Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend MIAX PEARL Rule 510 To Extend the Penny Pilot Program, 61622-61624 [2017-28079]

Download as PDF 61622 Federal Register / Vol. 82, No. 248 / Thursday, December 28, 2017 / Notices sradovich on DSK3GMQ082PROD with NOTICES 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–DTC–2017–004, SR–NSCC– 2017–005, or SR–FICC–2017–008 and should be submitted on or before January 18, 2018. If comments are received, any rebuttal comments should be submitted on or before February 1, 2018. V. Accelerated Approval of the Amended Proposed Rule Changes The Commission finds good cause, pursuant to Section 19(b)(2) of the Act,66 to approve the Amended Proposed Rule Changes prior to the 30th day after the date of publication of Amendment No. 6 in the Federal Register. As discussed more fully above, the Commission finds that the Framework could help Clearing Agencies to withstand the liquidity risks that arise in or are borne by the Clearing Agencies, and to continue their critical operations and services, which helps to promote the prompt and accurate clearance and settlement of securities transactions, consistent with Section 17A(b)(3)(F) of the Act.67 By maintaining liquidity resources and monitoring sufficiency of the available liquidity resources, the Commission further finds that the Framework is designed to help reduce the possibility of the Clearing Agencies’ failure, as well as mitigate the risk of financial loss contagion caused by the Clearing Agencies’ failure. Therefore, the Framework could help further assure the safeguarding of securities and funds which are in the custody or control of the Clearing Agencies, or for which they are responsible, consistent with Section 17A(b)(3)(F).68 More specifically regarding Amendment No. 6, the amendment clarifies and modifies the Framework by (1) providing more accurate descriptions of DTC’s Collateral Monitor and Net Debit Cap, (2) modifying and elaborating on FICC and NSCC’s daily liquidity stress testing to ensure that their respective liquidity resources are sufficient to meet the cash settlement obligations of their respective largest Affiliated Family of Members, and (3) providing the analysis and escalation process for liquidity shortfalls that are identified through the daily testing with respect to Level 2 and Level 3 Scenarios. 66 15 67 15 U.S.C. 78s(b)(2). U.S.C. 78q–1(b)(3)(F). 68 Id. VerDate Sep<11>2014 18:14 Dec 27, 2017 Jkt 244001 By providing more accurate descriptions of DTC’s liquidity risk management tools, Amendment No. 6 would help ensure that the DTC Rules are transparent and clear, which would help enable its Participants to better identify and understand the risks they incur by participating in DTC. In addition, by providing additional detail around FICC and NSCC’s daily liquidity sufficiency testing, as well as the analysis and escalation process for liquidity shortfalls, Amendment No. 6 could help mitigate the risk that FICC and NSCC would be unable to promptly meet their settlement obligations due to insufficient liquidity. By doing so, the Commission finds that Amendment No. 6 could help FICC and NSCC to be in a better position to withstand their respective liquidity risks, thereby promoting the prompt and accurate clearance and settlement of securities, consistent with Section 17A(b)(3)(F) of the Act.69 Accordingly, the Commission finds good cause for approving the Amended Proposed Rule Changes on an accelerated basis, pursuant to Section 19(b)(2) of the Act.70 VI. Conclusion On the basis of the foregoing, the Commission finds that the proposed rule changes, as modified by Amendment No. 1, 3, and 6 are consistent with the requirements of the Act and in particular with the requirements of Section 17A of the Act 71 and the rules and regulations thereunder. It is therefore ordered, pursuant to Section 19(b)(2) of the Act, that the proposed rule changes SR–DTC–2017– 004, SR–NSCC–2017–005, or SR–FICC– 2017–008 as modified by Amendment Nos. 1, 3, and 6 be, and hereby are, APPROVED on an accelerated basis.72 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.73 Eduardo Aleman, Assistant Secretary. [FR Doc. 2017–27997 Filed 12–27–17; 8:45 am] BILLING CODE 8011–01–P 69 15 U.S.C. 78q–1(b)(3)(F). U.S.C. 78s(b)(2). 71 15 U.S.C. 78q–1. 72 In approving the Amended Proposed Rule Changes, the Commission considered the proposals’ impact on efficiency, competition and capital formation. 15 U.S.C. 78c(f). 73 17 CFR 200.30–3(a)(12). 