ‘‘Out-of-the-Money’’ in Chapter I,
become operative prior to 30 days after Washington, DC 20549–1090. Section 1
the date of the filing. However, Rule All submissions should refer to File
19b–4(f)(6)(iii) 18 permits the Number SR–Phlx–2018–77. This file December 7, 2018.
Commission to designate a shorter time number should be included on the Pursuant to Section 19(b)(1) of the
if such action is consistent with the subject line if email is used. To help the Securities Exchange Act of 1934
protection of investors and the public Commission process and review your (‘‘Act’’),1 and Rule 19b–4 thereunder,2
interest. The Exchange has asked the comments more efficiently, please use notice is hereby given that on November
Commission to waive the 30-day only one method. The Commission will 30, 2018, The Nasdaq Stock Market LLC
operative delay so that the proposal may post all comments on the Commission’s (‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the
become operative immediately upon internet website (http://www.sec.gov/ Securities and Exchange Commission
rules/sro.shtml). Copies of the (‘‘Commission’’) the proposed rule
15 15 U.S.C. 78s(b)(3)(A)(iii). submission, all subsequent change as described in Items I, II, and
16 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– amendments, all written statements III, below, which Items have been
4(f)(6)(iii) requires a self-regulatory organization to with respect to the proposed rule prepared by the Exchange. The
amozie on DSK3GDR082PROD with NOTICES1
give the Commission written notice of its intent to
file the proposed rule change, along with a brief change that are filed with the Commission is publishing this notice to
description and the text of the proposed rule Commission, and all written solicit comments on the proposed rule
change, at least five business days prior to the date change from interested persons.
of filing of the proposed rule change, or such 19 For purposes only of waiving the 30-day
shorter time as designated by the Commission. The operative delay, the Commission has also
Exchange has satisfied this requirement. 20 17 CFR 200.30–3(a)(12).
considered the proposed rule’s impact on
17 17 CFR 240.19b–4(f)(6). 1 15 U.S.C. 78s(b)(1).
efficiency, competition, and capital formation. See
18 17 CFR 240.19b–4(f)(6)(iii). 15 U.S.C. 78c(f). 2 17 CFR 240.19b–4.
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![Federal Register / Vol. 83, No. 238 / Wednesday, December 12, 2018 / Notices 63941
IV. Solicitation of Comments For the Commission, by the Division of on the proposed rule change. The text
Trading and Markets, pursuant to delegated of those statements may be examined at
Interested persons are invited to authority.8 the places specified in Item IV below.
submit written data, views, and Eduardo A. Aleman, The Exchange has prepared summaries,
arguments concerning the foregoing, Assistant Secretary. set forth in sections A, B, and C below,
including whether the proposed rule [FR Doc. 2018–26914 Filed 12–11–18; 8:45 am] of the most significant parts of such
change is consistent with the Act. BILLING CODE 8011–01–P statements.
Comments may be submitted by any of
the following methods: A. Self-Regulatory Organization’s
SECURITIES AND EXCHANGE Statement of the Purpose of, and the
Electronic Comments COMMISSION Statutory Basis for, the Proposed Rule
Change
• Use the Commission’s internet [Release No. 34–84733; File No. SR–CHX–
comment form (http://www.sec.gov/ 2018–06] 1. Purpose
rules/sro.shtml); or
Self-Regulatory Organizations; The purpose of the proposed rule
• Send an email to rule-comments@ Chicago Stock Exchange, Inc.; Notice change is to amend CHX Article 22,
sec.gov. Please include File Number SR– of Filing and Immediate Effectiveness Rule 6(a) to remove the requirement that
NASDAQ–2018–100 on the subject line. of Proposed Rule Change To Amend the Exchange file with the Commission
Paper Comments CHX Article 22, Rule 6(a) a Form 19b–4(e) for each ‘‘new
derivative securities product’’ that will
• Send paper comments in triplicate December 6, 2018. commence trading on the Exchange
to Secretary, Securities and Exchange Pursuant to Section 19(b)(1) 1 of the pursuant to unlisted trading privileges.
