Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Options 4 Listing Rules, 42945-42956 [2021-16677]

Agencies

• SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 86, Number 148 (Thursday, August 5, 2021)]
[Notices]
[Pages 42945-42956]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-16677]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-92535; File No. SR-BX-2021-032]


Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the 
Options 4 Listing Rules

July 30, 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 July 20, 2021, Nasdaq BX, Inc. (``BX'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``SEC'' or ``Commission'') the 
proposed rule change as described in Items I, and II, below, 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend BX's Rules at Options 2, Section 5, 
Market Maker Quotations; Options 4, Options Listing Rules; and Options 
4A, Section 12, Terms of Index Options Contracts. This proposal also 
reserves Options 4C. Finally, the Exchange proposes to reserve some 
sections with the Equity Rules.
    The text of the proposed rule change is available on the Exchange's 
website at https://listingcenter.nasdaq.com/rulebook/bx/rules, 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 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 Options 4, Options Listing 
Rules, to conform BX's Options 4 Listing Rules to Nasdaq ISE, LLC's 
(``ISE'') Options 4 Listing Rules. The Exchange also proposes to amend 
BX Options 4A, Section 12, Terms of Index Options Contracts and reserve 
BX Options 4C. Finally, the Exchange also proposes to amend Options 2, 
Section 5, Market Maker Quotations to relocate rule text concerning 
bid/ask differentials for long-term options contracts from BX Options 4 
and Options 4A, similar to ISE.
    The Exchange also proposes a technical amendment to General 9, 
Section 51, Research Analysts and remove stray periods through Options 
4. Each rule change is described below.
Options 4, Options Listing Rules
    Conforming BX's Options 4 Listing Rules to that of ISE Options 4 is 
part of the Exchange's continued effort to promote efficiency in the 
manner in which it administers its rules. The Exchange proposes to 
amend these rules to conform to ISE Options 4 Rules.
Section 1. Designation of Securities
    The Exchange proposes to replace the current rule text of Options 
4, Section 1 which states,

    Securities traded on the Exchange are options contracts, each of 
which is designated by reference to the issuer of the underlying 
security or name of underlying foreign currency, expiration month or 
expiration date, exercise price and type (put or call).

with the following rule text,

    The Exchange trades options contracts, each of which is designated 
by reference to the issuer of the underlying security, expiration month 
or expiration date, exercise price and type (put or call).

    The Exchange proposes to amend this sentence within Options 4, 
Section 1 to conform to ISE Options 4, Section 1. The revised wording 
does not substantively amend the paragraph.
Section 2. Rights and Obligations of Holders and Writers
    The Exchange proposes to replace the current rule text of Options 
4, Section 1 which states,

    Subject to the provisions of this Chapter, the rights and 
obligations of holders and writers of option contracts of any class of 
options dealt in on the Exchange shall be as set forth in the Rules of 
the Clearing Corporation.

with the following rule text,

    The rights and obligations of holders and writers shall be as set 
forth in the Rules of the Clearing Corporation.

    The Exchange proposes to amend this sentence within Options 4, 
Section 2 to conform to ISE Options 4, Section 1. The revised wording 
does not substantively amend the paragraph.
Section 3. Criteria for Underlying Securities
    Options 4, Section 3 of the Options Listing Rules is being updated 
to conform to ISE Options 4, Section 3.
    The Exchange proposes to amend Options 4, Section 3(a)(i) and (ii) 
to conform to ISE Options 4, Section 3(a)(1) and (2) by changing the 
``i. and ii.'' to ``(1) and (2),'' respectively. Also, the Exchange 
proposes to remove the phrase ``with the SEC'' within current BX 
Options 4, Section 3(a)(i). These amendments are non-substantive.
    The Exchange proposes to amend Options 4, Section 3(b) to reword 
the rule text to ISE Options 4, Section 3(b). The Exchange proposes to 
replace the current rule text of Options 4, Section 3(b) which states,

    In addition, the Exchange shall from time to time establish 
standards to be considered in evaluating potential underlying 
securities for the Exchange options transactions. There are many 
relevant factors which must be considered in arriving at such a 
determination, and the fact that a particular security may meet the 
standards established by the Exchange does not necessarily mean that it 
will be selected as an underlying security. The Exchange may give 
consideration to maintaining diversity among various industries and 
issuers in selecting underlying securities. Notwithstanding the 
foregoing, an underlying security will not be selected unless:


[[Page 42946]]


with the following rule text,

    In addition, the Exchange shall from time to time establish 
guidelines to be considered in evaluating potential underlying 
securities for Exchange options transactions. There are many relevant 
factors which must be considered in arriving at such a determination, 
and the fact that a particular security may meet the guidelines 
established by the Exchange does not necessarily mean that it will be 
selected as an underlying security. Further, in exceptional 
circumstances an underlying security may be selected by the Exchange 
even though it does not meet all of the guidelines. The Exchange may 
also give consideration to maintaining diversity among various 
industries and issuers in selecting underlying securities. 
Notwithstanding the foregoing, however absent exceptional 
circumstances, an underlying security will not be selected unless:

    The new rule text permits the Exchange, in exceptional 
circumstances, to select an underlying security even though it does not 
meet all of the guidelines. Today, the Exchange may establish 
guidelines to be considered in evaluating potential underlying 
securities for Exchange options transactions. Providing BX with the 
same ability to select an underlying security even though it does not 
meet all of the guidelines as ISE will permit BX to list similar 
options as ISE for competitive purposes. The proposal to replace the 
term ``standards'' with ``guidelines'' within paragraph 3(b) is non-
substantive.
    The Exchange is amending numbering within Options 4, Section 3(b) 
as well as removing extraneous rule text within current Options 4, 
Section 3(b)(iii), namely ``or Rules thereunder.'' The Exchange 
proposes to relocate Options 4, Section 3(k) into new Options 4, 
Section 3(b)(6) without change. This would align BX Options 4, Section 
3(b)(6) with ISE Options 4, Section 3(b)(6). This provision states,

    Notwithstanding the requirements set forth in Paragraphs 1, 2, 4 
and 5 above, the Exchange may list and trade an options contract if (i) 
the underlying security meets the guidelines for continued approval in 
Options 4, Section 4; and (ii) options on such underlying security are 
traded on at least one other registered national securities exchange.

    The Exchange proposes to renumber BX Options 4, Section 3(c) and 
make minor amendments to rule text within current Options 4, Section 
3(c)(ii), (iii), (iv) and (v), Sections 3(d), 3(f) and 3(g) to conform 
the rule text to ISE Options 4, Section 3(c)(ii), (iii), (iv) and (v), 
Sections 3(d), 3(f) and 3(g). The proposed changes are non-
substantive.\3\
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    \3\ The proposed changes replace the word ``standards'' with 
``guidelines,'' insert ``Options 4'' before ``Section 3,'' and 
remove 2 extraneous uses of ``this.'' Similar replacements are made 
throughout current Options 4, Section 3(c), including amending a 
capitalized ``Paragraph.''
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    The Exchange proposes to amend an ``up'' to ``on'' within BX 
Options 4, Section 3(d). This proposed change is non-substantive.
    The Exchange proposes non-substantive amendments to amend BX 
Options 4, Section 3(f) and (g) \4\ in addition to conforming the 
numbering to ISE Options 4, Section 3(f) and (g).
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    \4\ The proposed changes replace the word ``standards'' with 
``guidelines,'' insert ``Rule'' instead of ``Section 3,'' and remove 
an unnecessary ``or.''
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    The Exchange proposes to relocate current BX Options 4, Section 
3(h) describing a market information sharing agreement to proposed BX 
Options 4, Section 3(i). This text is currently located within ISE 
rules at Options 4, Section 3(i).
    Current BX Options 4, Section 3(i) is being re-lettered as proposed 
Options 4, Section 3(h). The Exchange proposes to add the defined term 
``Financial Instruments'' within Options 4, Section 3(h) and also 
account for money market instruments, U.S. government securities and 
repurchase agreements, defined by the term ``Money Market Instruments'' 
similar to ISE Options 4, Section 3(h). The addition of money market 
instruments, U.S. government securities and repurchase agreements as 
securities deemed appropriate for options trading will make clear that 
these agreements are included in the acceptable securities. The 
Exchange notes that this rule text is clarifying in nature and will 
more explicitly provide for money market instruments, U.S. government 
securities and repurchase agreements as a separate category from what 
is being defined as ``Financial Instruments'' with this proposal. 
Today, these instruments are eligible as securities deemed appropriate 
for options trading. The remainder of the changes are non-substantive 
in nature and simply conform the location of words similar to ISE.\5\ 
The Exchange also proposes to remove the following products from 
Options 4, Section 3(h): The ETFS Silver Trust, the ETFS Palladium 
Trust, the ETFS Platinum Trust or the Sprott Physical Gold Trust. The 
Exchange no longer lists these products and proposes to remove them the 
products from its listing rules. The Exchange will file a proposal with 
the Commission if it determines to list these products in the future.
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    \5\ The amendment to current Options 4, Section 3(i)(B)(4) to 
add, ``. . . which the Exchange-Traded Fund shares are based . . .'' 
makes clear that this text applies to Exchange-Traded Fund shares. 
Also the word ``indexes'' is being changes to ``indices'' within 
this paragraph and ``similar entity'' is being relocated within the 
paragraph.
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    The Exchange will file a proposal with the Commission if it 
determines to list these products in the future. Finally, the Exchange 
proposes to amend Options 4, Section 3(h) by removing the rule text at 
the end of the paragraph which provides, ``all of the following 
conditions are met.'' Paragraph (h) would simply end with ``provided 
that:'' and direct market participants to subparagraphs (1) and (2).
    The Exchange proposes to capitalize ``the'' at the beginning of 
Options 4, Section 3(h)(1) and remove ``; and'' at the end of the 
paragraph and instead at a period so that subparagraphs (1) and (2) are 
not linked, but rather read independently. Today, Options 4, Section 
3(h)(1) applies to all Exchange-Traded Fund Shares. Similar to ISE 
Options 4, Section 3(h)(2), the Exchange proposes to clarify that 
Options 4, Section 3(h)(2) applies to only international or global 
Exchange-Traded Fund Shares. Specifically, the Exchange proposes to 
amend Options 4, Section 3(h)(2) to provide, ``Exchange-Traded Fund 
Shares based on international or global indexes, or portfolios that 
include non-U.S. securities, shall meet the following criteria.'' ISE 
Options 4, Section 3(h) has the identical text. Proposed Options 4, 
Sections 3(h) generally concerns securities deemed appropriate for 
options trading. The proposed new rule text adds language stating that 
subparagraph (h)(2) of Options 4, Section 3 applies to the extent the 
Exchange-Traded Fund Share is based on international or global indexes, 
or portfolios that include non-U.S. securities. This language is 
intended to serve as a guidepost and clarify that (1) subparagraph 
(h)(2) does not apply to an Exchange-Traded Fund Shares based on a U.S. 
domestic index or portfolio, and (2) subparagraph (h)(2) includes 
Exchange-Traded Fund Shares that track a portfolio and do not track an 
index.
    The Exchange proposes to amend Options 4, Section 3(h)(2)(A) to 
remove the phrase ``for series of portfolio depositary receipts and 
index fund shares based on international or global indexes,''. Today, 
Options 4, Section

