Self-Regulatory Organizations; MEMX LLC; Notice of Filing of Proposed Minor Rule Violation Plan, 48577-48579 [2020-17453]
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Federal Register / Vol. 85, No. 155 / Tuesday, August 11, 2020 / Notices
potential financial impact during the
partial reopening of the Floor.
Intermarket Competition. The
Exchange operates in a highly
competitive market in which market
participants can readily favor one of the
16 competing option exchanges if they
deem fee levels at a particular venue to
be excessive. In such an environment,
the Exchange must continually adjust its
fees to remain competitive with other
exchanges and to attract order flow to
the Exchange. Based on publiclyavailable information, and excluding
index-based options, no single exchange
currently has more than 16% of the
market share of executed volume of
multiply-listed equity and ETF options
trades.14 Therefore, currently no
exchange possesses significant pricing
power in the execution of multiplylisted equity & ETF options order flow.
More specifically, in June 2020, the
Exchange had less than 10% market
share of executed volume of multiplylisted equity & ETF options trades.15
The Exchange believes that the
proposed rule change reflects this
competitive environment because it
waives fees for Qualifying Firms and is
designed to reduce monthly costs for
Floor participants whose operations
continue to be disrupted despite the fact
that the Trading Floor has partially
reopened. In reducing this monthly
financial burden, the proposed change
would allow affected participants to
reallocate funds to assist with the cost
of shifting and maintaining their prior
fully-staffed on-Floor operations to offFloor. Absent this change, Qualifying
Firms may experience an unintended
increase in the cost of doing business on
the Exchange, which would make the
Exchange a less competitive venue on
which to trade as compared to other
options exchanges.
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) 16 of the Act and
14 See
supra note 11.
on OCC data, supra note 12, the
Exchange’s market share in equity-based options
was 8.20% for the month of June 2019 and 8.32%
for the month of June 2020.
16 15 U.S.C. 78s(b)(3)(A).
15 Based
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subparagraph (f)(2) of Rule 19b–4 17
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
Commission shall institute proceedings
under Section 19(b)(2)(B) 18 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–2020–58 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–2020–58. 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
17 17
18 15
PO 00000
CFR 240.19b–4(f)(2).
U.S.C. 78s(b)(2)(B).
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48577
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–NYSEAMER–2020–58, and
should be submitted on or before
September 1, 2020.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.19
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–17456 Filed 8–10–20; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–89485; File No. 4–764]
Self-Regulatory Organizations; MEMX
LLC; Notice of Filing of Proposed
Minor Rule Violation Plan
August 5, 2020.
Pursuant to Section 19(d)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19d–l(c)(2)
thereunder,2 notice is hereby given that
on August 5, 2020, MEMX LLC
(‘‘MEMX’’ or the ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) a
proposed minor rule violation plan
(‘‘MRVP’’) with sanctions not exceeding
$2,500 which would not be subject to
the provisions of Rule 19d–1(c)(1) of the
Act 3 requiring that a self-regulatory
organization (‘‘SRO’’) promptly file
notice with the Commission of any final
disciplinary action taken with respect to
any person or organization.4 In
19 17
CFR 200.30–3(a)(12).
U.S.C. 78s(d)(1).
2 17 CFR 240.19d–1(c)(2).
3 17 CFR 240.19d–1(c)(1).
4 The Commission adopted amendments to
paragraph (c) of Rule 19d–l to allow SROs to submit
for Commission approval plans for the abbreviated
reporting of minor disciplinary infractions. See
Securities Exchange Act Release No. 21013 (June 1,
1984), 49 FR 23828 (June 8, 1984). Any disciplinary
action taken by an SRO against any person for
violation of a rule of the SRO which has been
designated as a minor rule violation pursuant to
such a plan filed with and declared effective by the
Commission is not considered ‘‘final’’ for purposes
of Section 19(d)(1) of the Act if the sanction
1 15
Continued
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48578
Federal Register / Vol. 85, No. 155 / Tuesday, August 11, 2020 / Notices
accordance with Rule 19d–l(c)(2) under
the Act, the Exchange proposes to
designate certain specified rule
violations as minor rule violations and
requests that it be relieved of the prompt
reporting requirements regarding such
violations, provided it gives notice of
such violations to the Commission on a
quarterly basis.
