Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Correct an Error in IM-7600-2, 12625-12627 [2018-05792]
Download as PDF
<![CDATA[
Federal Register / Vol. 83, No. 56 / Thursday, March 22, 2018 / Notices
ACTION:
Notice.
The Postal Service gives
notice of filing a request with the Postal
Regulatory Commission to add a
domestic shipping services contract to
the list of Negotiated Service
Agreements in the Mail Classification
Schedule’s Competitive Products List.
DATES: Date of required notice: March
22, 2018.
FOR FURTHER INFORMATION CONTACT:
Elizabeth A. Reed, 202–268–3179.
SUPPLEMENTARY INFORMATION: The
United States Postal Service® hereby
gives notice that, pursuant to 39 U.S.C.
3642 and 3632(b)(3), on March 16, 2018,
it filed with the Postal Regulatory
Commission a USPS Request to Add
Priority Mail Express & Priority Mail
Contract 63 to Competitive Product List.
Documents are available at
www.prc.gov, Docket Nos. MC2018–132,
CP2018–183.
SUMMARY:
Elizabeth A. Reed,
Attorney, Corporate and Postal Business Law.
[FR Doc. 2018–05778 Filed 3–21–18; 8:45 am]
BILLING CODE 7710–12–P
SECURITIES AND EXCHANGE
COMMISSION
Submission for OMB Review;
Comment Request
Upon Written Request Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736
daltland on DSKBBV9HB2PROD with NOTICES
Extension:
Rule 12g3–2, SEC File No. 270–104, OMB
Control No. 3235–0119
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.) the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget this
request for extension of the previously
approved collection of information
discussed below.
Rule 12g3–2 (17 CFR 240.12g3–2)
under the Securities Exchange Act of
1934 (the ‘‘Exchange Act’’) provides an
exemption from Section 12(g) of the
Exchange Act (15 U.S.C. 78l(g)) for
foreign private issuers. Rule 12g3–2 is
designed to provide investors in foreign
securities with information about such
securities and the foreign issuer. As a
condition to the exemption, a nonExchange Act reporting foreign private
issuer must publish in English specified
non-U.S. disclosure documents required
by Rule 12g3–2(b) for its most recently
VerDate Sep<11>2014
19:32 Mar 21, 2018
Jkt 244001
12625
completed fiscal year on its internet
website or through an electronic
information delivery system in its
primary trading market. In addition, the
rule requires a foreign private issuer
similarly to publish electronically
specified non-U.S. disclosure
documents in English on an ongoing
basis for subsequent fiscal years as a
condition to maintaining the Rule 12g3–
2(b) exemption. We estimate that, that
approximately 1,386 respondents claim
the exemption. Each respondent
publishes an estimated 12 submissions
pursuant to Rule 12g3–2 per year for a
total of 16,632 responses. We estimate
the number of burden hours incurred by
foreign private issuers to produce the
Rule 12g3–2(b) publications to total
37,206, or approximately 2.237 burden
hours per response (2.237 hours per
response × 16,632 responses).
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid
control number.
The public may view the background
documentation for this information
collection at the following website,
www.reginfo.gov. Comments should be
directed to: (i) Desk Officer for the
Securities and Exchange Commission,
Office of Information and Regulatory
Affairs, Office of Management and
Budget, Room 10102, New Executive
Office Building, Washington, DC 20503,
or by sending an email to: Shagufta_
Ahmed@omb.eop.gov; and (ii) Pamela
Dyson, Director/Chief Information
Officer, Securities and Exchange
Commission, c/o Remi PavlikSimon,100 F Street NE, Washington, DC
20549 or send an email to: PRA_
Mailbox@sec.gov. Comments must be
submitted to OMB within 30 days of
this notice.
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on March 12,
2018, BOX Options Exchange LLC
(‘‘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
from interested persons.
Dated: March 19, 2018.
Eduardo A. Aleman,
Assistant Secretary.
The purpose of the proposed rule
change is to amend IM–7600–2 to
correct an inadvertent error that was
[sic] subject of a prior rule filing. In
August 2017, the Securities and
Exchange Commission (‘‘SEC’’)
approved BOX’s filing to establish rules
for an open-outcry trading floor.3 The
Exchange notes that it mistakenly
referenced ‘‘Public Customers’’ rather
than ‘‘Customers’’ in IM–7600–2(h)
when establishing these rules.
