[Federal Register Volume 84, Number 172 (Thursday, September 5, 2019)]
[Notices]
[Pages 46765-46767]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-19107]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-86811; File No. SR-CboeBZX-2019-079]
Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To
Introduce a New Data Product on Its Equity Options Platform (``BZX
Options'') To Be Known As Open-Close Data
August 29, 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 August 21, 2019, Cboe BZX Exchange, Inc. (the ``Exchange'' or
``BZX'') 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 Exchange
filed the proposal as a ``non-controversial'' 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.
---------------------------------------------------------------------------
\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).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Cboe BZX Exchange, Inc. (the ``Exchange'' or ``BZX'') is filing
with the Securities and Exchange Commission
[[Page 46766]]
(``Commission'') a proposed rule change to introduce a new data product
on its equity options platform (``BZX Options'') to be known as Open-
Close Data. The text of the proposed rule change is provided in Exhibit
5.
The text of the proposed rule change is also available on the
Exchange's website (http://markets.cboe.com/us/equities/regulation/rule_filings/bzx/), 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 Exchange proposes to introduce a new data product on BZX
Options to be known as Open-Close Data, which will be available for
purchase to BZX Options Members and Non-Members.\5\ Cboe LiveVol, LLC
(``LiveVol''), a wholly owned subsidiary of the Exchange's parent
company, Cboe Global Markets, Inc., will make the Open-Close Data
available for purchase to Members and Non-Members on the LiveVol
DataShop website (datashop.cboe.com). The Exchange also proposes to
amend Exchange Rule 21.15(b) to add a description of the Open-Close
Data product.
---------------------------------------------------------------------------
\5\ The Exchange intends to submit a rule filing to establish
fees for Open-Close Data.
---------------------------------------------------------------------------
A description of each market data product offered by the Exchange
is described in Exchange Rule 21.15(b). The Exchange proposes to amend
Rule 21.15(b) to introduce and add a description of the Open-Close Data
product under proposed new subparagraph (5). The Exchange proposes to
describe the Open-Close Data as ``a data product that summarizes volume
(contracts traded on BZX Options) by origin (customer and firm orders),
original order size and the opening or closing position of the order.''
The volume data is also summarized by day and series (symbol,
expiration date, strike price, call or put). The Open-Close Data would
be available for purchase to both BZX Members and Non-Members on a
subscription and ad-hoc basis. The Exchange notes that its affiliate,
Cboe Exchange, Inc. (``Cboe Options''), as well as other exchanges,
offer a similar data product.\6\
---------------------------------------------------------------------------
\6\ See Securities Exchange Act Release No. 55062 (January 8,
2007), 72 FR 2048 (January 17, 2007) (approving SR-CBOE-2006-88);
See also Securities Exchange Act Release No. 56254 (August 15,
2007), 72 FR 47104 (August 22, 2007) (SR-ISE-2007-70).
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\7\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\8\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
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 to protect investors and the public
interest, and that it is not designed to permit unfair discrimination
among customers, brokers, or dealers.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f.
\8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
In adopting Regulation NMS, the Commission granted self-regulatory
organizations (``SROs'') and broker-dealers increased authority and
flexibility to offer new and unique market data to the public. It was
believed that this authority would expand the amount of data available
to consumers, and also spur innovation and competition for the
provision of market data. The Exchange believes that the proposed Open-
Close Data would further broaden the availability of U.S. option market
data to investors consistent with the principles of Regulation NMS. The
proposal also promotes increased transparency through the dissemination
of Open-Close Data. The proposed rule change would benefit investors by
providing access to the Open-Close Data, which may promote better
informed trading. Moreover, the Exchange's affiliate Cboe Options,
along with other exchanges, also offer a similar data product.\9\
---------------------------------------------------------------------------
\9\ See Securities Exchange Act Release No. 55062 (January 8,
2007), 72 FR 2048 (January 17, 2007) (approving SR-CBOE-2006-088);
See also Securities Exchange Act Release No. 56254 (August 15,
2007), 72 FR 47104 (August 22, 2007) (SR-ISE-2007-70).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. Rather, the
Exchange believes that the proposal will promote competition by
permitting the Exchange to offer a data product similar to those
offered by other competitor options exchanges.\10\ The Exchange is
proposing to introduce Open-Close Data for BZX Options in order to keep
pace with changes in the industry and evolving customer needs, and
believes this proposed rule change would contribute to robust
competition among national securities exchanges. As noted, at least
three other U.S. options exchanges offer a market data product that is
substantially similar to the Open-Close Data. As a result, the Exchange
believes this proposed rule change permits fair competition among
national securities exchanges. Therefore, the Exchange does not believe
the proposed rule change will result in any burden on competition that
is not necessary or appropriate in furtherance of the purposes of the
Act.
---------------------------------------------------------------------------
\10\ Id.
---------------------------------------------------------------------------
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange has neither solicited nor received written comments on
the proposed rule change.
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) of the Act \11\ and Rule 19b-
4(f)(6) thereunder.\12\
---------------------------------------------------------------------------
\11\ 15 U.S.C. 78s(b)(3)(A).
\12\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-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.
---------------------------------------------------------------------------
A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act \13\ normally does not become operative for 30 days after the date
of its
[[Page 46767]]
filing. However, Rule 19b-4(f)(6)(iii) \14\ 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 asked
the Commission to waive the 30-day operative delay so that the Exchange
may implement the proposed rule change on September 1, 2019, the
anticipated date upon which the Exchange expects to offer Open-Close
Data. The Exchange believes waiver of the operative delay is consistent
with the protection of investors and the public interest because the
proposed rule change presents no new or novel issues, as other
exchanges currently offer a similar data product.\15\ For this reason,
the Commission believes that waiver of the 30-day operative delay is
consistent with the protection of investors and the public interest.
Therefore, the Commission hereby waives the operative delay and
designates the proposal as operative upon filing.\16\
---------------------------------------------------------------------------
\13\ 17 CFR 240.19b-4(f)(6).
\14\ 17 CFR 240.19b-4(f)(6)(iii).
\15\ See supra note 6.
\16\ 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).
---------------------------------------------------------------------------
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-CboeBZX-2019-079 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-2019-079. 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-CboeBZX-2019-079 and should be submitted
on or before September 26, 2019.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
---------------------------------------------------------------------------
\17\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-19107 Filed 9-4-19; 8:45 am]
BILLING CODE 8011-01-P