Self-Regulatory Organizations; Cboe Exchange, Inc.; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change To Amend Chapter 7, Section B of the Rules, Which Contains the Exchange's Compliance Rule (“Compliance Rule”) Regarding the National Market System Plan Governing the Consolidated Audit Trail (the “CAT NMS Plan” or “Plan”), To Be Consistent With Certain Proposed Amendments to and Exemptions From the CAT NMS Plan as Well as To Facilitate the Retirement of Certain Existing Regulatory Systems, 26758-26760 [2020-09521]

Download as PDF 26758 Federal Register / Vol. 85, No. 87 / Tuesday, May 5, 2020 / Notices participants. When participants better understand their rights and obligations regarding the Rules, such participants are more likely to act in accordance with the Rules, which FICC believes would promote the prompt and accurate clearance and settlement of securities transactions. As such, FICC believes that the proposed changes would be consistent with Section 17A(b)(3)(F) of the Act.22 (B) Clearing Agency’s Statement on Burden on Competition FICC does not believe the proposed rule changes to (i) delete terms that are no longer used in the GSD Rules; (ii) delete references to services and servicerelated provisions that are no longer provided and/or active in the GSD Rules and the MBSD Rules; (iii) delete certain dates in the GSD Rules and the MBSD Rules; (iv) make certain clarifications in the Rules; (v) make certain corrections to the Rules; (vi) replace an officer title in the GSD Rules and the MBSD Rules; (vii) add a disclaimer regarding trademarks and servicemarks in the Rules and conform the usage of the registered trademark symbol in the GSD Rules; and (viii) make certain technical changes to the Rules would impact competition. The proposed rule changes would help to ensure that the Rules remain clear and accurate. In addition, the changes would facilitate participants’ understanding of the Rules and their obligations thereunder. These changes would not affect FICC’s operations or the rights and obligations of the membership. As such, FICC believes the proposed rule changes would not have any impact on competition. khammond on DSKJM1Z7X2PROD with NOTICES (C) Clearing Agency’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments relating to the proposed rule change have not been solicited or received. FICC will notify the Commission of any written comments received by FICC. III. Date of Effectiveness of the Proposed Rule Change, and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) 23 of the Act and paragraph (f) 24 of Rule 19b–4 thereunder. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend 22 Id. 23 15 24 17 U.S.C 78s(b)(3)(A). CFR 240.19b–4(f). VerDate Sep<11>2014 21:36 May 04, 2020 Jkt 250001 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. 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– FICC–2020–005 on the subject line. Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549. All submissions should refer to File Number SR–FICC–2020–005. 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 FICC and on DTCC’s website (https://dtcc.com/legal/sec-rulefilings.aspx). 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–FICC– PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 2020–005 and should be submitted on or before May 26, 2020. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.25 J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2020–09518 Filed 5–4–20; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–88769; File No. SR–CBOE– 2020–004] Self-Regulatory Organizations; Cboe Exchange, Inc.; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change To Amend Chapter 7, Section B of the Rules, Which Contains the Exchange’s Compliance Rule (‘‘Compliance Rule’’) Regarding the National Market System Plan Governing the Consolidated Audit Trail (the ‘‘CAT NMS Plan’’ or ‘‘Plan’’), To Be Consistent With Certain Proposed Amendments to and Exemptions From the CAT NMS Plan as Well as To Facilitate the Retirement of Certain Existing Regulatory Systems April 29, 2020. I. Introduction On January 17, 2020, Cboe Exchange, Inc. (‘‘Cboe Options’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend the Exchange’s compliance rules regarding the National Market System Plan Governing the Consolidated Audit Trail (‘‘CAT NMS Plan’’).3 The proposed rule change was published for comment in the Federal Register on February 5, 2020.4 On March 20, 2020, the Commission extended the time period within which to approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether to approve or disapprove the proposed rule change, to May 5, 2020.5 25 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 The CAT NMS Plan was approved by the Commission, as modified, on November 15, 2016. See Securities Exchange Act Release No. 79318 (November 15, 2016), 81 FR 84696 (November 23, 2016). 4 See Securities Exchange Act Release No. 88105 (January 30, 2020), 85 FR 6600 (‘‘Notice’’). 5 See Securities Exchange Act Release No. 88437, 85 FR 17129 (March 26, 2020). 