Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Delete Obsolete Rules, 6294-6299 [2018-02857]
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Federal Register / Vol. 83, No. 30 / Tuesday, February 13, 2018 / Notices
and electronic communication networks
(‘‘ECNs’’). Competition among trading
platforms can be expected to constrain
the aggregate return that each platform
earns from the sale of its joint products,
but different platforms may choose from
a range of possible, and equally
reasonable, pricing strategies as the
means of recovering total costs. For
example, some platforms may choose to
pay rebates to attract orders, charge
relatively low prices for market data
products (or provide market data
products free of charge), and charge
relatively high prices for accessing
posted liquidity. Other platforms may
choose a strategy of paying lower
rebates (or no rebates) to attract orders,
setting relatively high prices for market
data products, and setting relatively low
prices for accessing posted liquidity. In
this environment, there is no economic
basis for regulating maximum prices for
one of the joint products in an industry
in which suppliers face competitive
constraints with regard to the joint
offering.
The Existence of Alternatives. The
Exchange is constrained in pricing the
BBO, Book Depth and COB Data Feeds
by the availability to market participants
of alternatives to purchasing these
products. The Exchange must consider
the extent to which market participants
would choose one or more alternatives
instead of purchasing the exchange’s
data. Other options exchanges can and
have produced their own top-of-book,
book depth and complex strategies
market data products, and thus are
sources of potential competition for
CDS. For example, as noted above, ISE
and PHLX offer market data products
that compete with the BBO, Book Depth
and COB Data Feeds. The large number
of SROs, BDs, and ATSs that currently
produce proprietary data or are
currently capable of producing it
provides further pricing discipline for
proprietary data products. Each SRO,
ATS, and BD is currently permitted to
produce proprietary data products, and
many currently do. In addition, the
OPRA data feed is a significant
competitive alternative to the BBO and
last sale data included in the BBO and
Book Depth Data Feeds.
The existence of numerous
alternatives to the Exchange’s products,
including proprietary data from other
sources, ensures that the Exchange
cannot set unreasonable fees, or fees
that are unreasonably discriminatory,
when vendors and subscribers can elect
these alternatives or choose not to
purchase a specific proprietary data
product if its cost to purchase is not
justified by the returns any particular
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vendor or subscriber would achieve
through the purchase.
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 written comments on the
proposed rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 25 and paragraph (f) of Rule
19b–4 26 thereunder. 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 will institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
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–CBOE–2018–013 and
should be submitted on or before March
6, 2018.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.27
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018–02861 Filed 2–12–18; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
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–
CBOE–2018–013 on the subject line.
[Release No. 34–82646; File No. SR–CBOE–
2018–010]
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–CBOE–2018–013. 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
February 7, 2018.
Self-Regulatory Organizations; Cboe
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Delete Obsolete Rules
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 January
25, 2018, Cboe Exchange, Inc.
(‘‘Exchange’’ or ‘‘Cboe Options’’) 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 filed the proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of
the Act 3 and Rule 19b–4(f)(6)
27 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)(iii).
1 15
25 15
26 17
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U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f).
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Federal Register / Vol. 83, No. 30 / Tuesday, February 13, 2018 / Notices
thereunder.4 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 proposes to delete
Rules that no longer apply to the
Exchange and make other
nonsubstantive changes to the Rules.
The text of the proposed rule change
is also available on the Exchange’s
website (https://www.cboe.com/About
CBOE/CBOELegal
RegulatoryHome.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
Statutory Basis for, the Proposed Rule
Change
sradovich on DSK3GMQ082PROD with NOTICES
1. Purpose
The purpose of this rule change is to
delete Rules that no longer apply to the
Exchange and to make other
nonsubstantive changes to the Rules.5
Deletion of Rules
The Exchange proposes to delete the
following rules and chapters from its
rulebook:
• Rule 2.40—Market-Maker
Surcharge for Brokerage. Rule 2.40
operated as a pilot program until March
30, 2000, at which time the program
expired (and the Exchange did not
request renewal). The Exchange does
not impose a surcharge on MarketMaker transactions pursuant to this rule.
Any fees and rebates applicable to any
4 17
CFR 240.19b–4(f)(6).
Exchange initially filed the proposed rule
change on January 3, 2018 (SR–CBOE–2018–003).
On January 25, 2018 the Exchange withdrew SR–
CBOE–2018–003 and refiled as SR–CBOE–2018–
009. On business date January 25, 2018, the
Exchange subsequently withdrew SR–CBOE–108–
009 [sic] and submitted this filing.
5 The
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Market-Maker transactions are included
in the Cboe Options Fees Schedule.
• Rule 6.2—Trading Rotations. Rule
6.2 states the Exchange may use the
procedures described in current Rules
6.2, 6.2A, or 6.2B to conduct trading
rotations in all options listed on the
Exchange. Currently, the Exchange only
uses the procedures set forth in current
Rule 6.2B (proposed Rule 6.2) to
conduct trading rotations, and no longer
conducts trading rotations pursuant to
current Rule 6.2. Therefore, this
provision no longer applies to trading
on the Exchange.6
• Rule 6.2A—Rapid Opening System
(‘‘ROS’’). The Exchange used ROS to
open options prior to implementation of
the Exchange’s Hybrid Trading System,
which includes the Hybrid 3.0 Platform.
Currently, all options listed on the
Exchange trade on its Exchange’s
Hybrid Trading System. As stated in
Rule 6.2A, ROS does not apply to series
trading on the Hybrid Trading System,
which open on the Cboe Options Hybrid
Opening System (‘‘HOSS’’) (pursuant to
current Rule 6.2B (proposed Rule 6.2)).
Therefore, Rule 6.2A no longer applies
to any options listed for trading on the
Exchange.7
• Rules 6.8—RAES Operations and
6.8B—Automatic ORS Order Execution
Against Booked Orders. The Exchange’s
Retail Automatic Execution System
(‘‘RAES’’) was an automated execution
system feature of the Exchange’s Order
Routing System (‘‘ORS’’) operated by
the Exchange and that provided
automated order execution and
reporting services for options. RAES and
ORS are no longer used, as all options
trading on the Exchange currently
occurs on the Hybrid Trading System,
which includes Exchange’s Order
Handling System (‘‘OHS’’). Therefore,
RAES and ORS no longer apply to any
6 The proposed rule change makes corresponding
changes to the following rules to delete references
to trading rotations and the rule proposed to be
deleted: Rules 6.6, 6.18, 6.25(b)(1), 6.73(c) (no
longer applicable because trading rotations
pursuant to current Rule 6.2B (proposed Rule 6.2)
are fully electronic), 21.11, 22.11, and 24.13 and
Interpretation and Policy .01 (the body of proposed
Rule 24.13 states opening rotations will be
conducted in accordance with Rule 24.13 or
proposed Rule 6.2, so there is no need to include
a statement in Rule 24.13, Interpretation and Policy
.01 that states proposed Rule 6.2 describes
procedures for a trading rotation, as it would be
redundant).
7 The proposed rule change makes corresponding
changes to the following rules to delete references
to ROS and the rule proposed to be deleted: Rules
1.1(fff) and (ggg), 6.2, 6.6, 6.18, 6.25(b)(1),
8.60(c)(11) and Interpretation and Policy .02, 22.11,
and 24.13. Because the proposed rule change
deletes both Rules 6.2 and 6.2A, the proposed rule
change also renumbers Rule 6.2B to be Rule 6.2,
and makes corresponding changes throughout the
Rules, including Rules 6.1A, 6.3A, 6.12, 6.12A, 6.35
[sic] (b)(v)(B)(V), 8.15, 8.85, and 17.50.
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6295
options listed for trading on the
Exchange.8
• Rule 6.10—LOU System Operations.
The Large Order Utility (‘‘LOU’’) System
was a facility of the Exchange that
provided order routing, handling, and
execution for eligible options orders
routed electronically to the Exchange.
The LOU System is no longer used, as
all options trading on the Exchange
trade on the Hybrid Trading System.
Therefore, the LOU System no longer
applies to any options listed for trading
on the Exchange.
