Self-Regulatory Organizations: Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by MIAX PEARL, LLC To Amend the MIAX Pearl Options Fee Schedule, 58843-58848 [2022-20952]
Download as PDF
<![CDATA[
Federal Register / Vol. 87, No. 187 / Wednesday, September 28, 2022 / Notices
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days after the date of
the filing, or such shorter time as the
Commission may designate, it has
become effective pursuant to 19(b)(3)(A)
of the Act 27 and Rule 19b–4(f)(6) 28
thereunder.
A proposed rule change filed under
Rule 19b–4(f)(6) 29 normally does not
become operative prior to 30 days after
the date of the filing. However, Rule
19b–4(f)(6)(iii) 30 permits the
Commission to designate a shorter time
if such action is consistent with the
protection of investors and the public
interest. The Exchange has asked the
Commission to waive the 30-day
operative delay so that the proposed
rule change may become operative on
October 1, 2022. The Commission
believes that waiving the 30-day
operative delay is consistent with the
protection of investors and the public
interest, as it will allow the Exchange to
coordinate its implementation of the
revised clearly erroneous execution
rules with the other national securities
exchanges and FINRA, and will help
ensure consistency across the SROs.31
For this reason, the Commission hereby
waives the 30-day operative delay and
designates the proposed rule change as
operative upon filing.32
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.
27 15
U.S.C. 78s(b)(3)(A).
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.
29 17 CFR 240.19b–4(f)(6).
30 17 CFR 240.19b–4(f)(6)(iii).
31 See SR–CboeBZX–2022–37 (July 8, 2022).
32 For purposes only of waiving the 30-day
operative delay, the Commission has also
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
lotter on DSK11XQN23PROD with NOTICES1
28 17
VerDate Sep<11>2014
18:06 Sep 27, 2022
Jkt 256001
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:
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
PEARL–2022–41 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–PEARL–2022–41. This file
number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–PEARL–2022–41 and
should be submitted on or before
October 19, 2022.
Frm 00080
Fmt 4703
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.33
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022–20955 Filed 9–27–22; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Electronic Comments
PO 00000
58843
Sfmt 4703
[Release No. 34–95886; File No. SR–
PEARL–2022–40]
Self-Regulatory Organizations: Notice
of Filing and Immediate Effectiveness
of a Proposed Rule Change by MIAX
PEARL, LLC To Amend the MIAX Pearl
Options Fee Schedule
September 22, 2022.
Pursuant to the provisions of 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 September 14, 2022, MIAX PEARL,
LLC (‘‘MIAX Pearl’’ or ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’) a
proposed rule change as described in
Items I, II, and III 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is filing a proposal to
amend the MIAX Pearl Options Fee
Schedule (the ‘‘Fee Schedule’’).
The text of the proposed rule change
is available on the Exchange’s website at
https://www.miaxoptions.com/rulefilings/pearl at MIAX Pearl’s principal
office, and at the Commission’s Public
Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
33 17
CFR 200.30–3(a)(12).
15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1
E:\FR\FM\28SEN1.SGM
28SEN1
58844
Federal Register / Vol. 87, No. 187 / Wednesday, September 28, 2022 / Notices
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
Add/Remove Tiered Rebates/Fees set
forth in Section 1(a) of the Fee Schedule
to: (1) modify the Maker rebates
(defined below) in all Tiers for
transactions in Penny Classes (defined
below) for MIAX Pearl Market Makers,3
Non-Priority Customers, Firms, BrokerDealers and Non-MIAX Pearl Market
Makers; and (2) provide for additional,
separate Maker rebates for Market
Makers and Electronic Exchange
Member (‘‘EEM’’) 4 Professional origins
(defined below) for certain transactions
in Non-Penny Classes (defined below).
The Exchange originally filed this
proposal on September 1, 2022 (SR–
PEARL–2022–38). On September 14,
2022, the Exchange withdrew SR–
PEARL–2022–38 and resubmitted this
proposal.
lotter on DSK11XQN23PROD with NOTICES1
Background
The Exchange currently assesses
transaction rebates and fees to all
market participants which are based
upon the total monthly volume
executed by the Member 5 on MIAX
Pearl in the relevant, respective origin
type (not including Excluded
Contracts) 6 (as the numerator)
expressed as a percentage of (divided
by) TCV 7 (as the denominator). In
3 ‘‘Market Maker’’ means a Member registered
with the Exchange for the purpose of making
markets in options contracts traded on the
Exchange and that is vested with the rights and
responsibilities specified in Chapter VI of Exchange
Rules. See the Definitions Section of the Fee
Schedule and Exchange Rule 100.
4 ‘‘Electronic Exchange Member’’ or ‘‘EEM’’
means the holder of a Trading Permit who is a
Member representing as agent Public Customer
Orders or Non-Customer Orders on the Exchange
and those non-Market Maker Members conducting
proprietary trading. Electronic Exchange Members
are deemed ‘‘members’’ under the Exchange Act.
See the Definitions Section of the Fee Schedule and
Exchange Rule 100.
5 ‘‘Member’’ means an individual or organization
that is registered with the Exchange pursuant to
Chapter II of Exchange Rules for purposes of trading
on the Exchange as an ‘‘Electronic Exchange
Member’’ or ‘‘Market Maker.’’ Members are deemed
‘‘members’’ under the Exchange Act. See the
Definitions Section of the Fee Schedule and
Exchange Rule 100.
6 ‘‘Excluded Contracts’’ means any contracts
routed to an away market for execution. See the
Definitions Section of the Fee Schedule.
7 ‘‘TCV’’ means total consolidated volume
calculated as the total national volume in those
classes listed on MIAX PEARL for the month for
which the fees apply, excluding consolidated
volume executed during the period time in which
VerDate Sep<11>2014
18:06 Sep 27, 2022
Jkt 256001
addition, the per contract transaction
rebates and fees are applied
retroactively to all eligible volume for
that origin type once the respective
threshold tier (‘‘Tier’’) has been reached
by the Member. The Exchange
aggregates the volume of Members and
their Affiliates.8 Members that place
the Exchange experiences an ‘‘Exchange System
Disruption’’ (solely in the option classes of the
affected Matching Engine (as defined below)). The
term Exchange System Disruption, which is defined
in the Definitions section of the Fee Schedule,
means an outage of a Matching Engine or collective
Matching Engines for a period of two consecutive
hours or more, during trading hours. The term
Matching Engine, which is also defined in the
Definitions section of the Fee Schedule, is a part of
the MIAX PEARL electronic system that processes
options orders and trades on a symbol-by-symbol
basis. Some Matching Engines will process option
classes with multiple root symbols, and other
Matching Engines may be dedicated to one single
option root symbol (for example, options on SPY
may be processed by one single Matching Engine
that is dedicated only to SPY). A particular root
symbol may only be assigned to a single designated
Matching Engine. A particular root symbol may not
be assigned to multiple Matching Engines. The
Exchange believes that it is reasonable and
appropriate to select two consecutive hours as the
amount of time necessary to constitute an Exchange
System Disruption, as two hours equates to
approximately 1.4% of available trading time per
month. The Exchange notes that the term
‘‘Exchange System Disruption’’ and its meaning
have no applicability outside of the Fee Schedule,
as it is used solely for purposes of calculating
volume for the threshold tiers in the Fee Schedule.
See the Definitions Section of the Fee Schedule.
8 ‘‘Affiliate’’ means (i) an affiliate of a Member of
at least 75% common ownership between the firms
as reflected on each firm’s Form BD, Schedule A,
or (ii) the Appointed Market Maker of an Appointed
EEM (or, conversely, the Appointed EEM of an
Appointed Market Maker). An ‘‘Appointed Market
Maker’’ is a MIAX PEARL Market Maker (who does
not otherwise have a corporate affiliation based
upon common ownership with an EEM) that has
been appointed by an EEM and an ‘‘Appointed
EEM’’ is an EEM (who does not otherwise have a
corporate affiliation based upon common
ownership with a MIAX PEARL Market Maker) that
has been appointed by a MIAX PEARL Market
Maker, pursuant to the following process. A MIAX
PEARL Market Maker appoints an EEM and an EEM
appoints a MIAX PEARL Market Maker, for the
purposes of the Fee Schedule, by each completing
and sending an executed Volume Aggregation
Request Form by email to membership@
miaxoptions.com no later than 2 business days
prior to the first business day of the month in which
the designation is to become effective. Transmittal
of a validly completed and executed form to the
Exchange along with the Exchange’s
acknowledgement of the effective designation to
each of the Market Maker and EEM will be viewed
as acceptance of the appointment. The Exchange
will only recognize one designation per Member. A
Member may make a designation not more than
once every 12 months (from the date of its most
recent designation), which designation shall remain
in effect unless or until the Exchange receives
written notice submitted 2 business days prior to
the first business day of the month from either
Member indicating that the appointment has been
terminated. Designations will become operative on
the first business day of the effective month and
may not be terminated prior to the end of the
month. Execution data and reports will be provided
to both parties. See the Definitions Section of the
Fee Schedule.
