Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Section II of the Fee Schedule (Manual Transaction Fees) on the BOX Options Market LLC Facility, 36647-36649 [2020-12983]

Download as PDF Federal Register / Vol. 85, No. 117 / Wednesday, June 17, 2020 / Notices Exchange had less than 10% market share of executed volume of multiplylisted equity & ETF options trades.19 The Exchange believes that the proposed Rebate change reflects this competitive environment because it modifies the Exchange’s fees in a manner designed to incent Floor Brokers to direct trading interest to the Exchange, to provide liquidity and to attract order flow. To the extent that this purpose is achieved, all the Exchange’s market participants should benefit from the improved market quality and increased opportunities for price improvement. The Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues. In such an environment, the Exchange must continually review, and consider adjusting, its fees and credits to remain competitive with other exchanges. For the reasons described above, the Exchange believes that the proposed rule change reflects this competitive environment. And, in fact, the Exchange believes that the proposed change could promote competition between the Exchange and other execution venues, by encouraging additional orders to be sent to the Exchange for execution, including to the Floor. khammond on DSKJM1Z7X2PROD with NOTICES C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change is effective upon filing pursuant to Section 19(b)(3)(A) 20 of the Act and subparagraph (f)(2) of Rule 19b–4 21 thereunder, because it establishes a due, fee, or other charge imposed by the Exchange. At any time within 60 days of the filing of such 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 19 Based on OCC data, supra note 7, the Exchange’s market share in equity-based options was 9.82% for the month of January 2019 and 8.08% for the month of January 2020. 20 15 U.S.C. 78s(b)(3)(A). 21 17 CFR 240.19b–4(f)(2). VerDate Sep<11>2014 16:44 Jun 16, 2020 Jkt 250001 Commission shall institute proceedings under Section 19(b)(2)(B) 22 of the Act 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– NYSEAMER–2020–45 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–NYSEAMER–2020–45. 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 22 15 PO 00000 U.S.C. 78s(b)(2)(B). Frm 00121 Fmt 4703 Sfmt 4703 36647 Number SR–NYSEAMER–2020–45, and should be submitted on or before July 8, 2020. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.23 J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2020–12984 Filed 6–16–20; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–89043; File No. SR–BOX– 2020–18] Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Section II of the Fee Schedule (Manual Transaction Fees) on the BOX Options Market LLC Facility June 11, 2020. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on June 1, 2020, BOX Exchange LLC (‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘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 proposed rule change pursuant to Section 19(b)(3)(A)(ii) of the Act,3 and Rule 19b–4(f)(2) thereunder,4 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of the Substance of the Proposed Rule Change The Exchange is filing with the Securities and Exchange Commission (‘‘Commission’’) a proposed rule change to amend the Fee Schedule to the BOX Options Market LLC (‘‘BOX’’) facility. The text of the proposed rule change is available from the principal office of the Exchange, at the Commission’s Public Reference Room and also on the Exchange’s internet website at https:// boxexchange.com. 23 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)(ii). 4 17 CFR 240.19b–4(f)(2). 1 15 E:\FR\FM\17JNN1.SGM 17JNN1 36648 Federal Register / Vol. 85, No. 117 / Wednesday, June 17, 2020 / Notices 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 Exchange proposes to amend the Fee Schedule for trading on BOX to amend Section II (Manual Transaction Fees).5 The Exchange first proposes to amend QOO Order Fees for Professional Customers in Section II.A of the BOX Fee Schedule. Specifically, the Exchange proposes to decrease the Professional Customer QOO Order Fee in Penny Pilot Classes and Non-Penny Pilot Classes from $0.25 per contract to $0.10 per contract. Next, the Exchange proposes to amend Section II.C of the BOX Fee Schedule. Specifically, the Exchange proposes to reduce the QOO Order Rebate for all Professional Customer QOO Orders to $0.05.6 khammond on DSKJM1Z7X2PROD with NOTICES 2. Statutory Basis The Exchange believes that the proposal is consistent with the requirements