1 15 E:\FR\FM\05MYN1.SGM 05MYN1 Federal Register / Vol. 85, No. 87 / Tuesday, May 5, 2020 / Notices The Commission received no comments on the proposal. This order institutes proceedings pursuant to Exchange Act Section 19(b)(2)(B) to determine whether to approve or disapprove File No. SR–CBOE–2020–004.6 II. Description of the Proposed Rule Change The Exchange proposes to amend Chapter 7, Section B of the Exchange’s rulebook (‘‘Compliance Rule’’), which sets forth rules regarding Industry Member 7 compliance with the CAT NMS Plan. Specifically, the proposed rule change would make the following changes to the Compliance Rule to be consistent with certain proposed amendments to and exemption requests submitted by the Participants 8 of the CAT NMS Plan: (1) Revise data reporting requirements for the Firm Designated ID 9 based on a proposed amendment to the CAT NMS Plan filed with the Commission; 10 (2) amend the dates for required testing and reporting in the Compliance Rule for Industry Member reporting; 11 (3) amend the 6 15 U.S.C. 78(s)(b)(2)(B). Member means a member of a national securities exchange or a member of a national securities association. See CAT NMS Plan, supra note 3, at Section 1.1. 8 The Participants include BOX Exchange LLC, Cboe BYX Exchange, Inc., Cboe BZX Exchange, Inc., Cboe C2 Exchange, Inc., Cboe EDGA Exchange, Inc., Cboe EDGX Exchange, Inc., Cboe Exchange, Inc., Financial Industry Regulatory Authority, Inc., Investors’ Exchange LLC, Long-Term Stock Exchange, Inc., Miami International Securities Exchange LLC, MIAX Emerald, LLC, MIAX PEARL, LLC, Nasdaq BX, Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC, Nasdaq PHLX LLC, The Nasdaq Stock Market LLC, New York Stock Exchange LLC, NYSE American LLC, NYSE Arca, Inc., NYSE Chicago, Inc., and NYSE National, Inc. 9 As proposed, ‘‘Firm Designated ID’’ would mean a unique and persistent identifier for each trading account designated by Industry Members for purposes of providing data to the Central Repository, where each such identifier is unique among all identifiers from any given Industry Member; provided, however, such identifier may not be the account number for such trading account if the trading account is not a proprietary account. See proposed CBOE Rule 7.20(r). 10 See Notice, supra note 4, at 6601–02. See also Letter to Vanessa Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan Operating Committee Chair re: Notice of Filing of Amendment to the National Market System Plan Governing the Consolidated Audit Trail (April 14, 2020). The Commission has not approved or disapproved the changes proposed in this amendment. 11 See Notice, supra note 4, at 6605–09. On February 19, 2020, the Participants submitted a request for exemptive relief from the reporting dates required by the CAT NMS Plan. See Letter to Vanessa Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan Operating Committee Chair, re: Request for Exemption from Provisions of the National Market System Plan Governing the Consolidated Audit Trail related to Industry Member Reporting Dates (Feb. 19, 2020). On April 20, 2020, the Commission granted limited exemptive relief to allow for the implementation of phased reporting for Industry Members. See khammond on DSKJM1Z7X2PROD with NOTICES 7 Industry VerDate Sep<11>2014 19:16 May 04, 2020 Jkt 250001 rules to require Industry Members to submit trade reports for executions and cancellations for cancelled trades to the FINRA’s Trade Reporting Facilities, FINRA’s OTC Reporting Facility or FINRA’s Alternative Display Facility; 12 (4) revise the timestamp granularity requirement to require Industry Members with order handling or execution systems that utilize time stamps in increments finer than milliseconds to report timestamps up to nanoseconds when reporting Industry Member data 13 to the Central Repository; 14 (5) revise the reporting requirements for circumstances in which an Industry Member uses an established trading relationship for an individual Customer, instead of an account, on the order reported to CAT; 15 and (6) revise the CAT reporting Securities Exchange Act Release No. 88702 (April 20, 2020), 85 FR 23075 (April 24, 2020). 12 See Notice, supra note 4, at 6609–10. On February 12, 2020, the Participants submitted a request for exemptive relief from the requirement in Sections 6.4(d)(ii)(A)(2) and (B) of the CAT NMS Plan to require Industry Members to record and report, if an order is executed, the SRO-Assigned Market Participant Identifier of the clearing broker, and if a trade is cancelled, the cancelled trade indicator. See Letter to Vanessa Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan Operating Committee Chair, re: Request for Exemption from Certain Provisions of the National Market System Plan Governing the Consolidated Audit Trail related to FINRA Facility Data Linkage (Feb. 12, 2020). If granted, the exemptive relief would revise CAT reporting requirements regarding cancelled trades and