• Rule 6.13B—Penny Price
Improvement. Pursuant to Rule 6.13B,
the Exchange may designate one or
more options trading on the Hybrid
Trading System in a Penny Price
Improvement Program, which allows
Trading Permit Holders to provide price
improvement beyond the Exchange’s
disseminated quote for classes not
already quoted in penny increments and
for which the simple auction liaison
system is not in effect. The Exchange
currently has not designated, and has no
intention to designate, any options for
participation in this program. Therefore,
this program no longer applies to any
options listed for trading on the
Exchange.9
• Rule 6.54(a)—Accommodation
Liquidation (Cabinet Trades) for Classes
Not Trading on the Cboe Options Hybrid
System. Rule 6.54 describes cabinet
trading permitted on the Exchange.
8 The proposed rule change makes corresponding
changes to the following rules to delete references
to RAES and ORS, change references from ORS to
OHS, and the rules proposed to be deleted: Rules
1.1(fff) and (ggg), 6.3, Interpretation and Policy .05,
6.6(b) and (e) and Interpretation and Policy .01,
6.7(b) (the Hybrid System includes OHS and the
book), 6.8C (which the proposed rule change
renumbers as 6.8), 6.13(a) and (c), 6.18, 8.7(b)(iii)
and Interpretations and Policies .07 (which is being
deleted in its entirety, as described below) .11(a)
(the Exchange deleted the paragraph letter for
current paragraph (b), as it will be the only
paragraph in that Interpretation and Policy, as well
as the introduction to that paragraph regarding its
applicability to classes on the Hybrid System,
because all classes are on the Hybrid System), 8.13,
8.16, 8.51(c)(1)(a)(iii), 8.60(c)(7) (the proposed rule
change renumbers provisions (8) through (10) as (7)
through (9)) and Interpretation and Policy .02,
8.85(a)(ix) (current paragraph (a)(ix) no longer
applies, as there are no current Exchange sponsored
automated programs that require a market
participant’s participation, and the proposed rule
change renumbers subparagraphs (x) and (xi) as (ix)
and x), and deletes from current subparagraph (x)
(proposed subparagraph (xi) the introduction to that
paragraph regarding its applicability to classes on
the Hybrid System, because all classes are on the
Hybrid System), 23.7, 24.15, 24.17, 24.21(j)(1), and
24B.15.
9 The proposed rule change makes corresponding
changes to the following rules to delete references
to the Penny Price Improvement Program and the
rules proposed to be deleted: Rules 1.1(fff) and
(ggg), 6.45, Interpretations and Policies .01 and .02,
Rule 6.47, Interpretation and Policy .02, and Rule
6.74, Interpretation and Policy .09.
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Paragraph (a) describes cabinet trading
for classes not trading on the Hybrid
System, while paragraph (b) describes
cabinet trading for classes trading on the
Hybrid System. All options trading on
the Exchange currently trade on the
Hybrid Trading System, and thus Rule
6.54(a) no longer applies to any options
listed for trading on the Exchange.10
• Chapter VII—Order Book Officials.
Order Book Officials were Exchange
employees responsible for maintaining
the book with respect to classes
assigned to them, effecting proper
executions of orders placed with them,
displaying bids and offers, and
monitoring the market for classes
assigned to them. The Exchange
currently has no employees designated
as, and does not intend to designate any
employees as, Order Book Officials, as
Order Book Official functions are
generally obsolete now that most trading
occurs electronically.
The proposed rule change deletes
Rules 7.1 through 7.3, 7.4 except for
subparagraph (a)(1) (which is being
moved to Rule 6.11, with some
modifications described below), 7.5, 7.7
through 7.10, and Chapter VII, Section
B, as they relate solely to
responsibilities of Order Book Officials.
Rule 7.4(a)(1) states public customer
orders in Hybrid and Hybrid 3.0 classes
are eligible for entry into the electronic
book, and the Exchange may determine
on a class-by-class basis other orders
that are eligible for entry into the
electronic book. Currently, after a class
is open for trading (see current Rule
6.2B (proposed Rule 6.2) for a
description of orders the System accepts
prior to opening), the System accepts for
entry into the Book (1) quotes of all
Market-Makers and orders of any origin
code in Hybrid classes and (2) quotes of
Lead Market-Makers (‘‘LMMs’’) and
orders of priority customers in Hybrid
3.0 classes, while the Exchange
continues to have flexibility to permit
orders of other origin codes be eligible
for book entry. The Exchange proposes
to codify this current book eligibility
(which is consistent with the
Exchange’s authority in current Rule
7.4(a)(1)) in Rule 6.11. The proposed
rule change also deletes the provision in
current Rule 7.4(a)(1) that states Trading
Permit Holders submitting orders or
quotes for entry in to the book must do
so electronically and in the format
announced by the Exchange. It is
10 The
proposed rule change makes a
corresponding change to current paragraph (b),
eliminates paragraph lettering for paragraph (b) (as
that will be the only paragraph in the rule), and
reletters subparagraphs (i) and (ii) as (a) and (b),
consistent with paragraph lettering throughout the
rules.
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redundant to state orders and quotes for
entry in the electronic book must be
submitted electronically, and Rule
6.53A describes the types of order
formats Trading Permit Holders must
use.11
Rule 7.5, Interpretation and Policy .03
states every Floor Broker who represents
a Market-Maker with an order in any
options class must, by public outcry at
the post, indicate the identity of such
Market-Maker at the request of any
Trading Permit Holder or Order Book
Official. The proposed rule change
moves this provision (with the reference
to Order Book Official deleted) to Rule
6.73, which relates to responsibilities of
Floor Brokers.
Rule 7.6 regarding the requirement for
PAR Official to report unusual activity
is proposed to move to Rule
6.12B(b)(v).12 The proposed rule change
11 The proposed rule change makes
corresponding changes to the following rules to
change cross-references to Rule 7.4 to Rule 6.11:
Rules 6.13(b)(i)(A)(2) and (iii), 23.3(b), and 24.11A
(the proposed rule change also deletes the
Interpretations and Policies section of this rule, as
there are currently none).
12 The proposed rule change makes
corresponding changes to the following rules to
delete references to Order Book Officials and the
rules proposed to be deleted: Rules 6.3,
Interpretations and Policies .01 and .02, including
the related footnote (these interpretations also
delete references to post directors, which are no
longer used at the Exchange, and only relate to prior
circumstances under which Post Directors or Order
Book Officials would suspend trading; those
functions no longer exist on the Exchange, and the
Exchange currently only halts trading in accordance
with the remaining provisions of Rule 6.3 and other
rules related to trading halts), 6.6(b) and (e) (which
also deletes references to post directors, which are
no longer used at the Exchange), 6.12A, 6.20(a) and
Interpretations and Policies .02 (currently, there are
only four PAR Officials on the trading floor, who
all float to all trading crowds as necessary and are
thus no longer assigned to classes) and .04(ii),
6.43(a), 6.54, Interpretations and Policies .01 and
.02 (the proposed rule change replaces references to
Order Book Officials to PAR Officials, consistent
with Interpretation and Policy .02, which indicates
PAR Officials may perform the functions of Order
Book Officials for purposes of that rule), 6.73,
Interpretation and Policy .01 (which only relates to
comparing execution prices to those in displayed by
an Order Book Official (pursuant to Rules 6.45(b)
and 6.73, Floor Brokers must use due diligence to
execute orders at the best price and provide first
priority based on price); additionally, bids and
offers are made in response to requests from Floor
Brokers that represent orders in open outcry (see
Rule 6.4(b) [sic] and Rule 6.73 contains other
provisions that require a Floor Broker to make sure
all persons in the crowd are aware of requests for
quotes and use due diligence when handling and
executing orders, making Interpretation and Policy
.01 redundant and unnecessary), 8.7(c) (the
Exchange notes Market-Makers not permitted to
enter a trading station in a floor brokerage capacity,
as set forth in Rule 8.8) and Interpretation and
Policy .09 (changes cross-reference to Rule 7.5 to
Rule 8.7(d)(iv), which describes current MarketMaker obligations, including the obligation of
Market-Maker to provide a quote upon Exchange
request), and 24.13 and Interpretation and Policy
.03 (which the proposed rule change renumbers to
.02).
