Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 21.5 by Extending the Penny Pilot Program Through June 30, 2020, 69805-69807 [2019-27344]
Download as PDF
Federal Register / Vol. 84, No. 244 / Thursday, December 19, 2019 / Notices
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
Phlx–2019–55 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.
lotter on DSKBCFDHB2PROD with NOTICES
All submissions should refer to File
Number SR–Phlx–2019–55. 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–Phlx–2019–55 and should
be submitted on or before January 9,
2020.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.15
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2019–27350 Filed 12–18–19; 8:45 am]
BILLING CODE 8011–01–P
15 17
19:13 Dec 18, 2019
[Release No. 34–87741; File No. SR–
CboeEDGX–2019–074]
Self-Regulatory Organizations; Cboe
EDGX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Amend Rule
21.5 by Extending the Penny Pilot
Program Through June 30, 2020
December 13, 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 December
10, 2019, Cboe EDGX Exchange, Inc.
(the ‘‘Exchange’’ or ‘‘EDGX’’) 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 ‘‘noncontroversial’’ 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 EDGX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘EDGX’’) proposes to
amend Rule 21.5 by extending the
Penny Pilot Program through June 30,
2020. The text of the proposed rule
change is provided below.
(additions are in italics; deletions are
[bracketed])
*
*
*
*
*
Rules of Cboe EDGX Exchange, Inc.
*
*
*
*
*
Rule 21.5. Minimum Increments
*
*
*
*
*
Interpretations and Policies
.01 The Exchange will operate a
pilot program set to expire on
[December 31, 2019] June 30, 2020 to
permit options classes to be quoted and
traded in increments as low as $.01. The
Exchange will specify which options
trade in such pilot, and in what
increments, in Information Circulars
distributed to Members and posted on
the Exchange’s website. The Exchange
may replace any penny pilot issues that
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
CFR 200.30–3(a)(12).
VerDate Sep<11>2014
SECURITIES AND EXCHANGE
COMMISSION
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69805
have been delisted with the next most
actively traded multiply listed options
classes that are not yet included in the
penny pilot, based on trading activity in
the previous six months. The
replacement issues may be added to the
penny pilot on the second trading day
in the first month of each quarter.
*
*
*
*
*
The text of the proposed rule change
is also available on the Exchange’s
website (https://markets.cboe.com/us/
options/regulation/rule_filings/edgx/),
at the Exchange’s Office of the
Secretary, and at the Commission’s
Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Pilot Program is scheduled to
expire on December 31, 2019. The
Exchange proposes to extend the Pilot
Program until June 30, 2020. The
Exchange believes that extending the
Pilot Program will allow for further
analysis of the Pilot Program and a
determination of how the Pilot Program
should be structured in the future. The
Exchange is specifically authorized to
act jointly with the other options
exchanges participating in the Pilot
Program in identifying any replacement
class. The Exchange also represents that
the Exchange has the necessary system
capacity to continue to support
operation of the Pilot Program. The
Exchange believes the benefits to public
customers and other market participants
who will be able to express their true
prices to buy and sell options have been
demonstrated to outweigh the increase
in quote traffic.
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
E:\FR\FM\19DEN1.SGM
19DEN1
69806
Federal Register / Vol. 84, No. 244 / Thursday, December 19, 2019 / Notices
lotter on DSKBCFDHB2PROD with NOTICES
thereunder applicable to the Exchange
and, in particular, the requirements of
Section 6(b) of the Act.5 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 6 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) 7 requirement that
the rules of an exchange not be designed
to permit unfair discrimination between
customers, issuers, brokers, or dealers.
In particular, the proposed rule change
allows for an extension of the Pilot
Program prior to its expiration on
December 31, 2019 for the benefit of
market participants. The Exchange
believes that the Pilot Program promotes
just and equitable principles of trade by
enabling public customers and other
market participants to express their true
prices to buy and sell options. The
Exchange notes that this proposal does
not propose any new policies or
provisions that are unique or unproven,
but instead relates to the continuation of
an existing program that operates on a
pilot basis.