[[Page 42947]]

3(h), subparagraphs (h)(1) \6\ and (h)(v) \7\ permit the Exchange to 
list options on Exchange-Traded Fund Shares based on generic listing 
standards for portfolio depositary receipts and index fund shares 
without applying component based requirements in subparagraphs 
(h)(2)(B)-(D). By removing the proposed rule text, the Exchange would 
make clear that subparagraph (h)(2)(A) applies to Exchange-Traded Fund 
Shares based on international or global indexes, or portfolios that 
include non-U.S. securities, that are listed pursuant to generic 
listing standards and comply with Options 4, Section 3(h) and 
subparagraph (h)(1). The identical rule text exists within ISE Options 
4, Section 3(h)(2)(A).
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    \6\ Subsection (h)(i) concerns passive Exchange-Traded Fund 
Shares. Subsection (h)(1) provides, ``represent interests in 
registered investment companies (or series thereof) organized as 
open-end management investment companies, unit investment trusts or 
similar entities that hold portfolios of securities and/or financial 
instruments, including, but not limited to, stock index futures 
contracts, options on futures, options on securities and indices, 
equity caps, collars and floors, swap agreements, forward contracts, 
repurchase agreements and reverse repurchase agreements (the 
``Financial Instruments''), and money market instruments, including, 
but not limited to, U.S. government securities and repurchase 
agreements (the ``Money Market Instruments'') comprising or 
otherwise based on or representing investments in broad-based 
indexes or portfolios of securities and/or Financial Instruments and 
Money Market Instruments (or that hold securities in one or more 
other registered investment companies that themselves hold such 
portfolios of securities and/or Financial Instruments and Money 
Market Instruments).''
    \7\ Subsection (h)(v) concerns active Exchange-Traded Fund 
Shares. Subsection (h)(v) Provides, ``represents an interest in a 
registered investment company (``Investment Company'') organized as 
an open-end management company or similar entity, that invests in a 
portfolio of securities selected by the Investment Company's 
investment adviser consistent with the Investment Company's 
investment objectives and policies, which is issued in a specified 
aggregate minimum number in return for a deposit of a specified 
portfolio of securities and/or a cash amount with a value equal to 
the next determined net asset value (``NAV''), and when aggregated 
in the same specified minimum number, may be redeemed at a holder's 
request, which holder will be paid a specified portfolio of 
securities and/or cash with a value equal to the next determined NAV 
(``Managed Fund Share'').
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    The Exchange also proposes to amend the term ``comprehensive 
surveillance agreement'' within Options 4, Section 3(h)(2) (A)-(D) to 
instead provide ``comprehensive surveillance sharing agreement.'' This 
amendment will bring greater clarity to the term. Further, the Exchange 
proposes to add the phrase ``if not available or applicable, the 
Exchange-Traded Fund's'' within Options 4, Section 3(h)(2)(B), (C), and 
(D) to clarify that when component securities are not available, the 
portfolio of securities upon which the Exchange-Traded Fund Share is 
based can be used instead. The Exchange notes that ``not available'' is 
intended for cases where the Exchange does not have access to the index 
components, in those cases the Exchange would look to the portfolio 
components. The term ``not applicable'' is intended if the fund is 
active and does not track an index and only the portfolio is available. 
These amendments will conform the rule text to ISE Options 4, Section 
3(h)(2)(A)-(D).
    The Exchange also proposes to wordsmith Options 4, Section 
3(h)(2)(B) to amend the phrase to provide, ``any non-U.S. component 
securities of an index on which the Exchange-Traded Fund Shares are 
based or if not available or applicable, the Exchange-Traded Fund's 
portfolio of securities that are not subject to comprehensive 
surveillance sharing agreements do not in the aggregate represent more 
than 50% of the weight of the index or portfolio;''. Finally, the 
Exchange proposes to wordsmith Options 4, Section 3(h)(2)(C) and (D) to 
relocate the phrase ``on which the Exchange-Traded Fund Shares are 
based'' and add ``or portfolio'' to bring greater clarity to the rule 
text by conforming the rule text of (C) and (D) to the language within 
(B). The Exchange believes that the revised wording will bring greater 
clarity to the rule text and conform the rule text to ISE Options 4, 
Section 3(h)(2)(B)-(D). The Exchange proposes a non-substantive 
technical amendment to Options 4, Section 3(C)(2)(A)(ii) to correct a 
typographical error by changing a ``than'' to a ``that.'' The Exchange 
proposes a non-substantive technical amendment to Options 4, Section 
3(h)(1) to change ``In'' to ``in.''
    As noted above BX Options 4, Section 3(h), which describes a market 
information sharing agreement, was relocated to proposed Options 4, 
Section 3(i), similar to ISE Options 4, Section 3(i).
    The Exchange proposes to amend Options 4, Section 3(j) to conform 
the rule text to ISE Options 4, Section 3(j). The proposed changes are 
non-substantive.\8\
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    \8\ The amendment to current Options 4, Section 3(j) replace the 
word ``standards'' with ``guidelines.''
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    As noted, above, Options 4, Section 3(k) was relocated to new 
Options 4, Section 3(b)(6).
    The Exchange proposes to remove the header ``Index-Linked 
Securities'' within Options 4, Section 3(l), and re-letter Options 4, 
Section 3(l)(i) as Section 3(k). Proposed Options 4, Section 3(k) has 
non-substantive numbering and citation amendments.
    Options 4, Section 3(m) is being removed as BX does not list U.S. 
Dollar-Settled Foreign Currency Options.
Section 4. Withdrawal of Approval of Underlying Securities
    The Exchange proposes to remove the first sentence of Options 4, 
Section 4(a), which provides, ``If put or call options contracts with 
respect to an underlying security are approved for listing and trading 
on the Exchange, such approval shall continue in effect until such 
approval is affirmatively withdrawn by the Exchange.'' This sentence is 
unnecessary as the second sentence within Options 4, Section 4(a) makes 
clear that approval continues until it does not meet the requirements. 
Also, the Exchange proposes to add the following text to the end of 
this paragraph: ``When all options contracts with respect to any 
underlying security that is no longer approved have expired, the 
Exchange may make application to the SEC to strike from trading and 
listing all such options contracts.'' This text makes clear that 
options contracts that are no longer approved will not be listed. The 
remainder of the changes to Options 4, Section 4(a) are non-
substantive. This proposal is intended to conform BX's Options 4, 
Section 4(a) with ISE Options 4, Section 4(a).
    The Exchange proposes to amend Options 4, Section 4(b) to add 
``Absent exceptional circumstances . . .'' at the beginning of the 
section. This phrase adds clarity to the rule text. The remainder of 
the numbering changes as well as capitalization are non-substantive and 
intended to conform BX's Options 4, Section 4(b) with ISE Options 4, 
Section 4(b). The Exchange also proposes to remove reserved sections.
    Options 4, Section 4(c), which is currently reserved, is proposed 
to be deleted and current Options 4, Section 4(d) is proposed to be re-
lettered as ``c''. Minor non-substantive conforming changes are 
proposed to current Options 4, Section 4(d)-(f).\9\
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    \9\ The Exchange proposes to remove ``Section 4'', lowercase the 
term ``Customer,'' add ``options 4'' and remove ``thereof'' within 
Options 4, Section 4(d)-(f).
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    The Exchange proposes to amend current Options 4, Section 4(h) to 
re-letter it ``g'' and replace ``security'' with ``Exchange-Traded Fund 
Shares'' similar to ISE Options 4, Section 4(g). The Exchange proposes 
to add halt or suspension as other circumstances in which the Exchange 
shall not open for trading any additional series of option contracts of 
the class to clarify that this scenario may also exist. The other