The Exchange proposes to include in
its MRVP the procedures included in
Exchange Rule 8.15 (‘‘Imposition of
Fines for Minor Violation(s) of Rules’’)
and the violations included in Rule
8.15.01 (‘‘List of Exchange Rule
Violations and Recommended Fine
Schedule Pursuant to Rule 8.15’’).5
According to the Exchange’s MRVP,
under Rule 8.15(a), the Exchange may
impose a fine (not to exceed $2,500) on
any Member, associated person of a
Member, or registered or non-registered
employee of a Member, for any violation
of a Rule of the Exchange which
violation the Exchange shall have
determined is minor in nature, as set
forth in Rule 8.15.01. The Exchange may
aggregate similar violations generally if
the conduct was unintentional, there
was no injury to public investors, or the
violations resulted from a single
systemic problem or cause that has been
corrected. In any action taken by the
Exchange pursuant to Rule 8.15, the
person against whom a fine is imposed
shall be served with a written statement,
signed by an authorized officer of the
Exchange, setting forth (i) the Rule or
Rules alleged to have been violated; (ii)
the act or omission constituting each
such violation; (iii) the fine imposed for
each such violation; and (iv) the date by
which such determination becomes
final and such fine becomes due and
payable to the Exchange. Pursuant to
paragraph (c) of Rule 8.15, if the person
against whom a fine is imposed
pursuant to Rule 8.15 pays such fine,
that payment shall be deemed to be a
waiver by of such person’s right to a
disciplinary proceeding under Rules 8.1
through 8.13 and any review of the
imposed consists of a fine not exceeding $2,500 and
the sanctioned person has not sought an
adjudication, including a hearing, or otherwise
exhausted his administrative remedies.
5 The Exchange received its grant of registration
on May 4, 2020, which included approving the
rules that govern the Exchange. Exhibit A includes
the entirety of Rules 8.15 and 8.15.01. Terms not
otherwise defined herein are defined in the
Exchange Rules. Contemporaneous with this filing,
the Exchange filed with the Commission a rule
filing that proposes a minor amendment to Rule
8.15(a) and a proposed change to Rule 8.15.01 to
add Rules 4.5 through 4.16 (Consolidated Audit
Trail Compliance Rules). This submission proposes
the Exchange’s MRVP, including those proposed
changes to Rules 8.15 and 8.15.01. See SR–MEMX–
2020–03, filed July 31, 2020, available at: https://
info.memxtrading.com/category/rule-filings/.
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17:02 Aug 10, 2020
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matter by the Appeals Committee or by
the Board. Any person against whom a
fine is imposed pursuant to Rule 8.15
may contest such a finding pursuant to
paragraph (d) of Rule 8.15 by filing with
the Exchange not later than the date by
which such determination must be
contested (such date to be not less than
15 business days after the date of service
of the written statement by the
Exchange) a written response meeting
the requirements provided in Rule 8.5 at
which point the matter shall become a
disciplinary proceeding subject to the
provisions of Rules 8.1 through 8.13.
The Exchange proposes that, as set
forth in Exchange Rule 8.15.01,
violations of the following rules would
be appropriate for disposition under the
MRVP: Rule 4.2 and Interpretations
thereunder (requiring the submission of
responses to Exchange requests for
trading data within specified time
period); Rule 11.10(a)(5) (requirement to
identify short sale orders as such); Rule
11.10(f) (requirement to comply with
locked and crossed market rules); Rule
3.5 (Advertising Practices); Rule 12.11
Interpretations and Policy .01 and
Exchange Act Rule 604 (failure to
properly display limit orders); Rule 4.2
and Interpretations thereunder (related
to the requirement to furnish Exchangerelated order, market and transaction
data, as well as financial or regulatory
records and information); Rule
11.20(a)(1) (requirement for Market
Makers to maintain continuous twosided quotations); and Rules 4.5 through
4.16 (Consolidated Audit Trail
Compliance Rules).