of Section 6(b) of the Act, in general, and Section 6(b)(4) and 6(b)(5) of the Act,7 in particular, in that it provides for the equitable allocation of reasonable dues, fees, and other charges among BOX Participants and other persons using its facilities and does not unfairly discriminate between customers, issuers, brokers or dealers. The Exchange notes that it operates in a highly competitive market in which the Exchange must continually reassess its fees in order to maintain its competitiveness within the options exchange industry. The proposed rule 5 Orders initiated and presented on the Trading Floor in open outcry, as opposed to initiated electronically. Manual transactions consist of Qualified Open Outcry (‘‘QOO’’) Orders. All fees, rebates and applicable caps will apply to both sides of the paired QOO Order. 6 Currently, Floor Brokers receive a $0.075 per contract rebate for Professional Customer QOO Orders presented on the Trading Floor. 7 15 U.S.C. 78f(b)(4) and (5). VerDate Sep<11>2014 16:44 Jun 16, 2020 Jkt 250001 changes reflect a competitive pricing structure designed to incentivize market participants to direct their order flow to the Exchange. The Exchange believes the proposed change to reduce Professional Customer QOO Order fees is reasonable, equitable, and not unfairly discriminatory because it is intended to attract a greater number of Professional Customer QOO orders to the Exchange. The Exchange believes the potential increased volume would create better trading opportunities that benefit all market participants. Specifically, greater volume and liquidity from increased order flow could create more trading opportunities and tighter spreads. Further, the Exchange believes it is equitable and not unfairly discriminatory to assess Professional Customers lower fees for manual transactions than Broker Dealers and Market Makers because, by definition, Professional Customers are a different type of market participant. Specifically, Professional Customers are not brokers or dealers in securities; they are persons (or entities) that place more than 390 orders per day on average for their own beneficial account. The Exchange notes that assessing lower fees for Professional Customers compared to Broker Dealers and Market Makers is not novel as BOX currently assesses lower fees for Professional Customers than Broker Dealers and Market Makers in another part of its Fee Schedule.8 Further, the Exchange notes that Cboe Exchange Inc. (‘‘Cboe’’) currently assesses different fees for Professional Customers compared to Broker-Dealers and Market Makers for floor transactions.9 In addition, the Exchange believes the proposed $0.10 fee is reasonable when compared to fees assessed for similar transactions for Professional Customers at another exchange.10 Further, the Exchange believes that the proposed change is equitable and not unfairly discriminatory, as the proposed change applies to all Professional Customer QOO Orders presented on the Trading Floor by Floor Brokers. The Exchange believes the proposal to reduce the QOO Order Rebate for all Professional Customer QOO 8 See BOX Fee Schedule Section I.D. Qualified Contingent Cross (‘‘QCC’’) Transactions. The Exchange notes that Professional Customers are charged no fee for QCC transactions where Broker Dealers and Market Makers are charged $0.17 for their QCC transactions. 9 For manual transactions, Cboe charges $0.12 per contract for professional customers (‘‘U’’ capacity code); $0.25 per contract for Broker-Dealers (‘‘BA’’ code); and $0.23 for Market-Makers (‘‘MA’’ code). See Cboe Fees Schedule ‘‘Options Transaction Fee Per Contract; Manual’’. 10 Id. PO 00000 Frm 00122 Fmt 4703 Sfmt 4703 transactions is reasonable. Specifically, the Exchange believes the proposed $0.05 rebate is balanced by the potential increase in Professional Customer volume directed toward the Exchange’s Floor Brokers who would benefit from a rise in rebate opportunities because of the increased volume from Professional Customer orders. The Exchange believes that the rebate will continue to incentivize Floor Brokers to execute Professional Customer QOO Orders on the Trading Floor. The Exchange also notes that Floor Brokers will continue to receive a $0.075 per contract rebate on all other qualifying QOO Orders presented to the Trading Floor. Lastly, the Exchange believes that the proposal to lower the QOO Order Rebate for Professional Customer executions is equitable and not unfairly discriminatory because the proposed change applies to all Professional Customers’ QOO Orders presented to the Trading Floor equally. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The Exchange notes that is operates in a highly competitive market in which competitors are free to modify their own fee schedules. The Exchange believes that the proposal to reduce the QOO Order fee for Professional Customers does not impose a burden on competition. Although the reduction in QOO Order Fees to $0.10 for manual executions only applies to Professional Customers, the proposed change is aimed at encouraging increased Professional Customer options volume, which may provide greater trading opportunities for all market participants. The Exchange believes this enhances competition as it is intended to increase the competitiveness of BOX by adopting an additional pricing incentive in order to attract order flow and incentivize Professional Customer executions on the Exchange. Further, the Exchange does not believe that reducing the QOO Order rebate for Professional Customer executions will impose an undue burden on intermarket competition. Several other competing exchanges have open outcry trading floors and market participants can readily direct order flow to any these venues if they deem BOX’s manual transaction fees to be excessive, or rebate opportunities available at other venues to be more favorable. In such an environment, the Exchange must continually adjust its E:\FR\FM\17JNN1.SGM 17JNN1 Federal Register / Vol. 85, No. 117 / Wednesday, June 17, 2020 / Notices fees to remain competitive with other exchanges. The Exchange does not believe the proposed rule change to reduce the QOO Order rebate for Professional Customer executions would burden intramarket competition as it would apply uniformly to all Floor Brokers on the BOX Trading Floor. The proposed rule change reflects a competitive pricing structure designed to incentivize Professional Customers to direct their order flow to the Exchange, which the Exchange believes would enhance market quality to the benefit of all Participants. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. 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)(ii) of the Exchange Act 11 and Rule 19b–4(f)(2) thereunder,12 because it establishes or changes a due, or fee. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend the rule change if it appears to the Commission that the action is necessary or appropriate in the public interest, for the protection of investors, or would otherwise further the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: khammond on DSKJM1Z7X2PROD with 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– BOX–2020–18 on the subject line. Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange 11 15 12 17 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). VerDate Sep<11>2014 16:44 Jun 16, 2020 Commission, 100 F Street NE, Washington, DC 20549–1090. All submissions should refer to File Number SR–BOX–2020–18. 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 such 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–BOX–2020–18, and should be submitted on or before July 8, 2020. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13 J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2020–12983 Filed 6–16–20; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–89049; File No. SR– NYSEAMER–2020–44] Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Modifying the NYSE American Options Fee Schedule June 11, 2020. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (the 13 17 1 15 Jkt 250001 PO 00000 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). Frm 00123 Fmt 4703 Sfmt 4703 36649 ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on June 5, 2020, NYSE American LLC (‘‘NYSE American’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the selfregulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to modify the NYSE American Options Fee Schedule (‘‘Fee Schedule’’) to extend through June 2020 certain fee changes implemented for April and May 2020. The Exchange proposes to implement the fee change effective June 5, 2020.4 The proposed change is available on the Exchange’s website at www.nyse.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to modify the Fee Schedule to extend through June 2020 certain fee changes implemented for April and May 2020, as described below. The Exchange proposes to implement the fee change effective May 28, 2020. On March 18, 2020, the Exchange announced that it would temporarily close the Trading Floor, effective Monday, March 23, 2020, as a 2 15 U.S.C. 78a. CFR 240.19b–4. 4 The Exchange originally filed to amend the Fee Schedule on May 28, 2020 (SR–NYSEAMER–2020– 42) and withdrew such filing on June 5, 2020. 3 17 E:\FR\FM\17JNN1.SGM 17JNN1

