Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX Order Feed (“MOR”), 56294-56297 [2017-25605]
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Federal Register / Vol. 82, No. 227 / Tuesday, November 28, 2017 / Notices
U.S.C. 78a et seq.). The Commission
plans to submit this existing collection
of information to the Office of
Management and Budget (‘‘OMB’’) for
extension and approval.
Rule 17a–19 requires every national
securities exchange and registered
national securities association to file a
Form X–17A–19 with the Commission
and the Securities Investor Protection
Corporation (‘‘SIPC’’) within 5 business
days of the initiation, suspension, or
termination of any member and, when
terminating the membership interest of
any member, to notify that member of
its obligation to file financial reports as
required by Exchange Act Rule 17a–5(b)
(17 CFR 240.17a–5(b)).
Commission staff anticipates that the
national securities exchanges and
registered national securities
associations collectively will make 800
total filings annually pursuant to Rule
17a-19 and that each filing will take
approximately 15 minutes. The total
reporting burden is estimated to be
approximately 200 total annual hours.
Written comments are invited on: (a)
Whether the proposed collection of
information is necessary for the proper
performance of the functions of the
Commission, including whether the
information shall have practical utility;
(b) the accuracy of the Commission’s
estimates of the burden of the proposed
collection of information; (c) ways to
enhance the quality, utility, and clarity
of the information collected; and (d)
ways to minimize the burden of the
collection of information on
respondents, including through the use
of automated collection techniques or
other forms of information technology.
Consideration will be given to
comments and suggestions submitted in
writing within 60 days of this
publication.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
under the PRA unless it displays a
currently valid OMB control number.
Please direct your written comments
to: Pamela Dyson, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 100 F Street NE., Washington,
DC 20549, or send an email to: PRA_
Mailbox@sec.gov.
Dated: November 22, 2017.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–25708 Filed 11–27–17; 8:45 am]
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SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–305, OMB Control No.
3235–0346]
Proposed Collection; Comment
Request
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE., Washington, DC
20549–2736
Extension:
Rule 34b–1
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.) the Securities
and Exchange Commission (the
‘‘Commission’’) is soliciting comments
on the collection of information
summarized below. The Commission
plans to submit this existing collection
of information to the Office of
Management and Budget for extension
and approval.
Rule 34b–1 under the Investment
Company Act (17 CFR 270.34b–1)
governs sales material that accompanies
or follows the delivery of a statutory
prospectus (‘‘sales literature’’). Rule
34b-1 deems to be materially misleading
any investment company (‘‘fund’’) sales
literature required to be filed with the
Securities and Exchange Commission
(‘‘Commission’’) by Section 24(b) of the
Investment Company Act (15 U.S.C.
80a–24(b)) that includes performance
data, unless the sales literature also
includes the appropriate uniformly
computed data and the legend
disclosure required in investment
company advertisements by rule 482
under the Securities Act of 1933 (17
CFR 230.482). Requiring the inclusion
of such standardized performance data
in sales literature is designed to prevent
misleading performance claims by funds
and to enable investors to make
meaningful comparisons among funds.
The Commission estimates that on
average approximately 208 respondents
file 13,004 1 responses that include the
information required by rule 34b–1 each
year. The burden resulting from the
collection of information requirements
of rule 34b–1 is estimated to be 2 hours
per response. The total hourly burden
for rule 34b–1 is approximately 26,008
hours per year in the aggregate.2
The collection of information under
rule 34b–1 is mandatory. The
1 The estimated number of responses to rule 34b–
1 is composed of 12,772 responses filed with
FINRA and 232 responses filed with the
Commission in 2016.
2 13,004 responses × 2 hours per response =
26,008 hours.
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information provided under rule 34b–1
is not kept confidential. The
Commission may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid OMB
control number.
Written comments are invited on: (a)
Whether the proposed collection of
information is necessary for the
proposed performance of the functions
of the agency, including whether
information will have practical utility;
(b) the accuracy of the agency’s estimate
of the burden of the collection of
information; (c) ways to enhance the
quality, utility, and clarity of the
information collected; and (d) ways to
minimize the burden of the collection of
information on respondents, including
through the use of automated collection
techniques or other forms of information
technology. Consideration will be given
to comments and suggestions submitted
in writing within 60 days of this
publication.