PO 00000
Frm 00081
Fmt 4703
Sfmt 4703
resting liquidity, i.e., orders resting on
the book of the MIAX Pearl System,9 are
paid the specified ‘‘maker’’ rebate (each
a ‘‘Maker’’), and Members that execute
against resting liquidity are assessed the
specified ‘‘taker’’ fee (each a ‘‘Taker’’).
For opening transactions and ABBO 10
uncrossing transactions, per contract
transaction rebates and fees are waived
for all market participants. Finally,
Members are assessed lower transaction
fees and receive lower rebates for order
executions in standard option classes in
the Penny Interval Program 11 (‘‘Penny
Classes’’) than for order executions in
standard option classes which are not in
the Penny Interval Program (‘‘NonPenny Classes’’), where Members are
assessed higher transaction fees and
receive higher rebates.
Proposal To Modify the Maker Rebates
in All Tiers for Transactions in Penny
Classes for Market Makers and NonPriority Customer, Firm, BD and NonMIAX Pearl Market Maker Origins
The Exchange proposes to amend the
Fee Schedule for the Exchange’s options
market to modify the Maker rebates in
all Tiers for options transactions in
Penny Classes for Market Makers and
Non-Priority Customer, Firm, BD and
Non-MIAX Pearl Market Maker origins’
respective rate tables. Currently, the
Exchange provides different Maker
rebates for options transactions in
Penny Classes for Market Makers and
Non-Priority Customer, Firm, BD and
Non-MIAX Pearl Market Maker origins
depending on whether the Member is
trading against the Priority Customer 12
origin or another origin type. In
particular, the Exchange provides the
following Maker rebates for Market
Makers for options transactions in
Penny Classes when trading against the
Priority Customer origin: ($0.23) in Tier
1, ($0.38) in Tier 2, ($0.38) in Tier 3,
($0.45) in Tier 4, ($0.46) in Tier 5, and
9 The term ‘‘System’’ means the automated
trading system used by the Exchange for the trading
of securities. See Exchange Rule 100.
10 ‘‘ABBO’’ means the best bid(s) or offer(s)
disseminated by other Eligible Exchanges (defined
in Exchange Rule 1400(g)) and calculated by the
Exchange based on market information received by
the Exchange from OPRA. See the Definitions
Section of the Fee Schedule and Exchange Rule
100.
11 See Securities Exchange Act Release No. 88992
(June 2, 2020), 85 FR 35142 (June 8, 2020) (SR–
PEARL–2020–06).
12 The term ‘‘Priority Customer’’ means a person
or entity that (i) is not a broker or dealer in
securities, and (ii) does not place more than 390
orders in listed options per day on average during
a calendar month for its own beneficial accounts(s).
The number of orders shall be counted in
accordance with Interpretation and Policy .01 of
Exchange Rule 100. See the Definitions Section of
the Fee Schedule and Exchange Rule 100, including
Interpretation and Policy .01.
E:\FR\FM\28SEN1.SGM
28SEN1
Federal Register / Vol. 87, No. 187 / Wednesday, September 28, 2022 / Notices
lotter on DSK11XQN23PROD with NOTICES1
($0.47) in Tier 6. The Exchange provides
the following Maker rebates for NonPriority Customer, Firm, BD and NonMIAX Pearl Market Maker origins for
options transactions in Penny Classes
when trading against the Priority
Customer origin: ($0.23) in Tier 1,
($0.38) in Tier 2, ($0.38) in Tier 3,
($0.45) in Tier 4, ($0.46) in Tier 5, and
($0.46) in Tier 6.
The Exchange now proposes to lower
the Maker rebates by $0.01 in all Tiers
for options transactions in Penny
Classes for Market Makers and NonPriority Customer, Firm, BD and NonMIAX Pearl Market Maker origins,
respectively, when trading against the
Priority Customer origin. Accordingly,
with the proposed changes, the
Exchange will provide the following
Maker rebates for Market Makers for
options transactions in Penny Classes
when trading against the Priority
Customer origin: ($0.22) in Tier 1,
($0.37) in Tier 2, ($0.37) in Tier 3,
($0.44) in Tier 4, ($0.45) in Tier 5, and
($0.46) in Tier 6. The Exchange will
provide the following Maker rebates for
Non-Priority Customer, Firm, BD and
Non-MIAX Pearl Market Maker origins
for options transactions in Penny
Classes when trading against the
Priority Customer origin: ($0.22) in Tier
1, ($0.37) in Tier 2, ($0.37) in Tier 3,
($0.44) in Tier 4, ($0.45) in Tier 5, and
($0.45) in Tier 6.
The purpose of adjusting the specified
Maker rebates is for business and
competitive reasons. In order to attract
order flow, the Exchange initially set its
Maker rebates so that they were higher
than other options exchanges that
operate comparable maker/taker pricing
models.13 The Exchange believes that it
is appropriate to adjust these specified
Maker rebates so that they are more in
line with other exchanges, but will
remain highly competitive such that
they should enable the Exchange to
continue to attract order flow and
maintain market share.14
13 See Securities Exchange Act Release Nos.
80061 (February 17, 2017), 82 FR 11676 (February
24, 2017) (SR–PEARL–2017–10) (establishing the
Exchange’s fee schedule with Market Maker and
Professional Member Maker Penny Class rebates
ranging from ($0.25) in Tier 1 to ($0.48) in Tier 4,
the highest Tier at that time).
14 See, generally, The Nasdaq Stock Market,
Options 7 Pricing Schedule, Section 2 (Market
Maker and Professional Member rebates ranging
from $0.20 in Tier 1 to $0.48 in Tier 6); Box Options
Fee Schedule, Section IV. Electronic Transaction
Fees, Section A (Market Maker rebate of $0.50 when
trading contra to a BOX Public Customer for options
transactions in Penny Classes); Cboe BZX Options
Fee Schedule, Standard Rates (Market Maker
rebates for Penny Class securities ranging from
$0.29 to $0.46 for adding liquidity; Professional
rebates for Penny Class securities ranging from
$0.25 to $0.48 for adding liquidity; and Firm,
VerDate Sep<11>2014
18:06 Sep 27, 2022
Jkt 256001
Proposal To Adopt Additional, Separate
Maker Rebates for Market Makers and
Non-Priority Customer, Firm, BD and
Non-MIAX Pearl Market Maker Origins
for Certain Transactions in Non-Penny
Classes
The Exchange proposes to amend the
Fee Schedule for the Exchange’s options
market to adopt additional separate
Maker rebates for Market Makers and
Non-Priority Customer, Firm, BD and
Non-MIAX Pearl Market Maker origins
for options transactions in Non-Penny
Classes in Tiers 1 through 4. Currently,
the Exchange provides the following
Maker rebates for Market Makers and
Non-Priority Customer, Firm, BD and
Non-MIAX Pearl Market Maker origins
for options transactions in Non-Penny
Classes: ($0.30) in Tier 1, ($0.30) in Tier
2, ($0.60) in Tier 3, ($0.65) in Tier 4,
($0.70) in Tier 5, and ($0.85) in Tier 6.15
The Exchange now proposes to adopt
additional, separate Maker rebates for
Market Makers for options transactions
in Non-Penny Classes in Tiers 1 through
4. In particular, the Exchange proposes
that Market Makers may qualify for
additional, separate rebates for options
transactions in Non-Penny classes in
Tiers 1 through 4 if the Market Maker
increases their Non-Penny Class Maker
TCV by 100% or more as compared to
that Market Maker’s Non-Penny Class
TCV for the month of July 2022,16 which
will be the Market Maker’s baseline
Non-Penny Class Maker TCV. Market
Makers that qualify for the additional
Non-Penny Class Maker rebate will
receive the following additional,
separate rebates: ($0.40) in Tier 1;
($0.40) in Tier 2; ($0.10) in Tier 3; and
($0.05) in Tier 4. Market Makers with no
volume in the Non-Penny Class Maker
segment for the month of July 2022 will
have any new volume considered as
Broker-Dealer, Joint Back Office rebates for Penny
Class securities ranging from $0.25 to $0.46 for
adding liquidity).
