Self-Regulatory Organizations; Miami International Securities Exchange, LLC and MIAX Emerald, LLC; Suspension of and Order Instituting Proceedings To Determine Whether To Approve or Disapprove Proposed Rule Changes To Establish Fees for the Exchanges' cToM Market Data Products, 49364-49367 [2021-18942]
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Federal Register / Vol. 86, No. 168 / Thursday, September 2, 2021 / Notices
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–PEARL–2021–33 and
should be submitted on or before
September 23, 2021. Rebuttal comments
should be submitted by October 7, 2021.
VI. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(3)(C) of the Act,53 that File
Number SR–PEARL–2021–33 be and
hereby is, temporarily suspended. In
addition, the Commission is instituting
proceedings to determine whether the
proposed rule change should be
approved or disapproved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.54
Vanessa A. Countryman,
Secretary.
[FR Doc. 2021–18949 Filed 9–1–21; 8:45 am]
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BILLING CODE 8011–01–P
53 15
54 17
U.S.C. 78s(b)(3)(C).
CFR 200.30–3(a)(57) and (58).
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–92789; File Nos. SR–MIAX–
2021–28, SR–EMERALD–2021–21]
Self-Regulatory Organizations; Miami
International Securities Exchange, LLC
and MIAX Emerald, LLC; Suspension
of and Order Instituting Proceedings
To Determine Whether To Approve or
Disapprove Proposed Rule Changes
To Establish Fees for the Exchanges’
cToM Market Data Products
August 27, 2021.
I. Introduction
On June 30, 2021, Miami International
Securities Exchange, LLC (‘‘MIAX’’) and
MIAX Emerald, LLC (‘‘MIAX Emerald’’)
(each, an ‘‘Exchange,’’ and collectively,
the ‘‘Exchanges’’) each filed with the
Securities and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change to
establish fees for, respectively, the
MIAX Complex Top of Market (‘‘cToM’’)
and the MIAX Emerald cToM market
data products. The proposed rule
changes were immediately effective
upon filing with the Commission
pursuant to Section 19(b)(3)(A) of the
Act.3 The proposed rule changes were
published for comment in the Federal
Register on July 15, 2021.4 Pursuant to
Section 19(b)(3)(C) of the Act,5 the
Commission is hereby: (1) Temporarily
suspending the proposed rule changes;
and (2) instituting proceedings to
determine whether to approve or
disapprove the proposed rule changes.
II. Description of the Proposed Rule
Changes
The Exchanges propose to establish
fees for their cToM market data
products.6 According to the Exchanges,
the cToM feed provides subscribers
with the same information as the
Exchanges’ respective simple order
market Top of Market (‘‘ToM’’) feeds,
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A). A proposed rule change
may take effect upon filing with the Commission if
it is designated by the exchange as ‘‘establishing or
changing a due, fee, or other charge imposed by the
self-regulatory organization on any person, whether
or not the person is a member of the self-regulatory
organization.’’ 15 U.S.C. 78s(b)(3)(A)(ii).
4 See Securities Exchange Act Release Nos. 92359
(July 9, 2021), 86 FR 37393 (SR–MIAX–2021–28);
and 92358 (July 9, 2021), 86 FR 37361 (SR–
EMERALD–2021–21) (each, a ‘‘Notice’’). For ease of
reference, page citations are to the Notice for SR–
MIAX–2021–28, unless otherwise indicated.
5 15 U.S.C. 78s(b)(3)(C).
6 The proposed fee changes became effective on
July 1, 2021. See Notice, supra note 4, at 37394.
2 17
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but for each Exchange’s Strategy Book 7
(i.e., best bid and offer for a complex
strategy, with aggregate size, based on
displayable order and quoting interest
in the complex strategy on each
Exchange), plus additional information
specific to complex orders (i.e.,
identification of the complex strategies
currently trading on each Exchange,
complex strategy last sale information,
and the status of securities underlying
the complex strategy).8
The Exchanges each propose to assess
Internal Distributors 9 $1,250 per month
and External Distributors 10 $1,750 per
month for the cToM data feed.11 The
Exchanges each will assess cToM fees
on Internal and External Distributors in
each month the Distributor is
credentialed to use cToM, and will
reduce such fees for new Distributors for
the first month during which they
subscribe to cToM based on the number
of trading days that have been held
during the month prior to the date on
which that subscriber has been
credentialed to use cToM.12
7 The ‘‘Strategy Book’’ is each Exchange’s
electronic book of complex orders and complex
quotes. See MIAX and MIAX Emerald Rule
518(a)(17).
8 The Exchanges state that cToM is a distinct
market data product from ToM. They also state that
ToM subscribers are not required to subscribe to
cToM, and that cToM subscribers are not required
to subscribe to ToM. See Notice, supra note 4, at
37394.
9 A ‘‘Distributor’’ of the Exchanges’ data is any
entity that receives a feed or file of data either
directly from the Exchanges or indirectly through
another entity and then distributes it either
internally (within that entity) or externally (outside
that entity). See MIAX and MIAX Emerald Fee
Schedule, Section 6(a). All members or nonmembers that determine to receive any market data
feed from the Exchanges must first execute, among
other things, the MIAX Exchange Group Exchange
Data Agreement (‘‘Exchange Data Agreement’’). See
Notice, supra note 4, at 37395. Pursuant to the
Exchange Data Agreement, ‘‘Internal Distributors’’
are restricted to the ‘‘internal use’’ of any market
data they receive, meaning they may only distribute
the Exchanges’ market data to their officers and
employees and their affiliates. See id.
