[Federal Register Volume 84, Number 249 (Monday, December 30, 2019)]
[Notices]
[Pages 72086-72088]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-28086]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-87823; File No. SR-EMERALD-2019-038]
Self-Regulatory Organizations: MIAX Emerald, LLC; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend
Exchange Rule 100, Definitions; Exchange Rule 503, Openings on the
Exchange; Exchange Rule 515, Execution of Orders and Quotes; Exchange
Rule 516, Order Types Defined; Exchange Rule 517, Quote Types Defined;
Exchange Rule 518, Complex Orders; and Exchange Rule 521, Nullification
and Adjustment of Options Transactions Including Obvious Errors
December 20, 2019.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on December 19, 2019, MIAX Emerald, LLC (``MIAX Emerald'' or
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the 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 is filing a proposal to amend Exchange Rule 100,
Definitions; Exchange Rule 503, Openings on the Exchange; Exchange Rule
515, Execution of Orders and Quotes; Exchange Rule 516, Order Types
Defined; Exchange Rule 517, Quote Types Defined; Exchange Rule 518,
Complex Orders; and Exchange Rule 521, Nullification and Adjustment of
Options Transactions Including Obvious Errors.
The text of the proposed rule change is available on the Exchange's
website at http://www.miaxoptions.com/rule-filings/emerald at MIAX
Emerald'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 proposes to amend Exchange Rule 100, Definitions;
Exchange Rule 503, Openings on the Exchange; Exchange Rule 515,
Execution of Orders and Quotes; Exchange Rule 516, Order Types Defined;
Exchange Rule 517, Quote Types Defined; Exchange Rule 518, Complex
Orders; and Exchange Rule 521, Nullification and Adjustment of Options
Transactions Including Obvious Errors, to make minor non-substantive
edits to update internal cross references in the Exchange's rulebook.
The Exchange is an affiliate of the Miami International Securities
Exchange, LLC (``MIAX'') and incorporates by reference a number of MIAX
Exchange rules into its rulebook. The MIAX Exchange recently amended
Rule 1400, Definitions, found in Chapter XIV of the MIAX Exchange
rules, which are its rules pertaining to the Options Order Protection
and Locked and Crossed Market Plan.\3\ The MIAX Exchange adopted a
definition for Complex Trade which, when inserted into its proper
alphabetical position in MIAX Exchange Rule 1400, caused the subsequent
following definitions to be renumbered (e.g., the existing subparagraph
(d) became new subparagraph (e); existing subparagraph (e) became new
subparagraph (f), etc . . .). As a result of the change to MIAX
Exchange Rule 1400, a number of non-substantive amendments must be made
to correct internal cross references within the Exchange's rulebook.
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\3\ See Securities Exchange Act Release No. 87693 (December 9,
2019), 84 FR 68264 (December 13, 2019) (SR-MIAX-2019-48).
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Specifically, the internal cross-reference to Eligible Exchanges in
the definition of ABBO or Away Best Bid or Offer, in Exchange Rule 100,
must be updated from Rule 1400(f) to Rule 1400(g). The internal cross-
reference to Eligible Exchanges in Exchange Rule 503(e)(1)(iii) must be
updated from Rule 1400(f) to Rule 1400(g). The internal cross-reference
to Intermarket Sweep Orders in Rule 503(f)(2)(iv)(A)2. must be updated
from Rule 1400(h) to Rule 1400(i). The internal cross-reference to the
NBBO in Exchange Rule 515(a) must be updated from Rule 1400(j) to Rule
1400(k). The internal cross-reference to Intermarket Sweep Orders in
Exchange Rule 516(f) must be updated from Rule 1400(h) to Rule 1400(i).
