Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Designation of a Longer Period for Commission Action on a Proposed Rule Change, as Modified by Amendment No. 1, To Amend Rule 5.24, 49696-49697 [2020-17756]

Download as PDF 49696 Federal Register / Vol. 85, No. 158 / Friday, August 14, 2020 / Notices III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 13 and Rule 19b– 4(f)(6) thereunder.14 A proposed rule change filed pursuant to Rule 19b–4(f)(6) under the Act 15 normally does not become operative for 30 days from the date of filing. However, Rule 19b–4(f)(6)(iii) 16 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay. The Commission notes that the Exchange plans to implement the Gross Executed Risk Exposure and the Gross Notional Risk Exposure risk settings as soon as possible.17 The Commission believes that waiver of the operative delay would allow the Exchange to provide PSX Participants and their clearing members expeditiously with additional optional settings to manage their risk levels. The Commission believes that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest. Accordingly, the Commission waives the 30-day operative delay and designates the proposed rule change operative upon filing.18 At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of 13 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6)(iii) requires a self-regulatory organization to give the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. 15 17 CFR 240.19b–4(f)(6). 16 17 CFR 240.19b–4(f)(6)(iii). 17 According to the Exchange, the Maximum Single Order Notional Check will be implemented within 90 days following the effective date. 18 For purposes only of waiving the 30-day operative delay, the Commission has also considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). khammond on DSKJM1Z7X2PROD with NOTICES 14 17 VerDate Sep<11>2014 17:29 Aug 13, 2020 Jkt 250001 the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule change should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments be submitted on or before September 4, 2020. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2020–17754 Filed 8–13–20; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–89514; File No. SR–CBOE– 2020–055] • Use the Commission’s internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– Phlx–2020–37 on the subject line. Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Designation of a Longer Period for Commission Action on a Proposed Rule Change, as Modified by Amendment No. 1, To Amend Rule 5.24 Paper comments: August 10, 2020. • 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–Phlx–2020–37. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s internet website (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for website viewing and printing in the Commission’s Public Reference Room, 100 F Street NE, Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–Phlx–2020–37 and should PO 00000 Frm 00081 Fmt 4703 Sfmt 4703 On June 12, 2020, Cboe Exchange, Inc. (the ‘‘Exchange’’ or ‘‘Cboe Options’’) 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 Rule 5.24 by permitting a virtual trading floor as a business continuity and disaster recovery plan. The proposed rule change was published for comment in the Federal Register on June 29, 2020.3 On July 23, 2020, the Exchange filed Amendment No. 1 to the proposed rule change.4 The Commission has received one comment letter on the proposed rule change.5 Section 19(b)(2) of the Act 6 provides that, within 45 days of the publication of notice of the filing of a proposed rule change, or within such longer period up to 90 days as the Commission may designate if it finds such longer period 19 17 CFR 200.30–3(a)(12). U.S.C.78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 89131 (June 23, 2020), 85 FR 38951. 4 In Amendment No. 1, the Exchange clarified that the temporary all-electronic trading rules set forth in Rule 5.24(e)(1) would not apply to classes engaged in the virtual trading floor. The Exchange also amended the proposal to permit clerks to access the virtual trading floor. When the Exchange filed Amendment No. 1 to CBOE–2020–055, it also submitted the text of the amendment as a comment letter to the filing, which the Commission made publicly available at https://www.sec.gov/ comments/sr-cboe-2020-055/srcboe20200557470763-221281.pdf. 5 See letter to Secretary, Commission, from Kevin Kennedy, Senior Vice President, Nasdaq, dated July 10, 2020, available at https://www.sec.gov/ comments/sr-cboe-2020-055/srcboe20200557409704-219196.pdf. 6 15 U.S.C. 78s(b)(2). 1 15 E:\FR\FM\14AUN1.SGM 14AUN1 Federal Register / Vol. 85, No. 158 / Friday, August 14, 2020 / Notices to be appropriate and publishes its reasons for so finding, or as to which the self-regulatory organization consents, the Commission shall either approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether the proposed rule change should be disapproved. The 45th day after publication of the notice for this proposed rule change is August 13, 2020. The Commission is extending this 45day time period. The Commission finds that it is appropriate to designate a longer period within which to take action on the proposal so that it has sufficient time to consider the proposed rule change, as modified by Amendment No. 1. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,7 designates September 27, 2020, as the date by which the Commission shall either approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change (File No. SR–CBOE–2020– 055), as modified by Amendment No. 1. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.8 J. Matthew DeLesDernier, Assistant Secretary. [FR Doc. 2020–17756 Filed 8–13–20; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–89515; File No. SR–OCC– 2020–805] Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing of Advance Notice Concerning Proposed Changes To Enhance OCC’s Stock Loan Close-Out Process August 10, 2020. khammond on DSKJM1Z7X2PROD with NOTICES Pursuant to Section 806(e)(1) of Title VIII of the Dodd-Frank Wall Street Reform and Consumer Protection Act, entitled Payment, Clearing and Settlement Supervision Act of 2010 (‘‘Clearing Supervision Act’’) 1 and Rule 19b–4(n)(1)(i) 2 under the Securities Exchange Act of 1934 (‘‘Exchange Act’’),3 notice is hereby given that on 7 Id. 8 17 CFR 200.30–3(a)(31). U.S.C. 5465(e)(1). 2 17 CFR 240.19b–4(n)(1)(i). 3 15 U.S.C. 78a et seq. 1 12 VerDate Sep<11>2014 17:29 Aug 13, 2020 Jkt 250001 July 14, 2020, the Options Clearing Corporation (‘‘OCC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) an advance notice as described in Items I, II and III below, which Items have been prepared by OCC. The Commission is publishing this notice to solicit comments on the advance notice from interested persons. I. Clearing Agency’s Statement of the Terms of Substance of the Advance Notice This advance notice is submitted in in connection with proposed changes to OCC Rules 2211 and 2211A, which concern the close-out of a defaulting Hedge Clearing Member’s or Market Loan Clearing Member’s (each a ‘‘defaulting Clearing Member’’) stock loan positions, respectively, to require Lending Clearing Members or Borrowing Clearing Members (each a ‘‘non-defaulting Clearing Member’’) whom OCC instructs to buy-in or sellout securities to execute such transactions and provide OCC notice of such action by the settlement time for a Clearing Member’s obligations to OCC on the business day after OCC gives the instruction.4 In addition, OCC proposes to amend Rules 2211 and 2211A to provide that if a non-defaulting Clearing Member so instructed does not execute the trades and provide notice by that time, OCC will terminate the Stock Loan and effect settlement based upon the Marking Price at the close of business on the day that OCC provided the instruction. OCC submitted the proposed amendments to OCC’s Rules in Exhibit 5. Material proposed to be added to OCC’s Rules as currently in effect is marked by underlining and material proposed to be deleted is marked with strikethrough text. All terms with initial capitalization that are not otherwise defined herein have the same meaning as set forth in the ByLaws and Rules.5 II. Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Advance Notice In its filing with the Commission, OCC included statements concerning the purpose of and basis for the advance notice and discussed any comments it 4 ‘‘Buy-in’’ refers to a non-defaulting lender purchasing replacement stock. ‘‘Sell-out’’ refers to a non-defaulting borrower selling the loaned securities in order to recoup its collateral. 5 OCC’s By-Laws and Rules can be found on OCC’s public website: https://optionsclearing.com/ about/publications/bylaws.jsp. PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 49697 received on the advance notice. The text of these statements may be examined at the places specified in Item IV below. OCC has prepared summaries, set forth in sections A and B below, of the most significant aspects of these statements. (A) Clearing Agency’s Statement on Comments on the Advance Notice Received From Members, Participants or Others Written comments were not and are not intended to be solicited with respect to the advance notice and none have been received. OCC will notify the Commission of any written comments received by OCC. (B) Advance Notices Filed Pursuant to Section 806(e) of the Payment, Clearing, and Settlement Supervision Act Description of the Change This advance notice concerns a change to OCC’s operations to amend OCC Rules 2211 and 2211A to ensure that OCC has authority and operational capacity to take timely action to contain losses and liquidity demands and continue to meet its obligations in the event of a Clearing Member default by more closely aligning the close-out of stock loan positions through buy-in and sell-out transactions with the timing of an auction of a defaulting Clearing Member’s other positions and to ensure that the close-out of a defaulting Clearing Member’s stock loan positions by buy-in or sell-out transactions occurs within OCC’s two-day liquidation assumption. The proposed amendments to the Rules are discussed in more detail below. Background OCC operates two programs in which it acts as a central counterparty for stock loan transactions: (1) The Stock Loan/ Hedge Program and (2) Market Loan Program (collectively, the ‘‘Stock Loan Programs’’). Stock Loan/Hedge Program transactions are initiated directly between Clearing Members on a bilateral basis (i.e., ‘‘broker-to-broker’’ model) and Market Loan Program transactions are initiated on either a broker-to-broker basis or anonymously through the matching of bids and offers (i.e., ‘‘market’’ model). Both programs rely on The Depository Trust Company (‘‘DTC’’) to facilitate the settlement of equity securities and cash collateral between members. E:\FR\FM\14AUN1.SGM 14AUN1