15 The Exchange notes that the current Maker
rebates for Market Makers and Non-Priority
Customer, Firm, BD and Non-MIAX Pearl Market
Maker origins for options transactions in NonPenny Classes are similar to non-penny class maker
rebates for similar origins at competing options
exchanges. See, e.g., NYSE Arca Options Fee
Schedule, Non-Customer, Non-Penny Posting Credit
Tiers, Page 8 (providing base non-customer, nonpenny maker rebates ranging from ($0.32) to
($0.82)); Cboe BZX Options Fee Schedule, Standard
Rates (providing firm, broker dealer and joint back
office non-penny program securities maker rebates
ranging from ($0.30) to ($0.82) and market maker
non-penny program securities maker rebates
ranging from ($0.40) to ($0.88)).
16 The Exchange determined to use the month of
July 2022 as the baseline month because, at the time
of the original filing (SR–PEARL–2022–38), July
was the most recent previous full month of trading.
For purposes of consistency with the original filing,
the Exchange proposes to continue to use the month
of July 2022 as the baseline month.
PO 00000
Frm 00082
Fmt 4703
Sfmt 4703
58845
added volume. Stated another way, the
Exchange proposes that Market Makers
who did not have any volume in the
Non-Penny Class Maker segment for the
month of July 2022, will receive the
proposed additional separate Maker
rebates for any new Non-Penny Class
Maker volume in each subsequent
month. The Exchange proposes to
denote the additional Maker rebates in
Non-Penny Classes for Market Makers
by adopting new footnote ‘‘■’’ following
the tables of fees and rebates in Section
1)a) of the Fee Schedule. For example,
if a Market Maker has specific NonPenny Class Maker volume of 0.050%
TCV for the month of July 2022, then
that Market Maker would need NonPenny Class Maker volume equal to or
greater than 0.100% TCV in the relevant
month to receive the additional
proposed rebates. The purpose of this
change is for business and competitive
reasons in order to attract additional
Non-Penny Class volume from Market
Makers, which should benefit all
Exchange participants by providing
more trading opportunities and tighter
spreads.17
The Exchange also proposes to adopt
an additional, separate Maker rebate for
EEM Professional origins (which
includes, collectively, Non-Priority
Customer, Firm, BD and Non-MIAX
Pearl Market Maker origins), for options
transactions in Non-Penny Classes in
Tiers 1 through 4. In particular, the
Exchange proposes that EEMs may
qualify for additional separate rebates
for options transactions in Non-Penny
classes in Tiers 1 through 4 if the EEM
increases their Professional origin NonPenny Class Maker TCV by 100% or
more as compared to that EEM’s
Professional origin Non-Penny Class
TCV for the month of July 2022,18 which
will be EEM’s Professional origin
baseline Non-Penny Class Maker TCV.
EEMs that qualify for the additional
Non-Penny Class Maker rebate will
17 See supra note 15. The Exchange notes that
NYSE American, LLC has a similar ‘‘step-up’’
incentive for its Professional Customer, Broker
Dealer, Non-NYSE American Options Market Maker
and Firm ranges, whereby those market participants
are able to decrease their fees for transactions in
non-penny classes by increasing their volume by
specified percentages of TCADV over their August
2019 volume. See NYSE American Options Fee
Schedule, Section I.A. and Section I.H. (charging an
$0.85 fee to Professional Customer, Broker Dealer,
Non-NYSE American Options Market Maker and
Firm ranges for transactions in non-penny classes
and decreased fees of either $0.65 or $0.55 for
transactions in on-penny classes depending on the
amount of increased volume by specified
percentages of TCADV over their August 2019
volume). See id., Key Terms and Definitions Section
for definitions of Professional Customer, Broker
Dealer, Non-NYSE American Options Market
Maker, Firm and TCADV.
18 See supra note 16.
E:\FR\FM\28SEN1.SGM
28SEN1
58846
Federal Register / Vol. 87, No. 187 / Wednesday, September 28, 2022 / Notices
receive the following additional,
separate rebates: ($0.40) in Tier 1;
($0.40) in Tier 2; ($0.10) in Tier 3; and
($0.05) in Tier 4.19 EEMs with no
Professional origin volume in the NonPenny Class Maker segment for the
month of July 2022 will have any new
volume considered as added volume.
Stated another way, the Exchange
proposes that EEM Professional origins
that did not have any volume in the
Non-Penny Class Maker segment for the
month of July 2022, will receive the
proposed additional separate Maker
rebates for any new Non-Penny Class
Maker volume in each subsequent
month. The Exchange proposes to
denote the additional Maker rebates in
Non-Penny Classes for EEMs by
adopting new footnote ‘‘b’’ following
the tables of fees and rebates in Section
1)a) of the Fee Schedule. For example,
if an EEM has specific Professional
origin Non-Penny Class Maker volume
of 0.050% TCV for the month of July
2022, then that EEM would need
Professional origin Non-Penny Class
Maker volume equal to or greater than
0.100% TCV in the relevant month to
receive the additional proposed rebates.
The purpose of this change is for
business and competitive reasons in
order to attract additional Non-Penny
Class volume from EEMs, which should
benefit all Exchange participants by
providing more trading opportunities
and tighter spreads.20
Implementation
The proposed changes are
immediately effective.
lotter on DSK11XQN23PROD with NOTICES1
2. Statutory Basis
The Exchange believes that its
proposal to amend its Fee Schedule is
consistent with Section 6(b) of the Act 21
in general, and furthers the objectives of
Section 6(b)(4) of the Act,22 in that it is
an equitable allocation of reasonable
dues, fees and other charges among
Exchange members and issuers and
other persons using its facilities, and
6(b)(5) of the Act,23 in that it is designed
to prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, to foster
cooperation and coordination with
persons engaged in facilitating
19 With the proposed additional rebates, the
Exchange’s Non-Penny Class Maker rebates in Tiers
1 through 4 for Market Makers and EEM
Professional origins will be in line with, or higher
than (for lower tiers), similar rebates from
competing options exchanges depending on the tier
achieved by the particular member. See supra note
15.
20 See supra notes 15 and 17.
21 15 U.S.C. 78f(b).
22 15 U.S.C. 78f(b)(4).
23 15 U.S.C. 78f(b)(1) and (b)(5).
VerDate Sep<11>2014
18:06 Sep 27, 2022
Jkt 256001
transactions in securities, to remove
impediments to and perfect the
mechanisms of a free and open market
and a national market system and, in
general, to protect investors and the
public interest.
The Commission has repeatedly
expressed its preference for competition
over regulatory intervention in
determining prices, products, and
services in the securities markets. In
Regulation NMS, the Commission
highlighted the importance of market
forces in determining prices and SRO
revenues and, also, recognized that
current regulation of the market system
‘‘has been remarkably successful in
promoting market competition in its
broader forms that are most important to
investors and listed companies.’’ 24
There are currently 16 registered
options exchanges competing for order
flow. Based on publicly-available
information, and excluding index-based
options, as of September 13, 2022, no
single exchange has more than
approximately 11–13% equity options
market share for the month of
September 2022.25 Therefore, no
exchange possesses significant pricing
power. More specifically, as of
September 13, 2022, the Exchange has a
market share of approximately 4.34% of
executed volume of multiply-listed
equity options for the month of
September 2022.26
The Exchange believes that the evershifting market share among the
exchanges from month to month
demonstrates that market participants
can discontinue or reduce use of certain
categories of products and services,
terminate an existing membership or
determine to not become a new member,
and/or shift order flow, in response to
transaction fee changes. For example, on
February 28, 2019, the Exchange filed
with the Commission a proposal to
increase Taker fees in certain Tiers for
options transactions in certain Penny
classes for Priority Customers and
decrease Maker rebates in certain Tiers
for options transactions in Penny classes
for Priority Customers (which fee was to
be effective March 1, 2019).27 The
Exchange experienced a decrease in
total market share for the month of
March 2019, after the proposal went
into effect. Accordingly, the Exchange
believes that its March 1, 2019, fee
24 See Securities Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496 (June 29, 2005).
25 See ‘‘The market at a glance,’’ (last visited
September 13, 2022), available at https://
www.miaxoptions.com/.