[[Page 42948]]

proposed changes to current Options 4, Section 4(h) are non-
substantive.\10\
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    \10\ The Exchange proposes to amend Options 4, Section 4(h) to 
add ``Options 4'' and replace ``Section 4'' with ``Rule;'' and 
replace an ``or'' with an ``and.''
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    The Exchange proposes to amend current Options 4, Section 4(i) to 
re-letter it ``h'' and add ``Absent exceptional circumstances, 
securities . . .'' at the beginning of the section. This phrase adds 
clarity to the rule text. The remainder of the numbering changes are 
non-substantive \11\ and conform current BX's Options 4, Section 4(i) 
with ISE Options 4, Section 4(h).
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    \11\ The term Options 4 is being relocated within the proposed 
new paragraph (h). Also, the term ``Rule'' is being used within 
proposed new paragraph (h)(1) instead of ``Section 4,'' and 
``Section 3.'' ``Upon annual review'' is being removed from proposed 
new paragraph (h)(2).
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    The Exchange proposes to adopt new Options 4, Section 4(i) similar 
to ISE, Options 4, Section 4(i). The proposed new section would 
provide,

    For Holding Company Depositary Receipts (HOLDRs), the Exchange will 
not open additional series of options overlying HOLDRs (without prior 
Commission approval) if:
    (1) The proportion of securities underlying standardized equity 
options to all securities held in a HOLDRs trust is less than 80% (as 
measured by their relative weightings in the HOLDRs trust); or
    (2) less than 80% of the total number of securities held in a 
HOLDRs trust underlie standardized equity options.

    Current Options 4, Section 4 does not describe the withdrawal of 
HOLDRs. This new text, similar to ISE, would provide for provisions 
wherein the Exchange will not open additional series of options 
overlying HOLDRs.
    The Exchange proposes to delete current Options 4, Section 4(j), 
which is reserved, as well as the lettering for Options 4, Section 4(k) 
which states, ``Index Linked Securities.'' The next existing paragraph 
is proposed to be Options 4, Section 4(j). The remainder of the 
numbering changes to this section are non-substantive and conform 
proposed Options 4, Section 4(j) with ISE Options 4, Section 4(j).
    The Exchange proposes to remove Options 4, Section 4(l) related to 
inadequate volume delisting. To remain competitive with other options 
markets, the Exchange proposes to adopt the same obligations for 
continuance of trading.\12\ Also, pursuant to proposed new Options 4, 
Section 5(e) the Exchange will announce securities that have been 
withdrawn. With this proposal, the Exchange would eliminate the 
requirement that an option must be trading for more than 6 months. The 
Exchange notes that this condition is not present on other options 
markets such as ISE and Cboe Exchange, Inc. (``Cboe'').\13\ This also 
applies to the requirement that the average daily volume of the entire 
class of options over the last six (6) month period was less than 
twenty (20) contracts. The Exchange notes that BX's requirements are 
different than other options markets. To remain competitive the 
Exchange proposes to adopt the same standards as ISE and Cboe to remain 
competitive in order that it may list options similar to other markets.
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    \12\ Options 4, Section 4(b), as amended, establishes 
requirements for continued listing, similar to ISE. See proposed 
Phlx Options 3, Section 4(b) which provides, ``Absent exceptional 
circumstances, an underlying security will not be deemed to meet the 
Exchange's requirements for continued approval whenever any of the 
following occur: (1) There are fewer than 6,300,000 shares of the 
underlying security held by persons other than those who are 
required to report their security holdings under Section 16(a) of 
the Exchange Act. (2) There are fewer than 1,600 holders of the 
underlying security. (3) The trading volume (in all markets in which 
the underlying security is traded) has been less than 1,800,000 
shares in the preceding twelve (12) months. (4) The underlying 
security ceases to be an ``NMS stock'' as defined in Rule 600 of 
Regulation NMS under the Exchange Act. (5) If an underlying security 
is approved for options listing and trading under the provisions of 
Options 4, Section 3(c), the trading volume of the Original Security 
(as therein defined) prior to but not after the commencement of 
trading in the Restructure Security (as therein defined), including 
``when-issued'' trading, may be taken into account in determining 
whether the trading volume requirement of (3) of this paragraph (b) 
is satisfied.''
    \13\ See ISE Options 4, Section 4 and Cboe Rule 4.4.
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    While the Exchange may in the future determine to delist an option 
that is singly listed, the Exchange proposes to remove the rule text 
which provides that ``If the option is singly listed only on the 
Exchange, the Exchange will cease to add new series and may delist the 
class of options when there is no remaining open interest.'' This rule 
text does not exist on ISE and Cboe. The Exchange today provides 
notification of a delisting to all Participants so therefore it is not 
necessary to retain the provisions within (b)(2). Also, proposed new 
Options 4, Section 4(e) establishes the rules by which the Exchange 
will announce securities that have been withdrawn. The rule text within 
Options 4, Section 4(b), as amended to conform to ISE rule text, will 
continue to govern the continued approval of options on the Exchange.
    The reference to Options 4, Section 4(m) is proposed to be deleted. 
The provision that is currently Options 4, Section 4(m) is proposed to 
become proposed Supplementary Material .01 to Options 4, Section 6 with 
a minor non-substantive change to the current rule text to capitalize 
``rules.''
Section 5. Series of Options Contracts Open for Trading
    The Exchange proposes to update citations within Options 4, Section 
5 to reflect the replacement of current rule text. These changes are 
non-substantive.
Section 7. Adjustments
    The Exchange proposes non-substantive amendments to Options 4, 
Section 7. The current text states,

    Options contracts shall be subject to adjustments in accordance 
with the Rules of the Clearing Corporation. The Exchange will announce 
adjustments, and such changes will be effective for all subsequent 
transactions in that series at the time specified in the announcement.

    The Exchange proposes to instead provide,

    Options contracts shall be subject to adjustments in accordance 
with the Rules of the Clearing Corporation. When adjustments have been 
made, the Exchange will announce that fact, and such changes will be 
effective for all subsequent transactions in that series at the time 
specified in the announcement.

    The proposal conforms BX Options 4, Section 7 with ISE Options 4, 
Section 7.
Section 8. Long-Term Options Contracts
    The Exchange proposes to conform the BX Options 4, Section 8 to ISE 
Options 4, Section 8. The proposed changes are non-substantive. BX's 
current rule text provides that with respect to long-term options 
series, bid/ask differential rules do not apply. The Exchange proposes 
to add this rule text to Options 4, Section 5(d)(2) within new ``A'' as 
the bid/ask differential requirements can be found within this rule. 
The Exchange also proposes to add a new sentence to Options 4, Section 
8(a) to refer to Options 4, Section 5(d)(2)(A), which states, ``Bid/ask 
differentials for long-term options contracts are specified within 
Options 3, Section 5(d)(2)(A)'' for ease of reference.
Section 9. Limitation on the Liability of Index Licensors for Options 
on Fund Shares
    The Exchange proposes to remove current Options 4, Section 9, U.S. 
Dollar-Settled Foreign Currency Option Closing Settlement Value as BX 
does not list U.S. Dollar-Settled Foreign Currency Options.
    The Exchange proposes to adopt a new Section 9, titled ``Limitation 
on the Liability of Index Licensors for Options on Fund Shares'' 
identical to ISE

[[Page 42949]]

Options 4, Section 9. ISE and Cboe have similar provisions.\14\ The new 
rule would provide,
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    \14\ See Securities Exchange Act Release No. 45817 (April 24, 
2002), 67 FR 21785 (May 1, 2002) (SR-CBOE-2002-19) (Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change by the Chicago 
Board Options Exchange, Incorporated To Amend Its Rules Relating to 
the Limitation of Liability for Index Licensors) and 14729 (March 
19, 2003), 68 FR 14729 (March 26, 2003) (SR-ISE-2003-09) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change by 
International Securities Exchange, Inc., Relating to Limiting the 
Liability of Index Licensors for Options on Fund Shares).

