Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating To Move Certain Rules in Chapter XXIX of the Currently Effective Rulebook to Proposed Section E of Chapter 4 of the Shell Structure for the Exchange's Rulebook That Will Become Effective Upon the Migration of the Exchange's Trading Platform, 56509-56511 [2019-22936]
Download as PDF
<![CDATA[
Federal Register / Vol. 84, No. 204 / Tuesday, October 22, 2019 / Notices
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–NYSEAMER–2019–42, and
should be submitted on or before
November 12, 2019.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.15
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019–22932 Filed 10–21–19; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–87321; File No. SR–CBOE–
2019–089]
Self-Regulatory Organizations; Cboe
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Relating To Move Certain
Rules in Chapter XXIX of the Currently
Effective Rulebook to Proposed
Section E of Chapter 4 of the Shell
Structure for the Exchange’s Rulebook
That Will Become Effective Upon the
Migration of the Exchange’s Trading
Platform
October 16, 2019.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on October
3, 2019, Cboe Exchange, Inc. (the
‘‘Exchange’’ or ‘‘Cboe Options’’) filed
with the Securities and Exchange
Commission (the ‘‘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
Cboe Exchange, Inc. (the ‘‘Exchange’’
or ‘‘Cboe Options’’) proposes to move
certain Rules in Chapter XXIX, which
governs Credit Option contracts, of the
currently effective Rulebook (‘‘current
Rulebook’’) to proposed Section E of
Chapter 4 of the shell structure for the
Exchange’s Rulebook that will become
effective upon the migration of the
Exchange’s trading platform to the same
system used by the Cboe Affiliated
Exchanges (as defined below) (‘‘shell
Rulebook’’). The text of the proposed
rule change is provided in Exhibit 5.
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.
56509
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
In 2016, the Exchange’s parent
company, Cboe Global Markets, Inc.
(formerly named CBOE Holdings, Inc.)
(‘‘Cboe Global’’), which is also the
parent company of Cboe C2 Exchange,
Inc. (‘‘C2’’), acquired Cboe EDGA
Exchange, Inc. (‘‘EDGA’’), Cboe EDGX
Exchange, Inc. (‘‘EDGX’’ or ‘‘EDGX
Options’’), Cboe BZX Exchange, Inc.
(‘‘BZX’’ or ‘‘BZX Options’’), and Cboe
BYX Exchange, Inc. (‘‘BYX’’ and,
together with Cboe Options, C2, EDGX,
EDGA, and BZX, the ‘‘Cboe Affiliated
Exchanges’’). The Cboe Affiliated
Exchanges are working to align certain
system functionality, retaining only
intended differences, between the Cboe
Affiliated Exchanges, in the context of a
technology migration. Cboe Options
intends to migrate its trading platform to
the same system used by the Cboe
Affiliated Exchanges, which the
Exchange expects to complete on
October 7, 2019. In connection with this
technology migration, the Exchange has
a shell Rulebook that resides alongside
its current Rulebook, which shell
Rulebook will contain the Rules that
will be in place upon completion of the
Cboe Options technology migration.
The Exchange proposes to relocate
rules under current Chapter XXIX
which governs Credit Option contracts,
to proposed Section E of Chapter 4 in
the shell Rulebook. The Exchange notes
that in addition to relocating these
current rules to proposed shell Section
E of Chapter 4, the proposed rule change
deletes the rules from the current
Rulebook. The proposed rule change
relocates the rules as follows:
Proposed rule
Current rule
Introductory paragraph under Section E heading ....................................
4.40 Credit Default Definitions ...............................................................
4.41 Designation of Credit Default Option Contracts ............................
4.42 Designation and Terms of Credit Default Basket Option Contracts.
4.43 Withdrawal of Approval of Underlying Reference Entity ...............
4.44 Adjustments ...................................................................................
4.45 FLEX Trading .................................................................................
4.46 Trading Rotations ...........................................................................
Introduction.