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. Specifically,
the Exchange believes that, by extending
the expiration of the Pilot Program, the
proposed rule change will allow for
further analysis of the Pilot Program and
a determination of how the Program
should be structured in the future. In
doing so, the proposed rule change will
also serve to promote regulatory clarity
and consistency, thereby reducing
burdens on the marketplace and
facilitating investor protection. In
addition, the Exchange has been
authorized to act jointly in extending
the Pilot Program and believes the other
exchanges will be filing similar
extensions.
5 15
6 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
7 Id.
VerDate Sep<11>2014
19:13 Dec 18, 2019
Jkt 250001
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 filed the proposed rule
change pursuant to Section 19(b)(3)(A)
of the Act 8 and Rule 19b–4(f)(6) 9
thereunder. Because the foregoing
proposed rule change does not (i)
significantly affect the protection of
investors or the public interest; (ii)
impose any significant burden on
competition; and (iii) become operative
for 30 days from the date on which it
was filed, or such shorter time as the
Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 10 and Rule 19b–
4(f)(6) 11 thereunder.
A proposed rule changed filed under
Rule 19b–4(f)(6) 12 normally does not
become operative prior to 30 days after
the date of filing. However, pursuant to
Rule 19b–4(f)(6),13 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 proposal may become operative
immediately upon filing. The
Commission believes that waiving the
30-day operative delay is consistent
with the protection of investors and the
public interest because doing so will
allow the Pilot Program to continue
without interruption in a manner that is
consistent with the Commission’s prior
approval of the extension and expansion
of the Pilot Program.14 Accordingly, the
Commission designates the proposed
rule change as operative upon filing
with the Commission.15
8 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
10 15 U.S.C. 78s(b)(3)(A).
11 17 CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6) requires a self-regulatory organization to give
the Commission written notice of its intent to file
the proposed rule change at least five business days
prior to the date of filing of the proposed rule
change or just shorter time as designated by the
Commission. The Exchange has satisfied this
requirement.
12 17 CFR 240.19b–4(f)(6).
13 17 CFR 240.19b–4(f)(6)(iii).
14 See Securities Exchange Act Release No. 61061
(November 24, 2009), 74 FR 62857 (December 1,
2009) (SR–NYSEArca–2009–44).
15 For purposes only of waiving the operative
delay for this proposal, the Commission has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
9 17
PO 00000
Frm 00087
Fmt 4703
Sfmt 4703
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission will institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
CboeEDGX–2019–074 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–CboeEDGX–2019–074. 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.
E:\FR\FM\19DEN1.SGM
19DEN1
Federal Register / Vol. 84, No. 244 / Thursday, December 19, 2019 / Notices
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–CboeEDGX–2019–074 and
should be submitted on or before
January 9, 2020.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2019–27344 Filed 12–18–19; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–87747; File No. SR–
CboeEDGX–2019–073]
Self-Regulatory Organizations; Cboe
EDGX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Reflect the
Financial Crimes Enforcement
Network’s Adoption of a Final Rule on
Customer Due Diligence Requirements
for Financial Institutions
December 13, 2019.
lotter on DSKBCFDHB2PROD with NOTICES
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 December
5, 2019, Cboe EDGX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘EDGX’’) 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
Exchange filed the proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of
the Act 3 and Rule 19b–4(f)(6)
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 EDGX Exchange, Inc. (‘‘EDGX’’
or the ‘‘Exchange’’) is filing 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
16 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6).
19:13 Dec 18, 2019
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
I. Background
The Bank Secrecy Act 5 (‘‘BSA’’),
among other things, requires financial
institutions,6 including broker-dealers,
to develop and implement AML
programs that, at a minimum, meet the
statutorily enumerated ‘‘four pillars.’’ 7
These four pillars currently require
broker-dealers to have written AML
programs that include, at a minimum:
• The establishment and
implementation of policies, procedures
and internal controls reasonably
designed to achieve compliance with
the applicable provisions of the BSA
and implementing regulations;
• independent testing for compliance
by broker-dealer personnel or a
qualified outside party;
• designation of an individual or
individuals responsible for
implementing and monitoring the
operations and internal controls of the
AML program; and
• ongoing training for appropriate
persons.8
5 31
U.S.C. 5311, et seq.
U.S.C. 5312(a)(2) (defining ‘‘financial
institution’’).
7 31 U.S.C. 5318(h)(1).
8 31 CFR 1023.210(b).