    (a) The term ``index licensor'' as used in this Rule refers to any 
entity that grants the Exchange a license to use one or more indexes or 
portfolios in connection with the trading of options on Exchange-Traded 
Fund Shares (as defined in Options 4, Section 3(h)).
    (b) No index licensor with respect to any index or portfolio 
underlying an option on Exchange-Traded Fund Shares traded on the 
Exchange makes any warranty, express or implied, as to the results to 
be obtained by any person or entity from the use of such index or 
portfolio, any opening, intra-day or closing value therefor, or any 
data included therein or relating thereto, in connection with the 
trading of any option contract on Exchange-Traded Fund Shares based 
thereon or for any other purpose. The index licensor shall obtain 
information for inclusion in, or for use in the calculation of, such 
index or portfolio from sources it believes to be reliable, but the 
index licensor does not guarantee the accuracy or completeness of such 
index or portfolio, any opening, intra-day or closing value therefor, 
or any data included therein or related thereto. The index licensor 
hereby disclaims all warranties of merchantability or fitness for a 
particular purpose or use with respect to any such index or portfolio, 
any opening, intra-day or closing value therefor, any data included 
therein or relating thereto, or any option contract on Exchange-Traded 
Fund Shares based thereon. The index licensor shall have no liability 
for any damages, claims, losses (including any indirect or 
consequential losses), expenses or delays, whether direct or indirect, 
foreseen or unforeseen, suffered by any person arising out of any 
circumstance or occurrence relating to the person's use of such index 
or portfolio, any opening, intra-day or closing value therefor, any 
data included therein or relating thereto, or any option contract on 
Exchange-Traded Fund Shares based thereon, or arising out of any errors 
or delays in calculating or disseminating such index or portfolio.
    Proposed Section 9(a) defines the term ``index licensor'' as any 
entity that grants the Exchange a license to use one or more indexes or 
portfolios in connection with the trading of options on Exchange-Traded 
Fund Shares (as defined in Options 4, Section 3(h)).
    Proposed Options 4, Section 9(b) provides that no index licensor 
with respect to any index or portfolio underlying an option on 
Exchange-Traded Fund Shares traded on the Exchange makes any warranty, 
express or implied, as to the results to be obtained by any person or 
entity from the use of such index or portfolio, any opening, intra-day 
or closing value therefor, or any data included therein or relating 
thereto, in connection with the trading of any option contract on 
Exchange-Traded Fund Shares based thereon or for any other purpose. The 
index licensor will obtain information for inclusion in, or for use in 
the calculation of, such index or portfolio from sources it believes to 
be reliable, but the index licensor does not guarantee the accuracy or 
completeness of such index or portfolio, any opening, intra-day or 
closing value therefor, or any data included therein or related 
thereto. The index licensor disclaims all warranties of merchantability 
or fitness for a particular purpose or use with respect to any such 
index or portfolio, any opening, intra-day or closing value therefor, 
any data included therein or relating thereto, or any option contract 
on Exchange-Traded Fund Shares based thereon. The index licensor will 
have no liability for any damages, claims, losses (including any 
indirect or consequential losses), expenses or delays, whether direct 
or indirect, foreseen or unforeseen, suffered by any person arising out 
of any circumstance or occurrence relating to the person's use of such 
index or portfolio, any opening, intra-day or closing value therefor, 
any data included therein or relating thereto, or any option contract 
on Exchange-Traded Fund Shares based thereon, or arising out of any 
errors or delays in calculating or disseminating such index or 
portfolio.
Section 10. Back-Up Trading Arrangements
    The Exchange proposes to add a new rule to Options 4, Section 10, 
titled ``Back-Up Trading Arrangements.'' Section 10 is currently 
reserved. This proposed rule is identical to ISE Options 4, Section 
10.\15\ This rule would permit BX to enter into arrangements with one 
or more other exchanges (each a ``Back-up Exchange'') to permit BX and 
its Participants to use a portion of a Back-up Exchange's facilities to 
conduct the trading of BX exclusively listed options in the event of a 
Disabling Event, and permits BX to provide trading facilities at BX for 
another exchange's exclusively listed options if that exchange (a 
``Disabled Exchange'') is prevented from trading due to a Disabling 
Event. Also, the proposed rule would permit BX to enter into 
arrangements with a Back-up Exchange to provide for the listing and 
trading of BX singly listed options by the Back-up Exchange if BX's 
facility becomes disabled, and conversely provide for the listing and 
trading by BX of the singly listed options of a Disabled Exchange.
---------------------------------------------------------------------------

    \15\ See Securities Exchange Act Release No. 71092 (December 17, 
2013), 78 FR 77510 (December 23, 2013) (SR-ISE-2013-61) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Relating 
to Back-Up Trading Arrangements).
---------------------------------------------------------------------------

    The back-up trading arrangements contemplated by Options 4, Section 
10 represent BX's immediate plan to ensure that its exclusively listed 
and singly listed options will have a trading venue if a catastrophe 
renders its primary facility inaccessible or inoperable.
    Section 10(a) describes the back-up trading arrangements that would 
apply if BX were the Disabled Exchange. An ``exclusively listed 
option'' is defined within Section 10(a)(1)(i) to mean an option that 
is listed exclusively by an exchange (because the exchange has an 
exclusive license to use, or has proprietary rights in, the interest 
underlying the option). Proposed paragraph(a)(1)(ii) provides that the 
facility of the Back-up Exchange used by BX to trade some or all of 
BX's exclusively listed options will be deemed to be a facility of BX, 
and such option classes shall trade as listings of BX. Since the 
trading of BX exclusively listed options will be conducted using the 
systems of the Back-up Exchange, proposed paragraph (a)(1)(iii) 
provides that the trading of BX listed options on BX's facility at the 
Back-up Exchange shall be conducted in accordance with the rules of the 
Back-up Exchange, and proposed paragraph (a)(1)(iv) provides that the 
Back-up Exchange has agreed to perform the related regulatory functions 
with respect to such trading, in each case except as BX and the Back-up 
Exchange may specifically agree otherwise. The Back-up Exchange rules 
that govern trading on BX's facility at the Back-up Exchange shall be 
deemed to be BX rules for purposes of such trading. Proposed paragraph 
(a)(1)(v) provides that BX shall have the right to designate its 
members that will be authorized to trade BX exclusively listed options 
on BX's facility at the Back-up Exchange and, if applicable, its 
member(s) that will be a BX Market

[[Page 42950]]

Maker in those options.\16\ If the Back-up Exchange is unable to 
accommodate all BX Participants that desire to trade on BX's facility 
at the Back-up Exchange, BX may determine which Participants shall be 
eligible to trade at that facility by considering factors such as 
whether the Participant is a BX Market Maker in the applicable 
product(s), the number of contracts traded by the member in the 
applicable product(s), market performance, and other factors relating 
to a member's contribution to the market in the applicable product(s). 
Under proposed paragraph (a)(1)(vi), Participants of the Back-up 
Exchange shall not be authorized to trade in any BX exclusively listed 
options, except that (i) BX may deputize willing brokers of the Back-up 
Exchange as temporary BX Participants to permit them to execute orders 
as brokers in BX exclusively listed options traded on BX's facility at 
the Back-up Exchange, and (ii) the Back-up Exchange has agreed that it 
will, at the instruction of BX, select members of the Back-up Exchange 
that are willing to be deputized by BX as temporary BX Participants 
authorized to trade BX exclusively listed options on BX's facility at 
the Back-up Exchange for such period of time following a Disabling 
Event as BX determines to be appropriate, and BX may deputize such 
members of the Back-up Exchange as temporary BX Participants for that 
purpose.
---------------------------------------------------------------------------

    \16\ Of note, unlike Phlx, BX does not have rules to appoint 
Lead Market Makers.
---------------------------------------------------------------------------

