Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend BOX Rule 3030 To Establish Rules Related to the Use of Floor Broker Error Accounts, 2692-2694 [2018-00725]
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Federal Register / Vol. 83, No. 12 / Thursday, January 18, 2018 / Notices
All submissions should refer to File
Number SR–PEARL–2017–40. 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–PEARL–2017–40 and
should be submitted on or before
February 8, 2018.
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on January 2,
2018, BOX Options Exchange LLC (the
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the self-regulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.21
Eduardo A. Aleman,
Assistant Secretary.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
[FR Doc. 2018–00724 Filed 1–17–18; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
sradovich on DSK3GMQ082PROD with NOTICES
[Release No. 34–82491; File No. SR–BOX–
2018–01]
Self-Regulatory Organizations; BOX
Options Exchange LLC; Notice of
Filing and Immediate Effectiveness of
a Proposed Rule Change To Amend
BOX Rule 3030 To Establish Rules
Related to the Use of Floor Broker
Error Accounts
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
The Exchange proposes to amend
BOX Rule 3030 to establish rules related
to the use of Floor Broker error
accounts. The text of the proposed rule
change is available from the principal
office of the Exchange, at the
Commission’s Public Reference Room
and also on the Exchange’s internet
website at https://boxoptions.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of these statements may be examined at
the places specified in Item IV below.
The self-regulatory organization has
prepared summaries, set forth in
Sections A, B, and C below, of the most
significant aspects of such statements.
1. Purpose
The Exchange proposes to amend
BOX Rule 3030 to establish rules related
to the use of Floor Broker error
accounts. First, the Exchange proposes
that each Participant who conducts a
business as a Floor Broker on the
Exchange and who is not self-clearing
must establish and maintain an account
with a clearing Participant of the
Exchange, for the sole purpose of
carrying positions resulting from bona
fide errors made in the course of its
floor brokerage business.3 Further, with
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 A ‘‘Bona fide Error’’ is defined as (i) the
inaccurate conveyance or execution of any term of
an order including, but not limited to, price,
number of shares or other unit of trading;
identification of the security; identification of the
account for which securities are purchased or sold;
2 17
January 11, 2018.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
21 17
CFR 200.30–3(a)(12).
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18:27 Jan 17, 2018
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Sfmt 4703
respect to Floor Brokers only, such an
account for option transactions must be
maintained with an entity that is also a
member of the Options Clearing
Corporation.
In practice, a Floor Broker will
remedy a bona fide error by entering a
subsequent trade on behalf of the
customer on the correct terms of the
original order. These types of
transactions are transactions which
broker-dealers place to remedy the
execution of customer orders that have
been placed in error or mishandled due
to an error involving any term of an
order, including but not limited to, for
example, price, number of contracts,
identification of security, or execution
of a transaction on the wrong side of the
market.
Next, the Exchange proposes that each
Participant which conducts business as
a Floor Broker must make available to
the Exchange, upon request, accurate
and complete records of all trades
cleared in such Participant’s error
account. These records must include the
following audit trail data elements: (1)
Name or identifying symbol of the
security; (2) number of shares or
quantity of security; (3) transaction
price; (4) time of trade execution; (5)
executing Floor Broker badge number,
or alpha symbol as may be used from
time to time, in regard to its side of the
contract; (6) executing Floor Broker
badge number, or alpha symbol as may
be used from time to time, of the contra
side to the contract; (7) clearing firm
number, or alpha symbol as may be
used from time to time, in regard to its
side of the contract; (8) clearing firm
number, or alpha symbol as may be
used from time to time, in regard to the
contra side of the contract; (9)
designation of whether the account for
which the order was executed was that
of a Participant; (10) the nature and
amount of the error; (11) the Participant
that cleared the error trade on the
Participant’s behalf; (12) an explanation
of the means by which the Participant
resolved the error; (13) the aggregate
amount of liability that the Participant
lost or otherwise misplaced order tickets; short
sales that were instead sold long or vice versa; or
the execution of an order on the wrong side of a
market; (ii) the unauthorized or unintended
purchase, sale, or allocation of securities, or the
failure to follow specific client instructions; (iii) the
incorrect entry of data into relevant systems,
including reliance on incorrect cash positions,
withdrawals, or securities positions reflected in an
account; or (iv) a delay, outage, or failure of a
communication system used to transmit market
data prices or to facilitate the delivery or execution
of an order. See Securities Exchange Act Release
No. 55884 (June 8, 2007), 72 FR 32926 (June 14,
2007) (Order Exempting Certain Error Correction
Transactions from Rule 611 of Regulation NMS
under the Securities Exchange Act of 1934).