Under IM–7600–2(h) a Floor Broker
must deliver written notification prior
to entering a tied hedge order on behalf
[FR Doc. 2018–05810 Filed 3–21–18; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–82889; File No. SR–BOX–
2018–09]
Self-Regulatory Organizations; BOX
Options Exchange LLC; Notice of
Filing and Immediate Effectiveness of
a Proposed Rule Change To Correct an
Error in IM–7600–2
March 16, 2018.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
PO 00000
Frm 00066
Fmt 4703
Sfmt 4703
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to correct an
inadvertent error in IM–7600–2. 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
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Securities Exchange Release No. 81292
(August 2, 2017), 82 FR 37144 (August 8, 2017)
(Order Approving SR–BOX–2016–48 as modified by
Amendment Nos. 1 and 2).
2 17
E:\FR\FM\22MRN1.SGM
22MRN1
12626
Federal Register / Vol. 83, No. 56 / Thursday, March 22, 2018 / Notices
of their client. The intent of the rule was
to require Floor Brokers to provide
notice to all clients when entering in a
tied hedge order on their behalf;
however, the term ‘‘Customer’’ was
inadvertently changed to ‘‘Public
Customer’’ in the drafting process.
Under the BOX Rules, the term
‘‘Customer’’ means either a Public
Customer or a broker-dealer,4 whereas
the term ‘‘Public Customer’’ means a
person that is not a broker or dealer in
securities.5 As such, the rule as it is
currently written does not require the
Floor Broker to notify non-Public
Customer clients prior to entering a tied
hedge order on their behalf; which was
not the intent of the rule. The Exchange
believes it is reasonable and appropriate
for all of a Floor Broker’s clients,
regardless of Participant type, to receive
written notice prior to the Floor Broker
entering in a tied hedge order on their
behalf as it will provide transparency to
the client.
Therefore, the Exchange proposes to
replace the term ‘‘Public Customer’’
with the term ‘‘Customer’’ in Rule IM–
7600–2(h). The Exchange believes the
term ‘‘Customer’’ is more appropriate as
broker-dealers should not have been
excluded from the requirements of Rule
IM–7600–2(h) when it was initially
adopted. Additionally, the proposed
correction is similar to the language
used in the rules of another options
exchange.6
The Exchange notes that it is not
proposing to amend any other part of
the tied-hedge rule and the BOX rules
already allow for Floor Brokers to
submit tied hedge orders on behalf of
broker dealers.
daltland on DSKBBV9HB2PROD with NOTICES
2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the Act,7
in general, and Section 6(b)(5) of the
Act,8 in particular, in that it is designed
to protect investors and the public
interest, promote just and equitable
principles of trade, and foster
cooperation and coordination with
persons engaged in facilitating
transactions in securities by correcting
an inadvertent error that was made in
the adoption of the rule. Specifically,
the Exchange proposes to change the
reference from ‘‘Public Customers’’ to
‘‘Customers’’ in Rule IM–7600–2(h). The
4 See
Rule 100(a)(17).
Rule 100(a)(52).
6 See NYSE Arca (‘‘Arca’’) Rule 6.47–O.01(h). The
Exchange’s reading of Arca’s rule is that the term
‘‘customer’’ includes broker-dealers as well as
Public Customers.
7 15 U.S.C. 78f(b).
8 15 U.S.C. 78f(b)(5).
5 See
VerDate Sep<11>2014
19:32 Mar 21, 2018
Jkt 244001
Exchange believes the term ‘‘Customer’’
is more appropriate as broker-dealers
should not have been excluded from the
requirements of Rule IM–7600–2(h)
when it was initially adopted. Further,
the Exchange believes it is reasonable
and appropriate for all of a Floor
Broker’s clients, regardless of
Participant type, to receive written
notice prior to the Floor Broker entering
in a tied hedge order on their behalf.
As noted above, the proposed
correction is similar to the language
used in the rules of another options
exchange.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The proposed rule change will not
impose any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act as the
proposed rule change is simply seeking
to eliminate investor confusion with
regard to the incorrect reference in Rule
IM–7600–2(h). As such, 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.
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, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 9 and subparagraph (f)(6) of
Rule 19b–4 thereunder.10
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 11 normally does not become
operative for 30 days after the date of its
9 15
U.S.C. 78s(b)(3)(A)(iii).
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.
11 17 CFR 240.19b–4(f)(6).
