Securities Exchange Act of 1934, 11850-11852 [2019-05912]
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Federal Register / Vol. 84, No. 60 / Thursday, March 28, 2019 / Notices
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
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 after the date of
the filing, or such shorter time as the
Commission may designate, it has
become effective pursuant to 19(b)(3)(A)
of the Act 14 and Rule 19b–4(f)(6) 15
thereunder.
A proposed rule change filed under
Rule 19b–4(f)(6) normally does not
become operative for 30 days after the
date of the filing. However, Rule 19b–
4(f)(6)(iii) 16 permits the Commission to
designate a shorter time if such action
is consistent with the protection of
investors and the public interest. In its
filing, MIAX PEARL requested that the
Commission waive the 30-day operative
delay. The Exchange represented that
the proposal establishes a rule regarding
the give up of a Clearing Member in
order to help clearing firms manage risk
while continuing to allow market
participants choice in broker execution
services. The Commission notes that it
recently approved a substantially
similar proposed rule change by Nasdaq
Phlx LLC.17 The Commission believes
that waiver of the 30-day operative
delay is consistent with the protection
of investors and the public interest, as
such waiver will provide transparency
and operational certainty including
through the use of a standardized give
up process and would align the give up
process with other option exchanges.
Accordingly, the Commission waives
the 30-day operative delay and
designates the proposed rule change
operative upon filing.18
14 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6) requires a self-regulatory organization to give
the Commission written notice of its intent to file
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.
16 17 CFR 240.19b–4(f)(6)(iii).
17 See supra note 5.
18 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).
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At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
PEARL–2019–04 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–PEARL–2019–04. 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
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personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–PEARL–2019–04 and
should be submitted on or before April
18, 2019.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.19
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019–05923 Filed 3–27–19; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 85399]
Securities Exchange Act of 1934
March 22, 2019.
In the Matter of: The BOX Exchange LLC;
Regarding a Suspension of and Order
Instituting Proceedings to Determine
Whether to Approve or Disapprove a
Proposed Rule Change to Amend the Fee
Schedule on the BOX Market LLC Options
Facility to Establish BOX Connectivity Fees
for Participants and Non-Participants Who
Connect to the BOX Network (File No. SR–
BOX–2019–04); Order Granting BOX
Exchange LLC’s Petition for Review of
Division of Trading and Markets Order by
Delegated Authority Temporarily Suspending
and Instituting Proceedings on SR–BOX–
2019–04; Affirming the Division’s Order; and
Lifting the Automatic Stay.
I. Background
On February 13, 2019, BOX Exchange
LLC (‘‘BOX’’ or the ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change
(SR–BOX–2019–04) (‘‘BOX 3’’) to
amend the fee schedule on the BOX
Market LLC options facility to establish
certain connectivity fees and reclassify
its high speed vendor feed connection
as a port fee. On February 26, 2019, the
Division of Trading and Markets
(‘‘Division’’), acting pursuant to
delegated authority,3 issued a notice of
the proposed rule change and order
temporarily suspending the proposed
rule change pursuant to Section
19(b)(3)(C) of the Act and
simultaneously instituting proceedings
under Section 19(b)(2)(B) of the Act to
determine whether to approve or
19 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 17 CFR 200.30–3(a)(12), (57) and (58).
1 15
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Federal Register / Vol. 84, No. 60 / Thursday, March 28, 2019 / Notices
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disapprove the proposed rule change.4
The Commission received one comment
letter on the proposal supporting the
suspension and institution of
proceedings.5
On February 26, 2019, pursuant to
Rule 430 of the Commission’s Rules of
Practice,6 the Exchange filed a notice of
intention to petition for review of the
Order Instituting Proceedings. Pursuant
to Rule 431(e) of the Commission’s
Rules of Practice,7 a notice of intention
to petition for review results in an
automatic stay of the action by
delegated authority. On March 5, 2019,
the Exchange filed a petition for review
of the Order Instituting Proceedings.8
The proposed fees in the proposed
rule change are identical to those
proposed in two prior BOX proposed
rule changes, both of which were
similarly suspended by delegated
authority.9 The Forms 19b-4 for all three
filings are substantively identical,
except SR–BOX–2018–37 (‘‘BOX 2’’)
and BOX 3 identify the broad categories
of the Exchange’s costs to offer
connectivity services and state that the
proposed fees would ‘‘offset’’ the
Exchange’s costs.
