Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend a Pilot Program that Eliminates Position and Exercise Limits for Physically-Settled SPDR S&P 500 ETF Trust (“SPY”) Options, 42011-42013 [2016-15179]
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Federal Register / Vol. 81, No. 124 / Tuesday, June 28, 2016 / Notices
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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
BX–2016–030 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BX–2016–030. 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 Web site (https://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 Web site 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 such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–BX–
2016–030, and should be submitted on
or before July 19, 2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.10
Brent J. Fields,
Secretary.
[FR Doc. 2016–15175 Filed 6–27–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
change pursuant to Section
19(b)(3)(A)(iii) of the Act 3 and Rule
19b–4(f)(6) thereunder.4 The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
The Exchange proposes to extend the
operation of a pilot program that
eliminates position and exercise limits
for physically-settled SPY options
(‘‘SPY Pilot Program’’). The text of the
proposed rule change is provided
below.
(additions are italicized; deletions are
[bracketed])
*
*
*
*
*
[Release No. 34–78131; File No. SR–CBOE–
2016–052]
Chicago Board Options Exchange,
Incorporated Rules
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Extend a Pilot
Program that Eliminates Position and
Exercise Limits for Physically-Settled
SPDR S&P 500 ETF Trust (‘‘SPY’’)
Options
*
June 22, 2016.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on June 20,
2016, Chicago Board Options Exchange,
Incorporated (the ‘‘Exchange’’ or
‘‘CBOE’’) filed with the Securities and
Exchange Commission (‘‘Commission’’)
the proposed rule change as described
in Items I and II below, which Items
have been prepared by the Exchange.
The Exchange filed the proposal as a
‘‘non-controversial’’ proposed rule
*
*
*
No changes.
. . . Interpretations and Policies:
.01–.06 No change.
.07 The position limits under Rule
4.11 applicable to options on shares or
other securities that represent interests
in registered investment companies (or
series thereof) organized as open-end
management investment companies,
unit investment trusts or similar entities
that satisfy the criteria set forth in
Interpretation and Policy .06 under Rule
5.3 shall be the same as the position
limits applicable to equity options
under Rule 4.11 and Interpretations and
Policies thereunder; except that the
position limits under Rule 4.11
applicable to option contracts on the
securities listed in the below chart are
as follows:
Security underlying option
asabaliauskas on DSK3SPTVN1PROD with NOTICES
The
The
The
The
The
Position limit
DIAMONDS Trust (DIA) .........................................................................................................................................
Standard and Poor’s Depositary Receipt Trust (SPY) ...........................................................................................
iShares Russell 2000 Index Fund (IWM) ...............................................................................................................
PowerShares QQQ Trust (QQQ) ...........................................................................................................................
iShares MSCI Emerging Markets Index Fund (EEM) ............................................................................................
Position limits for SPY options are
subject to a pilot program through [July
12, 2016] July 12, 2017.
.08 No change.
*
*
*
*
*
The text of the proposed rule change
is also available on the Exchange’s Web
site (https://www.cboe.com/AboutCBOE/
CBOELegalRegulatoryHome.aspx), at
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
the Exchange’s Office of the Secretary,
and at the Commission’s Public
Reference Room.
10 17
2 17
1 15
3 15
VerDate Sep<11>2014
17:49 Jun 27, 2016
Jkt 238001
PO 00000
CFR 240.19b–4.
U.S.C. 78s(b)(3)(A)(iii).
Frm 00084
Fmt 4703
*
Rule 4.11. Position Limits
Sfmt 4703
300,000
None.
500,000
900,000
500,000
contracts.
contracts.
contracts.
contracts.
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
4 17
E:\FR\FM\28JNN1.SGM
CFR 240.19b–4(f)(6).
28JNN1
42012
Federal Register / Vol. 81, No. 124 / Tuesday, June 28, 2016 / Notices
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.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
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
Interpretation and Policy .07 to Rule
4.11 (Position Limits) to extend the
duration of the SPY Pilot Program.5 The
SPY Pilot Program is currently
scheduled to expire on July 12, 2016
and this proposal would extend the SPY
Pilot Program through July 12, 2017.
There are no substantive changes being
proposed to the SPY Pilot Program.
In proposing to extend the SPY Pilot
Program, the Exchange reaffirms its
consideration of several factors that
supported its original proposal to
establish the SPY Pilot Program, which
include: (1) The liquidity of the option
and the underlying security; (2) the
market capitalization of the underlying
security and the securities that make up
the S&P 500 Index; (3) options reporting
requirements; and (4) financial
requirements imposed by CBOE and the
Commission. When the SPY Pilot
Program was most recently renewed in
July 2015, CBOE submitted a report
providing an analysis of the SPY Pilot
Program during the period January 2014
through May 2015 (the ‘‘Pilot Report’’).