10 17
PO 00000
Frm 00067
Fmt 4703
Sfmt 4703
filing. However, Rule 19b–4(f)(6)(iii) 12
permits the Commission to designate a
shorter time if such action is consistent
with the protection of investors and the
public interest. The Exchange has asked
the Commission to waive the 30-day
operative delay so that the proposal may
become operative immediately upon
filing. The Exchange notes that waiver
of the operative delay would allow it to
implement the proposal immediately
and would require a Floor Broker to
provide written notice to its non-Public
Customer clients, as well as its Public
Customer clients, prior to entering a tied
hedge order on their behalf. The
Commission believes that waiving the
30-day operative delay is consistent
with the protection of investors and the
public interest because the proposed
rule change is designed to provide
clarity and transparency to non-Public
Customers regarding the usage of tied
hedge orders by Floor Brokers and the
Exchange’s tied hedge order procedures.
The Commission also notes that the
proposed rule change does not change
the Exchange’s existing tied hedge rule
that permits Floor Brokers to submit
tied hedge orders on behalf of nonPublic Customers. Rather, the proposed
rule change would simply require Floor
Brokers to provide the same type of
notice to non-Public Customers as is
currently required to be provided to
Public Customers. Accordingly, the
Commission hereby waives the
operative delay and designates the
proposal operative upon filing.13
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: (i) Necessary or appropriate in
the public interest; (ii) for the protection
of investors; or (iii) otherwise in
furtherance of the purposes of the Act.
If the Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
12 17
CFR 240.19b–4(f)(6)(iii).
purposes only of waiving the 30-day
operative delay, the Commission has also
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
13 For
E:\FR\FM\22MRN1.SGM
22MRN1
Federal Register / Vol. 83, No. 56 / Thursday, March 22, 2018 / Notices
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–2018–09 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.
daltland on DSKBBV9HB2PROD with NOTICES
All submissions should refer to File
Number SR–BOX–2018–09. 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–BOX–2018–09 and should
be submitted on or before April 12,
2018.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018–05792 Filed 3–21–18; 8:45 am]
BILLING CODE 8011–01–P
14 17
CFR 200.30–3(a)(12).
VerDate Sep<11>2014
19:32 Mar 21, 2018
Jkt 244001
12627
SECURITIES AND EXCHANGE
COMMISSION
II. Description of the Proposed Rule
Change, as Modified by Amendment
No. 1 6
[Release No. 34–82891; File No. SR–BOX–
2017–36]
BOX proposes to adopt Rule 7600(i),
which would establish priority
principles for split-price transactions
occurring in open-outcry on the Trading
Floor.7 Under the proposed rule, if an
order or offer (bid) for any number of
contracts of a series is represented to the
trading crowd, a Floor Participant 8 that
buys (sells) one or more contracts of that
order or offer (bid) at one price would
have priority over all other orders and
quotes, except Public Customer Orders 9
resting in the BOX Book,10 to buy (sell)
up to the same number of contracts of
those remaining from the same order or
offer (bid) at the next lower (higher)
price.11 For orders or offers (bids) of 100
or more contracts,12 a Floor Participant
that buys (sells) 50 or more of the
contracts of that order or offer (bid) at
a particular price will have priority over
all other orders and quotes to buy (sell)
up to the same number of contracts of
those remaining from the same order or
offer (bid) at the next lower (higher)
price.13 If the bids or offers of two or
more Floor Participants are both entitled
to split-price priority, priority would be
afforded (to the extent practicable) on a
pro-rata basis.14
According to the Exchange, in order
to execute a split-price transaction, a
Floor Broker would submit a Qualified
Open Outcry (‘‘QOO’’) Order to the
system in the same manner as done
today on the Trading Floor, except that
the QOO Order would be entered at a
sub-minimum trading increment.15
Self-Regulatory Organizations; BOX
Options Exchange LLC; Notice of
Filing of Amendment No. 1 and Order
Granting Accelerated Approval of a
Proposed Rule Change, as Modified by
Amendment No. 1, To Adopt Rule
7600(i) To Allow Split-Price
Transactions on the BOX Trading Floor
March 16, 2018.
I. Introduction
On November 30, 2017, BOX Options
Exchange LLC (the ‘‘Exchange’’ or
‘‘BOX’’) filed with the Securities and
Exchange Commission (‘‘Commission’’),
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a
proposed rule change to adopt proposed
Rule 7600(i) to allow split-price
transactions on the BOX Trading Floor.
