Self-Regulatory Organizations; C2 Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 6.4, Minimum Increments for Bids and Offers, To Extend the Penny Pilot Program, 61635-61637 [2017-27996]
Download as PDF
61635
Federal Register / Vol. 82, No. 248 / Thursday, December 28, 2017 / Notices
sradovich on DSK3GMQ082PROD with NOTICES
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (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 website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of this
filing will also 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–NYSEArca–2017–107 and
should be submitted on or before
January 18, 2018.
V. Accelerated Approval of Proposed
Rule Change, as Modified by
Amendment No. 1
The Commission finds good cause to
approve the proposed rule change, as
modified by Amendments No. 1 and No.
3, prior to the 30th day after the date of
publication of notice of Amendment No.
1 in the Federal Register.28 Amendment
No. 1 does not expand the structure of
the proposed rule change as it was
previously published for notice and
comment; Amendment No. 1
supplements the proposal by, among
other things, limiting the amount of
listed options held by the Fund that are
listed on a non-ISG/CSSA market and
expanding the continued listing
requirements applicable to the Shares.
These changes helped the Commission
to evaluate the Shares’ susceptibility to
manipulation, and determine that the
listing and trading of the Shares would
be consistent with the protection of
investors and the public interest.
Accordingly, the Commission finds
good cause, pursuant to Section 19(b)(2)
28 As noted above, Amendment No. 2 is not
subject to notice and comment. See supra note 6.
VerDate Sep<11>2014
18:14 Dec 27, 2017
Jkt 244001
of the Exchange Act,29 to approve the
proposed rule change, as modified by
Amendments No. 1 and No. 3, on an
accelerated basis.
VI. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Exchange Act,30
that the proposed rule change (SR–
NYSEArca–2017–107), as modified by
Amendments No. 1 and No. 3, be, and
it hereby is, approved on an accelerated
basis.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.31
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–28078 Filed 12–27–17; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–82376; File No. SR–C2–
2017–032]
Self-Regulatory Organizations; C2
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change to Rule 6.4, Minimum
Increments for Bids and Offers, To
Extend the Penny Pilot Program
December 21, 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 December
14, 2017, C2 Exchange, Inc. (the
‘‘Exchange’’ or ‘‘C2’’) 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 has
designated this proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A) of the
Act 3 and Rule 19b–4(f)(6)(iii)
thereunder,4 which renders it effective
upon filing with the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
29 15
U.S.C. 78s(b)(2).
U.S.C. 78s(b)(2).
31 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(6)(iii).
30 15
PO 00000
Frm 00103
Fmt 4703
Sfmt 4703
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
Rule 6.4 by extending the Penny Pilot
Program through June 30, 2018.
(additions are italicized; deletions are
[bracketed])
*
*
*
*
*
Cboe C2 Exchange, Inc.
Rules
*
*
*
*
*
Rule 6.4. Minimum Increments for Bids
and Offers
The Board of Directors may establish
minimum quoting increments for
options traded on the Exchange. When
the Board of Directors determines to
change the minimum increments, the
Exchange will designate such change as
a stated policy, practice, or
interpretation with respect to the
administration of this Rule within the
meaning of subparagraph (3)(A) of
subsection 19(b) of the Exchange Act
and will file a rule change for
effectiveness upon filing with the
Commission. Until such time as the
Board of Directors makes a change to the
minimum increments, the following
minimum increments shall apply to
options traded on the Exchange:
(1) No change.
(2) No change.
(3) The decimal increments for bids
and offers for all series of the option
classes participating in the Penny Pilot
Program are: $0.01 for all option series
quoted below $3 (including LEAPS),
and $0.05 for all option series $3 and
above (including LEAPS). For QQQQs,
IWM, and SPY, the minimum increment
is $0.01 for all option series. The
Exchange may replace any option class
participating in the Penny Pilot Program
that has been delisted with the next
most actively-traded, multiply-listed
option class, based on national average
daily volume in the preceding six
calendar months, that is not yet
included in the Pilot Program. Any
replacement class would be added on
the second trading day following [July 1,
2017]January 1, 2018. The Penny Pilot
shall expire on [December 31, 2017]June
30, 2018. Also, for so long as SPDR
options (SPY) and options on Diamonds
(DIA) participate in the Penny Pilot
Program, the minimum increments for
Mini-SPX Index Options (XSP) and
options on the Dow Jones Industrial
Average (DJX), respectively, may be
$0.01 for all option series quoting less
than $3 (including LEAPS), and $0.05
for all option series quoting at $3 or
higher (including LEAPS).
