Self-Regulatory Organizations; MEMX LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Add Interpretation and Policy .03 to Exchange Rule 4.2 Regarding the Provision of Members' Broker-Dealer Annual Reports, 8453-8455 [2021-02395]
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Federal Register / Vol. 86, No. 23 / Friday, February 5, 2021 / Notices
the market system ‘‘has been remarkably
successful in promoting market
competition in its broader forms that are
most important to investors and listed
companies.’’ 17
For these reasons, the Exchange
believes that the proposed rule change
reflects this competitive environment
and does not impose any undue burden
on intermarket competition.
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
Within 45 days of the date of
publication of this notice in the Federal
Register or up to 90 days (i) as the
Commission may designate if it finds
such longer period to be appropriate
and publishes its reasons for so finding
or (ii) as to which the self-regulatory
organization consents, the Commission
will:
(A) By order approve or disapprove
the proposed rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be 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–2021–04 on the subject
line.
jbell on DSKJLSW7X2PROD with NOTICES
Paper Comments
• Send paper comments in triplicate
to: Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEAMER–2021–04. 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–NYSEAMER–2021–04 and
should be submitted on or before
February 26, 2021.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021–02407 Filed 2–4–21; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–91027; File No. SR–MEMX–
2021–01]
Self-Regulatory Organizations; MEMX
LLC; Notice of Filing and Immediate
Effectiveness of a Proposed Rule
Change To Add Interpretation and
Policy .03 to Exchange Rule 4.2
Regarding the Provision of Members’
Broker-Dealer Annual Reports
February 1, 2021.
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 January
21, 2021, MEMX LLC (‘‘MEMX’’ or the
‘‘Exchange’’) filed with the Securities
and Exchange Commission (the
17 See Regulation NMS Adopting Release, supra
note 12, at 37499.
VerDate Sep<11>2014
18:53 Feb 04, 2021
Jkt 253001
‘‘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 proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of
the Act 3 and Rule 19b–4(f)(6)
thereunder.4 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 is filing with the
Commission a proposed rule change to
add proposed Interpretation and Policy
.03 to Exchange Rule 4.2 that would
provide a waiver of the requirement that
members of the Exchange (‘‘Members’’)
for which the Exchange is not the
designated examining authority
(‘‘DEA’’) provide the Exchange with
copies of their broker-dealer annual
reports. The text of the proposed rule
change is provided in Exhibit 5.
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
SEC Rule 17a–5(d) 5 generally requires
each broker-dealer registered under
Section 15 of the Act to file with the
Commission and the broker-dealer’s
DEA certain financial-related reports
described in that rule on an annual basis
(such reports, ‘‘Annual Reports’’). SEC
Rule 17a–5(d)(6) 6 further requires each
broker-dealer to provide all selfregulatory organizations (‘‘SROs’’) of
which the broker-dealer is a member
with copies of its Annual Reports. The
Exchange proposes to add proposed
3 15
18 17
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
PO 00000
Frm 00117
Fmt 4703
Sfmt 4703
8453
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
5 17 CFR 240.17a–5(d).
6 17 CFR 240.17a–5(d)(6).
4 17
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Federal Register / Vol. 86, No. 23 / Friday, February 5, 2021 / Notices
jbell on DSKJLSW7X2PROD with NOTICES
Interpretation and Policy .03 to
Exchange Rule 4.2 to relieve Members
for which the Exchange is not the DEA
of the requirement of SEC Rule 17a–
5(d)(6) that a broker-dealer must provide
copies of its Annual Reports to the
Exchange.
In 2013 the Commission amended
certain broker-dealer annual reporting,
audit, and notification requirements.7
Among these amendments was an
amendment to paragraph (d)(6) of Rule
17a-5 to allow an SRO that is not a
broker-dealer’s DEA to waive by rule the
requirement that such broker-dealer
provide its Annual Reports to that
SRO.8 This amendment was proposed
because in some cases SROs do not
believe it is necessary to receive copies
of a broker-dealer’s Annual Reports,
particularly when an SRO is not the
broker-dealer’s DEA.9
The Exchange is not currently the
DEA for any of its Members and does
not expect to be the DEA for any of its
Members.10 The Exchange does not
believe it is necessary for it to receive
copies of Annual Reports from its
Members for which it is not the DEA, as
the Exchange does not anticipate using
any information contained therein in
order to carry out its regulatory
responsibilities. The Exchange believes
that receiving such information is
important for an SRO that is a brokerdealer’s DEA but not for an SRO that is
not the broker-dealer’s DEA, particularly
as one of the key responsibilities of a
broker-dealer’s DEA is to oversee such
broker-dealer’s compliance with
applicable financial responsibility rules.
