Self-Regulatory Organizations: Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by Miami International Securities Exchange LLC To Amend Its Fee Schedule, 9555-9560 [2023-03055]
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Federal Register / Vol. 88, No. 30 / Tuesday, February 14, 2023 / Notices
Exchange does not believe that the
proposed change will impair the ability
of Members or competing order
execution venues to maintain their
competitive standing in the financial
markets.
Paper Comments
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
All submissions should refer to File
Number SR–MIAX–2023–02. This file
number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–MIAX–2023–02, and
should be submitted on or before March
7, 2023.
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days 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 29 and Rule 19b–4(f)(6) 30
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
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• 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–
MIAX–2023–02 on the subject line.
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.
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.31
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023–03058 Filed 2–13–23; 8:45 am]
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–96835; File No. SR–MIAX–
2023–03]
Self-Regulatory Organizations: Miami
International Securities Exchange LLC;
Notice of Filing and Immediate
Effectiveness of a Proposed Rule
Change by Miami International
Securities Exchange LLC To Amend Its
Fee Schedule
February 8, 2023.
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 January 31, 2023, Miami
International Securities Exchange LLC
(‘‘MIAX’’ 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 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, at MIAX’s principal office, and
at the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
1 15
31 17
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CFR 200.30–3(a)(12).
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U.S.C. 78s(b)(1).
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A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend
Section 1)a)iii) of the Fee Schedule to
modify the Priority Customer Rebate
Program (‘‘PCRP’’) 3 to (i) reduce the per
contract credit for Simple Orders 4 in
MIAX Select Symbols in Tier 3 of the
PCRP; 5 (ii) modify the PCRP table to
reflect that the per contract credit for
cPRIME Agency Orders will be based
upon the per Contract Credit for cPRIME
Agency Order table (to be renamed the
‘‘cPRIME Agency Order Break-up
Table’’); (iii) modify the Per Contract
Credit for cPRIME Agency Order table to
remove the maximum leg size
requirement; and (iv) rename the Per
Contract Credit for cPRIME Agency
Order table to the cPRIME Agency Order
Break-up Table.
The proposed changes will be
effective on February 1, 2023.
Background
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Priority Customer Rebate Program
The Exchange’s Fee Schedule
provides for a Priority Customer Rebate
Program, under which a Priority
Customer 6 rebate payment is calculated
3 Under the PCRP, MIAX credits each Member the
per contract amount resulting from each Priority
Customer order transmitted by that Member which
is executed electronically on the Exchange in all
multiply-listed option classes (excluding, in simple
or complex as applicable, QCC and cQCC Orders,
mini-options, Priority Customer-to-Priority
Customer Orders, C2C and cC2C Orders, PRIME and
cPRIME AOC Responses, PRIME and cPRIME
Contra-side Orders, PRIME and cPRIME Orders for
which both the Agency and Contra-side Order are
Priority Customers, and executions related to
contracts that are routed to one or more exchanges
in connection with the Options Order Protection
and Locked/Crossed Market Plan referenced in
Exchange Rule 1400), provided the Member meets
certain percentage thresholds in a month as
described in the Priority Customer Rebate Program
table. See Fee Schedule, Section 1)a)iii. The term
‘‘Member’’ means an individual or organization
approved to exercise the trading rights associated
with a Trading Permit. Members are deemed
‘‘members’’ under the Exchange Act. See Exchange
Rule 100.
4 The ‘‘Simple Order Book’’ is the Exchange’s
regular electronic book of orders and quotes. See
Exchange Rule 518(a)(15).
5 The term ‘‘MIAX Select Symbols’’ means
options overlying AAL, AAPL, AMAT, AMD,
AMZN, BA, BABA, BB, BIDU, BP, C, CAT, CLF,
CVX, DAL, EBAY, EEM, FCX, GE, GILD, GLD, GM,
GOOGL, GPRO, HAL, INTC, IWM, JNJ, JPM, KMI,
KO, META, MO, MRK, NFLX, NOK, ORCL, PBR,
PFE, PG, QCOM, QQQ, RIG, SPY, T, TSLA, USO,
VALE, WBA, WFC, WMB, X, XHB, XLE, XLF, XLP,
XOM and XOP. See Fee Schedule, Section 1)a)iii),
note 14.
6 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
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from the first executed contract at the
applicable threshold per contract credit
with rebate payments made at the
highest achieved volume tier for each
contract traded in that month. The
percentage thresholds are calculated
based on the percentage of national
customer volume in multiply-listed
option classes listed on MIAX entered
and executed over the course of the
month (excluding QCC 7 and cQCC
Orders,8 Priority Customer-to-Priority
Customer Orders, C2C,9 and cC2C
Orders,10 PRIME and cPRIME AOC
Responses, PRIME and cPRIME Contraside Orders, and PRIME and cPRIME
Orders 11 for which both the Agency and
Contra-side Order are Priority
Customers). Volume for transactions in
both simple and complex orders are
aggregated to determine the appropriate
volume tier threshold applicable to each
transaction. Volume is recorded for, and
credits are delivered to, the Member that
submits the order to MIAX. MIAX
aggregates the contracts resulting from
Priority Customer Orders 12 transmitted
and executed electronically on MIAX
from Members and Affiliates 13 for
a calendar month for its own beneficial account(s).
See Exchange Rule 100.
7 A Qualified Contingent Cross Order is
comprised of an originating order to buy or sell at
least 1,000 contracts, or 10,000 mini-option
contracts, that is identified as being part of a
qualified contingent trade, as that term is defined
in Interpretations and Policies .01 below, coupled
with a contra-side order or orders totaling an equal
number of contracts. See Exchange Rule 516(j).
8 A Complex Qualified Contingent Cross or
‘‘cQCC’’ Order is comprised of an originating
complex order to buy or sell where each component
is at least 1,000 contracts that is identified as being
part of a qualified contingent trade, as defined in
Rule 516, Interpretations and Policies .01, coupled
with a contra-side complex order or orders totaling
an equal number of contracts. Trading of cQCC
Orders is governed by Rule 515(h)(4). See Exchange
Rule 518(b)(6).
9 A Customer Cross Order is comprised of a
Priority Customer Order to buy and a Priority
Customer Order to sell at the same price and for the
same quantity. See Exchange Rule 516(i).
10 A Complex Customer Cross or ‘‘cC2C’’ Order is
comprised of one Priority Customer complex order
to buy and one Priority Customer complex order to
sell at the same price and for the same quantity.
Trading of cC2C Orders is governed by Rule
515(h)(3). See Exchange Rule 518(b)(5).
11 PRIME and cPRIME Orders are described in
more detail below.
12 The term ‘‘Priority Customer Order’’ means an
order for the account of a Priority Customer. See
Exchange Rule 100.
13 For purposes of the MIAX Options Fee
Schedule, the term ‘‘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, (‘‘Affiliate’’), 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
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
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purposes of the thresholds described in
the PCRP table.
Currently, Members and their
Affiliates that qualify for the PCRP and
execute Priority Customer simple orders
in MIAX Select Symbols receive the
following rebates: (i) $0.00 per contract
in Tier 1; (ii) $0.10 per contract in Tier
2; (iii) $0.20 per contract in Tier 3; and
(iv) $0.24 in Tier 4. The Exchange now
proposes to reduce the rebate provided
in Tier 3 from $0.20 to $0.18. The
purpose of adjusting the Tier 3 rebate is
for business and competitive reasons.
Per Contract Credit for cPRIME Agency
Orders
Exchange Rule 518(b)(7) defines a
cPRIME Order as a type of complex
order 14 that is submitted for
participation in a cPRIME Auction and
trading of cPRIME Orders is governed
by Rule 515A, Interpretation and
Policies .12.15 cPRIME Orders are
(who does not otherwise have a corporate affiliation
based upon common ownership with a MIAX
Market Maker) that has been appointed by a MIAX
Market Maker, pursuant to the following process. A
MIAX Market Maker appoints an EEM and an EEM
appoints a MIAX 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 Fee Schedule,
note 1.