In the July 2015 extension, the Exchange
stated that if it were to submit a
proposal to either extend the SPY Pilot
Program, adopt the SPY Pilot Program
on a permanent basis, or terminate the
SPY Pilot Program, it would submit
another Pilot Report covering the period
since the previous extension.6
Accordingly, the Exchange is submitting
another Pilot Report that details CBOE’s
experience with the SPY Pilot Program.
The Pilot Report now includes the
period of June 2015 through April 2016.
The Pilot Report is attached as Exhibit
3. CBOE notes that it is unaware of any
problems created by the SPY Pilot
Program and does not foresee any as a
result of the proposed extension. In
extending the SPY Pilot Program, the
5 See Securities Exchange Act Release Nos. 67937
(September 27, 2012), 77 FR 60489 (October 3,
2012) (SR–CBOE–2012–091); 70878 (November 14,
2013), 78 FR 69737 (November 20, 2013) (SR–
CBOE–2013–106); 74149 (January 27, 2015) 80 FR
5606 (February 2, 2015) (SR–CBOE–2015–008); and
75381 (July 7, 2015) 80 FR 40111 (July 13, 2015)
(SR–CBOE–2015–065).
6 See 80 FR at 40112.
VerDate Sep<11>2014
17:49 Jun 27, 2016
Jkt 238001
Exchange states that if CBOE were to
propose another extension, permanent
approval or termination of the SPY Pilot
Program, the Exchange will submit
another Pilot Report covering the period
since the previous extension, which will
be submitted at least 30 days before the
end of the proposed extension. If the
SPY Pilot Program is not extended or
adopted on a permanent basis by July
12, 2017, position limits in SPY will
revert to their Pre-Pilot levels.
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the Act
and the rules and regulations
thereunder applicable to the Exchange
and, in particular, the requirements of
Section 6(b) of the Act.7 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 8 requirements that the rules of
an exchange be designed to prevent
fraudulent and manipulative acts and
practices, 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. Specifically, the
Exchange believes that extending the
SPY Pilot Program promotes just and
equitable principles of trade by
permitting market participants,
including market makers, institutional
investors and retail investors, to
establish greater positions when
pursuing their investment goals and
needs. Extending the SPY Pilot Program
will give the Exchange and the
Commission additional time to evaluate
the pilot and its effect on the market.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
proposed rule change is not designed to
address any aspect of competition,
whether between the Exchange and its
competitors, or among market
participants. Instead, the proposed rule
change is designed to allow the SPY
Pilot Program to continue as the
Exchange expects other SROs will
propose similar extensions.
7 15
8 15
PO 00000
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
Frm 00085
Fmt 4703
Sfmt 4703
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange 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 and Rule 19b–
4(f)(6) thereunder.9
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 10 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b–4(f)(6)(iii) 11
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, noting that such waiver
will allow the Exchange to extend the
pilot program prior to its expiration on
July 12, 2016. In addition, the Exchange
believes that waiver of the operative
delay is consistent with the protection
of investors and the public interest
because it will allow for the least
amount of market disruption as the pilot
will continue as it currently does
maintaining the status quo. The
Commission believes that waiving the
30-day operative delay is consistent
with the protection of investors and the
public interest. Therefore, the
Commission hereby waives the
operative delay and designates the
proposed rule change operative upon
filing.12
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
9 17 CFR 240.19b–4(f)(6). As required under Rule
19b–4(f)(6)(iii), the Exchange provided the
Commission with 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.
10 17 CFR 240.19b–4(f)(6).
11 17 CFR 240.19b–4(f)(6)(iii).
12 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
E:\FR\FM\28JNN1.SGM
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Federal Register / Vol. 81, No. 124 / Tuesday, June 28, 2016 / Notices
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.
IV. Solicitation of Comments
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
CBOE–2016–052 on the subject line.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–CBOE–2016–052. 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 Web site (https://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 Web site 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 such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–CBOE–
17:49 Jun 27, 2016
Jkt 238001
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Brent J. Fields,
Secretary.
[FR Doc. 2016–15179 Filed 6–27–16; 8:45 am]
BILLING CODE 8011–01–P
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:
VerDate Sep<11>2014
2016–052, and should be submitted on
or before July 19, 2016.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–78122; File No. SRBatsBYX–2016–12]
Self-Regulatory Organizations; Bats
BYX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change Related to Fees
June 22, 2016.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on June 8,
2016, Bats BYX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘BYX’’) 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 Exchange has
designated the proposed rule change as
one establishing or changing a member
due, fee, or other charge imposed by the
Exchange under Section 19(b)(3)(A)(ii)
of the Act 3 and Rule 19b–4(f)(2)
thereunder,4 which renders the
proposed rule change effective upon
filing with the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange filed a proposal to
amend the fee schedule applicable to
Members 5 and non-members of the
Exchange pursuant to BYX Rules 15.1(a)
and (c) (‘‘Fee Schedule’’) to: (i) Add fee
codes NA and NB; (ii) reduce the rebate
for fee codes BB, N, and W; (iii) add
Add Volume Tier 2 under footnote 1;
and (iv) add Remove Volume Tier under
footnote 1.
