Self-Regulatory Organizations; Miami International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Fee Schedule for Purge Ports, 71913-71917 [2023-22927]

Download as PDF Federal Register / Vol. 88, No. 200 / Wednesday, October 18, 2023 / Notices appropriate in furtherance of the purposes of the Act. In this regard and as indicated above, the Exchange notes that the proposal is substantially similar in all material respects to filings submitted by Cboe EDGX Exchange, Inc. (‘‘EDGX’’), Cboe BZX Exchange, Inc. (‘‘BZX’’), and BOX Options Market LLC (‘‘BOX’’).12 This proposal does not create an unnecessary or inappropriate inter-market burden on competition because it merely amends the Fee Schedule to modify the timing and notice requirements relating to the modification of the ORF and conforms to the timing and notice requirements used by other options exchanges within their fee schedules.13 Further, ORF is a regulatory fee that supports regulation in furtherance of the purposes of the Act. The Exchange is obligated to ensure that the amount of regulatory revenue collected from the ORF, in combination with its other regulatory fees and fines, does not exceed regulatory costs and the proposed rule change does not seek to change that. 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 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 if consistent with the protection of investors and the public interest, it has become effective pursuant to section 19(b)(3)(A) of the Act 14 and Rule 19b–4(f)(6) 15 thereunder. A proposed rule change filed under Rule 19b–4(f)(6) 16 normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b–4(f)(6)(iii),17 the 12 Id. 13 Id. ddrumheller on DSK120RN23PROD with NOTICES1 14 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, along with a brief description and text of 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. 16 17 CFR 240.19b–4(f)(6). 17 17 CFR 240.19b–4(f)(6)(iii). 15 17 VerDate Sep<11>2014 18:01 Oct 17, 2023 Jkt 262001 71913 Commission may 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 upon filing. The Exchange is requesting the waiver because it will allow the Exchange to exercise more flexibility with respect to timing of changes to its assessment of ORF based on its periodic monitoring of ORF rates and allow the Exchange to mirror similar provisions already in place on other exchanges. Finally, the Exchange states that the proposed change would not introduce any novel regulatory issues. For these reasons, and because the proposed rule change does not raise any novel legal or regulatory issues, the Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest. Therefore, the Commission hereby waives the 30-day operative delay and designates the proposal operative upon filing.18 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. All submissions should refer to file number SR–MIAX–2023–40. 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 Reference Room, 100 F Street NE, Washington, DC 20549, on official business days between the hours of 10 a.m. and 3 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or subject to copyright protection. All submissions should refer to file number SR–MIAX–2023–40 and should be submitted on or before November 8, 2023. 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: For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 Sherry R. Haywood, Assistant Secretary. 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–2023–40 on the subject line. SECURITIES AND EXCHANGE COMMISSION Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549–1090. [FR Doc. 2023–22922 Filed 10–17–23; 8:45 am] BILLING CODE 8011–01–P [Release No. 34–98732; File No. SR–MIAX– 2023–37] Self-Regulatory Organizations; Miami International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Fee Schedule for Purge Ports October 12, 2023. 18 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). PO 00000 Frm 00097 Fmt 4703 Sfmt 4703 Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 19 17 E:\FR\FM\18OCN1.SGM CFR 200.30–3(a)(12) and (a)(59). 18OCN1 71914 Federal Register / Vol. 88, No. 200 / Wednesday, October 18, 2023 / Notices (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on September 29, 2023, Miami International Securities Exchange, LLC (‘‘MIAX’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the 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 proposes to amend the MIAX Options Exchange Fee Schedule (the ‘‘Fee Schedule’’) to amend fees for Purge Ports.3 The text of the proposed rule change is available on the Exchange’s website at https://www.miaxglobal.com/markets/ us-options/miax-options/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. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change ddrumheller on DSK120RN23PROD with NOTICES1 1. Purpose The Exchange is proposing to amend the fees for Purge Ports, which is a function enabling Market Makers 4 to cancel all open quotes or a subset of open quotes through a single cancel message. The Exchange currently provides Market Makers the option to purchase Purge Ports to assist in their 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 The proposed fee change is based on a recent proposal by Nasdaq Phlx LLC (‘‘Phlx’’) to adopt fees for purge ports. See Securities Exchange Act Release No. 97825 (June 30, 2023), 88 FR 43405 (July 7, 2023) (SR–Phlx–2023–28). 4 The term ‘‘Market Makers’’ refers to Lead Market Makers (‘‘LMMs’’), Primary Lead Market Makers (‘‘PLMMs’’), and Registered Market Makers (‘‘RMMs’’) collectively. See Exchange Rule 100. 