26 See id.
27 See Securities Exchange Act Release No. 85304
(March 13, 2019), 84 FR 10144 (March 19, 2019)
(SR–PEARL–2019–07).
PO 00000
Frm 00083
Fmt 4703
Sfmt 4703
change, to increase certain transaction
fees and decrease certain transaction
rebates, may have contributed to the
decrease in MIAX Pearl’s market share
and, as such, the Exchange believes
competitive forces constrain the
Exchange’s, and other options
exchanges, ability to set transaction fees
and market participants can shift order
flow based on fee changes instituted by
the exchanges.
The Exchange believes its proposal to
modify the Maker rebates in all Tiers for
options transactions in Penny classes for
Market Makers and Non-Priority
Customer, Firm, BD and Non-MIAX
Pearl Market Maker origins when
trading against Priority Customer origin
is reasonable, equitable and not unfairly
discriminatory because all similarly
situated market participants in the same
origin type are subject to the same tiered
Maker rebates and access to the
Exchange is offered on terms that are
not unfairly discriminatory. For
competitive and business reasons, the
Exchange initially set its Maker rebates
for such orders generally higher than
certain other options exchanges that
operate comparable maker/taker pricing
models. The Exchange now believes that
it is appropriate to modify those
specified Maker rebates so that they are
more in line with other exchanges, and
will remain highly competitive such
that they should enable the Exchange to
continue to attract order flow and
maintain market share.28
The Exchange believes its proposal is
not unfairly discriminatory because,
with the proposed changes, the Maker
rebates for Market Makers and NonPriority Customer, Firm, BD and NonMIAX Pearl Market Maker origins will
be nearly the same as the Maker rebates
for all other origin types except for
Priority Customer origin orders. The
Exchange believes that it is equitable
and not unfairly discriminatory to
assess lower Maker rebates to Market
Makers and EEM Professional origins
than to Priority Customer origin orders.
A Priority Customer is by definition not
a broker or dealer in securities, and does
not place more than 390 orders in listed
options per day on average during a
calendar month for its own beneficial
account(s).29 This limitation does not
apply to participants on the Exchange
whose behavior is substantially similar
to that of market professionals,
including non-Priority Customers, NonMIAX Pearl Market Makers, Firms, and
Broker-Dealers, who will generally
submit a higher number of orders (many
28
29
See supra note 14.
See supra note 12.
E:\FR\FM\28SEN1.SGM
28SEN1
lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 87, No. 187 / Wednesday, September 28, 2022 / Notices
of which do not result in executions)
than Priority Customers.
The Exchange believes its proposal to
adopt additional, separate Maker rebates
for options transactions in Non-Penny
Classes in Tiers 1 through 4 for Market
Makers and EEM Professional origins is
reasonable, equitable and not unfairly
discriminatory because all similarly
situated market participants in the same
origin type are subject to the same tiered
Maker rebates and access to the
Exchange is offered on terms that are
not unfairly discriminatory. The
Exchange believes its proposal to offer
an additional Non-Penny Class Maker
rebates in Tiers 1 through 4 for Market
Makers and EEM Professional origins
will incentivize Market Makers and
EEMs to improve their posted liquidity
to the benefit of the entire market,
which will increase order flow sent to
the Exchange, benefiting all market
participants through increased liquidity,
tighter markets and order interaction.
The Exchange believes it is reasonable
and not unfairly discriminatory to offer
higher additional Non-Penny Class
Maker rebates for Tiers 1 and 2, as
compared to Tiers 3 and 4, because the
Exchange believes that the prospect of
obtaining the higher rebates for Tiers 1
and 2 will attract Non-Penny Class
Maker volume from new market
participants. This anticipated new NonPenny Class Maker volume should
benefit all Exchange participants by
providing more trading opportunities
and tighter spreads. Further, with the
proposed additional rebates, the
Exchange’s Non-Penny Class Maker
rebates in Tiers 1 through 4 for Market
Makers and EEM Professional origins
will be in line with, or higher than (for
Tiers 1 and 2) similar rebates from
competing options exchanges.30
The Exchange believes it is
reasonable, equitable and not unfairly
discriminatory to consider any new
Non-Penny Class Maker volume as
added volume for Market Makers with
no volume in the Non-Penny Class
Maker segment for the month of July
2022 in order for those Market Makers
to receive the proposed additional
rebate because this should attract
additional Non-Penny Class Maker
volume from Market Makers. In turn,
this additional volume should benefit
all Exchange participants by providing
more trading opportunities and tighter
spreads. Similarly, the Exchange
believes it is reasonable, equitable and
not unfairly discriminatory to consider
any new Non-Penny Class Maker
volume as added volume for EEMs with
no Professional origin volume in the
30
18:06 Sep 27, 2022
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule changes will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act. The
Exchange believes that the proposed
changes in the Maker rebates for the
applicable market participants should
continue to encourage the provision of
liquidity that enhances the quality of
the Exchange’s market and increases the
number of trading opportunities on the
Exchange for all participants who will
be able to compete for such
opportunities. The proposed rule
changes should enable the Exchange to
continue to attract and compete for
order flow with other exchanges.
However, this competition does not
create an undue burden on competition
but rather offers all market participants
the opportunity to receive the benefit of
competitive pricing.
The proposed Maker rebate
adjustments are intended to keep the
Exchange’s rebates highly competitive
with those of other exchanges, and to
encourage liquidity and should enable
the Exchange to continue to attract and
compete for order flow with other
exchanges. The Exchange notes that it
operates in a highly competitive market
in which market participants can
readily favor competing venues if they
deem fee levels at a particular venue to
be excessive. In such an environment,
the Exchange must continually adjust its
rebates and fees to remain competitive
with other exchanges and to attract
order flow. The Exchange believes that
the proposed rule changes reflect this
competitive environment because the
proposal modifies the Exchange’s fees in
a manner that encourages market
participants to continue to provide
liquidity and to send order flow to the
Exchange.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
See supra note 15.
VerDate Sep<11>2014
Non-Penny Class Maker segment for the
month of July 2022 in order for those
EEMs to receive the proposed additional
rebate because this should attract
additional Non-Penny Class volume
from EEMs, which should benefit all
Exchange participants by providing
more trading opportunities and tighter
spreads.
Jkt 256001
PO 00000
Frm 00084
Fmt 4703
Sfmt 4703
58847
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act,31 and Rule
19b–4(f)(2) 32 thereunder. 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.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File SR–PEARL–
2022–40 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–PEARL–2022–40. 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
31
32
15 U.S.C. 78s(b)(3)(A)(ii).
17 CFR 240.19b–4(f)(2).
E:\FR\FM\28SEN1.SGM
28SEN1
58848
Federal Register / Vol. 87, No. 187 / Wednesday, September 28, 2022 / Notices
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–PEARL–2022–40 and
should be submitted on or before
October 19, 2022.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.33
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022–20952 Filed 9–27–22; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–95859; File No. SR–
CboeEDGX–2022–040]
Self-Regulatory Organizations; Cboe
EDGX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Eliminate
the Listings Standards Provided for in
Chapter XIV of the Exchange’s
Rulebook
September 22, 2022.
lotter on DSK11XQN23PROD with NOTICES1
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on
September 9, 2022, Cboe EDGX
Exchange, Inc. filed with the Securities
and Exchange Commission (the
‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the self-regulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Cboe EDGX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘EDGX’’) is filing with
the Securities and Exchange
Commission (‘‘Commission’’) a
proposed amendment to eliminate the
listings standards provided for in
17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
33
VerDate Sep<11>2014
18:06 Sep 27, 2022
Jkt 256001
Chapter XIV of the Exchange Rulebook
as the Exchange is not a listing venue.3
The text of the proposed rule change is
provided in Exhibit 5.