14 A ‘‘complex order’’ is any order involving the
concurrent purchase and/or sale of two or more
different options in the same underlying security
(the ‘‘legs’’ or ‘‘components’’ of the complex order),
for the same account, in a ratio that is equal to or
greater than one-to-three (.333) and less than or
equal to three-to-one (3.00) and for the purposes of
executing a particular investment strategy. A
complex order can also be a ‘‘stock-option’’ order,
which is an order to buy or sell a stated number
of units of an underlying security coupled with the
purchase or sale of options contract(s) on the
opposite side of the market, subject to certain
contingencies set forth in the proposed rules
governing complex orders. For a complete
definition of a ‘‘complex order,’’ see Exchange Rule
518(a)(5). See also Securities Exchange Act Release
No. 78620 (August 18, 2016), 81 FR 58770 (August
25, 2016) (SR–MIAX–2016–26).
15 See Securities Exchange Act Release No. 81131
(July 12, 2017), 82 FR 32900 (July 18, 2017) (SR–
MIAX–2017–19) (Order Granting Approval of a
Proposed Rule Change to Amend MIAX Options
Rules 515, Execution of Orders and Quotes; 515A,
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processed and executed in the
Exchange’s PRIME mechanism, the
same mechanism that the Exchange uses
to process and execute simple PRIME
orders, pursuant to Exchange Rule
515A.16 PRIME is a process by which a
Member may electronically submit for
execution an order it represents as agent
(an ‘‘Agency Order’’) against principal
interest and/or solicited interest. The
Member that submits the Agency Order
(‘‘Initiating Member’’) agrees to
guarantee the execution of the Agency
Order by submitting a contra-side order
representing principal interest or
solicited interest (‘‘Contra-Side Order’’).
When the Exchange receives a properly
designated Agency Order for Auction
processing, a request for response
(‘‘RFR’’) detailing the option, side, size
and initiating price is broadcasted to
MIAX participants up to an optional
designated limit price. Members may
submit responses to the RFR, which can
be either an Auction or Cancel (‘‘AOC’’)
order or an AOC eQuote. A cPRIME
Auction is the price-improvement
mechanism of the Exchange’s System
pursuant to which an Initiating Member
electronically submits a complex
Agency Order into a cPRIME Auction.
The Initiating Member, in submitting an
Agency Order, must be willing to either
(i) cross the Agency Order at a single
price against principal or solicited
interest, or (ii) automatically match
against principal or solicited interest,
the price and size of a RFR that is
broadcast to MIAX participants up to an
optional designated limit price. Such
responses are defined as cPRIME AOC
Responses or cPRIME eQuotes. The
PRIME mechanism is used for orders on
the Exchange’s Simple Order Book. The
cPRIME mechanism is used for complex
orders 17 on the Exchange’s Strategy
Book,18 with the cPRIME mechanism
operating in the same manner for
processing and execution of cPRIME
Orders that is used for PRIME Orders on
the Simple Order Book.
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Proposal
Currently, Members and their
Affiliates that qualify for the PCRP that
MIAX Price Improvement Mechanism (‘‘PRIME’’)
and PRIME Solicitation Mechanism; and 518,
Complex Orders).
16 Id.
17 Only those complex orders in the classes
designated by the Exchange and communicated to
Members via Regulatory Circular with no more than
the applicable number of legs, as determined by the
Exchange on a class-by-class basis and
communicated to Members via Regulatory Circular,
are eligible for processing. See Exchange Rule
518(a)(5).
18 The ‘‘Strategy Book’’ is the Exchange’s
electronic book of complex orders and complex
quotes. See Exchange Rule 518(a)(17).
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execute cPRIME Agency Orders with a
maximum leg size equal to or less than
1,000 contracts receive $0.10 per
contract in Tier 1 through Tier 4, or
$0.12 in Tier 4 provided certain criteria
is satisfied as denoted by footnote
‘‘**’’.19 The Exchange also provides a
separate per contract credit for cPRIME
Agency Orders with a max leg size of
more than 1,000 contracts, which is
based upon the order break-up
percentage. Specifically, the Per
Contract Credit for cPRIME Agency
Order table provides for the following
rebates: (i) $0.05 when the order breakup percentage is 0–10%; (ii) $0.06 when
the order break-up percentage is greater
than 10%–20%; (iii) $0.07 when the
order break-up percentage is greater
than 20%–30%; (iv) $0.08 when the
order break-up percentage is greater
than 30%–40%; (v) $0.10 when the
order break-up percentage is greater
than 40%–50% (or $0.12 if the Member
or their Affiliate qualifies for Tier 4 and
satisfies the additional criteria denoted
in footnote ‘‘**’’); 20 (vi) $0.10 when the
order break-up percentage is greater
than 50%–60% (or $0.12 if the Member
or their Affiliate qualifies for Tier 4 and
satisfies the additional criteria denoted
in footnote ‘‘**’’); (vii) $0.10 when the
order break-up percentage is greater
than 60%–70% (or $0.12 if the Member
or their Affiliate qualifies for Tier 4 and
satisfies the additional criteria denoted
in footnote ‘‘**’’); (viii) $0.10 when the
order break-up percentage is greater
than 70%–80% (or $0.12 if the Member
or their Affiliate qualifies for Tier 4 and
satisfies the additional criteria denoted
in footnote ‘‘**’’); (ix) $0.10 when the
order break-up percentage is greater
than 80%–90% (or $0.12 if the Member
or their Affiliate qualifies for Tier 4 and
satisfies the additional criteria denoted
in footnote ‘‘**’’); and (x) $0.10 when
the order break-up percentage is greater
than 90%–100% (or $0.12 if the
Member or their Affiliate qualifies for
Tier 4 and satisfies the additional
criteria denoted in footnote ‘‘**’’).
The Exchange now proposes to
provide that all cPRIME Agency Orders
will be eligible for the per contract
credit described in the Per Contract
Credit for cPRIME Agency Order table
by removing the maximum leg size
requirement from that table. The
Exchange also proposes to rename this
table as the cPRIME Agency Order
Break-up Table for clarity. Therefore,
the Exchange proposes to remove the
credit amounts for the per contract
credits listed in the Per Contract Credit
for cPRIME Agency Order column of the
standard PCRP table in Section 1)a)iii)
of the Fee Schedule. The Exchange then
proposes to direct market participants to
the proposed ‘‘cPRIME Agency Order
Break-Up Table,’’ which can be found in
the Fee schedule below the standard
PCRP table, by inserting the sentence,
‘‘See cPRIME Agency Order Break-up
Table Below’’ in each row for the ‘‘Per
Contract Credit for cPRIME Agency
Order’’ in the standard PCRP table.
Accordingly, with the proposed
changes, all cPRIME Agency Orders that
qualify for the PCRP that are submitted
to the Exchange would be eligible for
the per contract credit based upon the
order break-up percentage as described
in the above mentioned table. The
Exchange conducted an internal
analysis of fees and rebates associated
with cPRIME Agency Orders and the
proposed changes are being made for
business and competitive reasons.
As a result of the aforementioned
proposed change, the Exchange also
proposes to remove the following
footnote ‘‘*’’ to the above mentioned
table and to amend footnote ‘‘**’’ to
clarify the operation of the per contract
credit described in the footnote and to
also amend footnote ‘‘***’’ to remove
the maximum leg size requirement to
accurately reflect the operation of the
table.