2 17 VerDate Sep<11>2014 18:01 Oct 17, 2023 Jkt 262001 quoting activity. Purge Ports provide Market Makers with the ability to send purge messages to the Exchange System.5 Purge Ports are not capable of sending or receiving any other type of messages or information. The use of Purge Ports is completely optional and no rule or regulation requires that a Market Maker utilize them. Unlike other options exchanges that charge fees for Purge Ports on a per port basis,6 the Exchange assesses a flat fee of $1,500 per month, regardless of the number of Purge Ports. Today, a Market Maker may request and be allocated two (2) Purge Ports per Matching Engine to which it connects and not all Market Makers connect to all Matching Engines. The Exchange now proposes to amend the fee for Purge Ports to align more with other exchanges who charge on a per port basis by providing two (2) Purge Ports per Matching Engine for a monthly flat fee of $300 per month per Matching Engine. The only difference with a per port structure being is that Market Makers receive two (2) Purge Ports per Matching Engine for the same proposed monthly fee, rather than be charged separate fee for each Purge Port. The Exchange proposes to charge the proposed fee for Purge Ports per Matching Engine, instead on a per Purge Port basis, due to its system architecture which provides two (2) Purge Ports per Matching Engine for redundancy purposes. In addition, the proposed fee would be lower than what other exchanges charge on a per port basis, notwithstanding that the Exchange is providing up to two (2) Purge Ports for that same low fee.7 Similar to a per port charge, Market Makers would be also able to elect the number of Matching Engines they connect to and pay the applicable fee. The Exchange believes the proposed fee provides Market Makers with flexibility to control their Purge Ports costs based on the number of Matching Engines it elects to connect to. * * * * * 5 The term ‘‘System’’ means the automated trading system used by the Exchange for the trading of securities. See Exchange Rule 100. 6 See Cboe BXZ Exchange, Inc. (‘‘BZX’’) Options Fee Schedule, Options Logical Port Fees, Purge Ports ($750 per purge port per month); Cboe EDGX Exchange, Inc. (‘‘EDGX’’) Options Fee Schedule, Options Logical Port Fees, Purge Ports ($750 per purge port per month); Cboe Exchange, Inc. (‘‘Cboe’’) Fee Schedule ($850 per purge port per month). See also Nasdaq GEMX, Options 7, Pricing Schedule, Section 6.C.(3). Nasdaq GEMX, LLC (‘‘Nasdaq GEMX’’) assesses its members $1,250 per SQF Purge Port per month, subject to a monthly cap of $17,500 for SQF Purge Ports and SQF Ports, applicable to market makers. See also Securities Exchange Act Release No. 97825 (June 30, 2023), 88 FR 43405 (July 7, 2023) (SR–Phlx–2023–28). 7 Id. PO 00000 Frm 00098 Fmt 4703 Sfmt 4703 A logical port represents a port established by the Exchange within the Exchange’s system for trading and billing purposes. Each logical port grants a Member the ability to accomplish a specific function, such as order entry, order cancellation, access to execution reports, and other administrative information. Purge Ports are designed to assist Market Makers 8 in the management of, and risk control over, their quotes, particularly if the firm is dealing with a large number of securities. For example, if a Market Maker detects market indications that may influence the execution potential of their quotes, the Market Maker may use Purge Ports to reduce uncertainty and to manage risk by purging all quotes in a number of securities. This allows Market Makers to seamlessly avoid unintended executions, while continuing to evaluate the market, their positions, and their risk levels. Purge Ports are used by Market Makers that conduct business activity that exposes them to a large amount of risk across a number of securities. Purge Ports enable Market Makers to cancel all open quotes, or a subset of open quotes through a single cancel message. The Exchange notes that Purge Ports increase efficiency of already existing functionality enabling the cancellation of quotes. The Exchange operates highly performant systems with significant throughput and determinism which allows participants to enter, update and cancel quotes at high rates. Market Makers may currently cancel individual quotes through the existing functionality, such as through the use of a mass cancel message by which a Market Maker may request that the Exchange remove all or a subset of its quotations and block all or a subset of its new inbound quotations.9As a result, Market Makers can currently cancel quotes in rapid succession across their existing logical ports 10 or through a single cancel message, all open quotes or a subset of open quotes. Similarly, Market Makers may also use cancel-on-disconnect control when they experience a disruption in connection to the Exchange to automatically cancel all quotes, as configured or instructed by the Member 8 Members seeking to become registered as a Market Maker must comply with the applicable requirements of Chapter VI of the Exchange’s Rules. 9 See Exchange Rule 519C(a) and (b). 10 Current Exchange port functionality supports cancelation rates that exceed one thousand messages per second and the Exchange’s research indicates that certain market participants rely on such functionality and at times utilize such cancelation rates. E:\FR\FM\18OCN1.SGM 18OCN1 Federal Register / Vol. 88, No. 200 / Wednesday, October 18, 2023 / Notices or Market Maker.11 In addition, the Exchange already provides similar ability to mass cancel quotes through the Exchange’s risk controls, which are offered at no charge that enables Market Makers to establish pre-determined levels of risk exposure, and can be used to cancel all open quotes.12 Accordingly, the Exchange believes that the Purge Ports provide an efficient option as an alternative to already available services and enhance the Participant’s ability to manage their risk. The Exchange believes that market participants benefit