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moves currently applicable provisions
in Rule 7.12 (regarding PAR Officials) to
Rule 6.12B (with some nonsubstantive
changes).13 PAR Officials are Exchange
employees or independent contractors
whom the Exchange may designate as
being responsible for operating a PAR
workstation and effecting proper
executions of orders placed with them.
PAR Officials no longer maintain the
book with respect to assigned classes, as
the electronic book manages electronic
orders and quotes. The proposed rule
change deletes the provision in current
Rule 7.12(b)(i) regarding the definition
of customer limit orders, as customer
orders are now defined in Rule
1.1(www) and (yyy) (which are
proposed to be relettered as (yyy) and
(zzz), as described below). The proposed
rule change deletes current Rule
7.12(b)(i)(C), which applies to the
Intermarket Options Linkage Plan that
no longer exists.14 Pursuant to the
current linkage plan, including the
definition of an intermarket sweep order
(‘‘ISOs’’) in Rule 6.53, ISOs may only be
handled electronically (they may only
be entered as immediate-or-cancel or for
book entry if they do not execute), and
thus would never be routed to a PAR
workstation under the Rules. Therefore,
PAR Officials no longer have
responsibilities with respect to routed
orders under the current linkage plan.
The proposed rule change moves Rule
7.12(b)(i)(E), which relates to orders
received during a trading rotation
pursuant to current Rule 6.2 or HOSS
pursuant to current Rule 6.2B (proposed
Rule 6.2), to proposed Rule
6.12B(b)(i)(D). The proposed rule
change changes the term immediately to
promptly, as under current Rule 7.12
and proposed Rule 6.12(b), the term
immediately means as soon as
practicable but within 30 seconds.
However, proposed Rule 6.12B(b)(i)(D)
exempts these orders from being
displayed within 30 seconds, so the
term immediate did not seem
appropriate. The term promptly still
requires action as soon as practicable,
but may be longer than 30 seconds. The
proposed rule change moves current
Rule 7.12(b)(ii), (iv), and (v) to proposed
Rule 6.12B(b)(ii), (iii), and (iv),
respectively, and moves current Rule
7.12(c) and (d) to proposed Rule
6.12B(c) and (d), respectively. The
proposed rule change deletes Rule
13 The proposed rule change makes
corresponding changes to the following rules to
change cross-references to Rule 7.12 to Rule 6.12B:
Rules 6.12A, 6.18(d)(i), and 6.20(a).
14 Chapter VI, Section E describes Exchange
responsibilities pursuant to the current linkage
plan, the Options Order Protection and Locked/
Crossed Market Plan.
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7.12(b)(iii), as PAR Officials no longer
maintain the book (as described above)
and do not have the ability to remove
orders from the book. The proposed rule
change replaces the term ‘‘senior
Trading Operations official’’ with
‘‘senior Help Desk personnel’’ in current
Rule 7.12(b)(iv) (proposed Rule
6.12(b)(iii)), which term is used
throughout the rules. The proposed rule
change deletes Rule 7.12, Interpretation
and Policy .01, as it relates to the
Exchange’s responsibility to appoint
PAR Officials to trading stations prior to
March 24, 2006. The Exchange currently
has PAR Officials appointed to all
trading stations on the trading floor.
• Autoquote. Autoquote was an
Exchange electronic quotation system
that automatically monitored and
updated market quotes using a
mathematical formula measuring certain
characteristics of the option and
underlying interest. Rules related to
LMMs and DPMs require them to
provide continuous electronic quotes in
appointed classes using Autoquote or a
proprietary automated quotation
updating system. Currently, all MarketMakers that submit electronic quotes
use a proprietary system, and Autoquote
is no longer used. The proposed rule
change deletes Rule 8.7, Interpretation
and Policy .07, which describes
Autoquote, as well as the requirement of
LMMs and DPMs to provide electronic
quotes, which requirement is included
in Rules 8.15 and 8.85, respectively.15
• S&P 100 Modified Opening
Rotation. Rule 24.13, Interpretation and
Policy .02 provides a modified opening
rotation that the Exchange may use for
S&P 100 options, but the rule also
provides the Exchange with the
authority to open this class using HOSS
pursuant to current Rule 6.2B (proposed
Rule 6.2). The Exchange currently uses
HOSS to open S&P 100 options, and
does not intend to use the modified
opening in the future. Therefore, this
provision no longer applies to the
opening of S&P 100 options.16
• Rule 8.7(c)—Market-Maker Entry
into Trading Station in Unappointed
Class other than As Floor Broker. Rule
15 The proposed rule change also deletes
references to Autoquote in Rules 6.43(b), 8.15(c),
8.51(c)(1)(a)(iii), 8.60 Interpretation and Policy .02.
Rules 8.7, Interpretation and Policy .07, 8.15(c), and
8.85(a)(x) provide components of a formula used for
automated quoting by Market-Makers using
proprietary automated quoting systems will be
disclosed unless the Exchange exempts them from
disclosing this information. For competitive
reasons, the Exchange exempts all Market-Makers
from disclosing this information, so the proposed
rule change deletes those provisions, as it does not
intend to require Market-Makers from disclosing
proprietary information going forward.
16 The proposed rule change also renumbers
current Interpretation and Policy .03 to .02.
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8.7(c) states whenever a Market-Maker
enters the trading station for a class of
options contracts in a class in which it
is not appointed, in other than a floor
brokerage capacity, the Market-Maker
must fulfill obligations established in
Rule 8.7(b) and, for the rest of the
trading day, as well as undertake certain
additional obligations. This rule text
essentially requires a Market-Maker to
act like a Market-Maker when it enters
a trading station in the capacity of a
Market-Maker in an unappointed class.
However, pursuant to Rule 8.3, on the
trading floor, Market-Makers have an
appointment to trade in all hybrid
classes, so if it goes to any trading
station on the floor as a Market-Maker,
it has an appointment for the classes at
that station and is subject to Marketmaker obligations. That provision, in
conjunction with the restriction on
acting as a Market-Maker and Floor
Broker on the same day, make the
provision in Rule 8.7(c) unnecessary
and duplicative. Therefore, the
proposed rule change deletes this
provision.
• Market-Maker Exemption from Rule
8.7(b)(iv) Obligations. Rule 8.7,
Interpretation and Policy .13 provided
Market-Makers with a temporary
exemption from requirements set forth
in Rule 8.7(d)(iv) on a pilot basis until
February 17, 2007. That pilot has
expired, and the Exchange did not
renew it. Therefore, the proposed rule
change deletes Rule 8.7, Interpretation
and Policy .03, as it no longer applies
to trading on the Exchange.
• Chapter XXIVA—Flexible Exchange
Options (‘‘FLEX Options’’). When the
Exchange began offering FLEX Options
for trading, FLEX Options traded
pursuant to Rule XXIVA on the trading
floor. The Exchange then developed the
FLEX Hybrid Trading System on which
FLEX Options could trade both on the
trading floor and electronically. Chapter
XXIVB describes FLEX Options trading
on this system, and provides the
Exchange with ability to permit FLEX
trading pursuant to Chapter XXIVA or
XXIVB. The open outcry rules in
Chapter XXIVA are substantially similar
to those in Chapter XXIVB. The
Exchange has determined all FLEX
trading must occur on the FLEX Hybrid
Trading System pursuant to Chapter
XXIVB. Therefore, Chapter XXIVA no
longer applies to the trading of any
FLEX Options.17 The proposed rule
17 The proposed rule change also deletes
references to Chapter XXIVA in the following rules:
Rules 3.2(b), 5.9, 6.1A(c), 6.24, Interpretation and
Policy .05, 6.49A(c)(6), Introduction to Chapter XX,
20.12, Introduction to Chapter XXII, 22.16,
Introduction to current Chapter XXIVB, 28.17,
29.18, and Introduction to Chapter XXIX.