The Exchange currently provides a
cPRIME break-up credit of $0.25 per
contract in Penny Classes 21 and $0.60
per contract in Non-Penny Classes.22
Additionally, the Exchange provides an
enhanced PRIME break-up credit of
$0.28 per contract in Penny Classes and
$0.72 per contract in Non-Penny Classes
to the Electronic Exchange Member
(‘‘EEM’’) 23 that submitted a cPRIME
Order that trades with cPRIME AOC
Responses and/or cPRIME participating
quotes or orders, if the cPRIME Order
experiences a break-up of greater than
60%, which is not changing under this
proposal.24
21 See
Exchange Rule 510(c).
Section 1)a)vi) MIAX Complex Price
Improvement Mechanism (‘‘cPRIME’’) Fees, of the
Exchange’s Fee Schedule.
23 The term ‘‘Electronic Exchange Member’’ or
‘‘EEM’’ means the holder of a Trading Permit who
is not a Market Maker. Electronic Exchange
Members are deemed ‘‘members’’ under the
Exchange Act. See Exchange Rule 100.
24 See the Exchange’s Fee schedule, footnote ‘‘*’’
of Section 1)a)vi), on its public website (available
at https://www.miaxoptions.com/fees).
22 See
19 Footnote ‘‘**’’ provides that, any Member or its
Affiliate that qualifies for Priority Customer Rebate
Program tier 4 and executes Priority Customer
standard, non-paired complex volume at least equal
to or greater than three (3) times their Priority
Customer cPRIME Agency Order volume, on a
monthly basis, will receive a credit of $0.12 per
contract for cPRIME Agency Orders instead of the
credit otherwise applicable to such orders in tier 4.
20 Id.
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2. Statutory Basis
The Exchange believes that its
proposal to amend its Fee Schedule is
consistent with section 6(b) of the Act 25
in general, and furthers the objectives of
section 6(b)(4) of the Act 26 in particular,
in that it is an equitable allocation of
reasonable dues, fees, and other charges
among its members and issuers and
other persons using its facilities. The
Exchange also believes the proposal
furthers the objectives of section 6(b)(5)
of the Act 27 in that it is designed to
promote just and equitable principles of
trade, to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system, and, in general, to protect
investors and the public interest and is
not designed to permit unfair
discrimination between customers,
issuers, brokers and dealers.
The Exchange believes its proposal
provides for the equitable allocation of
reasonable dues and fees and is not
unfairly discriminatory for the following
reasons. The Exchange operates in a
highly competitive market in which
market participants can readily direct
order flow to competing venues if they
deem fee levels at a particular venue to
be excessive or incentives to be
insufficient. More specifically, the
Exchange is one of 16 registered options
exchanges competing for order flow.
Based on publicly-available
information, and excluding index-based
options, no single exchange has more
than approximately 12–13% of the
market share of executed volume of
multiply-listed equity and exchangetraded fund (‘‘ETF’’) options trades as of
January 26, 2023, for the month of
January 2023.28 Therefore, no exchange
possesses significant pricing power in
the execution of multiply-listed equity
and ETF options order flow. More
specifically, as of January 26, 2023, the
Exchange has a total market share of
6.45% of all equity options volume, for
the month of January 2023.29
The Exchange believes that the evershifting market share among the
exchanges from month to month
demonstrates that market participants
can shift order flow, or discontinue use
of certain categories of products, in
response to fee changes. For example,
on March 1, 2019, the Exchange filed
with the Commission an immediately
effective filing to decrease certain
25 15
U.S.C. 78f(b).
U.S.C. 78f(b)(4).
27 15 U.S.C. 78f(b)(5).
28 See ‘‘The market at a glance/MTD AVERAGE’’,
available at https://www.miaxoptions.com/ (data as
of 1/1/2023–1/25/2023).
29 See id.
26 15
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credits assessable to Members pursuant
to the PCRP.30 The Exchange
experienced a decrease in total market
share between the months of February
and March of 2019. Accordingly, the
Exchange believes that the March 1,
2019, fee change may have contributed
to the decrease in the Exchange’s market
share and, as such, the Exchange
believes competitive forces constrain
options exchange transaction and nontransaction fees.
Accordingly, competitive forces
constrain the Exchange’s transaction
fees, and market participants can readily
trade on competing venues if they deem
pricing levels at those other venues to
be more favorable. In response to the
competitive environment, the Exchange
offers specific rates and credits in its
fees schedule, like those of other
options exchanges’ fees schedules,
which the Exchange believes provides
incentives to Members to increase order
flow of certain qualifying orders.
The Exchange believes that the PCRP
itself is reasonably designed because it
incentivizes providers of Priority
Customer order flow to send that
Priority Customer order flow to the
Exchange in order to receive a credit in
a manner that enables the Exchange to
improve its overall competitiveness and
strengthen its market quality for all
market participants. The PCRP, which
provides increased incentives in certain
tiers in high volume select symbols, is
also reasonably designed to increase the
competitiveness of the Exchange with
other options exchanges that also offer
increased incentives (e.g., lower fees or
higher rebates) to higher volume
symbols.31
The Exchange believes that its
proposal to amend the rebate provided
for Priority Customer Orders in MIAX
Select Symbols in Tier 3 is consistent
with section 6(b)(4) of the Act 32 in that
the proposal is reasonable, equitable
and not unfairly discriminatory as it
applies uniformly to all similarly
situated participants. The Exchange
believes the proposed change (a $0.02
decrease from the current rebate) is
reasonable in that it represents a modest
decrease from the current rebate provide
in Tier 3. The Exchange believes that
the proposed rebate will continue to
provide an incentive to participants to
submit Priority Customer Orders in
MIAX Select Symbols. The Exchange
believes that even with the proposed
30 See Securities Exchange Act Release No. 85301
(March 13, 2019), 84 FR 10166 (March 19, 2019)
(SR–MIAX–2019–09).
31 See Nasdaq ISE Fee Schedule, Options 7,
Section 3. Regular Order Fees and Rebates, Select
Symbols.
32 15 U.S.C. 78f(b)(4).
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reduced credit in Tier 3, the Exchange’s
credits for the PCRP remain in line with,
or higher than, competing exchanges’
credits for similar programs.33 The
Exchange also believes that its proposal
is consistent with section 6(b)(5) of the
Act because it will apply equally to all
Priority Customer Orders in Tier 3. All
similarly situated participants are
subject to the same rebate schedule, and
access to the Exchange is offered on
terms that are not unfairly
discriminatory.
The Exchange believes that its
proposal to provide a per contract credit
for all cPRIME Agency Orders based
upon the order break-up percentage will
continue to encourage Priority Customer
order flow to auctions. Increased
Priority Customer order flow benefits all
market participants because it continues
to attract liquidity to the Exchange by
providing more trading opportunities.
This attracts Market Makers and other
liquidity providers, thus, facilitating
price improvement in the auction
process, signaling additional
corresponding order flow from other
market participants, and, as a result,
increasing liquidity on the Exchange.
The Exchange believes that its
proposal is consistent with section
6(b)(4) of the Act 34 in that the proposal
is reasonable, equitable and not unfairly
discriminatory as it applies uniformly to
all similarly situated participants. The
Exchange believes the PCRP is
reasonably designed because it will
provide an incentive to providers of
Priority Customer order flow to send
that Priority Customer order follow to
the Exchange to receive a credit in a
manner that enables the Exchange to
improve its overall competiveness and
strengthen its market quality for all
participants.
The Exchange’s proposal to provide a
per contract credit to eligible cPRIME
Agency Orders based upon the order
break-up percentage is consistent with
section 6(b)(4) of the Act 35 because it
applies equally to all participants of the
PCRP that submit cPRIME Agency
Orders. The Exchange believes that the
proposed rebate structure is fair,
equitable, and not unreasonably
discriminatory. The PCRP is reasonably
designed because it will provide an
incentive to providers of Priority
Customer order flow to send that
33 See NYSE American Options Fee Schedule,
Section I.E., American Customer Engagement
(‘‘ACE’’) Program (providing a simple credit of
$0.17 in Tier 3); see also Cboe Exchange, Inc.