E:\FR\FM\28DEN1.SGM
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61636
Federal Register / Vol. 82, No. 248 / Thursday, December 28, 2017 / Notices
(4) No change.
*
*
*
*
The text of the proposed rule change
is also available on the Exchange’s
website (https://www.cboe.com/
AboutCBOE/CBOELegalRegulatory
Home.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
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 the
Statutory Basis for, the Proposed Rule
Change
sradovich on DSK3GMQ082PROD with NOTICES
1. Purpose
The Penny Pilot Program (the ‘‘Pilot
Program’’) is scheduled to expire on
December 31, 2017. The Exchange
proposes to extend the Pilot Program
until June 30, 2018. The Exchange
believes that extending the Pilot
Program will allow for further analysis
of the Pilot Program and a
determination of how the Pilot Program
should be structured in the future.
During this extension of the Pilot
Program, the Exchange proposes that it
may replace any option class that is
currently included in the Pilot Program
and that has been delisted with the next
most actively traded, multiply listed
option class that is not yet participating
in the Pilot Program (‘‘replacement
class’’). Any replacement class would be
determined based on national average
daily volume in the preceding six
months,5 and would be added on the
second trading day following January 1,
2018. The Exchange will announce to its
Trading Permit Holders by circular any
replacement classes in the Pilot
Program. The Exchange notes that it
intends to utilize the same parameters to
5 The month immediately preceding a
replacement class’s addition to the Pilot Program
(i.e., December) would not be used for purposes of
the six-month analysis. Thus, a replacement class
to be added on the second trading day following
January 1, 2018 would be identified based on The
Option Clearing Corporation’s trading volume data
from June 1, 2017 through November 30, 2017.
VerDate Sep<11>2014
18:14 Dec 27, 2017
Jkt 244001
select prospective replacement classes
as was originally approved.
The Exchange is specifically
authorized to act jointly with the other
options exchanges participating in the
Pilot Program in identifying any
replacement class.
believes the other exchanges will be
filing similar extensions.
2. Statutory Basis
The Exchange neither solicited nor
received comments on the proposed
rule change.
The Exchange believes the proposed
rule change is consistent with the
Securities Exchange Act of 1934 (the
‘‘Act’’) and the rules and regulations
thereunder applicable to the Exchange
and, in particular, the requirements of
Section 6(b) of the Act.6 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 7 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 foster cooperation
and coordination with persons engaged
in regulating, clearing, settling,
processing information with respect to,
and facilitation transactions in
securities, 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.
Additionally, the Exchange believes the
proposed rule change is consistent with
the Section 6(b)(5) 8 requirement that
the rules of an exchange not be designed
to permit unfair discrimination between
customers, issuers, brokers, or dealers.
In particular, the proposed rule change
allows for an extension of the Pilot
Program for the benefit of market
participants.
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.
Specifically, the Exchange believes
that, by extending the expiration of the
Pilot Program, the proposed rule change
will allow for further analysis of the
Pilot Program and a determination of
how the Program should be structured
in the future. In doing so, the proposed
rule change will also serve to promote
regulatory clarity and consistency,
thereby reducing burdens on the
marketplace and facilitating investor
protection. In addition, the Exchange
has been authorized to act jointly in
extending the Pilot Program and
6 15
7 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
8 Id.
PO 00000
Frm 00104
Fmt 4703
Sfmt 4703
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed
rule change pursuant to Section
19(b)(3)(A)(iii) of the Act 9 and Rule
19b–4(f)(6) thereunder.10 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
prior to 30 days from the date on which
it was filed, or such shorter time as the
Commission may designate if consistent
with the protection of investors and the
public interest, the proposed rule
change has become effective pursuant to
Section 19(b)(3)(A) of the Act 11 and
Rule 19b–4(f)(6)(iii) thereunder.