    The foregoing exceptions would permit members of the Back-up 
Exchange to trade BX exclusively listed options on the BX facility on 
the Back-up Exchange, if, for example, circumstances surrounding a 
Disabling Event result in BX Participants being delayed in connecting 
to the Back-up Exchange in time for prompt resumption of trading. 
Options 4, Section 10(a)(2) of the proposed rule provides for the 
continued trading of BX singly listed options at the Back-up Exchange 
in the event of a Disabling Event at BX. Proposed paragraph (a)(2)(ii) 
provides that BX may enter into arrangements with a Back-up Exchange 
under which the Back-up Exchange will agree, in the event of a 
Disabling Event, to list for trading option classes that are then 
singly listed only by BX. Such option classes would trade on the Back-
up Exchange as listings of the Back-up Exchange and in accordance with 
the rules of the Back-up Exchange. Under proposed paragraph 
(a)(2)(iii), any such options class listed by the Back-up Exchange that 
does not satisfy the standard listing and maintenance criteria of the 
Back-up Exchange will be subject, upon listing by the Back-up Exchange, 
to delisting (and, thus, restrictions on opening new series, and 
engaging in opening transactions in those series with open interest, as 
may be provided in the rules of the Back-up Exchange). BX singly listed 
option classes would be traded by members of the Back-up Exchange and 
by BX Participants selected by BX to the extent the Back-up Exchange 
can accommodate BX Participants in the capacity of temporary members of 
the Back-up Exchange. If the Back-up Exchange is unable to accommodate 
all BX Participants that desire to trade BX singly listed options at 
the Back-up Exchange, BX may determine which Participants shall be 
eligible to trade such options at the Back-up Exchange by considering 
the same factors used to determine which BX Participants are eligible 
to trade BX exclusively listed options at the BX facility at the Back-
up Exchange.
    Proposed Section (a)(3) provides that BX may enter into 
arrangements with a Back-up Exchange to permit BX Participants to 
conduct trading on a Back-up Exchange of some or all of BX's multiply 
listed options in the event of a Disabling Event. While continued 
trading of multiply listed options upon the occurrence of a Disabling 
Event is not likely to be as great a concern as the continued trading 
of exclusively and singly listed options, BX nonetheless believes a 
provision for multiply listed options should be included in the rule so 
that the exchanges involved will have the option to permit members of 
the Disabled Exchange to trade multiply listed options on the Back-up 
Exchange. Such options shall trade as a listing of the Back-up Exchange 
in accordance with the rules of the Back-up Exchange.
    Options 4, Section 10(b) describes the back-up trading arrangements 
that would apply if BX were the Back-up Exchange. In general, the 
provisions in Section (b) are the converse of the provisions in Section 
(a). With respect to the exclusively listed options of the Disabled 
Exchange, the facility of BX used by the Disabled Exchange to trade 
some or all of the Disabled Exchange's exclusively listed options will 
be deemed to be a facility of the Disabled Exchange, and such option 
classes shall trade as listings of the Disabled Exchange. Trading of 
the Disabled Exchange's exclusively listed options on the Disabled 
Exchange's facility at BX shall be conducted in accordance with BX 
rules, and BX will perform the related regulatory functions with 
respect to such trading, in each case except as the Disabled Exchange 
and BX may specifically agree otherwise. BX rules that govern trading 
on the Disabled Exchange's facility at BX shall be deemed to be rules 
of the Disabled Exchange for purposes of such trading. Sections (b)(2) 
and (b)(3) describe the arrangements applicable to trading of the 
Disabled Exchange's singly and multiply listed options at BX, and are 
the converse of Sections (a)(2) and (a)(3). Paragraph (b)(2)(i) 
includes a provision that would permit BX to allocate singly listed 
option classes of the Disabled Exchange to a BX Market Maker in advance 
of a Disabling Event, without utilizing the allocation process under BX 
Rule Options 2, Section 1, to enable BX to quickly list such option 
classes upon the occurrence of a Disabling Event.
    Options 4, Section 10(c) describes the obligations of Participants 
with respect to the trading by ``temporary members'' on the facilities 
of another exchange. Section (c)(1) sets forth the obligations 
applicable to Participants of a Back-up Exchange who act in the 
capacity of temporary Participants of the Disabled Exchange on the 
facility of the Disabled Exchange at the Back-up Exchange. Section 
(c)(1) provides that a temporary Participant of the Disabled Exchange 
shall be subject to, and obligated to comply with, the rules that 
govern the operation of the facility of the Disabled Exchange at the 
Back-up Exchange. This would include the rules of the Disabled Exchange 
to the extent applicable during the period of such trading, including 
the rules of the Disabled Exchange limiting its liability for the use 
of its facilities that apply to members of the Disabled Exchange. 
Additionally, (i) such temporary Participant shall be deemed to have 
satisfied, and the Disabled Exchange has agreed to waive specific 
compliance with, rules governing or applying to the maintenance of a 
person's or a firm's status as a Participant of the Disabled Exchange, 
including all dues, fees and charges imposed generally upon members of 
the Disabled Exchange based on their status as such, (ii) such 
temporary Participant shall have none of the rights of a member of the 
Disabled Exchange except the right to conduct business on the facility 
of the Disabled Exchange at the Back-up Exchange to the extent 
described in the Rule, (iii) the Participant associated with such 
temporary Participant, if any, shall be responsible for all obligations 
arising out of that temporary Participant's activities on or relating 
to the Disabled Exchange, and (iv) the clearing member of such 
temporary Participant shall

[[Page 42951]]

guarantee and clear the transactions of such temporary Participant on 
the Disabled Exchange.
    Section (c)(2) sets forth the obligations applicable to members of 
a Disabled Exchange who act in the capacity of temporary Participants 
of the Back-up Exchange for the purpose of trading singly listed and 
multiply listed options of the Disabled Exchange. Such temporary 
Participants shall be subject to, and obligated to comply with, the 
rules of the Back-up Exchange that are applicable to the Back-up 
Exchange's own members, including the rules of the Back-up Exchange 
limiting its liability for the use of its facilities that apply to 
members of the Back-up Exchange. Temporary Participants of the Back-up 
Exchange have the same obligations as those set forth in Section (c)(1) 
that apply to temporary Participants of the Disabled Exchange, except 
that, in addition, temporary Participants of the Back-up Exchange shall 
only be permitted (i) to act in those capacities on the Back-up 
Exchange that are authorized by the Back-up Exchange and that are 
comparable to capacities in which the temporary Participant has been 
authorized to act on the Disabled Exchange, and (ii) to trade in those 
option classes in which the temporary Participant is authorized to 
trade on the Disabled Exchange.
    Options 4, Section 10 provides that the rules of the Back-up 
Exchange shall apply to the trading of the singly and multiply listed 
options of the Disabled Exchange traded on the Back-up Exchange's 
facilities, and (with certain limited exceptions) the trading of 
exclusively listed options of the Disabled Exchange traded on the 
facility of the Disabled Exchange at the Back-up Exchange. The Back-up 
Exchange has agreed to perform the related regulatory functions with 
respect to such trading (except as the Back-up Exchange and the 
Disabled Exchange may specifically agree otherwise). Section (d) 
provides that if a Back-up Exchange initiates an enforcement proceeding 
with respect to the trading during a back-up period of singly or 
multiply listed options of the Disabled Exchange by a temporary 
Participant of the Back-up Exchange, or exclusively listed options of 
the Disabled Exchange by a member of the Disabled Exchange (other than 
a member of the Back-up Exchange who is a temporary member of the 
Disabled Exchange), and such proceeding is in process upon the 
conclusion of the back-up period, the Back-up Exchange may transfer 
responsibility for such proceeding to the Disabled Exchange following 
the conclusion of the back-up period. This approach to the exercise of 
enforcement jurisdiction is also consistent with past precedent.
    With respect to arbitration jurisdiction, proposed Section (d) 
provides that arbitration of any disputes with respect to any trading 
during a back-up period of singly or multiply listed options of the 
Disabled Exchange or of exclusively listed options of the Disabled 
Exchange on the Disabled Exchange's facility at the Back-up Exchange 
will be conducted in accordance with the rules of the Back-up Exchange, 
unless the parties to an arbitration agree that it shall be conducted 
in accordance with the rules of the Disabled Exchange.
    Proposed Supplementary Material .01 to Options 4, Section 10 
clarifies that to the extent Options 4, Section 10 provides that 
another exchange will take certain action, the Rule is reflecting what 
that exchange has agreed to do by contractual agreement with BX, but 
Options 4, Section 10 is not binding on the other exchange.
Options 4C
    The Exchange proposes to reserve 4C as BX does not list U.S. 
Dollar-Settled Foreign Currency Options.
Bid/Ask Differentials
    The Exchange proposes to amend Options 4, Section 8(a), and Options 
4A, Section 12(b)(1)(i) to relocate text concerning bid/ask 
differentials for long-term option series. Currently, Options 4, 
Section 8(a) describes the bid/ask differentials for long-term options 
series for equity options and exchange-traded products and Options 4A, 
Section 12(b)(1)(i) describes the bid/ask differentials for long-term 
options series for indexes. Currently, the bid/ask differentials shall 
not apply to such options series until the time to expiration is less 
than nine (9) months for equity options and exchange-traded funds as 
provided for within Options 4, Section 8(a). Currently, bid/ask 
differentials shall not apply to such options series until the time to 
expiration is less than nine (9) months for index options as provided 
for within Options 4A, Section 12(b)(1)(i).
    The Exchange proposes to centralize the bid/ask differentials 
within Options 2, Section 5(d)(2)(A) and add a sentence to both Options 
4, Section 8(a) and Options 4A, Section 12(b)(1)(i) that cites to 
Options 2, Section 5(d)(2)(A) for information on bid/ask differentials 
for the various products. The Exchange also proposes to capitalize 
``ask'' in the title of Options 2, Section 5(d)(2). The Exchange 
believes that this relocation will provide Market Makers with 
centralized information regarding their bid/ask differential 
requirements. The Exchange is not amending the bid/ask differentials; 
the rule text is simply being relocated.
Technical Amendment
    The Exchange proposes to amend General 9, Section 51, Research 
Analysts, to update an improper citation to ``General 9, Section 50'' 
to ``this Rule.'' The citation is to General 9, Section 51. The 
Exchange also proposes to remove stray periods throughout Options 4 in 
the section headings.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\17\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\18\ in particular, in that it is designed 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. Conforming BX's Options 4 Listing Rules to that of ISE 
Options 4 is part of the Exchange's continued effort to promote 
efficiency in the manner in which it administers its rules.
---------------------------------------------------------------------------