10 ‘‘External Distributors’’ may distribute the
Exchanges’ market data to persons who are not their
officers, employees, or affiliates, and may charge
their own fees for the distribution of such market
data. See Notice, supra note 4, at 37395.
11 See id. at 37394. The Exchanges also propose
to make a related change to remove ‘‘(as
applicable)’’ from the explanatory paragraph in
Section 6(a) of each Exchanges’ fee schedule, as the
Exchanges will now charge fees for both the ToM
and cToM data feeds. See id. at 37394 n.10.
12 New Distributors will be assessed a pro-rata
percentage of the fees described above, which is the
percentage of the number of trading days remaining
in the affected calendar month as of the date on
which they have been credentialed to use cToM,
divided by the total number of trading days in the
affected calendar month. See id. at 37394.
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III. Suspension of the Proposed Rule
Changes
Pursuant to Section 19(b)(3)(C) of the
Act,13 at any time within 60 days of the
date of filing of an immediately effective
proposed rule change pursuant to
Section 19(b)(1) of the Act,14 the
Commission summarily may
temporarily suspend the change in the
rules of a self-regulatory organization
(‘‘SRO’’) 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. The Commission believes a
temporary suspension of the proposed
rule changes is necessary and
appropriate to allow for additional
analysis of the proposed rule changes’
consistency with the Act and the rules
thereunder.
The Exchanges generally argue that
the proposed fees are consistent with
the Act because the Exchanges operate
in a highly competitive environment
that constrains their pricing of the cToM
feeds.15 In particular, the Exchanges
maintain that subscribing to the cToM
feeds is optional, as is the use of
complex orders themselves.16 The
Exchanges argue that because complex
orders are not protected or subject to
trade-through requirements, and
because market makers are not subject
to continuous quoting requirements for
complex orders (as they are for simple
orders), it is therefore a business
decision whether market participants
use complex order strategies on the
Exchanges and whether they purchase
cToM data to help effect those
strategies.17 Accordingly, the Exchanges
assert that if they priced their complex
data products too highly, and market
participants wanted to use those data
products to trade complex orders, then
those market participants would move
their complex order flow to a more
competitively-priced exchange offering
complex order functionality and a
comparable data product.18 The
Exchanges argue that this potential to
lose both order flow and data
subscribers on each of MIAX and/or
MIAX Emerald constrains their pricing
of the cToM feeds.19 The Exchanges also
13 15
U.S.C. 78s(b)(3)(C).
U.S.C. 78s(b)(1).
15 See Notice, supra note 4, at 37395–96. In
support, the Exchanges state that MIAX and MIAX
Emerald currently represent approximately 6.75%
and 3.24% of options market share, respectively.
See id. at 37395; Emerald Notice, supra note 4, at
37362.
16 See Notice, supra note 4, at 37395.
17 See id.
18 See id. at 37395–96.
19 See id.
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argue that the proposed fees are
reasonable because they are similar to
and generally lower than the fees
assessed by other exchanges that
provide similar data products, and that
proposing fees excessively higher would
ultimately reduce demand for the
Exchanges’ own cToM products.20
The Exchanges further argue that the
proposals are equitable and not unfairly
discriminatory because the proposed
cToM fees will apply to all market
participants of the Exchanges on a
uniform basis.21 Moreover, the
Exchanges assert that it is reasonable,
equitable, and not unfairly
discriminatory to assess Internal
Distributors fees that are lower than the
fees assessed for External Distributors
for subscriptions to the cToM data
feeds, since Internal Distributors have
limited, restricted usage rights to the
market data, as compared to External
Distributors, which have more
expansive usage rights, including rights
to commercialize such market data.22
Finally, the Exchanges assert that the
proposed fees would not cause any
unnecessary or inappropriate burden on
inter-market competition, as other
exchanges are free to introduce their
own comparable data products and
lower their prices to better compete
with the Exchanges’ offerings.23 In this
regard, the Exchanges assert that the
proposals will promote competition by
permitting the Exchanges to sell data
products similar to those offered by
other competitor options exchanges.24
The Exchanges also assert that the
proposed rule changes would not cause
any unnecessary or inappropriate
burden on intra-market competition, as
20 See id. In addition, the Exchanges state that the
proposed monthly cToM fees for Internal and
External Distributors are the same prices that the
Exchanges charge for their ToM data products. See
id. at 37396. The Exchanges also argue that the
proposed fees are reasonable because members have
had the ability to receive cToM data free of charge
from MIAX for the past five years and from MIAX
Emerald for the past two years, since each
respective cToM market data product was
established on each Exchange. See id. at 37395;
Emerald Notice, supra note 4, at 37361, 37363. The
Exchanges now assert that it is no longer necessary
to provide cToM data for free to attract market
participants, as the Exchanges’ Strategy Books are
now established and the Exchanges no longer need
to rely on such fee waivers to attract market
participants. See Notice, supra note 4, at 37394,
37396.
21 See Notice, supra note 4, at 37396.
22 See id. at 37395–96. In addition, the Exchanges
argue that they use more resources to support
External Distributors as compared to Internal
Distributors, as External Distributors have reporting
and monitoring obligations that Internal
Distributors do not have, thus requiring additional
time and effort of the Exchanges’ staff. See id. at
37396.