E:\FR\FM\18JAN1.SGM
18JAN1
Federal Register / Vol. 83, No. 12 / Thursday, January 18, 2018 / Notices
incurred and: (i) Had outstanding as of
the time each such error trade entry was
recorded or (ii) had cleared by other
Participant. The Exchange believes that
it is important for the Participant to
provide the above information because
it will aid the Exchange in the
surveillance of error account activity.
The Exchange notes that the proposed
change is substantially similar to rules
at another options exchange with an
open outcry trading floor.4
sradovich on DSK3GMQ082PROD with NOTICES
2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),5 in general, and Section 6(b)(5)
of the Act,6 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
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 that the proposed
rule is consistent with the Act because
it does not unfairly discriminate
between Public Customers, Professional
Customers, Broker Dealers and Market
Makers as the rule applies to all
Participants equally. The Exchange
believes that the proposal allows Floor
Brokers the flexibility to execute orders
that correct bona fide errors out of the
Floor Broker’s error account, ensuring
that customer orders (which were
previously entered in error) are
executed, thereby protecting investors
and the public interest by ensuring that
customer orders are executed properly.
Further, the Exchange believes the
proposed rule promotes just and
equitable principles of trade by ensuring
customer orders are not harmed for
order entry errors. The Exchange does
not believe the proposed rule is unfairly
discriminatory toward customers,
issuers, or brokers because the proposed
rule simply sets forth the process for
floor brokers to correct certain bona fide
errors. As discussed above, the
Exchange believes that the proposed
change is appropriate as it is similar to
rules in place at another options
exchange with an open outcry trading
floor.7
4 See
NYSE Arca, Inc. (‘‘NYSE Arca’’) Rule 11.17.
U.S.C. 78f(b).
6 15 U.S.C. 78f(b)(5).
7 See supra note 4.
5 15
VerDate Sep<11>2014
18:27 Jan 17, 2018
Jkt 244001
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act. More
specifically, the Exchange does not
believe that the proposed rule change
will impose any burden on intramarket
competition because it will be
applicable to all Floor Brokers. In
addition, the Exchange does not believe
that the proposed change will impose
any burden on intermarket competition
because proposed Rule 3030 simply
provides a mechanism for correcting
errors. Further, the Exchange believes
that the proposed change does not
impose a burden on competition
because it simply sets forth the process
for Floor Brokers to correct bone fide
errors on the Trading Floor.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange has neither solicited
nor received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act and Rule 19b–
4(f)(6) thereunder.8
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
should be approved or disapproved.
8 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.
PO 00000
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2693
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
BOX–2018–01 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE, Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BOX–2018–01. 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 such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
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–BOX–2018–01, and should
be submitted on or before February 8,
2018.
E:\FR\FM\18JAN1.SGM
18JAN1
2694
Federal Register / Vol. 83, No. 12 / Thursday, January 18, 2018 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Eduardo A. Aleman,
Assistant Secretary.
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.
[FR Doc. 2018–00725 Filed 1–17–18; 8:45 am]
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–82488; File No. SR–MIAX–
2018–01]
Self-Regulatory Organizations; Miami
International Securities Exchange,
LLC; Notice of Filing and Immediate
Effectiveness of a Proposed Rule
Change To Amend MIAX Options Rules
700, 1308, and 1322
January 11, 2018.