The proposed rule change was
published for comment in the Federal
Register on December 19, 2017.3 On
January 31, 2018, the Commission
extended the time period within which
to approve the proposed rule change,
disapprove the proposed rule change, or
institute proceedings to determine
whether to disapprove the proposed
rule change to March 19, 2018.4 The
Exchange filed Amendment No. 1 to the
proposal on March 7, 2018.5 The
Commission is publishing this notice to
solicit comment on Amendment No. 1
to the proposed rule change from
interested persons and is approving the
proposed rule change, as modified by
Amendment No. 1, on an accelerated
basis.
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Securities Exchange Act Release No. 82315
(December 13, 2017), 82 FR 60256 (‘‘Notice’’).
4 See Securities Exchange Act Release No. 82607
(January 31, 2018), 83 FR 5286 (February 6, 2018).
5 In Amendment No. 1 the Exchange: (1) Further
described how split-price priority transactions
would execute if there is Public Customer interest
on the BOX Book; (2) provided additional
justification for the proposal being consistent with
the Act; (3) provided additional examples of how
split-price priority transactions will be handled and
reported by the Exchange; and (4) proposed
additional rule text to describe how the system will
determine the allocation of a split-price QOO Order
in situations where the allocation between two
increments results in a fractional amount of
contracts and provided justification for this change.
Amendment No. 1 is available at: https://
www.sec.gov/comments/sr-box-2017-36/box2017363206059-161998.pdf.
2 17
PO 00000
Frm 00068
Fmt 4703
Sfmt 4703
6 For a more detailed description of the proposed
rule change, see Notice, supra note 3; Amendment
No. 1, supra note 5.
7 See Rule 100(a)(67) (defining Trading Floor).
8 The term ‘‘Floor Participant’’ includes Floor
Brokers as defined in Rule 7540 and Floor Market
Makers as defined in Rule 8510(b). See Rule
100(a)(26).
9 The term ‘‘Public Customer Order’’ means an
order for the account of a Public Customer, which
is defined in the BOX Rules as a person that is not
a broker or dealer in securities. See Rules 100(a)(52)
and (53).
10 The term ‘‘Central Order Book’’ or ‘‘BOX Book’’
means the electronic book of orders on each single
option series maintained by the BOX Trading Host.
See Rule 100(a)(10).
11 See proposed Rule 7600(i)(1).
12 Under the proposed rule, the Exchange would
be permitted to increase the minimum qualifying
size of 100 contracts. Any such changes would be
announced to Participants via Regulatory Circular.
See proposed Rule 7600(i)(2).
13 See proposed Rule 7600(i)(2). See also Notice
supra, note 3, at 60257 (providing an example of
a split-price transaction for 100 contracts).
14 See proposed Rule 7600(i)(3).
15 For example, a Floor Broker would be
permitted to enter a QOO Order at a price of $1.03
when the minimum trading increment for the series
E:\FR\FM\22MRN1.SGM
Continued
22MRN1
]]>Agencies
[Federal Register Volume 83, Number 56 (Thursday, March 22, 2018)]
[Notices]
[Pages 12625-12627]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-05792]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-82889; File No. SR-BOX-2018-09]
Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Correct an Error in IM-7600-2
March 16, 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 March 12, 2018, BOX Options Exchange LLC (``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 from
interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to correct an inadvertent error in IM-7600-2.
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 purpose of the proposed rule change is to amend IM-7600-2 to
correct an inadvertent error that was [sic] subject of a prior rule
filing. In August 2017, the Securities and Exchange Commission
(``SEC'') approved BOX's filing to establish rules for an open-outcry
trading floor.\3\ The Exchange notes that it mistakenly referenced
``Public Customers'' rather than ``Customers'' in IM-7600-2(h) when
establishing these rules.
---------------------------------------------------------------------------
\3\ See Securities Exchange Release No. 81292 (August 2, 2017),
82 FR 37144 (August 8, 2017) (Order Approving SR-BOX-2016-48 as
modified by Amendment Nos. 1 and 2).
---------------------------------------------------------------------------
Under IM-7600-2(h) a Floor Broker must deliver written notification
prior to entering a tied hedge order on behalf
[[Page 12626]]
of their client. The intent of the rule was to require Floor Brokers to
provide notice to all clients when entering in a tied hedge order on
their behalf; however, the term ``Customer'' was inadvertently changed
to ``Public Customer'' in the drafting process. Under the BOX Rules,
the term ``Customer'' means either a Public Customer or a broker-
dealer,\4\ whereas the term ``Public Customer'' means a person that is
not a broker or dealer in securities.\5\ As such, the rule as it is
currently written does not require the Floor Broker to notify non-
Public Customer clients prior to entering a tied hedge order on their
behalf; which was not the intent of the rule. The Exchange believes it
is reasonable and appropriate for all of a Floor Broker's clients,
regardless of Participant type, to receive written notice prior to the
Floor Broker entering in a tied hedge order on their behalf as it will
provide transparency to the client.