70 15 PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–82391; File No. SR– PEARL–2017–39] Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend MIAX PEARL Rule 510 To Extend the Penny Pilot Program December 22, 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 December 11, 2017, MIAX PEARL LLC (‘‘MIAX PEARL’’ or ‘‘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 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 Exchange Rule 510, Interpretations and Policies .01 to extend the pilot program for the quoting and trading of certain options in pennies. The text of the proposed rule change is available on the Exchange’s website at http://www.miaxoptions.com/rulefilings/pearl, at MIAX PEARL’s 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. 1 15 2 17 E:\FR\FM\28DEN1.SGM U.S.C. 78s(b)(1). CFR 240.19b–4. 28DEN1 Federal Register / Vol. 82, No. 248 / Thursday, December 28, 2017 / Notices A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change sradovich on DSK3GMQ082PROD with NOTICES 1. Purpose The Exchange is a participant in an industry-wide pilot program that provides for the quoting and trading of certain option classes in penny increments (the ‘‘Penny Pilot Program’’ or ‘‘Program’’). The Penny Pilot Program allows the quoting and trading of certain option classes in minimum increments of $0.01 for all series in such option classes with a price of less than $3.00; and in minimum increments of $0.05 for all series in such option classes with a price of $3.00 or higher. Options overlying the PowerShares QQQTM (‘‘QQQ’’), SPDR® S&P 500® ETF (‘‘SPY’’), and iShares® Russell 2000 ETF (‘‘IWM’’), however, are quoted and traded in minimum increments of $0.01 for all series regardless of the price. The Penny Pilot Program was initiated at the then existing option exchanges in January 2007 3 and currently includes more than 300 of the most active option classes. The Penny Pilot Program is currently scheduled to expire on December 31, 2017.4 The purpose of the proposed rule change is to extend the Penny Pilot Program in its current format through June 30, 2018. In addition to the extension of the Penny Pilot Program through June 30, 2018, the Exchange proposes to extend one other date in the Rule. Currently, Interpretations and Policies .01 states that the Exchange will replace any Penny Pilot issues that have been delisted with the next most actively traded multiply listed option classes that are not yet included in the Penny Pilot Program, and that the replacement issues will be selected based on trading activity in the previous six months. Such option classes will be added to the Penny Pilot Program on the second trading day following July 1, 2017.5 3 See Securities Exchange Act Release Nos. 55154 (January 23, 2007), 72 FR 4743 (February 1, 2007) (SR–CBOE–2006–92); 55161 (January 24, 2007), 72 FR 4754 (February 1, 2007) (SR–ISE–2006–62); 54886 (December 6, 2006), 71 FR 74979 (December 13, 2006) (SR–Phlx–2006–74); 54590 (October 12, 2006), 71 FR 61525 (October 18, 2006) (SR– NYSEArca–2006–73); and 54741 (November 9, 2006), 71 FR 67176 (November 20, 2006) (SR– Amex–2006–106). 4 See Securities Exchange Act Release No. 80758 (May 24, 2017), 82 FR 25022 (May 31, 2017) (SR– PEARL–2017–24) (extending the Penny Pilot Program to December 31, 2017). 5 The month immediately preceding a replacement class’s addition to the Pilot Program (i.e., June) is not used for purposes of the six-month analysis. For example, a replacement added on the second trading day following January 1, 2018, will be identified based on trading activity from June 1, 2017, through November 30, 2017. VerDate Sep<11>2014 18:14 Dec 27, 2017 Jkt 244001 Because this date has expired and the Exchange intends to continue this practice for the duration of the Penny Pilot Program, the Exchange is proposing to amend the Rule to reflect that such option classes will be added to the Penny Pilot Program on the second trading day following January 1, 2018. The purpose of this provision is to reflect the new date on which replacement issues may be added to the Penny Pilot Program. 2. Statutory Basis MIAX PEARL believes that its proposed rule change is consistent with Section 6(b) of the Act 6 in general, and furthers the objectives of Section 6(b)(5) of the Act 7 in particular, in that it is 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. In particular, the proposed rule change, which extends the Penny Pilot Program for six months, allows the Exchange to continue to participate in a program that has been viewed as beneficial to traders, investors and public customers and viewed as successful by the other options exchanges participating in it. 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 Penny 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, facilitating investor protection, and fostering a competitive environment. In addition, consistent with previous practices, the Exchange believes the other options exchanges will be filing similar extensions of the Penny Pilot Program. 