A proposed rule change filed under
Rule 19b–4(f)(6) normally does not
become operative prior to 30 days after
the date of the filing.12 However,
pursuant to Rule 19b–4(f)(6)(iii),13 the
Commission may 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 Commission believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest
because doing so will allow the Pilot
Program to continue without
interruption in a manner that is
consistent with the Commission’s prior
approval of the extension and expansion
of the Pilot Program and will allow the
Exchange and the Commission
additional time to analyze the impact of
9 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
11 15 U.S.C. 78s(b)(3)(A).
12 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the Exchange to give the
Commission written notice of the Exchange’s intent
to file the proposed rule change along with a brief
description and the text of the proposed rule
change, at least five business days prior to the date
of filing of the proposed rule change, or such
shorter time as designated by the Commission. The
Exchange has satisfied this pre-filing requirement.
13 17 CFR 240.19b–4(f)(6)(iii).
10 17
E:\FR\FM\28DEN1.SGM
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Federal Register / Vol. 82, No. 248 / Thursday, December 28, 2017 / Notices
the Pilot Program.14 Accordingly, the
Commission designates the proposed
rule change as operative upon filing
with the Commission.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
under Section 19(b)(2)(B) 16 of the Act 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–
C2–2017–032 on the subject line.
Paper Comments
sradovich on DSK3GMQ082PROD with NOTICES
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–C2–2017–032. This file
number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (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
14 See Securities Exchange Act Release No. 61061
(November 24, 2009), 74 FR 62857 (December 1,
2009) (SR–NYSEArca–2009–44). See also supra
note 5.
15 For purposes only of waiving the operative
delay for this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
16 15 U.S.C. 78s(b)(2)(B).
VerDate Sep<11>2014
18:14 Dec 27, 2017
Jkt 244001
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–C2–2017–032 and should
be submitted on or before January 18,
2018.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.17
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–27996 Filed 12–27–17; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–82398; File No. SR–CBOE–
2017–070]
Self-Regulatory Organizations; Cboe
Exchange, Inc.; Order Approving a
Proposed Rule Change To Amend Rule
6.56 To Include Procedures for MultiLeg Positions
December 22, 2017.
I. Introduction
On November 3, 2017, the Cboe
Exchange, Inc. (‘‘Exchange’’ or ‘‘Cboe
Options’’) filed with the Securities and
Exchange Commission (‘‘Commission’’),
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a
proposed rule to amend Rule 6.56
(Compression Forums) to include
procedures for multi-leg positions. The
proposed rule change was published for
comment in the Federal Register on
November 22, 2017.3 The Commission
did not receive any comment letters on
17 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 82102
(Nov. 16, 2017), 82 FR 55667 (Nov. 22, 2017)
(‘‘Notice’’).
1 15
PO 00000
Frm 00105
Fmt 4703
Sfmt 4703
61637
the proposed rule change. This order
approves the proposed rule change.
II. Description of the Proposed Rule
Change
As described in more detail in the
Notice,4 the Exchange proposes to
amend its SPX Compression Forum
procedures set forth in Cboe Rule 6.56,
primarily to authorize the Exchange to
include information on hypothetical
multi-leg positions constructed from the
single series voluntarily submitted by
Trading Permit Holders (‘‘TPHs’’).