Options Fee Schedule, Page 3, Volume Incentive
Program (‘‘VIP’’) (providing a simple Non-AIM
rebate of $0.12 in Tier 3).
34 15 U.S.C. 78f(b)(4).
35 15 U.S.C. 78f(b)(4).
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Priority Customer order flow to the
Exchange to receive a credit in a manner
that enables the Exchange to improve its
overall competitiveness and strengthen
its market quality for all participants.
In addition, the Exchange believes
that its proposal is consistent with
section 6(b)(5) of the Act 36 because it
perfects the mechanisms of a free and
open market and a national market
system and protects investors and the
public interest because an increase in
Priority Customer order flow will bring
greater volume and liquidity to the
Exchange, which benefits all market
participants by providing more trading
opportunities and tighter spreads. To
the extent Priority Customer order flow
is increased by this proposal, market
participants will increasingly compete
for the opportunity to trade on the
Exchange including sending more
orders and provided narrower and
larger-sized quotations in the effort to
trade with such Priority Customer Order
flow.
The Exchange believes that providing
rebates for Priority Customers that
submit cPRIME Agency Orders is
equitable and not unfairly
discriminatory because the proposed
rebate schedule will apply equally to all
cPRIME Agency Orders for Priority
Customers. The Exchange believes that
the application of the rebate is equitable
and not unfairly discriminatory because,
as stated above, Customer order flow
enhances liquidity on the Exchange, in
turn providing more trading
opportunities and attracting other
market participants, thus, facilitating
tighter spreads, increased order flow
and trading opportunities to the benefit
of all market participants. Moreover, the
options industry has a long history of
providing preferential pricing to Priority
Customer Orders, and the Exchange’s
current fees schedule currently does so
in many places, as does the fee structure
of at least one other exchange.37
As noted above, the Exchange
operates in a highly competitive market.
The Exchange is only one of several
options venues to which market
participants may direct their order flow,
and it represents a small percentage of
the overall market. The Exchange
believes that the proposed fees are
reasonable, equitable, and not unfairly
discriminatory in that competing
options exchanges offer similar fees and
credits in connection with similar price
improvement auctions.38
U.S.C. 78f(b)(5).
Cboe Fee Schedule, ‘‘Break-Up Credits,’’
available at https://cdn.cboe.com/resources/
membership/Cboe_FeeSchedule.pdf.
38 Id.
9559
B. Self-Regulatory Organization’s
Statement on Burden on Competition
In accordance with section 6(b)(8) of
the Act,41 the Exchange does not believe
that the proposed rule change will
impose any burden on intra-market or
intra-market competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. Rather, as
discussed above, the Exchange believes
that the proposed changes will
encourage the submission of additional
liquidity to price improvement auctions,
thereby promoting market depth, price
discovery, transparency, and enhanced
order execution and price improvement
opportunities for all Members. As a
result, the Exchange believes that the
proposed change furthers the
Commission’s goal in adopting
Regulation NMS of fostering
competition among orders, which
promotes ‘‘more efficient pricing of
individual stocks for all types of orders,
large and small.’’ 42
The Exchange does not believe that its
proposal will impose any burden on
intra-market competition that is not
necessary or appropriate in furtherance
of the purposes of the Act because the
proposed changes will apply uniformly
to all eligible Priority Customers. The
Exchange believes that this proposal
will continue to encourage Members to
submit cPRIME Agency Orders for
Priority Customers, which will increase
liquidity and benefit all market
participants by providing more trading
opportunities and tighter spreads. The
Exchange notes the fact that preferential
pricing to Priority Customers is a longstanding options industry practice. The
proposed rebate changes serve to
enhance Priority Customer order flow to
the Exchange’s Price Improvement
Mechanism, which, as a result,
facilitates increased liquidity and
execution opportunities to the benefit of
all market participants.
Additionally, the Exchange does not
believe its proposal to reduce the Tier
3 rebate for MIAX Select Symbols will
impose any burden on intra-market
competition that is not necessary or
appropriate in furtherance of the
purposes of the Act because the
proposed change will apply uniformly
to all similarly situated participants.
The Exchange also does not believe
that its proposal will impose any burden
on inter-market competition that is not
necessary or appropriate in furtherance
of the purposes of the Act because, as
noted above, at least one other
competing options exchange 43 has
similar rebates in place in connection
with similar price improvement
auctions. Additionally, and as
previously discussed, the Exchange
operates in a highly competitive market.
Members have numerous alternative
venues that they participate on and
direct their order flow to, including 15
other options exchanges, many of which
offer substantially similar price
improvement auctions. Based on
publicly available information, no single
options exchange has more than
39 See Securities Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496 (June 29, 2005).
40 15 U.S.C. 78f(b)(4) and (5).
41 15 U.S.C. 78f(b)(8).
42 See Securities Exchange Act Release No. 51808,
70 FR 37495, 37498–99 (June 29, 2005) (S7–10–04)
(Final Rule).
43 See supra note 37.
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 selfregulatory organization (‘‘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.’’ 39
The Exchange believes that the evershifting market shares among the
exchanges from month to month
demonstrates that market participants
can shift order flow or discontinue or
reduce use of certain categories of
products, in response to transaction and
non-transaction fee changes.
Accordingly, competitive forces
constrain the Exchange’s transaction
fees and rebates, and market
participants can readily trade on
competing venues if they deem pricing
levels at those other venues to be more
favorable. The Exchange believes the
proposal reflects a reasonable and
competitive pricing structure which will
continue to incentivize market
participants to direct Priority Customer
Orders to the Exchange, which the
Exchange believes will enhance
liquidity and market quality on the
exchange to the benefit of all Members.
For the reasons discussed above, the
Exchange submits that the proposal
satisfies the requirements of sections
6(b)(4) and 6(b)(5) of the Act 40 in that
it provides for the equitable allocation
of reasonable dues, fees and other
charges among its Members and other
persons using its facilities and is not
designed to unfairly discriminate
between customers, issuers, brokers, or
dealers.
36 15
37 See
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ddrumheller on DSK120RN23PROD with NOTICES
approximately 12–13% of the equity
options market share.44 Therefore, no
exchange possesses significant pricing
power in the execution of option order
flow. Participants can readily choose to
send their orders to other exchanges if
they deem fee levels at those other
exchanges to be more favorable.
Moreover, the Commission has
repeatedly expressed its preference for
competition over regulatory
intervention in determining prices,
products, and services in the securities
markets. Specifically, 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.’’ 45 The
fact that this market is competitive has
also long been recognized by the courts.
In NetCoalition v. Securities and
Exchange Commission, the D.C. Circuit
states as follows: ‘‘[n]o one disputes that
competition for order flow is ‘fierce.’
. . . As the SEC explained, ‘[i]n the U.S.
national market system, buyers and
sellers of securities, and the brokerdealers that act as their order-routing
agents, have a wide range of choices of
where to route orders for execution’;
[and] ‘no exchange can afford to take its
market share percentages for granted’
because ‘no exchange possesses a
monopoly, regulatory or otherwise, in
the execution of order flow from broker
dealers’ . . .’’ 46 Accordingly, the
Exchange does not believe its proposed
fee change imposes any burden on
competition that is not necessary or
appropriate in furtherance of the
purposes of the Act.
Accordingly, the Exchange believes
that the proposed changes will not
impose any burden on competition that
is not necessary or appropriate in
furtherance of the purposes of the Act
because it will continue to encourage
order flow, which provides greater
volume and liquidity, benefiting all
market participants by providing more
trading opportunities and tighter
spreads.
44 See
supra note 28.
Securities Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005).
46 NetCoalition v. SEC, 615 F.3d 525, 539 (D.C.
Cir. 2010) (quoting Securities Exchange Act Release
No. 59039 (December 2, 2008), 73 FR 74770, 74782–
83 (December 9, 2008) (SR–NYSEArca–2006–21)).
