Self-Regulatory Organizations; Cboe C2 Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Updating Various C2 Rules and Chapters To Reflect Changes to the Cboe Options Rulebook, 66938-66943 [2019-26308]
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Federal Register / Vol. 84, No. 235 / Friday, December 6, 2019 / Notices
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transfer, as supplemented, and other
information before the Commission, the NRC
staff has determined that OpCo and OwnerCo
are qualified to hold the licenses to the extent
proposed to permit the transfer of the
licenses from FENOC and FENGen to OpCo
and OwnerCo, respectively, and that the
transfers of the licenses, as described in the
application, are otherwise consistent with
applicable provisions of law, regulations, and
orders issued by the NRC pursuant thereto,
subject to the conditions set forth below.
Upon review of the information in the
application for conforming amendments, as
supplemented, the NRC staff has determined
that:
(1) The application for conforming license
amendments complies with the standards
and requirements of the Atomic Energy Act
of 1954, as amended (the Act), and the
Commission’s rules and regulations set forth
in 10 CFR Chapter I.
(2) The Facilities will operate in
conformity with the application, the
provisions of the Act, and the rules and
regulations of the Commission.
(3) There is reasonable assurance that the
activities authorized by the amendments can
be conducted without endangering the health
and safety of the public and that such
activities will be conducted in compliance
with the Commission’s regulations.
(4) The issuance of the amendments will
not be inimical to the common defense and
security or to the health and safety of the
public.
(5) The issuance of the amendments is in
accordance with 10 CFR part 51 of the
Commission’s regulations and all applicable
requirements have been satisfied.
The findings set forth above are supported
by an NRC staff safety evaluation dated the
same date as this Order, which is available
at ADAMS Accession No. ML19305B131
(non-proprietary).
III.
Accordingly, pursuant to Sections 161b,
161i, and 184 of the Atomic Energy Act of
1954, as amended, 42 U.S.C. 2201(b), 2201(i),
and 2234; and 10 CFR 50.80, 10 CFR 72.50,
and 10 CFR 50.90, it is hereby ordered that
the application for license transfers, as
described herein, is approved for BVPS, Unit
1, BVPS, Unit 2, DBNPS, and PNPP, and the
respective ISFSIs, subject to the following
conditions.
1. OwnerCo and OpCo shall provide
satisfactory documentary evidence to the
Director of the NRC Office of Nuclear Reactor
Regulation that, as of the date of the license
transfer, the licensees reflected in the
amended licenses have obtained the
appropriate amount of insurance required of
a licensee under 10 CFR part 140 and 10 CFR
50.54(w).
2. On or by the closing date of the license
transfer transaction, the Applicants shall take
all necessary steps to ensure that the
provisional trust agreement submitted on
September 25, 2019, to address the shortfall
identified for BVPS, Unit 1 is implemented
and maintained consistent with the safety
evaluation supporting this Order.
3. The NRC staff’s approval of these license
transfers is subject to the Commission’s
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authority to rescind, modify, or condition the
approved transfers based on the outcome of
any post-effectiveness hearing on the license
transfer application.
It is further ordered that after receipt of all
required regulatory approvals of the
proposed transfer actions, the Applicants
shall inform the Director of the Office of
Nuclear Reactor Regulation in writing of such
receipt no later than 5 business days prior to
the date of the closing of the transfer. Should
the proposed transfer not be completed
within 1 year from the date of this Order, this
Order shall become null and void, provided,
however, upon written application and for
good cause shown, such date may be
extended by order. The conditions of this
Order may be amended upon application by
the Applicants and approval by the Director
of the Office of Nuclear Reactor Regulation.
It is further ordered that consistent with 10
CFR 2.1315(b), the license amendments that
make changes, as indicated in Enclosures 2
through 5 to the letter transmitting this
Order, to reflect the subject transfers, are
approved. The amendments shall be issued
and made effective within 30 days of the date
when the proposed transfer actions are
completed.
This Order is effective upon issuance.
For further details with respect to this
Order, see the application dated April 26,
2019, as supplemented by letters dated May
31, 2019; August 2, 2019; August 29, 2019;
September 25, 2019 (two submissions); and
October 17, 2019, and the NRC safety
evaluation dated the same date as this Order,
which are available for public inspection at
the NRC’s Public Document Room (PDR)
located at One White Flint North, Public File
Area 01 F21, 11555 Rockville Pike (first
floor), Rockville, Maryland. Publicly
available documents created or received at
the NRC are accessible electronically through
ADAMS in the NRC Library at https://
www.nrc.gov/reading-rm/adams.html.
Persons who do not have access to ADAMS
or who encounter problems accessing the
documents located in ADAMS, should
contact the NRC PDR reference staff by
telephone at 1–800–397–4209 or 301–415–
4737, or by email to pdr.resource@nrc.gov.
Dated at Rockville, Maryland this 2nd day
of December 2019.
For the Nuclear Regulatory Commission.
/RA/
Eric J. Benner,
Deputy Director, Office of Nuclear Reactor
Regulation.
[FR Doc. 2019–26389 Filed 12–5–19; 8:45 am]
BILLING CODE 7590–01–P
POSTAL SERVICE
Product Change—Priority Mail
Negotiated Service Agreement
Postal ServiceTM.
Notice.
AGENCY:
ACTION:
The Postal Service gives
notice of filing a request with the Postal
Regulatory Commission to add a
SUMMARY:
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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:
December 6, 2019.
FOR FURTHER INFORMATION CONTACT:
Sean Robinson, 202–268–8405.
SUPPLEMENTARY INFORMATION: The
United States Postal Service® hereby
gives notice that, pursuant to 39 U.S.C.
3642 and 3632(b)(3), on December 2,
2019, it filed with the Postal Regulatory
Commission a USPS Request to Add
Priority Mail Contract 567 to
Competitive Product List. Documents
are available at www.prc.gov, Docket
Nos. MC2020–43, CP2020–41.
Sean Robinson,
Attorney, Corporate and Postal Business Law.
[FR Doc. 2019–26302 Filed 12–5–19; 8:45 am]
BILLING CODE 7710–12–P
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COMMISSION
[Release No. 34–87646; File No. SR–C2–
2019–025]
Self-Regulatory Organizations; Cboe
C2 Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Updating Various C2
Rules and Chapters To Reflect
Changes to the Cboe Options
Rulebook
December 2, 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 November
20, 2019, Cboe C2 Exchange, Inc. (the
‘‘Exchange’’ or ‘‘C2’’) filed with the
Securities and Exchange Commission
(the ‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The Exchange filed the
proposal as a ‘‘non-controversial’’
proposed rule change pursuant to
Section 19(b)(3)(A)(iii) of the Act 3 and
Rule 19b–4(f)(6) thereunder.4 The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Cboe C2 Exchange, Inc. (the
‘‘Exchange’’ or ‘‘C2’’) proposes to update
various C2 Rules and Chapters to reflect
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6).
2 17
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Federal Register / Vol. 84, No. 235 / Friday, December 6, 2019 / Notices
changes to the Cboe Options rulebook
that became effective upon the October
7, 2019 migration of the Cboe Options’
trading platform to the same system
used by the Cboe Affiliated Exchanges
(as defined below), including C2. 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://markets.cboe.com/us/
options/regulation/rule_filings/ctwo/),
at the Exchange’s Office of the
Secretary, and at the Commission’s
Public Reference Room.
