Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend IM-3120-2 to Rule 3120 To Extend the Pilot Program That Eliminated the Position Limits for Options on SPDR S&P 500 ETF (“SPY”) (“SPY Pilot Program”), 32402-32404 [2017-14661]
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sradovich on DSK3GMQ082PROD with NOTICES
32402
Federal Register / Vol. 82, No. 133 / Thursday, July 13, 2017 / Notices
17Ad–22(e)(15)(ii) requires, in part, that
the Clearing Agencies hold LNA funded
by equity equal to the greater of either
(i) six months of the covered clearing
agency’s current operating expenses, or
(ii) the amount determined by the board
of directors to be sufficient to ensure a
recovery or orderly wind-down of
critical operations and services of the
covered clearing agency.44
As described above, pursuant to the
Policy, each Clearing Agency would be
required to calculate and maintain their
respective Total Capital Requirement.
The Total Capital Requirement would
be calculated by summing each Clearing
Agency’s respective General Business
Risk Capital Requirement and Credit
Risk Capital Requirement, and would be
satisfied by LNA funded by equity.
Specifically, as detailed above, the
Policy would provide that the General
Business Risk Capital Requirement
would be calculated as the larger of (i)
an amount calculated based on the
Clearing Agency’s general business risk
profile, defined as its Risk-Based Capital
Requirement; (ii) an amount based on
the time estimated to execute a recovery
or orderly wind-down of the critical
operations of the Clearing Agency,
defined as its Recovery/Wind-down
Capital Requirement; and (iii) an
amount based on an analysis of the
Clearing Agency’s estimated operating
expenses for a six-month period,
defined as its Operating Expense Capital
Requirement.
By requiring each Clearing Agency to
calculate its General Business Risk
Capital Requirement as the larger
amount of the Risk-Based Capital
Requirement, the Recovery/Wind-down
Capital Requirement, and the Operating
Expense Capital Requirement, and by
requiring the General Business Risk
Capital Requirement with LNA funded
by equity, the Commission believes that
the Policy is consistent with Rule
17Ad–22(e)(15)(i) and (ii) under the
Act.45
Rule 17Ad–22(e)(15)(ii) under the Act
further requires, in part, that the LNA
funded by equity held by the Clearing
Agencies pursuant to Rule 17Ad–
22(e)(15)(ii) shall be (A) in addition to
resources held to cover participant
defaults or other credits and liquidity
risks; and (B) of high quality and
sufficiently liquid to allow the Clearing
Agencies to meet their current and
projected operating expenses under a
range of scenarios, including in adverse
market conditions.46
As described above, the Policy would
identify the General Business Risk
Capital Requirement of each Clearing
Agency as a separate component of each
Clearing Agency’s Total Capital
Requirement, and would provide that
LNA funded by equity as General
Business Risk Capital Requirement be in
addition to (i) LNA funded by equity
held as that Clearing Agency’s Credit
Risk Capital Requirement; (ii) resources
held by that Clearing Agency in
compliance with Rule 17Ad–22(e)(4)
under the Act for credit risk (which
resources are also held in addition to
that Clearing Agency’s Credit Risk
Capital Requirement); 47 and (iii)
resources held by that Clearing Agency
in compliance with Rule 17Ad–22(e)(7)
under the Act for liquidity risk.48
Additionally, the Policy would provide
that the Clearing Agencies must meet
their Total Capital Requirement by
holding LNA funded by equity in cash,
highly liquid securities, or bank
deposits, to comply with Rule 17Ad–
22(e)(15)(ii)(B). Moreover, the Policy
would provide that the available LNA
funded by equity would be
continuously monitored and managed to
ensure satisfaction of the Total Capital
Requirement. Therefore, the
Commission believes that adoption of
the Policy is consistent with Rule
17Ad–22(e)(15)(ii)(A) and (B) under the
Act.49
Rule 17Ad–22(e)(15)(iii) requires the
Clearing Agencies to maintain a viable
plan, approved by their Boards, and
updated at least annually, for raising
additional equity should the LNA
funded by equity fall close to or below
the amount required.50 As described
above, the Plan would designate to
Treasury the responsibilities of
monitoring the sufficiency of each
Clearing Agency’s LNA funded by
equity and the triggering events for
implementation of the Plan. The Plan
also would provide tools to raise
additional LNA funded by equity, in the
event that such capital drops near or
below the Total Capital Requirement. In
addition, the Plan would provide that
the respective Boards of the Clearing
Agencies, or such committees as may be
delegated authority by the respective
Boards, would review and approve the
Plan annually. Therefore, the
Commission believes that adoption of
the Plan is consistent with Rule 17Ad–
22(e)(15)(iii) under the Act.51
47 17
CFR 240.17Ad–22(e)(4).