As with the instant proposal, the
Exchange challenged the Division’s
delegated authority to suspend and
institute proceedings on BOX 1.10 On
November 16, 2018, the Commission
granted the Exchange’s petition to
review BOX 1 and discontinued the
automatic stay of the delegated action.11
On February 25, 2019, the Commission
issued an order affirming the action by
4 See Securities Exchange Act Release No. 85201,
84 FR 7146 (March 1, 2019) (‘‘Order Instituting
Proceedings’’).
5 See letter from Theodore R. Lazo, Managing
Director and Associate General Counsel, Securities
Industry and Financial Markets Association, to
Vanessa Countryman, Acting Secretary,
Commission, dated March 12, 2019.
6 17 CFR 201.430.
7 17 CFR 201.431(e).
8 Petition for Review of Order Temporarily
Suspending BOX Exchange LLC’s Proposal to
Amend the Fee Schedule on BOX Market LLC,
dated March 5, 2019 (‘‘Petition’’).
9 See Securities Exchange Act Release Nos. 84168
(September 17, 2018), 83 FR 47947 (September 21,
2018) (SR–BOX–2018–24) (‘‘BOX 1’’) and 84823
(December 14, 2018), 83 FR 65381 (December 20,
2018) (SR–BOX–2018–37) (‘‘BOX 2’’).
10 See letter from Amir C. Tayrani, Partner,
Gibson, Dunn & Crutcher LLP, to Brent J. Fields,
Secretary, Commission, dated September 19, 2018;
Petition for Review of Order Temporarily
Suspending BOX Exchange LLC’s Proposal to
Amend the Fee Schedule on BOX Market LLC,
dated September 26, 2018. The Commission notes
that the Exchange did not challenge the Division’s
action by delegated authority to suspend and
institute proceedings on BOX 2.
11 See Securities Exchange Act Release No. 84614
(November 16, 2018), 83 FR 59432 (November 23,
2018).
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delegated authority in BOX 1.12 The
Order Affirming the BOX 1 OIP also reopened the comment and rebuttal
periods for BOX 1 to March 8, 2019 and
March 15, 2019, respectively.
II. Discussion
Pursuant to Rule 431 of the
Commission Rules of Practice,13 the
Exchange’s Petition is granted. The
Commission is not providing for a time
period during which any party to the
action or other person may file a written
statement in support of or in opposition
to the Order Instituting Proceedings.14
The Commission believes that the issues
raised by the Exchange’s Petition were
presented during the course of the
Commission’s review of the Exchange’s
petition to review the delegated action
in BOX 1 temporarily suspending and
instituting proceedings, in which two
statements were received and
considered by the Commission in its
order affirming the delegated action.15
The Commission therefore does not
believe the Petition presents any new
issues that would benefit from an
additional period for written statement
and believes that no time period for the
filing of statements is necessary for this
review.
The Commission’s Rules of Practice
set forth procedures for the review of
actions made pursuant to delegated
authority. Rule 431(a) provides that the
Commission may affirm, reverse,
modify, set aside, or remand for further
proceedings, in whole or in part, any
action made pursuant to authority
delegated in 17 CFR 200.30–1 through
200.30–18.16 For the reasons discussed
below, the Commission affirms the
temporary suspension of the proposed
rule change and the institution of
proceedings.
Instituting proceedings and keeping
in place the temporary suspension
provides a process for the Commission
to further consider whether the
proposed rule change is consistent with
the statutory requirements applicable to
a national securities exchange under the
Act. In particular, this approach will
allow the Commission to consider
whether the proposed rule change
satisfies the standards under the Act
and the rules thereunder requiring,
12 See Securities Exchange Act Release No. 85184,
84 FR 6842 (February 28, 2019) (‘‘Order Affirming
SR–BOX–2018–24 OIP’’).
13 17 CFR 201.431.
14 17 CFR 201.100(c).
15 See Order Affirming SR–BOX–2018–24 OIP,
supra note 12. See also letters to Brent J. Fields,
Secretary, Commission, from Lisa J. Fall, President,
BOX, dated December 7, 2018 and Amir C. Tayrani,
Gibson, Dunn & Crutcher LLP, dated December 10,
2018.
