Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend IEX Rules 2.220(a)(7) and 11.410(a) To Include MEMX LLC in the List of Away Trading Centers to Which the Exchange Routes and the Market Data Sources the Exchange Will Use To Determine MEMX's Top of Book Quotation, 51828-51830 [2020-18349]
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51828
Federal Register / Vol. 85, No. 163 / Friday, August 21, 2020 / Notices
of the purposes of the Act. Rather, the
Exchange believes that the proposal will
promote competition by permitting the
Exchange to sell a data product similar
to those offered by other competitor
options exchanges.16 The Exchange
made Open-Close Data available in
order to keep pace with changes in the
industry and evolving customer needs,
and believes the data product will
contribute to robust competition among
national securities exchanges. At least
four other U.S. options exchanges offer
a market data product that is
substantially similar to the Intraday
Open-Close Data. As a result, the
Exchange believes this proposed rule
change permits fair competition among
national securities exchanges.
Furthermore, the Exchange operates
in a highly competitive environment,
and its ability to price Intraday OpenClose Data is constrained by
competition among exchanges that offer
similar data products to their customers.
As discussed, there are currently a
number of similar products available to
market participants and investors. At
least four other U.S. options exchanges
offer a market data product that is
substantially similar to the Intraday
Open-Close Data, which the Exchange
must consider in its pricing discipline
in order to compete for the market
data.17 For example, proposing fees that
are excessively higher than established
fees for similar data products would
simply serve to reduce demand for the
Exchange’s data product, which as
discussed, market participants are under
no obligation to utilize. In this
competitive environment, potential
purchasers are free to choose which, if
any, similar product to purchase to
satisfy their need for market
information. As a result, the Exchange
believes this proposed rule change
permits fair competition among national
securities exchanges.
The Exchange also does not believe
the proposed fees would cause any
unnecessary or in appropriate burden
on intermarket competition as other
exchanges are free to introduce their
own comparable data product and lower
their prices to better compete with the
Exchange’s offering. The Exchange does
not believe the proposed rule change
would cause any unnecessary or
inappropriate burden on intramarket
competition. Particularly, the proposed
product and fees apply uniformly to any
purchaser, in that it does not
16 Id.
17 See
e.g., Cboe Options Fees Schedule, Livevol
Fees, Open-Close Data. See also Nasdaq ISE Options
7 Pricing Schedule, Section 10.A and Nasdaq PHLX
Options 7 Pricing Schedule, Section 10, PHLX
Options Trade Outline (‘‘PHOTO’’).
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19:04 Aug 20, 2020
Jkt 250001
differentiate between subscribers that
purchase Intraday Open-Close Data. The
proposed fees are set at a modest level
that would allow any interested Member
or non-Member to purchase such data
based on their business needs.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange has neither solicited
nor received written comments on the
proposed rule change.
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)
of the Act 18 and paragraph (f) of Rule
19b–4 19 thereunder, because it
establishes a due, fee, or other charge
imposed by the Exchange.
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission will institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
CboeBZX–2020–063 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–CboeBZX–2020–063. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
18 15
19 17
PO 00000
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f).
Frm 00155
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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;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–
CboeBZX–2020–063 and should be
submitted on or before September 11,
2020.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.20
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–18356 Filed 8–20–20; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–89580; File No. SR–IEX–
2020–11]
Self-Regulatory Organizations;
Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend IEX
Rules 2.220(a)(7) and 11.410(a) To
Include MEMX LLC in the List of Away
Trading Centers to Which the
Exchange Routes and the Market Data
Sources the Exchange Will Use To
Determine MEMX’s Top of Book
Quotation
August 17, 2020.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
20 17
1 15
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CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
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‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that on August
12, 2020, the Investors Exchange LLC
(‘‘IEX’’ or the ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(the ‘‘Commission’’) the proposed rule
change as described in Items I, and II
below, which Items have been prepared
by the self-regulatory 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
Pursuant to the provisions of Section
19(b)(1) under the Act,4 and Rule 19b–
4 thereunder,5 IEX is filing with the
Commission a proposed rule change to
amend IEX Rules 2.220(a)(7) and
11.410(a) to include MEMX LLC
(‘‘MEMX’’) in the list of away trading
centers to which the Exchange routes
and the market data sources the
Exchange will use to determine MEMX’s
Top of Book 6 quotation, in anticipation
of MEMX’s planned launch. The
Exchange has designated this rule
change as ‘‘non-controversial’’ under
Section 19(b)(3)(A) of the Act 7 and
provided the Commission with the
notice required by Rule 19b–4(f)(6)
thereunder.8
The text of the proposed rule change
is available at the Exchange’s website at
www.iextrading.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
jbell on DSKJLSW7X2PROD with NOTICES
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 these statement [sic] may be
examined at the places specified in Item
IV below. The self-regulatory
organization has prepared summaries,
set forth in Sections A, B, and C below,
of the most significant aspects of such
statements.