    \17\ 15 U.S.C. 78f(b).
    \18\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange's proposal to amend Options 4, Sections 1, 2, 5, and 7 
reflect non-substantive amendments to conform those rules to similar 
ISE rules. These proposed changes removes 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 since the 
changes are intended to ease the Participants', market participants', 
and the general public's navigation and reading of the rules and lessen 
potential confusion and add clarity for market participants.
    The proposed amendments to ISE Options 3, Section 3(b) to permit 
the Exchange, in exceptional circumstances, to select an underlying 
security even though it does not meet all of the guidelines, is 
consistent with the Act. Today, the Exchange may establish guidelines 
to be considered in evaluating potential underlying securities for 
Exchange options transactions. Providing BX with the same ability to 
select an underlying security even though it does not meet all of the 
guidelines as ISE will permit BX to list similar options as ISE for 
competitive purposes.
    The Exchange's proposal to add the defined term ``Financial 
Instruments'' within Options 4, Section 3(h) and also

[[Page 42952]]

account for money market instruments, U.S. government securities and 
repurchase agreements, defined by the term ``Money Market Instruments'' 
similar to ISE Options 4, Section 3(h) is consistent with the Act. The 
addition of money market instruments, U.S. government securities and 
repurchase agreements as securities deemed appropriate for options 
trading will make clear that these agreements are included in the 
acceptable securities. The Exchange notes that this rule text is 
clarifying in nature and will more explicitly provide for money market 
instruments, U.S. government securities and repurchase agreements as a 
separate category from what is being defined as ``Financial 
Instruments'' with this proposal. Today, these instruments are eligible 
as securities deemed appropriate for options trading.
    The Exchange's proposal to remove the following products from 
Options 4, Section 3(h): The ETFS Silver Trust, the ETFS Palladium 
Trust, the ETFS Platinum Trust or the Sprott Physical Gold Trust is 
consistent with the Act because the Exchange no longer lists these 
products and proposes to remove them the products from its listing 
rules. The Exchange will file a proposal with the Commission if it 
determines to list these products in the future.
    The Exchange's proposal to amend Options 4, Section 3(h) by 
removing the rule text at the end of the paragraph which provides, 
``all of the following conditions are met,'' and creating separate 
paragraphs for Options 4, Section 3(h)(1) and (2) is consistent with 
the Act. These amendments will de-link these subparagraphs so they are 
read independently. Today, Options 4, Section 3(h)(1) applies to all 
Exchange-Traded Fund Shares. The Exchange's proposal to clarify that 
Options 4, Section 3(h)(2) applies to only international or global 
indexes or portfolios that include non-U.S. securities will bring 
greater clarity to the qualification standards for listing options on 
Exchange-Traded Fund Shares. ISE Options 4, Section 3(h) currently has 
similar rule text. Proposed Options 4, Sections 3(h) generally concerns 
securities deemed appropriate for options trading. The proposed new 
rule text adds language stating that subparagraph (h)(2) of Options 4, 
Section 3 applies to the extent the Exchange-Traded Fund Share is based 
on international or global indexes or portfolios that include non-U.S. 
securities. This language is intended to serve as a guidepost and 
clarify that (1) subparagraph (h)(2) does not apply to an Exchange-
Traded Fund Shares based on a U.S. domestic index or portfolio, and (2) 
subparagraph (h)(2) includes Exchange-Traded Fund Shares that track a 
portfolio and do not track an index.
    The Exchange's proposal to amend Options 4, Section 3(h)(2)(A) to 
remove the phrase ``for series of portfolio depositary receipts and 
index fund shares based on international or global indexes,'' is 
consistent with the Act. Today, Options 4, Section 3(h), subparagraphs 
(h)(1) and (h)(v) permit the Exchange to list options on Exchange-
Traded Fund Shares based on generic listing standards for portfolio 
depositary receipts and index fund shares without applying component 
based requirements in subparagraphs (h)(2)(B)-(D). By removing the 
proposed rule text, the Exchange would make clear that subparagraph 
(h)(2)(A) applies to Exchange-Traded Fund Shares based on international 
or global indexes, or portfolios that include non-U.S. securities, that 
are listed pursuant to generic listing standards and comply with 
Options 4, Section 3(h) and subparagraph (h)(1).
    The Exchange's proposal to amend the term ``comprehensive 
surveillance agreement'' within Options 4, Section 3(h)(2) (A)-(D) to 
instead provide ``comprehensive surveillance sharing agreement'' is 
consistent with the Act as the amendment will bring greater clarity to 
the term.
    The Exchange's proposal to add the phrase ``if not available or 
applicable, the Exchange-Traded Fund's'' to Options 4, Section 
3(h)(2)(B), (C), and (D) is consistent with the Act as it will clarify 
that when component securities are not available, the portfolio of 
securities upon which the Exchange-Traded Fund Share is based can be 
used instead. This rule text currently exists within ISE Options 4, 
Section 3(h).
    The Exchange's proposal to amend and relocate the rule text within 
Options 4, Section 3(h)(2)(B), (C), and (D) will bring greater clarity 
to the current rule text by explicitly providing that the index being 
referenced is the one on which the Exchange-Traded Fund Shares is 
based. Also, adding ``or portfolio'' to Options 4, Section 3(h)(2)(C), 
and (D) will bring greater clarity to the rule text by conforming the 
rule text of (C) and (D) to the language within (B).
    The proposed amendments to Options 4, Section 3(h) will conform 
BX's rule text to ISE Options 4, Section 3(h).
    The remainder of the change to Options 3, Section 3 are non-
substantive and intended to conform to ISE Options 3, Section 3. These 
proposed changes 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 since the changes are 
intended to ease the Participants', market participants', and the 
general public's navigation and reading of the rules and lessen 
potential confusion and add clarity for market participants.
    The proposed amendments to Options 4, Section 4 remove unnecessary 
rule text and make clear that options contracts that are no longer 
approved will not be listed. The proposed amendments to adopt new 
Options 4, Section 4(i) similar to ISE, Options 4, Section 4(i), are 
consistent with the Act. Today, the Exchange would not open additional 
series of HOLDRs without filing a rule change with the Commission and 
adopting a corresponding rule. This rule text, similar to ISE, 
explicitly provides that the Exchange would not open additional series 
of options overlying HOLDRs (without prior Commission approval) if: (1) 
The proportion of securities underlying standardized equity options to 
all securities held in a HOLDRs trust is less than 80% (as measured by 
their relative weightings in the HOLDRs trust); or (2) less than 80% of 
the total number of securities held in a HOLDRs trust underlie 
standardized equity options. This rule text bring greater clarity to 
BX's rules in that HOLDRs would not be in certain circumstances.
    The Exchange's proposal to remove the rule text within Options 4, 
Section 4(l), related to inadequate volume delisting, is consistent 
with the Act. To remain competitive with other options markets, the 
Exchange proposes to adopt the same obligations for continuance of 
trading.\19\ Also, pursuant to proposed new Options 4, Section 5(e) the 
Exchange will announce securities that have been withdrawn. With this 
proposal, the Exchange would eliminate the requirement that an option 
must be trading for more than 6 months. The Exchange notes that this 
condition is not present on other options markets such as ISE and 
Cboe.\20\ This also applies to the requirement that the average daily 
volume of the entire class of options over the last six (6) month 
period was less than twenty (20) contracts. The Exchange notes that 
BX's requirements are different than other options markets and to 
remain competitive the Exchange proposes to adopt the same standards as 
ISE and Cboe to remain competitive and list similar options as the 
other markets. While the Exchange may in the future

[[Page 42953]]

determine to delist an option that is singly listed, the Exchange's 
proposal to remove the rule text which provides that ``If the option is 
singly listed only on the Exchange, the Exchange will cease to add new 
series and may delist the class of options when there is no remaining 
open interest'' is consistent with the Act. This rule text does not 
exist on ISE and Cboe. The Exchange today provides notification of a 
delisting to all members so therefore it is not necessary to retain the 
provisions within (b)(2). Also, proposed new Options 4, Section 4(e) 
establishes the rules by which the Exchange will announce securities 
that have been withdrawn. The rule text within Options 4, Section 4(b), 
as amended to conform to ISE rule text, will continue to govern the 
continued approval of options on the Exchange.
---------------------------------------------------------------------------

    \19\ Options 4, Section 4(b), as amended, establishes 
requirements for continued listing, similar to ISE.
    \20\ See ISE Options 4, Section 4 and Cboe Rule 4.4.
---------------------------------------------------------------------------

