[Federal Register Volume 84, Number 224 (Wednesday, November 20, 2019)]
[Notices]
[Pages 64136-64140]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-25103]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87537; File No. SR-Phlx-2019-48]


Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend the 
Customer Rebate Program

November 14, 2019.
    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 1, 2019, Nasdaq PHLX LLC (``Phlx'' or ``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 Exchange's Customer Rebate 
Program, as set forth in the Pricing Schedule at Options 7, Section 1, 
Part B.
    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
    The purpose of the proposed rule change is to amend the Exchange's 
Customer Rebate Program, as set forth in the Pricing Schedule at 
Options 7, Section 1, Part B. As described in greater detail below, the 
Exchange proposes to adopt an alternative method for members or member 
organizations (hereinafter, ``members'') to qualify for the program's 
Tier 2 rebates based on the member meeting a certain percentage 
threshold of total national Customer \3\ volume in multiply-listed 
options classes, reaching the Monthly Firm Fee Cap,\4\ and meeting the

[[Page 64137]]

Exchange's Market Access and Routing Subsidy (``MARS'') System 
Eligibility \5\ requirements. With the proposed changes, the Exchange 
seeks to attract additional liquidity and order flow to the Exchange, 
which will benefit all market participants from increased opportunities 
for price improvement.
---------------------------------------------------------------------------

    \3\ The term ``Customer'' applies to any transaction that is 
identified by a member for clearing in the Customer range at The 
Options Clearing Corporation (``OCC'') which is not for the account 
of a broker or dealer or for the account of a ``Professional'' (as 
that term is defined in Rule 1000(b)(14)). See Options 7, Section 1.
    \4\ Firms are subject to a maximum fee of $75,000 (``Monthly 
Firm Fee Cap''). Firm Floor Option Transaction Charges and QCC 
Transaction Fees, as set forth in Options 7, Section 4, in the 
aggregate, for one billing month will not exceed the Monthly Firm 
Fee Cap per member organization when such members are trading in 
their own proprietary account. All dividend, merger, and short stock 
interest strategy executions (as defined in this Options 7, Section 
4) will be excluded from the Monthly Firm Fee Cap. NDX and NDXP 
Options Transactions will be excluded from the Monthly Firm Fee Cap. 
Reversal and conversion, jelly roll and box spread strategy 
executions (as defined in this Options 7, Section 4) will be 
included in the Monthly Firm Fee Cap. QCC Transaction Fees are 
included in the calculation of the Monthly Firm Fee Cap. See Options 
7, Section 4.
    \5\ To qualify for MARS, a Phlx member's routing system 
(hereinafter ``System'') would be required to: (1) Enable the 
electronic routing of orders to all of the U.S. options exchanges, 
including Phlx; (2) provide current consolidated market data from 
the U.S. options exchanges; and (3) be capable of interfacing with 
Phlx's API to access current Phlx match engine functionality. 
Further, the member's System would also need to cause Phlx to be the 
one of the top five default destination exchanges for individually 
executed marketable orders if Phlx is at the national best bid or 
offer (``NBBO''), regardless of size or time, but allow any user to 
manually override Phlx as a default destination on an order-by-order 
basis. Notwithstanding the above, with respect to Complex Orders a 
Phlx member's routing system would not be required to enable the 
electronic routing of orders to all of the U.S. options exchanges or 
provide current consolidated market data from the U.S. options 
exchanges. Any Phlx member would be permitted to avail itself of 
this arrangement, provided that its order routing functionality 
incorporates the features described above and satisfies Phlx that it 
appears to be robust and reliable. The member remains solely 
responsible for implementing and operating its system. See Options 
7, Section 6, Part E.
---------------------------------------------------------------------------

Background
    Options 7, Section 4 sets forth a Monthly Firm Fee Cap that limits, 
or caps, at $75,000 per month the Firm \6\ Floor Option Transaction 
Charges and Firm QCC Transaction Fees incurred by members trading in 
their own proprietary account.\7\ The Monthly Firm Fee Cap is designed 
to provide an incentive for members to bring additional Firm floor and 
QCC order flow to the Exchange.
---------------------------------------------------------------------------

    \6\ The term ``Firm'' applies to any transaction that is 
identified by a member or member organization for clearing in the 
Firm range at OCC. See Options 7, Section 1.
    \7\ The Firm Floor Option Transaction Charges and QCC 
Transaction Fees are set forth in Options 7, Section 4. QCC 
Transaction Fees apply to both electronic and floor QCC orders.
---------------------------------------------------------------------------