Please direct your written comments
to Pamela Dyson, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 100 F Street NE., Washington,
DC 20549; or send an email to: PRA_
Mailbox@sec.gov.
November 22, 2017.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–25710 Filed 11–27–17; 8:45 am]
BILLING CODE P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–82137; File No. SR–MIAX–
2017–46]
Self-Regulatory Organizations; Miami
International Securities Exchange LLC;
Notice of Filing and Immediate
Effectiveness of a Proposed Rule
Change To Amend the MIAX Order
Feed (‘‘MOR’’)
November 21, 2017.
Pursuant to the provisions of 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 17, 2017, Miami
International Securities Exchange, LLC
(‘‘MIAX Options’’ or the ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’) a
proposed rule change as described in
Items I and II below, which Items have
been prepared by the Exchange. The
1 15
2 17
U.S.C. 78s(b)(1).
CFR 240.19b–4.
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Federal Register / Vol. 82, No. 227 / Tuesday, November 28, 2017 / Notices
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 is filing a proposal to
amend a proprietary options market
data product.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://www.miaxoptions.com/rulefilings/ at MIAX Options’ principal
office, 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
The Exchange proposes to amend the
MIAX Order Feed (‘‘MOR’’) to reflect
the addition of a new feature. The
Exchange is proposing to indicate the
Priority Customer 3 volume represented
by derived orders, in connection with
the Exchange’s upcoming launch of
derived orders.4
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Background
The Exchange established MOR in
2015.5 MOR is a real-time full order
book data feed that provides
3 The term ‘‘Priority Customer’’ means a person
or entity that (i) is not a broker or dealer in
securities and (ii) does not place more than 390
orders in listed options per day on average during
a calendar month for its own beneficial accounts(s).
The term ‘‘Priority Customer Order’’ means an order
for the account of a Priority Customer. See
Exchange Rule 100.
4 See Exchange Act Release No. 79072 (October 7,
2016), 81 FR 71131 (October 14, 2016) (SR–MIAX–
2016–26); see also Exchange Act Release No. 81967
(October 27, 2017), 82 FR 50916 (November 2, 2017)
(SR–MIAX–2017–44).
5 See Securities Exchange Act Release No. 74759
(April 17, 2015), 80 FR 22749 (April 23, 2015) (SR–
MIAX–2015–28) (Notice of Filing and Immediate
Effectiveness of a Proposed Rule Change to
Establish the MIAX Order Feed (‘‘MOR’’) Data
Product).
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information regarding all orders on the
Exchange’s order book, including both
simple and complex orders, to enable
users to keep track of the entire order
book for all symbols listed on MIAX
Options. MOR provides the following
information regarding each order:
Product ID, order price, order original
volume, remaining volume open, and
origin code (which specifies the order
origin type as Priority Customer, Firm,
Broker/Dealer, Market Maker,6 nonMIAX Market Maker, or non-Priority
Customer). The Exchange amended the
MOR in 2016 in connection with the
launch of complex orders on the
Exchange, in order to include such
complex orders in MOR.7 The Exchange
updates MOR upon receipt of each order
or change in status to any order resting
on the book (e.g., routing, trading, or
cancelling of the order). The Exchange
makes MOR available, for the applicable
fee, to any user that requests this data
feed product.
Proposal
With the introduction of derived
orders on the Exchange, the Exchange
now proposes to add a new feature to
MOR to indicate the Priority Customer
volume represented by a derived order.
A derived order 8 is an Exchangegenerated limit order on the simple
order book that represents either the bid
or offer of one component of a complex
order resting on the Strategy Book.9
Derived orders are not routed outside of
the Exchange regardless of the price(s)
disseminated by away markets. The
Exchange determines, on a class-byclass basis, whether to make available
derived orders, and communicates such
determination to Members 10 via a
Regulatory Circular. Derived orders are
firm orders (i.e., if executed, firm for the
disseminated price and size) that are
included in the MBBO.11
Currently, for both simple orders and
complex orders, MOR identifies the
origin type of the order, as well as the
order’s original volume and the
6 The term ‘‘Market Makers’’ refers to Lead Market
Makers (‘‘LMMs’’), Primary Lead Market Makers
(‘‘PLMMs’’), and Registered Market Makers
(‘‘RMMs’’) collectively. See Exchange Rule 100.