Commission, 100 F Street NE, Securities Exchange Act of 1934 The Exchange notes that a substantially
Washington, DC 20549–1090. (‘‘Act’’) 2 and Rule 19b–4 thereunder,3 identical proposed rule change by NYSE
notice is hereby given that, on National, Inc. (‘‘NYSE National’’) was
All submissions should refer to File November 27, 2018, the Chicago Stock recently approved by the Commission.4
Number SR–NASDAQ–2018–100. This Exchange, Inc. (‘‘CHX’’ or ‘‘Exchange’’)
file number should be included on the filed with the Securities and Exchange CHX Article 22, Rule 6(a) sets forth
subject line if email is used. To help the Commission (‘‘Commission’’) the the requirement for the Exchange to file
Commission process and review your proposed rule change as described in with the Commission a Form 19b–4(e)
Items I and II below, which Items have with respect to each ‘‘new derivative
comments more efficiently, please use
been prepared by the self-regulatory securities product’’ that is traded
only one method. The Commission will
organization. The Commission is pursuant to unlisted trading privileges.
post all comments on the Commission’s However, the Exchange believes that it
internet website (http://www.sec.gov/ publishing this notice to solicit
comments on the proposed rule change should not be necessary to file a Form
rules/sro.shtml). Copies of the 19b–4(e) with the Commission if it
submission, all subsequent from interested persons.
begins trading a ‘‘new derivative
amendments, all written statements I. Self-Regulatory Organization’s securities product’’ pursuant to unlisted
with respect to the proposed rule Statement of the Terms of Substance of trading privileges, because Rule 19b–
change that are filed with the the Proposed Rule Change 4(e)(1) under the Act refers to the
Commission, and all written The Exchange proposes to amend ‘‘listing and trading’’ of a ‘‘new
communications relating to the CHX Article 22, Rule 6(a) to remove the derivative securities product.’’ The
proposed rule change between the requirement that the Exchange file with Exchange believes that the requirements
Commission and any person, other than the Securities and Exchange of that rule refer to when an exchange
those that may be withheld from the Commission (the ‘‘Commission’’) a lists and trades a ‘‘new derivative
public in accordance with the Form 19b–4(e) for each ‘‘new derivative securities product’’, and not when an
provisions of 5 U.S.C. 552, will be securities product’’ that will commence exchange seeks only to trade such
available for website viewing and trading on the Exchange pursuant to product pursuant to unlisted trading
printing in the Commission’s Public unlisted trading privileges. The privileges pursuant to Rule 12f–2 under
Reference Room, 100 F Street NE, proposed rule change is available on the the Act.5 Therefore, the Exchange
Washington, DC 20549, on official Exchange’s website at www.nyse.com, at proposes to delete the requirement in
business days between the hours of the principal office of the Exchange, and Article 22, Rule 6(a) for the Exchange to
10:00 a.m. and 3:00 p.m. Copies of the at the Commission’s Public Reference file a Form 19b–4(e) with the
filing also will be available for Room. Commission with respect to each ‘‘new
inspection and copying at the principal derivative securities product’’ it begins
II. Self-Regulatory Organization’s trading pursuant to unlisted trading
office of the Exchange. All comments Statement of the Purpose of, and privileges.
received will be posted without change. Statutory Basis for, the Proposed Rule
Persons submitting comments are Change 2. Statutory Basis
cautioned that we do not redact or edit
In its filing with the Commission, the The Exchange believes that the
personal identifying information from
self-regulatory organization included proposed rule change is consistent with
comment submissions. You should
statements concerning the purpose of,
amozie on DSK3GDR082PROD with NOTICES1
submit only information that you wish the provisions of Section 6(b) 6 of the
and basis for, the proposed rule change Act in general, and furthers the
to make available publicly. All and discussed any comments it received
submissions should refer to File 4 See Securities Exchange Act Release No. 83289
Number SR–NASDAQ–2018–100 and 8 17 CFR 200.30–3(a)(12). (May 17, 2018), 83 FR 23968 (May 23, 2018) (Order
should be submitted on or before 1 15 U.S.C.78s(b)(1). Approving File No. SR–NYSENat–2018–02).
January 2, 2019. 2 15 U.S.C. 78a. 5 17 CFR 240.12f-2.
3 17 CFR 240.19b–4. 6 15 U.S.C. 78f(b).
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Document Created: 2018-12-12 01:39:44
Document Modified: 2018-12-12 01:39:44
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 83 FR 63939 |
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