23 See id.
24 See id.
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the proposed fees apply uniformly to
any purchaser by not differentiating
between subscribers that purchase
cToM (other than between Internal and
External Distributors, as described
above), and are set at a modest level
allowing any interested member or nonmember to purchase such data based on
their business needs.25
When exchanges file their proposed
rule changes with the Commission,
including fee filings like the Exchanges’
present proposals, they are required to
provide a statement supporting the
proposal’s basis under the Act and the
rules and regulations thereunder
applicable to the exchange.26 The
instructions to Form 19b–4, on which
exchanges file their proposed rule
changes, specify that such statement
‘‘should be sufficiently detailed and
specific to support a finding that the
proposed rule change is consistent with
[those] requirements.’’ 27
Section 6 of the Act, including
Sections 6(b)(4), (5), and (8), require the
rules of an exchange to: (1) Provide for
the equitable allocation of reasonable
fees among members, issuers, and other
persons using the exchange’s
facilities; 28 (2) perfect the mechanism of
a free and open market and a national
market system, protect investors and the
public interest, and not be designed to
permit unfair discrimination between
customers, issuers, brokers, or
dealers; 29 and (3) not impose any
burden on competition not necessary or
appropriate in furtherance of the
purposes of the Act.30
In temporarily suspending the
Exchanges’ proposed rule changes, the
Commission intends to further consider
whether the proposals to establish fees
for the cToM market data feeds are
consistent with the statutory
requirements applicable to a national
securities exchange under the Act. In
particular, the Commission will
consider whether the proposed rule
changes satisfy the standards under the
Act and the rules thereunder requiring,
among other things, that an exchange’s
rules provide for the equitable
allocation of reasonable fees among
members, issuers, and other persons
using its facilities; not permit unfair
discrimination between customers,
issuers, brokers or dealers; and do not
impose any burden on competition not
25 See
id.
17 CFR 240.19b–4 (Item 3 entitled ‘‘SelfRegulatory Organization’s Statement of the Purpose
of, and Statutory Basis for, the Proposed Rule
Change’’).
27 See id.
28 15 U.S.C. 78f(b)(4).
29 15 U.S.C. 78f(b)(5).
30 15 U.S.C. 78f(b)(8).
26 See
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necessary or appropriate in furtherance
of the purposes of the Act.31
Therefore, the Commission finds that
it is appropriate in the public interest,
for the protection of investors, and
otherwise in furtherance of the purposes
of the Act, to temporarily suspend the
proposed rule changes.32
IV. Proceedings To Determine Whether
To Approve or Disapprove the
Proposed Rule Changes
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In addition to temporarily suspending
the proposals, the Commission also
hereby institutes proceedings pursuant
to Sections 19(b)(3)(C) 33 and 19(b)(2)(B)
of the Act 34 to determine whether the
Exchanges’ proposed rule changes
should be approved or disapproved.
Institution of proceedings does not
indicate that the Commission has
reached any conclusions with respect to
any of the issues involved. Rather, the
Commission seeks and encourages
interested persons to provide additional
comment on the proposed rule changes
to inform the Commission’s analysis of
whether to approve or disapprove the
proposed rule changes.
Pursuant to Section 19(b)(2)(B) of the
Act,35 the Commission is providing
notice of the grounds for possible
disapproval under consideration:
• Whether the Exchanges have
demonstrated how their proposed fees
are consistent with Section 6(b)(4) of the
Act, which requires that the rules of a
national securities exchange ‘‘provide
for the equitable allocation of reasonable
dues, fees, and other charges among its
members and issuers and other persons
using its facilities’’; 36
• Whether the Exchanges have
demonstrated how their proposed fees
are consistent with Section 6(b)(5) of the
Act, which requires, among other
31 See 15 U.S.C. 78f(b)(4), (5), and (8),
respectively.
32 For purposes of temporarily suspending the
proposed rule changes, the Commission has
considered the proposed rules’ impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
33 15 U.S.C. 78s(b)(3)(C). Once the Commission
temporarily suspends a proposed rule change,
Section 19(b)(3)(C) of the Act requires that the
Commission institute proceedings under Section
19(b)(2)(B) to determine whether a proposed rule
change should be approved or disapproved.
34 15 U.S.C. 78s(b)(2)(B).
35 Id. Section 19(b)(2)(B) of the Act also provides
that proceedings to determine whether to
disapprove a proposed rule change must be
concluded within 180 days of the date of
publication of notice of the filing of the proposed
rule change. See id. The time for conclusion of the
proceedings may be extended for up to 60 days if
the Commission finds good cause for such
extension and publishes its reasons for so finding,
or if the exchange consents to the longer period. See
id.
36 15 U.S.C. 78f(b)(4).
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things, that the rules of a national
securities exchange not be ‘‘designed to
permit unfair discrimination between
customers, issuers, brokers, or
dealers’’; 37 and
• Whether the Exchanges have
demonstrated how their proposed fees
are consistent with Section 6(b)(8) of the
Act, which requires that the rules of a
national securities exchange ‘‘not
impose any burden on competition not
necessary or appropriate in furtherance
of the purposes of [the Act].’’ 38
As discussed in Section III above, the
Exchanges made various arguments in
support of their proposals. The
Commission believes that there are
questions as to whether the Exchanges
have provided sufficient information to
demonstrate that the proposed fees are
consistent with the Act and the rules
thereunder.