Upon the Commission’s declaration of
effectiveness of the MRVP, the Exchange
will provide to the Commission a
quarterly report for any actions taken on
minor rule violations under the MRVP.
The quarterly report will include: The
Exchange’s internal file number for the
case, the name of the individual and/or
organization, the nature of the violation,
the specific rule provision violated, the
fine imposed, the number of times the
rule violation occurred, and the date of
the disposition.
Based on compliance with the above,
the Exchange requests that the rule
violations designated in Exchange Rule
8.15.01 be designated as minor rule
violations subject to a minor rule
violation reporting plan and that the
Exchange be relieved of the current
reporting requirements regarding such
violations. In addition, going forward, to
the extent that there are any changes to
the rules applicable to the Exchange’s
MRVP, the Exchange requests that the
Commission deem such changes to be
modifications to the Exchange’s MRVP.
PO 00000
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I. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the Exchange’s
proposed MRVP, including whether the
proposed MRVP 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 4–
764 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 4–764. 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
MRVP that are filed with the
Commission, and all written
communications relating to the
proposed MRVP 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
proposed MRVP 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 4–764, and should be
submitted on or before August 26, 2020.
II. Date of Effectiveness of the Proposed
Minor Rule Violation Plan and Timing
for Commission Action
Pursuant to Section 19(d)(l) of the Act
and Rule 19d–l(c)(2) thereunder,6 after
6 15
E:\FR\FM\11AUN1.SGM
U.S.C. 78s(d)(1); 17 CFR 240.19d–1(c)(2).
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Federal Register / Vol. 85, No. 155 / Tuesday, August 11, 2020 / Notices
August 26, 2020, the Commission may,
by order, declare the Exchange proposed
MRVP effective if the plan is consistent
with the public interest, the protection
of investors, or otherwise in furtherance
of the purposes of the Act. The
Commission in its order may restrict the
categories of violations to be designated
as minor rule violations and may
impose any other terms or conditions to
the proposed MRVP, File No. 4–764,
and to the period of its effectiveness,
which the Commission deems necessary
or appropriate in the public interest, for
the protection of investors or otherwise
in furtherance of the purposes of the
Act.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–17453 Filed 8–10–20; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–89484; File No. SR–MSRB–
2020–04]
Self-Regulatory Organizations;
Municipal Securities Rulemaking
Board; Order Granting Approval of a
Proposed Rule Change Consisting of
Amendments to MSRB Rules A–3 and
A–6 That Are Designed To Improve
Board Governance
August 5, 2020.
I. Introduction
On June 5, 2020, the Municipal
Securities Rulemaking Board (the
‘‘MSRB’’ or ‘‘Board’’) filed with the
Securities and Exchange Commission
(the ‘‘SEC’’ or ‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’ or
‘‘Exchange Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change
consisting of amendments to MSRB
Rules A–3 and A–6, regarding Board
governance (the ‘‘proposed rule
change’’). The proposed rule change was
published for comment in the Federal
Register on June 24, 2020.3
The Commission received five
comment letters on the proposed rule
change.4 On July 29, 2020, the MSRB
7 17
CFR 200.30–3(a)(44).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 Securities Exchange Act Release No. 89092
(June 18, 2020) (the ‘‘Notice of Filing’’), 85 FR
37974 (June 24, 2020).
4 See Letter to Secretary, Commission, from Steve
Apfelbacher, Renee Boicourt, Marianne Edmonds,
Robert Lamb and Noreen White, former MSRB
1 15
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17:02 Aug 10, 2020
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responded to those comments.5 This
order approves the proposed rule
change.