The text of the proposed rule change
is also available on the Exchange’s
website (https://markets.cboe.com/us/
options/regulation/rule_filings/edgx/),
at the Exchange’s Office of the
Secretary, 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
As part of this proposal, the Exchange
proposes to (1) adopt a new definition
for Derivative Security, move the
definition of unlisted trading privileges
(‘‘UTP’’) Derivative Security 4 from Rule
14.1(c) to Exchange Rule 1.5(gg), and
amend Rule 3.21 to reference proposed
Rule 1.5(gg); (2) eliminate listing
standards and any references to
Exchange listed securities from Chapter
XIV (Securities Traded) and Rules 3.7,
11.2, and 13.6; (3) amend Rule 14.1(a)
to provide for NMS stocks rather than
equity securities and amend the
Exchange’s additional rules applicable
to UTP Derivative Securities as
provided in Rule 14.1(c)(1)–(6); and (4)
amend Rule 14.10 to make ministerial
changes to update paragraph
numbering. As discussed in further
detail below, all of the proposed
changes are substantially similar to
other exchange rules.
3 As noted in a recent filing, the Exchange
represented that it planned to submit a proposal to
amend its applicable Rules set forth in Chapter XIV
in order to reflect that the Exchange does not
currently list any securities, nor does it intend to
list any securities, in the foreseeable future.
Accordingly, the Exchange is now proposing to
amend its Rules. See Securities Exchange Act No.
89020 (June 4, 2020) 85 FR 35482 (June 10, 2020)
(SR–CboeEDGX–2020–026).
4 See Rule 14.1(c) and proposed Rule 1.5(gg).
PO 00000
Frm 00085
Fmt 4703
Sfmt 4703
(1) Proposal To Define Derivative
Security in Exchange Rule 1.5(ff) and
Add the Definition of UTP Derivative
Security to Re-Lettered Exchange Rule
1.5(gg)
The Exchange proposes to define
‘‘Derivative Security’’ in proposed Rule
1.5(ff) and amend existing Rule 1.5(gg)
to add the definition of ‘‘UTP Derivative
Security’’. ‘‘Derivative Security’’ would
be a new definition and would mean a
security that meets the definition of
‘‘new derivative securities product’’ in
Rule 19b–4(e) under the Act. ‘‘UTP
Derivative Security’’ would refer to any
one of a list of Derivative Securities that
trades on the Exchange pursuant to
unlisted trading privileges. The list of
proposed Derivative Securities that may
meet the definition of UTP Derivative
Security are as follows: Equity Linked
Notes; Index Fund Shares listed
pursuant to Cboe BZX Exchange, Inc.
(‘‘BZX’’) Rule 14.11(c) or Nasdaq Stock
Market LLC (‘‘Nasdaq’’) Rule 5705(b)
and Investment Company Units listed
pursuant to NYSE Arca, Inc. (‘‘NYSE
Arca’’) Rule 5.2–E(j)(3); Index-Linked
Exchangeable Notes; Equity Gold
Shares; Equity Index-Linked Securities;
Commodity-Linked Securities;
Currency-Linked Securities; Fixed
Income Index-Linked Securities;
Futures-Linked Securities; Multifactor
Index-Linked Securities; Trust
Certificates; Currency and Index
Warrants; Portfolio Depository Receipts;
Trust Issued Receipts; CommodityBased Trust Shares; Currency Trust
Shares; Commodity Index Trust Shares;
Commodity Futures Trust Shares;
Partnership Units; Paired Trust Shares;
Trust Units; Managed Fund Shares;
Managed Trust Securities; Managed
Portfolio Shares; Tracking Fund Shares
listed pursuant to BZX Exchange Rule
14.11(m), Active Proxy Portfolio Shares
listed pursuant to NYSE Arca Rule
8.601–E, and Proxy Portfolio Shares
listed pursuant to Nasdaq Stock Market
LLC Rule 5750; Selected Equity-linked
Debt Securities (‘‘SEEDS’’); ExchangeTraded Fund Shares; and Contingent
Value Rights (‘‘CVRs’’).5 The proposed
definition of UTP Security and UTP
Derivative Security is substantially
similar to BZX Rule 1.5(ee), except that
the list of Derivative Securities that may
be UTP Derivative Securities includes
CVRs. Further, the proposal is
substantially similar to NYSE National,
Inc. (‘‘NYSE National’’) Rule 1.1(m), but
the list of Derivative Securities that may
be UTP Derivative Securities includes
5 For inclusiveness, all Derivative Securities that
are subject to unlisted trading privileges have been
identified in the list of proposed UTP Derivative
Securities.
E:\FR\FM\28SEN1.SGM
28SEN1
]]>Agencies
[Federal Register Volume 87, Number 187 (Wednesday, September 28, 2022)]
[Notices]
[Pages 58843-58848]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-20952]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-95886; File No. SR-PEARL-2022-40]
Self-Regulatory Organizations: Notice of Filing and Immediate
Effectiveness of a Proposed Rule Change by MIAX PEARL, LLC To Amend the
MIAX Pearl Options Fee Schedule
September 22, 2022.
Pursuant to the provisions of 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 September 14, 2022, MIAX PEARL, LLC (``MIAX
Pearl'' or ``Exchange'') filed with the Securities and Exchange
Commission (``Commission'') a proposed rule change as described in
Items I, II, and III 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is filing a proposal to amend the MIAX Pearl Options
Fee Schedule (the ``Fee Schedule'').
The text of the proposed rule change is available on the Exchange's
website at https://www.miaxoptions.com/rule-filings/pearl at MIAX
Pearl's principal office, and at the Commission's Public Reference
Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of
[[Page 58844]]
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 Add/Remove Tiered Rebates/Fees
set forth in Section 1(a) of the Fee Schedule to: (1) modify the Maker
rebates (defined below) in all Tiers for transactions in Penny Classes
(defined below) for MIAX Pearl Market Makers,\3\ Non-Priority
Customers, Firms, Broker-Dealers and Non-MIAX Pearl Market Makers; and
(2) provide for additional, separate Maker rebates for Market Makers
and Electronic Exchange Member (``EEM'') \4\ Professional origins
(defined below) for certain transactions in Non-Penny Classes (defined
below). The Exchange originally filed this proposal on September 1,
2022 (SR-PEARL-2022-38). On September 14, 2022, the Exchange withdrew
SR-PEARL-2022-38 and resubmitted this proposal.
---------------------------------------------------------------------------
\3\ ``Market Maker'' means a Member registered with the Exchange
for the purpose of making markets in options contracts traded on the
Exchange and that is vested with the rights and responsibilities
specified in Chapter VI of Exchange Rules. See the Definitions
Section of the Fee Schedule and Exchange Rule 100.
\4\ ``Electronic Exchange Member'' or ``EEM'' means the holder
of a Trading Permit who is a Member representing as agent Public
Customer Orders or Non-Customer Orders on the Exchange and those
non-Market Maker Members conducting proprietary trading. Electronic
Exchange Members are deemed ``members'' under the Exchange Act. See
the Definitions Section of the Fee Schedule and Exchange Rule 100.
---------------------------------------------------------------------------
Background
The Exchange currently assesses transaction rebates and fees to all
market participants which are based upon the total monthly volume
executed by the Member \5\ on MIAX Pearl in the relevant, respective
origin type (not including Excluded Contracts) \6\ (as the numerator)
expressed as a percentage of (divided by) TCV \7\ (as the denominator).
In addition, the per contract transaction rebates and fees are applied
retroactively to all eligible volume for that origin type once the
respective threshold tier (``Tier'') has been reached by the Member.
The Exchange aggregates the volume of Members and their Affiliates.\8\
Members that place resting liquidity, i.e., orders resting on the book
of the MIAX Pearl System,\9\ are paid the specified ``maker'' rebate
(each a ``Maker''), and Members that execute against resting liquidity
are assessed the specified ``taker'' fee (each a ``Taker''). For
opening transactions and ABBO \10\ uncrossing transactions, per
contract transaction rebates and fees are waived for all market
participants. Finally, Members are assessed lower transaction fees and
receive lower rebates for order executions in standard option classes
in the Penny Interval Program \11\ (``Penny Classes'') than for order
executions in standard option classes which are not in the Penny
Interval Program (``Non-Penny Classes''), where Members are assessed
higher transaction fees and receive higher rebates.
---------------------------------------------------------------------------
\5\ ``Member'' means an individual or organization that is
registered with the Exchange pursuant to Chapter II of Exchange
Rules for purposes of trading on the Exchange as an ``Electronic
Exchange Member'' or ``Market Maker.'' Members are deemed
``members'' under the Exchange Act. See the Definitions Section of
the Fee Schedule and Exchange Rule 100.