Under the Commission’s Rules of
Practice, the ‘‘burden to demonstrate
that a proposed rule change is
consistent with the [Act] and the rules
and regulations issued thereunder . . .
is on the [SRO] that proposed the rule
change.’’ 39 The description of a
proposed rule change, its purpose and
operation, its effect, and a legal analysis
of its consistency with applicable
requirements must all be sufficiently
detailed and specific to support an
affirmative Commission finding,40 and
any failure of an SRO to provide this
information may result in the
Commission not having a sufficient
basis to make an affirmative finding that
a proposed rule change is consistent
with the Act and the applicable rules
and regulations.41
The Commission is instituting
proceedings to allow for additional
consideration and comment on the
issues raised herein, including as to
whether the proposed fees are
consistent with the Act, and
specifically, with its requirements that
exchange fees be reasonable and
equitably allocated, not be unfairly
discriminatory, and not impose any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.42
V. Commission’s Solicitation of
Comments
The Commission requests written
views, data, and arguments with respect
to the concerns identified above as well
as any other relevant concerns. Such
37 15
U.S.C. 78f(b)(5).
U.S.C. 78f(b)(8).
39 17 CFR 201.700(b)(3).
40 See id.
41 See id.
42 See 15 U.S.C. 78f(b)(4), (5), and (8).
38 15
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comments should be submitted by
September 23, 2021. Rebuttal comments
should be submitted by October 7, 2021.
Although there do not appear to be any
issues relevant to approval or
disapproval that would be facilitated by
an oral presentation of views, data, and
arguments, the Commission will
consider, pursuant to Rule 19b–4, any
request for an opportunity to make an
oral presentation.43
The Commission asks that
commenters address the sufficiency and
merit of the Exchanges’ statements in
support of the proposals, in addition to
any other comments they may wish to
submit about the proposed rule changes.
Interested persons are invited to
submit written data, views, and
arguments concerning the proposed rule
changes, including whether the
proposed rule changes are 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 No. SR–
MIAX–2021–28 or SR–EMERALD–
2021–21 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 No.
SR–MIAX–2021–28 or SR–EMERALD–
2021–21. The 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
changes that are filed with the
Commission, and all written
communications relating to the
proposed rule changes between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
43 15 U.S.C. 78s(b)(2). Section 19(b)(2) of the Act
grants the Commission flexibility to determine what
type of proceeding—either oral or notice and
opportunity for written comments—is appropriate
for consideration of a particular proposal by an
SRO. See Securities Acts Amendments of 1975,
Report of the Senate Committee on Banking,
Housing and Urban Affairs to Accompany S. 249,
S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975).
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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 Exchanges. 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 publicly available. All
submissions should refer to File No.
SR–MIAX–2021–28 or SR–EMERALD–
2021–21 and should be submitted on or
before September 23, 2021. Rebuttal
comments should be submitted by
October 7, 2021.
VI. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(3)(C) of the Act,44 that File
Nos. SR–MIAX–2021–28 and SR–
EMERALD–2021–21, be and hereby are,
temporarily suspended. In addition, the
Commission is instituting proceedings
to determine whether the proposed rule
changes should be approved or
disapproved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.45
Vanessa A. Countryman,
Secretary.
[FR Doc. 2021–18942 Filed 9–1–21; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Investment Company Act Release No.
34366]
Notice of Applications for
Deregistration Under Section 8(f) of the
Investment Company Act of 1940
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August 27, 2021.
The following is a notice of
applications for deregistration under
section 8(f) of the Investment Company
Act of 1940 for the month of August
2021. A copy of each application may be
obtained via the Commission’s website
by searching for the file number, or for
an applicant using the Company name
box, at https://www.sec.gov/search/
search.htm or by calling (202) 551–
8090. An order granting each
application will be issued unless the
SEC orders a hearing. Interested persons
44 15
45 17
U.S.C. 78s(b)(3)(C).
CFR 200.30–3(a)(57) and (58).
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may request a hearing on any
application by emailing the SEC’s
Secretary at Secretarys-Office@sec.gov
and serving the relevant applicant with
a copy of the request by email, if an
email address is listed for the relevant
applicant below, or personally or by
mail, if a physical address is listed for
the relevant applicant below. Hearing
requests should be received by the SEC
by 5:30 p.m. on September 21, 2021,
and should be accompanied by proof of
service on applicants, in the form of an
affidavit or, for lawyers, a certificate of
service. Pursuant to Rule 0–5 under the
Act, hearing requests should state the
nature of the writer’s interest, any facts
bearing upon the desirability of a
hearing on the matter, the reason for the
request, and the issues contested.
Persons who wish to be notified of a
hearing may request notification by
writing to the Commission’s Secretary at
Secretarys-Office@sec.gov.
ADDRESSES: The Commission:
Secretarys-Office@sec.gov.
FOR FURTHER INFORMATION CONTACT:
Shawn Davis, Assistant Director, at
(202) 551–6413 or Chief Counsel’s
Office at (202) 551–6821; SEC, Division
of Investment Management, Chief
Counsel’s Office, 100 F Street NE,
Washington, DC 20549–8010.
Cushing Real Income & Preferred Fund
[File No. 811–23420]
Summary: Applicant, a closed-end
investment company, seeks an order
declaring that it has ceased to be an
investment company. Applicant has
never made a public offering of its
securities and does not propose to make
a public offering or engage in business
of any kind.
Filing Dates: The application was
filed on July 16, 2021.
Applicant’s Address: Kevin.Hardy@
skadden.com.