6 15 7 15 PO 00000 U.S.C. 78f(b). U.S.C. 78f(b)(5). Frm 00091 Fmt 4703 Sfmt 4703 61623 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 The Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 8 and Rule 19b–4(f)(6) thereunder.9 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 and Rule 19b–4(f)(6)(iii) thereunder. A proposed rule change filed under Rule 19b–4(f)(6) 10 normally does not become operative prior to 30 days after the date of the filing.11 However, pursuant to Rule 19b–4(f)(6)(iii),12 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 the Pilot Program.13 Accordingly, the 8 15 U.S.C. 78s(b)(3)(A)(iii). CFR 240.19b–4(f)(6). 10 17 CFR 240.19b–4(f)(6). 11 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. 12 17 CFR 240.19b–4(f)(6)(iii). 13 See Securities Exchange Act Release No. 61061 (November 24, 2009), 74 FR 62857 (December 1, 2009) (SR–NYSEArca–2009–44). 9 17 E:\FR\FM\28DEN1.SGM 28DEN1 61624 Federal Register / Vol. 82, No. 248 / Thursday, December 28, 2017 / Notices Commission designates the proposed rule change as operative upon filing with the Commission.14 At any time within 60 days of the filing of such 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) 15 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: sradovich on DSK3GMQ082PROD with NOTICES Electronic Comments • Use the Commission’s internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– PEARL–2017–39 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–PEARL–2017–39. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s internet website (http://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for website viewing and 14 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). 15 15 U.S.C. 78s(b)(2)(B). VerDate Sep<11>2014 18:14 Dec 27, 2017 Jkt 244001 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–PEARL–2017–39 and should be submitted on or before January 18, 2018. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.16 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–28079 Filed 12–27–17; 8:45 am] SECURITIES AND EXCHANGE COMMISSION [Release No. 34–82386; File No. SR–FICC– 2017–023] Self-Regulatory Organizations; Fixed Income Clearing Corporation; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Eliminate the Development Fees From the Mortgage-Backed Securities Division Clearing Rules December 21, 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 December 19, 2017, Fixed Income Clearing Corporation (‘‘FICC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II and III below, which Items have been prepared by the clearing agency. FICC filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f)(2) thereunder.4 The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 16 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(2). 1 15 Frm 00092 Fmt 4703 II. Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the clearing agency 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 clearing agency has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. (A) Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change BILLING CODE 8011–01–P PO 00000 I. Clearing Agency’s Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change consists of the elimination of the Development Fees from the Fee Schedule in the FICC Mortgage-Backed Securities Division (‘‘MBSD’’) Clearing Rules (‘‘MBSD Rules’’),5 as described in greater detail below. Sfmt 4703 1. Purpose On December 30, 2014, FICC filed proposed rule change SR–FICC–2014– 12 6 with the Commission to amend the MBSD Rules to include fees to cover the development cost of the MBSD novation service (‘‘Development Fees’’).7 The filing stated that Clearing Members would be assessed the Development Fees as of January 1, 2015 and such fees would remain in effect for three (3) consecutive years.8 Because the Development Fees will have been in place for three (3) consecutive years as of December 31, 2017, and FICC has used the Development Fees to develop the operational aspect of the MBSD novation service,9 FICC is proposing to 5 Capitalized terms not defined herein are defined in the MBSD Rules, available at http:// www.dtcc.com/legal/rules-and-procedures. 6 See Securities Exchange Act Release No. 74033 (January 12, 2015), 80 FR 2452 (January 16, 2015) (SR–FICC–2014–12). 7 Id. at 2453. 8 Id. 9 See Securities Exchange Act Release No. 80716 (May 18, 2017), 82 FR 23852 (May 24, 2017) (SR– FICC–2017–012). Specifically, the purpose of the rule filing SR–FICC–2017–012 was to amend the MBSD Rules to (1) move the time that FICC treats itself as the settlement counterparty for SBODestined Trades to the time of trade comparison, which is earlier in the lifecycle of the trade, (2) move the time that FICC novates and treats itself as the settlement counterparty for Trade-for-Trade Transactions to the time of trade comparison, which is earlier in the lifecycle of the trade, (3) novate and establish FICC as the settlement counterparty at the time of trade comparison for Specified Pool Trades, and (4) guarantee and novate Stipulated Trades, a E:\FR\FM\28DEN1.SGM 28DEN1