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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’’). On October 7, 2019, Cboe
Options migrated its trading platform to
66939
the same system used by the Cboe
Affiliated Exchanges. In connection
with this technology migration, Cboe
Options updated and reorganized its
rulebook, which became effective upon
the technology migration.
The Exchange now proposes to
reorganize various Chapters in its
Rulebook that incorporate Cboe Options
chapters by reference in order to
correspond to the post-migration
structure of the Cboe Options rulebook.
The proposed rule change also updates
cross-references to Cboe Options rules
and chapters that have been relocated in
the Cboe Options post-migration
rulebook. It also proposes to delete
certain Chapters that incorporate by
reference Cboe Option’s chapters that
are no longer holistically in the Cboe
Options rulebook as a result of the
reorganization of the rules under such
chapters to various other Cboe Options
rules and chapters. The proposed rule
change moves and, where applicable,
removes the rules as follows:
Proposed Chapter
Current Rule/Chapter
Chapter 3, Section B TPH Registration 5
Incorporates by reference certain Cboe Options rules under Cboe Options Chapter 3, Section B (rules formerly under Cboe Options Chapter 9).6
Rule 3.30.
Chapter 9 Doing Business with the Public
Incorporates by reference certain rules under former Cboe Options
Chapter 9 (former Cboe Options Rules 9.1, 9.2, 9.3, 9.3A, 9.4, 9.5,
9.6).
Rule 3.4.
Chapter 4, Section A Equity and ETP Options
Incorporates by reference Cboe Options Chapter 4, Section A (former
Cboe Options Chapter 5); 7 and
Chapter 4, Section B Index Options
Incorporates by reference Cboe Options Chapter 4, Section B (rules regarding index options listing under former Cboe Options Chapter
24).8
Chapter 5 Securities Dealt In
Incorporates by reference former Cboe Options Chapter 5; and
Chapter 24 Index Options
Incorporates by reference former Cboe Options Chapter 24 (except for
former Rules 24.6, 24.7, 24.13, 24.15, 24.19, 24.20, and 24.21).
Chapter 5 Business Conduct 9
Incorporates by reference Cboe Options Chapter 8 (comprised of
former Cboe Options Chapter 4, as well as rules regarding position
limits and exercise limits for index options under former Cboe Chapter 24).10
Chapter 4 Business Conduct
Incorporates by reference former Cboe Options Chapter 4; and
Chapter 24 Index Options
Incorporates by reference former Cboe Options Chapter 24.
Chapter 6, Section F Exercises and Deliveries
Incorporates by reference Cboe Options Chapter 6, Section B (former
Cboe Options Chapter 11, as well as former Cboe Options Rule
24.18).
Chapter 11 Exercises and Deliveries
Incorporates by reference former Cboe Options Chapter 11
Chapter 24 Index Options
Incorporates by reference former Cboe Options Chapter 24.
Chapter 7, Section A General
Incorporates by reference Cboe Options Chapter 7, Section A (former
Cboe Options Chapter 15); and
Chapter 7, Section B Consolidated Audit Trail (CAT)
Incorporates by reference Cboe Options Chapter 7, Section B (which
was former Cboe Options Chapter 6, Section F (Consolidated Audit
Trail (CAT)).11
Chapter 15 Records, Reports, and Audits
Incorporates by reference former Cboe Options Chapter 15.
Chapter 9 Doing Business with the Public
Removes Rule 3.19, which is identical to Cboe Options Rule 9.20, and
incorporates by reference Cboe Options Rule 9.20 (which becomes
incorporated by reference under the umbrella of the overall incorporation by reference of Cboe Options Chapter 9).12
Chapter 9 Doing Business with the Public
Incorporates by reference certain rules under Cboe Options Chapter 9
(Rules 9.7 through 9.25).
Chapter 10 Margin Requirements
Incorporates by reference Cboe Options Chapter 10 (former Cboe Options Chapter 12).13
Chapter 12 Margins
Incorporates by reference former Cboe Options Chapter 12.
Chapter 11 Net Capital Requirements
Chapter 13 Net Capital Requirements
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Chapter 6, Section F Consolidated Audit Trail (CAT)
Incorporates by reference former Cboe Options Chapter 6, Section F.
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Federal Register / Vol. 84, No. 235 / Friday, December 6, 2019 / Notices
Proposed Chapter
Incorporates by reference Cboe Options Chapter 11 (former Cboe Options Chapter 13).14
Incorporates by reference former Cboe Options Chapter 13.
Chapter 12 Summary Suspension
Incorporates by reference Cboe Options Chapter 12 (former Cboe Options Chapter 16), and as a result deletes current C2 Chapter 16.15
Chapter 16 Summary Suspension
Incorporates by reference former Cboe Options Chapter 16.
Chapter 13 Discipline
Incorporates by reference Cboe Options Chapter 13 (former Cboe Options Chapter 17), and as a result deletes current C2 Chapter 17.16
Chapter 17 Discipline
Incorporates by reference former Cboe Options Chapter 17.
Chapter 14 Arbitration
Incorporates by reference Cboe Options Chapter 14 (former Cboe Options Chapter 18), and as a result deletes current C2 Chapter 18.17
Chapter 18 Arbitration
Incorporates by reference former Cboe Options Chapter 18.
Chapter 15 Hearings and Review
Incorporates by reference Cboe Options Chapter 15 (former Cboe Options Chapter 19), and as a result deletes current C2 Chapter 19.18
Chapter 19 Hearings and Review
Incorporates by reference former Cboe Options Chapter 19.
To be deleted
Chapter 10 Closing Transactions
To be deleted
Chapter 24 Index Options
The majority of the proposed changes
are of a non-substantive nature and will
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Current Rule/Chapter
5 The proposed rule change also adds a Section
A (TPH Qualifications) heading to C2 Rules
currently in Chapter 3, which is consistent with the
section structure in Cboe Options Chapter 3.
6 The filing to reorganize Cboe Options Chapter
9 and move rules to Cboe Options Chapter 3,
Section B did not make any substantive changes to
the rules. See Securities and Exchange Act Release
No. 87229 (October 4, 2019), 84 FR 54704 (October
10, 2019) (SR–CBOE–2019–088).
7 The filing to relocate former Cboe Options
Chapter 5 to Cboe Options Chapter 4, Section A did
not make any substantive changes to the rules. See
Securities and Exchange Act Release No. 87272
(October 10, 2019) (SR–CBOE–2019–090).
8 The filing to relocate rules regarding the listing
of index options under former Cboe Options
Chapter 24 to Cboe Options Chapter 4, Section B
did not make any substantive changes to the rules.
See Securities Exchange Act Release No. 87337
(October 17, 2019), 84 FR 56879 (October 23, 2019)
(SR–CBOE–2019–092).
9 The Exchange notes that proposed C2 Chapter
5 incorporates by reference Cboe Options Chapter
8, as current C2 Chapter 8 is already comprised of
C2 Market-Maker Rules.
10 The filing to relocate former Cboe Options
Chapter 4, as well as rules regarding position limits
and exercise limits for index options under former
Cboe Chapter 24, to Cboe Options Chapter 8 did not
make any substantive changes to the rules. See
Securities Exchange Act Release No. 87224 (October
4, 2019), 84 FR 54652 (October 10, 2019) (SR–
CBOE–2019–081).