7 See Securities Exchange Act Release No. 79146
(October 24, 2016), 81 FR 75171 (October 28, 2016)
(SR–MIAX–2016–36).
8 See Exchange Rule 518(a)(9).
9 The ‘‘Strategy Book’’ is the Exchange’s
electronic book of complex orders and complex
quotes. See Exchange Rule 518(a)(17).
10 The term ‘‘Member’’ means an individual or
organization approved to exercise the trading rights
associated with a Trading Permit. Members are
deemed ‘‘members’’ under the Exchange Act. See
Exchange Rule 100.
11 The term ‘‘MBBO’’ means the best bid or offer
on the Simple Order Book (as defined below) on the
Exchange. See Exchange Rule 518(a)(13).
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56295
remaining volume open. As discussed
above, one example of an existing origin
type is Priority Customer. Also as
discussed above, MOR currently
displays the volume associated with any
such Priority Customer order. However,
with the introduction of derived orders
on the Exchange and the inclusion of
derived orders within MOR, the origin
type of a derived order, for purposes of
display on MOR, will simply be
‘derived.’ However, a derived order can
be created for and represent an order for
any permissible origin type on the
Exchange. And for purposes of display
on MOR, a single derived order can
represent multiple orders for multiple
permissible origin codes on the
Exchange (provided all such derived
orders are for the same product ID and
at the same price). For example, for
purposes of display on MOR, a single
derived order could consist of two
orders (one with an origin code of
Priority Customer and one with an
origin code of Firm). The Exchange
believes that recipients of MOR would
be interested in seeing the Priority
Customer volume associated with a
derived order (as they are accustomed to
seeing the volume associated with nonderived Priority Customer orders in
MOR), and thus proposes to include, as
a separate feature associated with
derived orders displayed in MOR, the
Priority Customer volume associated
with such derived orders.
The proposed new feature to MOR—
including Priority Customer volume
represented by derived orders in MOR—
while a new feature, is not completely
novel and does not raise any new
regulatory issues, as the Exchange
currently makes available Priority
Customer origin code information and
Priority Customer volume information
with respect to all (i) simple, nonderived Priority Customer orders on the
Exchange, and (ii) complex Priority
Customer orders from which the derived
orders are created. Thus, the Exchange
believes that this new feature is not
completely novel and is noncontroversial. The Exchange believes
that this new feature will make
information that could otherwise
already be discerned by recipients of
MOR through looking at complex order
information more easily accessible for
users. Without this new feature, for a
derived order displayed on MOR, users
would only be able to identify the
simple order as a derived order, and
would not know how much volume of
the simple order was represented by
Priority Customer volume. To obtain
that information, a user could identify
the complex order in MOR from which
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that derived order was created, and
discern the origin type and volume of
that complex order, thus determining
the origin type (e.g., Priority Customer)
and volume associated with the simple
order. The new proposed feature simply
makes information that could otherwise
already be discerned by recipients of
MOR through looking at complex order
information more easily accessible for
users.
The Exchange believes that the
proposed new feature of MOR will
enhance subscribers’ ability to make
decisions on trading strategy, and
provide data that should help bring
about such decisions in a timely
manner, which will benefit investors
and the public interest. The Exchange
also believes that the enhanced feature
of MOR will assist market participants
in making routing decisions concerning
their options orders.
The Exchange makes MOR equally
available to any market participant that
wishes to subscribe to it. MOR is
designed to enhance a user’s ability to
analyze market conditions, and to create
and test trading models and analytical
strategies. The Exchange believes that
MOR is a valuable tool that subscribers
can use to gain comprehensive insight
into the limit order book in a particular
option. The inclusion of total Priority
Customer volume included in a given
derived order will allow subscribers to
obtain more insight into order flow and
permit them to make targeted trading
decisions.
2. Statutory Basis
The Exchange believes that its
proposed rule change is consistent with
Section 6(b) of the Act 12 in general, and
furthers the objectives of Section 6(b)(5)
of the Act 13 in particular, in that they
are designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to foster cooperation and
coordination with persons engaged in
facilitating transactions in securities, to
remove impediments to and perfect the
mechanisms of a free and open market
and a national market system and, in
general, to protect investors and the
public interest.