CFR 240.17Ad–22(e)(7).
49 17 CFR 240.17Ad–22(e)(15)(ii)(A), (B).
50 17 CFR 240.17Ad–22(e)(15)(iii).
51 Id.
48 17
44 17
CFR 240.17Ad–22(e)(15)(ii).
CFR 240.17Ad–22(e)(15)(i), (ii).
46 17 CFR 240.17Ad–22(e)(15)(ii)(A), (B).
45 17
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III. Conclusion
On the basis of the foregoing, the
Commission finds that the Proposed
Rule Changes are consistent with the
requirements of the Act and in
particular with the requirements of
Section 17A(b)(3)(F) 52 and the rules and
regulations thereunder.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act, that
proposed rule changes SR–DTC–2017–
003, SR–NSCC–2017–004, and SR–
FICC–2017–007 be, and hereby are,
approved.53
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.54
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–14671 Filed 7–12–17; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–81092; File No. SR–BOX–
2017–22]
Self-Regulatory Organizations; BOX
Options Exchange LLC; Notice of
Filing and Immediate Effectiveness of
a Proposed Rule Change To Amend
IM–3120–2 to Rule 3120 To Extend the
Pilot Program That Eliminated the
Position Limits for Options on SPDR
S&P 500 ETF (‘‘SPY’’) (‘‘SPY Pilot
Program’’)
July 7, 2017.
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 29,
2017, BOX Options Exchange LLC (the
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the self-regulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
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 amend IM–
3120–2 to Rule 3120 to extend the pilot
program that eliminated the position
52 15
U.S.C. 78q–1(b)(3)(F).
approving the Proposed Rule Changes, the
Commission considered the proposals’ impact on
efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
54 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
53 In
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Federal Register / Vol. 82, No. 133 / Thursday, July 13, 2017 / Notices
limits for options on SPDR S&P 500 ETF
(‘‘SPY’’) (‘‘SPY Pilot Program’’). The text
of the proposed rule change is available
from the principal office of the
Exchange, at the Commission’s Public
Reference Room and also on the
Exchange’s Internet Web site at https://
boxexchange.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of these statements may be examined at
the places specified in Item IV below.
The self-regulatory organization has
prepared summaries, set forth in
Sections A, B, and C below, of the most
significant aspects of such statements.
sradovich on DSK3GMQ082PROD 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 IM–
3120–2 to Rule 3120 to extend the time
period of the SPY Pilot Program,3 which
is currently scheduled to expire on July
12, 2017, through July 12, 2018.4
This filing does not propose any
substantive changes to the SPY Pilot
Program. In proposing to extend the
SPY Pilot Program, the Exchange
reaffirms its consideration of several
factors that supported the original
proposal of the SPY Pilot Program,
including (1) the availability of
economically equivalent products and
their respective position limits, (2) the
liquidity of the option and the
underlying security, (3) the market
capitalization of the underlying security
and the related index, (4) the reporting
of large positions and requirements
surrounding margin, and (5) the
potential for market on close volatility.
In the proposal to extend the SPY
Pilot Program, the Exchange stated that
if it were to propose an extension,
permanent approval or termination of
the program, the Exchange would
submit, along with any filing proposing
such amendments to the program, a
report providing an analysis of the SPY
3 See Securities Exchange Act Release No. 67936
(September 27, 2012), 77 FR 60491 (October 3,
2012) (Notice of Filing and Immediate Effectiveness
of SR–BOX–2012–013).
4 See Securities Exchange Act Release No. 78247
(July 7, 2016), 81 FR 45348 (July 13, 2016) (Notice
of Filing and Immediate Effectiveness of SR–BOX–
2016–31).