SRO-Assigned Market Participant Identifiers of clearing brokers, if applicable, in connection with order executions, as such information would be available from FINRA’s trade reports submitted to CAT. 13 See Notice, supra note 4, at 6610. On February 3, 2020, the Participants filed a request for exemptive relief from the current CAT NMS Plan requirement to record and report Industry Member Data with time stamps consistent with their system, a requirement from which the Exchange requests an exemption. See Letter to Vanessa Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan Operating Committee Chair, re: Request for Exemption from Certain Provisions of the National Market System Plan Governing the Consolidated Audit Trail related to Granularity of Timestamps and Relationship Identifiers (Feb. 3, 2020). On April 8, 2020, the Commission granted the exemptive relief for timestamp granularity. See Securities Exchange Act Release No. 88608 (April 8, 2020), 85 FR 20743 (April 14, 2020). 14 The Central Repository, as defined in the CAT NMS Plan, means ‘‘the repository responsible for the receipt, consolidation, and retention of all information reported to the CAT pursuant to SEC Rule 613 and this Agreement.’’ See CAT NMS Plan, supra note 3, at Section 1.1. 15 See Notice, supra note 4, at 6610–11. On February 3, 2020, the Participants filed a request for exemptive relief from the CAT NMS Plan requirement that Participants, through their Compliance Rules, require Industry Members to record and report to the Central Repository the account number, the date account opened, and the account type for individual customers in circumstances in which an Industry Member uses an established trading relationship for the individual customer. Instead, the Participant would require Industry Members to record and report to PO 00000 Frm 00104 Fmt 4703 Sfmt 4703 26759 requirements so Industry Members would not be required to report to the Central Repository dates of birth, social security numbers, or account numbers for individuals.16 The Exchange also proposes to amend the Exchange’s Compliance Rule to facilitate the retirement of certain existing regulatory systems, specifically the Financial Industry Regulatory Authority, Inc.’s (‘‘FINRA’’) Order Audit Trail System, by adding additional data elements to the CAT reporting requirements for Industry Members,17 additional reporting requirements for alternative trading systems,18 and additional data elements related to OTC Equity Securities 19 that FINRA currently receives from alternative trading systems that trade OTC Equity Securities.20 III. Proceedings To Determine Whether To Approve or Disapprove the Proposed Rule Change The Commission is instituting proceedings pursuant to Section 19(b)(2)(B) of the Act 21 to determine whether the proposed rule change should be approved or disapproved. Institution of proceedings does not indicate that the Commission has reached any conclusions with respect to any of the issues involved. Rather, the Commission seeks and encourages interested persons to provide additional comment on the proposed rule change the Central Repository for the original receipt or origination of an order: (i) The relationship identifier instead of the account number, (ii) the ‘‘account type’’ as a ‘‘relationship’’, and (3) the account effective date instead of the ‘‘date account opened.’’ See Letter to Vanessa Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan Operating Committee Chair, re: Request for Exemption from Certain Provisions of the National Market System Plan Governing the Consolidated Audit Trail related to Granularity of Timestamps and Relationship Identifiers (Feb. 3, 2020). 16 See Notice, supra note 4, at 6611. The Participants requested and have received exemptive relief from the requirement of Section 6.4(d)(ii)(C) of the CAT NMS Plan for the Participants, in their Compliance Rules, to require their members to provide dates of birth, account numbers and social security numbers for individuals to the CAT. See Securities Exchange Act Release No. 88393 (March 17, 2020), 85 FR 16152 (March 20, 2020). See also Letter to Vanessa Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan Operating Committee Chair, re: Request for Exemptive Relief from Certain Provisions of the CAT NMS Plan related to Social Security Numbers, Dates of Birth and Account Numbers (Jan. 29, 2020). 17 See Notice, supra note 4, at 6602–03. 18 See Notice, supra note 4, at 6603–04. 19 OTC Equity Security, as defined in the CAT NMS Plan, means any equity security, other than an NMS Security, subject to prompt last sale reporting rules of a registered national securities association and reported to one of such association’s equity trade reporting facilities. See CAT NMS Plan, supra note 3, at Section 1.1. 20 Id. at 6604–05. 