Furthermore, the Exchange notes that
even with the proposed waiver in effect
the Exchange would still be able to
request the Annual Reports or any
information contained therein from any
Member pursuant to Exchange Rule 4.2,
which requires a Member to furnish to
the Exchange, upon request, current
copies of any financial information filed
with the Commission, which includes
the Annual Reports and any information
contained therein.11 As such, the
Exchange believes that the proposed
7 See Exchange Act Release No. 70073 (August 21,
2013), 78 FR 51909 (August 21, 2013).
8 See id. at 51923–24.
9 See id. See also Exchange Act Release No. 64676
(June 15, 2011), 76 FR 37572, 37592 (June 27, 2011).
10 See Exchange Rule 2.3, which sets forth certain
Member eligibility criteria and generally requires
that a prospective Member be and remain a member
of a national securities association registered under
Section 15A(a) of the Act or a member of another
national securities exchange registered under
Section 6(a) of the Act in order to be eligible to be,
and to remain, a Member. As such, the Exchange
believes that each Member will already have an
assigned DEA prior to joining the Exchange as a
Member.
11 See Exchange Rule 4.2.
VerDate Sep<11>2014
18:53 Feb 04, 2021
Jkt 253001
waiver would benefit Members for
which it is not the DEA by eliminating
an unnecessary requirement and
facilitating a more efficient exchange of
information between the Exchange and
such Members in that they would only
be required to furnish their Annual
Reports or any information contained
therein if and when the Exchange deems
it necessary and requests such
information. Therefore, the Exchange
proposes the addition of proposed
Interpretation and Policy .03 to
Exchange Rule 4.2 in order to explicitly
waive the requirement of SEC Rule 17a–
5(d)(6) for such Members to file copies
of their Annual Reports with the
Exchange. The Exchange notes,
however, that if and to the extent the
Exchange is the DEA for any of its
Members the Exchange’s Rules would
still require each such Member to
provide it with copies of such Member’s
Annual Reports in accordance with the
requirements of SEC Rule 17a–5(d)(6).
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,12 in general, and
furthers the objectives of Section 6(b)(5)
of the Act,13 in particular, in that it is
designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to foster cooperation and
coordination with persons engaged in
regulating, clearing, settling, processing
information with respect to, and
facilitating transactions in securities, 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.
The Exchange believes that it will be
able to properly regulate Members for
which it is not the DEA even without
the information contained in the Annual
Reports currently required to be
provided to the Exchange by such
Members under SEC Rule 17a–5(d)(6).
Firstly, the Exchange is not currently
the DEA for any of its Members and
does not currently use the information
contained in its Members’ Annual
Reports for any purpose. Additionally, if
the Exchange was to determine that the
information contained in the Annual
Reports of a Member for which it is not
the DEA was necessary for any reason,
the Exchange can directly request those
records from the Member pursuant to
Exchange Rule 4.2, which requires a
Member to furnish to the Exchange
current copies of any financial
12 15
13 15
PO 00000
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
Frm 00118
Fmt 4703
information filed with the Commission,
which includes the Annual Reports and
any information contained therein.14 In
this way, the Exchange could still obtain
the information contained in the Annual
Reports currently required to be
provided by such Members under SEC
Rule 17a–5(d)(6) even with the
proposed waiver of such requirement.
Given that Members must furnish the
Exchange with Annual Reports or the
information contained therein if and
when the Exchange so requests, the
Exchange does not believe that it is
necessary for it to separately receive
copies of Annual Reports from its
Members for which it is not the DEA
pursuant to SEC Rule 17a–5(d)(6).
Finally, the proposed Interpretation and
Policy .03 of Rule 4.2 is consistent with
the Act in that it is adopting a waiver
explicitly provided for by the
Commission in SEC Rule 17a–5(d)(6).