2 15
U.S.C. 78a.
CFR 240.19b–4.
4 15 U.S.C. 78s(b)(1).
5 17 CFR 240.19b–4.
6 See IEX Rule 11.410(a)(1).
7 15 U.S.C. 78s(b)(3)(A).
8 17 CFR 240.19b–4.
3 17
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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 IEX
Rules 2.220(a)(7) 9 and 11.410(a) 10 to
include MEMX LLC (‘‘MEMX’’) in the
list of away trading centers to which the
Exchange routes and the market data
sources the Exchange will use to
determine Top of Book 11 quotations, in
anticipation of MEMX’s planned
exchange launch on September 4,
2020.12
Specifically, the Exchange proposes to
amend IEX Rule 2.220(a)(7) to add
MEMX LLC to the list of away trading
centers to which IEX Services routes
orders. As set forth in IEX Rule
11.230(b)(2), IEX Services routes eligible
orders to away trading centers with
accessible Protected Quotations in
compliance with Regulation NMS Rule
611.13 The Exchange must include
MEMX in its list of away trading centers
to which it routes, because MEMX’s
best-priced, displayed quotation will be
a Protected Quotation under Regulation
NMS Rule 600(b)(62) 14 for purposes of
Regulation NMS Rule 611.15
The Exchange also proposes to amend
and update the table in IEX Rule
11.410(a) specifying the primary and
secondary sources for MEMX market
data as a result of MEMX’s
establishment of MEMOIR Depth and
MEMOIR Top 16 (‘‘MEMX Market Data
Feeds’’ or ‘‘direct feeds’’). As specified
in IEX Rule 11.410(a)(2), the Exchange
uses market data from each away
trading center that produces a Protected
Quotation 17 to determine each away
trading center’s Top of Book quotation,
as well as the NBBO 18 for certain
reporting, regulatory and compliance
systems within IEX. As proposed, the
Exchange will use the direct feeds as the
primary source to determine MEMX’s
Top of Book quotes. The Exchange also
proposes to use securities information
9 IEX Rule 2.220(a)(7) lists the away trading
centers that IEX Services LLC (‘‘IEX Services’’)
routes to as outbound router for the Exchange.
10 IEX Rule 11.410(a) specifies the market data
sources for each away trading center that the
Exchange uses for necessary price reference points.
11 See IEX Rule 11.410(a)(1).
12 See https://memx.com/memx-update/.
13 17 CFR 242.611.
14 17 CFR 242.600(b)(62).
15 See Securities Exchange Act Release No. 88806
(May 4, 2020), 85 FR 27451, 27461 (May 8, 2020)
(File No. 10–237) (Order approving MEMX
application for registration as a national securities
exchange).
16 See MEMX Rule 13.8.
17 See IEX Rule 1.160(bb).
18 See IEX Rule 1.160(u).
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51829
processor (‘‘SIP’’) data, i.e., CQS SIP
data for securities reported under the
Consolidated Quotation Services and
Consolidated Tape Association plans
and UQDF SIP data for securities
reported under the Nasdaq Unlisted
Trading Privileges plan, as the
secondary source to determine MEMX’s
Top of Book quotes.