11 The filing to relocate former Cboe Options
Chapter 15, as well as former Cboe Options Chapter
6, Section F, to Cboe Options Chapter 7, Sections
A and B, did not make any substantive changes to
the rules. See Securities Exchange Act Release No.
87216 (October 3, 2019), 84 FR 54231 (October 9,
2019) (SR–CBOE–2019–073).
12 See supra note 5.
13 The filing to relocate former Cboe Options
Chapter 12 to Cboe Options Chapter 10 did not
make any substantive changes to the rules. See
Securities Exchange Act Release No. 87189 (October
1, 2019), 84 FR 53520 (October 7, 2019) (SR–CBOE–
2019–069).
14 The filing to relocate former Cboe Options
Chapter 13 to Cboe Options Chapter 11 did not
make any substantive changes to the rules. See
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16:11 Dec 05, 2019
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not amend the relocated rules other than
to update their Chapter numbers, make
cross-reference changes, update or
remove references to certain terms that
have been updated or removed within
the Cboe Options rules (e.g.
‘‘Department of Compliance’’,
‘‘Department of Financial and Sales
Practice Compliance’’, and ‘‘Department
of Member Firm Regulation’’ were all
updated to the ‘‘Exchange’’ in Cboe
Options rules, reference to the Floor is
not found in any Cboe Options rules
that remain in Cboe Options Chapter 9,
and the terms ‘‘Constitution’’ and
‘‘membership are not found in Cboe
Options Chapter 15 (Hearing and
Review)) and update headings in order
to correspond to the structure of the
Cboe Options post-migration Rulebook.
The Exchange notes it also updates
cross-references to Cboe Options rules
Securities Exchange Act Release No. 87188 (October
1, 2019), 84 FR 53480 (October 7, 2019) (SR–CBOE–
2019–066).
15 The filing to relocate former Cboe Options
Chapter 16 to Cboe Options Chapter 12 did not
make any substantive changes to the rules. See
Securities Exchange Act Release No. 87227 (October
4, 2019), 84 FR 54700 (October 10, 2019) (SR–
CBOE–2019–067).
16 The filing to relocate former Cboe Options
Chapter 17 to Cboe Options Chapter 13 did not
make any substantive changes to the rules. See
Securities Exchange Act Release No. 87210 (October
3, 2019), 84 FR 54190 (October 9, 2019) (SR–CBOE–
2019–068).
17 The filing to relocate former Cboe Options
Chapter 18 to Cboe Options Chapter 14 did not
make any substantive changes to the rules. See
Securities Exchange Act Release No. 87183 (October
1, 2019), 84 FR 53548 (October 7, 2019) (SR–CBOE–
2019–065).
18 The filing to relocate former Cboe Options
Chapter 19 to Cboe Options Chapter 15 did not
make any substantive changes to the rules. See
Securities Exchange Act Release No. 87187 (October
1, 2019), 84 FR 53487 (October 7, 2019) (SR–CBOE–
2019–072).
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in C2 Rule 6.1 and in C2 Chapter 6,
Section E, and removes the language
under C2 Rule 1.3 that makes an
exception for the applicability of
Eastern Time in Cboe Options rules
because the Cboe Options postmigration Rulebook was amended to
also state all times in Eastern Time.19
As stated in the table above, the
proposed rule change also incorporates
Cboe Options Rule 9.20, which governs
customer disclosures during Global
Trading Hours, into C2 Chapter 9 by
reference to Cboe Options Chapter 9.
Current Rule 3.19 is identical to Cboe
Options Rule 9.20. Therefore, the
proposed rule change essentially just
relocates current Rule 3.19 to Rule 9.20
in order to include Cboe Options Rule
9.20 in C2 Chapter 9’s incorporation of
Cboe Options Chapter 9 by reference, as
it is within the same category of
exchange rules otherwise incorporated
into C2 Chapter 9 by reference to Cboe
Options Chapter 9 (i.e. rule related to
doing business with the public).
The proposed changes to remove
certain C2 Chapters are of a nonsubstantive nature because they delete
C2 Chapters that incorporate by
reference certain Cboe Options chapters
that are no longer applicable as a result
of the reorganization of the Cboe
Options rulebook. The proposed rule
change removes current C2 Chapter 10
which incorporates (former) Cboe
Options Chapter 10 by reference. The
Exchange notes that prior to
reorganization, Cboe Options Chapter 10
contained only three rules (Cboe
Options Rules 10.1, 10.2, and 10.3). As
a result of Cboe Option’s reorganization,
Cboe Options Rule 10.1 was relocated to
19 See
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Cboe Options Rule 1.6.
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Federal Register / Vol. 84, No. 235 / Friday, December 6, 2019 / Notices
Cboe Options Rule 6.3(g), Cboe Options
Rule 10.2 was relocated to Cboe Options
Rule 12.6, and Cboe Options Rule 10.3
was relocated to Cboe Options Rule
8.18. The Exchange notes that proposed
C2 Chapter 12 incorporates Cboe
Options Chapter 12 by reference, which
now contains former Cboe Options Rule
10.2, and proposed C2 Chapter 5
incorporates Cboe Options Chapter 8 by
reference, which now contains former
Cboe Options Rule 10.3. Because the
current C2 Rules do not incorporate
Cboe Options Chapter 6 by reference,
the proposed rule change simply adds
the language, verbatim, from current
Cboe Options Rule 6.3(g) (former Cboe
Options Rule 10.1) to C2 Rule 6.27(b)
(and updates the current rule text
paragraph formatting and headings
accordingly).
Likewise, the proposed change
removes current C2 Chapter 24 which
incorporates (former) Cboe Options
Chapter 24 by reference. As indicated in
the table above, a majority of the Cboe
Options rules under former Cboe
Options Chapter 24 were relocated to
Cboe Options Chapter 4, Section B and
Chapter 8, and thus covered under
proposed C2 Chapters 4 and 5. The
Exchange notes that former Cboe
Options Rule 24.8 (governing the
meaning of premium bids and offers for
index options) and former Cboe Options
Rule 24.14 (governing limitation of
liability of Reporting Authority for
indexes underlying options) were not
relocated into either of these Chapters,
and instead incorporated into Cboe
Options Rules 5.3(a) and 1.12,
respectively. Because the current C2
Rules do not incorporate post-migration
Cboe Options Chapter 5 or Chapter 1 by
reference, like the proposed rule change
described above, the proposed rule
change simply updates the language
under current C2 Rule 6.3(a) to be
consistent with the rule text under
corresponding Cboe Options Rule 5.3(a),
which now accounts for index options
(from former Cboe Options Rule 24.8),
and adds Rule 6.45, which is identical
to the rule text under Cboe Options Rule
1.12 (former Cboe Options Rule 24.14).
The proposed rule change does not
incorporate former Cboe Options Rule
24.8.01 (current Cboe Options Rule
5.85(e)) nor former Cboe Options Rule
24.22 (current Cboe Options Rule 5.92)
because both rules are specific to
trading on open outcry which is not
applicable to C2. The proposed change
also removes the language under current
C2 Chapter 24 which provides that Cboe
Options Rules 24.6 (Days and Hours of
Business); 24.7 (Trading Halts,
Suspensions, or Primary Market
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16:11 Dec 05, 2019
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Closure); 24.13 (Trading Rotations);
24.15 (Automatic Execution of Index
Options); 24.19 (Multi-Class BroadBased Index Option Spread Orders);
24.20 (SPX Combination Orders); and
24.21 (Index Crowd Space Dispute
Resolution Procedures) do not apply to
C2, because, as a result of the
reorganization of the Cboe Options
rulebook, each of these rules has either
been deleted from the Cboe Options
rulebook or relocated into another Cboe
Options chapter that C2 does not
incorporate by reference. The Exchange
notes that the proposed rule changes
described above do not make any
substantive changes to the manner in
which Cboe Options rules apply to C2.