\6\ ``Excluded Contracts'' means any contracts routed to an away
market for execution. See the Definitions Section of the Fee
Schedule.
\7\ ``TCV'' means total consolidated volume calculated as the
total national volume in those classes listed on MIAX PEARL for the
month for which the fees apply, excluding consolidated volume
executed during the period time in which the Exchange experiences an
``Exchange System Disruption'' (solely in the option classes of the
affected Matching Engine (as defined below)). The term Exchange
System Disruption, which is defined in the Definitions section of
the Fee Schedule, means an outage of a Matching Engine or collective
Matching Engines for a period of two consecutive hours or more,
during trading hours. The term Matching Engine, which is also
defined in the Definitions section of the Fee Schedule, is a part of
the MIAX PEARL electronic system that processes options orders and
trades on a symbol-by-symbol basis. Some Matching Engines will
process option classes with multiple root symbols, and other
Matching Engines may be dedicated to one single option root symbol
(for example, options on SPY may be processed by one single Matching
Engine that is dedicated only to SPY). A particular root symbol may
only be assigned to a single designated Matching Engine. A
particular root symbol may not be assigned to multiple Matching
Engines. The Exchange believes that it is reasonable and appropriate
to select two consecutive hours as the amount of time necessary to
constitute an Exchange System Disruption, as two hours equates to
approximately 1.4% of available trading time per month. The Exchange
notes that the term ``Exchange System Disruption'' and its meaning
have no applicability outside of the Fee Schedule, as it is used
solely for purposes of calculating volume for the threshold tiers in
the Fee Schedule. See the Definitions Section of the Fee Schedule.
\8\ ``Affiliate'' means (i) an affiliate of a Member of at least
75% common ownership between the firms as reflected on each firm's
Form BD, Schedule A, or (ii) the Appointed Market Maker of an
Appointed EEM (or, conversely, the Appointed EEM of an Appointed
Market Maker). An ``Appointed Market Maker'' is a MIAX PEARL Market
Maker (who does not otherwise have a corporate affiliation based
upon common ownership with an EEM) that has been appointed by an EEM
and an ``Appointed EEM'' is an EEM (who does not otherwise have a
corporate affiliation based upon common ownership with a MIAX PEARL
Market Maker) that has been appointed by a MIAX PEARL Market Maker,
pursuant to the following process. A MIAX PEARL Market Maker
appoints an EEM and an EEM appoints a MIAX PEARL Market Maker, for
the purposes of the Fee Schedule, by each completing and sending an
executed Volume Aggregation Request Form by email to
[email protected] no later than 2 business days prior to
the first business day of the month in which the designation is to
become effective. Transmittal of a validly completed and executed
form to the Exchange along with the Exchange's acknowledgement of
the effective designation to each of the Market Maker and EEM will
be viewed as acceptance of the appointment. The Exchange will only
recognize one designation per Member. A Member may make a
designation not more than once every 12 months (from the date of its
most recent designation), which designation shall remain in effect
unless or until the Exchange receives written notice submitted 2
business days prior to the first business day of the month from
either Member indicating that the appointment has been terminated.
Designations will become operative on the first business day of the
effective month and may not be terminated prior to the end of the
month. Execution data and reports will be provided to both parties.
See the Definitions Section of the Fee Schedule.
\9\ The term ``System'' means the automated trading system used
by the Exchange for the trading of securities. See Exchange Rule
100.
\10\ ``ABBO'' means the best bid(s) or offer(s) disseminated by
other Eligible Exchanges (defined in Exchange Rule 1400(g)) and
calculated by the Exchange based on market information received by
the Exchange from OPRA. See the Definitions Section of the Fee
Schedule and Exchange Rule 100.
\11\ See Securities Exchange Act Release No. 88992 (June 2,
2020), 85 FR 35142 (June 8, 2020) (SR-PEARL-2020-06).
---------------------------------------------------------------------------
Proposal To Modify the Maker Rebates in All Tiers for Transactions in
Penny Classes for Market Makers and Non-Priority Customer, Firm, BD and
Non-MIAX Pearl Market Maker Origins
The Exchange proposes to amend the Fee Schedule for the Exchange's
options market to modify the Maker rebates in all Tiers for options
transactions in Penny Classes for Market Makers and Non-Priority
Customer, Firm, BD and Non-MIAX Pearl Market Maker origins' respective
rate tables. Currently, the Exchange provides different Maker rebates
for options transactions in Penny Classes for Market Makers and Non-
Priority Customer, Firm, BD and Non-MIAX Pearl Market Maker origins
depending on whether the Member is trading against the Priority
Customer \12\ origin or another origin type. In particular, the
Exchange provides the following Maker rebates for Market Makers for
options transactions in Penny Classes when trading against the Priority
Customer origin: ($0.23) in Tier 1, ($0.38) in Tier 2, ($0.38) in Tier
3, ($0.45) in Tier 4, ($0.46) in Tier 5, and
[[Page 58845]]
($0.47) in Tier 6. The Exchange provides the following Maker rebates
for Non-Priority Customer, Firm, BD and Non-MIAX Pearl Market Maker
origins for options transactions in Penny Classes when trading against
the Priority Customer origin: ($0.23) in Tier 1, ($0.38) in Tier 2,
($0.38) in Tier 3, ($0.45) in Tier 4, ($0.46) in Tier 5, and ($0.46) in
Tier 6.
---------------------------------------------------------------------------
\12\ The term ``Priority Customer'' means a person or entity
that (i) is not a broker or dealer in securities, and (ii) does not
place more than 390 orders in listed options per day on average
during a calendar month for its own beneficial accounts(s). The
number of orders shall be counted in accordance with Interpretation
and Policy .01 of Exchange Rule 100. See the Definitions Section of
the Fee Schedule and Exchange Rule 100, including Interpretation and
Policy .01.
---------------------------------------------------------------------------
The Exchange now proposes to lower the Maker rebates by $0.01 in
all Tiers for options transactions in Penny Classes for Market Makers
and Non-Priority Customer, Firm, BD and Non-MIAX Pearl Market Maker
origins, respectively, when trading against the Priority Customer
origin. Accordingly, with the proposed changes, the Exchange will
provide the following Maker rebates for Market Makers for options
transactions in Penny Classes when trading against the Priority
Customer origin: ($0.22) in Tier 1, ($0.37) in Tier 2, ($0.37) in Tier
3, ($0.44) in Tier 4, ($0.45) in Tier 5, and ($0.46) in Tier 6. The
Exchange will provide the following Maker rebates for Non-Priority
Customer, Firm, BD and Non-MIAX Pearl Market Maker origins for options
transactions in Penny Classes when trading against the Priority
Customer origin: ($0.22) in Tier 1, ($0.37) in Tier 2, ($0.37) in Tier
3, ($0.44) in Tier 4, ($0.45) in Tier 5, and ($0.45) in Tier 6.
The purpose of adjusting the specified Maker rebates is for
business and competitive reasons. In order to attract order flow, the
Exchange initially set its Maker rebates so that they were higher than
other options exchanges that operate comparable maker/taker pricing
models.\13\ The Exchange believes that it is appropriate to adjust
these specified Maker rebates so that they are more in line with other
exchanges, but will remain highly competitive such that they should
enable the Exchange to continue to attract order flow and maintain
market share.\14\
---------------------------------------------------------------------------
\13\ See Securities Exchange Act Release Nos. 80061 (February
17, 2017), 82 FR 11676 (February 24, 2017) (SR-PEARL-2017-10)
(establishing the Exchange's fee schedule with Market Maker and
Professional Member Maker Penny Class rebates ranging from ($0.25)
in Tier 1 to ($0.48) in Tier 4, the highest Tier at that time).
\14\ See, generally, The Nasdaq Stock Market, Options 7 Pricing
Schedule, Section 2 (Market Maker and Professional Member rebates
ranging from $0.20 in Tier 1 to $0.48 in Tier 6); Box Options Fee
Schedule, Section IV. Electronic Transaction Fees, Section A (Market
Maker rebate of $0.50 when trading contra to a BOX Public Customer
for options transactions in Penny Classes); Cboe BZX Options Fee
Schedule, Standard Rates (Market Maker rebates for Penny Class
securities ranging from $0.29 to $0.46 for adding liquidity;
Professional rebates for Penny Class securities ranging from $0.25
to $0.48 for adding liquidity; and Firm, Broker-Dealer, Joint Back
Office rebates for Penny Class securities ranging from $0.25 to
$0.46 for adding liquidity).