The Exchange is not proposing any
other changes to IEX Rules 2.220(a)(7)
and 11.410. The proposed changes do
not alter the manner in which orders are
handled or routed by the Exchange.
2. Statutory Basis
IEX believes that the proposed rule
change is consistent with the provisions
of Section 6(b) 19 of the Act in general,
and furthers the objectives of Section
6(b)(5) of the Act 20 in particular, in that
it is designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, 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.
For the reasons discussed in the
Purpose section, the Exchange believes
that the proposed rule change removes
impediments to and perfects the
mechanism of a free and open market
and protects investors and the public
interest because including MEMX in the
list of away trading centers to which IEX
routes and including the MEMX Market
Data Feeds in the primary sources of
market data the Exchange will use to
determine away trading center Top of
Book quotes (with the SIP as the
secondary source) will facilitate the
Exchange’s compliance with the
applicable requirements of Regulation
NMS.
Additionally, adding MEMX to the
list of away trading centers to which IEX
routes and listing the MEMX Market
Data Feeds as the primary source of
market data the Exchange will use to
determine away trading center Top of
Book quotes (with the SIP as the
secondary source) provides
transparency with respect to the away
trading centers to which IEX Services
may route orders and the source of
market data the Exchange will use to
determine MEMX’s Top of Book quotes.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
IEX does not believe that the
proposed rule change will result in any
burden on competition that is not
necessary or appropriate in furtherance
19 15
20 15
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U.S.C. 78f.
U.S.C. 78f(b)(5).
21AUN1
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Federal Register / Vol. 85, No. 163 / Friday, August 21, 2020 / Notices
of the purposes of the Act. The
Exchange believes that the proposed
update does not impact competition in
any respect since its purpose is to
enhance transparency with respect to
the operation of the Exchange and its
use of market data feeds, and to update
an away market name.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
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 21 and Rule 19b–
4(f)(6) thereunder.22
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 23 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b–4(f)(6)(iii) 24
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 proposed rule change will merely
amend IEX rules to reflect the launch of
MEMX as an away trading center with
a Protected Quote and specify that IEX
will route orders to MEMX and use the
MEMX Market Data Feeds as the
primary source, and the SIP as the
secondary source, to determine MEMX’s
Top of Book quotation.
The Exchange believes that waiver of
the operative delay is consistent with
the protection of investors and the
public interest because it will allow the
Exchange to implement the proposed
rule change concurrent with MEMX’s
exchange launch of equities trading,
thereby facilitating IEX’s compliance
21 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.
23 17 CFR 240.19b–4(f)(6).
24 17 CFR 240.19b–4(f)(6)(iii).
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22 17
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with the applicable requirements of
Regulation NMS and providing clarity
to market participants with respect to
whether IEX routes to MEMX and how
IEX determines MEMX’s Top of Book
quotation. The Commission believes
that waiver of the 30-day operative
delay is consistent with the protection
of investors and the public interest
because the proposed rule change does
not raise any new or novel issues.
Therefore, the Commission hereby
waives the operative delay and
designates the proposal as operative
upon filing.25
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
under Section 19(b)(2)(B) 26 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–
IEX–2020–11 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–IEX–2020–11. 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
25 For purposes only of waiving the 30-day
operative delay, the Commission also has
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
26 15 U.S.C. 78s(b)(2)(B).