from a dedicated purge mechanism for specific Market Makers and to the market as a whole. Market Makers will have the benefit of efficient risk management and purge tools. The market will benefit from potential increased quoting and liquidity as Market Makers may use Purge Ports to manage their risk more robustly. Only Market Makers that request Purge Ports would be subject to the proposed fees, and other Market Makers can continue to operate in exactly the same manner as they do today without dedicated Purge Ports, but with the additional purging capabilities described above. Implementation Date The proposed fees will be effective October 1, 2023. ddrumheller on DSK120RN23PROD with NOTICES1 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with section 6(b) of the Act,13 in general, and furthers the objectives of section 6(b)(5) of the Act,14 in particular, in that it is not designed to permit unfair discrimination among customers, brokers, or dealers. The Exchange also believes that its proposed fee is consistent with section 6(b)(4) of the Act 15 because it represents an equitable allocation of reasonable dues, fees and other charges among market participants. The Exchange believes that the proposed rule change would promote just and equitable principles of trade and remove impediments to and perfect the mechanism of a free and open market because offering Market Makers optional service and flexible fee structures promotes choice, flexibility, efficiency, and competition. The Exchange believes Purge Ports enhance Market Makers’ ability to manage quotes, which would, in turn, improve 11 See Exchange Rule 516C(c). Exchange Rule 532. 13 15 U.S.C. 78f(b). 14 15 U.S.C. 78f(b)(5). 15 15 U.S.C. 78f(b)(4). 12 See VerDate Sep<11>2014 18:01 Oct 17, 2023 Jkt 262001 their risk controls to the benefit of all market participants. The Exchange believes that Purge Ports foster cooperation and coordination with persons engaged in facilitating transactions in securities because designating Purge Ports for purge messages may encourage better use of such ports. This may, concurrent with the ports that carry quotes and other information necessary for market making activities, enable more efficient, as well as fair and reasonable, use of Market Makers’ resources. Similar connectivity and functionality is offered by options exchanges, including the Exchange’s own affiliated options exchanges, and other equities exchanges.16 The Exchange believes that proper risk management, including the ability to efficiently cancel multiple quotes quickly when necessary, is similarly valuable to firms that trade in the equities market, including Market Makers that have heightened quoting obligations that are not applicable to other market participants. Purge Ports do not relieve Market Makers of their quoting obligations or firm quote obligations under Regulation NMS Rule 602.17 Specifically, any interest that is executable against a Member’s or Market Maker’s quotes that is received by the Exchange prior to the time of the removal of quotes request will automatically execute. Market Makers that purge their quotes will not be relieved of the obligation to provide continuous two- sided quotes on a daily basis, nor will it prohibit the Exchange from taking disciplinary action against a Market Maker for failing to meet their continuous quoting obligation each trading day.18 The Exchange is not the only exchange to offer this functionality and to charge associated fees.19 The Exchange believes the proposed fee for Purge Ports is reasonable because it is lower than that currently charged by other exchanges. For example, BZX and EDGX charge a fee of $750 per purge port per month, Cboe charges $850 per purge port per month, Nasdaq GEMX assesses its members $1,250 per SQF Purge Port per month, subject to a 16 See supra notes 3 and 6. See also Securities Exchange Act Release No. 77613 (April 13, 2016), 81 FR 23023 (April 19, 2016). See also Securities Exchange Act Release Nos. 79956 (February 3, 2017), 82 FR 10102 (February 9, 2017) (SR– BatsBZX–2017–05); 79957 (February 3, 2017), 82 FR 10070 (February 9, 2017) (SR–BatsEDGX–2017–07); 83201 (May 9, 2018), 83 FR 22546 (May 15, 2018) (SR–C2–2018–006). 17 See Exchange Rule 604. See also generally Chapter VI of the Exchange’s Rules. 18 Id. 19 See supra notes 3 and 6. PO 00000 Frm 00099 Fmt 4703 Sfmt 4703 71915 monthly cap of $17,500 for SQF Purge Ports and SQF Ports.20 The Exchange believes it is reasonable to charge $300 per month for Purge Ports as such ports represent targeted enhancement of technology and were specially developed to allow for the sending of a single message to cancel multiple quotes, thereby assisting firms in effectively managing risk. The Exchange also believes that a Member that chooses to utilize Purge Ports may, in the future, reduce their need for additional ports by consolidating cancel messages to the Purge Port and thus freeing up some capacity of the existing logical ports and, therefore, allowing for increased message traffic without paying for additional logical ports. Purge Ports provide the ability to cancel multiple quotes across multiple ports with less messaging from the firms using the ports and therefore may create efficiencies for firms and provide a more economical solution to their risk management needs. In addition, Purge Port requests may cancel quotes submitted over numerous ports and contain added functionality to purge only a subset of these quotes. Effective risk management is important both for individual market participants that choose to utilize risk features provided by the Exchange, as well as for the market in general. As a result, the Exchange believes that it is appropriate to charge fees for such functionality as doing so aids in the maintenance of a fair