II. Description of Proposed Rule Change
As described further below and in the
Notice of Filing, the MSRB proposed
amendments designed to improve Board
governance that would: (i) Extend to
five years the length of time that an
individual must have been separated
from employment or other association
with any regulated entity to serve as a
public representative to the Board; (ii)
reduce the Board’s size from 21 to 15
members through a transition plan that
includes an interim year in which the
Board will have 17 members; (iii)
replace the requirement that at least one
and not less than 30% of regulated
members on the 21-member Board be
municipal advisors with a requirement
that the 15-member Board include at
least two municipal advisors; (iv)
impose a six-year limit on Board
service; (v) remove overly prescriptive
detail from the description of the
Board’s nominations process while
preserving in the rule the key
substantive requirements; (vi) require
that any Board committee with
responsibilities for nominations,
governance, or audit be chaired by a
public representative; and (vii) make
certain other reorganizational and
technical changes.6
The MSRB requested that the
proposed rule change become effective
on October 1, 2020.7
Board members (collectively, ‘‘Former MSRB Board
Members’’), dated July 15, 2020 (the ‘‘Former MSRB
Board Members Letter’’); Letter to Secretary,
Commission, from Emily Swenson Brock, Director,
Federal Liaison Center, Government Finance
Officers Association (‘‘GFOA’’), dated July 15, 2020
(the ‘‘GFOA Letter’’); Letter to Secretary,
Commission, from Emily Brock, GFOA, John
Godfrey, American Public Power Association,
Charles Thompson, International Municipal
Lawyers Association, Eryn Hurley, National
Association of Counties, Chuck Samuels, National
Assn. of Health and Educational Facilities Finance
Authorities, Cornelia Chebinou, National
Association of State Auditors, Comptrollers and
Treasurers, Brian Egan, National Association of
State Treasurers, Michael Gleeson, National League
of Cities, and Emery Real Bird, Native American
Finance Officers Association (collectively, the
‘‘Issuer Organizations’’), dated July 15, 2020 (the
‘‘Issuer Organizations Letter’’); Letter to Secretary,
Commission, from Susan Gaffney, Executive
Director, National Association of Municipal
Advisors (‘‘NAMA’’), dated July 15, 2020 (the
‘‘NAMA Letter’’); and Letter to Secretary,
Commission, from Mike Nicholas, Chief Executive
Officer, Bond Dealers of America (‘‘BDA’’), dated
July 15, 2020 (the ‘‘BDA Letter’’).
5 See Letter to Secretary, Commission, from Jacob
N. Lesser, Associate General Counsel, Municipal
Securities Rulemaking Board (‘‘MSRB’’), dated July
29, 2020 (the ‘‘MSRB Response Letter’’).
6 See Notice of Filing, 85 FR at 37974.
7 Id.
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48579
Background
The Exchange Act establishes basic
requirements for the Board’s size and
composition and requires the Board to
adopt rules that establish ‘‘fair
procedures for the nomination and
election of members of the Board and
assure fair representation in such
nominations and elections.’’ 8 As
amended by the Dodd-Frank Wall Street
Reform and Consumer Protection Act of
2010 (the ‘‘Dodd-Frank Act’’), the
Exchange Act categorizes Board
members in two broad groups:
Individuals who must be independent
of any dealer 9 or municipal advisor
(‘‘public representatives’’) and
individuals who must be associated
with a dealer or municipal advisor
(‘‘regulated representatives’’).10 The
Exchange Act requires the Board to
establish by rule requirements regarding
the independence of public
representatives and provides that all
Board members—whether public or
regulated representatives—must be
‘‘knowledgeable of matters related to the
municipal securities markets.’’ 11
Within the public representative
category, at least one Board member
must be representative of institutional
or retail investors in municipal
securities, at least one must be
representative of municipal entities, and
at least one must be a member of the
public with knowledge of or experience
in the municipal industry.12 Within the
regulated representative category, at
least one Board member must be
associated with a dealer that is a bank,
at least one must be associated with a
dealer that is not a bank, and at least
one must be associated with a
municipal advisor.13
The MSRB states that the Exchange
Act, as amended by the Dodd-Frank Act,
recognizes the benefits that a Board
composed of both public and regulated
representatives brings to regulation of
the municipal securities market in the
public interest and the protection of
investors, municipal entities, and
obligated persons.14 The MSRB further
states that, although regulated
representatives may bring specialized
expertise to the regulation of a market
with features and functions that are
markedly different from those of other
financial markets, public representatives
8 15
U.S.C. 78o–4(b)(2)(B).
used herein, the term ‘‘dealer’’ refers to a
broker, dealer, or municipal securities dealer.