45 See
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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,47 and Rule
19b–4(f)(2) 48 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 Number SR–
MIAX–2023–03 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–MIAX–2023–03. 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–MIAX–2023–03 and should
be submitted on orbefore March 7, 2023.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.49
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023–03055 Filed 2–13–23; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–96842; File No. SR–MSRB–
2023–02]
Self-Regulatory Organizations;
Municipal Securities Rulemaking
Board; Notice of Filing of a Proposed
Rule Change To Create New MSRB
Rule G–46, on Duties of Solicitor
Municipal Advisors, and To Amend
MSRB Rule G–8, on Books and
Records
February 8, 2023.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (‘‘Act’’
or ‘‘Exchange Act’’) 1 and Rule 19b–4
thereunder,2 notice is hereby given that
on January 31, 2023, the Municipal
Securities Rulemaking Board (‘‘MSRB’’
or ‘‘Board’’) filed with the Securities
and Exchange Commission (‘‘SEC’’ or
‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
prepared by the MSRB. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
49 17
47 15
U.S.C. 78s(b)(3)(A)(ii).
48 17 CFR 240.19b–4(f)(2).
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CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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]]>Agencies
[Federal Register Volume 88, Number 30 (Tuesday, February 14, 2023)]
[Notices]
[Pages 9555-9560]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-03055]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-96835; File No. SR-MIAX-2023-03]
Self-Regulatory Organizations: Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change by Miami International Securities Exchange LLC To
Amend Its Fee Schedule
February 8, 2023.
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 January 31, 2023, Miami International
Securities Exchange LLC (``MIAX'' 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 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, at MIAX's principal
office, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
[[Page 9556]]
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 Section 1)a)iii) of the Fee Schedule
to modify the Priority Customer Rebate Program (``PCRP'') \3\ to (i)
reduce the per contract credit for Simple Orders \4\ in MIAX Select
Symbols in Tier 3 of the PCRP; \5\ (ii) modify the PCRP table to
reflect that the per contract credit for cPRIME Agency Orders will be
based upon the per Contract Credit for cPRIME Agency Order table (to be
renamed the ``cPRIME Agency Order Break-up Table''); (iii) modify the
Per Contract Credit for cPRIME Agency Order table to remove the maximum
leg size requirement; and (iv) rename the Per Contract Credit for
cPRIME Agency Order table to the cPRIME Agency Order Break-up Table.
---------------------------------------------------------------------------
\3\ Under the PCRP, MIAX credits each Member the per contract
amount resulting from each Priority Customer order transmitted by
that Member which is executed electronically on the Exchange in all
multiply-listed option classes (excluding, in simple or complex as
applicable, QCC and cQCC Orders, mini-options, Priority Customer-to-
Priority Customer Orders, C2C and cC2C Orders, PRIME and cPRIME AOC
Responses, PRIME and cPRIME Contra-side Orders, PRIME and cPRIME
Orders for which both the Agency and Contra-side Order are Priority
Customers, and executions related to contracts that are routed to
one or more exchanges in connection with the Options Order
Protection and Locked/Crossed Market Plan referenced in Exchange
Rule 1400), provided the Member meets certain percentage thresholds
in a month as described in the Priority Customer Rebate Program
table. See Fee Schedule, Section 1)a)iii. The term ``Member'' means
an individual or organization approved to exercise the trading
rights associated with a Trading Permit. Members are deemed
``members'' under the Exchange Act. See Exchange Rule 100.
\4\ The ``Simple Order Book'' is the Exchange's regular
electronic book of orders and quotes. See Exchange Rule 518(a)(15).
\5\ The term ``MIAX Select Symbols'' means options overlying
AAL, AAPL, AMAT, AMD, AMZN, BA, BABA, BB, BIDU, BP, C, CAT, CLF,
CVX, DAL, EBAY, EEM, FCX, GE, GILD, GLD, GM, GOOGL, GPRO, HAL, INTC,
IWM, JNJ, JPM, KMI, KO, META, MO, MRK, NFLX, NOK, ORCL, PBR, PFE,
PG, QCOM, QQQ, RIG, SPY, T, TSLA, USO, VALE, WBA, WFC, WMB, X, XHB,
XLE, XLF, XLP, XOM and XOP. See Fee Schedule, Section 1)a)iii), note
14.
---------------------------------------------------------------------------
The proposed changes will be effective on February 1, 2023.
Background
Priority Customer Rebate Program
The Exchange's Fee Schedule provides for a Priority Customer Rebate
Program, under which a Priority Customer \6\ rebate payment is
calculated from the first executed contract at the applicable threshold
per contract credit with rebate payments made at the highest achieved
volume tier for each contract traded in that month. The percentage
thresholds are calculated based on the percentage of national customer
volume in multiply-listed option classes listed on MIAX entered and
executed over the course of the month (excluding QCC \7\ and cQCC
Orders,\8\ Priority Customer-to-Priority Customer Orders, C2C,\9\ and
cC2C Orders,\10\ PRIME and cPRIME AOC Responses, PRIME and cPRIME
Contra-side Orders, and PRIME and cPRIME Orders \11\ for which both the
Agency and Contra-side Order are Priority Customers). Volume for
transactions in both simple and complex orders are aggregated to
determine the appropriate volume tier threshold applicable to each
transaction. Volume is recorded for, and credits are delivered to, the
Member that submits the order to MIAX. MIAX aggregates the contracts
resulting from Priority Customer Orders \12\ transmitted and executed
electronically on MIAX from Members and Affiliates \13\ for purposes of
the thresholds described in the PCRP table.
---------------------------------------------------------------------------
\6\ 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 account(s). See Exchange Rule
100.
\7\ A Qualified Contingent Cross Order is comprised of an
originating order to buy or sell at least 1,000 contracts, or 10,000
mini-option contracts, that is identified as being part of a
qualified contingent trade, as that term is defined in
Interpretations and Policies .01 below, coupled with a contra-side
order or orders totaling an equal number of contracts. See Exchange
Rule 516(j).
\8\ A Complex Qualified Contingent Cross or ``cQCC'' Order is
comprised of an originating complex order to buy or sell where each
component is at least 1,000 contracts that is identified as being
part of a qualified contingent trade, as defined in Rule 516,
Interpretations and Policies .01, coupled with a contra-side complex
order or orders totaling an equal number of contracts. Trading of
cQCC Orders is governed by Rule 515(h)(4). See Exchange Rule
518(b)(6).
\9\ A Customer Cross Order is comprised of a Priority Customer
Order to buy and a Priority Customer Order to sell at the same price
and for the same quantity. See Exchange Rule 516(i).
\10\ A Complex Customer Cross or ``cC2C'' Order is comprised of
one Priority Customer complex order to buy and one Priority Customer
complex order to sell at the same price and for the same quantity.
Trading of cC2C Orders is governed by Rule 515(h)(3). See Exchange
Rule 518(b)(5).
\11\ PRIME and cPRIME Orders are described in more detail below.
\12\ The term ``Priority Customer Order'' means an order for the
account of a Priority Customer. See Exchange Rule 100.
\13\ For purposes of the MIAX Options Fee Schedule, the term
``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, (``Affiliate''), 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
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
Market Maker) that has been appointed by a MIAX Market Maker,
pursuant to the following process. A MIAX Market Maker appoints an
EEM and an EEM appoints a MIAX 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 Fee Schedule, note 1.
---------------------------------------------------------------------------
Currently, Members and their Affiliates that qualify for the PCRP
and execute Priority Customer simple orders in MIAX Select Symbols
receive the following rebates: (i) $0.00 per contract in Tier 1; (ii)
$0.10 per contract in Tier 2; (iii) $0.20 per contract in Tier 3; and
(iv) $0.24 in Tier 4. The Exchange now proposes to reduce the rebate
provided in Tier 3 from $0.20 to $0.18. The purpose of adjusting the
Tier 3 rebate is for business and competitive reasons.