    Options 7, Section 6, Part E sets forth the Exchange's MARS 
program, which provides rebates to qualifying members with System 
Eligibility and that execute the requisite number of Eligible Contracts 
\8\ in a month. MARS is designed to attract electronic equity and ETF 
options volume to the Exchange, particularly electronic Firm, Broker-
Dealer,\9\ JBO \10\ and Professional \11\ order flow.
---------------------------------------------------------------------------

    \8\ Eligible Contracts include the following: Firm, Broker-
Dealer, Joint Back Office or ``JBO'' or Professional equity option 
orders that are electronically delivered and executed. Eligible 
Contracts do not include floor-based orders, qualified contingent 
cross or ``QCC'' orders, price improvement or ``PIXL'' orders, Mini 
Option orders or Singly Listed Orders. Options overlying NDX and 
NDXP are not considered Eligible Contracts. See Options 7, Section 
6, Part E.
    \9\ The term ``Broker-Dealer'' applies to any transaction which 
is not subject to any of the other transaction fees applicable 
within a particular category.
    \10\ The term ``Joint Back Office'' or ``JBO'' applies to any 
transaction that is identified by a member or member organization 
for clearing in the Firm range at OCC and is identified with an 
origin code as a JBO. A JBO will be priced the same as a Broker-
Dealer. A JBO participant is a member, member organization or non-
member organization that maintains a JBO arrangement with a clearing 
broker-dealer (``JBO Broker'') subject to the requirements of 
Regulation T Section 220.7 of the Federal Reserve System as further 
discussed at Exchange Rule 703.
    \11\ The term ``Professional'' applies to transactions for the 
accounts of Professionals, as defined in Exchange Rule 1000(b)(14) 
means any person or entity that (i) is not a broker or dealer in 
securities, and (ii) places more than 390 orders in listed options 
per day on average during a calendar month for its own beneficial 
account(s).
---------------------------------------------------------------------------

    As set forth in Options 7, Section 1, Part B, the Exchange 
presently offers a Customer Rebate Program that is designed to attract 
electronic Customer order flow to the Exchange. In particular, the 
program consists of the following five tiers that pay Customer rebates 
on four Categories, A,\12\ B,\13\ C,\14\ D,\15\ of transactions: \16\
---------------------------------------------------------------------------

    \12\ The Category A Rebate is paid to members executing 
electronically-delivered Customer Simple Orders in Penny Pilot 
Options and Customer Simple Orders in Non-Penny Pilot Options in 
Options 7, Section 4 symbols.
    \13\ The Category B Rebate is paid on Customer PIXL Orders in 
Options 7, Section 4 symbols that execute against non-Initiating 
Order interest. In the instance where member qualify for Tier 4 or 
higher in the Customer Rebate Program, Customer PIXL Orders that 
execute against a PIXL Initiating Order are paid a rebate of $0.14 
per contract. Rebates on Customer PIXL Orders are capped at 4,000 
contracts per order for Simple PIXL Orders.
    \14\ The Category C Rebate is paid to members executing 
electronically-delivered Customer Complex Orders in Penny Pilot 
Options in Options 7, Section 4 symbols. Rebates are paid on 
Customer PIXL Complex Orders in Options 7, Section 4 symbols that 
execute against non-Initiating Order interest. Customer Complex PIXL 
Orders that execute against a Complex PIXL Initiating Order are not 
paid a rebate under any circumstances. The Category C Rebate is not 
paid when an electronically-delivered Customer Complex Order, 
including Customer Complex PIXL Order, executes against another 
electronically-delivered Customer Complex Order.
    \15\ The Category D Rebate is paid to members executing 
electronically-delivered Customer Complex Orders in Non-Penny Pilot 
Options in Options 7, Section 4 symbols. Rebates are paid on 
Customer PIXL Complex Orders in Options 7, Section 4 symbols that 
execute against non-Initiating Order interest. Customer Complex PIXL 
Orders that execute against a Complex PIXL Initiating Order are not 
paid a rebate under any circumstances. The Category D Rebate is not 
paid when an electronically-delivered Customer Complex Order, 
including Customer Complex PIXL Order, executes against another 
electronically-delivered Customer Complex Order.
    \16\ Rebates are not paid on NDX or NDXP contracts in any 
Category; however, NDX and NDXP contracts count toward the volume 
requirement to qualify for a Customer Rebate Tier.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                    Percentage Thresholds of National
                                                    Customer Volume in Multiply-Listed
             Customer Rebate Tiers                   Equity and ETF Options Classes,        Category A      Category B      Category C      Category D
                                                     excluding SPY Options (monthly)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Tier 1.........................................  0.00%-0.60%............................           $0.00           $0.00           $0.00           $0.00
Tier 2.........................................  Above 0.60%-1.10%......................            0.10            0.10            0.16            0.21
Tier 3.........................................  Above 1.10%-1.60%......................            0.15            0.12            0.18            0.22
Tier 4.........................................  Above 1.60%-2.50%......................            0.20            0.16            0.22            0.26
Tier 5.........................................  Above 2.50%............................            0.21            0.17            0.22            0.27
--------------------------------------------------------------------------------------------------------------------------------------------------------