and orderly market. The Exchange also believes that its ability to set fees for Purge Ports is subject to significant substitution-based forces because Market Makers are able to rely on currently available services both free and those they receive when using existing trading protocols. If the value of the efficiency introduced through the Purge Port functionality is not worth the proposed fees, Market Makers will simply continue to rely on the existing functionality and not pay for Purge Ports. In that regard, Market Makers may currently cancel individual quotes through the existing functionality, such as through the use of a mass cancel message by which a Market Maker may request that the Exchange remove all or a subset of its quotations and block all or a subset of its new inbound quotations. Market Makers already can also cancel quotes individually and by utilizing Exchange protocols that allow them to develop proprietary systems that can send cancel 20 See E:\FR\FM\18OCN1.SGM supra note 6. 18OCN1 ddrumheller on DSK120RN23PROD with NOTICES1 71916 Federal Register / Vol. 88, No. 200 / Wednesday, October 18, 2023 / Notices messages at a high rate.21 In addition, the Exchange already provides similar ability to mass cancel quotes through the Exchange’s risk controls, which are offered at no charge that enables Market Makers to establish pre-determined levels of risk exposure, and can be used to cancel all open quotes.22 Similarly, Market Makers may use cancel-on-disconnect control when they experience a disruption in connection to the Exchange to immediately cancel all pending Exchange.23 Finally, this existing purging functionality will allow Participants to achieve essentially the same outcome in canceling quotes as they would by utilizing the Purge Ports. Accordingly, the Exchange believes that the proposed Purge Ports fee is reasonable because it is related to the efficiency of Purge Ports related to other means and services already available which are either free or already a part of a fee assessed to the Participant’s for existing connectivity. Accordingly, because Purge Ports provide additional optional functionality, excessive fees would simply serve to reduce or eliminate demand for this optional product. The Exchange also believes that offering Purge Ports at the Matching Engine level promotes risk management across the industry, and thereby facilitates investor protection. Some market participants, in particular the larger firms, could and do build similar risk functionality (as described above) in their trading systems that permit the flexible cancellation of quotes entered on the Exchange at a high rate. Offering Matching Engine level protections ensures that such functionality is widely available to all firms, including smaller firms that may otherwise not be willing to incur the costs and development work necessary to support their own customized mass cancel functionality. As noted above, the Exchange is not the only exchange to offer dedicated Purge Ports, and the proposed rate is lower than that charged by other exchanges for similar functionality. The Exchange also believes that moving to a per Matching Engine fee is reasonable due to the Exchange’s architecture that provides it the ability to provide two (2) Purge Ports per Matching Engine for a fee that would still be lower than other exchanges that charge on a per port 21 Current Exchange port functionality supports cancelation rates that exceed one thousand messages per second and the Exchange’s research indicates that certain Participants rely on such functionality and at times utilize such cancelation rates. 22 See Exchange Rule 532. 23 See Exchange Rule 516C(c). VerDate Sep<11>2014 18:01 Oct 17, 2023 Jkt 262001 basis. Generally speaking, restricting the Exchange’s ability to charge fees for these services discourages innovation and competition. Specifically in this case, the Exchange’s inability to offer similar services to those offered by other exchanges, and charge reasonable and equitable fees for such services, would put the Exchange at a significant competitive disadvantage and, therefore, serve to restrict competition in the market—especially when other exchanges assess comparable fees higher than those proposed by the Exchange. The Exchange believes that the proposed Purge Port fees are equitable because the proposed Purge Ports are completely voluntary as they relate solely to optional risk management functionality. The Exchange also believes that the proposed amendments to its fee schedule are not unfairly discriminatory because they will apply uniformly to all Market Makers that choose to use the optional Purge Ports. Purge Ports are completely voluntary and, as they relate solely to optional risk management functionality, no Market Maker is required or under any regulatory obligation to utilize them. All Market Makers that voluntarily select this service option will be charged the same amount for the same services. All Market Makers have the option to select any connectivity option, and there is no differentiation among Market Makers with regard to the fees charged for the services offered by the Exchange. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. Purge Ports are completely voluntary and are available to all Market Makers on an equal basis at the same cost. While the Exchange believes that Purge Ports provide a valuable service, Market Makers can choose to purchase, or not purchase, these ports based on their own determination of the value and their business needs. No Market Makers is required or under any regulatory obligation to utilize Purge Ports. Accordingly, the Exchange believes that Purge Ports offer appropriate risk management functionality to firms that trade on the Exchange without imposing an unnecessary or inappropriate burden on competition. Furthermore, the Exchange operates in a highly competitive environment, and its ability to price the Purge Ports is constrained by competition among exchanges that offer similar PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 functionality. As discussed, there are currently a number of similar offers available to market participants for higher fees at other exchanges. Proposing fees that are excessively higher than established fees for similar functionality would simply serve to reduce demand for the Purge Ports, which as discussed, market participants are under no obligation to utilize. It could also cause firms to shift trading to other exchanges that offer similar functionality at a lower costs, adversely impacting the overall trading on the Exchange and reducing market share. In this competitive environment, potential purchasers are free to choose which, if any, similar product to purchase to satisfy their need for risk management. As a result, the Exchange believes this proposed rule change permits fair competition among national securities exchanges. The Exchange also does not believe the proposal would cause any unnecessary or in appropriate burden on intermarket competition as other exchanges are free to introduce their own purge port functionality and lower their prices to better compete with the Exchange’s offering. The Exchange does not believe the proposed rule change would cause any unnecessary or inappropriate burden on intramarket competition. Particularly, the proposal would apply uniformly to any market participant, in that it does not differentiate between Market Makers. The proposal would allow any interested Market Makers to purchase Purge Port functionality based on their business needs. 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,24 and Rule 19b–4(f)(2) 25 thereunder. At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend the 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 24 15 25 17 E:\FR\FM\18OCN1.SGM U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). 18OCN1 Federal Register / Vol. 88, No. 200 / Wednesday, October 18, 2023 / Notices takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. IV. Solicitation of Comments [FR Doc. 2023–22927 Filed 10–17–23; 8:45 am] 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–2023–37 on the subject line. ddrumheller on DSK120RN23PROD with NOTICES1 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–2023–37. 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 a.m. and 3 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or subject to copyright protection. All submissions should refer to file number SR–MIAX–2023–37 and should be submitted on or before November 8, 2023. VerDate Sep<11>2014 18:01 Oct 17, 2023 Jkt 262001 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.26 Sherry R. Haywood, Assistant Secretary. BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [SEC File No. 270–418, OMB Control No. 3235–0485] Proposed Collection; Comment Request; Extension: Rule 15c2–1 Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 20549–2736 Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 (‘‘PRA’’) (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (‘‘Commission’’) is soliciting comments on the existing collection of information provided for in Rule 15c2–1, (17 CFR 240.15c2–1), under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.). The Commission plans to submit this existing collection of information to the Office of Management and Budget (‘‘OMB’’) for extension and approval. Rule 15c2–1 prohibits broker-dealers from commingling under the same lien securities of their margin customers with securities of the broker-dealer and those of other customers without their written consent. The rule also prohibits the re-hypothecation of customers’ margin securities for a sum in excess of the customer’s aggregate indebtedness. Respondents must collect information necessary to prevent the rehypothecation of customer securities, issue and retain copies of notices of hypothecation of customer securities, and collect written consents from customers. There are approximately 59 respondents. Each of these respondents makes an estimated 45 responses per year and each response takes approximately 0.5 hours to complete, resulting in an industry-wide annual burden of approximately 1,327 hours. Written comments are invited on: (a) whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; (b) the accuracy of the Commission’s estimates of the burden of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted by December 18, 2023. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information under the PRA unless it displays a currently valid OMB control number. Please direct your written comments to: David Bottom, Director/Chief Information Officer, Securities and Exchange Commission, c/o John Pezzullo, 100 F Street NE, Washington, DC 20549, or send an email to: PRA_ Mailbox@sec.gov. Dated: October 12, 2023. Sherry R. Haywood, Assistant Secretary. [FR Doc. 2023–22921 Filed 10–17–23; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–98729; File No. SR– PEARL–2023–56] Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fee Schedule Related to the Options Regulatory Fee October 12, 2023. Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on October 5, 2023, MIAX PEARL, LLC (‘‘MIAX Pearl’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. 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 fee schedule (the ‘‘Fee Schedule’’) related to the Options Regulatory Fee. The text of the proposed rule change is available on the Exchange’s website at 1 15 26 17 PO 00000 CFR 200.30–3(a)(12). Frm 00101 Fmt 4703 Sfmt 4703 71917 2 17 E:\FR\FM\18OCN1.SGM U.S.C. 78s(b)(1). CFR 240.19b–4. 18OCN1

