Self-Regulatory Organizations; MIAX Emerald, LLC; Notice of Filing of Proposed Minor Rule Violation Plan, 95833-95834 [2024-28255]

Download as PDF Federal Register / Vol. 89, No. 232 / Tuesday, December 3, 2024 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–101759; File No. 4–845] Self-Regulatory Organizations; MIAX Emerald, LLC; Notice of Filing of Proposed Minor Rule Violation Plan November 26, 2024. Pursuant to Section 19(d)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19d–1(c)(2) thereunder,2 notice is hereby given that on November 19, 2024, MIAX Emerald, LLC (‘‘Emerald’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) a proposed minor rule violation plan (‘‘MRVP’’) with sanctions not exceeding $2,500 which would not be subject to the provisions of Rule 19d–1(c)(1) of the Act 3 requiring that a self-regulatory organization (‘‘SRO’’) promptly file notice with the Commission of any final disciplinary action taken with respect to any person or organization.4 In accordance with Rule 19d–1(c)(2) under the Act,5 the Exchange proposes to designate certain specified rule violations as minor rule violations, and requests that it be relieved of the prompt reporting requirements regarding such violations, provided it gives notice of such violations to the Commission on a quarterly basis. The Exchange proposes to include in its MRVP the procedures and violations currently included in Exchange Rule 1014 (‘‘Imposition of Fines for Minor Rule Violations’’).6 According to the Exchange’s proposed MRVP, under Rule 1014, the Exchange may impose a fine (not to exceed $2,500) on any Member, or person associated with or employed 1 15 U.S.C. 78s(d)(1). CFR 240.19d–1(c)(2). 3 17 CFR 240.19d–1(c)(1). 4 The Commission adopted amendments to paragraph (c) of Rule 19d–1 to allow SROs to submit for Commission approval plans for the abbreviated reporting of minor disciplinary infractions. See Securities Exchange Act Release No. 21013 (June 1, 1984), 49 FR 23828 (June 8, 1984). Any disciplinary action taken by an SRO against any person for violation of a rule of the SRO which has been designated as a minor rule violation pursuant to such a plan filed with and declared effective by the Commission shall not be considered ‘‘final’’ for purposes of Section 19(d)(1) of the Act if the sanction imposed consists of a fine not exceeding $2,500 and the sanctioned person has not sought an adjudication, including a hearing, or otherwise exhausted his administrative remedies. 5 17 CFR 240.19d–1(c)(2). 6 The Exchange received its grant of registration on December 20, 2018, which included approving the rules that govern the Exchange. The Exchange notes that certain chapters of the Exchange’s rules are incorporated by reference from the rules of the Exchange’s affiliate Miami International Securities Exchange, LLC (MIAX Options). Specifically, Chapter X, DISCIPLINE, which contains Rule 1014, Imposition of Fines for Minor Rule Violations. lotter on DSK11XQN23PROD with NOTICES1 2 17 VerDate Sep<11>2014 17:09 Dec 02, 2024 Jkt 265001 by a Member, for any rule violation listed in Rule 1014(d).7 The Exchange shall serve the person against whom a fine is imposed with a written statement setting forth the rule or rules allegedly violated, the act or omission constituting each such violation, the fine imposed for each violation, and the date by which such determination becomes final or by which such determination must be paid or contested. If the person against whom the fine is imposed pays the fine, such payment shall be deemed to be a waiver of such person’s right to a disciplinary proceeding and any review of the matter under the Exchange rules. Any person against whom a fine is imposed may contest the Exchange’s determination by filing with the Exchange a written answer, at which point the matter shall become a disciplinary proceeding. The Exchange proposes that, as set forth in Exchange Rule 1014(d), violations of the following rules would be appropriate for disposition under the MRVP: Rule 307 (Position Limits); Rule 803 (Focus Reports); Rule 804 (Requests for Trade Data); Rule 520 (Order Entry); Rule 603 (Quotation Parameters); Rule 605 (Execution of Orders in Appointed Options); Rule 314 (Mandatory Systems Testing); Rule 700 (Exercise of Option Contracts); Rule 309 (Exercise Limits); Rule 310 (Reports Related to Position Limits); Rule 403 (Trading in Restricted Classes); Rule 604 (Market Maker Quotations); Rule 1904 (Failure to Timely File Amendments to Form U4, Form U5, and Form BD); and Rules 1701–1713 (Failure to Comply with the