16 See 17 CFR 201.431(a).
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11851
among other things, that (i) an
exchange’s rules provide for the
equitable allocation of reasonable fees
among members, issuers, and other
persons using its facilities; (ii) do not
permit unfair discrimination between
customers, issuers, brokers, or dealers;
and (iii) do not impose any burden on
competition not necessary or
appropriate in furtherance of the
purposes of the Act.17 Accordingly, the
Order Instituting Proceedings properly
concluded that it was appropriate in the
public interest, for the protection of
investors, and otherwise in furtherance
of the purposes of the Act to temporarily
suspend the proposed rule change and
to institute proceedings to determine
whether the proposed rule change
should be approved or disapproved in
view of the significant legal and policy
issues raised by the proposal.18
Further, suspending the filing and
instituting proceedings constitutes an
interim step in the Commission’s
consideration of the substantive issues
raised by the filing, and does not
constitute a final disposition of the
proposed rule change. As reflected in
the Order Instituting Proceedings, the
Commission has not reached any
conclusions with respect to the issues
involved.19 To the contrary, the
Commission sought additional comment
with respect to the concerns raised by
the filing,20 and noted that the
institution of proceedings provides the
Commission the opportunity to more
fully assess the issues raised.
As noted above, during the
proceedings the Commission will
consider whether the proposal satisfies
the standards under the Act and the
rules thereunder requiring, among other
things, that an exchange’s rules provide
for the equitable allocation of reasonable
fees among members, issuers, and other
persons using its facilities; not permit
unfair discrimination between
customers, issuers, brokers or dealers;
and do not impose any burden on
competition not necessary or
appropriate in furtherance of the
purposes of the Act.
Further, the Commission finds that it
is in the public interest to lift the stay
during the pendency of the
Commission’s review. The Commission
believes the continued suspension of
the proposed rule change while the
Commission conducts proceedings to
consider the Exchange’s proposal will
allow the Commission to further
17 See Order Instituting Proceedings, supra note 4,
at 7150.
18 See id.
19 See id.
20 See id.
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Federal Register / Vol. 84, No. 60 / Thursday, March 28, 2019 / Notices
consider the proposed fees’ consistency
with the Exchange Act without the risk
of allowing a fee that is potentially
inconsistent with the Exchange Act to
remain in effect. The Commission also
does not believe that lifting the stay
precludes meaningful review of the
Order Instituting Proceedings.
For the reasons stated above, it is
hereby:
Ordered that the Exchange’s petition
for review of the Division’s action, by
delegated authority, temporarily
suspending the proposed rule change
and simultaneously instituting
proceedings to determine whether to
approve or disapprove the proposed
rule change be granted; and
It is further ordered that the Division’s
Order Instituting Proceedings by
delegated authority is hereby affirmed;
and
It is further ordered that the automatic
stay of delegated action pursuant to
Commission Rule of Practice 431(e) 21 is
hereby discontinued.
The order temporarily suspending
such proposed rule change and
instituting proceedings to determine
whether to approve or disapprove such
proposed rule change shall remain in
effect.
By the Commission.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019–05912 Filed 3–27–19; 8:45 am]
BILLING CODE P
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration #15896 and #15897;
NEBRASKA Disaster Number NE–00073]
Presidential Declaration of a Major
Disaster for the State of Nebraska
U.S. Small Business
Administration.
ACTION: Notice.
AGENCY:
This is a Notice of the
Presidential declaration of a major
disaster for the State of Nebraska
(FEMA–4420–DR), dated 03/21/2019.
Incident: Severe Winter Storm,
Straight-line Winds, and Flooding.
Incident Period: 03/09/2019 and
continuing.
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A.
Escobar, Office of Disaster Assistance,
U.S. Small Business Administration,
409 3rd Street SW, Suite 6050,
Washington, DC 20416, (202) 205–6734.
FOR FURTHER INFORMATION CONTACT:
Notice is
hereby given that as a result of the
President’s major disaster declaration on
03/21/2019, applications for disaster
loans may be filed at the address listed
above or other locally announced
locations.
The following areas have been
determined to be adversely affected by
the disaster:
SUPPLEMENTARY INFORMATION:
Issued on 03/21/2019.
Physical Loan Application Deadline
Date: 05/20/2019.
Economic Injury (EIDL) Loan
Application Deadline Date: 12/23/2019.
ADDRESSES: Submit completed loan
applications to: U.S. Small Business
CFR 201.431(e).
VerDate Sep<11>2014
21:15 Mar 27, 2019
2.750
4.000
[Disaster Declaration #15874 and #15875;
MISSISSIPPI Disaster Number MS–00109]
Presidential Declaration Amendment of
a Major Disaster for Public Assistance
Only for the State of Mississippi
U.S. Small Business
Administration.
ACTION: Amendment 1.