The text of the proposed rule change
is available at the Exchange’s Web site
13 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(ii).
4 17 CFR 240.19b–4(f)(2).
5 The term ‘‘Member’’ is defined as ‘‘any
registered broker or dealer that has been admitted
to membership in the Exchange.’’ See Exchange
Rule 1.5(n).
1 15
PO 00000
Frm 00086
Fmt 4703
Sfmt 4703
42013
at www.batstrading.com, at the
principal office of the Exchange, and at
the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in Sections A, B, and C below, of
the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend its
Fee Schedule to: (i) Add fee codes NA
and NB; (ii) reduce the rebate for fee
codes BB, N, and W; (iii) add Add
Volume Tier 2 under footnote 1; and (iv)
add Remove Volume Tier under
footnote 1.
Fee Codes NA and NB
The Exchange previously filed a
proposed rule change with the
Commission to identify Non-Displayed
Orders 6 as such when routed to an
away Trading Center.7 The Exchange
intends to implement this functionality
on June 1, 2016.8 Because other Trading
Centers typically provide different
rebates or fees with respect to nondisplayed liquidity the Exchange
proposes to amend its Fee Schedule to
add fee codes NA and NB, which would
apply to routed Non-Displayed Orders.
Proposed fee code NA would be applied
to Non-Displayed Orders that are routed
to and add liquidity on Bats EDGX
Exchange, Inc. (‘‘EDGX’’), Bats BZX
Exchange, Inc. (‘‘BZX’’), the New York
6 See
Exchange Rule 11.9(c)(11).
Exchange notes that the Exchange also
amended its rules to route Reserve Orders (as
defined in Rule 11.9(c)(1)) as such to other Trading
Centers. See Securities Exchange Act 77187
(February 19, 2016), 81 FR 9556 (February 25, 2016)
(SR–BYX–2016–04). Non-Displayed Orders and
Reserve Orders would be handled in accordance
with the rules of the Trading Center to which they
are routed. Id. This proposal does not impact the
routing of Reserve Orders.
8 See Bats Announces Support for Hidden Postto-Away Routed Orders,available at https://
cdn.batstrading.com/resources/release_notes/2016/
Bats-Announces-Support-for-Hidden-Post-to-AwayRouted-Orders.pdf.
7 The
E:\FR\FM\28JNN1.SGM
28JNN1
]]>Agencies
[Federal Register Volume 81, Number 124 (Tuesday, June 28, 2016)]
[Notices]
[Pages 42011-42013]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-15179]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-78131; File No. SR-CBOE-2016-052]
Self-Regulatory Organizations; Chicago Board Options Exchange,
Incorporated; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Extend a Pilot Program that Eliminates Position
and Exercise Limits for Physically-Settled SPDR S&P 500 ETF Trust
(``SPY'') Options
June 22, 2016.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on June 20, 2016, Chicago Board Options Exchange, Incorporated
(the ``Exchange'' or ``CBOE'') filed with the Securities and Exchange
Commission (``Commission'') the proposed rule change as described in
Items I and II below, which Items have been prepared by the Exchange.
The Exchange filed the proposal as a ``non-controversial'' proposed
rule change pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and
Rule 19b-4(f)(6) thereunder.\4\ The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
The Exchange proposes to extend the operation of a pilot program
that eliminates position and exercise limits for physically-settled SPY
options (``SPY Pilot Program''). The text of the proposed rule change
is provided below.
(additions are italicized; deletions are [bracketed])
* * * * *
Chicago Board Options Exchange, Incorporated Rules
* * * * *
Rule 4.11. Position Limits
No changes.
. . . Interpretations and Policies:
.01-.06 No change.
.07 The position limits under Rule 4.11 applicable to options on
shares or other securities that represent interests in registered
investment companies (or series thereof) organized as open-end
management investment companies, unit investment trusts or similar
entities that satisfy the criteria set forth in Interpretation and
Policy .06 under Rule 5.3 shall be the same as the position limits
applicable to equity options under Rule 4.11 and Interpretations and
Policies thereunder; except that the position limits under Rule 4.11
applicable to option contracts on the securities listed in the below
chart are as follows:
------------------------------------------------------------------------
Security underlying option Position limit
------------------------------------------------------------------------
The DIAMONDS Trust (DIA)........................ 300,000 contracts.
The Standard and Poor's Depositary Receipt Trust None.
(SPY).
The iShares Russell 2000 Index Fund (IWM)....... 500,000 contracts.
The PowerShares QQQ Trust (QQQ)................. 900,000 contracts.