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange believes that the
proposed rule change would not impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. To the
contrary, the proposed Interpretation
and Policy .03 is not a competitive
proposal as it is concerned solely with
the administration of the Exchange and
simply creates a more efficient exchange
of information between the Exchange
and its Members. The Exchange notes
that the proposed Interpretation and
Policy .03 would apply equally to all
Members for which the Exchange is not
the DEA, which currently includes all of
the Exchange’s Members. The Exchange
notes that it still believes it is
appropriate to require provision of the
Annual Reports by any Member for
which it is the DEA pursuant to SEC
Rule 17a–5(d)(6) as the Exchange
believes the information contained in
the Annual Reports is important for an
SRO that is a broker-dealer’s DEA.
Furthermore, the Exchange notes that
the proposed Interpretation and Policy
.03 would be directly implementing a
permitted waiver adopted by the
Commission in SEC Rule 17a–5(d)(6),
and as such, any SRO can adopt such a
waiver to the extent permitted by that
rule. Consequently, the Exchange does
not believe that the proposed rule
change would impose any burden on
intermarket or intramarket competition.
14 See
Sfmt 4703
E:\FR\FM\05FEN1.SGM
Exchange Rule 4.2.
05FEN1
Federal Register / Vol. 86, No. 23 / Friday, February 5, 2021 / Notices
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange neither solicited nor
received comments on the proposed
rule change.
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 15 and Rule 19b–
4(f)(6) thereunder.16
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
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:
jbell on DSKJLSW7X2PROD 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–
MEMX–2021–01 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–MEMX–2021–01. 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–MEMX–2021–01, and
should be submitted on or before
February 26, 2021.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.17
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021–02395 Filed 2–4–21; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–91033; File No. SR–
EMERALD–2021–03]
Self-Regulatory Organizations; MIAX
Emerald, LLC; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Amend Its Fee
Schedule To Adopt Monthly Trading
Permit Fees
February 1, 2021.
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 January
22, 2021, MIAX Emerald, LLC (‘‘MIAX
Emerald’’ or ‘‘Exchange’’), filed with the
Securities and Exchange Commission
(‘‘Commission’’) a proposed rule change
as described in Items I, II, and III below,
17 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
15 15
U.S.C. 78s(b)(3)(A).
16 17 CFR 240.19b–4(f)(6).
VerDate Sep<11>2014
18:53 Feb 04, 2021
1 15
Jkt 253001
PO 00000
Frm 00119
Fmt 4703
Sfmt 4703
8455
which Items have been prepared by the
Exchange. 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 is filing a proposal to
amend the MIAX Emerald Fee Schedule
(the ‘‘Fee Schedule’’) to establish
monthly Trading Permit 3 fees for
Exchange Members.4
The text of the proposed rule change
is available on the Exchange’s website at
https://www.miaxoptions.com/rulefilings/emerald, at MIAX’s principal
office, 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
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 to adopt monthly Trading
Permit fees (the ‘‘Proposed Access
Fees’’) depending on the Member’s
status as either an Electronic Exchange
Member (‘‘EEM’’) 5 or as a Market
Maker.6 MIAX Emerald commenced
3 The term ‘‘Trading Permit’’ means a permit
issued by the Exchange that confers the ability to
transact on the Exchange. See Exchange Rule 100.
4 The term ‘‘Member’’ means an individual or
organization approved to exercise the trading rights
associated with a Trading Permit. Members are
deemed ‘‘members’’ under the Exchange Act. See
Exchange Rule 100 and the Definitions Section of
the Fee Schedule.
5 ‘‘Electronic Exchange Member’’ or ‘‘EEM’’
means the holder of a Trading Permit who is not
a Market Maker. Electronic Exchange Members are
deemed ‘‘members’’ under the Exchange Act. See
Exchange Rule 100 and the Definitions Section of
the Fee Schedule.
6 The term ‘‘Market Makers’’ refers to ‘‘Lead
Market Makers’’, ‘‘Primary Lead Market Makers’’
and ‘‘Registered Market Makers’’ collectively. See
Exchange Rule 100 and the Definitions Section of
the Fee Schedule.