29.1 Definitions.
29.2 Designation of Credit Default Option Contracts.
29.2A Designation and Terms of Credit Default Basket Option Contracts.
29.3 Withdrawal.
29.4 Adjustments.
29.18. FLEX Trading.
29.12 Trading Rotations.
The proposed changes are of a nonsubstantive nature and will not amend
15 17
1 15
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
VerDate Sep<11>2014
17:02 Oct 21, 2019
the relocated rules other than to update
their numbers, conform paragraph
2 17
CFR 240.19b–4.
Exchange notes that the paragraph structure
for definitions listed under rules in the shell
3 The
Jkt 250001
PO 00000
Frm 00099
Fmt 4703
Sfmt 4703
structure 3 and number/lettering format
to that of the shell Rulebook, and make
Rulebook is in alphabetized format. Therefore, the
same structure is used under proposed Rule 4.40.
E:\FR\FM\22OCN1.SGM
22OCN1
56510
Federal Register / Vol. 84, No. 204 / Tuesday, October 22, 2019 / Notices
cross-reference changes to shell rules.
As indicated above, the proposed rule
change relocates current Rule 29.12 to
proposed Rule 4.46. Current Rule 29.12,
however, currently contains rule
language that is no longer applicable to
the Exchange. It currently states that in
accordance with Rule 6.2 (Rule 5.31 in
the shell Rulebook), at a randomly
selected time within a number of
seconds after 8:30 a.m. (CT), unless
unusual circumstances exist, the System
will initiate the opening procedure and
send a Rotation Notice. The Exchange
notes that this language referenced in
current Rule 29.12 regarding the
opening process in Rule 6.2 (shell Rule
5.31) had prior been amended,4 and
Rule 29.12 was inadvertently not
updated to reflect the amended opening
process. Therefore, the proposed rule
change updates current 29.12 (proposed
Rule 4.46) to simply reflect the existing
opening process language in shell Rule
5.31 (current Rule 6.2) by stating that in
accordance with Rule 5.31(d), at an
Exchange-determined number of
seconds following 9:30 a.m., the System
will initiate the opening rotation.5 The
proposed rule change also removes
current Rule 29.14(d) which states that
the rules of priority and order allocation
procedures set forth in (current) Rule
6.45 (shell Rules 5.32 and 5.85) apply to
Credit Options, as this is redundant of
the shell Rules 5.32 and 5.85 themselves
because they already govern the priority
and order allocation of all options
trading on the Exchange, both
electronically (shell Rule 5.32) and in
open outcry (shell Rule 5.85). Also, the
proposed change removes the remainder
of the rule text under current Rule
29.14, which states that Rule 29.14
supplements (current) Rules 6.41, 6.42,
6.44 and 6.45, because all provisions
under current Rule 29.14 have already
been relocated to other rules in the shell
Rulebook in anticipation of migration
and would apply to Credit Options 6
and, therefore, current Rule 29.14 as a
4 See Securities Exchange Act Release No. 79520
(December 9, 2016), 81 FR 90896 (December 15,
2019) (Notice of Filing of Amendment No. 1 and
Order Granting Accelerated Approval of a Proposed
Rule Change, as Modified by Amendment No. 1,
Relating To Opening and Closing Rotations Under
the HOSS System) (SR–CBOE–2016–071).
5 The Exchange notes it does not currently list
any Credit Options for trading, so this change will
have no impact on any current trading.
6 See Securities and Exchange Act Release No.
86772 (August 27, 2019), 84 FR 46069 (September
3, 2019) (Notice of Filing and Immediate
Effectiveness of a Proposed Rule Change To Amend
Rules Related to How the System Handles Incoming
Orders and Open Outcry Trading in Connection
With the Migration of the Exchange’s Trading
Platform to the Same System Used by the Cboe
Affiliated Exchanges) (SR–CBOE–2019–042).