MOR is designed to promote just and
equitable principles of trade by
providing all subscribers with limit
order book data that should enable them
to make informed decisions on trading
strategy on the Exchange by using MOR
to assess current market conditions that
directly affect such decisions The
proposed new feature to MOR facilitates
12 15
13 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
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transactions in securities, removes
impediments to and perfects the
mechanisms of a free and open market
and a national market system by
enhancing subscribers’ ability to make
decisions on trading strategy, and by
providing data that should help bring
about such decisions in a timely
manner, all for the benefit of investors
and the public interest. The proposed
new feature to MOR removes
impediments to, and is designed to
further perfect, the mechanisms of a free
and open market and a national market
system by making the MIAX Options
market more transparent and accessible
to market participants making routing
decisions concerning their options
orders. Additionally, the proposed new
feature to MOR is also designed to
protect investors and the public interest
by making information that could
otherwise already be discerned by
recipients of MOR through looking at
complex order information more easily
accessible for users. Furthermore, the
Exchange believes that the proposed
new feature to MOR is designed to
remove impediments to and perfect the
mechanisms of a free and open market
and a national market system and, in
general, to protect investors and the
public interest, by enhancing a user’s
ability to analyze market conditions,
and to create and test trading models
and analytical strategies. It also enables
MIAX Options to compete with such
other exchanges, thereby offering market
participants with additional data in
order to seek the market center with the
best price and the most liquidity on
which to execute their transactions, all
to the benefit of investors and the public
interest, and to the marketplace as a
whole.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
MIAX Options 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. On the
contrary, the Exchange believes that the
proposed new feature to MOR will
enhance competition in the U.S. options
markets by providing subscribers on
MIAX Options a market data product
with an enhanced feature thereby
making it more competitive with
comparable products offered by other
exchanges.
Additionally, respecting intra-market
competition, the enhanced feature in
MOR will be available to all subscribers
at no additional cost, thus providing all
subscribers to MOR with an even
playing field with respect to information
and access to trading on MIAX Options.
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C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the 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 14 and Rule 19b–
4(f)(6) thereunder.15
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
change 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–
MIAX–2017–46 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–MIAX–2017–46. This file
14 15
U.S.C. 78s(b)(3)(A).
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.
15 17
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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 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–MIAX–2017–46 and should
be submitted on or before December 19,
2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–25605 Filed 11–27–17; 8:45 am]
BILLING CODE 8011–01–P
[Release No. 34–82141; File No. SR–ISE–
2017–98]
Self-Regulatory Organizations; Nasdaq
ISE, LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend the Schedule
of Fees for Regular Orders in Select
Symbols
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November 22, 2017.
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
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
Schedule of Fees for regular orders in
Select Symbols to: (1) Adjust rebates
and tier thresholds for the Market Maker
Plus program, and (2) increase taker fees
for certain Firm-Proprietary, BrokerDealer, and Priority Customer orders.
The text of the proposed rule change
is available on the Exchange’s Web site
at www.ise.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
SECURITIES AND EXCHANGE
COMMISSION
16 17
13, 2017, Nasdaq ISE, LLC (‘‘ISE’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
The purpose of the proposed rule
change is to amend the Schedule of Fees
for regular orders in Select Symbols to:
(1) Adjust rebates and tier thresholds for
the Market Maker Plus program, and (2)
increase taker fees for certain FirmProprietary,3 Broker-Dealer,4 and
Priority Customer 5 orders.
3 A ‘‘Firm Proprietary’’ order is an order
submitted by a member for its own proprietary
account.
4 A ‘‘Broker-Dealer’’ order is an order submitted
by a member for a broker-dealer account that is not
its own proprietary account.
5 A ‘‘Priority Customer’’ is a person or entity that
is not a broker/dealer in securities, and does not
place more than 390 orders in listed options per day
on average during a calendar month for its own
beneficial account(s), as defined in Nasdaq ISE Rule
100(a)(37A).
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The Exchange initially filed the
proposed pricing changes on November
1, 2017 (SR–ISE–2017–97). On
November 13, 2017, the Exchange
withdrew that filing and submitted this
filing.