Per Contract Credit for cPRIME Agency Orders
Exchange Rule 518(b)(7) defines a cPRIME Order as a type of complex
order \14\ that is submitted for participation in a cPRIME Auction and
trading of cPRIME Orders is governed by Rule 515A, Interpretation and
Policies .12.\15\ cPRIME Orders are
[[Page 9557]]
processed and executed in the Exchange's PRIME mechanism, the same
mechanism that the Exchange uses to process and execute simple PRIME
orders, pursuant to Exchange Rule 515A.\16\ PRIME is a process by which
a Member may electronically submit for execution an order it represents
as agent (an ``Agency Order'') against principal interest and/or
solicited interest. The Member that submits the Agency Order
(``Initiating Member'') agrees to guarantee the execution of the Agency
Order by submitting a contra-side order representing principal interest
or solicited interest (``Contra-Side Order''). When the Exchange
receives a properly designated Agency Order for Auction processing, a
request for response (``RFR'') detailing the option, side, size and
initiating price is broadcasted to MIAX participants up to an optional
designated limit price. Members may submit responses to the RFR, which
can be either an Auction or Cancel (``AOC'') order or an AOC eQuote. A
cPRIME Auction is the price-improvement mechanism of the Exchange's
System pursuant to which an Initiating Member electronically submits a
complex Agency Order into a cPRIME Auction. The Initiating Member, in
submitting an Agency Order, must be willing to either (i) cross the
Agency Order at a single price against principal or solicited interest,
or (ii) automatically match against principal or solicited interest,
the price and size of a RFR that is broadcast to MIAX participants up
to an optional designated limit price. Such responses are defined as
cPRIME AOC Responses or cPRIME eQuotes. The PRIME mechanism is used for
orders on the Exchange's Simple Order Book. The cPRIME mechanism is
used for complex orders \17\ on the Exchange's Strategy Book,\18\ with
the cPRIME mechanism operating in the same manner for processing and
execution of cPRIME Orders that is used for PRIME Orders on the Simple
Order Book.
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\14\ A ``complex order'' is any order involving the concurrent
purchase and/or sale of two or more different options in the same
underlying security (the ``legs'' or ``components'' of the complex
order), for the same account, in a ratio that is equal to or greater
than one-to-three (.333) and less than or equal to three-to-one
(3.00) and for the purposes of executing a particular investment
strategy. A complex order can also be a ``stock-option'' order,
which is an order to buy or sell a stated number of units of an
underlying security coupled with the purchase or sale of options
contract(s) on the opposite side of the market, subject to certain
contingencies set forth in the proposed rules governing complex
orders. For a complete definition of a ``complex order,'' see
Exchange Rule 518(a)(5). See also Securities Exchange Act Release
No. 78620 (August 18, 2016), 81 FR 58770 (August 25, 2016) (SR-MIAX-
2016-26).
\15\ See Securities Exchange Act Release No. 81131 (July 12,
2017), 82 FR 32900 (July 18, 2017) (SR-MIAX-2017-19) (Order Granting
Approval of a Proposed Rule Change to Amend MIAX Options Rules 515,
Execution of Orders and Quotes; 515A, MIAX Price Improvement
Mechanism (``PRIME'') and PRIME Solicitation Mechanism; and 518,
Complex Orders).
\16\ Id.
\17\ Only those complex orders in the classes designated by the
Exchange and communicated to Members via Regulatory Circular with no
more than the applicable number of legs, as determined by the
Exchange on a class-by-class basis and communicated to Members via
Regulatory Circular, are eligible for processing. See Exchange Rule
518(a)(5).
\18\ The ``Strategy Book'' is the Exchange's electronic book of
complex orders and complex quotes. See Exchange Rule 518(a)(17).
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Proposal
Currently, Members and their Affiliates that qualify for the PCRP
that execute cPRIME Agency Orders with a maximum leg size equal to or
less than 1,000 contracts receive $0.10 per contract in Tier 1 through
Tier 4, or $0.12 in Tier 4 provided certain criteria is satisfied as
denoted by footnote ``**''.\19\ The Exchange also provides a separate
per contract credit for cPRIME Agency Orders with a max leg size of
more than 1,000 contracts, which is based upon the order break-up
percentage. Specifically, the Per Contract Credit for cPRIME Agency
Order table provides for the following rebates: (i) $0.05 when the
order break-up percentage is 0-10%; (ii) $0.06 when the order break-up
percentage is greater than 10%-20%; (iii) $0.07 when the order break-up
percentage is greater than 20%-30%; (iv) $0.08 when the order break-up
percentage is greater than 30%-40%; (v) $0.10 when the order break-up
percentage is greater than 40%-50% (or $0.12 if the Member or their
Affiliate qualifies for Tier 4 and satisfies the additional criteria
denoted in footnote ``**''); \20\ (vi) $0.10 when the order break-up
percentage is greater than 50%-60% (or $0.12 if the Member or their
Affiliate qualifies for Tier 4 and satisfies the additional criteria
denoted in footnote ``**''); (vii) $0.10 when the order break-up
percentage is greater than 60%-70% (or $0.12 if the Member or their
Affiliate qualifies for Tier 4 and satisfies the additional criteria
denoted in footnote ``**''); (viii) $0.10 when the order break-up
percentage is greater than 70%-80% (or $0.12 if the Member or their
Affiliate qualifies for Tier 4 and satisfies the additional criteria
denoted in footnote ``**''); (ix) $0.10 when the order break-up
percentage is greater than 80%-90% (or $0.12 if the Member or their
Affiliate qualifies for Tier 4 and satisfies the additional criteria
denoted in footnote ``**''); and (x) $0.10 when the order break-up
percentage is greater than 90%-100% (or $0.12 if the Member or their
Affiliate qualifies for Tier 4 and satisfies the additional criteria
denoted in footnote ``**'').
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\19\ Footnote ``**'' provides that, any Member or its Affiliate
that qualifies for Priority Customer Rebate Program tier 4 and
executes Priority Customer standard, non-paired complex volume at
least equal to or greater than three (3) times their Priority
Customer cPRIME Agency Order volume, on a monthly basis, will
receive a credit of $0.12 per contract for cPRIME Agency Orders
instead of the credit otherwise applicable to such orders in tier 4.
\20\ Id.
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The Exchange now proposes to provide that all cPRIME Agency Orders
will be eligible for the per contract credit described in the Per
Contract Credit for cPRIME Agency Order table by removing the maximum
leg size requirement from that table. The Exchange also proposes to
rename this table as the cPRIME Agency Order Break-up Table for
clarity. Therefore, the Exchange proposes to remove the credit amounts
for the per contract credits listed in the Per Contract Credit for
cPRIME Agency Order column of the standard PCRP table in Section
1)a)iii) of the Fee Schedule. The Exchange then proposes to direct
market participants to the proposed ``cPRIME Agency Order Break-Up
Table,'' which can be found in the Fee schedule below the standard PCRP
table, by inserting the sentence, ``See cPRIME Agency Order Break-up
Table Below'' in each row for the ``Per Contract Credit for cPRIME
Agency Order'' in the standard PCRP table. Accordingly, with the
proposed changes, all cPRIME Agency Orders that qualify for the PCRP
that are submitted to the Exchange would be eligible for the per
contract credit based upon the order break-up percentage as described
in the above mentioned table. The Exchange conducted an internal
analysis of fees and rebates associated with cPRIME Agency Orders and
the proposed changes are being made for business and competitive
reasons.
As a result of the aforementioned proposed change, the Exchange
also proposes to remove the following footnote ``*'' to the above
mentioned table and to amend footnote ``**'' to clarify the operation
of the per contract credit described in the footnote and to also amend
footnote ``***'' to remove the maximum leg size requirement to
accurately reflect the operation of the table.