AGENCY:
Frm 00114
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(Catalog of Federal Domestic Assistance
Number 59008)
Rafaela Monchek,
Acting Associate Administrator for Disaster
Assistance.
[FR Doc. 2019–05941 Filed 3–27–19; 8:45 am]
BILLING CODE 8025–01–P
Rafaela Monchek,
Acting Associate Administrator for Disaster
Assistance.
PO 00000
SUMMARY:
2.750
(Catalog of Federal Domestic Assistance
Number 59008)
BILLING CODE 8025–01–P
Jkt 247001
2.750
The number assigned to this disaster
for physical damage is 158966 and for
economic injury is 158970.
[FR Doc. 2019–05942 Filed 3–27–19; 8:45 am]
21 17
SMALL BUSINESS ADMINISTRATION
This is an amendment of the
Presidential declaration of a major
disaster for Public Assistance Only for
the State of Mississippi (FEMA–4415–
DR), dated 02/14/2019.
Incident: Severe Storms, Flooding,
and Tornado.
Incident Period: 12/27/2018 through
Primary Counties (Physical Damage and 12/28/2018.
Economic Injury Loans): Butler,
DATES: Issued on 03/20/2019.
Cass, Colfax, Dodge, Douglas,
Physical Loan Application Deadline
Nemaha, Sarpy, Saunders,
Date: 04/15/2019.
Washington.
Economic Injury (EIDL) Loan
Contiguous Counties (Economic Injury
Application Deadline Date: 11/14/2019.
Loans Only):
ADDRESSES: Submit completed loan
applications to: U.S. Small Business
Nebraska: Burt, Cuming, Johnson,
Administration, Processing and
Lancaster, Otoe, Pawnee, Platte,
Polk, Richardson, Seward, Stanton, Disbursement Center, 14925 Kingsport
Road, Fort Worth, TX 76155.
York.
FOR FURTHER INFORMATION CONTACT: A.
Iowa: Fremont, Harrison, Mills,
Escobar, Office of Disaster Assistance,
Pottawattamie.
U.S. Small Business Administration,
Missouri: Atchison, Holt.
409 3rd Street SW, Suite 6050,
The Interest Rates are:
Washington, DC 20416, (202) 205–6734.
SUPPLEMENTARY INFORMATION: The notice
Percent
of the President’s major disaster
declaration for Private Non-Profit
For Physical Damage:
organizations in the State of Mississippi,
Homeowners with Credit Available Elsewhere ........................
4.125 dated 02/14/2019, is hereby amended to
Homeowners
without
Credit
include the following areas as adversely
Available Elsewhere ................
2.063 affected by the disaster.
Businesses with Credit Available
Primary Counties: Noxubee.
Elsewhere ................................
8.000
All other information in the original
Businesses without Credit Available Elsewhere ........................
4.000 declaration remains unchanged.
Non-Profit Organizations with
Credit Available Elsewhere .....
Non-Profit Organizations without
Credit Available Elsewhere .....
For Economic Injury:
Businesses & Small Agricultural
Cooperatives without Credit
Available Elsewhere ................
Non-Profit Organizations without
Credit Available Elsewhere .....
SUMMARY:
DATES:
Administration, Processing and
Disbursement Center, 14925 Kingsport
Road, Fort Worth, TX 76155.
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration #15884 and #15885;
KANSAS Disaster Number KS–00122]
Presidential Declaration Amendment of
a Major Disaster for Public Assistance
Only for the State of Kansas
U.S. Small Business
Administration.
ACTION: Amendment 1.
AGENCY:
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]]>Agencies
[Federal Register Volume 84, Number 60 (Thursday, March 28, 2019)]
[Notices]
[Pages 11850-11852]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-05912]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 85399]
Securities Exchange Act of 1934
March 22, 2019.
In the Matter of: The BOX Exchange LLC; Regarding a Suspension
of and Order Instituting Proceedings to Determine Whether to Approve
or Disapprove a Proposed Rule Change to Amend the Fee Schedule on
the BOX Market LLC Options Facility to Establish BOX Connectivity
Fees for Participants and Non-Participants Who Connect to the BOX
Network (File No. SR-BOX-2019-04); Order Granting BOX Exchange LLC's
Petition for Review of Division of Trading and Markets Order by
Delegated Authority Temporarily Suspending and Instituting
Proceedings on SR-BOX-2019-04; Affirming the Division's Order; and
Lifting the Automatic Stay.