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SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 88, Number 200 (Wednesday, October 18, 2023)]
[Notices]
[Pages 71913-71917]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-22927]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-98732; File No. SR-MIAX-2023-37]


Self-Regulatory Organizations; Miami International Securities 
Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Amend Fee Schedule for Purge Ports

October 12, 2023.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934

[[Page 71914]]

(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on September 29, 2023, Miami International Securities Exchange, LLC 
(``MIAX'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') the 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the MIAX Options Exchange Fee 
Schedule (the ``Fee Schedule'') to amend fees for Purge Ports.\3\
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    \3\ The proposed fee change is based on a recent proposal by 
Nasdaq Phlx LLC (``Phlx'') to adopt fees for purge ports. See 
Securities Exchange Act Release No. 97825 (June 30, 2023), 88 FR 
43405 (July 7, 2023) (SR-Phlx-2023-28).
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    The text of the proposed rule change is available on the Exchange's 
website at https://www.miaxglobal.com/markets/us-options/miax-options/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.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange is proposing to amend the fees for Purge Ports, which 
is a function enabling Market Makers \4\ to cancel all open quotes or a 
subset of open quotes through a single cancel message. The Exchange 
currently provides Market Makers the option to purchase Purge Ports to 
assist in their quoting activity. Purge Ports provide Market Makers 
with the ability to send purge messages to the Exchange System.\5\ 
Purge Ports are not capable of sending or receiving any other type of 
messages or information. The use of Purge Ports is completely optional 
and no rule or regulation requires that a Market Maker utilize them.
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    \4\ The term ``Market Makers'' refers to Lead Market Makers 
(``LMMs''), Primary Lead Market Makers (``PLMMs''), and Registered 
Market Makers (``RMMs'') collectively. See Exchange Rule 100.
    \5\ The term ``System'' means the automated trading system used 
by the Exchange for the trading of securities. See Exchange Rule 
100.
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    Unlike other options exchanges that charge fees for Purge Ports on 
a per port basis,\6\ the Exchange assesses a flat fee of $1,500 per 
month, regardless of the number of Purge Ports. Today, a Market Maker 
may request and be allocated two (2) Purge Ports per Matching Engine to 
which it connects and not all Market Makers connect to all Matching 
Engines. The Exchange now proposes to amend the fee for Purge Ports to 
align more with other exchanges who charge on a per port basis by 
providing two (2) Purge Ports per Matching Engine for a monthly flat 
fee of $300 per month per Matching Engine. The only difference with a 
per port structure being is that Market Makers receive two (2) Purge 
Ports per Matching Engine for the same proposed monthly fee, rather 
than be charged separate fee for each Purge Port. The Exchange proposes 
to charge the proposed fee for Purge Ports per Matching Engine, instead 
on a per Purge Port basis, due to its system architecture which 
provides two (2) Purge Ports per Matching Engine for redundancy 
purposes. In addition, the proposed fee would be lower than what other 
exchanges charge on a per port basis, notwithstanding that the Exchange 
is providing up to two (2) Purge Ports for that same low fee.\7\
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    \6\ See Cboe BXZ Exchange, Inc. (``BZX'') Options Fee Schedule, 
Options Logical Port Fees, Purge Ports ($750 per purge port per 
month); Cboe EDGX Exchange, Inc. (``EDGX'') Options Fee Schedule, 
Options Logical Port Fees, Purge Ports ($750 per purge port per 
month); Cboe Exchange, Inc. (``Cboe'') Fee Schedule ($850 per purge 
port per month). See also Nasdaq GEMX, Options 7, Pricing Schedule, 
Section 6.C.(3). Nasdaq GEMX, LLC (``Nasdaq GEMX'') assesses its 
members $1,250 per SQF Purge Port per month, subject to a monthly 
cap of $17,500 for SQF Purge Ports and SQF Ports, applicable to 
market makers. See also Securities Exchange Act Release No. 97825 
(June 30, 2023), 88 FR 43405 (July 7, 2023) (SR-Phlx-2023-28).
    \7\ Id.
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    Similar to a per port charge, Market Makers would be also able to 
elect the number of Matching Engines they connect to and pay the 
applicable fee. The Exchange believes the proposed fee provides Market 
Makers with flexibility to control their Purge Ports costs based on the 
number of Matching Engines it elects to connect to.
* * * * *
    A logical port represents a port established by the Exchange within 
the Exchange's system for trading and billing purposes. Each logical 
port grants a Member the ability to accomplish a specific function, 
such as order entry, order cancellation, access to execution reports, 
and other administrative information.
    Purge Ports are designed to assist Market Makers \8\ in the 
management of, and risk control over, their quotes, particularly if the 
firm is dealing with a large number of securities. For example, if a 
Market Maker detects market indications that may influence the 
execution potential of their quotes, the Market Maker may use Purge 
Ports to reduce uncertainty and to manage risk by purging all quotes in 
a number of securities. This allows Market Makers to seamlessly avoid 
unintended executions, while continuing to evaluate the market, their 
positions, and their risk levels. Purge Ports are used by Market Makers 
that conduct business activity that exposes them to a large amount of 
risk across a number of securities. Purge Ports enable Market Makers to 
cancel all open quotes, or a subset of open quotes through a single 
cancel message. The Exchange notes that Purge Ports increase efficiency 
of already existing functionality enabling the cancellation of quotes.
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    \8\ Members seeking to become registered as a Market Maker must 
comply with the applicable requirements of Chapter VI of the 
Exchange's Rules.
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    The Exchange operates highly performant systems with significant 
throughput and determinism which allows participants to enter, update 
and cancel quotes at high rates. Market Makers may currently cancel 
individual quotes through the existing functionality, such as through 
the use of a mass cancel message by which a Market Maker may request 
that the Exchange remove all or a subset of its quotations and block 
all or a subset of its new inbound quotations.\9\As a result, Market 
Makers can currently cancel quotes in rapid succession across their 
existing logical ports \10\ or through a single cancel message, all 
open quotes or a subset of open quotes.
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    \9\ See Exchange Rule 519C(a) and (b).
    \10\ Current Exchange port functionality supports cancelation 
rates that exceed one thousand messages per second and the 
Exchange's research indicates that certain market participants rely 
on such functionality and at times utilize such cancelation rates.
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    Similarly, Market Makers may also use cancel-on-disconnect control 
when they experience a disruption in connection to the Exchange to 
automatically cancel all quotes, as configured or instructed by the 
Member

[[Page 71915]]