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 January 3, 2018, 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
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
make minor corrective changes to
Exchange Rule 700, Exercise of Option
Contracts; Rule 1308, Supervision of
Accounts; and Rule 1322, Options
Communications.
The text of the proposed rule change
is available on the Exchange’s website at
https://www.miaxoptions.com/rulefilings/ at MIAX Options’ principal
office, and at the Commission’s Public
Reference Room.
sradovich on DSK3GMQ082PROD with NOTICES
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
9 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. 81976
(October 30, 2017), 82 FR 51312 (November 3,
2017)(SR–MIAX–2017–43).
1 15
VerDate Sep<11>2014
18:27 Jan 17, 2018
1. Purpose
The Exchange proposes to amend
Exchange Rule 700, Exercise of Option
Contracts; Rule 1308, Supervision of
Accounts; and Rule 1322, Options
Communications, to make minor nonsubstantive corrective changes.
First, the Exchange proposes to
amend Exchange Rule 700(l) to make
minor typographical corrections to
cross-references in subsections (3), (5),
and (7). The Exchange recently
amended Rule 700 by renumbering
paragraph (h) as paragraph (l).3
However, the Exchange inadvertently
left in cross-references to Rule 700(h) in
subsections (3), (5), and (7). Specifically,
Rule 700(l)(3) currently reads ‘‘[t]he
Exchange may determine to extend the
applicable deadline for the delivery of
‘‘exercise advice’’ and ‘‘advice cancel’’
notifications pursuant to this paragraph
(h) if unusual circumstances are
present.’’ The Exchange proposes to
correct the cross-reference from
‘‘paragraph (h)’’ to ‘‘paragraph (l).’’ Rule
700(l)(5) currently reads ‘‘[t]he failure of
any Member to follow the procedures in
this paragraph (h) may result in the
assessment of a fine, which may include
but is not limited to disgorgement of
potential economic gain obtained or loss
avoided by the subject exercise, as
determined by the Exchange.’’ The
Exchange proposes to correct the crossreference from ‘‘paragraph (h)’’ to
‘‘paragraph (l).’’ Furthermore, Rule
700(l)(7) currently reads ‘‘[t]he
procedures set forth in subparagraphs
(1)–(2) of this subparagraph (h) do not
apply (i) on the business day prior to
expiration in series expiring on a day
other than a business day or (ii) on the
expiration day in series expiring on a
business day.’’ The Exchange proposes
to correct the cross-reference from
‘‘subparagraph (h)’’ to ‘‘subparagraph
(l).’’ The Exchange is not proposing any
change to the wording of the Rule or to
its application. The Exchange is only
proposing to amend Rule 700(l) to
renumber incorrect cross-references in
the text of the Rule.
Second, the Exchange proposes to
amend Exchange Rule 1308,
Jkt 244001
PO 00000
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Supervision of Accounts, to make minor
typographical corrections to crossreferences in the rule text. Specifically,
Rule 1308(g)(6) cross-references Rule
1307(g) and 1307(h), which should
instead cross-reference Rule 1308(g) and
1308(h) respectively. Rule 1308(g)(6)
currently reads ‘‘[a] Member that
specifically includes its options
compliance program in a report that
complies with substantially similar
requirements of the New York Stock
Exchange or FINRA will be deemed to
have met the requirements of this Rule
1307(g) and Rule 1307(h).’’ The
Exchange proposes to correct this
language to instead cross-reference
‘‘Rule 1308(g)’’ and ‘‘Rule 1308(h)’’
respectively. Additionally, Rule 1308(h)
cross-references Rule 1307(g), which
should instead cross-reference Rule
1308(g). Rule 1308(h) currently reads
‘‘[b]y April 1 of each year, each Member
shall submit a copy of the report that
Rule 1307(g) requires the Member to
prepare . . .’’ The Exchange proposes to
correct the cross-reference from ‘‘Rule
1307(g)’’ to Rule ‘‘1308(g).’’