Market Maker Plus
The Exchange proposes to increase
Market Maker Plus rebates in SPY and
QQQ, and modify the associated tier
thresholds to make it easier for Market
Makers 6 to qualify for higher Market
Maker Plus tiers in these symbols. The
Market Maker Plus program is designed
to attract additional liquidity from
Market Makers and encourage Market
Makers to maintain tight markets on
ISE. The Exchange believes that the
proposed fee changes will further these
objectives.
A Market Maker Plus is a Market
Maker who is on the National Best Bid
or National Best Offer (‘‘NBBO’’) a
specified percentage of the time for
series trading between $0.03 and $3.00
(for options whose underlying stock’s
previous trading day’s last sale price
was less than or equal to $100) and
between $0.10 and $3.00 (for options
whose underlying stock’s previous
trading day’s last sale price was greater
than $100) in premium in each of the
front two expiration months. Currently,
the specified percentage for time at the
NBBO for all symbols is at least 80% but
lower than 85% of the time for Tier 1,
at least 85% but lower than 95% of the
time for Tier 2 and at least 95% of the
time for Tier 3.7 The Exchange proposes
to modify the tier thresholds for SPY
and QQQ only by adding a new Tier 1
and adjusting the other Market Maker
Plus tiers such that: (1) Tier 1 rebates
are provided to Market Makers that are
on the NBBO at least 70% but lower
than 80% of the time; (2) Tier 2 rebates
are provided to market Makers that are
on the NBBO at least 80% but lower
than 85% of the time; (3) Tier 3 rebates
are provided to Market Makers that are
on the NBBO at least 85% but lower
than 90% of the time; and (4) Tier 4 and
6 The term ‘‘Market Makers’’ refers to
‘‘Competitive Market Makers’’ and ‘‘Primary Market
Makers’’ collectively. See Rule 100(a)(25).
7 A Market Maker’s single best and single worst
quoting days each month based on the front two
expiration months, on a per symbol basis, will be
excluded in calculating whether a Market Maker
qualifies for this rebate, if doing so will qualify a
Market Maker for the rebate. Other than days where
the Exchange closes early for holiday observance,
any day that the market is not open for the entire
trading day or the Exchange instructs members in
writing to route their orders to other markets may
be excluded from the Market Maker Plus tier
calculation; provided that the Exchange will only
remove the day for members that would have a
lower time at the NBBO for the specified series with
the day included.
E:\FR\FM\28NON1.SGM
28NON1
]]>Agencies
[Federal Register Volume 82, Number 227 (Tuesday, November 28, 2017)]
[Notices]
[Pages 56294-56297]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-25605]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-82137; File No. SR-MIAX-2017-46]
Self-Regulatory Organizations; Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Amend the MIAX Order Feed (``MOR'')
November 21, 2017.
Pursuant to the provisions of 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 17, 2017, Miami International
Securities Exchange, LLC (``MIAX Options'' or the ``Exchange'') filed
with the Securities and Exchange Commission (``Commission'') a proposed
rule change as described in Items I and II below, which Items have been
prepared by the Exchange. The
[[Page 56295]]
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is filing a proposal to amend a proprietary options
market data product.
The text of the proposed rule change is available on the Exchange's
Web site at https://www.miaxoptions.com/rule-filings/ at MIAX Options'
principal office, 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
The Exchange proposes to amend the MIAX Order Feed (``MOR'') to
reflect the addition of a new feature. The Exchange is proposing to
indicate the Priority Customer \3\ volume represented by derived
orders, in connection with the Exchange's upcoming launch of derived
orders.\4\
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\3\ The term ``Priority Customer'' means a person or entity that
(i) is not a broker or dealer in securities and (ii) does not place
more than 390 orders in listed options per day on average during a
calendar month for its own beneficial accounts(s). The term
``Priority Customer Order'' means an order for the account of a
Priority Customer. See Exchange Rule 100.
\4\ See Exchange Act Release No. 79072 (October 7, 2016), 81 FR
71131 (October 14, 2016) (SR-MIAX-2016-26); see also Exchange Act
Release No. 81967 (October 27, 2017), 82 FR 50916 (November 2, 2017)
(SR-MIAX-2017-44).