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6297
change renumbers Chapter XXIVB and
the rules in that chapter to Chapter
XXIVA, and updates cross-references
throughout the rules.
• Chapter XXVI—Market Baskets.
Chapter XXVI describes rules applicable
to market basket contracts, which are
contracts obligating the seller to sell and
the purchaser to purchase a designated
number of shares of each of the stocks
comprising the index on which the
market basket is based. The Exchange
currently does not list, and does not
intend to list in the future, market
basket contracts for trading. Therefore,
Chapter XXVI no longer applies to any
options trading on the Exchange.18
• Chapter XXVII—Buy-Write Option
Unitary Derivatives (‘‘BOUNDS’’).
Chapter XXVIII describes rules
applicable to BOUNDS, which are
securities issued, or subject to issuance,
by the Options Clearing Corporation
pursuant to its rules, which gives
holders and writers thereof such rights
and obligations as may be provided in
its rules. The Exchange currently does
not list, and does not intend to list in
the future, BOUNDS for trading.
Therefore, Chapter XXVII no longer
applies to any options trading on the
Exchange.
• Chapter XXXI—Approval of
Securities for Original Listing. Chapter
XXXI describes rules pursuant to which
the Exchange may list equity securities
for listing on the Exchange. The
Exchange currently does not list any
equity securities on the Exchange.
Therefore, Chapter XXXI currently
applies to no securities listed on the
Exchange.19
Pursuant to Section 957 of the DoddFrank Act, Section 6(b)(10) of the Act 20
requires the rules of each national
securities exchange to prohibit any
member that is not the beneficial owner
of a security registered under Section 12
of the Act 21 from granting a proxy to
vote the security in connection with
certain shareholder votes, unless the
beneficial owner of the security has
instructed the member to vote the proxy
in accordance with the voting
instructions of the beneficial owner. The
18 The proposed rule change also deletes
references to market baskets and the rules proposed
to be deleted in: Rules 8.8, Interpretation and Policy
.02 and 24B.10 (which is proposed to be
renumbered as 24A.10).
19 Options may be listed for trading on the
Exchange pursuant to Chapter V and XXIV. The
proposed rule change leaves a placeholder in
Chapters XXX and XXXI for rules related to listing
and trading of equity securities. The Exchange
would file a proposed rule change to adopt new
rules if it determines to list and trade equity
securities in the future.
20 15 U.S.C. 78f(b)(10).
21 15 U.S.C. 78l.
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13FEN1
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Federal Register / Vol. 83, No. 30 / Tuesday, February 13, 2018 / Notices
shareholder votes covered by Section
957 include any vote with respect to (1)
the election of a member of the board of
directors of an issuer (except for a vote
with respect to the uncontested election
of a member of the board of directors of
any investment company registered
under the Investment Company Act of
1940 (the ‘‘Investment Company Act’’),
(2) executive compensation, or (3) any
other significant matter, as determined
by the Commission, by rule.22
Rules 31.82 through 31.88 currently
include provisions that cover these
proxy voting requirements with respect
to Trading Permit Holders. However,
because this proposed rule change
deletes Chapter XXXI, the proposed rule
change adds Rule 4.25 to retain the
provisions required by Section 957.
Proposed Rule 4.25 is substantially
similar to rules of other options
exchanges.23
• Chapters XL through XLIX—ScreenBased Trading. Chapters XL through
XLIX describe trading on the Exchange’s
screen-based trading system. The
screen-based trading system is no longer
used, as all options trading on the
Exchange trade on the Hybrid Trading
System. Therefore, the screen-based
trading rules no longer apply to any
options listed for trading on the
Exchange.24
• Chapters L through LIV—CBOE
Stock Exchange (‘‘CBSX’’). Chapters L
through LIV describe trading on CBSX,
which is the Exchange’s facility for
trading stocks, warrants, IPRs, IPSs, and
Trust Issued Receipts (non-options
securities). CBSX ceased market
operations on April 30, 2014. Therefore,
the CBSX rules no longer apply to any
trading on the Exchange.25 The
Exchange would file a proposed rule
change to adopt new rules if it
determines to list and trade non-options
securities in the future.
Additional Nonsubstantive Changes
In addition to nonsubstantive changes
described above, the proposed rule
change makes the following
nonsubstantive changes:
• The proposed rule change moves
Interpretation and Policy .01 to the
definition of Professional in Rule
22 15
U.S.C. 78f(b)(10)(B).
e.g., C2 Supplemental Rules to C2 Chapter
4 and Nasdaq ISE Rule 421.
24 The proposed rule change makes
corresponding changes to the following rules to
delete references to screen-based trading and the
rules proposed to be deleted: Rules 1.1(fff) and
(ggg), 3.2(b), and 3.3.
25 The proposed rule change makes
corresponding changes to the following rules to
delete references to CBSX and the rules proposed
to be deleted: Rules 3.1A, 3.2(b), 3.3, and 6.20A,
Interpretation and Policy .01.
sradovich on DSK3GMQ082PROD with NOTICES
23 See,
VerDate Sep<11>2014
23:12 Feb 12, 2018
Jkt 244001
1.1(ggg) to Interpretation and Policy .06
to Rule 1.1, so that all Interpretations
and Policies to Rule 1.1 are in the same
place.
• Currently, there are two paragraphs
erroneously lettered as Rule 1.1(mmm)
and (ppp). The proposed rule change
corrects this lettering and updates the
paragraph lettering to reflect these
corrections.
• The proposed rule change makes
updates throughout the rules to conform
paragraph lettering and numbering to
other rules, as well as to reflect deleted
rule provisions.
• Rule 6.2, Interpretation and Policy
.01(b) and (c) erroneously refer to LMMs
as LLMs. The proposed rule change
corrects [sic] those erroneous references.
The proposed rule change amends
Rule 6.43(b) to indicate it only applies
to Hybrid 3.0 classes, which is
consistent with the current rule text and
current trading practices.
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.26 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 27 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 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 the
proposed rule change is consistent with
the Section 6(b)(5) 28 requirement that
the rules of an exchange not be designed
to permit unfair discrimination between
customers, issuers, brokers, or dealers.
In particular, by deleting rules that no
longer apply to Cboe Options trading
(which rules have generally not been
applicable in years), and making other
nonsubstantive changes to better
organize and more consistently number
and letter rules, the rules will more
clearly identify currently applicable
rules, which the Exchange believes
removes impediments to and perfects
26 15
27 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
28 Id.
PO 00000
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Fmt 4703
Sfmt 4703
the mechanism of a free and open
market. The Exchange believes the
proposed rule change will eliminate
confusion regarding which rules apply
to current trading, which ultimately
protects investors and the public
interest. The proposed rule change has
no impact on current trading on Cboe
Options.
The proposed rule change regarding
proxy voting is substantially similar to
C2 Supplemental Rules to C2 Chapter 4
and Nasdaq ISE Rule 421 and consistent
with Section 957 of the Dodd-Frank Act.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Cboe Options 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. The
proposed rule change deletes rules that
no longer apply to Cboe Options trading
and makes other nonsubstantive
changes, and thus has no impact on
current trading on Cboe Options.
Therefore, the proposed rule change has
no impact on competition. The
proposed rule change eliminates
confusion with respect to rules
applicable to current trading on Cboe
Options.
The proposed rule change regarding
proxy voting is substantially similar to
C2 Supplemental Rules to C2 Chapter 4
and Nasdaq ISE Rule 421 and consistent
with Section 957 of the Dodd-Frank Act.
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
Because the foregoing proposed rule
change does not:
A. Significantly affect the protection
of investors or the public interest;
B. impose any significant burden on
competition; and
C. 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 29 and Rule 19b–4(f)(6) 30
thereunder.31
29 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
31 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires a self-regulatory organization to
give the Commission written notice of its intent to
file the proposed rule change, along with a brief
30 17
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Federal Register / Vol. 83, No. 30 / Tuesday, February 13, 2018 / Notices
A proposed rule change filed under
Rule 19b–4(f)(6) normally does not
become operative for 30 days after the
date of filing. However, Rule 19b–
4(f)(6)(iii) 32 permits the Commission to
designate a shorter time if such action
is consistent with the protection of
investors and the public interest. The
Exchange requests that the Commission
waive the 30-day operative delay.