Specifically, in addition to the
information Cboe Options currently
provides on single series interest, the
Exchange now also will generate a list,
using the individual series of SPX
options submitted by TPHs, of all
possible multi-leg positions based on
the three option strategies specified in
Rule 6.56—vertical call spreads, vertical
put spreads, and box spreads.5
In addition to listing hypothetical
multi-leg positions with offsetting
interest in the compression-list position
file, the Exchange also will provide to
each TPH that submitted compressionlist positions, a new individualized
multi-leg position file that includes: (a)
A complete list of all possible
combinations of offsetting multi-leg
positions that are composed of series the
individual TPH submitted as part of a
compression-list position; (b) a unique
identification number for each multi-leg
position (‘‘PID’’) that would enable the
TPH to identify particular multi-leg
positions; (c) the series that make up the
multi-leg position; and (d) the offsetting
size of the multi-leg position against
other TPHs on an individualized and
anonymous basis.6 TPHs would be able
to give the Exchange permission to
share their identity with the contraparty for a particular multi-leg position,
and vice-versa, provided that both
parties have agreed to reveal their
identities.7
Finally, Exchange will extend the
hours for submitting compression-list
positions from 3:15pm to 4:30pm
Chicago time.8
4 Id.
5 Id. at 55667. The Exchange represents that its
‘‘provision of the list does not constitute advice,
guidance, a commitment to trade, an execution, or
a recommendation to trade.’’ See id. Furthermore,
the Exchange notes that TPHs determine whether to
submit compression-list positions, whether to
participate in the compression forum, and whether
to represent orders on the trading floor.
6 Id. at 55671.
7 Id. at 55673. The disclosure of the TPH’s
identity would be done on a multi-leg position by
multi-leg position basis, as referenced by the PID.
8 Id. at 55674.
E:\FR\FM\28DEN1.SGM
28DEN1
Agencies
[Federal Register Volume 82, Number 248 (Thursday, December 28, 2017)]
[Notices]
[Pages 61635-61637]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-27996]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-82376; File No. SR-C2-2017-032]
Self-Regulatory Organizations; C2 Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change to Rule
6.4, Minimum Increments for Bids and Offers, To Extend the Penny Pilot
Program
December 21, 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 December 14, 2017, C2 Exchange, Inc. (the ``Exchange'' or
``C2'') 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
has designated this proposal as a ``non-controversial'' proposed rule
change pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-
4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with
the Commission. 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).
\4\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Rule 6.4 by extending the Penny
Pilot Program through June 30, 2018.
(additions are italicized; deletions are [bracketed])
* * * * *
Cboe C2 Exchange, Inc.
Rules
* * * * *
Rule 6.4. Minimum Increments for Bids and Offers
The Board of Directors may establish minimum quoting increments for
options traded on the Exchange. When the Board of Directors determines
to change the minimum increments, the Exchange will designate such
change as a stated policy, practice, or interpretation with respect to
the administration of this Rule within the meaning of subparagraph
(3)(A) of subsection 19(b) of the Exchange Act and will file a rule
change for effectiveness upon filing with the Commission. Until such
time as the Board of Directors makes a change to the minimum
increments, the following minimum increments shall apply to options
traded on the Exchange:
(1) No change.
(2) No change.
(3) The decimal increments for bids and offers for all series of
the option classes participating in the Penny Pilot Program are: $0.01
for all option series quoted below $3 (including LEAPS), and $0.05 for
all option series $3 and above (including LEAPS). For QQQQs, IWM, and
SPY, the minimum increment is $0.01 for all option series. The Exchange
may replace any option class participating in the Penny Pilot Program
that has been delisted with the next most actively-traded, multiply-
listed option class, based on national average daily volume in the
preceding six calendar months, that is not yet included in the Pilot
Program. Any replacement class would be added on the second trading day
following [July 1, 2017]January 1, 2018. The Penny Pilot shall expire
on [December 31, 2017]June 30, 2018. Also, for so long as SPDR options
(SPY) and options on Diamonds (DIA) participate in the Penny Pilot
Program, the minimum increments for Mini-SPX Index Options (XSP) and
options on the Dow Jones Industrial Average (DJX), respectively, may be
$0.01 for all option series quoting less than $3 (including LEAPS), and
$0.05 for all option series quoting at $3 or higher (including LEAPS).
[[Page 61636]]
(4) No change.