I. Background
On February 13, 2019, BOX Exchange LLC (``BOX'' or the
``Exchange'') filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) of the Securities
Exchange Act (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed
rule change (SR-BOX-2019-04) (``BOX 3'') to amend the fee schedule on
the BOX Market LLC options facility to establish certain connectivity
fees and reclassify its high speed vendor feed connection as a port
fee. On February 26, 2019, the Division of Trading and Markets
(``Division''), acting pursuant to delegated authority,\3\ issued a
notice of the proposed rule change and order temporarily suspending the
proposed rule change pursuant to Section 19(b)(3)(C) of the Act and
simultaneously instituting proceedings under Section 19(b)(2)(B) of the
Act to determine whether to approve or
[[Page 11851]]
disapprove the proposed rule change.\4\ The Commission received one
comment letter on the proposal supporting the suspension and
institution of proceedings.\5\
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 17 CFR 200.30-3(a)(12), (57) and (58).
\4\ See Securities Exchange Act Release No. 85201, 84 FR 7146
(March 1, 2019) (``Order Instituting Proceedings'').
\5\ See letter from Theodore R. Lazo, Managing Director and
Associate General Counsel, Securities Industry and Financial Markets
Association, to Vanessa Countryman, Acting Secretary, Commission,
dated March 12, 2019.
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On February 26, 2019, pursuant to Rule 430 of the Commission's
Rules of Practice,\6\ the Exchange filed a notice of intention to
petition for review of the Order Instituting Proceedings. Pursuant to
Rule 431(e) of the Commission's Rules of Practice,\7\ a notice of
intention to petition for review results in an automatic stay of the
action by delegated authority. On March 5, 2019, the Exchange filed a
petition for review of the Order Instituting Proceedings.\8\
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\6\ 17 CFR 201.430.
\7\ 17 CFR 201.431(e).
\8\ Petition for Review of Order Temporarily Suspending BOX
Exchange LLC's Proposal to Amend the Fee Schedule on BOX Market LLC,
dated March 5, 2019 (``Petition'').
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The proposed fees in the proposed rule change are identical to
those proposed in two prior BOX proposed rule changes, both of which
were similarly suspended by delegated authority.\9\ The Forms 19b-4 for
all three filings are substantively identical, except SR-BOX-2018-37
(``BOX 2'') and BOX 3 identify the broad categories of the Exchange's
costs to offer connectivity services and state that the proposed fees
would ``offset'' the Exchange's costs.
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\9\ See Securities Exchange Act Release Nos. 84168 (September
17, 2018), 83 FR 47947 (September 21, 2018) (SR-BOX-2018-24) (``BOX
1'') and 84823 (December 14, 2018), 83 FR 65381 (December 20, 2018)
(SR-BOX-2018-37) (``BOX 2'').
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As with the instant proposal, the Exchange challenged the
Division's delegated authority to suspend and institute proceedings on
BOX 1.\10\ On November 16, 2018, the Commission granted the Exchange's
petition to review BOX 1 and discontinued the automatic stay of the
delegated action.\11\ On February 25, 2019, the Commission issued an
order affirming the action by delegated authority in BOX 1.\12\ The
Order Affirming the BOX 1 OIP also re-opened the comment and rebuttal
periods for BOX 1 to March 8, 2019 and March 15, 2019, respectively.
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\10\ See letter from Amir C. Tayrani, Partner, Gibson, Dunn &
Crutcher LLP, to Brent J. Fields, Secretary, Commission, dated
September 19, 2018; Petition for Review of Order Temporarily
Suspending BOX Exchange LLC's Proposal to Amend the Fee Schedule on
BOX Market LLC, dated September 26, 2018. The Commission notes that
the Exchange did not challenge the Division's action by delegated
authority to suspend and institute proceedings on BOX 2.
\11\ See Securities Exchange Act Release No. 84614 (November 16,
2018), 83 FR 59432 (November 23, 2018).
\12\ See Securities Exchange Act Release No. 85184, 84 FR 6842
(February 28, 2019) (``Order Affirming SR-BOX-2018-24 OIP'').
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II. Discussion
Pursuant to Rule 431 of the Commission Rules of Practice,\13\ the
Exchange's Petition is granted. The Commission is not providing for a
time period during which any party to the action or other person may
file a written statement in support of or in opposition to the Order
Instituting Proceedings.\14\ The Commission believes that the issues
raised by the Exchange's Petition were presented during the course of
the Commission's review of the Exchange's petition to review the
delegated action in BOX 1 temporarily suspending and instituting
proceedings, in which two statements were received and considered by
the Commission in its order affirming the delegated action.\15\ The
Commission therefore does not believe the Petition presents any new
issues that would benefit from an additional period for written
statement and believes that no time period for the filing of statements
is necessary for this review.