Agencies

[Federal Register Volume 85, Number 117 (Wednesday, June 17, 2020)]
[Notices]
[Pages 36647-36649]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-12983]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-89043; File No. SR-BOX-2020-18]


Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend Section 
II of the Fee Schedule (Manual Transaction Fees) on the BOX Options 
Market LLC Facility

June 11, 2020.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on June 1, 2020, BOX Exchange LLC (``Exchange'') filed with the 
Securities and Exchange Commission (``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 proposed rule 
change pursuant to Section 19(b)(3)(A)(ii) of the Act,\3\ and Rule 19b-
4(f)(2) thereunder,\4\ which renders the proposal effective upon filing 
with the Commission. 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)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    The Exchange is filing with the Securities and Exchange Commission 
(``Commission'') a proposed rule change to amend the Fee Schedule to 
the BOX Options Market LLC (``BOX'') facility. The text of the proposed 
rule change is available from the principal office of the Exchange, at 
the Commission's Public Reference Room and also on the Exchange's 
internet website at https://boxexchange.com.

[[Page 36648]]

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 Exchange proposes to amend the Fee Schedule for trading on BOX 
to amend Section II (Manual Transaction Fees).\5\
---------------------------------------------------------------------------

    \5\ Orders initiated and presented on the Trading Floor in open 
outcry, as opposed to initiated electronically. Manual transactions 
consist of Qualified Open Outcry (``QOO'') Orders. All fees, rebates 
and applicable caps will apply to both sides of the paired QOO 
Order.
---------------------------------------------------------------------------

    The Exchange first proposes to amend QOO Order Fees for 
Professional Customers in Section II.A of the BOX Fee Schedule. 
Specifically, the Exchange proposes to decrease the Professional 
Customer QOO Order Fee in Penny Pilot Classes and Non-Penny Pilot 
Classes from $0.25 per contract to $0.10 per contract. Next, the 
Exchange proposes to amend Section II.C of the BOX Fee Schedule. 
Specifically, the Exchange proposes to reduce the QOO Order Rebate for 
all Professional Customer QOO Orders to $0.05.\6\
---------------------------------------------------------------------------

    \6\ Currently, Floor Brokers receive a $0.075 per contract 
rebate for Professional Customer QOO Orders presented on the Trading 
Floor.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act, in general, and Section 
6(b)(4) and 6(b)(5) of the Act,\7\ in particular, in that it provides 
for the equitable allocation of reasonable dues, fees, and other 
charges among BOX Participants and other persons using its facilities 
and does not unfairly discriminate between customers, issuers, brokers 
or dealers. The Exchange notes that it operates in a highly competitive 
market in which the Exchange must continually reassess its fees in 
order to maintain its competitiveness within the options exchange 
industry. The proposed rule changes reflect a competitive pricing 
structure designed to incentivize market participants to direct their 
order flow to the Exchange.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    The Exchange believes the proposed change to reduce Professional 
Customer QOO Order fees is reasonable, equitable, and not unfairly 
discriminatory because it is intended to attract a greater number of 
Professional Customer QOO orders to the Exchange. The Exchange believes 
the potential increased volume would create better trading 
opportunities that benefit all market participants. Specifically, 
greater volume and liquidity from increased order flow could create 
more trading opportunities and tighter spreads. Further, the Exchange 
believes it is equitable and not unfairly discriminatory to assess 
Professional Customers lower fees for manual transactions than Broker 
Dealers and Market Makers because, by definition, Professional 
Customers are a different type of market participant. Specifically, 
Professional Customers are not brokers or dealers in securities; they 
are persons (or entities) that place more than 390 orders per day on 
average for their own beneficial account. The Exchange notes that 
assessing lower fees for Professional Customers compared to Broker 
Dealers and Market Makers is not novel as BOX currently assesses lower 
fees for Professional Customers than Broker Dealers and Market Makers 
in another part of its Fee Schedule.\8\ Further, the Exchange notes 
that Cboe Exchange Inc. (``Cboe'') currently assesses different fees 
for Professional Customers compared to Broker-Dealers and Market Makers 
for floor transactions.\9\ In addition, the Exchange believes the 
proposed $0.10 fee is reasonable when compared to fees assessed for 
similar transactions for Professional Customers at another 
exchange.\10\ Further, the Exchange believes that the proposed change 
is equitable and not unfairly discriminatory, as the proposed change 
applies to all Professional Customer QOO Orders presented on the 
Trading Floor by Floor Brokers.
---------------------------------------------------------------------------