PO 00000
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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 will also be available for
inspection and copying at the IEX’s
principal office and on its internet
website at www.iextrading.com. 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–IEX–2020–11 and
should be submitted on or before
September 11, 2020.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.27
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–18349 Filed 8–20–20; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–89578; File No. SR–BX–
2020–020]
Self-Regulatory Organizations; Nasdaq
BX, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend Options 6,
Section 5 (Transfer of Positions)
August 17, 2020.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on August 6,
2020, Nasdaq BX, Inc. (‘‘BX’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission (the
‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The Exchange filed the
proposal as a ‘‘non-controversial’’
27 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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21AUN1
]]>Agencies
[Federal Register Volume 85, Number 163 (Friday, August 21, 2020)]
[Notices]
[Pages 51828-51830]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-18349]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-89580; File No. SR-IEX-2020-11]
Self-Regulatory Organizations; Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend IEX
Rules 2.220(a)(7) and 11.410(a) To Include MEMX LLC in the List of Away
Trading Centers to Which the Exchange Routes and the Market Data
Sources the Exchange Will Use To Determine MEMX's Top of Book Quotation
August 17, 2020.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the
[[Page 51829]]
``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that
on August 12, 2020, the Investors Exchange LLC (``IEX'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, and
II below, which Items have been prepared by the self-regulatory
organization. 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\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Pursuant to the provisions of Section 19(b)(1) under the Act,\4\
and Rule 19b-4 thereunder,\5\ IEX is filing with the Commission a
proposed rule change to amend IEX Rules 2.220(a)(7) and 11.410(a) to
include MEMX LLC (``MEMX'') in the list of away trading centers to
which the Exchange routes and the market data sources the Exchange will
use to determine MEMX's Top of Book \6\ quotation, in anticipation of
MEMX's planned launch. The Exchange has designated this rule change as
``non-controversial'' under Section 19(b)(3)(A) of the Act \7\ and
provided the Commission with the notice required by Rule 19b-4(f)(6)
thereunder.\8\
---------------------------------------------------------------------------
\4\ 15 U.S.C. 78s(b)(1).
\5\ 17 CFR 240.19b-4.
\6\ See IEX Rule 11.410(a)(1).
\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
The text of the proposed rule change is available at the Exchange's
website at www.iextrading.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 these statement [sic] may be examined
at the places specified in Item IV below. The self-regulatory
organization 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 IEX Rules 2.220(a)(7) \9\ and
11.410(a) \10\ to include MEMX LLC (``MEMX'') in the list of away
trading centers to which the Exchange routes and the market data
sources the Exchange will use to determine Top of Book \11\ quotations,
in anticipation of MEMX's planned exchange launch on September 4,
2020.\12\
---------------------------------------------------------------------------
\9\ IEX Rule 2.220(a)(7) lists the away trading centers that IEX
Services LLC (``IEX Services'') routes to as outbound router for the
Exchange.
\10\ IEX Rule 11.410(a) specifies the market data sources for
each away trading center that the Exchange uses for necessary price
reference points.
\11\ See IEX Rule 11.410(a)(1).
\12\ See https://memx.com/memx-update/.
---------------------------------------------------------------------------
Specifically, the Exchange proposes to amend IEX Rule 2.220(a)(7)
to add MEMX LLC to the list of away trading centers to which IEX
Services routes orders. As set forth in IEX Rule 11.230(b)(2), IEX
Services routes eligible orders to away trading centers with accessible
Protected Quotations in compliance with Regulation NMS Rule 611.\13\
The Exchange must include MEMX in its list of away trading centers to
which it routes, because MEMX's best-priced, displayed quotation will
be a Protected Quotation under Regulation NMS Rule 600(b)(62) \14\ for
purposes of Regulation NMS Rule 611.\15\
---------------------------------------------------------------------------
\13\ 17 CFR 242.611.
\14\ 17 CFR 242.600(b)(62).
\15\ See Securities Exchange Act Release No. 88806 (May 4,
2020), 85 FR 27451, 27461 (May 8, 2020) (File No. 10-237) (Order
approving MEMX application for registration as a national securities
exchange).
---------------------------------------------------------------------------
The Exchange also proposes to amend and update the table in IEX
Rule 11.410(a) specifying the primary and secondary sources for MEMX
market data as a result of MEMX's establishment of MEMOIR Depth and
MEMOIR Top \16\ (``MEMX Market Data Feeds'' or ``direct feeds''). As
specified in IEX Rule 11.410(a)(2), the Exchange uses market data from
each away trading center that produces a Protected Quotation \17\ to
determine each away trading center's Top of Book quotation, as well as
the NBBO \18\ for certain reporting, regulatory and compliance systems
within IEX. As proposed, the Exchange will use the direct feeds as the
primary source to determine MEMX's Top of Book quotes. The Exchange
also proposes to use securities information processor (``SIP'') data,
i.e., CQS SIP data for securities reported under the Consolidated
Quotation Services and Consolidated Tape Association plans and UQDF SIP
data for securities reported under the Nasdaq Unlisted Trading
Privileges plan, as the secondary source to determine MEMX's Top of
Book quotes.