1 15
VerDate Sep<11>2014
prepared by the Exchange, to reflect the
Financial Crimes Enforcement
Network’s (‘‘FinCEN’’) adoption of a
final rule on Customer Due Diligence
Requirements for Financial Institutions
(‘‘CDD Rule’’). 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/edgx/),
at the Exchange’s Office of the
Secretary, and at the Commission’s
Public Reference Room.
6 See
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69807
In addition to meeting the BSA’s
requirements with respect to AML
programs, Exchange Members 9 must
also comply with Exchange Rule 5.6,
which incorporates the BSA’s four
pillars, as well as requires Members’
AML programs to establish and
implement policies and procedures that
can be reasonably expected to detect
and cause the reporting of suspicious
transactions.
On May 11, 2016, FinCEN, the bureau
of the Department of the Treasury
responsible for administering the BSA
and its implementing regulations,
issued the CDD Rule 10 to clarify and
strengthen customer due diligence for
covered financial institutions,11
including broker-dealers. In its CDD
Rule, FinCEN identifies four
components of customer due diligence:
(1) Customer identification and
verification; (2) beneficial ownership
identification and verification; (3)
understanding the nature and purpose
of customer relationships; and (4)
ongoing monitoring for reporting
suspicious transactions and, on a risk
basis, maintaining and updating
customer information.12 As the first
component is already required to be part
of a broker-dealers AML program under
the BSA, the CDD Rule focuses on the
other three components.
Specifically, the CDD Rule focuses
particularly on the second component
by adding a new requirement that
covered financial institutions identify
and verify the identity of the beneficial
owners of all legal entity customers at
the time a new account is opened,
subject to certain exclusions and
exemptions.13 The CDD Rule also
addresses the third and fourth
components, which FinCEN states ‘‘are
already implicitly required for covered
financial institutions to comply with
their suspicious activity reporting
requirements,’’ by amending the
existing AML program rules for covered
9 See
Exchange Rule 1.5(n).
Customer Due Diligence Requirements
for Financial Institutions; CDD Rule, 81 FR 29397
(May 11, 2016) (CDD Rule Release); 82 FR 45182
(September 28, 2017) (making technical correcting
amendments to the final CDD Rule published on
May 11, 2016). FinCEN is authorized to impose
AML program requirements on financial
institutions and to require financial institutions to
maintain procedures to ensure compliance with the
BSA and associated regulations. 31 U.S.C.
5318(h)(2) and (a)(2). The CDD Rule is the result of
the rulemaking process FinCEN initiated in March
2012. See 77 FR 13046 (March 5, 2012) (Advance
Notice of Proposed Rulemaking) and 79 FR 45151
(Aug. 4, 2014) (Notice of Proposed Rulemaking).
11 See 31 CFR 1010.230(f) (defining ‘‘covered
financial institution’’).
12 See CDD Rule Release at 29398.
13 See 31 CFR 1010.230(d) (defining ‘‘beneficial
owner’’) and 31 CFR 1010.230(e) (defining ‘‘legal
entity customer’’).
10 FinCEN
E:\FR\FM\19DEN1.SGM
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Agencies
[Federal Register Volume 84, Number 244 (Thursday, December 19, 2019)]
[Notices]
[Pages 69805-69807]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-27344]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-87741; File No. SR-CboeEDGX-2019-074]
Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend Rule 21.5 by Extending the Penny Pilot Program Through June 30,
2020
December 13, 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 December 10, 2019, Cboe EDGX Exchange, Inc. (the ``Exchange''
or ``EDGX'') 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 EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX'') proposes to
amend Rule 21.5 by extending the Penny Pilot Program through June 30,
2020. The text of the proposed rule change is provided below.
(additions are in italics; deletions are [bracketed])
* * * * *
Rules of Cboe EDGX Exchange, Inc.
* * * * *
Rule 21.5. Minimum Increments
* * * * *
Interpretations and Policies
.01 The Exchange will operate a pilot program set to expire on
[December 31, 2019] June 30, 2020 to permit options classes to be
quoted and traded in increments as low as $.01. The Exchange will
specify which options trade in such pilot, and in what increments, in
Information Circulars distributed to Members and posted on the
Exchange's website. The Exchange may replace any penny pilot issues
that have been delisted with the next most actively traded multiply
listed options classes that are not yet included in the penny pilot,
based on trading activity in the previous six months. The replacement
issues may be added to the penny pilot on the second trading day in the
first month of each quarter.