Oppenheimer International Small-Mid
Co Fund [File No. 811–08299]
Summary: Applicant seeks an order
declaring that it has ceased to be an
investment company. The applicant has
transferred its assets to Invesco
Oppenheimer International Small-Mid
Company Fund and, on May 24, 2019,
made a final distribution to its
shareholders based on net asset value.
Expenses of $1,300,306.94 incurred in
connection with the reorganization were
paid by the applicant’s investment
adviser (or it’s affiliates) and the
acquiring fund.
Filing Dates: The application was
filed on June 11, 2021 and amended on
August 18, 2021.
Applicant’s Address:
Taylor.Edwards@invesco.com.
PO 00000
Frm 00081
Fmt 4703
Sfmt 4703
49367
Partners Group Private Income
Opportunities, LLC. [File No. 811–
23188]
Summary: Applicant, a closed-end
investment company, seeks an order
declaring that it has ceased to be an
investment company. The applicant has
transferred its assets to Partners Group
Private Equity (Master Fund), LLC., and
on December 31, 2020 made a final
distribution to its shareholders based on
net asset value. Expenses of $299,769.21
incurred in connection with the
reorganization were paid by the
applicant and the acquiring fund.
Filing Dates: The application was
filed on June 4, 2021 and amended on
August 6, 2021.
Applicant’s Address:
joshua.deringer@faegredrinker.com.
PGIM Strategic Credit Fund [File No.
811–23576]
Summary: Applicant, a closed-end
investment company, seeks an order
declaring that it has ceased to be an
investment company. Applicant has
never made a public offering of its
securities and does not propose to make
a public offering or engage in business
of any kind.
Filing Dates: The application was
filed on June 10, 2021.
Applicant’s Address: debra.rubano@
prudential.com.
For the Commission, by the Division of
Investment Management, pursuant to
delegated authority.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2021–18927 Filed 9–1–21; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–92786; File No. SR–ICEEU–
2021–010]
Self-Regulatory Organizations; ICE
Clear Europe Limited; Order Granting
Approval of Proposed Rule Change, as
Modified by Partial Amendment No. 1,
Relating to the Clearing Rules,
Clearing Procedures, Finance
Procedures, Delivery Procedures, CDS
Procedures, Membership Procedures,
Complaint Resolution Procedures, and
General Contract Terms
August 27, 2021.
I. Introduction
On May 13, 2021, ICE Clear Europe
Limited (‘‘ICE Clear Europe’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
E:\FR\FM\02SEN1.SGM
02SEN1
Agencies
[Federal Register Volume 86, Number 168 (Thursday, September 2, 2021)]
[Notices]
[Pages 49364-49367]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-18942]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-92789; File Nos. SR-MIAX-2021-28, SR-EMERALD-2021-21]
Self-Regulatory Organizations; Miami International Securities
Exchange, LLC and MIAX Emerald, LLC; Suspension of and Order
Instituting Proceedings To Determine Whether To Approve or Disapprove
Proposed Rule Changes To Establish Fees for the Exchanges' cToM Market
Data Products
August 27, 2021.
I. Introduction
On June 30, 2021, Miami International Securities Exchange, LLC
(``MIAX'') and MIAX Emerald, LLC (``MIAX Emerald'') (each, an
``Exchange,'' and collectively, the ``Exchanges'') each filed with the
Securities and Exchange Commission (``Commission''), pursuant to
Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\
and Rule 19b-4 thereunder,\2\ a proposed rule change to establish fees
for, respectively, the MIAX Complex Top of Market (``cToM'') and the
MIAX Emerald cToM market data products. The proposed rule changes were
immediately effective upon filing with the Commission pursuant to
Section 19(b)(3)(A) of the Act.\3\ The proposed rule changes were
published for comment in the Federal Register on July 15, 2021.\4\
Pursuant to Section 19(b)(3)(C) of the Act,\5\ the Commission is
hereby: (1) Temporarily suspending the proposed rule changes; and (2)
instituting proceedings to determine whether to approve or disapprove
the proposed rule changes.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A). A proposed rule change may take
effect upon filing with the Commission if it is designated by the
exchange as ``establishing or changing a due, fee, or other charge
imposed by the self-regulatory organization on any person, whether
or not the person is a member of the self-regulatory organization.''
15 U.S.C. 78s(b)(3)(A)(ii).
\4\ See Securities Exchange Act Release Nos. 92359 (July 9,
2021), 86 FR 37393 (SR-MIAX-2021-28); and 92358 (July 9, 2021), 86
FR 37361 (SR-EMERALD-2021-21) (each, a ``Notice''). For ease of
reference, page citations are to the Notice for SR-MIAX-2021-28,
unless otherwise indicated.
\5\ 15 U.S.C. 78s(b)(3)(C).
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II. Description of the Proposed Rule Changes
The Exchanges propose to establish fees for their cToM market data
products.\6\ According to the Exchanges, the cToM feed provides
subscribers with the same information as the Exchanges' respective
simple order market Top of Market (``ToM'') feeds, but for each
Exchange's Strategy Book \7\ (i.e., best bid and offer for a complex
strategy, with aggregate size, based on displayable order and quoting
interest in the complex strategy on each Exchange), plus additional
information specific to complex orders (i.e., identification of the
complex strategies currently trading on each Exchange, complex strategy
last sale information, and the status of securities underlying the
complex strategy).\8\
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\6\ The proposed fee changes became effective on July 1, 2021.
See Notice, supra note 4, at 37394.