VerDate Sep<11>2014
17:41 Jul 12, 2017
Jkt 241001
Pilot Program covering the period since
the previous extension (the ‘‘Pilot
Report’’).5 Accordingly, the Exchange is
submitting the Pilot Report detailing the
Exchange’s experience with the SPY
Pilot Program. The Pilot Report is
attached as Exhibit 3 to this filing [sic].
The Exchange 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 it were to
propose another extension, permanent
approval or termination of the 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, 2018, position limits in SPY will
revert to their Pre-Pilot levels.
Extending the SPY Pilot Program will
give the Exchange and Commission
additional time to evaluate the pilot and
its effect on the market.
2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the Act,
in general, and Section 6(b)(5) of the
Act, in particular, in that it is 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. 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.
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
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 without
interruption. Additionally, the
PO 00000
5 Id.
Frm 00088
Fmt 4703
Sfmt 4703
32403
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 has neither solicited
nor received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act and Rule 19b–
4(f)(6) thereunder.6
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 7 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b–4(f)(6)(iii) 8
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 believes that
waiver of the operative delay is
consistent with the protection of
investors and the public interest
because it will allow the SPY Pilot
Program to continue without
interruption. 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.9
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
6 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.
7 17 CFR 240.19b–4(f)(6).
8 17 CFR 240.19b–4(f)(6)(iii).
9 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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Federal Register / Vol. 82, No. 133 / Thursday, July 13, 2017 / 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.
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:
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–
BOX–2017–22 on the subject line.
sradovich on DSK3GMQ082PROD 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–BOX–2017–22. 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–BOX–
18:49 Jul 12, 2017
Jkt 241001
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.10
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–14661 Filed 7–12–17; 8:45 am]
IV. Solicitation of Comments
VerDate Sep<11>2014
2017–22, and should be submitted on or
before August 3, 2017.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–81091; File No. SR–Phlx–
2017–52]
Self-Regulatory Organizations;
NASDAQ PHLX LLC; Notice of Filing
and Immediate Effectiveness of
Proposed Rule Change To Extend the
SPY Pilot Program
July 7, 2017.
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 29,
2017, NASDAQ PHLX LLC (‘‘Phlx’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission (‘‘SEC’’ or
‘‘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.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
The Exchange proposes to extend for
another twelve (12) month time period
the pilot program to eliminate position
limits for options on the SPDR® S&P
500® exchange-traded fund (‘‘SPY ETF’’
or ‘‘SPY’’),3 which list and trade under
the symbol SPY (‘‘SPY Pilot Program’’).
The text of the proposed rule change
is available on the Exchange’s Web site
at https://nasdaqphlx.cchwallstreet.
com/, at the principal office of the
Exchange, and at the Commission’s
Public Reference Room.
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 ‘‘SPDR®,’’ ‘‘Standard & Poor’s®,’’ ‘‘S&P®,’’ ‘‘S&P
500®,’’ and ‘‘Standard & Poor’s 500’’ are registered
trademarks of Standard & Poor’s Financial Services
LLC. The SPY ETF represents ownership in the
SPDR S&P 500 Trust, a unit investment trust that
generally corresponds to the price and yield
performance of the SPDR S&P 500 Index.
PO 00000
10 17
1 15
Frm 00089
Fmt 4703
Sfmt 4703
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
The purpose of the proposed rule
change is to amend the Rule 1001
(Position Limits), to extend the current
pilot which expires on July 12, 2017 for
an additional twelve (12) month time
period to July 12, 2018 (‘‘Extended
Pilot’’). This filing does not propose any
substantive changes to the SPY Pilot
Program. In proposing to extend the
SPY Pilot Program, the Exchange
reaffirms its consideration of several
factors that supported the original
proposal of the SPY Pilot Program,
including (1) the availability of
economically equivalent products and
their respective position limits; (2) the
liquidity of the option and the
underlying security; (3) the market
capitalization of the underlying security
and the related index; (4) the reporting
of large positions and requirements
surrounding margin; and (5) the
potential for market on close volatility.
