[Federal Register Volume 84, Number 33 (Tuesday, February 19, 2019)]
[Notices]
[Pages 4880-4883]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-02605]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85108; File No. SR-CboeBZX-2019-002]


Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change Relating 
To Amend the Exchange's Eighth Amended and Restated Bylaws (the 
``Exchange Bylaws'') the Fourth Amended and Restated Bylaws (the 
``Parent Bylaws'') of Its Parent Corporation, Cboe Global Markets, Inc. 
(``Cboe'' or the ``Parent'')

February 12, 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 January 28, 2019, Cboe BZX Exchange, Inc. (the ``Exchange'' or 
``BZX'') 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 Exchange 
filed the proposal as a ``non-controversial''

[[Page 4881]]

proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 
\3\ and Rule 19b-4(f)(6) thereunder.\4\ 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Cboe BZX Exchange, Inc. (the ``Exchange'' or ``BZX'') proposes to 
amend the Exchange's Eighth Amended and Restated Bylaws (the ``Exchange 
Bylaws'') the Fourth Amended and Restated Bylaws (the ``Parent 
Bylaws'') of its parent corporation, Cboe Global Markets, Inc. 
(``Cboe'' or the ``Parent''). The text of the proposed amendments to 
the Exchange Bylaws is included in Exhibit 5A, and the text of the 
proposed amendments to the Parent Bylaws is included in Exhibit 5B.
    The text of the proposed rule change is also available on the 
Exchange's website (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, 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 proposed rule change amends the Exchange Bylaws to (1) amend 
the provision regarding which offices may be held by the same person 
and (2) amend the description of the duties of President of the 
Exchange. The proposed rule change also amends the Parent Bylaws to (1) 
amend the description of the duties of President of the Parent, (2) 
amend language relating to the definition of ``director independence,'' 
and (3) make a non-substantive update to the zip code for the 
registered office the Corporation.
Offices Held by Same Person
    Section 5.1(b) of the Exchange Bylaws currently provides that two 
or more offices may be held by the same person, except the offices of 
Chief Executive Officer and President.\5\ The Exchange proposes to 
amend Section 5.1(b) of the Exchange Bylaws to eliminate this 
restriction, and thus permit the same person to hold the offices of 
Chief Executive Officer and President. This proposal will provide the 
Exchange with the flexibility to appoint the person or persons it deems 
qualified and appropriate to perform the duties of both Chief Executive 
Officer and the President.
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    \5\ Section 5.1(b) also prohibits the Chief Executive Officer 
and President from also being the Secretary or Assistant Secretary, 
which prohibition the proposal does not substantively amend.
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Description of President
    Section 5.3 of the Parent Bylaws and Section 5.3 of the Exchange 
Bylaws each provide that the President of the Parent or Exchange, as 
applicable, shall be the chief operating officer of the Parent or 
Exchange, as applicable. The Exchange proposes to amend Section 5.3 of 
each of the Parent Bylaws and Section 5.3 of the Exchange Bylaws to 
provide that the President of the Parent or Exchange, as applicable, 
may be the chief operating officer of the Parent or Exchange, as 
applicable. Pursuant to this proposed change, the President of the 
Parent or Exchange may also serve as the chief operating officer,\6\ 
but, rather than requiring that one individual serve in both 
capacities, Parent and the Exchange will each have flexibility to 
appoint the person or persons it deems qualified and appropriate to 
perform the duties of the President and duties of a chief operating 
officer. In either case, Parent and the Exchange each will have one or 
more persons performing the necessary duties of each role.
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    \6\ This is consistent with the provision in each of the Parent 
Bylaws and Exchange Bylaws that provide that two or more offices may 
be held by the same person, subject to certain exceptions. See 
Section 5.1 of the Parent Bylaws and Section 5.1 of the Exchange 
Bylaws.
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Definition of Director Independence
    Cboe recently determined to remove from listing its common stock, 
par value $0.01 per share (the ``Common Stock''), on the Nasdaq Stock 
Market LLC (``Nasdaq'') and to designate BZX as the primary listing 
venue for Parent's Common Stock, which became effective in September 
2018. In connection with the delisting and primary listing venue 
designation, the Exchange proposes to update certain corporate 
governance documents, including the Parent Bylaws. Particularly, the 
Exchange proposes to amend Section 3.3 of the Parent Bylaws to change 
the definition of director independence from referencing the listing 
standards of the New York Stock Exchange and Nasdaq to language 
referencing the listing standards of each national securities exchange 
on which the common stock of Parent is listed.
Registered Office Zip Code
    The Exchange proposes to amend Section 1.1 of the Parent Bylaws to 
update the zip code of the Parent's registered agent from 19805 to 
19801. This change is in accordance with an update from the U.S. Postal 
Service.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\7\ Specifically, the Exchange believes the proposed rule change is 
consistent with Section 6(b)(1) of the Act,\8\ which provides that the 
Exchange be organized and have the capacity to be able to carry out the 
purposes of the Act and to enforce compliance by the Exchange's Trading 
Permit Holders and persons associated with its Trading Permit Holders 
with the Act, the rules and regulations thereunder, and the rules of 
the Exchange.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(1).
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    In particular, the Exchange believes the proposed changes are not 
material and will have a de minimis impact on the governance, 
ownership, or operations of the Exchange.
    The proposed rule change to permit the same person to hold the 
offices of Chief Executive Officer and President of the Exchange will 
enable the Exchange to continue to be organized and have the capacity 
to be able to carry out the purposes of the Act, because it will 
provide the Exchange with flexibility to appoint the person or persons 
it deems qualified and appropriate to perform the duties of both Chief 
Executive Officer and the President. The Exchange will continue to have 
a Chief Executive Officer and President--the proposed change merely 
permits a single person rather than multiple people to hold these 
offices. This will ensure continued orderly operation of the Exchange 
in a