21 15 U.S.C. 78s(b)(2)(B). E:\FR\FM\05MYN1.SGM 05MYN1 26760 Federal Register / Vol. 85, No. 87 / Tuesday, May 5, 2020 / Notices to inform the Commission’s analysis of whether to approve or disapprove the proposed rule change. Pursuant to Section 19(b)(2)(B) of the Act,22 the Commission is providing notice of the grounds for possible disapproval under consideration. The Commission is instituting proceedings to allow for additional analysis of the proposed rule change’s consistency with Section 6(b)(5) of the Act,23 which requires, among other things, that the rules of a national securities exchange be ‘‘designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade,’’ and ‘‘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.’’ 24 The Commission believes that several of the proposed rule changes are not consistent with the CAT NMS Plan or exemptive relief that has been granted as of the date of this Order. IV. Commission’s Solicitation of Comments The Commission requests that interested persons provide written submissions of their views, data, and arguments with respect to the issues identified above, as well as any other concerns they may have with the proposal. In particular, the Commission invites the written views of interested persons concerning whether the proposal is consistent with Section 6(b)(5) 25 or any other provision of the Act, or the rules and regulations thereunder. Although there do not appear to be any issues relevant to approval or disapproval that would be facilitated by an oral presentation of views, data, and arguments, the Commission will consider, pursuant to Rule 19b–4 under the Act,26 any request for an opportunity to make an oral presentation.27 Interested persons are invited to submit written data, views, and arguments regarding whether the proposal should be approved or 22 15 U.S.C. 78s(b)(2)(B). U.S.C. 78f(b)(5). 24 15 U.S.C. 78f(b)(5). 25 15 U.S.C. 78f(b)(5). 26 17 CFR 240.19b–4. 27 Section 19(b)(2) of the Exchange Act, as amended by the Securities Act Amendments of 1975, Public Law 94–29 (June 4, 1975), grants the Commission flexibility to determine what type of proceeding—either oral or notice and opportunity for written comments—is appropriate for consideration of a particular proposal by a selfregulatory organization. See Securities Act Amendments of 1975, Senate Comm. on Banking, Housing & Urban Affairs, S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975). khammond on DSKJM1Z7X2PROD with NOTICES 23 15 VerDate Sep<11>2014 19:16 May 04, 2020 Jkt 250001 disapproved by May 26, 2020. Any person who wishes to file a rebuttal to any other person’s submission must file that rebuttal by June 9, 2020. Comments may be submitted by any of the following methods: For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.28 J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2020–09521 Filed 5–4–20; 8:45 am] BILLING CODE 8011–01–P 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 Numbers SR–CBOE–2020–004 on the subject line. SECURITIES AND EXCHANGE COMMISSION [Investment Company Act Release No. 33859; 812–14774–02] USCF Advisers LLC, et al. Paper Comments April 30, 2020. • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549–1090. AGENCY: All submissions should refer to File Number SR–CBOE–2020–004. 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–CBOE–2020–004 and should be submitted on or before May 26, 2020. Rebuttal comments should be submitted by June 9, 2020. PO 00000 Securities and Exchange Commission (‘‘Commission’’). ACTION: Notice. Notice of an application under section 6(c) of the Investment Company Act of 1940 (‘‘Act’’) for an exemption from section 15(a) of the Act and rule 18f–2 under the Act, as well as from certain disclosure requirements in rule 20a–1 under the Act, Item 19(a)(3) of Form N– 1A, Items 22(c)(1)(ii), 22(c)(1)(iii), 22(c)(8) and 22(c)(9) of Schedule 14A under the Securities Exchange Act of 1934, and Sections 6–07(2)(a), (b), and (c) of Regulation S–X (‘‘Disclosure Requirements’’). The requested exemption would permit an investment adviser to hire and replace certain subadvisers without shareholder approval and grant relief from the Disclosure Requirements as they relate to fees paid to the sub-advisers. APPLICANTS: USCF ETF Trust (the ‘‘Trust’’), a Delaware statutory trust registered under the Act as an open-end management investment company with multiple series; USCF Cayman Commodity 2 (the ‘‘Commodity Strategy Subsidiary’’), a Cayman Islands corporation wholly owned by the USCF SummerHaven Dynamic Commodity Strategy No K–1 Fund (the ‘‘Commodity Strategy Fund’’), a series of the Trust; and USCF Advisers LLC, a Delaware limited liability company registered as an investment adviser under the Investment Advisers Act of 1940 (‘‘USCF Advisers’’ or the ‘‘Advisor,’’ and, collectively with the Trust and the Commodity Strategy Subsidiary, the ‘‘Applicants’’). FILING DATES: The application was filed May 15, 2017, and amended on December 26, 2019, April 2, 2020, and April 30, 2020. HEARING OR NOTIFICATION OF HEARING: An order granting the requested relief will be issued unless the Commission 28 17 Frm 00105 Fmt 4703 Sfmt 4703 E:\FR\FM\05MYN1.SGM CFR 200.30–3(a)(12). 05MYN1