With this proposal, the Exchange
submits the SPY report to the
Commission, which report reflects,
during the time period from May 2016
through May 2017, the trading of
standardized SPY options with no
position limits consistent with option
exchange provisions.4 The report was
prepared in the manner specified in the
Exchange’s prior rule filing extending
the SPY Pilot Program.5 The Exchange
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. The proposed
extension will allow the Exchange and
the Commission additional time to
4 The
report is attached as Exhibit 3 [sic].
Securities Exchange Act Release No. 78124
(June 22, 2016), 81 FR 42008 (June 28, 2016) (SR–
PHLX–2016–68).
5 See
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]]>Agencies
[Federal Register Volume 82, Number 133 (Thursday, July 13, 2017)]
[Notices]
[Pages 32402-32404]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-14661]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-81092; File No. SR-BOX-2017-22]
Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend IM-3120-2 to Rule 3120 To Extend the Pilot Program That
Eliminated the Position Limits for Options on SPDR S&P 500 ETF
(``SPY'') (``SPY Pilot Program'')
July 7, 2017.
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 29, 2017, BOX Options Exchange LLC (the ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the self-regulatory organization. The Commission
is publishing this notice to solicit comments on the proposed rule
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 the
Substance of the Proposed Rule Change
The Exchange proposes to amend IM-3120-2 to Rule 3120 to extend the
pilot program that eliminated the position
[[Page 32403]]
limits for options on SPDR S&P 500 ETF (``SPY'') (``SPY Pilot
Program''). The text of the proposed rule change is available from the
principal office of the Exchange, at the Commission's Public Reference
Room and also on the Exchange's Internet Web site at https://boxexchange.com.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in Sections A, B, and C below, of the
most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend IM-3120-2 to Rule 3120 to extend the
time period of the SPY Pilot Program,\3\ which is currently scheduled
to expire on July 12, 2017, through July 12, 2018.\4\
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 67936 (September 27,
2012), 77 FR 60491 (October 3, 2012) (Notice of Filing and Immediate
Effectiveness of SR-BOX-2012-013).
\4\ See Securities Exchange Act Release No. 78247 (July 7,
2016), 81 FR 45348 (July 13, 2016) (Notice of Filing and Immediate
Effectiveness of SR-BOX-2016-31).
---------------------------------------------------------------------------
This filing does not propose any substantive changes to the SPY
Pilot Program. In proposing to extend the SPY Pilot Program, the
Exchange reaffirms its consideration of several factors that supported
the original proposal of the SPY Pilot Program, including (1) the
availability of economically equivalent products and their respective
position limits, (2) the liquidity of the option and the underlying
security, (3) the market capitalization of the underlying security and
the related index, (4) the reporting of large positions and
requirements surrounding margin, and (5) the potential for market on
close volatility.
In the proposal to extend the SPY Pilot Program, the Exchange
stated that if it were to propose an extension, permanent approval or
termination of the program, the Exchange would submit, along with any
filing proposing such amendments to the program, a report providing an
analysis of the SPY Pilot Program covering the period since the
previous extension (the ``Pilot Report'').\5\ Accordingly, the Exchange
is submitting the Pilot Report detailing the Exchange's experience with
the SPY Pilot Program. The Pilot Report is attached as Exhibit 3 to
this filing [sic]. The Exchange 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 it were to propose another extension,
permanent approval or termination of the 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, 2018, position limits in SPY
will revert to their Pre-Pilot levels. Extending the SPY Pilot Program
will give the Exchange and Commission additional time to evaluate the
pilot and its effect on the market.
---------------------------------------------------------------------------
\5\ Id.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act, in general, and Section
6(b)(5) of the Act, in particular, in that it is 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. 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.
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 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 without interruption. Additionally, 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 has neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6) thereunder.\6\
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\6\ 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 \7\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \8\ 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
believes that waiver of the operative delay is consistent with the
protection of investors and the public interest because it will allow
the SPY Pilot Program to continue without interruption. 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.\9\
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\7\ 17 CFR 240.19b-4(f)(6).
\8\ 17 CFR 240.19b-4(f)(6)(iii).
\9\ 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 32404]]
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-BOX-2017-22 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-BOX-2017-22. 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-BOX-2017-22, and should be
submitted on or before August 3, 2017.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-14661 Filed 7-12-17; 8:45 am]
BILLING CODE 8011-01-P