\7\ The ``Strategy Book'' is each Exchange's electronic book of
complex orders and complex quotes. See MIAX and MIAX Emerald Rule
518(a)(17).
\8\ The Exchanges state that cToM is a distinct market data
product from ToM. They also state that ToM subscribers are not
required to subscribe to cToM, and that cToM subscribers are not
required to subscribe to ToM. See Notice, supra note 4, at 37394.
---------------------------------------------------------------------------
The Exchanges each propose to assess Internal Distributors \9\
$1,250 per month and External Distributors \10\ $1,750 per month for
the cToM data feed.\11\ The Exchanges each will assess cToM fees on
Internal and External Distributors in each month the Distributor is
credentialed to use cToM, and will reduce such fees for new
Distributors for the first month during which they subscribe to cToM
based on the number of trading days that have been held during the
month prior to the date on which that subscriber has been credentialed
to use cToM.\12\
---------------------------------------------------------------------------
\9\ A ``Distributor'' of the Exchanges' data is any entity that
receives a feed or file of data either directly from the Exchanges
or indirectly through another entity and then distributes it either
internally (within that entity) or externally (outside that entity).
See MIAX and MIAX Emerald Fee Schedule, Section 6(a). All members or
non-members that determine to receive any market data feed from the
Exchanges must first execute, among other things, the MIAX Exchange
Group Exchange Data Agreement (``Exchange Data Agreement''). See
Notice, supra note 4, at 37395. Pursuant to the Exchange Data
Agreement, ``Internal Distributors'' are restricted to the
``internal use'' of any market data they receive, meaning they may
only distribute the Exchanges' market data to their officers and
employees and their affiliates. See id.
\10\ ``External Distributors'' may distribute the Exchanges'
market data to persons who are not their officers, employees, or
affiliates, and may charge their own fees for the distribution of
such market data. See Notice, supra note 4, at 37395.
\11\ See id. at 37394. The Exchanges also propose to make a
related change to remove ``(as applicable)'' from the explanatory
paragraph in Section 6(a) of each Exchanges' fee schedule, as the
Exchanges will now charge fees for both the ToM and cToM data feeds.
See id. at 37394 n.10.
\12\ New Distributors will be assessed a pro-rata percentage of
the fees described above, which is the percentage of the number of
trading days remaining in the affected calendar month as of the date
on which they have been credentialed to use cToM, divided by the
total number of trading days in the affected calendar month. See id.
at 37394.
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[[Page 49365]]
III. Suspension of the Proposed Rule Changes
Pursuant to Section 19(b)(3)(C) of the Act,\13\ at any time within
60 days of the date of filing of an immediately effective proposed rule
change pursuant to Section 19(b)(1) of the Act,\14\ the Commission
summarily may temporarily suspend the change in the rules of a self-
regulatory organization (``SRO'') 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. The Commission believes a temporary suspension of the proposed
rule changes is necessary and appropriate to allow for additional
analysis of the proposed rule changes' consistency with the Act and the
rules thereunder.
---------------------------------------------------------------------------
\13\ 15 U.S.C. 78s(b)(3)(C).
\14\ 15 U.S.C. 78s(b)(1).
---------------------------------------------------------------------------
The Exchanges generally argue that the proposed fees are consistent
with the Act because the Exchanges operate in a highly competitive
environment that constrains their pricing of the cToM feeds.\15\ In
particular, the Exchanges maintain that subscribing to the cToM feeds
is optional, as is the use of complex orders themselves.\16\ The
Exchanges argue that because complex orders are not protected or
subject to trade-through requirements, and because market makers are
not subject to continuous quoting requirements for complex orders (as
they are for simple orders), it is therefore a business decision
whether market participants use complex order strategies on the
Exchanges and whether they purchase cToM data to help effect those
strategies.\17\ Accordingly, the Exchanges assert that if they priced
their complex data products too highly, and market participants wanted
to use those data products to trade complex orders, then those market
participants would move their complex order flow to a more
competitively-priced exchange offering complex order functionality and
a comparable data product.\18\ The Exchanges argue that this potential
to lose both order flow and data subscribers on each of MIAX and/or
MIAX Emerald constrains their pricing of the cToM feeds.\19\ The
Exchanges also argue that the proposed fees are reasonable because they
are similar to and generally lower than the fees assessed by other
exchanges that provide similar data products, and that proposing fees
excessively higher would ultimately reduce demand for the Exchanges'
own cToM products.\20\
---------------------------------------------------------------------------
\15\ See Notice, supra note 4, at 37395-96. In support, the
Exchanges state that MIAX and MIAX Emerald currently represent
approximately 6.75% and 3.24% of options market share, respectively.
See id. at 37395; Emerald Notice, supra note 4, at 37362.
\16\ See Notice, supra note 4, at 37395.
\17\ See id.
\18\ See id. at 37395-96.
\19\ See id.
\20\ See id. In addition, the Exchanges state that the proposed
monthly cToM fees for Internal and External Distributors are the
same prices that the Exchanges charge for their ToM data products.
See id. at 37396. The Exchanges also argue that the proposed fees
are reasonable because members have had the ability to receive cToM
data free of charge from MIAX for the past five years and from MIAX
Emerald for the past two years, since each respective cToM market
data product was established on each Exchange. See id. at 37395;
Emerald Notice, supra note 4, at 37361, 37363. The Exchanges now
assert that it is no longer necessary to provide cToM data for free
to attract market participants, as the Exchanges' Strategy Books are
now established and the Exchanges no longer need to rely on such fee
waivers to attract market participants. See Notice, supra note 4, at
37394, 37396.