    A Phlx member qualifies for a particular Customer Rebate Tier based 
on the percentage of total national Customer volume in multiply-listed 
options that it transacts monthly on the Exchange. Specifically, the 
Exchange totals Customer volume in multiply listed options (including 
SPY) that is electronically-delivered and executed, except volume 
associated with electronic QCC Orders, as defined in Exchange Rule 
1080(o), and calculates this as a percentage of total national customer 
volume in multiply-listed equity and ETF options classes, excluding 
SPY. Members under

[[Page 64138]]

Common Ownership \17\ may aggregate their Customer volume for purposes 
of calculating the Customer Rebate Tiers and receiving rebates. 
Affiliated Entities \18\ may aggregate their Customer volume for 
purposes of calculating the Customer Rebate Tiers and receiving 
rebates.
---------------------------------------------------------------------------

    \17\ The term ``Common Ownership'' shall mean members or member 
organizations under 75% common ownership or control. See Options 7, 
Section 1.
    \18\ The term ``Affiliated Entity'' is a relationship between an 
Appointed MM and an Appointed OFP for purposes of qualifying for 
certain pricing specified in the Pricing Schedule. Members under 
Common Ownership may not qualify as a counterparty comprising an 
Affiliated Entity. Each member may qualify for only one (1) 
Affiliated Entity relationship at any given time. See Options 7, 
Section 1.
---------------------------------------------------------------------------

Proposal
    The Exchange now proposes to adopt an alternative method for 
members to qualify for the applicable Tier 2 rebates described above. 
As discussed above, the proposed alternative will be based on the 
member meeting a certain percentage threshold of total national 
Customer volume in multiply-listed options classes, reaching the 
Monthly Firm Fee Cap, and meeting the MARS System Eligibility 
requirements. Specifically, the Exchange proposes to add the following 
language at the end of Options 7, Section 1, Part B: ``The Exchange 
will pay the applicable Tier 2 rebates to qualifying members or member 
organizations, qualifying affiliates under Common Ownership, or 
qualifying Affiliated Entities, provided they: (1) Execute a Percentage 
Threshold of National Customer Volume in Multiply-Listed Equity and ETF 
Options Classes, excluding SPY Options (monthly), of above 0.25%; (2) 
reach the Monthly Firm Fee Cap as defined in Options 7, Section 4; and 
(3) meet the MARS System Eligibility requirements as provided in 
Options 7, Section 6, Part E.''
Applicability to and Impact on Participants
    The proposed change is designed to incentivize members who reach 
the Monthly Firm Fee Cap and have MARS System Eligibility to increase 
their electronic Customer volume to qualify for the applicable Tier 2 
rebates. The proposal may correspondingly encourage members to qualify 
for the Monthly Firm Fee Cap and the MARS System Eligibility 
requirements (which should increase Firm floor volume and Firm QCC 
volume as well as electronic Firm, Broker-Dealer, JBO and Professional 
volume). The Exchange notes that all market participants stand to 
benefit from increased volume, which facilitates tighter spreads and 
enhances price discovery, and may lead to a corresponding increase in 
order flow from other market participants.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\19\ in general, and furthers the objectives of 
Sections 6(b)(4) and 6(b)(5) of the Act,\20\ in particular, in that it 
provides for the equitable allocation of reasonable dues, fees and 
other charges among members and issuers and other persons using any 
facility, and is not designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \19\ 15 U.S.C. 78f(b).
    \20\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