Additionally, as a result of the
reorganization of the Cboe Options
rulebook, rules in certain former
chapters that the Exchange does not
currently incorporate by reference, such
as chapters that had governed types of
options specific to trading on Cboe
Options (i.e. Range, Binary, Corporate
Debt Security, Government security,
Credit, and interest rate options), and
other specific Cboe Options rules that
do not apply to C2 (i.e. former Cboe
Options Rules 6.2.06, 8.9, 8.6, 6.55, and
6.22),20 were relocated to various Cboe
Options chapters that C2 currently does
incorporate by reference. For example,
former Cboe Options Rules 28.16, 21.30,
and 23.15 (none of which does C2
currently incorporate by reference)
regarding record maintenance,
retention, and furnishing for MarketMakers in Corporate Debt Security
Options, Government security options,
and interest rate options, respectively,
were relocated into certain provisions in
Cboe Options Chapter 7 (former Cboe
Options Chapter 15, which C2 does
incorporate by reference). Therefore, the
proposed rule change makes explicit,
where applicable, that Cboe Options
rules regarding such options specific to
trading on Cboe Options, as well as
other specific Cboe Options rules not
currently incorporated by reference into
C2 Rules, continue to be inapplicable to
C2.
The proposed rule change also
updates certain rules under current C2
Rule 17.50 (proposed C2 Rule 13.15) to
reflect recent changes to the
corresponding Cboe Options rules.21
20 Relocated to Cboe Options Rules 4.17, 7.6, 8.20,
8.21, and 8.22, respectively. The Exchange also
notes that proposed Chapter 5 (current Chapter 4)
updates the cross-reference from Cboe Options Rule
4.11, Interpretation and Policy .06, in the exclusion
provision, to Cboe Options Rule 8.30.06.
21 See Securities Exchange Act Release No. 85727
(April 26, 2019), 84 FR 18878 (May 02, 2019)
(Notice of Filing and Immediate Effectiveness of
Proposed Rule Change To Amend Chapter 17 of the
Cboe Options Rules) (SR–CBOE–2019–025).
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66941
Rule filing SR–CBOE–2019–025
amended Cboe Options Rule
13.15(g)(14) and (g)(19) 22 under its
Minor Rule Violation Plan (‘‘MRVP’’) by
removing referrals to the Business
Conduct Committee (‘‘BCC’’), and
incorporating ‘‘subsequent’’ offenses
under the fine schedules corresponding
to the last monetary range listed under
these rules. For example, instead of
providing that subsequent offenses may
result in referral to the BCC, Cboe
Options Rule 13.15(g)(14) now provides
that a first offense may result in a fine
of $2,000 to $4,000, and subsequent
offenses may result in a fine ranging
from $4,000 to $5,000. The Exchange
notes that it does not incorporate Cboe
Options Rules 13.15(g)(14) or (g)(19)
(i.e., current C2 Rules 17.50(g)(14) and
(g)(19)) by reference, therefore, it now
proposes to update these MRVP rules to
be consistent with Cboe Options in its
schedule of fines under proposed C2
Rules 13.15(g)(14) and (g)(19) (current
C2 Rules 17.50(g)(14) and (g)(19)).
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.23 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 24 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) 25 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
generally makes no substantive changes
to the rules. The proposed rule change
is merely intended to reorganize C2
Chapters and update their numbers,
22 The Exchange notes that at the time of this
filing these rules were under Chapter 17 in the Cboe
Options Rulebook, and have since been relocated to
Chapter 13 as a result of the migration.
23 15 U.S.C. 78f(b).
24 15 U.S.C. 78f(b)(5).
25 Id.
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cross-references, and headings, as well
as remove C2 Chapters which reference
Cboe Options chapters that are no
longer applicable and/or are covered
under other proposed C2 Chapters as a
result of the Cboe Options rulebook
restructuring, in order to correspond to
the Cboe Options rulebook that was
reorganized for the October 7, 2019
technology migration. The proposed
change also updates language in certain
C2 Chapters that incorporate Cboe
Options chapters by reference to
exclude Cboe Options rules regarding
specific types of options and other
specific Cboe Options rules that are not
applicable to trading on C2, but, as a
result of the Cboe Options rulebook
reorganization, had been relocated into
Cboe Options chapters that C2 currently
does incorporate by reference.
Additionally, the proposed change adds
rule text to the C2 Rules that is identical
to certain Cboe Options rules formerly
in Cboe Options Chapter 24, which the
Exchange currently incorporates by
reference, which were relocated to Cboe
Options chapters not incorporated by
reference. Therefore, the proposed rule
change does not alter any of the current
rules incorporated by reference, and the
same rules currently applicable to
Trading Permit Holders will apply to
Trading Permit Holders upon
effectiveness of this rule filing in the
same manner, whether those rules are
incorporated by reference to Cboe
Options rules or included in C2’s Rules.
Instead, it is designed 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 updating the
organization and structure of the C2
Rulebook in order to align with the
recently reorganized and restructured
Cboe Options rulebook, making it easier
to read and follow, thus allowing market
participants better understand the rules
of the Exchange, which will also result
in less burdensome and more efficient
regulatory compliance for market
participants that are Trading Permit
Holders of both Cboe Options and C2.
Additionally, the Exchange notes that
the removal of a referral to the BCC for
subsequent offenses under the proposed
MRVP Rules 13.15(g)(14) and (g)(19) is
substantively identical to the
corresponding rules of Cboe Options,
which have previously been filed with
the Commission. As a result, the
Exchange believes that the proposed
change provides consistency between
the rules and disciplinary process of the
Exchange and its affiliate exchange,
Cboe Options, which removes
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16:11 Dec 05, 2019
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impediments to and perfects the
mechanism of a free and open market
and a national market system by making
it easier for participants across the
affiliated exchanges to understand and
adhere to the disciplinary rules.
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 that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
Exchange reiterates that the proposed
rule change is being proposed as a result
of the recent technology migration and
the related reorganization of the Cboe
Options rulebook, and not as a
competitive filing. The Exchange does
not believe that the proposed rule
change will impose any burden on
intramarket competition because it
merely reorganizes and updates its
Chapters and Rules that incorporate
Cboe Options chapters and rules by
reference to align with the reorganized,
post-migration Cboe Options rulebook
that became effective October 7, 2019.