Finally, the Exchange proposes to
amend Exchange Rule 1322, Options
Communications, to make minor
typographical corrections and to make
corrections to cross-references in the
rule text. Specifically, Rule
1322(e)(1)(ii) is currently missing the
word ‘‘and’’ after the semicolon in this
section. Therefore, the Exchange
proposes to amend Rule 1322(e)(1)(ii) to
read ‘‘[c]ontain contact information for
obtaining a copy of the ODD; and.’’
Additionally, the Exchange proposes to
correct a typographical error in Rule
1322(e)(1)(iii). Currently, this section
contains both a period and a semicolon
at the end of the text. The Exchange
proposes to remove the semicolon and
leave only the period. Additionally, the
Exchange proposes to make minor
typographical changes to a crossreference in Rule 1322(f). Currently, this
section references ‘‘Rule 1322(e)(1)(B).’’
However, that is an erroneous crossreference and the Exchange proposes to
replace it with a cross-reference to
‘‘Rule 1322(e)(1)(ii).’’ The Exchange
notes that this does not change the
wording of the rule or its application,
but only corrects the cross-reference to
properly conform to the hierarchical
heading scheme used throughout the
Exchange’s rulebook.
2. Statutory Basis
The Exchange believes that its
proposed rule change is consistent with
Section 6(b) of the Act 4 in general, and
furthers the objectives of Section 6(b)(5)
4 15
E:\FR\FM\18JAN1.SGM
U.S.C. 78f(b).
18JAN1
]]>Agencies
[Federal Register Volume 83, Number 12 (Thursday, January 18, 2018)]
[Notices]
[Pages 2692-2694]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-00725]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-82491; File No. SR-BOX-2018-01]
Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend BOX Rule 3030 To Establish Rules Related to the Use of Floor
Broker Error Accounts
January 11, 2018.
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 January 2, 2018, BOX Options Exchange LLC (the ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the self-regulatory organization. The Commission
is publishing this notice to solicit comments on the proposed rule
change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
The Exchange proposes to amend BOX Rule 3030 to establish rules
related to the use of Floor Broker error accounts. The text of the
proposed rule change is available from the principal office of the
Exchange, at the Commission's Public Reference Room and also on the
Exchange's internet website at https://boxoptions.com.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in Sections A, B, and C below, of the
most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend BOX Rule 3030 to establish rules
related to the use of Floor Broker error accounts. First, the Exchange
proposes that each Participant who conducts a business as a Floor
Broker on the Exchange and who is not self-clearing must establish and
maintain an account with a clearing Participant of the Exchange, for
the sole purpose of carrying positions resulting from bona fide errors
made in the course of its floor brokerage business.\3\ Further, with
respect to Floor Brokers only, such an account for option transactions
must be maintained with an entity that is also a member of the Options
Clearing Corporation.
---------------------------------------------------------------------------
\3\ A ``Bona fide Error'' is defined as (i) the inaccurate
conveyance or execution of any term of an order including, but not
limited to, price, number of shares or other unit of trading;
identification of the security; identification of the account for
which securities are purchased or sold; lost or otherwise misplaced
order tickets; short sales that were instead sold long or vice
versa; or the execution of an order on the wrong side of a market;
(ii) the unauthorized or unintended purchase, sale, or allocation of
securities, or the failure to follow specific client instructions;
(iii) the incorrect entry of data into relevant systems, including
reliance on incorrect cash positions, withdrawals, or securities
positions reflected in an account; or (iv) a delay, outage, or
failure of a communication system used to transmit market data
prices or to facilitate the delivery or execution of an order. See
Securities Exchange Act Release No. 55884 (June 8, 2007), 72 FR
32926 (June 14, 2007) (Order Exempting Certain Error Correction
Transactions from Rule 611 of Regulation NMS under the Securities
Exchange Act of 1934).