Agencies

[Federal Register Volume 85, Number 87 (Tuesday, May 5, 2020)]
[Notices]
[Pages 26758-26760]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-09521]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-88769; File No. SR-CBOE-2020-004]


Self-Regulatory Organizations; Cboe Exchange, Inc.; Order 
Instituting Proceedings To Determine Whether To Approve or Disapprove a 
Proposed Rule Change To Amend Chapter 7, Section B of the Rules, Which 
Contains the Exchange's Compliance Rule (``Compliance Rule'') Regarding 
the National Market System Plan Governing the Consolidated Audit Trail 
(the ``CAT NMS Plan'' or ``Plan''), To Be Consistent With Certain 
Proposed Amendments to and Exemptions From the CAT NMS Plan as Well as 
To Facilitate the Retirement of Certain Existing Regulatory Systems

April 29, 2020.

I. Introduction

    On January 17, 2020, Cboe Exchange, Inc. (``Cboe Options'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to amend the Exchange's compliance rules regarding 
the National Market System Plan Governing the Consolidated Audit Trail 
(``CAT NMS Plan'').\3\ The proposed rule change was published for 
comment in the Federal Register on February 5, 2020.\4\ On March 20, 
2020, the Commission extended the time period within which to approve 
the proposed rule change, disapprove the proposed rule change, or 
institute proceedings to determine whether to approve or disapprove the 
proposed rule change, to May 5, 2020.\5\

[[Page 26759]]

The Commission received no comments on the proposal. This order 
institutes proceedings pursuant to Exchange Act Section 19(b)(2)(B) to 
determine whether to approve or disapprove File No. SR-CBOE-2020-
004.\6\
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ The CAT NMS Plan was approved by the Commission, as 
modified, on November 15, 2016. See Securities Exchange Act Release 
No. 79318 (November 15, 2016), 81 FR 84696 (November 23, 2016).
    \4\ See Securities Exchange Act Release No. 88105 (January 30, 
2020), 85 FR 6600 (``Notice'').
    \5\ See Securities Exchange Act Release No. 88437, 85 FR 17129 
(March 26, 2020).
    \6\ 15 U.S.C. 78(s)(b)(2)(B).
---------------------------------------------------------------------------