10 15 U.S.C. 78o–4(b)(1).
11 15 U.S.C. 78o–4(b)(1); 15 U.S.C. 78o–
4(b)(2)(B)(iv).
12 15 U.S.C. 78o–4(b)(1).
13 Id.
14 See Notice of Filing, 85 FR at 37975.
9 As
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]]>Agencies
[Federal Register Volume 85, Number 155 (Tuesday, August 11, 2020)]
[Notices]
[Pages 48577-48579]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17453]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-89485; File No. 4-764]
Self-Regulatory Organizations; MEMX LLC; Notice of Filing of
Proposed Minor Rule Violation Plan
August 5, 2020.
Pursuant to Section 19(d)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19d-l(c)(2) thereunder,\2\ notice is hereby
given that on August 5, 2020, MEMX LLC (``MEMX'' or the ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') a
proposed minor rule violation plan (``MRVP'') with sanctions not
exceeding $2,500 which would not be subject to the provisions of Rule
19d-1(c)(1) of the Act \3\ requiring that a self-regulatory
organization (``SRO'') promptly file notice with the Commission of any
final disciplinary action taken with respect to any person or
organization.\4\ In
[[Page 48578]]
accordance with Rule 19d-l(c)(2) under the Act, the Exchange proposes
to designate certain specified rule violations as minor rule violations
and requests that it be relieved of the prompt reporting requirements
regarding such violations, provided it gives notice of such violations
to the Commission on a quarterly basis.
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\1\ 15 U.S.C. 78s(d)(1).
\2\ 17 CFR 240.19d-1(c)(2).
\3\ 17 CFR 240.19d-1(c)(1).
\4\ The Commission adopted amendments to paragraph (c) of Rule
19d-l to allow SROs to submit for Commission approval plans for the
abbreviated reporting of minor disciplinary infractions. See
Securities Exchange Act Release No. 21013 (June 1, 1984), 49 FR
23828 (June 8, 1984). Any disciplinary action taken by an SRO
against any person for violation of a rule of the SRO which has been
designated as a minor rule violation pursuant to such a plan filed
with and declared effective by the Commission is not considered
``final'' for purposes of Section 19(d)(1) of the Act if the
sanction imposed consists of a fine not exceeding $2,500 and the
sanctioned person has not sought an adjudication, including a
hearing, or otherwise exhausted his administrative remedies.
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The Exchange proposes to include in its MRVP the procedures
included in Exchange Rule 8.15 (``Imposition of Fines for Minor
Violation(s) of Rules'') and the violations included in Rule 8.15.01
(``List of Exchange Rule Violations and Recommended Fine Schedule
Pursuant to Rule 8.15'').\5\ According to the Exchange's MRVP, under
Rule 8.15(a), the Exchange may impose a fine (not to exceed $2,500) on
any Member, associated person of a Member, or registered or non-
registered employee of a Member, for any violation of a Rule of the
Exchange which violation the Exchange shall have determined is minor in
nature, as set forth in Rule 8.15.01. The Exchange may aggregate
similar violations generally if the conduct was unintentional, there
was no injury to public investors, or the violations resulted from a
single systemic problem or cause that has been corrected. In any action
taken by the Exchange pursuant to Rule 8.15, the person against whom a
fine is imposed shall be served with a written statement, signed by an
authorized officer of the Exchange, setting forth (i) the Rule or Rules
alleged to have been violated; (ii) the act or omission constituting
each such violation; (iii) the fine imposed for each such violation;
and (iv) the date by which such determination becomes final and such
fine becomes due and payable to the Exchange. Pursuant to paragraph (c)
of Rule 8.15, if the person against whom a fine is imposed pursuant to
Rule 8.15 pays such fine, that payment shall be deemed to be a waiver
by of such person's right to a disciplinary proceeding under Rules 8.1
through 8.13 and any review of the matter by the Appeals Committee or
by the Board. Any person against whom a fine is imposed pursuant to
Rule 8.15 may contest such a finding pursuant to paragraph (d) of Rule
8.15 by filing with the Exchange not later than the date by which such
determination must be contested (such date to be not less than 15
business days after the date of service of the written statement by the
Exchange) a written response meeting the requirements provided in Rule
8.5 at which point the matter shall become a disciplinary proceeding
subject to the provisions of Rules 8.1 through 8.13.