The same rules that apply to C2 Trading
Permit Holders today will apply to C2
Trading Permit Holders in the same
manner upon effectiveness of this rule
filing. Likewise, the proposed rule
change to the C2 MRVP is also not
intended to address competitive issues
and will not impose any burden on
intramarket competition because it does
not impact trading on the Exchange but,
rather, is concerned only with
facilitating easier understanding of and
adherence to the disciplinary rules for
participants across the Exchange and
Cboe Options. The Exchange does not
believe that the proposed rule change
will impose any burden on intermarket
competition because the proposed rules
are substantively the same as the
Exchange’s current rules, and the
proposed change to the MRVP is
substantively the same as the Cboe
Options MRVP, all of which have 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
Because the proposed rule change
does not (i) significantly affect the
protection of investors or the public
interest; (ii) impose any significant
PO 00000
Frm 00073
Fmt 4703
Sfmt 4703
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 26 and Rule 19b–
4(f)(6) thereunder.27
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 28 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b–4(f)(6)(iii) 29
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 believes that
relocating and updating the C2 Chapters
to align the C2 Rulebook with the
restructured, post-migration Cboe
Options rulebook will help to avoid any
potential confusion by providing
investors with a C2 Rulebook that
accurately incorporates Cboe Options
rules and chapters by reference. The
Commission believes the waiver of the
operative delay is consistent with the
protection of investors and the public
interest. Therefore, the Commission
hereby waives the operative delay and
designates the proposal operative upon
filing.30
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,
26 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). As required under Rule
19b–4(f)(6)(iii), the Exchange provided the
Commission with written notice of its intent to file
the proposed rule change, along with a brief
description and the text of the proposed rule
change, at least five business days prior to the date
of filing of the proposed rule change, or such
shorter time as designated by the Commission.
28 17 CFR 240.19b–4(f)(6).
29 17 CFR 240.19b–4(f)(6)(iii).
30 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).
27 17
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Federal Register / Vol. 84, No. 235 / Friday, December 6, 2019 / Notices
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–
C2–2019–025 on the subject line.
lotter on DSKBCFDHB2PROD with NOTICES
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–C2–2019–025. 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–C2–2019–025 and should
be submitted on or before December 27,
2019.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.31
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019–26308 Filed 12–5–19; 8:45 am]
BILLING CODE 8011–01–P
31 17
CFR 200.30–3(a)(12).
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–87587A; File No. SR–
CboeBZX–2019–100]
Self-Regulatory Organizations; Cboe
EDGX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Remove Its
Partial Post Only at Limit Order Type;
Correction
December 2, 2019.
Securities and Exchange
Commission.
ACTION: Notice; correction.
AGENCY:
The Securities and Exchange
Commission published a document in
the Federal Register on November 29,
2019, concerning a Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change to Remove its Partial Post
Only at Limit Order Type. The
document contained a typographical
error.
SUMMARY:
FOR FURTHER INFORMATION CONTACT:
Christopher W. Chow, Division of
Trading and Markets, Securities and
Exchange Commission, 100 F Street NE,
Washington, DC 20549, (202) 551–5622.
Correction
In the Federal Register of November
29, 2019 in FR Doc. 25833, on page
65878, in the third and fourth line in the
subheading under the heading
‘‘SECURITIES AND EXCHANGE
COMMISSION’’ in the third column,
correct the reference to ‘‘Cboe EDGX
Exchange, Inc’’ instead to ‘‘Cboe BZX
Exchange, Inc.’’
Dated: December 2, 2019.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019–26299 Filed 12–5–19; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
33707; 812–14967]
Blackstone Alternative Alpha Fund, et
al.
December 2, 2019.
Securities and Exchange
Commission (‘‘Commission’’).
ACTION: Notice.
AGENCY:
Notice of application for an order
under sections 17(d) and 57(i) of the
Investment Company Act of 1940 (the
‘‘Act’’) and rule 17d–1 under the Act to
permit certain joint transactions
otherwise prohibited by sections 17(d)
PO 00000
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Sfmt 4703
66943
and 57(a)(4) of the Act and rule 17d–1
under the Act.
SUMMARY OF APPLICATION: Applicants
request an order to permit business
development companies (‘‘BDCs’’) and
closed-end management investment
companies to co-invest in portfolio
companies with each other and with
certain affiliated investment funds and
accounts.
APPLICANTS: Blackstone Alternative
Alpha Fund (‘‘BAAF’’); Blackstone
Alternative Alpha Fund II (‘‘BAAF II’’);
Blackstone Alternative Alpha Master
Fund (‘‘BAAF Master Fund’’);
Blackstone Alternative Multi-Strategy
Fund (‘‘BAMSF’’, and together with
BAAF, BAAF II and the BAAF Master
Fund, the ‘‘BAAM Regulated Funds’’);
Blackstone Alternative Asset
Management, L.P. (‘‘BAAM’’), the
investment adviser to BAAF, BAAF II
and BAAF Master Fund; Blackstone
Alternative Investment Advisors LLC
(‘‘BAIA’’), the investment adviser to
BAMSF; the investment advisers set
forth in Schedule A to the application
(together with BAAM and BAIA, the
‘‘BAAM Advisers’’); the Existing
Affiliated Investors set forth on
Schedule A to the application.1
FILING DATES: The application was filed
on October 24, 2018, and amended on
June 3, 2019 and September 10, 2019.
HEARING OR NOTIFICATION OF HEARING:
An order granting the requested relief
will be issued unless the Commission
orders a hearing. Interested persons may
request a hearing by writing to the
Commission’s Secretary and serving
applicants with a copy of the request,
personally or by mail. Hearing requests
should be received by the Commission
by 5:30 p.m. on December 27, 2019, and
should be accompanied by proof of
service on applicants, in the form of an
affidavit or, for lawyers, a certificate of
service. Pursuant to rule 0–5 under the
Act, hearing requests should state the
nature of the writer’s interest, any facts
bearing upon the desirability of a
hearing on the matter, the reason for the
request, and the issues contested.
Persons who wish to be notified of a
hearing may request notification by
writing to the Commission’s Secretary.
ADDRESSES: Secretary, U.S. Securities
and Exchange Commission, 100 F St.
NE, Washington, DC 20549–1090.
1 The Existing Affiliated Investors, together with
their direct and indirect wholly-owned subsidiaries,
are entities (i) whose primary investment adviser is
a BAAM Adviser and (ii) that either (A) would be
an investment company but for section 3(c)(1),
3(c)(5)(C) or 3(c)(7) of the Act or (B) rely on the rule
3a–7 exemption thereunder from investment
company status.
E:\FR\FM\06DEN1.SGM
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]]>Agencies
[Federal Register Volume 84, Number 235 (Friday, December 6, 2019)]
[Notices]
[Pages 66938-66943]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-26308]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-87646; File No. SR-C2-2019-025]
Self-Regulatory Organizations; Cboe C2 Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change Updating
Various C2 Rules and Chapters To Reflect Changes to the Cboe Options
Rulebook
December 2, 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 November 20, 2019, Cboe C2 Exchange, Inc. (the ``Exchange'' or
``C2'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the Exchange. The Exchange
filed the proposal as a ``non-controversial'' proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6) thereunder.\4\ The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Cboe C2 Exchange, Inc. (the ``Exchange'' or ``C2'') proposes to
update various C2 Rules and Chapters to reflect
[[Page 66939]]
changes to the Cboe Options rulebook that became effective upon the
October 7, 2019 migration of the Cboe Options' trading platform to the
same system used by the Cboe Affiliated Exchanges (as defined below),
including C2. 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://markets.cboe.com/us/options/regulation/rule_filings/ctwo/), 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''). On October 7, 2019, Cboe Options migrated its trading
platform to the same system used by the Cboe Affiliated Exchanges. In
connection with this technology migration, Cboe Options updated and
reorganized its rulebook, which became effective upon the technology
migration.