II. Description of the Proposed Rule Change

    The Exchange proposes to amend Chapter 7, Section B of the 
Exchange's rulebook (``Compliance Rule''), which sets forth rules 
regarding Industry Member \7\ compliance with the CAT NMS Plan. 
Specifically, the proposed rule change would make the following changes 
to the Compliance Rule to be consistent with certain proposed 
amendments to and exemption requests submitted by the Participants \8\ 
of the CAT NMS Plan: (1) Revise data reporting requirements for the 
Firm Designated ID \9\ based on a proposed amendment to the CAT NMS 
Plan filed with the Commission; \10\ (2) amend the dates for required 
testing and reporting in the Compliance Rule for Industry Member 
reporting; \11\ (3) amend the rules to require Industry Members to 
submit trade reports for executions and cancellations for cancelled 
trades to the FINRA's Trade Reporting Facilities, FINRA's OTC Reporting 
Facility or FINRA's Alternative Display Facility; \12\ (4) revise the 
timestamp granularity requirement to require Industry Members with 
order handling or execution systems that utilize time stamps in 
increments finer than milliseconds to report timestamps up to 
nanoseconds when reporting Industry Member data \13\ to the Central 
Repository; \14\ (5) revise the reporting requirements for 
circumstances in which an Industry Member uses an established trading 
relationship for an individual Customer, instead of an account, on the 
order reported to CAT; \15\ and (6) revise the CAT reporting 
requirements so Industry Members would not be required to report to the 
Central Repository dates of birth, social security numbers, or account 
numbers for individuals.\16\
---------------------------------------------------------------------------