The Exchange currently provides a cPRIME break-up credit of $0.25
per contract in Penny Classes \21\ and $0.60 per contract in Non-Penny
Classes.\22\ Additionally, the Exchange provides an enhanced PRIME
break-up credit of $0.28 per contract in Penny Classes and $0.72 per
contract in Non-Penny Classes to the Electronic Exchange Member
(``EEM'') \23\ that submitted a cPRIME Order that trades with cPRIME
AOC Responses and/or cPRIME participating quotes or orders, if the
cPRIME Order experiences a break-up of greater than 60%, which is not
changing under this proposal.\24\
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\21\ See Exchange Rule 510(c).
\22\ See Section 1)a)vi) MIAX Complex Price Improvement
Mechanism (``cPRIME'') Fees, of the Exchange's Fee Schedule.
\23\ The term ``Electronic Exchange Member'' or ``EEM'' means
the holder of a Trading Permit who is not a Market Maker. Electronic
Exchange Members are deemed ``members'' under the Exchange Act. See
Exchange Rule 100.
\24\ See the Exchange's Fee schedule, footnote ``*'' of Section
1)a)vi), on its public website (available at https://www.miaxoptions.com/fees).
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[[Page 9558]]
2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with section 6(b) of the Act \25\ in general, and
furthers the objectives of section 6(b)(4) of the Act \26\ in
particular, in that it is an equitable allocation of reasonable dues,
fees, and other charges among its members and issuers and other persons
using its facilities. The Exchange also believes the proposal furthers
the objectives of section 6(b)(5) of the Act \27\ in that it is
designed to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and
a national market system, and, in general, to protect investors and the
public interest and is not designed to permit unfair discrimination
between customers, issuers, brokers and dealers.
---------------------------------------------------------------------------
\25\ 15 U.S.C. 78f(b).
\26\ 15 U.S.C. 78f(b)(4).
\27\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange believes its proposal provides for the equitable
allocation of reasonable dues and fees and is not unfairly
discriminatory for the following reasons. The Exchange operates in a
highly competitive market in which market participants can readily
direct order flow to competing venues if they deem fee levels at a
particular venue to be excessive or incentives to be insufficient. More
specifically, the Exchange is one of 16 registered options exchanges
competing for order flow. Based on publicly-available information, and
excluding index-based options, no single exchange has more than
approximately 12-13% of the market share of executed volume of
multiply-listed equity and exchange-traded fund (``ETF'') options
trades as of January 26, 2023, for the month of January 2023.\28\
Therefore, no exchange possesses significant pricing power in the
execution of multiply-listed equity and ETF options order flow. More
specifically, as of January 26, 2023, the Exchange has a total market
share of 6.45% of all equity options volume, for the month of January
2023.\29\
---------------------------------------------------------------------------
\28\ See ``The market at a glance/MTD AVERAGE'', available at
https://www.miaxoptions.com/ (data as of 1/1/2023-1/25/2023).
\29\ See id.
---------------------------------------------------------------------------
The Exchange believes that the ever-shifting market share among the
exchanges from month to month demonstrates that market participants can
shift order flow, or discontinue use of certain categories of products,
in response to fee changes. For example, on March 1, 2019, the Exchange
filed with the Commission an immediately effective filing to decrease
certain credits assessable to Members pursuant to the PCRP.\30\ The
Exchange experienced a decrease in total market share between the
months of February and March of 2019. Accordingly, the Exchange
believes that the March 1, 2019, fee change may have contributed to the
decrease in the Exchange's market share and, as such, the Exchange
believes competitive forces constrain options exchange transaction and
non-transaction fees.
---------------------------------------------------------------------------
\30\ See Securities Exchange Act Release No. 85301 (March 13,
2019), 84 FR 10166 (March 19, 2019) (SR-MIAX-2019-09).
---------------------------------------------------------------------------
Accordingly, competitive forces constrain the Exchange's
transaction fees, and market participants can readily trade on
competing venues if they deem pricing levels at those other venues to
be more favorable. In response to the competitive environment, the
Exchange offers specific rates and credits in its fees schedule, like
those of other options exchanges' fees schedules, which the Exchange
believes provides incentives to Members to increase order flow of
certain qualifying orders.
The Exchange believes that the PCRP itself is reasonably designed
because it incentivizes providers of Priority Customer order flow to
send that Priority Customer order flow to the Exchange in order to
receive a credit in a manner that enables the Exchange to improve its
overall competitiveness and strengthen its market quality for all
market participants. The PCRP, which provides increased incentives in
certain tiers in high volume select symbols, is also reasonably
designed to increase the competitiveness of the Exchange with other
options exchanges that also offer increased incentives (e.g., lower
fees or higher rebates) to higher volume symbols.\31\
---------------------------------------------------------------------------
\31\ See Nasdaq ISE Fee Schedule, Options 7, Section 3. Regular
Order Fees and Rebates, Select Symbols.
---------------------------------------------------------------------------
The Exchange believes that its proposal to amend the rebate
provided for Priority Customer Orders in MIAX Select Symbols in Tier 3
is consistent with section 6(b)(4) of the Act \32\ in that the proposal
is reasonable, equitable and not unfairly discriminatory as it applies
uniformly to all similarly situated participants. The Exchange believes
the proposed change (a $0.02 decrease from the current rebate) is
reasonable in that it represents a modest decrease from the current
rebate provide in Tier 3. The Exchange believes that the proposed
rebate will continue to provide an incentive to participants to submit
Priority Customer Orders in MIAX Select Symbols. The Exchange believes
that even with the proposed reduced credit in Tier 3, the Exchange's
credits for the PCRP remain in line with, or higher than, competing
exchanges' credits for similar programs.\33\ The Exchange also believes
that its proposal is consistent with section 6(b)(5) of the Act because
it will apply equally to all Priority Customer Orders in Tier 3. All
similarly situated participants are subject to the same rebate
schedule, and access to the Exchange is offered on terms that are not
unfairly discriminatory.
---------------------------------------------------------------------------
\32\ 15 U.S.C. 78f(b)(4).
\33\ See NYSE American Options Fee Schedule, Section I.E.,
American Customer Engagement (``ACE'') Program (providing a simple
credit of $0.17 in Tier 3); see also Cboe Exchange, Inc. Options Fee
Schedule, Page 3, Volume Incentive Program (``VIP'') (providing a
simple Non-AIM rebate of $0.12 in Tier 3).
---------------------------------------------------------------------------
The Exchange believes that its proposal to provide a per contract
credit for all cPRIME Agency Orders based upon the order break-up
percentage will continue to encourage Priority Customer order flow to
auctions. Increased Priority Customer order flow benefits all market
participants because it continues to attract liquidity to the Exchange
by providing more trading opportunities. This attracts Market Makers
and other liquidity providers, thus, facilitating price improvement in
the auction process, signaling additional corresponding order flow from
other market participants, and, as a result, increasing liquidity on
the Exchange.
The Exchange believes that its proposal is consistent with section
6(b)(4) of the Act \34\ in that the proposal is reasonable, equitable
and not unfairly discriminatory as it applies uniformly to all
similarly situated participants. The Exchange believes the PCRP is
reasonably designed because it will provide an incentive to providers
of Priority Customer order flow to send that Priority Customer order
follow to the Exchange to receive a credit in a manner that enables the
Exchange to improve its overall competiveness and strengthen its market
quality for all participants.
---------------------------------------------------------------------------
\34\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
The Exchange's proposal to provide a per contract credit to
eligible cPRIME Agency Orders based upon the order break-up percentage
is consistent with section 6(b)(4) of the Act \35\ because it applies
equally to all participants of the PCRP that submit cPRIME Agency
Orders. The Exchange believes that the proposed rebate structure is
fair, equitable, and not unreasonably discriminatory. The PCRP is
reasonably designed because it will provide an incentive to providers
of Priority Customer order flow to send that
[[Page 9559]]
Priority Customer order flow to the Exchange to receive a credit in a
manner that enables the Exchange to improve its overall competitiveness
and strengthen its market quality for all participants.