VerDate Sep<11>2014
17:02 Oct 21, 2019
Jkt 250001
whole will no longer exist upon
migration.
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.7 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 8 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) 9 requirement that
the rules of an exchange not be designed
to permit unfair discrimination between
customers, issuers, brokers, or dealers.
As stated, the proposed rule change
makes no substantive changes to the
rules. The proposed rule change is
merely intended to relocate the
Exchange’s rules to the shell Rulebook
and update their numbers, paragraph
structure, including number and
lettering format, and cross-references
(including updating certain rule text to
accurately reiterate rule language to
which a cross-reference refers), and
remove a redundant provision already
specifically covered under other shell
rules, to conform to the shell Rulebook
as a whole in anticipation of the
technology migration on October 7,
2019. As such, the proposed rule change
is designed to promote just and
equitable principles of trade, 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, by improving the way
the Exchange’s Rulebook is organized,
making it easier to read, and,
particularly, helping market participants
better understand the rules of the
Exchange, which will also result in less
burdensome and more efficient
regulatory compliance.
7 15
8 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
9 Id.
PO 00000
Frm 00100
Fmt 4703
Sfmt 4703
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act. The
proposed rule change is not intended as
a competitive change, but rather, seeks
to make non-substantive rule changes in
relocating the rules, updating crossreferences (and cross-referenced rule
text) to shell rules, and removing a
redundant provision already specifically
covered under other rules, in
anticipation of the October 7, 2019
technology migration. The Exchange
also does not believe that the proposed
rule change will impose any undue
burden on competition because the
relocated rule text is exactly the same as
the Exchange’s current rules, all of
which have all been previously filed
with the Commission.
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
The Exchange has filed the proposed
rule change pursuant to Section
19(b)(3)(A)(iii) of the Act 10 and Rule
19b–4(f)(6) thereunder.11 Because the
proposed rule change does not: (i)
Significantly affect the protection of
investors or the public interest; (ii)
impose any significant burden on
competition; and (iii) become operative
for 30 days from the date on which it
was filed, or such shorter time as the
Commission may designate, if
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 12 and Rule 19b–4(f)(6)
thereunder.13
A proposed rule change filed under
Rule 19b–4(f)(6) 14 normally does not
become operative prior to 30 days after
10 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
U.S.C. 78s(b)(3)(A).
13 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the Exchange to give the
Commission written notice of the Exchange’s intent
to file the proposed rule change, along with a brief
description and 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 Commission
has waived that requirement in this case.
14 17 CFR 240.19b–4(f)(6).
11 17
12 15
E:\FR\FM\22OCN1.SGM
22OCN1
Federal Register / Vol. 84, No. 204 / Tuesday, October 22, 2019 / Notices
the date of the filing. However, pursuant
to Rule 19b–4(f)(6)(iii),15 the
Commission may designate a shorter
time if such action is consistent with the
protection of investors and the public
interest. The Exchange has asked the
Commission to waive the 30-day
operative delay so that the proposed
rule change may become operative
immediately. The Exchange notes that
the proposed rule change is merely
relocating certain rules to its shell
rulebook—which includes
corresponding updates to rule numbers,
cross-references, and other references—
in order to conform these rules to the
shell rulebook upon the technology
migration explained above. The
Exchange believes that the proposed
rule change will make its rules easier to
read and understand for all investors.
The Exchange also asserts that the
relocation of the rules explained above
will not impose any significant burden
on competition as the substance of the
rules remains unchanged. The
Commission agrees that allowing this
proposed rule change to become
operative upon filing in order to
facilitate the Exchange’s technology
migration—without changing the
substance of these Exchange Rules—is
consistent with the protection of
investors and the public interest. For
this reason, the Commission hereby
waives the 30-day operative delay and
designates the proposal operative upon
filing.16
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
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:
15 17
CFR 240.19b–4(f)(6)(iii).
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).