Consolidated Audit Trail Compliance Rule Under Chapter XVII). The Exchange states that it is specifically excluding Rule 1014(d)(4), Conduct and Decorum Policies, from this filing. Upon the Commission’s declaration of effectiveness of the MRVP, the Exchange will provide to the Commission a quarterly report for any actions taken on minor rule violations under the MRVP. The quarterly report will include: the disposition date, the name of the firm/ individual, the Exchange’s internal enforcement number, the review period, the nature of the violation type, the number of the rule that was violated, the number of instances the violation occurred, and the sanction imposed. Based on compliance with the above, the Exchange requests that the rule violations designated in Rule 1014(d) be designated as minor rule violations 7 While Rule 1014 allows the Exchange to administer fines up to $5,000, the Exchange is only seeking relief from the reporting requirements of paragraph (c)(1) of Rule 19d–1 for fines administered under Rule 1014(d) that do not exceed $2,500. PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 95833 subject to a minor rule violation reporting plan and that the Exchange be relieved of the current reporting requirements regarding such violations. In addition, going forward, to the extent that there are any changes to the rules applicable to the Exchange’s MRVP, the Exchange requests that the Commission deem such changes to be modifications to the Exchange’s MRVP. I. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed MRVP 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 No. 4–845 on the subject line. Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549–1090. All submissions should refer to File No. 4–845. 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 MRVP that are filed with the Commission, and all written communications relating to the proposed MRVP 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 proposed MRVP 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 E:\FR\FM\03DEN1.SGM 03DEN1 95834 Federal Register / Vol. 89, No. 232 / Tuesday, December 3, 2024 / Notices to File No. 4–845 and should be submitted on or before December 24, 2024. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change II. Date of Effectiveness of Proposed Minor Rule Violation Plan and Timing for Commission Action The Exchange proposes to amend proposes to amend Rules 3120 (Position Limits), 5020 (Criteria for Underlying Securities), and 5055 (FLEX Equity Options). The text of the proposed rule change is available from the principal office of the Exchange, at the Commission’s Public Reference Room and also on the Exchange’s internet website at https://rules. boxexchange.com/rulefilings. Pursuant to Section 19(d)(1) of the Act and Rule 19d–1(c)(2) thereunder,8 after December 24, 2024, the Commission may, by order, declare the Exchange’s proposed MRVP effective if the plan is consistent with the public interest, the protection of investors, or otherwise in furtherance of the purposes of the Act. The Commission in its order may restrict the categories of violations to be designated as minor rule violations and may impose any other terms or conditions to the proposed MRVP, File No. 4–845, and to the period of its effectiveness, which the Commission deems necessary or appropriate in the public interest, for the protection of investors or otherwise in furtherance of the purposes of the Act. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.9 Sherry R. Haywood, Assistant Secretary. [FR Doc. 2024–28255 Filed 12–2–24; 8:45 am] BILLING CODE 8011–01–P [Release No. 34–101773; File No. SR–BOX– 2024–29] Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rules 3120 (Position Limits) and 5020 (Criteria for Underlying Securities) To Permit Options Trading on Bitcoin Funds lotter on DSK11XQN23PROD with NOTICES1 November 27, 2024. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’),1 and Rule 19b–4thereunder,2 notice is hereby given that on November 25, 2024, BOX Exchange LLC (‘‘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. U.S.C. 78s(d)(1); 17 CFR 240.19d–1(c)(2). CFR 200.30–3(a)(44). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 9 17 VerDate Sep<11>2014 17:09 Dec 02, 2024 Jkt 265001 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 SECURITIES AND EXCHANGE COMMISSION 8 15 II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Rules 3120 (Position Limits) and 5020 (Criteria for Underlying Securities) to permit options trading on the Fidelity Wise Origin Bitcoin Fund (the ‘‘Fidelity Fund’’) and the ARK 21Shares Bitcoin ETF (the ‘‘ARK 21 Fund’’ and, with the Fidelity Fund, the ‘‘Bitcoin Funds’’).3 Additionally, the Exchange proposes to amend Rule 5055 (FLEX Equity Options). Specifically, the Exchange proposes to amend Rule 5020(h) to allow the Exchange to list and trade options on the Bitcoin Funds.4 This is a competitive filing that is based on a proposal recently submitted by Cboe 3 See Securities Exchange Act Release No. 99306 (January 10, 2024), 89 FR 3008, 3009 (January 17, 2024) (SR–NYSEArca-2021–90; SR–NYSEArca– 2023–44; SR–NYSEArca–2023–58; SR- NASDAQ– 2023–016; SR–NASDAQ–2023–019; SR–CboeBZX– 2023–028; SR–CboeBZX–2023–038; SR–CboeBZX– 2023–040; SR–CboeBZX–2023–042; SRCboeBZX– 2023–044; and SR–CboeBZX–2023–072) (Order Granting Accelerated Approval of Proposed Rule Changes, as Modified by Amendments Thereto, to List and Trade Bitcoin-Based Commodity-Based Trust Shares and Trust Units) (‘‘Bitcoin ETP Approval Order’’). 4 See proposed Rule 5020(h). PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 Exchange, Inc. (‘‘CBOE’’) and approved by the Commission.5 As discussed herein and as provided in the CBOE Approval Order, the Exchange believes options on the Bitcoin Funds would permit hedging, and allow for more liquidity, better price efficiency, and less volatility with respect to the underlying Funds. Further, permitting the listing of such options would enhance the transparency and efficiency of markets in these and correlated products. Rule 5020(h) provides that, subject to certain other criteria set forth in the Rule, securities deemed appropriate for options trading include ExchangeTraded Fund Shares (or ETFs), that represent certain types of interests 6 and exchange-traded products (‘‘ETPs’’) 5 See Securities Exchange Act Release No. 101387 (October 18, 2024), 89 FR 84948 (October 24, 2024) (Notice of Filing of Amendment Nos. 2 and 3 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment Nos. 2 and 3, to Permit the Listing and Trading of Options on Bitcoin Exchange-Traded Funds) (SR–CBOE– 2024–035, as amended) (‘‘CBOE Approval Order’’). 6 See Rule 5020(h), which permits options trading on ETFs that are traded on a national securities exchange and are defined as an ‘‘NMS stock’’ in Rule 600 of Regulation NMS and that (i) represent interests in registered investment companies (or series thereof) organized as open-end management investment companies, unit investment trusts or similar entities that hold portfolios of securities and/or financial instruments, including, but not limited to, stock index futures contracts, options on futures, options on securities and indices, equity caps, collars and floors, swap agreements, forward contracts, repurchase agreements and reverse repurchase agreements (the ‘‘Financial Instruments’’) and money market instruments, including, but not limited to, U.S. government securities and repurchase agreements (the ‘‘Money Market Instruments’’) comprising or otherwise based on or representing investments in broadbased indexes or portfolios of securities and/or Financial Instruments and Money Market Instruments (or that hold securities in one or more other registered investment companies that themselves hold such portfolios of securities and/ or Financial Instruments and Money Market Instruments); or (ii) represent interests in a trust that holds a specified non-U.S. currency deposited with the trust or similar entity when aggregated in some specified minimum number may be surrendered to the trust by the beneficial owner to receive the specified non-U.S. currency or currencies and pays the beneficial owner interest and other distributions on the deposited non-U.S. currency or currencies, if any, declared and paid by the trust (‘‘Currency Trust Shares’’); or (iii) represent commodity pool interests principally engaged, directly or indirectly, in holding and/or managing portfolios or baskets of securities, commodity futures contracts, options on commodity futures contracts, swaps, forward contracts and/or options on physical commodities and/or non-U.S. currency (‘‘Commodity Pool ETFs’’) or (iv) represent interests in the SPDR® Gold Trust, the iShares COMEX Gold Trust, the iShares Silver Trust, the abrdn Gold ETF Trust, the abrdn Silver ETF Trust, the abrdn Palladium ETF Trust, the abrdn Platinum ETF Trust, the Sprott Physical Gold Trust, the iShares Bitcoin Trust, the Grayscale Bitcoin Trust, the Grayscale Bitcoin Mini Trust or the Bitwise Bitcoin ETF; provided that all of the conditions in Rules 5020(h)(1) and (2) are met. E:\FR\FM\03DEN1.SGM 03DEN1