---------------------------------------------------------------------------
\16\ See MEMX Rule 13.8.
\17\ See IEX Rule 1.160(bb).
\18\ See IEX Rule 1.160(u).
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The Exchange is not proposing any other changes to IEX Rules
2.220(a)(7) and 11.410. The proposed changes do not alter the manner in
which orders are handled or routed by the Exchange.
2. Statutory Basis
IEX believes that the proposed rule change is consistent with the
provisions of Section 6(b) \19\ of the Act in general, and furthers the
objectives of Section 6(b)(5) of the Act \20\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, 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.
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\19\ 15 U.S.C. 78f.
\20\ 15 U.S.C. 78f(b)(5).
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For the reasons discussed in the Purpose section, the Exchange
believes that the proposed rule change removes impediments to and
perfects the mechanism of a free and open market and protects investors
and the public interest because including MEMX in the list of away
trading centers to which IEX routes and including the MEMX Market Data
Feeds in the primary sources of market data the Exchange will use to
determine away trading center Top of Book quotes (with the SIP as the
secondary source) will facilitate the Exchange's compliance with the
applicable requirements of Regulation NMS.
Additionally, adding MEMX to the list of away trading centers to
which IEX routes and listing the MEMX Market Data Feeds as the primary
source of market data the Exchange will use to determine away trading
center Top of Book quotes (with the SIP as the secondary source)
provides transparency with respect to the away trading centers to which
IEX Services may route orders and the source of market data the
Exchange will use to determine MEMX's Top of Book quotes.
B. Self-Regulatory Organization's Statement on Burden on Competition
IEX does not believe that the proposed rule change will result in
any burden on competition that is not necessary or appropriate in
furtherance
[[Page 51830]]
of the purposes of the Act. The Exchange believes that the proposed
update does not impact competition in any respect since its purpose is
to enhance transparency with respect to the operation of the Exchange
and its use of market data feeds, and to update an away market name.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
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 \21\ and Rule 19b-
4(f)(6) thereunder.\22\
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\21\ 15 U.S.C. 78s(b)(3)(A).
\22\ 17 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.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \23\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \24\ 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.
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\23\ 17 CFR 240.19b-4(f)(6).
\24\ 17 CFR 240.19b-4(f)(6)(iii).
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The proposed rule change will merely amend IEX rules to reflect the
launch of MEMX as an away trading center with a Protected Quote and
specify that IEX will route orders to MEMX and use the MEMX Market Data
Feeds as the primary source, and the SIP as the secondary source, to
determine MEMX's Top of Book quotation.
The Exchange believes that waiver of the operative delay is
consistent with the protection of investors and the public interest
because it will allow the Exchange to implement the proposed rule
change concurrent with MEMX's exchange launch of equities trading,
thereby facilitating IEX's compliance with the applicable requirements
of Regulation NMS and providing clarity to market participants with
respect to whether IEX routes to MEMX and how IEX determines MEMX's Top
of Book quotation. The Commission believes that waiver of the 30-day
operative delay is consistent with the protection of investors and the
public interest because the proposed rule change does not raise any new
or novel issues. Therefore, the Commission hereby waives the operative
delay and designates the proposal as operative upon filing.\25\
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\25\ For purposes only of waiving the 30-day operative delay,
the Commission also has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \26\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\26\ 15 U.S.C. 78s(b)(2)(B).
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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-IEX-2020-11 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-IEX-2020-11. 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 will also be available for inspection
and copying at the IEX's principal office and on its internet website
at www.iextrading.com. 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-IEX-2020-11
and should be submitted on or before September 11, 2020.
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\27\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\27\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-18349 Filed 8-20-20; 8:45 am]
BILLING CODE 8011-01-P