---------------------------------------------------------------------------
Proposal To Adopt Additional, Separate Maker Rebates for Market Makers
and Non-Priority Customer, Firm, BD and Non-MIAX Pearl Market Maker
Origins for Certain Transactions in Non-Penny Classes
The Exchange proposes to amend the Fee Schedule for the Exchange's
options market to adopt additional separate Maker rebates for Market
Makers and Non-Priority Customer, Firm, BD and Non-MIAX Pearl Market
Maker origins for options transactions in Non-Penny Classes in Tiers 1
through 4. Currently, the Exchange provides the following Maker rebates
for Market Makers and Non-Priority Customer, Firm, BD and Non-MIAX
Pearl Market Maker origins for options transactions in Non-Penny
Classes: ($0.30) in Tier 1, ($0.30) in Tier 2, ($0.60) in Tier 3,
($0.65) in Tier 4, ($0.70) in Tier 5, and ($0.85) in Tier 6.\15\
---------------------------------------------------------------------------
\15\ The Exchange notes that the current Maker rebates for
Market Makers and Non-Priority Customer, Firm, BD and Non-MIAX Pearl
Market Maker origins for options transactions in Non-Penny Classes
are similar to non-penny class maker rebates for similar origins at
competing options exchanges. See, e.g., NYSE Arca Options Fee
Schedule, Non-Customer, Non-Penny Posting Credit Tiers, Page 8
(providing base non-customer, non-penny maker rebates ranging from
($0.32) to ($0.82)); Cboe BZX Options Fee Schedule, Standard Rates
(providing firm, broker dealer and joint back office non-penny
program securities maker rebates ranging from ($0.30) to ($0.82) and
market maker non-penny program securities maker rebates ranging from
($0.40) to ($0.88)).
---------------------------------------------------------------------------
The Exchange now proposes to adopt additional, separate Maker
rebates for Market Makers for options transactions in Non-Penny Classes
in Tiers 1 through 4. In particular, the Exchange proposes that Market
Makers may qualify for additional, separate rebates for options
transactions in Non-Penny classes in Tiers 1 through 4 if the Market
Maker increases their Non-Penny Class Maker TCV by 100% or more as
compared to that Market Maker's Non-Penny Class TCV for the month of
July 2022,\16\ which will be the Market Maker's baseline Non-Penny
Class Maker TCV. Market Makers that qualify for the additional Non-
Penny Class Maker rebate will receive the following additional,
separate rebates: ($0.40) in Tier 1; ($0.40) in Tier 2; ($0.10) in Tier
3; and ($0.05) in Tier 4. Market Makers with no volume in the Non-Penny
Class Maker segment for the month of July 2022 will have any new volume
considered as added volume. Stated another way, the Exchange proposes
that Market Makers who did not have any volume in the Non-Penny Class
Maker segment for the month of July 2022, will receive the proposed
additional separate Maker rebates for any new Non-Penny Class Maker
volume in each subsequent month. The Exchange proposes to denote the
additional Maker rebates in Non-Penny Classes for Market Makers by
adopting new footnote ``[squf]'' following the tables of fees and
rebates in Section 1)a) of the Fee Schedule. For example, if a Market
Maker has specific Non-Penny Class Maker volume of 0.050% TCV for the
month of July 2022, then that Market Maker would need Non-Penny Class
Maker volume equal to or greater than 0.100% TCV in the relevant month
to receive the additional proposed rebates. The purpose of this change
is for business and competitive reasons in order to attract additional
Non-Penny Class volume from Market Makers, which should benefit all
Exchange participants by providing more trading opportunities and
tighter spreads.\17\
---------------------------------------------------------------------------
\16\ The Exchange determined to use the month of July 2022 as
the baseline month because, at the time of the original filing (SR-
PEARL-2022-38), July was the most recent previous full month of
trading. For purposes of consistency with the original filing, the
Exchange proposes to continue to use the month of July 2022 as the
baseline month.
\17\ See supra note 15. The Exchange notes that NYSE American,
LLC has a similar ``step-up'' incentive for its Professional
Customer, Broker Dealer, Non-NYSE American Options Market Maker and
Firm ranges, whereby those market participants are able to decrease
their fees for transactions in non-penny classes by increasing their
volume by specified percentages of TCADV over their August 2019
volume. See NYSE American Options Fee Schedule, Section I.A. and
Section I.H. (charging an $0.85 fee to Professional Customer, Broker
Dealer, Non-NYSE American Options Market Maker and Firm ranges for
transactions in non-penny classes and decreased fees of either $0.65
or $0.55 for transactions in on-penny classes depending on the
amount of increased volume by specified percentages of TCADV over
their August 2019 volume). See id., Key Terms and Definitions
Section for definitions of Professional Customer, Broker Dealer,
Non-NYSE American Options Market Maker, Firm and TCADV.
---------------------------------------------------------------------------
The Exchange also proposes to adopt an additional, separate Maker
rebate for EEM Professional origins (which includes, collectively, Non-
Priority Customer, Firm, BD and Non-MIAX Pearl Market Maker origins),
for options transactions in Non-Penny Classes in Tiers 1 through 4. In
particular, the Exchange proposes that EEMs may qualify for additional
separate rebates for options transactions in Non-Penny classes in Tiers
1 through 4 if the EEM increases their Professional origin Non-Penny
Class Maker TCV by 100% or more as compared to that EEM's Professional
origin Non-Penny Class TCV for the month of July 2022,\18\ which will
be EEM's Professional origin baseline Non-Penny Class Maker TCV. EEMs
that qualify for the additional Non-Penny Class Maker rebate will
[[Page 58846]]
receive the following additional, separate rebates: ($0.40) in Tier 1;
($0.40) in Tier 2; ($0.10) in Tier 3; and ($0.05) in Tier 4.\19\ EEMs
with no Professional origin volume in the Non-Penny Class Maker segment
for the month of July 2022 will have any new volume considered as added
volume. Stated another way, the Exchange proposes that EEM Professional
origins that did not have any volume in the Non-Penny Class Maker
segment for the month of July 2022, will receive the proposed
additional separate Maker rebates for any new Non-Penny Class Maker
volume in each subsequent month. The Exchange proposes to denote the
additional Maker rebates in Non-Penny Classes for EEMs by adopting new
footnote ``[square]'' following the tables of fees and rebates in
Section 1)a) of the Fee Schedule. For example, if an EEM has specific
Professional origin Non-Penny Class Maker volume of 0.050% TCV for the
month of July 2022, then that EEM would need Professional origin Non-
Penny Class Maker volume equal to or greater than 0.100% TCV in the
relevant month to receive the additional proposed rebates. The purpose
of this change is for business and competitive reasons in order to
attract additional Non-Penny Class volume from EEMs, which should
benefit all Exchange participants by providing more trading
opportunities and tighter spreads.\20\
---------------------------------------------------------------------------
\18\ See supra note 16.
\19\ With the proposed additional rebates, the Exchange's Non-
Penny Class Maker rebates in Tiers 1 through 4 for Market Makers and
EEM Professional origins will be in line with, or higher than (for
lower tiers), similar rebates from competing options exchanges
depending on the tier achieved by the particular member. See supra
note 15.
\20\ See supra notes 15 and 17.
---------------------------------------------------------------------------
Implementation
The proposed changes are immediately effective.
2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \21\ in general, and
furthers the objectives of Section 6(b)(4) of the Act,\22\ in that it
is an equitable allocation of reasonable dues, fees and other charges
among Exchange members and issuers and other persons using its
facilities, and 6(b)(5) of the Act,\23\ in that it is designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in facilitating transactions in
securities, to remove impediments to and perfect the mechanisms of a
free and open market and a national market system and, in general, to
protect investors and the public interest.
---------------------------------------------------------------------------
\21\ 15 U.S.C. 78f(b).
\22\ 15 U.S.C. 78f(b)(4).
\23\ 15 U.S.C. 78f(b)(1) and (b)(5).
---------------------------------------------------------------------------
The Commission has repeatedly expressed its preference for
competition over regulatory intervention in determining prices,
products, and services in the securities markets. In Regulation NMS,
the Commission highlighted the importance of market forces in
determining prices and SRO revenues and, also, recognized that current
regulation of the market system ``has been remarkably successful in
promoting market competition in its broader forms that are most
important to investors and listed companies.'' \24\
---------------------------------------------------------------------------
\24\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496 (June 29, 2005).
