[Federal Register Volume 82, Number 225 (Friday, November 24, 2017)]
[Notices]
[Pages 55896-55898]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-25355]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82111; File No. SR-MIAX-2017-47]


 Self-Regulatory Organizations; Miami International Securities 
Exchange, LLC; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend MIAX Options Rule 612, Aggregate Risk 
Manager (``ARM'')

November 17, 2017.
    Pursuant to the provisions of Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice 
is hereby given that on November 14, 2017, Miami International 
Securities Exchange, LLC (``MIAX Options'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``Commission'') a proposed rule 
change as described in Items I, II, and III below, which Items have 
been prepared by the Exchange. The Commission is publishing this notice 
to solicit comments on the proposed rule change from interested 
persons.
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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 612, 
Aggregate Risk Manager (``ARM'').
    The text of the proposed rule change is available on the Exchange's 
Web site at http://www.miaxoptions.com/rule-filings, at MIAX's 
principal office, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

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 612, Aggregate Risk 
Manager (``ARM''), subsection (b)(1) Aggregate Risk Manager, and 
Interpretations and Policies .01, to make non-substantive technical 
changes to add additional detail to the rule text, all existing 
Exchange functionality discussed in this proposal will remain intact.
    Exchange Rule 612(b)(1) provides that the System \3\ will engage 
the Aggregate Risk Manager in a particular option class when the 
counting program has determined that a Market Maker \4\ has traded 
during the specified time period

[[Page 55897]]

a number of contracts equal to or above their Allowable Engagement 
Percentage.\5\ Further, the rule provides that the Aggregate Risk 
Manager will then automatically remove the Market Maker's quotations 
from the Exchange's disseminated quotation in all series of that 
particular option class until the Market Maker sends a notification to 
the System of the intent to reengage quoting and submits a new revised 
quotation.\6\
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    \3\ The term ``System'' means the automated trading system used 
by the Exchange for the trading of securities. See Exchange Rule 
100.
    \4\ The term ``Market Makers'' refers to ``Lead Market Makers'', 
``Primary Lead Market Makers'' and ``Registered Market Makers'' 
collectively. See Exchange Rule 100.
    \5\ See Exchange Rule 612(b)(2).
    \6\ See Exchange Rule 612(b)(1).
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    The Exchange proposes to amend the second sentence of the rule to 
provide that, ``[t]he Aggregate Risk Manager will then automatically 
remove the Market Maker's Standard quotations and Day eQuotes from the 
Exchange's disseminated quotation . . . .'' Exchange Rule 100 provides 
that, ``the term `quote' or `quotation' means a bid or offer entered by 
a Market Maker that is firm and may update the Market Maker's previous 
quote, if any. The Rules of the Exchange provide for the use of 
different types of quotes, including Standard quotes and eQuotes, as 
more fully described in Rule 517.'' \7\ The Exchange believes that 
adding additional detail to the current rule text to identify which 
specific types of quotes are being removed adds clarity and precision 
to the rule text.
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    \7\ See Exchange Rule 100.
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    The Exchange also proposes to amend Interpretations and Policies 
.01 to add additional detail and specificity to the rule text. 
Currently, the rule provides that, ``[t]he System does not include 
contracts traded through the use of an eQuote that is not a Day eQuote 
in the counting program for purposes of this Rule. eQuotes will remain 
in the System available for trading when the Aggregate Risk Manager is 
engaged.'' The Exchange proposes to amend the second sentence such that 
it reads, ``eQuotes, other than Day eQuotes, will remain in the System 
available for trading and may continue to be submitted to the Exchange 
when the Aggregate Risk Manager is engaged.'' The Exchange believes 
that this proposed change more clearly articulates that eQuotes both 
(i) remain in the System, and (ii) may continue to be submitted to the 
System to facilitate trading, while the Aggregate Risk Manager is 
engaged. The Exchange believes the proposed changes add additional 
detail and clarity in describing existing Exchange functionality.
2. Statutory Basis
    The Exchange believes that its proposed rule change is consistent 
with Section 6(b) of the Act \8\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act \9\ 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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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes the proposed changes promote just and 
equitable principles of trade, remove impediments to and perfect the 
mechanism of a free and open market and a national market system 
because they provide additional detail and clarity concerning how Day 
eQuotes and eQuotes are handled when the Aggregate Risk Manager is 
engaged. Clarifying that eQuotes remain in the System available for 
trading and may continue to be submitted to the Exchange while the 
Aggregate Risk Manager is engaged benefits Members and investors by 
providing increased transparency of Exchange functionality. The 
Exchange notes that the proposed changes are non-substantive and do not 
affect current Exchange functionality in any way.
    The Exchange believes the proposed changes promote just and 
equitable principles of trade, remove impediments to and perfect the 
mechanism of a free and open market and a national market system 
because they seek to improve the accuracy of the Exchange's rules. In 
particular, the Exchange believes that including additional detail 
describing existing Exchange functionality in the Exchange's rules will 
provide greater clarity to Members \10\ and the public regarding the 
Exchange's Rules, and it is in the public interest for rules to be 
accurate and concise so as to eliminate the potential for confusion.
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    \10\ The term ``Member'' means an individual or organization 
approved to exercise the trading rights associated with a Trading 
Permit. Members are deemed ``members'' under the Exchange Act. See 
Exchange Rule 100.
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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 proposed rule changes 
are not designed to address any competitive issues but rather are 
designed to add additional clarity and detail to the Exchange's rules.
    The Exchange does not believe that the proposed rule changes will 
impose any burden on inter-market competition as the Rules apply 
equally to all Exchange Members.

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, it has become effective 
pursuant to 19(b)(3)(A) of the Act \11\ and Rule 19b-4(f)(6) \12\ 
thereunder.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
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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 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

[[Page 55898]]

     Send an email to [email protected]. Please include 
File Number SR-MIAX-2017-47 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-2017-47. 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 Web site (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 Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change. Persons submitting 
comments are cautioned that we do not redact or edit personal 
identifying information from comment submissions. You should submit 
only information that you wish to make available publicly. All 
submissions should refer to File Number SR-MIAX-2017-47 and should be 
submitted on or before December 15, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-25355 Filed 11-22-17; 8:45 am]
 BILLING CODE 8011-01-P