Agencies

[Federal Register Volume 85, Number 158 (Friday, August 14, 2020)]
[Notices]
[Pages 49696-49697]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17756]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-89514; File No. SR-CBOE-2020-055]


Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of 
Designation of a Longer Period for Commission Action on a Proposed Rule 
Change, as Modified by Amendment No. 1, To Amend Rule 5.24

August 10, 2020.
    On June 12, 2020, Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe 
Options'') 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 Rule 5.24 by permitting a virtual trading 
floor as a business continuity and disaster recovery plan. The proposed 
rule change was published for comment in the Federal Register on June 
29, 2020.\3\ On July 23, 2020, the Exchange filed Amendment No. 1 to 
the proposed rule change.\4\ The Commission has received one comment 
letter on the proposed rule change.\5\
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    \1\ 15 U.S.C.78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 89131 (June 23, 
2020), 85 FR 38951.
    \4\ In Amendment No. 1, the Exchange clarified that the 
temporary all-electronic trading rules set forth in Rule 5.24(e)(1) 
would not apply to classes engaged in the virtual trading floor. The 
Exchange also amended the proposal to permit clerks to access the 
virtual trading floor. When the Exchange filed Amendment No. 1 to 
CBOE-2020-055, it also submitted the text of the amendment as a 
comment letter to the filing, which the Commission made publicly 
available at https://www.sec.gov/comments/sr-cboe-2020-055/srcboe2020055-7470763-221281.pdf.
    \5\ See letter to Secretary, Commission, from Kevin Kennedy, 
Senior Vice President, Nasdaq, dated July 10, 2020, available at 
https://www.sec.gov/comments/sr-cboe-2020-055/srcboe2020055-7409704-219196.pdf.
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    Section 19(b)(2) of the Act \6\ provides that, within 45 days of 
the publication of notice of the filing of a proposed rule change, or 
within such longer period up to 90 days as the Commission may designate 
if it finds such longer period

[[Page 49697]]

to be appropriate and publishes its reasons for so finding, or as to 
which the self-regulatory organization consents, the Commission shall 
either approve the proposed rule change, disapprove the proposed rule 
change, or institute proceedings to determine whether the proposed rule 
change should be disapproved. The 45th day after publication of the 
notice for this proposed rule change is August 13, 2020.
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    \6\ 15 U.S.C. 78s(b)(2).
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    The Commission is extending this 45-day time period. The Commission 
finds that it is appropriate to designate a longer period within which 
to take action on the proposal so that it has sufficient time to 
consider the proposed rule change, as modified by Amendment No. 1. 
Accordingly, the Commission, pursuant to Section 19(b)(2) of the 
Act,\7\ designates September 27, 2020, as the date by which the 
Commission shall either approve or disapprove, or institute proceedings 
to determine whether to disapprove, the proposed rule change (File No. 
SR-CBOE-2020-055), as modified by Amendment No. 1.
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    \7\ Id.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(31).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-17756 Filed 8-13-20; 8:45 am]
BILLING CODE 8011-01-P
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