The Exchange now proposes to reorganize various Chapters in its
Rulebook that incorporate Cboe Options chapters by reference in order
to correspond to the post-migration structure of the Cboe Options
rulebook. The proposed rule change also updates cross-references to
Cboe Options rules and chapters that have been relocated in the Cboe
Options post-migration rulebook. It also proposes to delete certain
Chapters that incorporate by reference Cboe Option's chapters that are
no longer holistically in the Cboe Options rulebook as a result of the
reorganization of the rules under such chapters to various other Cboe
Options rules and chapters. The proposed rule change moves and, where
applicable, removes the rules as follows:
------------------------------------------------------------------------
Proposed Chapter Current Rule/Chapter
------------------------------------------------------------------------
Chapter 3, Section B TPH Chapter 9 Doing Business with the
Registration 5 Public
Incorporates by reference certain Incorporates by reference certain
Cboe Options rules under Cboe rules under former Cboe Options
Options Chapter 3, Section B Chapter 9 (former Cboe Options
(rules formerly under Cboe Options Rules 9.1, 9.2, 9.3, 9.3A, 9.4,
Chapter 9).6 9.5, 9.6).
Rule 3.30. Rule 3.4.
------------------------------------------------------------------------
Chapter 4, Section A Equity and ETP Chapter 5 Securities Dealt In
Options
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 4, Section A Cboe Options Chapter 5; and
(former Cboe Options Chapter 5); 7
and
Chapter 4, Section B Index Options Chapter 24 Index Options
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 4, Section B Cboe Options Chapter 24 (except
(rules regarding index options for former Rules 24.6, 24.7,
listing under former Cboe Options 24.13, 24.15, 24.19, 24.20, and
Chapter 24).8 24.21).
------------------------------------------------------------------------
Chapter 5 Business Conduct 9 Chapter 4 Business Conduct
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 8 (comprised of Cboe Options Chapter 4; and
former Cboe Options Chapter 4, as Chapter 24 Index Options
well as rules regarding position Incorporates by reference former
limits and exercise limits for Cboe Options Chapter 24.
index options under former Cboe
Chapter 24).10
------------------------------------------------------------------------
Chapter 6, Section F Exercises and Chapter 11 Exercises and Deliveries
Deliveries
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 6, Section B Cboe Options Chapter 11
(former Cboe Options Chapter 11, Chapter 24 Index Options
as well as former Cboe Options Incorporates by reference former
Rule 24.18). Cboe Options Chapter 24.
------------------------------------------------------------------------
Chapter 7, Section A General Chapter 15 Records, Reports, and
Audits
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 7, Section A Cboe Options Chapter 15.
(former Cboe Options Chapter 15);
and
Chapter 7, Section B Consolidated Chapter 6, Section F Consolidated
Audit Trail (CAT) Audit Trail (CAT)
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 7, Section B Cboe Options Chapter 6, Section F.
(which was former Cboe Options
Chapter 6, Section F (Consolidated
Audit Trail (CAT)).11
------------------------------------------------------------------------
Chapter 9 Doing Business with the Chapter 9 Doing Business with the
Public Public
Removes Rule 3.19, which is Incorporates by reference certain
identical to Cboe Options Rule rules under Cboe Options Chapter 9
9.20, and incorporates by (Rules 9.7 through 9.25).
reference Cboe Options Rule 9.20
(which becomes incorporated by
reference under the umbrella of
the overall incorporation by
reference of Cboe Options Chapter
9).12
------------------------------------------------------------------------
Chapter 10 Margin Requirements Chapter 12 Margins
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 10 (former Cboe Cboe Options Chapter 12.
Options Chapter 12).13
------------------------------------------------------------------------
Chapter 11 Net Capital Requirements Chapter 13 Net Capital Requirements
[[Page 66940]]
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 11 (former Cboe Cboe Options Chapter 13.
Options Chapter 13).14
------------------------------------------------------------------------
Chapter 12 Summary Suspension Chapter 16 Summary Suspension
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 12 (former Cboe Cboe Options Chapter 16.
Options Chapter 16), and as a
result deletes current C2 Chapter
16.15
------------------------------------------------------------------------
Chapter 13 Discipline Chapter 17 Discipline
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 13 (former Cboe Cboe Options Chapter 17.
Options Chapter 17), and as a
result deletes current C2 Chapter
17.16
------------------------------------------------------------------------
Chapter 14 Arbitration Chapter 18 Arbitration
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 14 (former Cboe Cboe Options Chapter 18.
Options Chapter 18), and as a
result deletes current C2 Chapter
18.17
------------------------------------------------------------------------
Chapter 15 Hearings and Review Chapter 19 Hearings and Review
Incorporates by reference Cboe Incorporates by reference former
Options Chapter 15 (former Cboe Cboe Options Chapter 19.
Options Chapter 19), and as a
result deletes current C2 Chapter
19.18
------------------------------------------------------------------------
To be deleted Chapter 10 Closing Transactions
------------------------------------------------------------------------
To be deleted Chapter 24 Index Options
------------------------------------------------------------------------
The majority of the proposed changes are of a non-substantive
nature and will not amend the relocated rules other than to update
their Chapter numbers, make cross-reference changes, update or remove
references to certain terms that have been updated or removed within
the Cboe Options rules (e.g. ``Department of Compliance'', ``Department
of Financial and Sales Practice Compliance'', and ``Department of
Member Firm Regulation'' were all updated to the ``Exchange'' in Cboe
Options rules, reference to the Floor is not found in any Cboe Options
rules that remain in Cboe Options Chapter 9, and the terms
``Constitution'' and ``membership are not found in Cboe Options Chapter
15 (Hearing and Review)) and update headings in order to correspond to
the structure of the Cboe Options post-migration Rulebook. The Exchange
notes it also updates cross-references to Cboe Options rules in C2 Rule
6.1 and in C2 Chapter 6, Section E, and removes the language under C2
Rule 1.3 that makes an exception for the applicability of Eastern Time
in Cboe Options rules because the Cboe Options post-migration Rulebook
was amended to also state all times in Eastern Time.\19\
---------------------------------------------------------------------------
\5\ The proposed rule change also adds a Section A (TPH
Qualifications) heading to C2 Rules currently in Chapter 3, which is
consistent with the section structure in Cboe Options Chapter 3.
\6\ The filing to reorganize Cboe Options Chapter 9 and move
rules to Cboe Options Chapter 3, Section B did not make any
substantive changes to the rules. See Securities and Exchange Act
Release No. 87229 (October 4, 2019), 84 FR 54704 (October 10, 2019)
(SR-CBOE-2019-088).
\7\ The filing to relocate former Cboe Options Chapter 5 to Cboe
Options Chapter 4, Section A did not make any substantive changes to
the rules. See Securities and Exchange Act Release No. 87272
(October 10, 2019) (SR-CBOE-2019-090).
\8\ The filing to relocate rules regarding the listing of index
options under former Cboe Options Chapter 24 to Cboe Options Chapter
4, Section B did not make any substantive changes to the rules. See
Securities Exchange Act Release No. 87337 (October 17, 2019), 84 FR
56879 (October 23, 2019) (SR-CBOE-2019-092).
\9\ The Exchange notes that proposed C2 Chapter 5 incorporates
by reference Cboe Options Chapter 8, as current C2 Chapter 8 is
already comprised of C2 Market-Maker Rules.
\10\ The filing to relocate former Cboe Options Chapter 4, as
well as rules regarding position limits and exercise limits for
index options under former Cboe Chapter 24, to Cboe Options Chapter
8 did not make any substantive changes to the rules. See Securities
Exchange Act Release No. 87224 (October 4, 2019), 84 FR 54652
(October 10, 2019) (SR-CBOE-2019-081).