The Proposal is Reasonable
    The Exchange believes that the proposed alternative method to 
qualify for the applicable Tier 2 rebates in the Customer Rebate 
Program is reasonable for several reasons. As a threshold matter, the 
Exchange is subject to significant competitive forces in the market for 
options transaction services that constrain its pricing determinations 
in that market. The fact that this market is competitive has long been 
recognized by the courts. In NetCoalition v. Securities and Exchange 
Commission, the D.C. Circuit stated as follows: ``[n]o one disputes 
that competition for order flow is `fierce.' . . . As the SEC 
explained, `[i]n the U.S. national market system, buyers and sellers of 
securities, and the broker-dealers that act as their order-routing 
agents, have a wide range of choices of where to route orders for 
execution'; [and] `no exchange can afford to take its market share 
percentages for granted' because `no exchange possesses a monopoly, 
regulatory or otherwise, in the execution of order flow from broker 
dealers'. . . .'' \21\
---------------------------------------------------------------------------

    \21\ NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010) 
(quoting Securities Exchange Act Release No. 59039 (December 2, 
2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSEArca-2006-
21)).
---------------------------------------------------------------------------

    Numerous indicia demonstrate the competitive nature of this market. 
For example, clear substitutes to the Exchange exist in the market for 
options transaction services. The Exchange is only one of sixteen 
options exchanges to which market participants may direct their order 
flow. Competing options exchanges offer similar tiered pricing 
structures to that of the Exchange, including tiered rebates that apply 
based upon members achieving certain volume thresholds.\22\ Within this 
environment, market participants can freely and often do shift their 
order flow among the Exchange and competing venues in response to 
changes in their respective pricing schedules.
---------------------------------------------------------------------------

    \22\ See, e.g., NYSE American Options Fee Schedule, Section I.E 
(setting forth the American Customer Engagement (``ACE'') Program 
that provides tiered customer credits on customer electronic volume, 
provided the member achieves certain total industry customer equity 
and ETF option average daily volume percentage thresholds), Section 
I.H (setting forth the Professional Step-Up Incentive that provides 
discounted rates or credits, as applicable, to professional 
customer, broker-dealer, non-NYSE American Options market maker, and 
firm ranges, and also ties some of these benefits to the ACE 
Program), and Section I.I (setting forth the Firm Monthly Fee Cap 
that caps at $100,000 per month the fees associated with Firm Manual 
transactions, and also lowers the firm fee cap for members that 
achieve the applicable ACE Program tiers).
---------------------------------------------------------------------------

    Within the foregoing context, the proposal represents a reasonable 
attempt by the Exchange to increase its liquidity and market share 
relative to its competitors. The Exchange's proposal is designed to 
attract additional liquidity and order flow to the Exchange, similar to 
other exchange programs with competitive pricing programs,\23\ thereby 
promoting market depth, price discovery and improvement, and enhancing 
order execution opportunities for market participants. As discussed 
above, the proposed changes provide an additional opportunity for 
members to earn the applicable Tier 2 Customer rebates if they execute 
a percentage threshold of national Customer volume in multiply-listed 
equity and ETF options classes, excluding SPY options, of above 0.25% 
on the Exchange, reach the Monthly Firm Fee Cap, and have MARS System 
Eligibility. Today, the Exchange provides the same Tier 2 rebates to 
members that execute a percentage threshold of national Customer volume 
in multiply-listed equity and ETF options classes, excluding SPY 
options, of above 0.60% to 1.10% on the Exchange. This proposal would 
offer members an alternative route to earn the same Tier 2 rebates, 
provided they meet the lower percentage threshold of above 0.25% and 
also qualify for both the Monthly Firm Fee Cap and the MARS System 
Eligibility requirements. The Exchange believes that the proposed 
percentage threshold is set at an appropriate level that would 
encourage members to bring more Customer order flow to the Exchange to 
qualify for the applicable Tier 2 rebates. While the Exchange cannot 
predict with certainty whether any members would avail themselves of 
the proposed incentive