E:\FR\FM\05FEN1.SGM
05FEN1
]]>Agencies
[Federal Register Volume 86, Number 23 (Friday, February 5, 2021)]
[Notices]
[Pages 8453-8455]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-02395]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-91027; File No. SR-MEMX-2021-01]
Self-Regulatory Organizations; MEMX LLC; Notice of Filing and
Immediate Effectiveness of a Proposed Rule Change To Add Interpretation
and Policy .03 to Exchange Rule 4.2 Regarding the Provision of Members'
Broker-Dealer Annual Reports
February 1, 2021.
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 January 21, 2021, MEMX LLC (``MEMX'' 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 Exchange. The Exchange filed the
proposal as a ``non-controversial'' proposed rule change pursuant to
Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-4(f)(6)
thereunder.\4\ 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)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is filing with the Commission a proposed rule change
to add proposed Interpretation and Policy .03 to Exchange Rule 4.2 that
would provide a waiver of the requirement that members of the Exchange
(``Members'') for which the Exchange is not the designated examining
authority (``DEA'') provide the Exchange with copies of their broker-
dealer annual reports. The text of the proposed rule change is provided
in Exhibit 5.
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
SEC Rule 17a-5(d) \5\ generally requires each broker-dealer
registered under Section 15 of the Act to file with the Commission and
the broker-dealer's DEA certain financial-related reports described in
that rule on an annual basis (such reports, ``Annual Reports''). SEC
Rule 17a-5(d)(6) \6\ further requires each broker-dealer to provide all
self-regulatory organizations (``SROs'') of which the broker-dealer is
a member with copies of its Annual Reports. The Exchange proposes to
add proposed
[[Page 8454]]
Interpretation and Policy .03 to Exchange Rule 4.2 to relieve Members
for which the Exchange is not the DEA of the requirement of SEC Rule
17a-5(d)(6) that a broker-dealer must provide copies of its Annual
Reports to the Exchange.
---------------------------------------------------------------------------
\5\ 17 CFR 240.17a-5(d).
\6\ 17 CFR 240.17a-5(d)(6).
---------------------------------------------------------------------------
In 2013 the Commission amended certain broker-dealer annual
reporting, audit, and notification requirements.\7\ Among these
amendments was an amendment to paragraph (d)(6) of Rule 17a-5 to allow
an SRO that is not a broker-dealer's DEA to waive by rule the
requirement that such broker-dealer provide its Annual Reports to that
SRO.\8\ This amendment was proposed because in some cases SROs do not
believe it is necessary to receive copies of a broker-dealer's Annual
Reports, particularly when an SRO is not the broker-dealer's DEA.\9\
---------------------------------------------------------------------------
\7\ See Exchange Act Release No. 70073 (August 21, 2013), 78 FR
51909 (August 21, 2013).
\8\ See id. at 51923-24.
\9\ See id. See also Exchange Act Release No. 64676 (June 15,
2011), 76 FR 37572, 37592 (June 27, 2011).
---------------------------------------------------------------------------
The Exchange is not currently the DEA for any of its Members and
does not expect to be the DEA for any of its Members.\10\ The Exchange
does not believe it is necessary for it to receive copies of Annual
Reports from its Members for which it is not the DEA, as the Exchange
does not anticipate using any information contained therein in order to
carry out its regulatory responsibilities. The Exchange believes that
receiving such information is important for an SRO that is a broker-
dealer's DEA but not for an SRO that is not the broker-dealer's DEA,
particularly as one of the key responsibilities of a broker-dealer's
DEA is to oversee such broker-dealer's compliance with applicable
financial responsibility rules. Furthermore, the Exchange notes that
even with the proposed waiver in effect the Exchange would still be
able to request the Annual Reports or any information contained therein
from any Member pursuant to Exchange Rule 4.2, which requires a Member
to furnish to the Exchange, upon request, current copies of any
financial information filed with the Commission, which includes the
Annual Reports and any information contained therein.\11\ As such, the
Exchange believes that the proposed waiver would benefit Members for
which it is not the DEA by eliminating an unnecessary requirement and
facilitating a more efficient exchange of information between the
Exchange and such Members in that they would only be required to
furnish their Annual Reports or any information contained therein if
and when the Exchange deems it necessary and requests such information.