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Background
The Exchange established MOR in 2015.\5\ MOR is a real-time full
order book data feed that provides information regarding all orders on
the Exchange's order book, including both simple and complex orders, to
enable users to keep track of the entire order book for all symbols
listed on MIAX Options. MOR provides the following information
regarding each order: Product ID, order price, order original volume,
remaining volume open, and origin code (which specifies the order
origin type as Priority Customer, Firm, Broker/Dealer, Market Maker,\6\
non-MIAX Market Maker, or non-Priority Customer). The Exchange amended
the MOR in 2016 in connection with the launch of complex orders on the
Exchange, in order to include such complex orders in MOR.\7\ The
Exchange updates MOR upon receipt of each order or change in status to
any order resting on the book (e.g., routing, trading, or cancelling of
the order). The Exchange makes MOR available, for the applicable fee,
to any user that requests this data feed product.
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\5\ See Securities Exchange Act Release No. 74759 (April 17,
2015), 80 FR 22749 (April 23, 2015) (SR-MIAX-2015-28) (Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change to
Establish the MIAX Order Feed (``MOR'') Data Product).
\6\ The term ``Market Makers'' refers to Lead Market Makers
(``LMMs''), Primary Lead Market Makers (``PLMMs''), and Registered
Market Makers (``RMMs'') collectively. See Exchange Rule 100.
\7\ See Securities Exchange Act Release No. 79146 (October 24,
2016), 81 FR 75171 (October 28, 2016) (SR-MIAX-2016-36).
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Proposal
With the introduction of derived orders on the Exchange, the
Exchange now proposes to add a new feature to MOR to indicate the
Priority Customer volume represented by a derived order. A derived
order \8\ is an Exchange-generated limit order on the simple order book
that represents either the bid or offer of one component of a complex
order resting on the Strategy Book.\9\ Derived orders are not routed
outside of the Exchange regardless of the price(s) disseminated by away
markets. The Exchange determines, on a class-by-class basis, whether to
make available derived orders, and communicates such determination to
Members \10\ via a Regulatory Circular. Derived orders are firm orders
(i.e., if executed, firm for the disseminated price and size) that are
included in the MBBO.\11\
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\8\ See Exchange Rule 518(a)(9).
\9\ The ``Strategy Book'' is the Exchange's electronic book of
complex orders and complex quotes. See Exchange Rule 518(a)(17).
\10\ The term ``Member'' means an individual or organization
approved to exercise the trading rights associated with a Trading
Permit. Members are deemed ``members'' under the Exchange Act. See
Exchange Rule 100.
\11\ The term ``MBBO'' means the best bid or offer on the Simple
Order Book (as defined below) on the Exchange. See Exchange Rule
518(a)(13).
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Currently, for both simple orders and complex orders, MOR
identifies the origin type of the order, as well as the order's
original volume and the remaining volume open. As discussed above, one
example of an existing origin type is Priority Customer. Also as
discussed above, MOR currently displays the volume associated with any
such Priority Customer order. However, with the introduction of derived
orders on the Exchange and the inclusion of derived orders within MOR,
the origin type of a derived order, for purposes of display on MOR,
will simply be `derived.' However, a derived order can be created for
and represent an order for any permissible origin type on the Exchange.
And for purposes of display on MOR, a single derived order can
represent multiple orders for multiple permissible origin codes on the
Exchange (provided all such derived orders are for the same product ID
and at the same price). For example, for purposes of display on MOR, a
single derived order could consist of two orders (one with an origin
code of Priority Customer and one with an origin code of Firm). The
Exchange believes that recipients of MOR would be interested in seeing
the Priority Customer volume associated with a derived order (as they
are accustomed to seeing the volume associated with non-derived
Priority Customer orders in MOR), and thus proposes to include, as a
separate feature associated with derived orders displayed in MOR, the
Priority Customer volume associated with such derived orders.