16 For
VerDate Sep<11>2014
17:02 Oct 21, 2019
Jkt 250001
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–2019–089 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–2019–089. 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
offices 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–2019–089, and
should be submitted on or before
November 12, 2019.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.17
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019–22936 Filed 10–21–19; 8:45 am]
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–87318; File No. SR–
NYSECHX–2019–11]
Self-Regulatory Organizations; NYSE
Chicago, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend the Certificate
of Incorporation of Intercontinental
Exchange, Inc.
October 16, 2019.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on October
3, 2019, the NYSE Chicago, Inc. (‘‘NYSE
Chicago’’ or the ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the selfregulatory organization. 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 the Substance
of the Proposed Rule Change
The Exchange proposes to amend the
certificate of incorporation of
Intercontinental Exchange, Inc. (‘‘ICE’’)
to make a technical change updating the
registered office and registered agent in
the State of Delaware and make nonsubstantive and conforming changes.
The proposed rule change is available
on the Exchange’s website at
www.nyse.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
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 those 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 parts of such
statements.
BILLING CODE 8011–01–P
1 15
U.S.C.78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
17 17
PO 00000
CFR 200.30–3(a)(12), (59).
Frm 00101
Fmt 4703
Sfmt 4703
56511
E:\FR\FM\22OCN1.SGM
22OCN1
]]>Agencies
[Federal Register Volume 84, Number 204 (Tuesday, October 22, 2019)]
[Notices]
[Pages 56509-56511]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-22936]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-87321; File No. SR-CBOE-2019-089]
Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change Relating
To Move Certain Rules in Chapter XXIX of the Currently Effective
Rulebook to Proposed Section E of Chapter 4 of the Shell Structure for
the Exchange's Rulebook That Will Become Effective Upon the Migration
of the Exchange's Trading Platform
October 16, 2019.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on October 3, 2019, Cboe Exchange, Inc. (the ``Exchange'' or
``Cboe Options'') filed with the Securities and Exchange Commission
(the ``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.
---------------------------------------------------------------------------
\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
Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe Options'') proposes
to move certain Rules in Chapter XXIX, which governs Credit Option
contracts, of the currently effective Rulebook (``current Rulebook'')
to proposed Section E of Chapter 4 of the shell structure for the
Exchange's Rulebook that will become effective upon the migration of
the Exchange's trading platform to the same system used by the Cboe
Affiliated Exchanges (as defined below) (``shell Rulebook''). The text
of the proposed rule change is provided in Exhibit 5.
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
In 2016, the Exchange's parent company, Cboe Global Markets, Inc.
(formerly named CBOE Holdings, Inc.) (``Cboe Global''), which is also
the parent company of Cboe C2 Exchange, Inc. (``C2''), acquired Cboe
EDGA Exchange, Inc. (``EDGA''), Cboe EDGX Exchange, Inc. (``EDGX'' or
``EDGX Options''), Cboe BZX Exchange, Inc. (``BZX'' or ``BZX
Options''), and Cboe BYX Exchange, Inc. (``BYX'' and, together with
Cboe Options, C2, EDGX, EDGA, and BZX, the ``Cboe Affiliated
Exchanges''). The Cboe Affiliated Exchanges are working to align
certain system functionality, retaining only intended differences,
between the Cboe Affiliated Exchanges, in the context of a technology
migration. Cboe Options intends to migrate its trading platform to the
same system used by the Cboe Affiliated Exchanges, which the Exchange
expects to complete on October 7, 2019. In connection with this
technology migration, the Exchange has a shell Rulebook that resides
alongside its current Rulebook, which shell Rulebook will contain the
Rules that will be in place upon completion of the Cboe Options
technology migration.
The Exchange proposes to relocate rules under current Chapter XXIX
which governs Credit Option contracts, to proposed Section E of Chapter
4 in the shell Rulebook. The Exchange notes that in addition to
relocating these current rules to proposed shell Section E of Chapter
4, the proposed rule change deletes the rules from the current
Rulebook. The proposed rule change relocates the rules as follows:
------------------------------------------------------------------------
Proposed rule Current rule
------------------------------------------------------------------------
Introductory paragraph under Section E Introduction.
heading.
