[Federal Register Volume 83, Number 234 (Thursday, December 6, 2018)]
[Notices]
[Pages 62942-62943]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-26396]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84685; File No. SR-Phlx-2018-76]


Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the Pilot 
Period for the Listing of P.M.-Settled Nasdaq-100 Index Options 
Expiring on the Third Friday of the Month

November 29, 2018.
    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 November 20, 2018, Nasdaq PHLX LLC (``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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the pilot period for the listing of 
P.M.-settled Nasdaq-100 Index Options expiring on the third Friday of 
the month (``NDXPM options'').
    The text of the proposed rule change is available on the Exchange's 
website at http://nasdaqphlx.cchwallstreet.com/, at the principal 
office of the Exchange, 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
    In August 2017 the Commission approved a proposed rule change for 
the listing on the Exchange of NDXPM options on a pilot basis, with the 
pilot to terminate on the earlier to occur of (i) 12 months following 
the date of the first listing of the NDXPM options, or (ii) December 
29, 2018.\3\ Notwithstanding this approval, due to unforeseen technical 
programming delays P.M.-settled options on the NASDAQ-100 Index 
(``NASDAQ-100'') have not yet been listed by the Exchange. In order to 
allow sufficient time to realize the benefits of a pilot program for 
NDXPM options, the Exchange proposes to amend Rule 1101A, Commentary 
.05 such that he pilot will terminate on May 6, 2019. By extending the 
outer limit of the pilot period, the Exchange believes it will have 
adequate time to resolve the programming issues, implement the listing 
of NDXPM options, and provide the pilot reports associated with the 
initial approval order over a meaningful period of time. Without the 
amendment, the pilot period would end on December 29, 2018 and would 
not afford the Exchange or Commission a sufficient period of time 
within which NDXPM options may trade in order to be meaningfully 
evaluated by the Exchange as provided in the August 2017

[[Page 62943]]

approval order.\4\ The Exchange will make public on its website any 
data and analysis it submits to the Commission under the pilot program.
---------------------------------------------------------------------------

    \3\ See Rule 1101A Commentary .05 and Securities Exchange Act 
Release No. 81293 (August 2, 2017), 82 FR 37138 (August 8, 2017) 
(approving SR-Phlx-2017-04).
    \4\ The Exchange will issue an Options Trader Alert notifying 
Members when NDXPM options are listed.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\5\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\6\ in particular, in that it is designed to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general to protect investors and the public interest. 
The Exchange believes the proposed rule change will protect investors 
and the public interest by preserving the opportunity to list NDXPM 
options until May 6, 2019, providing the Exchange, the Commission and 
investors the benefit of a pilot program of sufficient duration to 
yield meaningful information concerning the impact of NDXPM options on 
the market.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

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. NDXPM options would be 
available for trading to all market participants. The proposed rule 
change will facilitate the listing and trading of a novel option 
product that will enhance competition among market participants, to the 
benefit of investors and the marketplace. The listing of NDXPM will 
enhance competition by providing investors with an additional 
investment vehicle, in a fully-electronic trading environment, through 
which investors can gain and hedge exposure to NASDAQ-100 stocks. 
Further, this product could offer a competitive alternative to other 
existing investment products that seek to allow investors to gain broad 
market exposure. Also, the Exchange notes that it is possible for other 
exchanges to develop or license the use of a new or different index to 
compete with the NASDAQ-100 and seek Commission approval to list and 
trade options on such an index.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or 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 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)(iii) of the Act \7\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\8\
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \8\ 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.
---------------------------------------------------------------------------

    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
     Send an email to [email protected]. Please include 
File Number SR-Phlx-2018-76 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-Phlx-2018-76. 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 to make available publicly. All submissions 
should refer to File Number SR-Phlx-2018-76 and should be submitted on 
or before December 26, 2018.

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

    \9\ 17 CFR 200.30-3(a)(12) and (59).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-26396 Filed 12-4-18; 8:45 am]
BILLING CODE 8011-01-P