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\5\ The Exchange received its grant of registration on May 4,
2020, which included approving the rules that govern the Exchange.
Exhibit A includes the entirety of Rules 8.15 and 8.15.01. Terms not
otherwise defined herein are defined in the Exchange Rules.
Contemporaneous with this filing, the Exchange filed with the
Commission a rule filing that proposes a minor amendment to Rule
8.15(a) and a proposed change to Rule 8.15.01 to add Rules 4.5
through 4.16 (Consolidated Audit Trail Compliance Rules). This
submission proposes the Exchange's MRVP, including those proposed
changes to Rules 8.15 and 8.15.01. See SR-MEMX-2020-03, filed July
31, 2020, available at: https://info.memxtrading.com/category/rule-filings/.
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The Exchange proposes that, as set forth in Exchange Rule 8.15.01,
violations of the following rules would be appropriate for disposition
under the MRVP: Rule 4.2 and Interpretations thereunder (requiring the
submission of responses to Exchange requests for trading data within
specified time period); Rule 11.10(a)(5) (requirement to identify short
sale orders as such); Rule 11.10(f) (requirement to comply with locked
and crossed market rules); Rule 3.5 (Advertising Practices); Rule 12.11
Interpretations and Policy .01 and Exchange Act Rule 604 (failure to
properly display limit orders); Rule 4.2 and Interpretations thereunder
(related to the requirement to furnish Exchange-related order, market
and transaction data, as well as financial or regulatory records and
information); Rule 11.20(a)(1) (requirement for Market Makers to
maintain continuous two-sided quotations); and Rules 4.5 through 4.16
(Consolidated Audit Trail Compliance Rules).
Upon the Commission's declaration of effectiveness of the MRVP, the
Exchange will provide to the Commission a quarterly report for any
actions taken on minor rule violations under the MRVP. The quarterly
report will include: The Exchange's internal file number for the case,
the name of the individual and/or organization, the nature of the
violation, the specific rule provision violated, the fine imposed, the
number of times the rule violation occurred, and the date of the
disposition.
Based on compliance with the above, the Exchange requests that the
rule violations designated in Exchange Rule 8.15.01 be designated as
minor rule violations subject to a minor rule violation reporting plan
and that the Exchange be relieved of the current reporting requirements
regarding such violations. In addition, going forward, to the extent
that there are any changes to the rules applicable to the Exchange's
MRVP, the Exchange requests that the Commission deem such changes to be
modifications to the Exchange's MRVP.
I. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the Exchange's proposed MRVP, including whether
the proposed MRVP 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 4-764 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 4-764. 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 MRVP that are filed with the
Commission, and all written communications relating to the proposed
MRVP 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 proposed MRVP 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 4-764, and should be submitted
on or before August 26, 2020.
II. Date of Effectiveness of the Proposed Minor Rule Violation Plan and
Timing for Commission Action
Pursuant to Section 19(d)(l) of the Act and Rule 19d-l(c)(2)
thereunder,\6\ after
[[Page 48579]]
August 26, 2020, the Commission may, by order, declare the Exchange
proposed MRVP effective if the plan is consistent with the public
interest, the protection of investors, or otherwise in furtherance of
the purposes of the Act. The Commission in its order may restrict the
categories of violations to be designated as minor rule violations and
may impose any other terms or conditions to the proposed MRVP, File No.
4-764, and to the period of its effectiveness, which the Commission
deems necessary or appropriate in the public interest, for the
protection of investors or otherwise in furtherance of the purposes of
the Act.
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\6\ 15 U.S.C. 78s(d)(1); 17 CFR 240.19d-1(c)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\7\
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\7\ 17 CFR 200.30-3(a)(44).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-17453 Filed 8-10-20; 8:45 am]
BILLING CODE 8011-01-P