\11\ The filing to relocate former Cboe Options Chapter 15, as
well as former Cboe Options Chapter 6, Section F, to Cboe Options
Chapter 7, Sections A and B, did not make any substantive changes to
the rules. See Securities Exchange Act Release No. 87216 (October 3,
2019), 84 FR 54231 (October 9, 2019) (SR-CBOE-2019-073).
\12\ See supra note 5.
\13\ The filing to relocate former Cboe Options Chapter 12 to
Cboe Options Chapter 10 did not make any substantive changes to the
rules. See Securities Exchange Act Release No. 87189 (October 1,
2019), 84 FR 53520 (October 7, 2019) (SR-CBOE-2019-069).
\14\ The filing to relocate former Cboe Options Chapter 13 to
Cboe Options Chapter 11 did not make any substantive changes to the
rules. See Securities Exchange Act Release No. 87188 (October 1,
2019), 84 FR 53480 (October 7, 2019) (SR-CBOE-2019-066).
\15\ The filing to relocate former Cboe Options Chapter 16 to
Cboe Options Chapter 12 did not make any substantive changes to the
rules. See Securities Exchange Act Release No. 87227 (October 4,
2019), 84 FR 54700 (October 10, 2019) (SR-CBOE-2019-067).
\16\ The filing to relocate former Cboe Options Chapter 17 to
Cboe Options Chapter 13 did not make any substantive changes to the
rules. See Securities Exchange Act Release No. 87210 (October 3,
2019), 84 FR 54190 (October 9, 2019) (SR-CBOE-2019-068).
\17\ The filing to relocate former Cboe Options Chapter 18 to
Cboe Options Chapter 14 did not make any substantive changes to the
rules. See Securities Exchange Act Release No. 87183 (October 1,
2019), 84 FR 53548 (October 7, 2019) (SR-CBOE-2019-065).
\18\ The filing to relocate former Cboe Options Chapter 19 to
Cboe Options Chapter 15 did not make any substantive changes to the
rules. See Securities Exchange Act Release No. 87187 (October 1,
2019), 84 FR 53487 (October 7, 2019) (SR-CBOE-2019-072).
\19\ See Cboe Options Rule 1.6.
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As stated in the table above, the proposed rule change also
incorporates Cboe Options Rule 9.20, which governs customer disclosures
during Global Trading Hours, into C2 Chapter 9 by reference to Cboe
Options Chapter 9. Current Rule 3.19 is identical to Cboe Options Rule
9.20. Therefore, the proposed rule change essentially just relocates
current Rule 3.19 to Rule 9.20 in order to include Cboe Options Rule
9.20 in C2 Chapter 9's incorporation of Cboe Options Chapter 9 by
reference, as it is within the same category of exchange rules
otherwise incorporated into C2 Chapter 9 by reference to Cboe Options
Chapter 9 (i.e. rule related to doing business with the public).
The proposed changes to remove certain C2 Chapters are of a non-
substantive nature because they delete C2 Chapters that incorporate by
reference certain Cboe Options chapters that are no longer applicable
as a result of the reorganization of the Cboe Options rulebook. The
proposed rule change removes current C2 Chapter 10 which incorporates
(former) Cboe Options Chapter 10 by reference. The Exchange notes that
prior to reorganization, Cboe Options Chapter 10 contained only three
rules (Cboe Options Rules 10.1, 10.2, and 10.3). As a result of Cboe
Option's reorganization, Cboe Options Rule 10.1 was relocated to
[[Page 66941]]
Cboe Options Rule 6.3(g), Cboe Options Rule 10.2 was relocated to Cboe
Options Rule 12.6, and Cboe Options Rule 10.3 was relocated to Cboe
Options Rule 8.18. The Exchange notes that proposed C2 Chapter 12
incorporates Cboe Options Chapter 12 by reference, which now contains
former Cboe Options Rule 10.2, and proposed C2 Chapter 5 incorporates
Cboe Options Chapter 8 by reference, which now contains former Cboe
Options Rule 10.3. Because the current C2 Rules do not incorporate Cboe
Options Chapter 6 by reference, the proposed rule change simply adds
the language, verbatim, from current Cboe Options Rule 6.3(g) (former
Cboe Options Rule 10.1) to C2 Rule 6.27(b) (and updates the current
rule text paragraph formatting and headings accordingly).
Likewise, the proposed change removes current C2 Chapter 24 which
incorporates (former) Cboe Options Chapter 24 by reference. As
indicated in the table above, a majority of the Cboe Options rules
under former Cboe Options Chapter 24 were relocated to Cboe Options
Chapter 4, Section B and Chapter 8, and thus covered under proposed C2
Chapters 4 and 5. The Exchange notes that former Cboe Options Rule 24.8
(governing the meaning of premium bids and offers for index options)
and former Cboe Options Rule 24.14 (governing limitation of liability
of Reporting Authority for indexes underlying options) were not
relocated into either of these Chapters, and instead incorporated into
Cboe Options Rules 5.3(a) and 1.12, respectively. Because the current
C2 Rules do not incorporate post-migration Cboe Options Chapter 5 or
Chapter 1 by reference, like the proposed rule change described above,
the proposed rule change simply updates the language under current C2
Rule 6.3(a) to be consistent with the rule text under corresponding
Cboe Options Rule 5.3(a), which now accounts for index options (from
former Cboe Options Rule 24.8), and adds Rule 6.45, which is identical
to the rule text under Cboe Options Rule 1.12 (former Cboe Options Rule
24.14). The proposed rule change does not incorporate former Cboe
Options Rule 24.8.01 (current Cboe Options Rule 5.85(e)) nor former
Cboe Options Rule 24.22 (current Cboe Options Rule 5.92) because both
rules are specific to trading on open outcry which is not applicable to
C2. The proposed change also removes the language under current C2
Chapter 24 which provides that Cboe Options Rules 24.6 (Days and Hours
of Business); 24.7 (Trading Halts, Suspensions, or Primary Market
Closure); 24.13 (Trading Rotations); 24.15 (Automatic Execution of
Index Options); 24.19 (Multi-Class Broad-Based Index Option Spread
Orders); 24.20 (SPX Combination Orders); and 24.21 (Index Crowd Space
Dispute Resolution Procedures) do not apply to C2, because, as a result
of the reorganization of the Cboe Options rulebook, each of these rules
has either been deleted from the Cboe Options rulebook or relocated
into another Cboe Options chapter that C2 does not incorporate by
reference. The Exchange notes that the proposed rule changes described
above do not make any substantive changes to the manner in which Cboe
Options rules apply to C2.
Additionally, as a result of the reorganization of the Cboe Options
rulebook, rules in certain former chapters that the Exchange does not
currently incorporate by reference, such as chapters that had governed
types of options specific to trading on Cboe Options (i.e. Range,
Binary, Corporate Debt Security, Government security, Credit, and
interest rate options), and other specific Cboe Options rules that do
not apply to C2 (i.e. former Cboe Options Rules 6.2.06, 8.9, 8.6, 6.55,
and 6.22),\20\ were relocated to various Cboe Options chapters that C2
currently does incorporate by reference. For example, former Cboe
Options Rules 28.16, 21.30, and 23.15 (none of which does C2 currently
incorporate by reference) regarding record maintenance, retention, and
furnishing for Market-Makers in Corporate Debt Security Options,
Government security options, and interest rate options, respectively,
were relocated into certain provisions in Cboe Options Chapter 7
(former Cboe Options Chapter 15, which C2 does incorporate by
reference). Therefore, the proposed rule change makes explicit, where
applicable, that Cboe Options rules regarding such options specific to
trading on Cboe Options, as well as other specific Cboe Options rules
not currently incorporated by reference into C2 Rules, continue to be
inapplicable to C2.