---------------------------------------------------------------------------
\4\ See Rule 100(a)(17).
\5\ See Rule 100(a)(52).
---------------------------------------------------------------------------
Therefore, the Exchange proposes to replace the term ``Public
Customer'' with the term ``Customer'' in Rule IM-7600-2(h). The
Exchange believes the term ``Customer'' is more appropriate as broker-
dealers should not have been excluded from the requirements of Rule IM-
7600-2(h) when it was initially adopted. Additionally, the proposed
correction is similar to the language used in the rules of another
options exchange.\6\
---------------------------------------------------------------------------
\6\ See NYSE Arca (``Arca'') Rule 6.47-O.01(h). The Exchange's
reading of Arca's rule is that the term ``customer'' includes
broker-dealers as well as Public Customers.
---------------------------------------------------------------------------
The Exchange notes that it is not proposing to amend any other part
of the tied-hedge rule and the BOX rules already allow for Floor
Brokers to submit tied hedge orders on behalf of broker dealers.
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act,\7\ in general, and Section
6(b)(5) of the Act,\8\ in particular, in that it is designed to protect
investors and the public interest, promote just and equitable
principles of trade, and foster cooperation and coordination with
persons engaged in facilitating transactions in securities by
correcting an inadvertent error that was made in the adoption of the
rule. Specifically, the Exchange proposes to change the reference from
``Public Customers'' to ``Customers'' in Rule IM-7600-2(h). The
Exchange believes the term ``Customer'' is more appropriate as broker-
dealers should not have been excluded from the requirements of Rule IM-
7600-2(h) when it was initially adopted. Further, the Exchange believes
it is reasonable and appropriate for all of a Floor Broker's clients,
regardless of Participant type, to receive written notice prior to the
Floor Broker entering in a tied hedge order on their behalf.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
As noted above, the proposed correction is similar to the language
used in the rules of another options exchange.
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change will not impose any burden on competition
not necessary or appropriate in furtherance of the purposes of the Act
as the proposed rule change is simply seeking to eliminate investor
confusion with regard to the incorrect reference in Rule IM-7600-2(h).
As such, 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.
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, the proposed rule
change has become effective pursuant to Section 19(b)(3)(A) of the Act
\9\ and subparagraph (f)(6) of Rule 19b-4 thereunder.\10\
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78s(b)(3)(A)(iii).
\10\ 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.
---------------------------------------------------------------------------
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \11\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \12\ permits the
Commission to designate a shorter time if such action is consistent
with the protection of investors and the public interest. The Exchange
has asked the Commission to waive the 30-day operative delay so that
the proposal may become operative immediately upon filing. The Exchange
notes that waiver of the operative delay would allow it to implement
the proposal immediately and would require a Floor Broker to provide
written notice to its non-Public Customer clients, as well as its
Public Customer clients, prior to entering a tied hedge order on their
behalf. The Commission believes that waiving the 30-day operative delay
is consistent with the protection of investors and the public interest
because the proposed rule change is designed to provide clarity and
transparency to non-Public Customers regarding the usage of tied hedge
orders by Floor Brokers and the Exchange's tied hedge order procedures.
The Commission also notes that the proposed rule change does not change
the Exchange's existing tied hedge rule that permits Floor Brokers to
submit tied hedge orders on behalf of non-Public Customers. Rather, the
proposed rule change would simply require Floor Brokers to provide the
same type of notice to non-Public Customers as is currently required to
be provided to Public Customers. Accordingly, the Commission hereby
waives the operative delay and designates the proposal operative upon
filing.\13\
---------------------------------------------------------------------------
\11\ 17 CFR 240.19b-4(f)(6).
\12\ 17 CFR 240.19b-4(f)(6)(iii).
\13\ For purposes only of waiving the 30-day operative delay,
the Commission has also considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule change should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
[[Page 12627]]
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-2018-09 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-BOX-2018-09. 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-BOX-2018-09 and should be submitted on
or before April 12, 2018.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
---------------------------------------------------------------------------
\14\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-05792 Filed 3-21-18; 8:45 am]
BILLING CODE 8011-01-P