---------------------------------------------------------------------------
The Exchanges further argue that the proposals are equitable and
not unfairly discriminatory because the proposed cToM fees will apply
to all market participants of the Exchanges on a uniform basis.\21\
Moreover, the Exchanges assert that it is reasonable, equitable, and
not unfairly discriminatory to assess Internal Distributors fees that
are lower than the fees assessed for External Distributors for
subscriptions to the cToM data feeds, since Internal Distributors have
limited, restricted usage rights to the market data, as compared to
External Distributors, which have more expansive usage rights,
including rights to commercialize such market data.\22\
---------------------------------------------------------------------------
\21\ See Notice, supra note 4, at 37396.
\22\ See id. at 37395-96. In addition, the Exchanges argue that
they use more resources to support External Distributors as compared
to Internal Distributors, as External Distributors have reporting
and monitoring obligations that Internal Distributors do not have,
thus requiring additional time and effort of the Exchanges' staff.
See id. at 37396.
---------------------------------------------------------------------------
Finally, the Exchanges assert that the proposed fees would not
cause any unnecessary or inappropriate burden on inter-market
competition, as other exchanges are free to introduce their own
comparable data products and lower their prices to better compete with
the Exchanges' offerings.\23\ In this regard, the Exchanges assert that
the proposals will promote competition by permitting the Exchanges to
sell data products similar to those offered by other competitor options
exchanges.\24\ The Exchanges also assert that the proposed rule changes
would not cause any unnecessary or inappropriate burden on intra-market
competition, as the proposed fees apply uniformly to any purchaser by
not differentiating between subscribers that purchase cToM (other than
between Internal and External Distributors, as described above), and
are set at a modest level allowing any interested member or non-member
to purchase such data based on their business needs.\25\
---------------------------------------------------------------------------
\23\ See id.
\24\ See id.
\25\ See id.
---------------------------------------------------------------------------
When exchanges file their proposed rule changes with the
Commission, including fee filings like the Exchanges' present
proposals, they are required to provide a statement supporting the
proposal's basis under the Act and the rules and regulations thereunder
applicable to the exchange.\26\ The instructions to Form 19b-4, on
which exchanges file their proposed rule changes, specify that such
statement ``should be sufficiently detailed and specific to support a
finding that the proposed rule change is consistent with [those]
requirements.'' \27\
---------------------------------------------------------------------------
\26\ See 17 CFR 240.19b-4 (Item 3 entitled ``Self-Regulatory
Organization's Statement of the Purpose of, and Statutory Basis for,
the Proposed Rule Change'').
\27\ See id.
---------------------------------------------------------------------------
Section 6 of the Act, including Sections 6(b)(4), (5), and (8),
require the rules of an exchange to: (1) Provide for the equitable
allocation of reasonable fees among members, issuers, and other persons
using the exchange's facilities; \28\ (2) perfect the mechanism of a
free and open market and a national market system, protect investors
and the public interest, and not be designed to permit unfair
discrimination between customers, issuers, brokers, or dealers; \29\
and (3) not impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act.\30\
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\28\ 15 U.S.C. 78f(b)(4).
\29\ 15 U.S.C. 78f(b)(5).
\30\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------
In temporarily suspending the Exchanges' proposed rule changes, the
Commission intends to further consider whether the proposals to
establish fees for the cToM market data feeds are consistent with the
statutory requirements applicable to a national securities exchange
under the Act. In particular, the Commission will consider whether the
proposed rule changes satisfy the standards under the Act and the rules
thereunder requiring, among other things, that an exchange's rules
provide for the equitable allocation of reasonable fees among members,
issuers, and other persons using its facilities; not permit unfair
discrimination between customers, issuers, brokers or dealers; and do
not impose any burden on competition not
[[Page 49366]]
necessary or appropriate in furtherance of the purposes of the Act.\31\
---------------------------------------------------------------------------
\31\ See 15 U.S.C. 78f(b)(4), (5), and (8), respectively.
---------------------------------------------------------------------------
Therefore, the Commission finds that it is appropriate in the
public interest, for the protection of investors, and otherwise in
furtherance of the purposes of the Act, to temporarily suspend the
proposed rule changes.\32\
---------------------------------------------------------------------------
\32\ For purposes of temporarily suspending the proposed rule
changes, the Commission has considered the proposed rules' impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------
IV. Proceedings To Determine Whether To Approve or Disapprove the
Proposed Rule Changes
In addition to temporarily suspending the proposals, the Commission
also hereby institutes proceedings pursuant to Sections 19(b)(3)(C)
\33\ and 19(b)(2)(B) of the Act \34\ to determine whether the
Exchanges' proposed rule changes should be approved or disapproved.
Institution of proceedings does not indicate that the Commission has
reached any conclusions with respect to any of the issues involved.
Rather, the Commission seeks and encourages interested persons to
provide additional comment on the proposed rule changes to inform the
Commission's analysis of whether to approve or disapprove the proposed
rule changes.
---------------------------------------------------------------------------
\33\ 15 U.S.C. 78s(b)(3)(C). Once the Commission temporarily
suspends a proposed rule change, Section 19(b)(3)(C) of the Act
requires that the Commission institute proceedings under Section
19(b)(2)(B) to determine whether a proposed rule change should be
approved or disapproved.