According to the Exchange, the
proposed rule change is consistent with
the protection of investors and the
public interest because it eliminates
confusion as to the rules that currently
apply to trading on Cboe Options. The
Commission believes that deleting
obsolete rules will add clarity and
transparency to the Exchange’s rules.
Therefore, the Commission finds that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest.
Accordingly, the Commission waives
the 30-day operative delay and
designates the proposed rule change
operative upon filing.33
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 will institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
sradovich on DSK3GMQ082PROD with NOTICES
• 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–
CBOE–2018–010 on the subject line.
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 requirement.
32 17 CFR 240.19b–4(f)(6)(iii).
33 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
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23:12 Feb 12, 2018
Jkt 244001
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–CBOE–2018–010. 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–CBOE–2018–010 and
should be submitted on or before March
6, 2018.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.34
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018–02857 Filed 2–12–18; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–82653; File No. SR–Phlx–
2018–13]
Self-Regulatory Organizations; Nasdaq
PHLX LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend the
Exchange’s Pricing Schedule To
Exclude NDX and NDXP Options From
the Strategy Caps and From Special
Pricing for FLEX Transactions
February 7, 2018.
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 January
26, 2018, Nasdaq PHLX LLC (‘‘Phlx’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission (‘‘SEC’’ or
‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III, 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 proposes to amend the
Exchange’s Pricing Schedule to exclude
A.M. and P.M.-settled options on broadbased indexes with nonstandard
expiration dates from its pricing for
Strategy Caps and for FLEX
transactions.
While changes to the Pricing
Schedule pursuant to this proposal are
effective upon filing, the Exchange has
designated these changes to be operative
on February 1, 2018.
The text of the proposed rule change
is available on the Exchange’s website at
https://nasdaqphlx.cchwallstreet.com/,
at the principal office of the Exchange,
and at the Commission’s Public
Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
1 15
34 17
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2 17
E:\FR\FM\13FEN1.SGM
U.S.C. 78s(b)(1).
CFR 240.19b–4.
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]]>Agencies
[Federal Register Volume 83, Number 30 (Tuesday, February 13, 2018)]
[Notices]
[Pages 6294-6299]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-02857]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-82646; File No. SR-CBOE-2018-010]
Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Delete
Obsolete Rules
February 7, 2018.
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 January 25, 2018, Cboe Exchange, Inc. (``Exchange'' or ``Cboe
Options'') 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
filed the proposal as a ``non-controversial'' proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6)
[[Page 6295]]
thereunder.\4\ 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)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to delete Rules that no longer apply to the
Exchange and make other nonsubstantive changes to the Rules.
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
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of this rule change is to delete Rules that no longer
apply to the Exchange and to make other nonsubstantive changes to the
Rules.\5\
---------------------------------------------------------------------------
\5\ The Exchange initially filed the proposed rule change on
January 3, 2018 (SR-CBOE-2018-003). On January 25, 2018 the Exchange
withdrew SR-CBOE-2018-003 and refiled as SR-CBOE-2018-009. On
business date January 25, 2018, the Exchange subsequently withdrew
SR-CBOE-108-009 [sic] and submitted this filing.
---------------------------------------------------------------------------
Deletion of Rules
The Exchange proposes to delete the following rules and chapters
from its rulebook:
Rule 2.40--Market-Maker Surcharge for Brokerage. Rule 2.40
operated as a pilot program until March 30, 2000, at which time the
program expired (and the Exchange did not request renewal). The
Exchange does not impose a surcharge on Market-Maker transactions
pursuant to this rule. Any fees and rebates applicable to any Market-
Maker transactions are included in the Cboe Options Fees Schedule.
Rule 6.2--Trading Rotations. Rule 6.2 states the Exchange
may use the procedures described in current Rules 6.2, 6.2A, or 6.2B to
conduct trading rotations in all options listed on the Exchange.
Currently, the Exchange only uses the procedures set forth in current
Rule 6.2B (proposed Rule 6.2) to conduct trading rotations, and no
longer conducts trading rotations pursuant to current Rule 6.2.
Therefore, this provision no longer applies to trading on the
Exchange.\6\
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\6\ The proposed rule change makes corresponding changes to the
following rules to delete references to trading rotations and the
rule proposed to be deleted: Rules 6.6, 6.18, 6.25(b)(1), 6.73(c)
(no longer applicable because trading rotations pursuant to current
Rule 6.2B (proposed Rule 6.2) are fully electronic), 21.11, 22.11,
and 24.13 and Interpretation and Policy .01 (the body of proposed
Rule 24.13 states opening rotations will be conducted in accordance
with Rule 24.13 or proposed Rule 6.2, so there is no need to include
a statement in Rule 24.13, Interpretation and Policy .01 that states
proposed Rule 6.2 describes procedures for a trading rotation, as it
would be redundant).
---------------------------------------------------------------------------
Rule 6.2A--Rapid Opening System (``ROS''). The Exchange
used ROS to open options prior to implementation of the Exchange's
Hybrid Trading System, which includes the Hybrid 3.0 Platform.
Currently, all options listed on the Exchange trade on its Exchange's
Hybrid Trading System. As stated in Rule 6.2A, ROS does not apply to
series trading on the Hybrid Trading System, which open on the Cboe
Options Hybrid Opening System (``HOSS'') (pursuant to current Rule 6.2B
(proposed Rule 6.2)). Therefore, Rule 6.2A no longer applies to any
options listed for trading on the Exchange.\7\
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\7\ The proposed rule change makes corresponding changes to the
following rules to delete references to ROS and the rule proposed to
be deleted: Rules 1.1(fff) and (ggg), 6.2, 6.6, 6.18, 6.25(b)(1),
8.60(c)(11) and Interpretation and Policy .02, 22.11, and 24.13.
Because the proposed rule change deletes both Rules 6.2 and 6.2A,
the proposed rule change also renumbers Rule 6.2B to be Rule 6.2,
and makes corresponding changes throughout the Rules, including
Rules 6.1A, 6.3A, 6.12, 6.12A, 6.35 [sic] (b)(v)(B)(V), 8.15, 8.85,
and 17.50.
---------------------------------------------------------------------------
Rules 6.8--RAES Operations and 6.8B--Automatic ORS Order
Execution Against Booked Orders. The Exchange's Retail Automatic
Execution System (``RAES'') was an automated execution system feature
of the Exchange's Order Routing System (``ORS'') operated by the
Exchange and that provided automated order execution and reporting
services for options. RAES and ORS are no longer used, as all options
trading on the Exchange currently occurs on the Hybrid Trading System,
which includes Exchange's Order Handling System (``OHS''). Therefore,
RAES and ORS no longer apply to any options listed for trading on the
Exchange.\8\
---------------------------------------------------------------------------
\8\ The proposed rule change makes corresponding changes to the
following rules to delete references to RAES and ORS, change
references from ORS to OHS, and the rules proposed to be deleted:
Rules 1.1(fff) and (ggg), 6.3, Interpretation and Policy .05, 6.6(b)
and (e) and Interpretation and Policy .01, 6.7(b) (the Hybrid System
includes OHS and the book), 6.8C (which the proposed rule change
renumbers as 6.8), 6.13(a) and (c), 6.18, 8.7(b)(iii) and
Interpretations and Policies .07 (which is being deleted in its
entirety, as described below) .11(a) (the Exchange deleted the
paragraph letter for current paragraph (b), as it will be the only
paragraph in that Interpretation and Policy, as well as the
introduction to that paragraph regarding its applicability to
classes on the Hybrid System, because all classes are on the Hybrid
System), 8.13, 8.16, 8.51(c)(1)(a)(iii), 8.60(c)(7) (the proposed
rule change renumbers provisions (8) through (10) as (7) through
(9)) and Interpretation and Policy .02, 8.85(a)(ix) (current
paragraph (a)(ix) no longer applies, as there are no current
Exchange sponsored automated programs that require a market
participant's participation, and the proposed rule change renumbers
subparagraphs (x) and (xi) as (ix) and x), and deletes from current
subparagraph (x) (proposed subparagraph (xi) the introduction to
that paragraph regarding its applicability to classes on the Hybrid
System, because all classes are on the Hybrid System), 23.7, 24.15,
24.17, 24.21(j)(1), and 24B.15.