The proposed new feature to MOR--including Priority Customer volume
represented by derived orders in MOR--while a new feature, is not
completely novel and does not raise any new regulatory issues, as the
Exchange currently makes available Priority Customer origin code
information and Priority Customer volume information with respect to
all (i) simple, non-derived Priority Customer orders on the Exchange,
and (ii) complex Priority Customer orders from which the derived orders
are created. Thus, the Exchange believes that this new feature is not
completely novel and is non-controversial. The Exchange believes that
this new feature will make information that could otherwise already be
discerned by recipients of MOR through looking at complex order
information more easily accessible for users. Without this new feature,
for a derived order displayed on MOR, users would only be able to
identify the simple order as a derived order, and would not know how
much volume of the simple order was represented by Priority Customer
volume. To obtain that information, a user could identify the complex
order in MOR from which
[[Page 56296]]
that derived order was created, and discern the origin type and volume
of that complex order, thus determining the origin type (e.g., Priority
Customer) and volume associated with the simple order. The new proposed
feature simply makes information that could otherwise already be
discerned by recipients of MOR through looking at complex order
information more easily accessible for users.
The Exchange believes that the proposed new feature of MOR will
enhance subscribers' ability to make decisions on trading strategy, and
provide data that should help bring about such decisions in a timely
manner, which will benefit investors and the public interest. The
Exchange also believes that the enhanced feature of MOR will assist
market participants in making routing decisions concerning their
options orders.
The Exchange makes MOR equally available to any market participant
that wishes to subscribe to it. MOR is designed to enhance a user's
ability to analyze market conditions, and to create and test trading
models and analytical strategies. The Exchange believes that MOR is a
valuable tool that subscribers can use to gain comprehensive insight
into the limit order book in a particular option. The inclusion of
total Priority Customer volume included in a given derived order will
allow subscribers to obtain more insight into order flow and permit
them to make targeted trading decisions.
2. Statutory Basis
The Exchange believes that its proposed rule change is consistent
with Section 6(b) of the Act \12\ in general, and furthers the
objectives of Section 6(b)(5) of the Act \13\ in particular, in that
they are designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in facilitating
transactions in securities, to remove impediments to and perfect the
mechanisms of a free and open market and a national market system and,
in general, to protect investors and the public interest.
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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(5).
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MOR is designed to promote just and equitable principles of trade
by providing all subscribers with limit order book data that should
enable them to make informed decisions on trading strategy on the
Exchange by using MOR to assess current market conditions that directly
affect such decisions The proposed new feature to MOR facilitates
transactions in securities, removes impediments to and perfects the
mechanisms of a free and open market and a national market system by
enhancing subscribers' ability to make decisions on trading strategy,
and by providing data that should help bring about such decisions in a
timely manner, all for the benefit of investors and the public
interest. The proposed new feature to MOR removes impediments to, and
is designed to further perfect, the mechanisms of a free and open
market and a national market system by making the MIAX Options market
more transparent and accessible to market participants making routing
decisions concerning their options orders. Additionally, the proposed
new feature to MOR is also designed to protect investors and the public
interest by making information that could otherwise already be
discerned by recipients of MOR through looking at complex order
information more easily accessible for users. Furthermore, the Exchange
believes that the proposed new feature to MOR is designed to remove
impediments to and perfect the mechanisms of a free and open market and
a national market system and, in general, to protect investors and the
public interest, by enhancing a user's ability to analyze market
conditions, and to create and test trading models and analytical
strategies. It also enables MIAX Options to compete with such other
exchanges, thereby offering market participants with additional data in
order to seek the market center with the best price and the most
liquidity on which to execute their transactions, all to the benefit of
investors and the public interest, and to the marketplace as a whole.
B. Self-Regulatory Organization's Statement on Burden on Competition
MIAX Options 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. On the contrary, the Exchange
believes that the proposed new feature to MOR will enhance competition
in the U.S. options markets by providing subscribers on MIAX Options a
market data product with an enhanced feature thereby making it more
competitive with comparable products offered by other exchanges.
Additionally, respecting intra-market competition, the enhanced
feature in MOR will be available to all subscribers at no additional
cost, thus providing all subscribers to MOR with an even playing field
with respect to information and access to trading on MIAX Options.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the 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 \14\ and Rule 19b-4(f)(6) thereunder.\15\
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 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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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 change 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-MIAX-2017-46 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-MIAX-2017-46. This file
[[Page 56297]]
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 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-MIAX-2017-46 and should be
submitted on or before December 19, 2017.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-25605 Filed 11-27-17; 8:45 am]
BILLING CODE 8011-01-P