4.40 Credit Default Definitions........ 29.1 Definitions.
4.41 Designation of Credit Default 29.2 Designation of Credit
Option Contracts. Default Option Contracts.
4.42 Designation and Terms of Credit 29.2A Designation and Terms of
Default Basket Option Contracts. Credit Default Basket Option
Contracts.
4.43 Withdrawal of Approval of 29.3 Withdrawal.
Underlying Reference Entity.
4.44 Adjustments....................... 29.4 Adjustments.
4.45 FLEX Trading...................... 29.18. FLEX Trading.
4.46 Trading Rotations................. 29.12 Trading Rotations.
------------------------------------------------------------------------
The proposed changes are of a non-substantive nature and will not
amend the relocated rules other than to update their numbers, conform
paragraph structure \3\ and number/lettering format to that of the
shell Rulebook, and make
[[Page 56510]]
cross-reference changes to shell rules. As indicated above, the
proposed rule change relocates current Rule 29.12 to proposed Rule
4.46. Current Rule 29.12, however, currently contains rule language
that is no longer applicable to the Exchange. It currently states that
in accordance with Rule 6.2 (Rule 5.31 in the shell Rulebook), at a
randomly selected time within a number of seconds after 8:30 a.m. (CT),
unless unusual circumstances exist, the System will initiate the
opening procedure and send a Rotation Notice. The Exchange notes that
this language referenced in current Rule 29.12 regarding the opening
process in Rule 6.2 (shell Rule 5.31) had prior been amended,\4\ and
Rule 29.12 was inadvertently not updated to reflect the amended opening
process. Therefore, the proposed rule change updates current 29.12
(proposed Rule 4.46) to simply reflect the existing opening process
language in shell Rule 5.31 (current Rule 6.2) by stating that in
accordance with Rule 5.31(d), at an Exchange-determined number of
seconds following 9:30 a.m., the System will initiate the opening
rotation.\5\ The proposed rule change also removes current Rule
29.14(d) which states that the rules of priority and order allocation
procedures set forth in (current) Rule 6.45 (shell Rules 5.32 and 5.85)
apply to Credit Options, as this is redundant of the shell Rules 5.32
and 5.85 themselves because they already govern the priority and order
allocation of all options trading on the Exchange, both electronically
(shell Rule 5.32) and in open outcry (shell Rule 5.85). Also, the
proposed change removes the remainder of the rule text under current
Rule 29.14, which states that Rule 29.14 supplements (current) Rules
6.41, 6.42, 6.44 and 6.45, because all provisions under current Rule
29.14 have already been relocated to other rules in the shell Rulebook
in anticipation of migration and would apply to Credit Options \6\ and,
therefore, current Rule 29.14 as a whole will no longer exist upon
migration.
---------------------------------------------------------------------------
\3\ The Exchange notes that the paragraph structure for
definitions listed under rules in the shell Rulebook is in
alphabetized format. Therefore, the same structure is used under
proposed Rule 4.40.
\4\ See Securities Exchange Act Release No. 79520 (December 9,
2016), 81 FR 90896 (December 15, 2019) (Notice of Filing of
Amendment No. 1 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 1, Relating To
Opening and Closing Rotations Under the HOSS System) (SR-CBOE-2016-
071).
\5\ The Exchange notes it does not currently list any Credit
Options for trading, so this change will have no impact on any
current trading.
\6\ See Securities and Exchange Act Release No. 86772 (August
27, 2019), 84 FR 46069 (September 3, 2019) (Notice of Filing and
Immediate Effectiveness of a Proposed Rule Change To Amend Rules
Related to How the System Handles Incoming Orders and Open Outcry
Trading in Connection With the Migration of the Exchange's Trading
Platform to the Same System Used by the Cboe Affiliated Exchanges)
(SR-CBOE-2019-042).