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\13\ 17 CFR 201.431.
\14\ 17 CFR 201.100(c).
\15\ See Order Affirming SR-BOX-2018-24 OIP, supra note 12. See
also letters to Brent J. Fields, Secretary, Commission, from Lisa J.
Fall, President, BOX, dated December 7, 2018 and Amir C. Tayrani,
Gibson, Dunn & Crutcher LLP, dated December 10, 2018.
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The Commission's Rules of Practice set forth procedures for the
review of actions made pursuant to delegated authority. Rule 431(a)
provides that the Commission may affirm, reverse, modify, set aside, or
remand for further proceedings, in whole or in part, any action made
pursuant to authority delegated in 17 CFR 200.30-1 through 200.30-
18.\16\ For the reasons discussed below, the Commission affirms the
temporary suspension of the proposed rule change and the institution of
proceedings.
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\16\ See 17 CFR 201.431(a).
---------------------------------------------------------------------------
Instituting proceedings and keeping in place the temporary
suspension provides a process for the Commission to further consider
whether the proposed rule change is consistent with the statutory
requirements applicable to a national securities exchange under the
Act. In particular, this approach will allow the Commission to consider
whether the proposed rule change satisfies the standards under the Act
and the rules thereunder requiring, among other things, that (i) an
exchange's rules provide for the equitable allocation of reasonable
fees among members, issuers, and other persons using its facilities;
(ii) do not permit unfair discrimination between customers, issuers,
brokers, or dealers; and (iii) do not impose any burden on competition
not necessary or appropriate in furtherance of the purposes of the
Act.\17\ Accordingly, the Order Instituting Proceedings properly
concluded that it was appropriate in the public interest, for the
protection of investors, and otherwise in furtherance of the purposes
of the Act to temporarily suspend the proposed rule change and to
institute proceedings to determine whether the proposed rule change
should be approved or disapproved in view of the significant legal and
policy issues raised by the proposal.\18\
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\17\ See Order Instituting Proceedings, supra note 4, at 7150.
\18\ See id.
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Further, suspending the filing and instituting proceedings
constitutes an interim step in the Commission's consideration of the
substantive issues raised by the filing, and does not constitute a
final disposition of the proposed rule change. As reflected in the
Order Instituting Proceedings, the Commission has not reached any
conclusions with respect to the issues involved.\19\ To the contrary,
the Commission sought additional comment with respect to the concerns
raised by the filing,\20\ and noted that the institution of proceedings
provides the Commission the opportunity to more fully assess the issues
raised.
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\19\ See id.
\20\ See id.
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As noted above, during the proceedings the Commission will consider
whether the proposal satisfies the standards under the Act and the
rules thereunder requiring, among other things, that an exchange's
rules provide for the equitable allocation of reasonable fees among
members, issuers, and other persons using its facilities; not permit
unfair discrimination between customers, issuers, brokers or dealers;
and do not impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act.
Further, the Commission finds that it is in the public interest to
lift the stay during the pendency of the Commission's review. The
Commission believes the continued suspension of the proposed rule
change while the Commission conducts proceedings to consider the
Exchange's proposal will allow the Commission to further
[[Page 11852]]
consider the proposed fees' consistency with the Exchange Act without
the risk of allowing a fee that is potentially inconsistent with the
Exchange Act to remain in effect. The Commission also does not believe
that lifting the stay precludes meaningful review of the Order
Instituting Proceedings.
For the reasons stated above, it is hereby:
Ordered that the Exchange's petition for review of the Division's
action, by delegated authority, temporarily suspending the proposed
rule change and simultaneously instituting proceedings to determine
whether to approve or disapprove the proposed rule change be granted;
and
It is further ordered that the Division's Order Instituting
Proceedings by delegated authority is hereby affirmed; and
It is further ordered that the automatic stay of delegated action
pursuant to Commission Rule of Practice 431(e) \21\ is hereby
discontinued.
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\21\ 17 CFR 201.431(e).
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The order temporarily suspending such proposed rule change and
instituting proceedings to determine whether to approve or disapprove
such proposed rule change shall remain in effect.
By the Commission.
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-05912 Filed 3-27-19; 8:45 am]
BILLING CODE P