* * * * *
The text of the proposed rule change is also available on the
Exchange's website (https://markets.cboe.com/us/options/regulation/rule_filings/edgx/), at the Exchange's Office of the Secretary, and at
the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Pilot Program is scheduled to expire on December 31, 2019. The
Exchange proposes to extend the Pilot Program until June 30, 2020. The
Exchange believes that extending the Pilot Program will allow for
further analysis of the Pilot Program and a determination of how the
Pilot Program should be structured in the future. The Exchange is
specifically authorized to act jointly with the other options exchanges
participating in the Pilot Program in identifying any replacement
class. The Exchange also represents that the Exchange has the necessary
system capacity to continue to support operation of the Pilot Program.
The Exchange believes the benefits to public customers and other market
participants who will be able to express their true prices to buy and
sell options have been demonstrated to outweigh the increase in quote
traffic.
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
[[Page 69806]]
thereunder applicable to the Exchange and, in particular, the
requirements of Section 6(b) of the Act.\5\ Specifically, the Exchange
believes the proposed rule change is consistent with the Section
6(b)(5) \6\ 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) \7\ requirement that the rules of an exchange not be designed
to permit unfair discrimination between customers, issuers, brokers, or
dealers. In particular, the proposed rule change allows for an
extension of the Pilot Program prior to its expiration on December 31,
2019 for the benefit of market participants. The Exchange believes that
the Pilot Program promotes just and equitable principles of trade by
enabling public customers and other market participants to express
their true prices to buy and sell options. The Exchange notes that this
proposal does not propose any new policies or provisions that are
unique or unproven, but instead relates to the continuation of an
existing program that operates on a pilot basis.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(5).
\7\ Id.
---------------------------------------------------------------------------
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. Specifically, the Exchange
believes that, by extending the expiration of the Pilot Program, the
proposed rule change will allow for further analysis of the Pilot
Program and a determination of how the Program should be structured in
the future. In doing so, the proposed rule change will also serve to
promote regulatory clarity and consistency, thereby reducing burdens on
the marketplace and facilitating investor protection. In addition, the
Exchange has been authorized to act jointly in extending the Pilot
Program and believes the other exchanges will be filing similar
extensions.
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 filed the proposed rule change pursuant to Section
19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(6) \9\ thereunder. Because
the foregoing proposed rule change does not (i) significantly affect
the protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative for 30
days from the date on which it was filed, or such shorter time as the
Commission may designate, it has become effective pursuant to Section
19(b)(3)(A) of the Act \10\ and Rule 19b-4(f)(6) \11\ thereunder.
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\8\ 15 U.S.C. 78s(b)(3)(A).
\9\ 17 CFR 240.19b-4(f)(6).
\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change or just shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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A proposed rule changed filed under Rule 19b-4(f)(6) \12\ normally
does not become operative prior to 30 days after the date of filing.
However, pursuant to Rule 19b-4(f)(6),\13\ 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 proposal may
become operative immediately upon filing. The Commission believes that
waiving the 30-day operative delay is consistent with the protection of
investors and the public interest because doing so will allow the Pilot
Program to continue without interruption in a manner that is consistent
with the Commission's prior approval of the extension and expansion of
the Pilot Program.\14\ Accordingly, the Commission designates the
proposed rule change as operative upon filing with the Commission.\15\
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\12\ 17 CFR 240.19b-4(f)(6).
\13\ 17 CFR 240.19b-4(f)(6)(iii).
\14\ See Securities Exchange Act Release No. 61061 (November 24,
2009), 74 FR 62857 (December 1, 2009) (SR-NYSEArca-2009-44).
\15\ For purposes only of waiving the operative delay for this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission will institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-CboeEDGX-2019-074 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-CboeEDGX-2019-074. 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.
[[Page 69807]]
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-CboeEDGX-2019-074 and should
be submitted on or before January 9, 2020.
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\16\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2019-27344 Filed 12-18-19; 8:45 am]
BILLING CODE 8011-01-P