Similarly in Rule 516(f) the internal cross-references to Protected
Quotes and Eligible Exchanges must be updated from 1400(p) and (f) to
1400(q) and (g) respectively. Lastly, in Rule 516(f), the internal
cross-reference to Protected Bid or Protected Offer must be updated
from 1400(o) to 1400 (p). The internal cross-references to Protected
Bid and Protected Offer in Exchange Rule 517(a)(2)(v) must be updated
from 1400(o) to 1400(p). The internal cross-reference to Eligible
Exchanges in Exchange Rule 518(a)(1) must be updated from Rule 1400(f)
to Rule 1400(g). Finally, the internal cross-reference to the Options
Order Protection and Locked/Crossed Market Plan in Exchange Rule 521(j)
must be updated from Rule 1400(n) to Rule 1400(o).
The Exchange believes these changes add clarity and precision to
the Exchange's rules.
[[Page 72087]]
2. Statutory Basis
MIAX Emerald believes that its proposed rule change is consistent
with Section 6(b) of the Act \4\ in general, and furthers the
objectives of Section 6(b)(5) of the Act \5\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in, securities, to remove impediments to and
perfect the mechanisms of a free and open market and a national market
system and, in general, to protect investors and the public interest.
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\4\ 15 U.S.C. 78f(b).
\5\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that the proposed non-substantive rule
changes to update internal cross-references within the Exchange's Rules
promotes just and equitable principles of trade and removes impediments
to and perfects the mechanism of a free and open market and a national
market system and, in general, protects investors and the public
interest by providing additional clarity and precision in the
Exchange's rules. The Exchange believes it is in the public interest
for rules to be accurate and precise so as to eliminate the potential
for confusion.
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 that is not necessary or appropriate
in furtherance of the purposes of the Act.
The Exchange does not believe that the proposed rule change will
impose any burden on intermarket competition as the proposed change is
non-substantive in nature. The non-substantive edits to update internal
cross-references in the Exchange's rulebook provides precision and
accuracy in the Exchange's rules.
The Exchange does not believe that the proposed rule change will
impose any burden on intramarket competition as the non-substantive
edits to update internal cross-references in the Exchange's rulebook
provide additional detail and clarity in the Exchange's rules, which
apply equally to all Exchange Members.\6\
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\6\ The term ``Member'' means an individual or organization
approved to exercise the trading rights associate with a Trading
Permit. Members are deemed ``members'' under the Exchange Act. See
Exchange Rule 100.
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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
Because the 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 from the date on which it was filed, or such shorter time as the
Commission may designate, it has become effective pursuant to Section
19(b)(3)(A) of the Act \7\ and subparagraph (f)(6) of Rule 19b-4
thereunder.\8\
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\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4(f)(6). In addition, Rule19b-4(f)(6)(iii)
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.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \9\ normally does not become operative for 30 days after the date
of its filing. However, Rule 19b-4(f)(6)(iii) \10\ permits the
Commission to designate a shorter time if such action is consistent
with the protection of investors and the public interest. The Exchange
has requested that the Commission waive the 30-day operative delay so
that the proposed rule change may become operative upon filing. Waiver
of the operative delay would allow the Exchange to immediately
harmonize its rules to MIAX Options to ensure that the internal cross-
references in the Exchange's rulebook are correct. Therefore, the
Commission believes that waiver of the 30-day operative delay is
consistent with the protection of investors and the public interest.
Accordingly, the Commission hereby waives the operative delay and
designates the proposed rule change operative upon filing.\11\
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\9\ 17 CFR 240.19b-4(f)(6).
\10\ 17 CFR 240.19b-4(f)(6)(iii).
\11\ For purposes only of waiving the 30-day operative delay,
the Commission also has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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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 change 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 (http://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-EMERALD-2019-038 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-EMERALD-2019-038. 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 (http://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
[[Page 72088]]
to make available publicly. All submissions should refer to File Number
SR-EMERALD-2019-038 and should be submitted on or before January 21,
2020.
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\12\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2019-28086 Filed 12-27-19; 8:45 am]
BILLING CODE 8011-01-P