---------------------------------------------------------------------------
\35\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
In addition, the Exchange believes that its proposal is consistent
with section 6(b)(5) of the Act \36\ because it perfects the mechanisms
of a free and open market and a national market system and protects
investors and the public interest because an increase in Priority
Customer order flow will bring greater volume and liquidity to the
Exchange, which benefits all market participants by providing more
trading opportunities and tighter spreads. To the extent Priority
Customer order flow is increased by this proposal, market participants
will increasingly compete for the opportunity to trade on the Exchange
including sending more orders and provided narrower and larger-sized
quotations in the effort to trade with such Priority Customer Order
flow.
---------------------------------------------------------------------------
\36\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange believes that providing rebates for Priority Customers
that submit cPRIME Agency Orders is equitable and not unfairly
discriminatory because the proposed rebate schedule will apply equally
to all cPRIME Agency Orders for Priority Customers. The Exchange
believes that the application of the rebate is equitable and not
unfairly discriminatory because, as stated above, Customer order flow
enhances liquidity on the Exchange, in turn providing more trading
opportunities and attracting other market participants, thus,
facilitating tighter spreads, increased order flow and trading
opportunities to the benefit of all market participants. Moreover, the
options industry has a long history of providing preferential pricing
to Priority Customer Orders, and the Exchange's current fees schedule
currently does so in many places, as does the fee structure of at least
one other exchange.\37\
---------------------------------------------------------------------------
\37\ See Cboe Fee Schedule, ``Break-Up Credits,'' available at
https://cdn.cboe.com/resources/membership/Cboe_FeeSchedule.pdf.
---------------------------------------------------------------------------
As noted above, the Exchange operates in a highly competitive
market. The Exchange is only one of several options venues to which
market participants may direct their order flow, and it represents a
small percentage of the overall market. The Exchange believes that the
proposed fees are reasonable, equitable, and not unfairly
discriminatory in that competing options exchanges offer similar fees
and credits in connection with similar price improvement auctions.\38\
---------------------------------------------------------------------------
\38\ Id.
---------------------------------------------------------------------------
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 self-regulatory organization (``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.'' \39\
---------------------------------------------------------------------------
\39\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496 (June 29, 2005).
---------------------------------------------------------------------------
The Exchange believes that the ever-shifting market shares among
the exchanges from month to month demonstrates that market participants
can shift order flow or discontinue or reduce use of certain categories
of products, in response to transaction and non-transaction fee
changes. Accordingly, competitive forces constrain the Exchange's
transaction fees and rebates, and market participants can readily trade
on competing venues if they deem pricing levels at those other venues
to be more favorable. The Exchange believes the proposal reflects a
reasonable and competitive pricing structure which will continue to
incentivize market participants to direct Priority Customer Orders to
the Exchange, which the Exchange believes will enhance liquidity and
market quality on the exchange to the benefit of all Members.
For the reasons discussed above, the Exchange submits that the
proposal satisfies the requirements of sections 6(b)(4) and 6(b)(5) of
the Act \40\ in that it provides for the equitable allocation of
reasonable dues, fees and other charges among its Members and other
persons using its facilities and is not designed to unfairly
discriminate between customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------
\40\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
In accordance with section 6(b)(8) of the Act,\41\ the Exchange
does not believe that the proposed rule change will impose any burden
on intra-market or intra-market competition that is not necessary or
appropriate in furtherance of the purposes of the Act. Rather, as
discussed above, the Exchange believes that the proposed changes will
encourage the submission of additional liquidity to price improvement
auctions, thereby promoting market depth, price discovery,
transparency, and enhanced order execution and price improvement
opportunities for all Members. As a result, the Exchange believes that
the proposed change furthers the Commission's goal in adopting
Regulation NMS of fostering competition among orders, which promotes
``more efficient pricing of individual stocks for all types of orders,
large and small.'' \42\
---------------------------------------------------------------------------
\41\ 15 U.S.C. 78f(b)(8).
\42\ See Securities Exchange Act Release No. 51808, 70 FR 37495,
37498-99 (June 29, 2005) (S7-10-04) (Final Rule).
---------------------------------------------------------------------------
The Exchange does not believe that its proposal will impose any
burden on intra-market competition that is not necessary or appropriate
in furtherance of the purposes of the Act because the proposed changes
will apply uniformly to all eligible Priority Customers. The Exchange
believes that this proposal will continue to encourage Members to
submit cPRIME Agency Orders for Priority Customers, which will increase
liquidity and benefit all market participants by providing more trading
opportunities and tighter spreads. The Exchange notes the fact that
preferential pricing to Priority Customers is a long-standing options
industry practice. The proposed rebate changes serve to enhance
Priority Customer order flow to the Exchange's Price Improvement
Mechanism, which, as a result, facilitates increased liquidity and
execution opportunities to the benefit of all market participants.
Additionally, the Exchange does not believe its proposal to reduce
the Tier 3 rebate for MIAX Select Symbols will impose any burden on
intra-market competition that is not necessary or appropriate in
furtherance of the purposes of the Act because the proposed change will
apply uniformly to all similarly situated participants.
The Exchange also does not believe that its proposal will impose
any burden on inter-market competition that is not necessary or
appropriate in furtherance of the purposes of the Act because, as noted
above, at least one other competing options exchange \43\ has similar
rebates in place in connection with similar price improvement auctions.
Additionally, and as previously discussed, the Exchange operates in a
highly competitive market. Members have numerous alternative venues
that they participate on and direct their order flow to, including 15
other options exchanges, many of which offer substantially similar
price improvement auctions. Based on publicly available information, no
single options exchange has more than
[[Page 9560]]
approximately 12-13% of the equity options market share.\44\ Therefore,
no exchange possesses significant pricing power in the execution of
option order flow. Participants can readily choose to send their orders
to other exchanges if they deem fee levels at those other exchanges to
be more favorable. Moreover, the Commission has repeatedly expressed
its preference for competition over regulatory intervention in
determining prices, products, and services in the securities markets.
Specifically, 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.'' \45\ The fact that this market is competitive has also
long been recognized by the courts. In NetCoalition v. Securities and
Exchange Commission, the D.C. Circuit states as follows: ``[n]o one
disputes that competition for order flow is `fierce.' . . . As the SEC
explained, `[i]n the U.S. national market system, buyers and sellers of
securities, and the broker-dealers that act as their order-routing
agents, have a wide range of choices of where to route orders for
execution'; [and] `no exchange can afford to take its market share
percentages for granted' because `no exchange possesses a monopoly,
regulatory or otherwise, in the execution of order flow from broker
dealers' . . .'' \46\ Accordingly, the Exchange does not believe its
proposed fee change imposes any burden on competition that is not
necessary or appropriate in furtherance of the purposes of the Act.
---------------------------------------------------------------------------
\43\ See supra note 37.
\44\ See supra note 28.
\45\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005).
\46\ NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010)
(quoting Securities Exchange Act Release No. 59039 (December 2,
2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSEArca-2006-
21)).
---------------------------------------------------------------------------
Accordingly, the Exchange believes that the proposed changes will
not impose any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act because it will
continue to encourage order flow, which provides greater volume and
liquidity, benefiting all market participants by providing more trading
opportunities and tighter spreads.
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,\47\ and Rule 19b-4(f)(2) \48\ 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.
---------------------------------------------------------------------------
\47\ 15 U.S.C. 78s(b)(3)(A)(ii).
\48\ 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 Number SR-MIAX-2023-03 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-MIAX-2023-03. 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-MIAX-2023-03 and should be submitted on
or before March 7, 2023.
---------------------------------------------------------------------------
\49\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\49\
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-03055 Filed 2-13-23; 8:45 am]
BILLING CODE 8011-01-P