    \7\ Industry Member means a member of a national securities 
exchange or a member of a national securities association. See CAT 
NMS Plan, supra note 3, at Section 1.1.
    \8\ The Participants include BOX Exchange LLC, Cboe BYX 
Exchange, Inc., Cboe BZX Exchange, Inc., Cboe C2 Exchange, Inc., 
Cboe EDGA Exchange, Inc., Cboe EDGX Exchange, Inc., Cboe Exchange, 
Inc., Financial Industry Regulatory Authority, Inc., Investors' 
Exchange LLC, Long-Term Stock Exchange, Inc., Miami International 
Securities Exchange LLC, MIAX Emerald, LLC, MIAX PEARL, LLC, Nasdaq 
BX, Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC, Nasdaq 
PHLX LLC, The Nasdaq Stock Market LLC, New York Stock Exchange LLC, 
NYSE American LLC, NYSE Arca, Inc., NYSE Chicago, Inc., and NYSE 
National, Inc.
    \9\ As proposed, ``Firm Designated ID'' would mean a unique and 
persistent identifier for each trading account designated by 
Industry Members for purposes of providing data to the Central 
Repository, where each such identifier is unique among all 
identifiers from any given Industry Member; provided, however, such 
identifier may not be the account number for such trading account if 
the trading account is not a proprietary account. See proposed CBOE 
Rule 7.20(r).
    \10\ See Notice, supra note 4, at 6601-02. See also Letter to 
Vanessa Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan 
Operating Committee Chair re: Notice of Filing of Amendment to the 
National Market System Plan Governing the Consolidated Audit Trail 
(April 14, 2020). The Commission has not approved or disapproved the 
changes proposed in this amendment.
    \11\ See Notice, supra note 4, at 6605-09. On February 19, 2020, 
the Participants submitted a request for exemptive relief from the 
reporting dates required by the CAT NMS Plan. See Letter to Vanessa 
Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan 
Operating Committee Chair, re: Request for Exemption from Provisions 
of the National Market System Plan Governing the Consolidated Audit 
Trail related to Industry Member Reporting Dates (Feb. 19, 2020). On 
April 20, 2020, the Commission granted limited exemptive relief to 
allow for the implementation of phased reporting for Industry 
Members. See Securities Exchange Act Release No. 88702 (April 20, 
2020), 85 FR 23075 (April 24, 2020).
    \12\ See Notice, supra note 4, at 6609-10. On February 12, 2020, 
the Participants submitted a request for exemptive relief from the 
requirement in Sections 6.4(d)(ii)(A)(2) and (B) of the CAT NMS Plan 
to require Industry Members to record and report, if an order is 
executed, the SRO-Assigned Market Participant Identifier of the 
clearing broker, and if a trade is cancelled, the cancelled trade 
indicator. See Letter to Vanessa Countryman, Secretary, SEC, from 
Michael Simon, CAT NMS Plan Operating Committee Chair, re: Request 
for Exemption from Certain Provisions of the National Market System 
Plan Governing the Consolidated Audit Trail related to FINRA 
Facility Data Linkage (Feb. 12, 2020). If granted, the exemptive 
relief would revise CAT reporting requirements regarding cancelled 
trades and SRO-Assigned Market Participant Identifiers of clearing 
brokers, if applicable, in connection with order executions, as such 
information would be available from FINRA's trade reports submitted 
to CAT.
    \13\ See Notice, supra note 4, at 6610. On February 3, 2020, the 
Participants filed a request for exemptive relief from the current 
CAT NMS Plan requirement to record and report Industry Member Data 
with time stamps consistent with their system, a requirement from 
which the Exchange requests an exemption. See Letter to Vanessa 
Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan 
Operating Committee Chair, re: Request for Exemption from Certain 
Provisions of the National Market System Plan Governing the 
Consolidated Audit Trail related to Granularity of Timestamps and 
Relationship Identifiers (Feb. 3, 2020). On April 8, 2020, the 
Commission granted the exemptive relief for timestamp granularity. 
See Securities Exchange Act Release No. 88608 (April 8, 2020), 85 FR 
20743 (April 14, 2020).
    \14\ The Central Repository, as defined in the CAT NMS Plan, 
means ``the repository responsible for the receipt, consolidation, 
and retention of all information reported to the CAT pursuant to SEC 
Rule 613 and this Agreement.'' See CAT NMS Plan, supra note 3, at 
Section 1.1.
    \15\ See Notice, supra note 4, at 6610-11. On February 3, 2020, 
the Participants filed a request for exemptive relief from the CAT 
NMS Plan requirement that Participants, through their Compliance 
Rules, require Industry Members to record and report to the Central 
Repository the account number, the date account opened, and the 
account type for individual customers in circumstances in which an 
Industry Member uses an established trading relationship for the 
individual customer. Instead, the Participant would require Industry 
Members to record and report to the Central Repository for the 
original receipt or origination of an order: (i) The relationship 
identifier instead of the account number, (ii) the ``account type'' 
as a ``relationship'', and (3) the account effective date instead of 
the ``date account opened.'' See Letter to Vanessa Countryman, 
Secretary, SEC, from Michael Simon, CAT NMS Plan Operating Committee 
Chair, re: Request for Exemption from Certain Provisions of the 
National Market System Plan Governing the Consolidated Audit Trail 
related to Granularity of Timestamps and Relationship Identifiers 
(Feb. 3, 2020).
    \16\ See Notice, supra note 4, at 6611. The Participants 
requested and have received exemptive relief from the requirement of 
Section 6.4(d)(ii)(C) of the CAT NMS Plan for the Participants, in 
their Compliance Rules, to require their members to provide dates of 
birth, account numbers and social security numbers for individuals 
to the CAT. See Securities Exchange Act Release No. 88393 (March 17, 
2020), 85 FR 16152 (March 20, 2020). See also Letter to Vanessa 
Countryman, Secretary, SEC, from Michael Simon, CAT NMS Plan 
Operating Committee Chair, re: Request for Exemptive Relief from 
Certain Provisions of the CAT NMS Plan related to Social Security 
Numbers, Dates of Birth and Account Numbers (Jan. 29, 2020).
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    The Exchange also proposes to amend the Exchange's Compliance Rule 
to facilitate the retirement of certain existing regulatory systems, 
specifically the Financial Industry Regulatory Authority, Inc.'s 
(``FINRA'') Order Audit Trail System, by adding additional data 
elements to the CAT reporting requirements for Industry Members,\17\ 
additional reporting requirements for alternative trading systems,\18\ 
and additional data elements related to OTC Equity Securities \19\ that 
FINRA currently receives from alternative trading systems that trade 
OTC Equity Securities.\20\
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    \17\ See Notice, supra note 4, at 6602-03.
    \18\ See Notice, supra note 4, at 6603-04.
    \19\ OTC Equity Security, as defined in the CAT NMS Plan, means 
any equity security, other than an NMS Security, subject to prompt 
last sale reporting rules of a registered national securities 
association and reported to one of such association's equity trade 
reporting facilities. See CAT NMS Plan, supra note 3, at Section 
1.1.
    \20\ Id. at 6604-05.
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III. Proceedings To Determine Whether To Approve or Disapprove the 
Proposed Rule Change