---------------------------------------------------------------------------
Rule 6.10--LOU System Operations. The Large Order Utility
(``LOU'') System was a facility of the Exchange that provided order
routing, handling, and execution for eligible options orders routed
electronically to the Exchange. The LOU System is no longer used, as
all options trading on the Exchange trade on the Hybrid Trading System.
Therefore, the LOU System no longer applies to any options listed for
trading on the Exchange.
Rule 6.13B--Penny Price Improvement. Pursuant to Rule
6.13B, the Exchange may designate one or more options trading on the
Hybrid Trading System in a Penny Price Improvement Program, which
allows Trading Permit Holders to provide price improvement beyond the
Exchange's disseminated quote for classes not already quoted in penny
increments and for which the simple auction liaison system is not in
effect. The Exchange currently has not designated, and has no intention
to designate, any options for participation in this program. Therefore,
this program no longer applies to any options listed for trading on the
Exchange.\9\
---------------------------------------------------------------------------
\9\ The proposed rule change makes corresponding changes to the
following rules to delete references to the Penny Price Improvement
Program and the rules proposed to be deleted: Rules 1.1(fff) and
(ggg), 6.45, Interpretations and Policies .01 and .02, Rule 6.47,
Interpretation and Policy .02, and Rule 6.74, Interpretation and
Policy .09.
---------------------------------------------------------------------------
Rule 6.54(a)--Accommodation Liquidation (Cabinet Trades)
for Classes Not Trading on the Cboe Options Hybrid System. Rule 6.54
describes cabinet trading permitted on the Exchange.
[[Page 6296]]
Paragraph (a) describes cabinet trading for classes not trading on the
Hybrid System, while paragraph (b) describes cabinet trading for
classes trading on the Hybrid System. All options trading on the
Exchange currently trade on the Hybrid Trading System, and thus Rule
6.54(a) no longer applies to any options listed for trading on the
Exchange.\10\
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\10\ The proposed rule change makes a corresponding change to
current paragraph (b), eliminates paragraph lettering for paragraph
(b) (as that will be the only paragraph in the rule), and reletters
subparagraphs (i) and (ii) as (a) and (b), consistent with paragraph
lettering throughout the rules.
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Chapter VII--Order Book Officials. Order Book Officials
were Exchange employees responsible for maintaining the book with
respect to classes assigned to them, effecting proper executions of
orders placed with them, displaying bids and offers, and monitoring the
market for classes assigned to them. The Exchange currently has no
employees designated as, and does not intend to designate any employees
as, Order Book Officials, as Order Book Official functions are
generally obsolete now that most trading occurs electronically.
The proposed rule change deletes Rules 7.1 through 7.3, 7.4 except
for subparagraph (a)(1) (which is being moved to Rule 6.11, with some
modifications described below), 7.5, 7.7 through 7.10, and Chapter VII,
Section B, as they relate solely to responsibilities of Order Book
Officials.
Rule 7.4(a)(1) states public customer orders in Hybrid and Hybrid
3.0 classes are eligible for entry into the electronic book, and the
Exchange may determine on a class-by-class basis other orders that are
eligible for entry into the electronic book. Currently, after a class
is open for trading (see current Rule 6.2B (proposed Rule 6.2) for a
description of orders the System accepts prior to opening), the System
accepts for entry into the Book (1) quotes of all Market-Makers and
orders of any origin code in Hybrid classes and (2) quotes of Lead
Market-Makers (``LMMs'') and orders of priority customers in Hybrid 3.0
classes, while the Exchange continues to have flexibility to permit
orders of other origin codes be eligible for book entry. The Exchange
proposes to codify this current book eligibility (which is consistent
with the Exchange's authority in current Rule 7.4(a)(1)) in Rule 6.11.
The proposed rule change also deletes the provision in current Rule
7.4(a)(1) that states Trading Permit Holders submitting orders or
quotes for entry in to the book must do so electronically and in the
format announced by the Exchange. It is redundant to state orders and
quotes for entry in the electronic book must be submitted
electronically, and Rule 6.53A describes the types of order formats
Trading Permit Holders must use.\11\
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\11\ The proposed rule change makes corresponding changes to the
following rules to change cross-references to Rule 7.4 to Rule 6.11:
Rules 6.13(b)(i)(A)(2) and (iii), 23.3(b), and 24.11A (the proposed
rule change also deletes the Interpretations and Policies section of
this rule, as there are currently none).
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Rule 7.5, Interpretation and Policy .03 states every Floor Broker
who represents a Market-Maker with an order in any options class must,
by public outcry at the post, indicate the identity of such Market-
Maker at the request of any Trading Permit Holder or Order Book
Official. The proposed rule change moves this provision (with the
reference to Order Book Official deleted) to Rule 6.73, which relates
to responsibilities of Floor Brokers.
Rule 7.6 regarding the requirement for PAR Official to report
unusual activity is proposed to move to Rule 6.12B(b)(v).\12\ The
proposed rule change moves currently applicable provisions in Rule 7.12
(regarding PAR Officials) to Rule 6.12B (with some nonsubstantive
changes).\13\ PAR Officials are Exchange employees or independent
contractors whom the Exchange may designate as being responsible for
operating a PAR workstation and effecting proper executions of orders
placed with them. PAR Officials no longer maintain the book with
respect to assigned classes, as the electronic book manages electronic
orders and quotes. The proposed rule change deletes the provision in
current Rule 7.12(b)(i) regarding the definition of customer limit
orders, as customer orders are now defined in Rule 1.1(www) and (yyy)
(which are proposed to be relettered as (yyy) and (zzz), as described
below). The proposed rule change deletes current Rule 7.12(b)(i)(C),
which applies to the Intermarket Options Linkage Plan that no longer
exists.\14\ Pursuant to the current linkage plan, including the
definition of an intermarket sweep order (``ISOs'') in Rule 6.53, ISOs
may only be handled electronically (they may only be entered as
immediate-or-cancel or for book entry if they do not execute), and thus
would never be routed to a PAR workstation under the Rules. Therefore,
PAR Officials no longer have responsibilities with respect to routed
orders under the current linkage plan. The proposed rule change moves
Rule 7.12(b)(i)(E), which relates to orders received during a trading
rotation pursuant to current Rule 6.2 or HOSS pursuant to current Rule
6.2B (proposed Rule 6.2), to proposed Rule 6.12B(b)(i)(D). The proposed
rule change changes the term immediately to promptly, as under current
Rule 7.12 and proposed Rule 6.12(b), the term immediately means as soon
as practicable but within 30 seconds. However, proposed Rule
6.12B(b)(i)(D) exempts these orders from being displayed within 30
seconds, so the term immediate did not seem appropriate. The term
promptly still requires action as soon as practicable, but may be
longer than 30 seconds. The proposed rule change moves current Rule
7.12(b)(ii), (iv), and (v) to proposed Rule 6.12B(b)(ii), (iii), and
(iv), respectively, and moves current Rule 7.12(c) and (d) to proposed
Rule 6.12B(c) and (d), respectively. The proposed rule change deletes
Rule
[[Page 6297]]
7.12(b)(iii), as PAR Officials no longer maintain the book (as
described above) and do not have the ability to remove orders from the
book. The proposed rule change replaces the term ``senior Trading
Operations official'' with ``senior Help Desk personnel'' in current
Rule 7.12(b)(iv) (proposed Rule 6.12(b)(iii)), which term is used
throughout the rules. The proposed rule change deletes Rule 7.12,
Interpretation and Policy .01, as it relates to the Exchange's
responsibility to appoint PAR Officials to trading stations prior to
March 24, 2006. The Exchange currently has PAR Officials appointed to
all trading stations on the trading floor.