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\20\ Relocated to Cboe Options Rules 4.17, 7.6, 8.20, 8.21, and
8.22, respectively. The Exchange also notes that proposed Chapter 5
(current Chapter 4) updates the cross-reference from Cboe Options
Rule 4.11, Interpretation and Policy .06, in the exclusion
provision, to Cboe Options Rule 8.30.06.
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The proposed rule change also updates certain rules under current
C2 Rule 17.50 (proposed C2 Rule 13.15) to reflect recent changes to the
corresponding Cboe Options rules.\21\ Rule filing SR-CBOE-2019-025
amended Cboe Options Rule 13.15(g)(14) and (g)(19) \22\ under its Minor
Rule Violation Plan (``MRVP'') by removing referrals to the Business
Conduct Committee (``BCC''), and incorporating ``subsequent'' offenses
under the fine schedules corresponding to the last monetary range
listed under these rules. For example, instead of providing that
subsequent offenses may result in referral to the BCC, Cboe Options
Rule 13.15(g)(14) now provides that a first offense may result in a
fine of $2,000 to $4,000, and subsequent offenses may result in a fine
ranging from $4,000 to $5,000. The Exchange notes that it does not
incorporate Cboe Options Rules 13.15(g)(14) or (g)(19) (i.e., current
C2 Rules 17.50(g)(14) and (g)(19)) by reference, therefore, it now
proposes to update these MRVP rules to be consistent with Cboe Options
in its schedule of fines under proposed C2 Rules 13.15(g)(14) and
(g)(19) (current C2 Rules 17.50(g)(14) and (g)(19)).
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\21\ See Securities Exchange Act Release No. 85727 (April 26,
2019), 84 FR 18878 (May 02, 2019) (Notice of Filing and Immediate
Effectiveness of Proposed Rule Change To Amend Chapter 17 of the
Cboe Options Rules) (SR-CBOE-2019-025).
\22\ The Exchange notes that at the time of this filing these
rules were under Chapter 17 in the Cboe Options Rulebook, and have
since been relocated to Chapter 13 as a result of the migration.
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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.\23\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \24\ 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) \25\ requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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\23\ 15 U.S.C. 78f(b).
\24\ 15 U.S.C. 78f(b)(5).
\25\ Id.
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As stated, the proposed rule change generally makes no substantive
changes to the rules. The proposed rule change is merely intended to
reorganize C2 Chapters and update their numbers,
[[Page 66942]]
cross-references, and headings, as well as remove C2 Chapters which
reference Cboe Options chapters that are no longer applicable and/or
are covered under other proposed C2 Chapters as a result of the Cboe
Options rulebook restructuring, in order to correspond to the Cboe
Options rulebook that was reorganized for the October 7, 2019
technology migration. The proposed change also updates language in
certain C2 Chapters that incorporate Cboe Options chapters by reference
to exclude Cboe Options rules regarding specific types of options and
other specific Cboe Options rules that are not applicable to trading on
C2, but, as a result of the Cboe Options rulebook reorganization, had
been relocated into Cboe Options chapters that C2 currently does
incorporate by reference. Additionally, the proposed change adds rule
text to the C2 Rules that is identical to certain Cboe Options rules
formerly in Cboe Options Chapter 24, which the Exchange currently
incorporates by reference, which were relocated to Cboe Options
chapters not incorporated by reference. Therefore, the proposed rule
change does not alter any of the current rules incorporated by
reference, and the same rules currently applicable to Trading Permit
Holders will apply to Trading Permit Holders upon effectiveness of this
rule filing in the same manner, whether those rules are incorporated by
reference to Cboe Options rules or included in C2's Rules. Instead, it
is designed 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 updating the organization
and structure of the C2 Rulebook in order to align with the recently
reorganized and restructured Cboe Options rulebook, making it easier to
read and follow, thus allowing market participants better understand
the rules of the Exchange, which will also result in less burdensome
and more efficient regulatory compliance for market participants that
are Trading Permit Holders of both Cboe Options and C2.
Additionally, the Exchange notes that the removal of a referral to
the BCC for subsequent offenses under the proposed MRVP Rules
13.15(g)(14) and (g)(19) is substantively identical to the
corresponding rules of Cboe Options, which have previously been filed
with the Commission. As a result, the Exchange believes that the
proposed change provides consistency between the rules and disciplinary
process of the Exchange and its affiliate exchange, Cboe Options, which
removes impediments to and perfects the mechanism of a free and open
market and a national market system by making it easier for
participants across the affiliated exchanges to understand and adhere
to the disciplinary rules.
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 that is not necessary or appropriate
in furtherance of the purposes of the Act. The Exchange reiterates that
the proposed rule change is being proposed as a result of the recent
technology migration and the related reorganization of the Cboe Options
rulebook, and not as a competitive filing. The Exchange does not
believe that the proposed rule change will impose any burden on
intramarket competition because it merely reorganizes and updates its
Chapters and Rules that incorporate Cboe Options chapters and rules by
reference to align with the reorganized, post-migration Cboe Options
rulebook that became effective October 7, 2019. The same rules that
apply to C2 Trading Permit Holders today will apply to C2 Trading
Permit Holders in the same manner upon effectiveness of this rule
filing. Likewise, the proposed rule change to the C2 MRVP is also not
intended to address competitive issues and will not impose any burden
on intramarket competition because it does not impact trading on the
Exchange but, rather, is concerned only with facilitating easier
understanding of and adherence to the disciplinary rules for
participants across the Exchange and Cboe Options. The Exchange does
not believe that the proposed rule change will impose any burden on
intermarket competition because the proposed rules are substantively
the same as the Exchange's current rules, and the proposed change to
the MRVP is substantively the same as the Cboe Options MRVP, all of
which have 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
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, it has become effective pursuant to Section
19(b)(3)(A) of the Act \26\ and Rule 19b-4(f)(6) thereunder.\27\
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\26\ 15 U.S.C. 78s(b)(3)(A).
\27\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written
notice of its intent to file the proposed rule change, along with a
brief description and the text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \28\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \29\ 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
believes that relocating and updating the C2 Chapters to align the C2
Rulebook with the restructured, post-migration Cboe Options rulebook
will help to avoid any potential confusion by providing investors with
a C2 Rulebook that accurately incorporates Cboe Options rules and
chapters by reference. The Commission believes the waiver of the
operative delay is consistent with the protection of investors and the
public interest. Therefore, the Commission hereby waives the operative
delay and designates the proposal operative upon filing.\30\
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\28\ 17 CFR 240.19b-4(f)(6).
\29\ 17 CFR 240.19b-4(f)(6)(iii).
\30\ 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 change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing,
[[Page 66943]]
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-C2-2019-025 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-C2-2019-025. 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-C2-2019-025 and should be submitted on
or before December 27, 2019.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\31\
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\31\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-26308 Filed 12-5-19; 8:45 am]
BILLING CODE 8011-01-P