    The remainder of the changes to Options 3, Section 3 remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system, and, in general protects investors and the 
public interest. Overall, these changes are of a non-substantive nature 
and either modify, clarify or relocate the existing Rulebook language 
to reflect the language of the ISE version of the rule and are intended 
to ease the Participants', market participants', and the general 
public's navigation and reading of the rules and lessen potential 
confusion and add clarity for market participants.
    The Exchange believes that the changes to proposed Options 4, 
Section 8 removes impediments to and perfects the mechanism of a free 
and open market and a national market system, and, in general protects 
investors and the public interest because the changes are mainly of a 
non-substantive nature with much of the rule text largely simply being 
relocated from current Options 4, Section 5(a)(i)(D) to new Options 4, 
Section 8(a) with some minor amendments and is intended to ease the 
Participants', market participants', and the general public's 
navigation and reading of the rules and lessen potential confusion and 
add clarity for market participants.
    The Exchange's proposal to amend Options 3, Section 8 and Options 
4A, Section 12(b)(1)(i) to relocate text concerning bid/ask 
differentials for long-term option series is consistent with the Act. 
The Exchange's proposal will centralize the bid/ask differentials 
within Options 2, Section 5(d)(2)(A) and add a sentence to both Options 
3, Section 8 and Options 4A, Section 12(b)(1)(i) that cites to Options 
2, Section 5(d)(2)(A) for information on bid/ask differentials for the 
various products. The Exchange is not amending the bid/ask 
differentials; the rule text is simply being relocated. The Exchange 
believes that this relocation will provide Market Makers with 
centralized information regarding their bid/ask differential 
requirements.
    The remainder of the changes to Options 3, Section 8 are non-
substantive.
    The Exchange believes that adopting a new Section 9, Limitation on 
the Liability of Index Licensors for Option on Fund Share, similar to 
ISE, is consistent with the Act. Specifically, this proposal seeks to 
limit the liability of index licensors who grant the BX a license to 
use their underlying indexes or portfolios in connection with the 
trading of options on Fund Shares. This rule text is identical to ISE 
rule text.\21\ Proposed Section 9(b) provides that no index licensor 
with respect to any index or portfolio underlying an option on 
Exchange-Traded Fund Shares traded on the Exchange makes any warranty, 
express or implied, as to the results to be obtained by any person or 
entity from the use of such index or portfolio, any opening, intra-day 
or closing value therefor, or any data included therein or relating 
thereto, in connection with the trading of any option contract on 
Exchange-Traded Fund Shares based thereon or for any other purpose. The 
disclaimers within proposed Section 9 are consistent with the Act in 
that these disclaimers provide market participants with relevant 
information as to the liabilities on option contracts on Exchange-
Traded Fund Shares.
---------------------------------------------------------------------------

    \21\ See ISE Options Listing Rule Section 9.
---------------------------------------------------------------------------

    The Exchange believes that the adoption of Options 4, Section 10, 
Back-up Trading Arrangements, will provide BX with similar abilities as 
ISE to permit BX to enter into arrangements with one or more other 
exchanges (each a ``Back-up Exchange'') to permit BX and its 
Participants to use a portion of a Back-up Exchange's facilities to 
conduct the trading of BX exclusively listed \22\ options in the event 
of a Disabling Event, and similarly to permit BX to provide trading 
facilities for another exchange's exclusively listed options if that 
exchange (a ``Disabled Exchange'') is prevented from trading due to a 
Disabling Event. With this proposal, BX is proposing to adopt listing 
rules similar to Phlx to list and trade U.S. Dollar-Settled Foreign 
Currency Options. BX believes that it is important that it develop 
back-up trading arrangements to minimize the potential disruption and 
market impact that a Disabling Event could cause. The proposed rule 
changes are designed to address the key elements necessary to mitigate 
the effects of a Disabling Event affecting the Exchange, minimize the 
impact of such an event on market participants, and provide for a 
liquid and orderly marketplace for securities listed and traded on the 
Exchange if a Disabling Event occurs. In particular, the proposed rule 
change is intended to ensure that BX's exclusively listed and singly 
listed products will have a trading venue in the event that trading at 
BX is prevented due to a Disabling Event. The Exchange believes that 
having these back-up trading arrangements in place will minimize 
potential disruptions to the markets and investors if a catastrophe 
occurs that requires the Exchange's primary facility to be closed for 
an extended period. Phlx and ISE has a similar rule,\23\ and the 
Exchange believes that it is important to the protection of investors 
and the public interest that it also adopt rules that allow BX 
exclusively and singly listed options to continue to trade in the event 
of a Disabling Event. The proposed rule change also provides authority 
for the BX to provide a back-up trading venue should another exchange 
be affected by a Disabling Event, which will benefit the markets and 
investors if a Disabling Event were to happen on another exchange that 
has entered into a back-up trading arrangement with the BX. Finally, 
the proposed rule change grants authority to Exchange officials to take 
action under emergency conditions, which should enable key actions to 
be taken by BX representatives in the event of a Disabling Event, and 
clarifies the fees that will apply if these back-up trading 
arrangements are invoked, which will reduce investor confusion and 
minimize the disruption to investors associated with a Disabling Event. 
Under proposed paragraph (a)(1)(vi), members of the Back-up Exchange 
shall not be authorized to trade in any BX exclusively listed options, 
except that (i) BX may deputize willing brokers of the Back-up Exchange 
as temporary BX Participants to permit them to execute orders as 
Participants in BX exclusively listed options traded on BX's facility 
at the Back-up Exchange, and (ii) the Back-up Exchange has agreed that 
it will, at the instruction of BX, select members of the Back-up 
Exchange that are willing to be deputized by BX as temporary BX

[[Page 42954]]

members authorized to trade BX exclusively listed options on BX's 
facility at the Back-up Exchange for such period of time following a 
Disabling Event as BX determines to be appropriate, and BX may deputize 
such members of the Back-up Exchange as temporary BX members for that 
purpose. The foregoing exceptions would permit members of the Back-up 
Exchange to trade BX exclusively listed options on the BX facility on 
the Back-up Exchange, if, for example, circumstances surrounding a 
Disabling Event result in BX members being delayed in connecting to the 
Back-up Exchange in time for prompt resumption of trading.
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    \22\ As defined within the proposed rule, the term ``exclusively 
listed option'' means an option that is listed exclusively by an 
exchange (because the exchange has an exclusive license to use, or 
has proprietary rights in, the interest underlying the option).
    \23\ See Phlx and ISE Rules Options 3, Section 10.
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    The Exchange's proposal to reserve Options 4C will make clear that 
BX does not list U.S. Dollar-Settled Foreign Currency Options. Other 
Nasdaq Affiliated exchanges, such as Nasdaq Phlx LLC, list U.S. Dollar-
Settled Foreign Currency Options and would therefore have rules in that 
section. By marking Options 4C reserved, market participants will be 
given additional insight into the types of products available on BX.
Technical Amendment
    The Exchange's proposal to amend General 9, Section 51, Research 
Analysts, to update an improper citation to ``General 9, Section 50'' 
to ``this Rule'' and remove stray periods throughout Options 4 in the 
section headings are consistent with the Act. This non-substantive 
amendment will bring greater clarity to the rule.