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\12\ The proposed rule change makes corresponding changes to the
following rules to delete references to Order Book Officials and the
rules proposed to be deleted: Rules 6.3, Interpretations and
Policies .01 and .02, including the related footnote (these
interpretations also delete references to post directors, which are
no longer used at the Exchange, and only relate to prior
circumstances under which Post Directors or Order Book Officials
would suspend trading; those functions no longer exist on the
Exchange, and the Exchange currently only halts trading in
accordance with the remaining provisions of Rule 6.3 and other rules
related to trading halts), 6.6(b) and (e) (which also deletes
references to post directors, which are no longer used at the
Exchange), 6.12A, 6.20(a) and Interpretations and Policies .02
(currently, there are only four PAR Officials on the trading floor,
who all float to all trading crowds as necessary and are thus no
longer assigned to classes) and .04(ii), 6.43(a), 6.54,
Interpretations and Policies .01 and .02 (the proposed rule change
replaces references to Order Book Officials to PAR Officials,
consistent with Interpretation and Policy .02, which indicates PAR
Officials may perform the functions of Order Book Officials for
purposes of that rule), 6.73, Interpretation and Policy .01 (which
only relates to comparing execution prices to those in displayed by
an Order Book Official (pursuant to Rules 6.45(b) and 6.73, Floor
Brokers must use due diligence to execute orders at the best price
and provide first priority based on price); additionally, bids and
offers are made in response to requests from Floor Brokers that
represent orders in open outcry (see Rule 6.4(b) [sic] and Rule 6.73
contains other provisions that require a Floor Broker to make sure
all persons in the crowd are aware of requests for quotes and use
due diligence when handling and executing orders, making
Interpretation and Policy .01 redundant and unnecessary), 8.7(c)
(the Exchange notes Market-Makers not permitted to enter a trading
station in a floor brokerage capacity, as set forth in Rule 8.8) and
Interpretation and Policy .09 (changes cross-reference to Rule 7.5
to Rule 8.7(d)(iv), which describes current Market-Maker
obligations, including the obligation of Market-Maker to provide a
quote upon Exchange request), and 24.13 and Interpretation and
Policy .03 (which the proposed rule change renumbers to .02).
\13\ The proposed rule change makes corresponding changes to the
following rules to change cross-references to Rule 7.12 to Rule
6.12B: Rules 6.12A, 6.18(d)(i), and 6.20(a).
\14\ Chapter VI, Section E describes Exchange responsibilities
pursuant to the current linkage plan, the Options Order Protection
and Locked/Crossed Market Plan.
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Autoquote. Autoquote was an Exchange electronic quotation
system that automatically monitored and updated market quotes using a
mathematical formula measuring certain characteristics of the option
and underlying interest. Rules related to LMMs and DPMs require them to
provide continuous electronic quotes in appointed classes using
Autoquote or a proprietary automated quotation updating system.
Currently, all Market-Makers that submit electronic quotes use a
proprietary system, and Autoquote is no longer used. The proposed rule
change deletes Rule 8.7, Interpretation and Policy .07, which describes
Autoquote, as well as the requirement of LMMs and DPMs to provide
electronic quotes, which requirement is included in Rules 8.15 and
8.85, respectively.\15\
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\15\ The proposed rule change also deletes references to
Autoquote in Rules 6.43(b), 8.15(c), 8.51(c)(1)(a)(iii), 8.60
Interpretation and Policy .02. Rules 8.7, Interpretation and Policy
.07, 8.15(c), and 8.85(a)(x) provide components of a formula used
for automated quoting by Market-Makers using proprietary automated
quoting systems will be disclosed unless the Exchange exempts them
from disclosing this information. For competitive reasons, the
Exchange exempts all Market-Makers from disclosing this information,
so the proposed rule change deletes those provisions, as it does not
intend to require Market-Makers from disclosing proprietary
information going forward.
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S&P 100 Modified Opening Rotation. Rule 24.13,
Interpretation and Policy .02 provides a modified opening rotation that
the Exchange may use for S&P 100 options, but the rule also provides
the Exchange with the authority to open this class using HOSS pursuant
to current Rule 6.2B (proposed Rule 6.2). The Exchange currently uses
HOSS to open S&P 100 options, and does not intend to use the modified
opening in the future. Therefore, this provision no longer applies to
the opening of S&P 100 options.\16\
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\16\ The proposed rule change also renumbers current
Interpretation and Policy .03 to .02.
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Rule 8.7(c)--Market-Maker Entry into Trading Station in
Unappointed Class other than As Floor Broker. Rule 8.7(c) states
whenever a Market-Maker enters the trading station for a class of
options contracts in a class in which it is not appointed, in other
than a floor brokerage capacity, the Market-Maker must fulfill
obligations established in Rule 8.7(b) and, for the rest of the trading
day, as well as undertake certain additional obligations. This rule
text essentially requires a Market-Maker to act like a Market-Maker
when it enters a trading station in the capacity of a Market-Maker in
an unappointed class. However, pursuant to Rule 8.3, on the trading
floor, Market-Makers have an appointment to trade in all hybrid
classes, so if it goes to any trading station on the floor as a Market-
Maker, it has an appointment for the classes at that station and is
subject to Market-maker obligations. That provision, in conjunction
with the restriction on acting as a Market-Maker and Floor Broker on
the same day, make the provision in Rule 8.7(c) unnecessary and
duplicative. Therefore, the proposed rule change deletes this
provision.
Market-Maker Exemption from Rule 8.7(b)(iv) Obligations.
Rule 8.7, Interpretation and Policy .13 provided Market-Makers with a
temporary exemption from requirements set forth in Rule 8.7(d)(iv) on a
pilot basis until February 17, 2007. That pilot has expired, and the
Exchange did not renew it. Therefore, the proposed rule change deletes
Rule 8.7, Interpretation and Policy .03, as it no longer applies to
trading on the Exchange.
Chapter XXIVA--Flexible Exchange Options (``FLEX
Options''). When the Exchange began offering FLEX Options for trading,
FLEX Options traded pursuant to Rule XXIVA on the trading floor. The
Exchange then developed the FLEX Hybrid Trading System on which FLEX
Options could trade both on the trading floor and electronically.
Chapter XXIVB describes FLEX Options trading on this system, and
provides the Exchange with ability to permit FLEX trading pursuant to
Chapter XXIVA or XXIVB. The open outcry rules in Chapter XXIVA are
substantially similar to those in Chapter XXIVB. The Exchange has
determined all FLEX trading must occur on the FLEX Hybrid Trading
System pursuant to Chapter XXIVB. Therefore, Chapter XXIVA no longer
applies to the trading of any FLEX Options.\17\ The proposed rule
change renumbers Chapter XXIVB and the rules in that chapter to Chapter
XXIVA, and updates cross-references throughout the rules.
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\17\ The proposed rule change also deletes references to Chapter
XXIVA in the following rules: Rules 3.2(b), 5.9, 6.1A(c), 6.24,
Interpretation and Policy .05, 6.49A(c)(6), Introduction to Chapter
XX, 20.12, Introduction to Chapter XXII, 22.16, Introduction to
current Chapter XXIVB, 28.17, 29.18, and Introduction to Chapter
XXIX.
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Chapter XXVI--Market Baskets. Chapter XXVI describes rules
applicable to market basket contracts, which are contracts obligating
the seller to sell and the purchaser to purchase a designated number of
shares of each of the stocks comprising the index on which the market
basket is based. The Exchange currently does not list, and does not
intend to list in the future, market basket contracts for trading.
Therefore, Chapter XXVI no longer applies to any options trading on the
Exchange.\18\
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\18\ The proposed rule change also deletes references to market
baskets and the rules proposed to be deleted in: Rules 8.8,
Interpretation and Policy .02 and 24B.10 (which is proposed to be
renumbered as 24A.10).