---------------------------------------------------------------------------
There are currently 16 registered options exchanges competing for
order flow. Based on publicly-available information, and excluding
index-based options, as of September 13, 2022, no single exchange has
more than approximately 11-13% equity options market share for the
month of September 2022.\25\ Therefore, no exchange possesses
significant pricing power. More specifically, as of September 13, 2022,
the Exchange has a market share of approximately 4.34% of executed
volume of multiply-listed equity options for the month of September
2022.\26\
---------------------------------------------------------------------------
\25\ See ``The market at a glance,'' (last visited September 13,
2022), available at https://www.miaxoptions.com/.
\26\ See id.
---------------------------------------------------------------------------
The Exchange believes that the ever-shifting market share among the
exchanges from month to month demonstrates that market participants can
discontinue or reduce use of certain categories of products and
services, terminate an existing membership or determine to not become a
new member, and/or shift order flow, in response to transaction fee
changes. For example, on February 28, 2019, the Exchange filed with the
Commission a proposal to increase Taker fees in certain Tiers for
options transactions in certain Penny classes for Priority Customers
and decrease Maker rebates in certain Tiers for options transactions in
Penny classes for Priority Customers (which fee was to be effective
March 1, 2019).\27\ The Exchange experienced a decrease in total market
share for the month of March 2019, after the proposal went into effect.
Accordingly, the Exchange believes that its March 1, 2019, fee change,
to increase certain transaction fees and decrease certain transaction
rebates, may have contributed to the decrease in MIAX Pearl's market
share and, as such, the Exchange believes competitive forces constrain
the Exchange's, and other options exchanges, ability to set transaction
fees and market participants can shift order flow based on fee changes
instituted by the exchanges.
---------------------------------------------------------------------------
\27\ See Securities Exchange Act Release No. 85304 (March 13,
2019), 84 FR 10144 (March 19, 2019) (SR-PEARL-2019-07).
---------------------------------------------------------------------------
The Exchange believes its proposal to modify the Maker rebates in
all Tiers for options transactions in Penny classes for Market Makers
and Non-Priority Customer, Firm, BD and Non-MIAX Pearl Market Maker
origins when trading against Priority Customer origin is reasonable,
equitable and not unfairly discriminatory because all similarly
situated market participants in the same origin type are subject to the
same tiered Maker rebates and access to the Exchange is offered on
terms that are not unfairly discriminatory. For competitive and
business reasons, the Exchange initially set its Maker rebates for such
orders generally higher than certain other options exchanges that
operate comparable maker/taker pricing models. The Exchange now
believes that it is appropriate to modify those specified Maker rebates
so that they are more in line with other exchanges, and will remain
highly competitive such that they should enable the Exchange to
continue to attract order flow and maintain market share.\28\
---------------------------------------------------------------------------
\28\ See supra note 14.
---------------------------------------------------------------------------
The Exchange believes its proposal is not unfairly discriminatory
because, with the proposed changes, the Maker rebates for Market Makers
and Non-Priority Customer, Firm, BD and Non-MIAX Pearl Market Maker
origins will be nearly the same as the Maker rebates for all other
origin types except for Priority Customer origin orders. The Exchange
believes that it is equitable and not unfairly discriminatory to assess
lower Maker rebates to Market Makers and EEM Professional origins than
to Priority Customer origin orders. A Priority Customer is by
definition not a broker or dealer in securities, and does not place
more than 390 orders in listed options per day on average during a
calendar month for its own beneficial account(s).\29\ This limitation
does not apply to participants on the Exchange whose behavior is
substantially similar to that of market professionals, including non-
Priority Customers, Non-MIAX Pearl Market Makers, Firms, and Broker-
Dealers, who will generally submit a higher number of orders (many
[[Page 58847]]
of which do not result in executions) than Priority Customers.
---------------------------------------------------------------------------
\29\ See supra note 12.
---------------------------------------------------------------------------
The Exchange believes its proposal to adopt additional, separate
Maker rebates for options transactions in Non-Penny Classes in Tiers 1
through 4 for Market Makers and EEM Professional origins is reasonable,
equitable and not unfairly discriminatory because all similarly
situated market participants in the same origin type are subject to the
same tiered Maker rebates and access to the Exchange is offered on
terms that are not unfairly discriminatory. The Exchange believes its
proposal to offer an additional Non-Penny Class Maker rebates in Tiers
1 through 4 for Market Makers and EEM Professional origins will
incentivize Market Makers and EEMs to improve their posted liquidity to
the benefit of the entire market, which will increase order flow sent
to the Exchange, benefiting all market participants through increased
liquidity, tighter markets and order interaction. The Exchange believes
it is reasonable and not unfairly discriminatory to offer higher
additional Non-Penny Class Maker rebates for Tiers 1 and 2, as compared
to Tiers 3 and 4, because the Exchange believes that the prospect of
obtaining the higher rebates for Tiers 1 and 2 will attract Non-Penny
Class Maker volume from new market participants. This anticipated new
Non-Penny Class Maker volume should benefit all Exchange participants
by providing more trading opportunities and tighter spreads. Further,
with the proposed additional rebates, the Exchange's Non-Penny Class
Maker rebates in Tiers 1 through 4 for Market Makers and EEM
Professional origins will be in line with, or higher than (for Tiers 1
and 2) similar rebates from competing options exchanges.\30\
---------------------------------------------------------------------------
\30\ See supra note 15.
---------------------------------------------------------------------------
The Exchange believes it is reasonable, equitable and not unfairly
discriminatory to consider any new Non-Penny Class Maker volume as
added volume for Market Makers with no volume in the Non-Penny Class
Maker segment for the month of July 2022 in order for those Market
Makers to receive the proposed additional rebate because this should
attract additional Non-Penny Class Maker volume from Market Makers. In
turn, this additional volume should benefit all Exchange participants
by providing more trading opportunities and tighter spreads. Similarly,
the Exchange believes it is reasonable, equitable and not unfairly
discriminatory to consider any new Non-Penny Class Maker volume as
added volume for EEMs with no Professional origin volume in the Non-
Penny Class Maker segment for the month of July 2022 in order for those
EEMs to receive the proposed additional rebate because this should
attract additional Non-Penny Class volume from EEMs, which should
benefit all Exchange participants by providing more trading
opportunities and tighter spreads.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule changes will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange believes that the
proposed changes in the Maker rebates for the applicable market
participants should continue to encourage the provision of liquidity
that enhances the quality of the Exchange's market and increases the
number of trading opportunities on the Exchange for all participants
who will be able to compete for such opportunities. The proposed rule
changes should enable the Exchange to continue to attract and compete
for order flow with other exchanges. However, this competition does not
create an undue burden on competition but rather offers all market
participants the opportunity to receive the benefit of competitive
pricing.
The proposed Maker rebate adjustments are intended to keep the
Exchange's rebates highly competitive with those of other exchanges,
and to encourage liquidity and should enable the Exchange to continue
to attract and compete for order flow with other exchanges. The
Exchange notes that it operates in a highly competitive market in which
market participants can readily favor competing venues if they deem fee
levels at a particular venue to be excessive. In such an environment,
the Exchange must continually adjust its rebates and fees to remain
competitive with other exchanges and to attract order flow. The
Exchange believes that the proposed rule changes reflect this
competitive environment because the proposal modifies the Exchange's
fees in a manner that encourages market participants to continue to
provide liquidity and to send order flow to the Exchange.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\31\ and Rule 19b-4(f)(2) \32\ thereunder.
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.
---------------------------------------------------------------------------
\31\ 15 U.S.C. 78s(b)(3)(A)(ii).
\32\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
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 SR-PEARL-2022-40 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-PEARL-2022-40. 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
[[Page 58848]]
Reference Room, 100 F Street NE, Washington, DC 20549, on official
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of
such filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change. Persons submitting comments are cautioned that we do
not redact or edit personal identifying information from comment
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-
PEARL-2022-40 and should be submitted on or before October 19, 2022.
---------------------------------------------------------------------------
\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,
Deputy Secretary.
[FR Doc. 2022-20952 Filed 9-27-22; 8:45 am]
BILLING CODE 8011-01-P