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The relocation of the Options 
Listing Rules will facilitate the use of the Rulebook by Participants 
of the Exchange, who are members of other Affiliated Exchanges; other 
market participants; and the public in general. The changes are 
consistent with the ISE Rulebook.
    The Exchange's proposal to amend Options 4, Sections 1, 2, 5, and 7 
reflects non-substantive amendments to conform those rules to similar 
ISE rules at Options 4, Sections 1, 2, 5, and 7. These proposed changes 
do not impose an undue burden on competition since the changes are 
intended to ease the Participants', market participants', and the 
general public's navigation and reading of the rules and lessen 
potential confusion and add clarity for market participants.
    The proposed amendments to ISE Options 3, Section 3(b) to permits 
the Exchange, in exceptional circumstances, to select an underlying 
security even though it does not meet all of the guidelines do not 
impose an undue burden on competition. Today, the Exchange may 
establish guidelines to be considered in evaluating potential 
underlying securities for Exchange options transactions. Providing BX 
with the same ability to select an underlying security even though it 
does not meet all of the guidelines as ISE will permit BX to list 
similar options as ISE for competitive purposes.
    The Exchange's proposal to add the defined term ``Financial 
Instruments'' within Options 4, Section 3(h) and also account for money 
market instruments, U.S. government securities and repurchase 
agreements, defined by the term ``Money Market Instruments'' similar to 
ISE Options 4, Section 3(h) do not impose an undue burden on 
competition. The addition of money market instruments, U.S. government 
securities and repurchase agreements as securities deemed appropriate 
for options trading will make clear that these agreements are included 
in the acceptable securities.
    The Exchange's proposal to remove the following products from 
Options 4, Section 3(h): The ETFS Silver Trust, the ETFS Palladium 
Trust, the ETFS Platinum Trust or the Sprott Physical Gold Trust do not 
impose an undue burden on competition. The Exchange no longer lists 
these products and proposes to remove them the products from its 
listing rules.
    The Exchange's proposal to amend Options 4, Section 3(h) by 
removing the rule text at the end of the paragraph which provides, 
``all of the following conditions are met,'' and creating separate 
paragraphs for Options 4, Section 3(h)(1) and (2) does not impose an 
undue burden on competition. These amendments will de-link these 
subparagraphs so they are read independently. Today, Options 4, Section 
3(h)(1) applies to all Exchange-Traded Fund Shares. The Exchange's 
proposal to clarify that Options 4, Section 3(h)(2) applies to only 
international or global Exchange-Traded Fund Shares that include non-
U.S. securities will bring greater clarity to the qualification 
standards for listing options on Exchange-Traded Fund Shares. 
Specifically, this language is intended to serve as a guidepost and 
clarify that (1) subparagraph (h)(2) does not apply to an Exchange-
Traded Fund Shares based on a U.S. domestic index or portfolio, and (2) 
subparagraph (h)(2) includes Exchange-Traded Fund Shares that track a 
portfolio and do not track an index. This amendment will uniformly 
apply the criteria within Options 4, Section 3 when it lists options 
products on BX.
    The Exchange's proposal to amend Options 4, Section 3(h)(2)(A) to 
remove the phrase ``for series of portfolio depositary receipts and 
index fund shares based on international or global indexes,'' does not 
impose an undue burden on competition. Today, Options 4, Section 3(h), 
subparagraphs (h)(1) and (h)(v) permit the Exchange to list options on 
Exchange-Traded Fund Shares based on generic listing standards for 
portfolio depositary receipts and index fund shares without applying 
component based requirements in subparagraphs (h)(2)(B)-(D). By 
removing the proposed rule text, the Exchange would make clear that 
subparagraph (h)(2)(A) applies to Exchange-Traded Fund Shares based on 
international or global indexes, or portfolios that include non-U.S. 
securities, that are listed pursuant to generic listing standards and 
comply with Options 4, Section 3(h) and subparagraph (h)(1). This 
amendment will uniformly apply the criteria within Options 4, Section 3 
when it lists options products on BX.
    The Exchange's proposal to amend the term ``comprehensive 
surveillance agreement'' within Options 4, Section 3(h)(2) (A)-(D) to 
instead provide ``comprehensive surveillance sharing agreement'' does 
not impose an undue burden on competition as the amendment will bring 
greater clarity to the term.
    The Exchange's proposal to add the phrase ``if not available or 
applicable, the Exchange-Traded Fund's'' to Options 4, Section 
3(h)(2)(B), (C), and (D) does not impose an undue burden on competition 
as it will clarify that when component securities are not available, 
the portfolio of securities upon which the Exchange-Traded Fund Share 
is based can be used instead.
    The Exchange's proposal to amend and relocate the rule text within 
Options 4, Section 3(h)(2)(B), (C), and (D) will bring greater clarity 
to the current rule text by explicitly providing that the index being 
referenced is the one on which the Exchange-Traded Fund Shares is 
based. Also, adding ``or portfolio'' to Options 4, Section 3(h)(2)(C), 
and (D) will bring greater clarity to the rule text by conforming the 
rule text of (C) and (D) to the language within (B).
    The proposed amendments to Options 4, Section 4 remove unnecessary 
rule text and make clear that options contracts that are no longer 
approved

[[Page 42955]]

will not be listed. The proposed amendments to adopt new Options 4, 
Section 4(i) similar to ISE, Options 4, Section 4(i), does not impose 
an undue burden on competition. The amendments would provide for 
provisions wherein the Exchange will not open additional series of 
options overlying HOLDRs similar to ISE, which provisions do not 
currently exist.
    The Exchange's proposal to remove the rule text within Options 4, 
Section 4(l), related to inadequate volume delisting, does not impose 
an undue burden on competition. To remain competitive with other 
options markets, the Exchange proposes to adopt the same obligations 
for continuance of trading.\24\ Also, pursuant to proposed new Options 
4, Section 5(e) the Exchange will announce securities that have been 
withdrawn. With this proposal, the Exchange would eliminate the 
requirement that an option must be trading for more than 6 months. The 
Exchange notes that this condition is not present on other options 
markets such as ISE and Cboe.\25\ This also applies to the requirement 
that the average daily volume of the entire class of options over the 
last six (6) month period was less than twenty (20) contracts. The 
Exchange notes that BX's requirements are different than other options 
markets and to remain competitive the Exchange proposes to adopt the 
same standards as ISE and Cboe to remain competitive and list similar 
options as the other markets. The Exchange's proposal removes the rule 
text which provides that ``If the option is singly listed only on the 
Exchange, the Exchange will cease to add new series and may delist the 
class of options when there is no remaining open interest'' does not 
impose an undue burden on competition. This rule text does not exist on 
ISE and Cboe. The Exchange today provides notification of a delisting 
to all members so therefore it is not necessary to retain the 
provisions within (b)(2). Also, proposed new Options 4, Section 4(e) 
establishes the rules by which the Exchange will announce securities 
that have been withdrawn.
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    \24\ Options 4, Section 4(b), as amended, establishes 
requirements for continued listing, similar to ISE.
    \25\ See ISE Options 4, Section 4 and Cboe Rule 4.4.
---------------------------------------------------------------------------

    The Exchange believes that the changes to proposed Options 4, 
Section 8 do not impose an undue burden on competition as the changes 
are mainly of a non-substantive nature with much of the rule text 
largely simply being relocated from current Options 4, Section 
5(a)(i)(D) to new Options 4, Section 8(a) with some minor amendments.
    The Exchange's proposal to amend Options 3, Section 8 and Options 
4A, Section 12(b)(1)(i) to relocate text concerning bid/ask 
differentials for long-term option series does not impose an undue 
burden on competition. The Exchange believes that this relocation will 
provide Market Makers with centralized information regarding their bid/
ask differential requirements.
    Adopting a new Section 9, Limitation on the Liability of Index 
Licensors for Option on Fund Share, similar to ISE does not impose an 
undue burden on competition. The proposal seeks to limit the liability 
of index licensors who grant the BX a license to use their underlying 
indexes or portfolios in connection with the trading of options on Fund 
Shares. This rule text is identical to ISE rule text.\26\ Proposed 
Section 9(b) provides that no index licensor with respect to any index 
or portfolio underlying an option on Exchange-Traded Fund Shares traded 
on the Exchange makes any warranty, express or implied, as to the 
results to be obtained by any person or entity from the use of such 
index or portfolio, any opening, intra-day or closing value therefor, 
or any data included therein or relating thereto, in connection with 
the trading of any option contract on Exchange-Traded Fund Shares based 
thereon or for any other purpose.
---------------------------------------------------------------------------

    \26\ See ISE Options Listing Rule Section 9.
---------------------------------------------------------------------------

    The Exchange believes that the adoption of Options 4, Section 10, 
Back-up Trading Arrangements, will provide BX with similar abilities as 
ISE to permit BX to enter into arrangements with one or more other 
exchanges (each a ``Back-up Exchange'') to permit BX and its 
Participants to use a portion of a Back-up Exchange's facilities to 
conduct the trading of BX exclusively listed \27\ options in the event 
of a Disabling Event, and similarly to permit BX to provide trading 
facilities for another exchange's exclusively listed options if that 
exchange (a ``Disabled Exchange'') is prevented from trading due to a 
Disabling Event. Permitting BX to list U.S. Dollar-Settled Foreign 
Currency Options similar to Phlx would allow market participants 
another venue in which to transact U.S. Dollar-Settled Foreign Currency 
Options.
---------------------------------------------------------------------------

    \27\ As defined within the proposed rule, the term ``exclusively 
listed option'' means an option that is listed exclusively by an 
exchange (because the exchange has an exclusive license to use, or 
has proprietary rights in, the interest underlying the option).
---------------------------------------------------------------------------

Technical Amendment
    The Exchange's proposal to amend General 9, Section 51, Research 
Analysts, to update an improper citation to ``General 9, Section 50'' 
to ``this Rule'' and remove stray periods throughout Options 4 in the 
section headings do not impose an undue burden on competition. This 
non-substantive amendment will bring greater clarity to the rule.

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

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    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)(iii) of the Act \28\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\29\
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    \28\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \29\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file 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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    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 should be approved or disapproved.
    A proposed rule change filed under Rule 19b-4(f)(6) \30\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\31\ the Commission 
may designate a shorter time if such action is consistent with 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposed

[[Page 42956]]

rule change may become operative upon filing. The Exchange's proposal 
does not raise any new or novel issues. Therefore, the Commission 
believes that waving the 30-day operative delay is consistent with the 
protection of investors and the public interest. Accordingly, the 
Commission designates the proposed rule change to be operative on upon 
filing.\32\
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    \30\ 17 CFR 240.19b-4(f)(6).
    \31\ 17 CFR 240.19b-4(f)(6).
    \32\ 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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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-BX-2021-032 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-BX-2021-032. 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-BX-2021-032 and should be submitted on 
or before August 26, 2021.
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    \33\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\33\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-16677 Filed 8-4-21; 8:45 am]
BILLING CODE 8011-01-P