\34\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------
Pursuant to Section 19(b)(2)(B) of the Act,\35\ the Commission is
providing notice of the grounds for possible disapproval under
consideration:
---------------------------------------------------------------------------
\35\ Id. Section 19(b)(2)(B) of the Act also provides that
proceedings to determine whether to disapprove a proposed rule
change must be concluded within 180 days of the date of publication
of notice of the filing of the proposed rule change. See id. The
time for conclusion of the proceedings may be extended for up to 60
days if the Commission finds good cause for such extension and
publishes its reasons for so finding, or if the exchange consents to
the longer period. See id.
---------------------------------------------------------------------------
Whether the Exchanges have demonstrated how their proposed
fees are consistent with Section 6(b)(4) of the Act, which requires
that the rules of a national securities exchange ``provide for the
equitable allocation of reasonable dues, fees, and other charges among
its members and issuers and other persons using its facilities''; \36\
---------------------------------------------------------------------------
\36\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
Whether the Exchanges have demonstrated how their proposed
fees are consistent with Section 6(b)(5) of the Act, which requires,
among other things, that the rules of a national securities exchange
not be ``designed to permit unfair discrimination between customers,
issuers, brokers, or dealers''; \37\ and
---------------------------------------------------------------------------
\37\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
Whether the Exchanges have demonstrated how their proposed
fees are consistent with Section 6(b)(8) of the Act, which requires
that the rules of a national securities exchange ``not impose any
burden on competition not necessary or appropriate in furtherance of
the purposes of [the Act].'' \38\
---------------------------------------------------------------------------
\38\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------
As discussed in Section III above, the Exchanges made various
arguments in support of their proposals. The Commission believes that
there are questions as to whether the Exchanges have provided
sufficient information to demonstrate that the proposed fees are
consistent with the Act and the rules thereunder.
Under the Commission's Rules of Practice, the ``burden to
demonstrate that a proposed rule change is consistent with the [Act]
and the rules and regulations issued thereunder . . . is on the [SRO]
that proposed the rule change.'' \39\ The description of a proposed
rule change, its purpose and operation, its effect, and a legal
analysis of its consistency with applicable requirements must all be
sufficiently detailed and specific to support an affirmative Commission
finding,\40\ and any failure of an SRO to provide this information may
result in the Commission not having a sufficient basis to make an
affirmative finding that a proposed rule change is consistent with the
Act and the applicable rules and regulations.\41\
---------------------------------------------------------------------------
\39\ 17 CFR 201.700(b)(3).
\40\ See id.
\41\ See id.
---------------------------------------------------------------------------
The Commission is instituting proceedings to allow for additional
consideration and comment on the issues raised herein, including as to
whether the proposed fees are consistent with the Act, and
specifically, with its requirements that exchange fees be reasonable
and equitably allocated, not be unfairly discriminatory, and not impose
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.\42\
---------------------------------------------------------------------------
\42\ See 15 U.S.C. 78f(b)(4), (5), and (8).
---------------------------------------------------------------------------
V. Commission's Solicitation of Comments
The Commission requests written views, data, and arguments with
respect to the concerns identified above as well as any other relevant
concerns. Such comments should be submitted by September 23, 2021.
Rebuttal comments should be submitted by October 7, 2021. Although
there do not appear to be any issues relevant to approval or
disapproval that would be facilitated by an oral presentation of views,
data, and arguments, the Commission will consider, pursuant to Rule
19b-4, any request for an opportunity to make an oral presentation.\43\
---------------------------------------------------------------------------
\43\ 15 U.S.C. 78s(b)(2). Section 19(b)(2) of the Act grants the
Commission flexibility to determine what type of proceeding--either
oral or notice and opportunity for written comments--is appropriate
for consideration of a particular proposal by an SRO. See Securities
Acts Amendments of 1975, Report of the Senate Committee on Banking,
Housing and Urban Affairs to Accompany S. 249, S. Rep. No. 75, 94th
Cong., 1st Sess. 30 (1975).
---------------------------------------------------------------------------
The Commission asks that commenters address the sufficiency and
merit of the Exchanges' statements in support of the proposals, in
addition to any other comments they may wish to submit about the
proposed rule changes.
Interested persons are invited to submit written data, views, and
arguments concerning the proposed rule changes, including whether the
proposed rule changes are 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 No. SR-MIAX-2021-28 or SR-EMERALD-2021-21 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 No. SR-MIAX-2021-28 or SR-EMERALD-
2021-21. The 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 changes that
are filed with the Commission, and all written communications relating
to the proposed rule changes between the Commission and any person,
other than those that may be withheld from the public in accordance
with the
[[Page 49367]]
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 Exchanges.
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 publicly available. All
submissions should refer to File No. SR-MIAX-2021-28 or SR-EMERALD-
2021-21 and should be submitted on or before September 23, 2021.
Rebuttal comments should be submitted by October 7, 2021.
VI. Conclusion
It is therefore ordered, pursuant to Section 19(b)(3)(C) of the
Act,\44\ that File Nos. SR-MIAX-2021-28 and SR-EMERALD-2021-21, be and
hereby are, temporarily suspended. In addition, the Commission is
instituting proceedings to determine whether the proposed rule changes
should be approved or disapproved.
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\44\ 15 U.S.C. 78s(b)(3)(C).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\45\
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\45\ 17 CFR 200.30-3(a)(57) and (58).
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Vanessa A. Countryman,
Secretary.
[FR Doc. 2021-18942 Filed 9-1-21; 8:45 am]
BILLING CODE 8011-01-P