[[Page 4882]]

manner the Exchange deems most appropriate.\9\
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    \9\ The proposed change also conforms this provision to the 
corresponding provision in Parent's Bylaws. See Section 5.1 of 
Parent's Bylaws.
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    The proposed rule change to permit each of Parent and the Exchange 
to appoint different persons to serve as President and chief operating 
officer of each entity will enable the Exchange to continue to be 
organized and have the capacity to be able to carry out the purposes of 
the Act, because it will provide each entity with flexibility to 
appoint the person or persons it deems qualified and appropriate to 
perform the duties of President and a chief operating officer. Parent 
and the Exchange each will continue to have the necessary duties of 
each role performed--the proposed change merely permits multiple people 
rather than a single person to perform these duties. This will ensure 
continued orderly operation of the Exchange in a manner Parent and the 
Exchange deem most appropriate.
    The Exchange believes in light of the delisting of Parent's Common 
Stock from Nasdaq, it is appropriate to remove the requirement to 
comply with the independence requirements contained in the listing 
standards of Nasdaq, as well as the independence requirements contained 
in the listing standards of NYSE. The Exchange notes that the 
independence requirements of BZX are substantially similar to the 
independence requirements contained in the listing standards of Nasdaq 
and NYSE.
    The Exchange believes that by ensuring its parent company's 
governance documents accurately reflect the correct legal address of 
Parent's registered office, the proposed rule change would reduce 
potential investor or market participant 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 proposed rule change is 
not intended to address competitive issues but rather is concerned 
solely with updating the Parent Bylaws and Exchange Bylaws to reflect 
the changes described above.

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

    The Exchange neither solicited nor received comments on the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A)(iii) of the Act \10\ and Rule 19b-4(f)(6) thereunder.\11\ 
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) by its terms, become 
operative prior to 30 days from the date on which it was filed, or such 
shorter time as the Commission may designate, if consistent with the 
protection of investors and the public interest, the proposed rule 
change has become effective pursuant to Section 19(b)(3)(A) of the Act 
and Rule 19b-4(f)(6) thereunder.
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    \10\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \11\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) \12\ normally 
does not become operative for 30 days after the date of filing. 
However, pursuant to Rule 19b-4(f)(6),\13\ the 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 proposal may 
become operative upon filing. The Exchange states that the proposed 
changes relating to the ability of the same person to hold multiple 
officer titles and the amended independence requirements are consistent 
with other national securities exchanges and will enable the Exchange 
to continue to be organized and have the capacity to be able to carry 
out the purposes of the Act, including protecting investors and the 
public interest. Further, the proposed change of updating the zip code 
of the Parent's registered office does not raise any regulatory issues. 
For the foregoing reasons, the Commission believes that waiving the 30-
day operative delay is consistent with the protection of investors and 
the public interest and, therefore, the Commission designates the 
proposed rule change to be operative upon filing.\14\
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    \12\ Id.
    \13\ Id.
    \14\ 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).
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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 will 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-CboeBZX-2019-002 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-CboeBZX-2019-002. 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

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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-CboeBZX-2019-002 and should 
be submitted on or before March 12, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-02605 Filed 2-15-19; 8:45 am]
 BILLING CODE 8011-01-P