The iShares MSCI Emerging Markets Index Fund 500,000 contracts.
(EEM).
------------------------------------------------------------------------
Position limits for SPY options are subject to a pilot program
through [July 12, 2016] July 12, 2017.
.08 No change.
* * * * *
The text of the proposed rule change is also available on the
Exchange's Web site (https://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the
Secretary, 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
[[Page 42012]]
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
The Exchange proposes to amend Interpretation and Policy .07 to
Rule 4.11 (Position Limits) to extend the duration of the SPY Pilot
Program.\5\ The SPY Pilot Program is currently scheduled to expire on
July 12, 2016 and this proposal would extend the SPY Pilot Program
through July 12, 2017. There are no substantive changes being proposed
to the SPY Pilot Program.
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release Nos. 67937 (September
27, 2012), 77 FR 60489 (October 3, 2012) (SR-CBOE-2012-091); 70878
(November 14, 2013), 78 FR 69737 (November 20, 2013) (SR-CBOE-2013-
106); 74149 (January 27, 2015) 80 FR 5606 (February 2, 2015) (SR-
CBOE-2015-008); and 75381 (July 7, 2015) 80 FR 40111 (July 13, 2015)
(SR-CBOE-2015-065).
---------------------------------------------------------------------------
In proposing to extend the SPY Pilot Program, the Exchange
reaffirms its consideration of several factors that supported its
original proposal to establish the SPY Pilot Program, which include:
(1) The liquidity of the option and the underlying security; (2) the
market capitalization of the underlying security and the securities
that make up the S&P 500 Index; (3) options reporting requirements; and
(4) financial requirements imposed by CBOE and the Commission. When the
SPY Pilot Program was most recently renewed in July 2015, CBOE
submitted a report providing an analysis of the SPY Pilot Program
during the period January 2014 through May 2015 (the ``Pilot Report'').
In the July 2015 extension, the Exchange stated that if it were to
submit a proposal to either extend the SPY Pilot Program, adopt the SPY
Pilot Program on a permanent basis, or terminate the SPY Pilot Program,
it would submit another Pilot Report covering the period since the
previous extension.\6\ Accordingly, the Exchange is submitting another
Pilot Report that details CBOE's experience with the SPY Pilot Program.
The Pilot Report now includes the period of June 2015 through April
2016. The Pilot Report is attached as Exhibit 3. CBOE notes that it is
unaware of any problems created by the SPY Pilot Program and does not
foresee any as a result of the proposed extension. In extending the SPY
Pilot Program, the Exchange states that if CBOE were to propose another
extension, permanent approval or termination of the SPY Pilot Program,
the Exchange will submit another Pilot Report covering the period since
the previous extension, which will be submitted at least 30 days before
the end of the proposed extension. If the SPY Pilot Program is not
extended or adopted on a permanent basis by July 12, 2017, position
limits in SPY will revert to their Pre-Pilot levels.
---------------------------------------------------------------------------
\6\ See 80 FR at 40112.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\7\ Specifically, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \8\ requirements that the rules of
an exchange be designed to prevent fraudulent and manipulative acts and
practices, 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. Specifically, the Exchange believes that extending the
SPY Pilot Program promotes just and equitable principles of trade by
permitting market participants, including market makers, institutional
investors and retail investors, to establish greater positions when
pursuing their investment goals and needs. Extending the SPY Pilot
Program will give the Exchange and the Commission additional time to
evaluate the pilot and its effect on the market.
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\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The proposed rule change is
not designed to address any aspect of competition, whether between the
Exchange and its competitors, or among market participants. Instead,
the proposed rule change is designed to allow the SPY Pilot Program to
continue as the Exchange expects other SROs will propose similar
extensions.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange 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 and Rule 19b-
4(f)(6) thereunder.\9\
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\9\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with 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.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \10\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \11\ 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, noting
that such waiver will allow the Exchange to extend the pilot program
prior to its expiration on July 12, 2016. In addition, the Exchange
believes that waiver of the operative delay is consistent with the
protection of investors and the public interest because it will allow
for the least amount of market disruption as the pilot will continue as
it currently does maintaining the status quo. The Commission believes
that waiving the 30-day operative delay is consistent with the
protection of investors and the public interest. Therefore, the
Commission hereby waives the operative delay and designates the
proposed rule change operative upon filing.\12\
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\10\ 17 CFR 240.19b-4(f)(6).
\11\ 17 CFR 240.19b-4(f)(6)(iii).
\12\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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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
[[Page 42013]]
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.
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 (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-CBOE-2016-052 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-CBOE-2016-052. 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 Web site (https://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 Web site 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 such filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-CBOE-2016-052, and should be
submitted on or before July 19, 2016.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2016-15179 Filed 6-27-16; 8:45 am]
BILLING CODE 8011-01-P