or Market Maker.\11\ In addition, the Exchange already provides similar 
ability to mass cancel quotes through the Exchange's risk controls, 
which are offered at no charge that enables Market Makers to establish 
pre-determined levels of risk exposure, and can be used to cancel all 
open quotes.\12\ Accordingly, the Exchange believes that the Purge 
Ports provide an efficient option as an alternative to already 
available services and enhance the Participant's ability to manage 
their risk.
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    \11\ See Exchange Rule 516C(c).
    \12\ See Exchange Rule 532.
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    The Exchange believes that market participants benefit from a 
dedicated purge mechanism for specific Market Makers and to the market 
as a whole. Market Makers will have the benefit of efficient risk 
management and purge tools. The market will benefit from potential 
increased quoting and liquidity as Market Makers may use Purge Ports to 
manage their risk more robustly. Only Market Makers that request Purge 
Ports would be subject to the proposed fees, and other Market Makers 
can continue to operate in exactly the same manner as they do today 
without dedicated Purge Ports, but with the additional purging 
capabilities described above.
Implementation Date
    The proposed fees will be effective October 1, 2023.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with section 6(b) of the Act,\13\ in general, and furthers the 
objectives of section 6(b)(5) of the Act,\14\ in particular, in that it 
is not designed to permit unfair discrimination among customers, 
brokers, or dealers. The Exchange also believes that its proposed fee 
is consistent with section 6(b)(4) of the Act \15\ because it 
represents an equitable allocation of reasonable dues, fees and other 
charges among market participants.
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    \13\ 15 U.S.C. 78f(b).
    \14\ 15 U.S.C. 78f(b)(5).
    \15\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that the proposed rule change would promote 
just and equitable principles of trade and remove impediments to and 
perfect the mechanism of a free and open market because offering Market 
Makers optional service and flexible fee structures promotes choice, 
flexibility, efficiency, and competition. The Exchange believes Purge 
Ports enhance Market Makers' ability to manage quotes, which would, in 
turn, improve their risk controls to the benefit of all market 
participants. The Exchange believes that Purge Ports foster cooperation 
and coordination with persons engaged in facilitating transactions in 
securities because designating Purge Ports for purge messages may 
encourage better use of such ports. This may, concurrent with the ports 
that carry quotes and other information necessary for market making 
activities, enable more efficient, as well as fair and reasonable, use 
of Market Makers' resources. Similar connectivity and functionality is 
offered by options exchanges, including the Exchange's own affiliated 
options exchanges, and other equities exchanges.\16\ The Exchange 
believes that proper risk management, including the ability to 
efficiently cancel multiple quotes quickly when necessary, is similarly 
valuable to firms that trade in the equities market, including Market 
Makers that have heightened quoting obligations that are not applicable 
to other market participants.
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    \16\ See supra notes 3 and 6. See also Securities Exchange Act 
Release No. 77613 (April 13, 2016), 81 FR 23023 (April 19, 2016). 
See also Securities Exchange Act Release Nos. 79956 (February 3, 
2017), 82 FR 10102 (February 9, 2017) (SR-BatsBZX-2017-05); 79957 
(February 3, 2017), 82 FR 10070 (February 9, 2017) (SR-BatsEDGX-
2017-07); 83201 (May 9, 2018), 83 FR 22546 (May 15, 2018) (SR-C2-
2018-006).
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    Purge Ports do not relieve Market Makers of their quoting 
obligations or firm quote obligations under Regulation NMS Rule 
602.\17\ Specifically, any interest that is executable against a 
Member's or Market Maker's quotes that is received by the Exchange 
prior to the time of the removal of quotes request will automatically 
execute. Market Makers that purge their quotes will not be relieved of 
the obligation to provide continuous two- sided quotes on a daily 
basis, nor will it prohibit the Exchange from taking disciplinary 
action against a Market Maker for failing to meet their continuous 
quoting obligation each trading day.\18\
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    \17\ See Exchange Rule 604. See also generally Chapter VI of the 
Exchange's Rules.
    \18\ Id.
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    The Exchange is not the only exchange to offer this functionality 
and to charge associated fees.\19\ The Exchange believes the proposed 
fee for Purge Ports is reasonable because it is lower than that 
currently charged by other exchanges. For example, BZX and EDGX charge 
a fee of $750 per purge port per month, Cboe charges $850 per purge 
port per month, Nasdaq GEMX assesses its members $1,250 per SQF Purge 
Port per month, subject to a monthly cap of $17,500 for SQF Purge Ports 
and SQF Ports.\20\
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    \19\ See supra notes 3 and 6.
    \20\ See supra note 6.
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    The Exchange believes it is reasonable to charge $300 per month for 
Purge Ports as such ports represent targeted enhancement of technology 
and were specially developed to allow for the sending of a single 
message to cancel multiple quotes, thereby assisting firms in 
effectively managing risk. The Exchange also believes that a Member 
that chooses to utilize Purge Ports may, in the future, reduce their 
need for additional ports by consolidating cancel messages to the Purge 
Port and thus freeing up some capacity of the existing logical ports 
and, therefore, allowing for increased message traffic without paying 
for additional logical ports. Purge Ports provide the ability to cancel 
multiple quotes across multiple ports with less messaging from the 
firms using the ports and therefore may create efficiencies for firms 
and provide a more economical solution to their risk management needs. 
In addition, Purge Port requests may cancel quotes submitted over 
numerous ports and contain added functionality to purge only a subset 
of these quotes. Effective risk management is important both for 
individual market participants that choose to utilize risk features 
provided by the Exchange, as well as for the market in general. As a 
result, the Exchange believes that it is appropriate to charge fees for 
such functionality as doing so aids in the maintenance of a fair and 
orderly market.
    The Exchange also believes that its ability to set fees for Purge 
Ports is subject to significant substitution-based forces because 
Market Makers are able to rely on currently available services both 
free and those they receive when using existing trading protocols. If 
the value of the efficiency introduced through the Purge Port 
functionality is not worth the proposed fees, Market Makers will simply 
continue to rely on the existing functionality and not pay for Purge 
Ports. In that regard, Market Makers may currently cancel individual 
quotes through the existing functionality, such as through the use of a 
mass cancel message by which a Market Maker may request that the 
Exchange remove all or a subset of its quotations and block all or a 
subset of its new inbound quotations. Market Makers already can also 
cancel quotes individually and by utilizing Exchange protocols that 
allow them to develop proprietary systems that can send cancel