    \8\ See BOX Fee Schedule Section I.D. Qualified Contingent Cross 
(``QCC'') Transactions. The Exchange notes that Professional 
Customers are charged no fee for QCC transactions where Broker 
Dealers and Market Makers are charged $0.17 for their QCC 
transactions.
    \9\ For manual transactions, Cboe charges $0.12 per contract for 
professional customers (``U'' capacity code); $0.25 per contract for 
Broker-Dealers (``BA'' code); and $0.23 for Market-Makers (``MA'' 
code). See Cboe Fees Schedule ``Options Transaction Fee Per 
Contract; Manual''.
    \10\ Id.
---------------------------------------------------------------------------

    The Exchange believes the proposal to reduce the QOO Order Rebate 
for all Professional Customer QOO transactions is reasonable. 
Specifically, the Exchange believes the proposed $0.05 rebate is 
balanced by the potential increase in Professional Customer volume 
directed toward the Exchange's Floor Brokers who would benefit from a 
rise in rebate opportunities because of the increased volume from 
Professional Customer orders. The Exchange believes that the rebate 
will continue to incentivize Floor Brokers to execute Professional 
Customer QOO Orders on the Trading Floor. The Exchange also notes that 
Floor Brokers will continue to receive a $0.075 per contract rebate on 
all other qualifying QOO Orders presented to the Trading Floor. Lastly, 
the Exchange believes that the proposal to lower the QOO Order Rebate 
for Professional Customer executions is equitable and not unfairly 
discriminatory because the proposed change applies to all Professional 
Customers' QOO Orders presented to the Trading Floor equally.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange notes that is 
operates in a highly competitive market in which competitors are free 
to modify their own fee schedules. The Exchange believes that the 
proposal to reduce the QOO Order fee for Professional Customers does 
not impose a burden on competition. Although the reduction in QOO Order 
Fees to $0.10 for manual executions only applies to Professional 
Customers, the proposed change is aimed at encouraging increased 
Professional Customer options volume, which may provide greater trading 
opportunities for all market participants. The Exchange believes this 
enhances competition as it is intended to increase the competitiveness 
of BOX by adopting an additional pricing incentive in order to attract 
order flow and incentivize Professional Customer executions on the 
Exchange.
    Further, the Exchange does not believe that reducing the QOO Order 
rebate for Professional Customer executions will impose an undue burden 
on intermarket competition. Several other competing exchanges have open 
outcry trading floors and market participants can readily direct order 
flow to any these venues if they deem BOX's manual transaction fees to 
be excessive, or rebate opportunities available at other venues to be 
more favorable. In such an environment, the Exchange must continually 
adjust its

[[Page 36649]]

fees to remain competitive with other exchanges. The Exchange does not 
believe the proposed rule change to reduce the QOO Order rebate for 
Professional Customer executions would burden intramarket competition 
as it would apply uniformly to all Floor Brokers on the BOX Trading 
Floor. The proposed rule change reflects a competitive pricing 
structure designed to incentivize Professional Customers to direct 
their order flow to the Exchange, which the Exchange believes would 
enhance market quality to the benefit of all Participants.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or received.

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)(ii) of the Exchange Act \11\ and Rule 19b-4(f)(2) 
thereunder,\12\ because it establishes or changes a due, or fee.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \12\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend the rule 
change if it appears to the Commission that the action is necessary or 
appropriate in the public interest, for the protection of investors, or 
would otherwise further the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-BOX-2020-18 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-BOX-2020-18. 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 such 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-BOX-2020-18, and should be submitted on 
or before July 8, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-12983 Filed 6-16-20; 8:45 am]
BILLING CODE 8011-01-P
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