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Chapter XXVII--Buy-Write Option Unitary Derivatives
(``BOUNDS''). Chapter XXVIII describes rules applicable to BOUNDS,
which are securities issued, or subject to issuance, by the Options
Clearing Corporation pursuant to its rules, which gives holders and
writers thereof such rights and obligations as may be provided in its
rules. The Exchange currently does not list, and does not intend to
list in the future, BOUNDS for trading. Therefore, Chapter XXVII no
longer applies to any options trading on the Exchange.
Chapter XXXI--Approval of Securities for Original Listing.
Chapter XXXI describes rules pursuant to which the Exchange may list
equity securities for listing on the Exchange. The Exchange currently
does not list any equity securities on the Exchange. Therefore, Chapter
XXXI currently applies to no securities listed on the Exchange.\19\
---------------------------------------------------------------------------
\19\ Options may be listed for trading on the Exchange pursuant
to Chapter V and XXIV. The proposed rule change leaves a placeholder
in Chapters XXX and XXXI for rules related to listing and trading of
equity securities. The Exchange would file a proposed rule change to
adopt new rules if it determines to list and trade equity securities
in the future.
---------------------------------------------------------------------------
Pursuant to Section 957 of the Dodd-Frank Act, Section 6(b)(10) of
the Act \20\ requires the rules of each national securities exchange to
prohibit any member that is not the beneficial owner of a security
registered under Section 12 of the Act \21\ from granting a proxy to
vote the security in connection with certain shareholder votes, unless
the beneficial owner of the security has instructed the member to vote
the proxy in accordance with the voting instructions of the beneficial
owner. The
[[Page 6298]]
shareholder votes covered by Section 957 include any vote with respect
to (1) the election of a member of the board of directors of an issuer
(except for a vote with respect to the uncontested election of a member
of the board of directors of any investment company registered under
the Investment Company Act of 1940 (the ``Investment Company Act''),
(2) executive compensation, or (3) any other significant matter, as
determined by the Commission, by rule.\22\
---------------------------------------------------------------------------
\20\ 15 U.S.C. 78f(b)(10).
\21\ 15 U.S.C. 78l.
\22\ 15 U.S.C. 78f(b)(10)(B).
---------------------------------------------------------------------------
Rules 31.82 through 31.88 currently include provisions that cover
these proxy voting requirements with respect to Trading Permit Holders.
However, because this proposed rule change deletes Chapter XXXI, the
proposed rule change adds Rule 4.25 to retain the provisions required
by Section 957. Proposed Rule 4.25 is substantially similar to rules of
other options exchanges.\23\
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\23\ See, e.g., C2 Supplemental Rules to C2 Chapter 4 and Nasdaq
ISE Rule 421.
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Chapters XL through XLIX--Screen-Based Trading. Chapters
XL through XLIX describe trading on the Exchange's screen-based trading
system. The screen-based trading system is no longer used, as all
options trading on the Exchange trade on the Hybrid Trading System.
Therefore, the screen-based trading rules no longer apply to any
options listed for trading on the Exchange.\24\
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\24\ The proposed rule change makes corresponding changes to the
following rules to delete references to screen-based trading and the
rules proposed to be deleted: Rules 1.1(fff) and (ggg), 3.2(b), and
3.3.
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Chapters L through LIV--CBOE Stock Exchange (``CBSX'').
Chapters L through LIV describe trading on CBSX, which is the
Exchange's facility for trading stocks, warrants, IPRs, IPSs, and Trust
Issued Receipts (non-options securities). CBSX ceased market operations
on April 30, 2014. Therefore, the CBSX rules no longer apply to any
trading on the Exchange.\25\ The Exchange would file a proposed rule
change to adopt new rules if it determines to list and trade non-
options securities in the future.
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\25\ The proposed rule change makes corresponding changes to the
following rules to delete references to CBSX and the rules proposed
to be deleted: Rules 3.1A, 3.2(b), 3.3, and 6.20A, Interpretation
and Policy .01.
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Additional Nonsubstantive Changes
In addition to nonsubstantive changes described above, the proposed
rule change makes the following nonsubstantive changes:
The proposed rule change moves Interpretation and Policy
.01 to the definition of Professional in Rule 1.1(ggg) to
Interpretation and Policy .06 to Rule 1.1, so that all Interpretations
and Policies to Rule 1.1 are in the same place.
Currently, there are two paragraphs erroneously lettered
as Rule 1.1(mmm) and (ppp). The proposed rule change corrects this
lettering and updates the paragraph lettering to reflect these
corrections.
The proposed rule change makes updates throughout the
rules to conform paragraph lettering and numbering to other rules, as
well as to reflect deleted rule provisions.
Rule 6.2, Interpretation and Policy .01(b) and (c)
erroneously refer to LMMs as LLMs. The proposed rule change corrects
[sic] those erroneous references.
The proposed rule change amends Rule 6.43(b) to indicate it only
applies to Hybrid 3.0 classes, which is consistent with the current
rule text and current trading practices.
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.\26\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \27\ 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 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 the proposed rule change is consistent with the
Section 6(b)(5) \28\ requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
---------------------------------------------------------------------------
\26\ 15 U.S.C. 78f(b).
\27\ 15 U.S.C. 78f(b)(5).
\28\ Id.
---------------------------------------------------------------------------
In particular, by deleting rules that no longer apply to Cboe
Options trading (which rules have generally not been applicable in
years), and making other nonsubstantive changes to better organize and
more consistently number and letter rules, the rules will more clearly
identify currently applicable rules, which the Exchange believes
removes impediments to and perfects the mechanism of a free and open
market. The Exchange believes the proposed rule change will eliminate
confusion regarding which rules apply to current trading, which
ultimately protects investors and the public interest. The proposed
rule change has no impact on current trading on Cboe Options.
The proposed rule change regarding proxy voting is substantially
similar to C2 Supplemental Rules to C2 Chapter 4 and Nasdaq ISE Rule
421 and consistent with Section 957 of the Dodd-Frank Act.
B. Self-Regulatory Organization's Statement on Burden on Competition
Cboe Options 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. The proposed rule change
deletes rules that no longer apply to Cboe Options trading and makes
other nonsubstantive changes, and thus has no impact on current trading
on Cboe Options. Therefore, the proposed rule change has no impact on
competition. The proposed rule change eliminates confusion with respect
to rules applicable to current trading on Cboe Options.
The proposed rule change regarding proxy voting is substantially
similar to C2 Supplemental Rules to C2 Chapter 4 and Nasdaq ISE Rule
421 and consistent with Section 957 of the Dodd-Frank Act.
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
Because the foregoing proposed rule change does not:
A. Significantly affect the protection of investors or the public
interest;
B. impose any significant burden on competition; and
C. 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 \29\ and
Rule 19b-4(f)(6) \30\ thereunder.\31\
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\29\ 15 U.S.C. 78s(b)(3)(A).
\30\ 17 CFR 240.19b-4(f)(6).
\31\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires a self-regulatory organization to give the Commission
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. The Exchange has satisfied this requirement.
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[[Page 6299]]
A proposed rule change filed under Rule 19b-4(f)(6) normally does
not become operative for 30 days after the date of filing. However,
Rule 19b-4(f)(6)(iii) \32\ permits the Commission to designate a
shorter time if such action is consistent with the protection of
investors and the public interest. The Exchange requests that the
Commission waive the 30-day operative delay. According to the Exchange,
the proposed rule change is consistent with the protection of investors
and the public interest because it eliminates confusion as to the rules
that currently apply to trading on Cboe Options. The Commission
believes that deleting obsolete rules will add clarity and transparency
to the Exchange's rules. Therefore, the Commission finds that waiving
the 30-day operative delay is consistent with the protection of
investors and the public interest. Accordingly, the Commission waives
the 30-day operative delay and designates the proposed rule change
operative upon filing.\33\
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\32\ 17 CFR 240.19b-4(f)(6)(iii).
\33\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such 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 will institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-CBOE-2018-010 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-CBOE-2018-010. 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-CBOE-2018-010 and should be submitted on
or before March 6, 2018.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\34\
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\34\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-02857 Filed 2-12-18; 8:45 am]
BILLING CODE 8011-01-P