---------------------------------------------------------------------------
In practice, a Floor Broker will remedy a bona fide error by
entering a subsequent trade on behalf of the customer on the correct
terms of the original order. These types of transactions are
transactions which broker-dealers place to remedy the execution of
customer orders that have been placed in error or mishandled due to an
error involving any term of an order, including but not limited to, for
example, price, number of contracts, identification of security, or
execution of a transaction on the wrong side of the market.
Next, the Exchange proposes that each Participant which conducts
business as a Floor Broker must make available to the Exchange, upon
request, accurate and complete records of all trades cleared in such
Participant's error account. These records must include the following
audit trail data elements: (1) Name or identifying symbol of the
security; (2) number of shares or quantity of security; (3) transaction
price; (4) time of trade execution; (5) executing Floor Broker badge
number, or alpha symbol as may be used from time to time, in regard to
its side of the contract; (6) executing Floor Broker badge number, or
alpha symbol as may be used from time to time, of the contra side to
the contract; (7) clearing firm number, or alpha symbol as may be used
from time to time, in regard to its side of the contract; (8) clearing
firm number, or alpha symbol as may be used from time to time, in
regard to the contra side of the contract; (9) designation of whether
the account for which the order was executed was that of a Participant;
(10) the nature and amount of the error; (11) the Participant that
cleared the error trade on the Participant's behalf; (12) an
explanation of the means by which the Participant resolved the error;
(13) the aggregate amount of liability that the Participant
[[Page 2693]]
incurred and: (i) Had outstanding as of the time each such error trade
entry was recorded or (ii) had cleared by other Participant. The
Exchange believes that it is important for the Participant to provide
the above information because it will aid the Exchange in the
surveillance of error account activity. The Exchange notes that the
proposed change is substantially similar to rules at another options
exchange with an open outcry trading floor.\4\
---------------------------------------------------------------------------
\4\ See NYSE Arca, Inc. (``NYSE Arca'') Rule 11.17.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Securities Exchange Act of 1934
(the ``Act''),\5\ in general, and Section 6(b)(5) of the Act,\6\ 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 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 that the proposed
rule is consistent with the Act because it does not unfairly
discriminate between Public Customers, Professional Customers, Broker
Dealers and Market Makers as the rule applies to all Participants
equally. The Exchange believes that the proposal allows Floor Brokers
the flexibility to execute orders that correct bona fide errors out of
the Floor Broker's error account, ensuring that customer orders (which
were previously entered in error) are executed, thereby protecting
investors and the public interest by ensuring that customer orders are
executed properly. Further, the Exchange believes the proposed rule
promotes just and equitable principles of trade by ensuring customer
orders are not harmed for order entry errors. The Exchange does not
believe the proposed rule is unfairly discriminatory toward customers,
issuers, or brokers because the proposed rule simply sets forth the
process for floor brokers to correct certain bona fide errors. As
discussed above, the Exchange believes that the proposed change is
appropriate as it is similar to rules in place at another options
exchange with an open outcry trading floor.\7\
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\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(5).
\7\ See supra note 4.
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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 not necessary or appropriate in
furtherance of the purposes of the Act. More specifically, the Exchange
does not believe that the proposed rule change will impose any burden
on intramarket competition because it will be applicable to all Floor
Brokers. In addition, the Exchange does not believe that the proposed
change will impose any burden on intermarket competition because
proposed Rule 3030 simply provides a mechanism for correcting errors.
Further, the Exchange believes that the proposed change does not impose
a burden on competition because it simply sets forth the process for
Floor Brokers to correct bone fide errors on the Trading Floor.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange has neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6) thereunder.\8\
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\8\ 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 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 [email protected]. Please include
File Number SR-BOX-2018-01 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-BOX-2018-01. 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 such filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. 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-BOX-2018-01, and should be submitted on
or before February 8, 2018.
[[Page 2694]]
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-00725 Filed 1-17-18; 8:45 am]
BILLING CODE 8011-01-P