* * * * *
The text of the proposed rule change is also available on the
Exchange's website (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 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 the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Penny Pilot Program (the ``Pilot Program'') is scheduled to
expire on December 31, 2017. The Exchange proposes to extend the Pilot
Program until June 30, 2018. The Exchange believes that extending the
Pilot Program will allow for further analysis of the Pilot Program and
a determination of how the Pilot Program should be structured in the
future.
During this extension of the Pilot Program, the Exchange proposes
that it may replace any option class that is currently included in the
Pilot Program and that has been delisted with the next most actively
traded, multiply listed option class that is not yet participating in
the Pilot Program (``replacement class''). Any replacement class would
be determined based on national average daily volume in the preceding
six months,\5\ and would be added on the second trading day following
January 1, 2018. The Exchange will announce to its Trading Permit
Holders by circular any replacement classes in the Pilot Program. The
Exchange notes that it intends to utilize the same parameters to select
prospective replacement classes as was originally approved.
---------------------------------------------------------------------------
\5\ The month immediately preceding a replacement class's
addition to the Pilot Program (i.e., December) would not be used for
purposes of the six-month analysis. Thus, a replacement class to be
added on the second trading day following January 1, 2018 would be
identified based on The Option Clearing Corporation's trading volume
data from June 1, 2017 through November 30, 2017.
---------------------------------------------------------------------------
The Exchange is specifically authorized to act jointly with the
other options exchanges participating in the Pilot Program in
identifying any replacement class.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\6\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \7\ 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 foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitation
transactions in securities, 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. Additionally,
the Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \8\ requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers. In particular, the proposed rule change allows for
an extension of the Pilot Program for the benefit of market
participants.
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\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(5).
\8\ Id.
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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.
Specifically, the Exchange believes that, by extending the
expiration of the Pilot Program, the proposed rule change will allow
for further analysis of the Pilot Program and a determination of how
the Program should be structured in the future. In doing so, the
proposed rule change will also serve to promote regulatory clarity and
consistency, thereby reducing burdens on the marketplace and
facilitating investor protection. In addition, the Exchange has been
authorized to act jointly in extending the Pilot Program and believes
the other exchanges will be filing 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
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \9\ and Rule 19b-4(f)(6) thereunder.\10\
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 prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act \11\ and Rule 19b-
4(f)(6)(iii) thereunder.
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\9\ 15 U.S.C. 78s(b)(3)(A)(iii).
\10\ 17 CFR 240.19b-4(f)(6).
\11\ 15 U.S.C. 78s(b)(3)(A).
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A proposed rule change filed under Rule 19b-4(f)(6) normally does
not become operative prior to 30 days after the date of the filing.\12\
However, pursuant to Rule 19b-4(f)(6)(iii),\13\ the Commission may
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 Commission believes
that waiving the 30-day operative delay is consistent with the
protection of investors and the public interest because doing so will
allow the Pilot Program to continue without interruption in a manner
that is consistent with the Commission's prior approval of the
extension and expansion of the Pilot Program and will allow the
Exchange and the Commission additional time to analyze the impact of
[[Page 61637]]
the Pilot Program.\14\ Accordingly, the Commission designates the
proposed rule change as operative upon filing with the Commission.\15\
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\12\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's intent to file the proposed rule change along with a
brief description and the text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission. The
Exchange has satisfied this pre-filing requirement.
\13\ 17 CFR 240.19b-4(f)(6)(iii).
\14\ See Securities Exchange Act Release No. 61061 (November 24,
2009), 74 FR 62857 (December 1, 2009) (SR-NYSEArca-2009-44). See
also supra note 5.
\15\ For purposes only of waiving the operative delay for this
proposal, 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 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 under
Section 19(b)(2)(B) \16\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\16\ 15 U.S.C. 78s(b)(2)(B).
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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 [email protected]. Please
include File Number SR-C2-2017-032 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to File Number SR-C2-2017-032. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (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 website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-C2-2017-032 and should be submitted on
or before January 18, 2018.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
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\17\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-27996 Filed 12-27-17; 8:45 am]
BILLING CODE 8011-01-P