[[Page 71916]]

messages at a high rate.\21\ In addition, the Exchange already provides 
similar ability to mass cancel quotes through the Exchange's risk 
controls, which are offered at no charge that enables Market Makers to 
establish pre-determined levels of risk exposure, and can be used to 
cancel all open quotes.\22\
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    \21\ Current Exchange port functionality supports cancelation 
rates that exceed one thousand messages per second and the 
Exchange's research indicates that certain Participants rely on such 
functionality and at times utilize such cancelation rates.
    \22\ See Exchange Rule 532.
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    Similarly, Market Makers may use cancel-on-disconnect control when 
they experience a disruption in connection to the Exchange to 
immediately cancel all pending Exchange.\23\ Finally, this existing 
purging functionality will allow Participants to achieve essentially 
the same outcome in canceling quotes as they would by utilizing the 
Purge Ports. Accordingly, the Exchange believes that the proposed Purge 
Ports fee is reasonable because it is related to the efficiency of 
Purge Ports related to other means and services already available which 
are either free or already a part of a fee assessed to the 
Participant's for existing connectivity. Accordingly, because Purge 
Ports provide additional optional functionality, excessive fees would 
simply serve to reduce or eliminate demand for this optional product.
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    \23\ See Exchange Rule 516C(c).
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    The Exchange also believes that offering Purge Ports at the 
Matching Engine level promotes risk management across the industry, and 
thereby facilitates investor protection. Some market participants, in 
particular the larger firms, could and do build similar risk 
functionality (as described above) in their trading systems that permit 
the flexible cancellation of quotes entered on the Exchange at a high 
rate. Offering Matching Engine level protections ensures that such 
functionality is widely available to all firms, including smaller firms 
that may otherwise not be willing to incur the costs and development 
work necessary to support their own customized mass cancel 
functionality.
    As noted above, the Exchange is not the only exchange to offer 
dedicated Purge Ports, and the proposed rate is lower than that charged 
by other exchanges for similar functionality. The Exchange also 
believes that moving to a per Matching Engine fee is reasonable due to 
the Exchange's architecture that provides it the ability to provide two 
(2) Purge Ports per Matching Engine for a fee that would still be lower 
than other exchanges that charge on a per port basis. Generally 
speaking, restricting the Exchange's ability to charge fees for these 
services discourages innovation and competition. Specifically in this 
case, the Exchange's inability to offer similar services to those 
offered by other exchanges, and charge reasonable and equitable fees 
for such services, would put the Exchange at a significant competitive 
disadvantage and, therefore, serve to restrict competition in the 
market--especially when other exchanges assess comparable fees higher 
than those proposed by the Exchange.
    The Exchange believes that the proposed Purge Port fees are 
equitable because the proposed Purge Ports are completely voluntary as 
they relate solely to optional risk management functionality.
    The Exchange also believes that the proposed amendments to its fee 
schedule are not unfairly discriminatory because they will apply 
uniformly to all Market Makers that choose to use the optional Purge 
Ports. Purge Ports are completely voluntary and, as they relate solely 
to optional risk management functionality, no Market Maker is required 
or under any regulatory obligation to utilize them. All Market Makers 
that voluntarily select this service option will be charged the same 
amount for the same services. All Market Makers have the option to 
select any connectivity option, and there is no differentiation among 
Market Makers with regard to the fees charged for the services offered 
by the Exchange.

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. Purge Ports are completely 
voluntary and are available to all Market Makers on an equal basis at 
the same cost. While the Exchange believes that Purge Ports provide a 
valuable service, Market Makers can choose to purchase, or not 
purchase, these ports based on their own determination of the value and 
their business needs. No Market Makers is required or under any 
regulatory obligation to utilize Purge Ports. Accordingly, the Exchange 
believes that Purge Ports offer appropriate risk management 
functionality to firms that trade on the Exchange without imposing an 
unnecessary or inappropriate burden on competition.
    Furthermore, the Exchange operates in a highly competitive 
environment, and its ability to price the Purge Ports is constrained by 
competition among exchanges that offer similar functionality. As 
discussed, there are currently a number of similar offers available to 
market participants for higher fees at other exchanges. Proposing fees 
that are excessively higher than established fees for similar 
functionality would simply serve to reduce demand for the Purge Ports, 
which as discussed, market participants are under no obligation to 
utilize. It could also cause firms to shift trading to other exchanges 
that offer similar functionality at a lower costs, adversely impacting 
the overall trading on the Exchange and reducing market share. In this 
competitive environment, potential purchasers are free to choose which, 
if any, similar product to purchase to satisfy their need for risk 
management. As a result, the Exchange believes this proposed rule 
change permits fair competition among national securities exchanges.
    The Exchange also does not believe the proposal would cause any 
unnecessary or in appropriate burden on intermarket competition as 
other exchanges are free to introduce their own purge port 
functionality and lower their prices to better compete with the 
Exchange's offering. The Exchange does not believe the proposed rule 
change would cause any unnecessary or inappropriate burden on 
intramarket competition. Particularly, the proposal would apply 
uniformly to any market participant, in that it does not differentiate 
between Market Makers. The proposal would allow any interested Market 
Makers to purchase Purge Port functionality based on their business 
needs.

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,\24\ and Rule 19b-4(f)(2) \25\ thereunder. 
At any time within 60 days of the filing of such proposed rule change, 
the Commission summarily may temporarily suspend the 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

[[Page 71917]]

takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.
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    \24\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \25\ 17 CFR 240.19b-4(f)(2).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-MIAX-2023-37 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-2023-37. 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 
a.m. and 3 p.m. Copies of the filing also will be available for 
inspection and copying at the principal office of the Exchange. Do not 
include personal identifiable information in submissions; you should 
submit only information that you wish to make available publicly. We 
may redact in part or withhold entirely from publication submitted 
material that is obscene or subject to copyright protection. All 
submissions should refer to file number SR-MIAX-2023-37 and should be 
submitted on or before November 8, 2023.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\26\
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    \26\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-22927 Filed 10-17-23; 8:45 am]
BILLING CODE 8011-01-P

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