    The Commission is instituting proceedings pursuant to Section 
19(b)(2)(B) of the Act \21\ to determine whether the proposed rule 
change should be approved or disapproved. Institution of proceedings 
does not indicate that the Commission has reached any conclusions with 
respect to any of the issues involved. Rather, the Commission seeks and 
encourages interested persons to provide additional comment on the 
proposed rule change

[[Page 26760]]

to inform the Commission's analysis of whether to approve or disapprove 
the proposed rule change.
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    \21\ 15 U.S.C. 78s(b)(2)(B).
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    Pursuant to Section 19(b)(2)(B) of the Act,\22\ the Commission is 
providing notice of the grounds for possible disapproval under 
consideration. The Commission is instituting proceedings to allow for 
additional analysis of the proposed rule change's consistency with 
Section 6(b)(5) of the Act,\23\ which requires, among other things, 
that the rules of a national securities exchange be ``designed to 
prevent fraudulent and manipulative acts and practices, to promote just 
and equitable principles of trade,'' and ``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.'' \24\ The Commission believes that several of the proposed 
rule changes are not consistent with the CAT NMS Plan or exemptive 
relief that has been granted as of the date of this Order.
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    \22\ 15 U.S.C. 78s(b)(2)(B).
    \23\ 15 U.S.C. 78f(b)(5).
    \24\ 15 U.S.C. 78f(b)(5).
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IV. Commission's Solicitation of Comments

    The Commission requests that interested persons provide written 
submissions of their views, data, and arguments with respect to the 
issues identified above, as well as any other concerns they may have 
with the proposal. In particular, the Commission invites the written 
views of interested persons concerning whether the proposal is 
consistent with Section 6(b)(5) \25\ or any other provision of the Act, 
or the rules and regulations thereunder. Although there do not appear 
to be any issues relevant to approval or disapproval that would be 
facilitated by an oral presentation of views, data, and arguments, the 
Commission will consider, pursuant to Rule 19b-4 under the Act,\26\ any 
request for an opportunity to make an oral presentation.\27\
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    \25\ 15 U.S.C. 78f(b)(5).
    \26\ 17 CFR 240.19b-4.
    \27\ Section 19(b)(2) of the Exchange Act, as amended by the 
Securities Act Amendments of 1975, Public Law 94-29 (June 4, 1975), 
grants the Commission flexibility to determine what type of 
proceeding--either oral or notice and opportunity for written 
comments--is appropriate for consideration of a particular proposal 
by a self-regulatory organization. See Securities Act Amendments of 
1975, Senate Comm. on Banking, Housing & Urban Affairs, S. Rep. No. 
75, 94th Cong., 1st Sess. 30 (1975).
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    Interested persons are invited to submit written data, views, and 
arguments regarding whether the proposal should be approved or 
disapproved by May 26, 2020. Any person who wishes to file a rebuttal 
to any other person's submission must file that rebuttal by June 9, 
2020. 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 Numbers SR-CBOE-2020-004 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-CBOE-2020-004. 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-CBOE-2020-004 and should be submitted on 
or before May 26, 2020. Rebuttal comments should be submitted by June 
9, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\28\
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    \28\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-09521 Filed 5-4-20; 8:45 am]
 BILLING CODE 8011-01-P
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