Agencies

[Federal Register Volume 89, Number 232 (Tuesday, December 3, 2024)]
[Notices]
[Pages 95833-95834]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-28255]



[[Page 95833]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-101759; File No. 4-845]


Self-Regulatory Organizations; MIAX Emerald, LLC; Notice of 
Filing of Proposed Minor Rule Violation Plan

November 26, 2024.
    Pursuant to Section 19(d)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19d-1(c)(2) thereunder,\2\ notice is hereby 
given that on November 19, 2024, MIAX Emerald, LLC (``Emerald'' or the 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') a proposed minor rule violation plan (``MRVP'') with 
sanctions not exceeding $2,500 which would not be subject to the 
provisions of Rule 19d-1(c)(1) of the Act \3\ requiring that a self-
regulatory organization (``SRO'') promptly file notice with the 
Commission of any final disciplinary action taken with respect to any 
person or organization.\4\ In accordance with Rule 19d-1(c)(2) under 
the Act,\5\ the Exchange proposes to designate certain specified rule 
violations as minor rule violations, and requests that it be relieved 
of the prompt reporting requirements regarding such violations, 
provided it gives notice of such violations to the Commission on a 
quarterly basis.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(d)(1).
    \2\ 17 CFR 240.19d-1(c)(2).
    \3\ 17 CFR 240.19d-1(c)(1).
    \4\ The Commission adopted amendments to paragraph (c) of Rule 
19d-1 to allow SROs to submit for Commission approval plans for the 
abbreviated reporting of minor disciplinary infractions. See 
Securities Exchange Act Release No. 21013 (June 1, 1984), 49 FR 
23828 (June 8, 1984). Any disciplinary action taken by an SRO 
against any person for violation of a rule of the SRO which has been 
designated as a minor rule violation pursuant to such a plan filed 
with and declared effective by the Commission shall not be 
considered ``final'' for purposes of Section 19(d)(1) of the Act if 
the sanction imposed consists of a fine not exceeding $2,500 and the 
sanctioned person has not sought an adjudication, including a 
hearing, or otherwise exhausted his administrative remedies.
    \5\ 17 CFR 240.19d-1(c)(2).
---------------------------------------------------------------------------

    The Exchange proposes to include in its MRVP the procedures and 
violations currently included in Exchange Rule 1014 (``Imposition of 
Fines for Minor Rule Violations'').\6\ According to the Exchange's 
proposed MRVP, under Rule 1014, the Exchange may impose a fine (not to 
exceed $2,500) on any Member, or person associated with or employed by 
a Member, for any rule violation listed in Rule 1014(d).\7\ The 
Exchange shall serve the person against whom a fine is imposed with a 
written statement setting forth the rule or rules allegedly violated, 
the act or omission constituting each such violation, the fine imposed 
for each violation, and the date by which such determination becomes 
final or by which such determination must be paid or contested. If the 
person against whom the fine is imposed pays the fine, such payment 
shall be deemed to be a waiver of such person's right to a disciplinary 
proceeding and any review of the matter under the Exchange rules. Any 
person against whom a fine is imposed may contest the Exchange's 
determination by filing with the Exchange a written answer, at which 
point the matter shall become a disciplinary proceeding.
---------------------------------------------------------------------------