Therefore, the Exchange proposes the addition of proposed
Interpretation and Policy .03 to Exchange Rule 4.2 in order to
explicitly waive the requirement of SEC Rule 17a-5(d)(6) for such
Members to file copies of their Annual Reports with the Exchange. The
Exchange notes, however, that if and to the extent the Exchange is the
DEA for any of its Members the Exchange's Rules would still require
each such Member to provide it with copies of such Member's Annual
Reports in accordance with the requirements of SEC Rule 17a-5(d)(6).
---------------------------------------------------------------------------
\10\ See Exchange Rule 2.3, which sets forth certain Member
eligibility criteria and generally requires that a prospective
Member be and remain a member of a national securities association
registered under Section 15A(a) of the Act or a member of another
national securities exchange registered under Section 6(a) of the
Act in order to be eligible to be, and to remain, a Member. As such,
the Exchange believes that each Member will already have an assigned
DEA prior to joining the Exchange as a Member.
\11\ See Exchange Rule 4.2.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\12\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\13\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, 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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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that it will be able to properly regulate
Members for which it is not the DEA even without the information
contained in the Annual Reports currently required to be provided to
the Exchange by such Members under SEC Rule 17a-5(d)(6). Firstly, the
Exchange is not currently the DEA for any of its Members and does not
currently use the information contained in its Members' Annual Reports
for any purpose. Additionally, if the Exchange was to determine that
the information contained in the Annual Reports of a Member for which
it is not the DEA was necessary for any reason, the Exchange can
directly request those records from the Member pursuant to Exchange
Rule 4.2, which requires a Member to furnish to the Exchange current
copies of any financial information filed with the Commission, which
includes the Annual Reports and any information contained therein.\14\
In this way, the Exchange could still obtain the information contained
in the Annual Reports currently required to be provided by such Members
under SEC Rule 17a-5(d)(6) even with the proposed waiver of such
requirement.
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\14\ See Exchange Rule 4.2.
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Given that Members must furnish the Exchange with Annual Reports or
the information contained therein if and when the Exchange so requests,
the Exchange does not believe that it is necessary for it to separately
receive copies of Annual Reports from its Members for which it is not
the DEA pursuant to SEC Rule 17a-5(d)(6). Finally, the proposed
Interpretation and Policy .03 of Rule 4.2 is consistent with the Act in
that it is adopting a waiver explicitly provided for by the Commission
in SEC Rule 17a-5(d)(6).
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange believes that the proposed rule change would not
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. To the contrary, the
proposed Interpretation and Policy .03 is not a competitive proposal as
it is concerned solely with the administration of the Exchange and
simply creates a more efficient exchange of information between the
Exchange and its Members. The Exchange notes that the proposed
Interpretation and Policy .03 would apply equally to all Members for
which the Exchange is not the DEA, which currently includes all of the
Exchange's Members. The Exchange notes that it still believes it is
appropriate to require provision of the Annual Reports by any Member
for which it is the DEA pursuant to SEC Rule 17a-5(d)(6) as the
Exchange believes the information contained in the Annual Reports is
important for an SRO that is a broker-dealer's DEA. Furthermore, the
Exchange notes that the proposed Interpretation and Policy .03 would be
directly implementing a permitted waiver adopted by the Commission in
SEC Rule 17a-5(d)(6), and as such, any SRO can adopt such a waiver to
the extent permitted by that rule. Consequently, the Exchange does not
believe that the proposed rule change would impose any burden on
intermarket or intramarket competition.
[[Page 8455]]
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange neither solicited nor received comments on the
proposed rule change.
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 \15\ and Rule 19b-
4(f)(6) thereunder.\16\
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\15\ 15 U.S.C. 78s(b)(3)(A).
\16\ 17 CFR 240.19b-4(f)(6).
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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 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 [email protected]. Please include
File Number SR-MEMX-2021-01 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-MEMX-2021-01. 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-MEMX-2021-01, and should be submitted on
or before February 26, 2021.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
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\17\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-02395 Filed 2-4-21; 8:45 am]
BILLING CODE 8011-01-P