Agencies

[Federal Register Volume 82, Number 248 (Thursday, December 28, 2017)]
[Notices]
[Pages 61622-61624]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-28079]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82391; File No. SR-PEARL-2017-39]


Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend MIAX 
PEARL Rule 510 To Extend the Penny Pilot Program

December 22, 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 December 11, 2017, MIAX PEARL LLC (``MIAX 
PEARL'' or ``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 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 Substance 
of the Proposed Rule Change

    The Exchange is filing a proposal to amend Exchange Rule 510, 
Interpretations and Policies .01 to extend the pilot program for the 
quoting and trading of certain options in pennies.
    The text of the proposed rule change is available on the Exchange's 
website at http://www.miaxoptions.com/rule-filings/pearl, at MIAX 
PEARL's 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.

[[Page 61623]]

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange is a participant in an industry-wide pilot program 
that provides for the quoting and trading of certain option classes in 
penny increments (the ``Penny Pilot Program'' or ``Program''). The 
Penny Pilot Program allows the quoting and trading of certain option 
classes in minimum increments of $0.01 for all series in such option 
classes with a price of less than $3.00; and in minimum increments of 
$0.05 for all series in such option classes with a price of $3.00 or 
higher. Options overlying the PowerShares QQQTM (``QQQ''), 
SPDR[supreg] S&P 500[supreg] ETF (``SPY''), and iShares[supreg] Russell 
2000 ETF (``IWM''), however, are quoted and traded in minimum 
increments of $0.01 for all series regardless of the price. The Penny 
Pilot Program was initiated at the then existing option exchanges in 
January 2007 \3\ and currently includes more than 300 of the most 
active option classes. The Penny Pilot Program is currently scheduled 
to expire on December 31, 2017.\4\ The purpose of the proposed rule 
change is to extend the Penny Pilot Program in its current format 
through June 30, 2018.
---------------------------------------------------------------------------

    \3\ See Securities Exchange Act Release Nos. 55154 (January 23, 
2007), 72 FR 4743 (February 1, 2007) (SR-CBOE-2006-92); 55161 
(January 24, 2007), 72 FR 4754 (February 1, 2007) (SR-ISE-2006-62); 
54886 (December 6, 2006), 71 FR 74979 (December 13, 2006) (SR-Phlx-
2006-74); 54590 (October 12, 2006), 71 FR 61525 (October 18, 2006) 
(SR-NYSEArca-2006-73); and 54741 (November 9, 2006), 71 FR 67176 
(November 20, 2006) (SR-Amex-2006-106).
    \4\ See Securities Exchange Act Release No. 80758 (May 24, 
2017), 82 FR 25022 (May 31, 2017) (SR-PEARL-2017-24) (extending the 
Penny Pilot Program to December 31, 2017).
---------------------------------------------------------------------------

    In addition to the extension of the Penny Pilot Program through 
June 30, 2018, the Exchange proposes to extend one other date in the 
Rule. Currently, Interpretations and Policies .01 states that the 
Exchange will replace any Penny Pilot issues that have been delisted 
with the next most actively traded multiply listed option classes that 
are not yet included in the Penny Pilot Program, and that the 
replacement issues will be selected based on trading activity in the 
previous six months. Such option classes will be added to the Penny 
Pilot Program on the second trading day following July 1, 2017.\5\ 
Because this date has expired and the Exchange intends to continue this 
practice for the duration of the Penny Pilot Program, the Exchange is 
proposing to amend the Rule to reflect that such option classes will be 
added to the Penny Pilot Program on the second trading day following 
January 1, 2018.
---------------------------------------------------------------------------

    \5\ The month immediately preceding a replacement class's 
addition to the Pilot Program (i.e., June) is not used for purposes 
of the six-month analysis. For example, a replacement added on the 
second trading day following January 1, 2018, will be identified 
based on trading activity from June 1, 2017, through November 30, 
2017.
---------------------------------------------------------------------------

    The purpose of this provision is to reflect the new date on which 
replacement issues may be added to the Penny Pilot Program.
2. Statutory Basis
    MIAX PEARL believes that its proposed rule change is consistent 
with Section 6(b) of the Act \6\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act \7\ in particular, in that it 
is 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.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    In particular, the proposed rule change, which extends the Penny 
Pilot Program for six months, allows the Exchange to continue to 
participate in a program that has been viewed as beneficial to traders, 
investors and public customers and viewed as successful by the other 
options exchanges participating in it.

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 Penny 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, facilitating investor protection, and fostering a 
competitive environment. In addition, consistent with previous 
practices, the Exchange believes the other options exchanges will be 
filing similar extensions of the Penny Pilot Program.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \8\ and Rule 19b-4(f)(6) thereunder.\9\ 
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 and Rule 19b-
4(f)(6)(iii) thereunder.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \9\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \10\ normally 
does not become operative prior to 30 days after the date of the 
filing.\11\ However, pursuant to Rule 19b-4(f)(6)(iii),\12\ 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 the Pilot Program.\13\ Accordingly, the

[[Page 61624]]

Commission designates the proposed rule change as operative upon filing 
with the Commission.\14\
---------------------------------------------------------------------------

    \10\ 17 CFR 240.19b-4(f)(6).
    \11\ 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.
    \12\ 17 CFR 240.19b-4(f)(6)(iii).
    \13\ See Securities Exchange Act Release No. 61061 (November 24, 
2009), 74 FR 62857 (December 1, 2009) (SR-NYSEArca-2009-44).
    \14\ 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).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such 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) \15\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR- PEARL-2017-39 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-PEARL-2017-39. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (http://www.sec.gov/rules/sro.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549, on official business days between the hours of 10:00 a.m. and 
3:00 p.m. Copies of the filing also will be available for inspection 
and copying at the principal office of the Exchange. All comments 
received will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-PEARL-2017-39 and should be submitted on 
or before January 18, 2018.

    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. 2017-28079 Filed 12-27-17; 8:45 am]
 BILLING CODE 8011-01-P