---------------------------------------------------------------------------
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.\7\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \8\ 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) \9\ requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(5).
\9\ Id.
---------------------------------------------------------------------------
As stated, the proposed rule change makes no substantive changes to
the rules. The proposed rule change is merely intended to relocate the
Exchange's rules to the shell Rulebook and update their numbers,
paragraph structure, including number and lettering format, and cross-
references (including updating certain rule text to accurately
reiterate rule language to which a cross-reference refers), and remove
a redundant provision already specifically covered under other shell
rules, to conform to the shell Rulebook as a whole in anticipation of
the technology migration on October 7, 2019. As such, the proposed rule
change is designed to promote just and equitable principles of trade,
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, by improving the way the Exchange's
Rulebook is organized, making it easier to read, and, particularly,
helping market participants better understand the rules of the
Exchange, which will also result in less burdensome and more efficient
regulatory compliance.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The proposed rule change is not
intended as a competitive change, but rather, seeks to make non-
substantive rule changes in relocating the rules, updating cross-
references (and cross-referenced rule text) to shell rules, and
removing a redundant provision already specifically covered under other
rules, in anticipation of the October 7, 2019 technology migration. The
Exchange also does not believe that the proposed rule change will
impose any undue burden on competition because the relocated rule text
is exactly the same as the Exchange's current rules, all of which have
all been previously filed with the Commission.
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
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \10\ and Rule 19b-4(f)(6) thereunder.\11\
Because the proposed rule change does not: (i) Significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative for 30
days from the date on which it was filed, or such shorter time as the
Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act \12\ and Rule 19b-
4(f)(6) thereunder.\13\
---------------------------------------------------------------------------
\10\ 15 U.S.C. 78s(b)(3)(A)(iii).
\11\ 17 CFR 240.19b-4(f)(6).
\12\ 15 U.S.C. 78s(b)(3)(A).
\13\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's intent to file the proposed rule change, along with a
brief description and 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
Commission has waived that requirement in this case.
---------------------------------------------------------------------------
A proposed rule change filed under Rule 19b-4(f)(6) \14\ normally
does not become operative prior to 30 days after
[[Page 56511]]
the date of the filing. However, pursuant to Rule 19b-4(f)(6)(iii),\15\
the Commission may designate a shorter time if such action is
consistent with the protection of investors and the public interest.
The Exchange has asked the Commission to waive the 30-day operative
delay so that the proposed rule change may become operative
immediately. The Exchange notes that the proposed rule change is merely
relocating certain rules to its shell rulebook--which includes
corresponding updates to rule numbers, cross-references, and other
references--in order to conform these rules to the shell rulebook upon
the technology migration explained above. The Exchange believes that
the proposed rule change will make its rules easier to read and
understand for all investors. The Exchange also asserts that the
relocation of the rules explained above will not impose any significant
burden on competition as the substance of the rules remains unchanged.
The Commission agrees that allowing this proposed rule change to become
operative upon filing in order to facilitate the Exchange's technology
migration--without changing the substance of these Exchange Rules--is
consistent with the protection of investors and the public interest.
For this reason, the Commission hereby waives the 30-day operative
delay and designates the proposal operative upon filing.\16\
---------------------------------------------------------------------------
\14\ 17 CFR 240.19b-4(f)(6).
\15\ 17 CFR 240.19b-4(f)(6)(iii).
\16\ 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).
---------------------------------------------------------------------------
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 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-2019-089 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-2019-089. 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 offices 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-2019-089, and should be submitted
on or before November 12, 2019.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
---------------------------------------------------------------------------
\17\ 17 CFR 200.30-3(a)(12), (59).
---------------------------------------------------------------------------
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-22936 Filed 10-21-19; 8:45 am]
BILLING CODE 8011-01-P