    \6\ The Exchange received its grant of registration on December 
20, 2018, which included approving the rules that govern the 
Exchange. The Exchange notes that certain chapters of the Exchange's 
rules are incorporated by reference from the rules of the Exchange's 
affiliate Miami International Securities Exchange, LLC (MIAX 
Options). Specifically, Chapter X, DISCIPLINE, which contains Rule 
1014, Imposition of Fines for Minor Rule Violations.
    \7\ While Rule 1014 allows the Exchange to administer fines up 
to $5,000, the Exchange is only seeking relief from the reporting 
requirements of paragraph (c)(1) of Rule 19d-1 for fines 
administered under Rule 1014(d) that do not exceed $2,500.
---------------------------------------------------------------------------

    The Exchange proposes that, as set forth in Exchange Rule 1014(d), 
violations of the following rules would be appropriate for disposition 
under the MRVP: Rule 307 (Position Limits); Rule 803 (Focus Reports); 
Rule 804 (Requests for Trade Data); Rule 520 (Order Entry); Rule 603 
(Quotation Parameters); Rule 605 (Execution of Orders in Appointed 
Options); Rule 314 (Mandatory Systems Testing); Rule 700 (Exercise of 
Option Contracts); Rule 309 (Exercise Limits); Rule 310 (Reports 
Related to Position Limits); Rule 403 (Trading in Restricted Classes); 
Rule 604 (Market Maker Quotations); Rule 1904 (Failure to Timely File 
Amendments to Form U4, Form U5, and Form BD); and Rules 1701-1713 
(Failure to Comply with the Consolidated Audit Trail Compliance Rule 
Under Chapter XVII). The Exchange states that it is specifically 
excluding Rule 1014(d)(4), Conduct and Decorum Policies, from this 
filing.
    Upon the Commission's declaration of effectiveness of the MRVP, the 
Exchange will provide to the Commission a quarterly report for any 
actions taken on minor rule violations under the MRVP. The quarterly 
report will include: the disposition date, the name of the firm/
individual, the Exchange's internal enforcement number, the review 
period, the nature of the violation type, the number of the rule that 
was violated, the number of instances the violation occurred, and the 
sanction imposed.
    Based on compliance with the above, the Exchange requests that the 
rule violations designated in Rule 1014(d) be designated as minor rule 
violations subject to a minor rule violation reporting plan and that 
the Exchange be relieved of the current reporting requirements 
regarding such violations. In addition, going forward, to the extent 
that there are any changes to the rules applicable to the Exchange's 
MRVP, the Exchange requests that the Commission deem such changes to be 
modifications to the Exchange's MRVP.

I. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed MRVP 
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 No. 4-
845 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File No. 4-845. 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 MRVP that are filed with the 
Commission, and all written communications relating to the proposed 
MRVP 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 proposed MRVP 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

[[Page 95834]]

to File No. 4-845 and should be submitted on or before December 24, 
2024.

II. Date of Effectiveness of Proposed Minor Rule Violation Plan and 
Timing for Commission Action

    Pursuant to Section 19(d)(1) of the Act and Rule 19d-1(c)(2) 
thereunder,\8\ after December 24, 2024, the Commission may, by order, 
declare the Exchange's proposed MRVP effective if the plan is 
consistent with the public interest, the protection of investors, or 
otherwise in furtherance of the purposes of the Act. The Commission in 
its order may restrict the categories of violations to be designated as 
minor rule violations and may impose any other terms or conditions to 
the proposed MRVP, File No. 4-845, and to the period of its 
effectiveness, which the Commission deems necessary or appropriate in 
the public interest, for the protection of investors or otherwise in 
furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(d)(1); 17 CFR 240.19d-1(c)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
---------------------------------------------------------------------------

    \9\ 17 CFR 200.30-3(a)(44).
---------------------------------------------------------------------------

Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-28255 Filed 12-2-24; 8:45 am]
BILLING CODE 8011-01-P
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