[[Page 64139]]

given that this incentive is new, assuming historical behavior can be 
predictive of future behavior, the Exchange believes that at present 
participation rates, almost 30% of active firms on the Exchange have 
comparable trading volume in the Customer category. The Exchange also 
believes that the proposed lower percentage threshold (i.e., above 
0.25% versus the current Tier 2 threshold of above 0.60% to 1.10%) is 
reasonable because members must meet additional qualifications (i.e., 
reach the Monthly Firm Fee Cap and have MARS System Eligibility) under 
the proposed alternative method to receive the Tier 2 rebates on 
Customer transactions.
---------------------------------------------------------------------------

    \23\ Id.
---------------------------------------------------------------------------

    Furthermore, the Exchange believes that its proposal will encourage 
members to increase the amount of Customer order flow directed to the 
Exchange. In addition, because members will also be required to reach 
the Monthly Firm Fee Cap and have MARS System Eligibility to receive 
the applicable Tier 2 Customer rebates, the proposed program may 
encourage members to direct Firm floor and QCC order flow as well as 
electronic Firm, Broker-Dealer, JBO and Professional order flow, in 
addition to electronic Customer order flow. The Exchange notes that all 
market participants stand to benefit from increased order flow--whether 
Customer, Firm, Broker-Dealer, JBO or Professional, and whether floor 
or electronic--as such increase promotes market depth, facilitates 
tighter spreads, enhances price discovery, and may lead to an increase 
in order flow from other market participants that would not otherwise 
qualify for the proposed alternative route to the Tier 2 Customer 
rebates.
The Proposal Is an Equitable Allocation of Rebates
    The Exchange believes that its proposal is an equitable allocation 
of the applicable Tier 2 rebates. The proposal is based on the amount 
and type of business transacted on the Exchange, and members can opt to 
avail themselves of these rebates or not. Furthermore, this proposal is 
designed to encourage members to bring and execute their order flow 
(particularly electronic Customer volume and, in turn, Firm floor, QCC, 
and electronic Firm, Broker-Dealer, JBO and Professional volume) to the 
Exchange. To the extent at the proposed changes attract such additional 
volume to the Exchange, this increased order flow would continue to 
make the Exchange a more competitive venue for, among other things, 
order execution. Thus, the Exchange believes the proposed changes would 
improve market quality for all market participants on the Exchange, and 
increase its attractiveness to existing and prospective members.
The Proposal Is Not Unfairly Discriminatory
    The Exchange believes that its proposal is not unfairly 
discriminatory. As an initial matter, the Exchange believes that 
nothing about its volume-based tiered pricing model is inherently 
unfair; instead, it is a rational pricing model that is well-
established and ubiquitous in today's economy among firms in various 
industries--from co-branded credit cards to grocery stores to cellular 
telephone data plans--that use it to reward the loyalty of their best 
customers that provide high levels of business activity and incent 
other customers to increase the extent of their business activity. It 
is also a pricing model that the Exchange and its competitors have long 
employed with the assent of the Commission. It is fair because it 
incentivizes customer activity that increases liquidity, enhances price 
discovery, and improves the overall quality of the options market.
    As discussed above, the proposal is based on the amount and type of 
business transacted on the Exchange, and members are not obligated to 
try to achieve the proposed alternative route to the Tier 2 Customer 
rebates. Rather, the proposal is designed to encourage these members to 
bring additional order flow (particularly electronic Customer volume 
and, in turn, Firm floor, QCC, and electronic Firm, Broker-Dealer, JBO 
and Professional volume) to the Phlx market, improving market quality 
and price discovery. The Exchange believes that the proposed 
qualification for the Tier 2 Customer rebates is not unfairly 
discriminatory because to the extent the proposed changes attract more 
volume to the Exchange, this increased order flow would continue to 
make the Exchange a more competitive venue for order execution, among 
other things. As noted above, all market participants stand to benefit 
from increased order flow--whether Customer, Firm, Broker-Dealer, JBO 
or Professional, and whether floor or electronic--as such increase 
promotes market depth, facilitates tighter spreads, enhances price 
discovery, and may lead to an increase in order flow from other market 
participants that would not otherwise qualify for the proposed 
alternative route to the Tier 2 Customer rebates. Thus, the Exchange 
believes the proposed changes will help to improve market quality and 
the attractiveness of the Exchange's options market to all existing and 
prospective members.

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.
Intramarket Competition
    The proposed amendments to the Exchange's Customer Rebate Program 
described above do not impose an undue burden on intra-market 
competition. By fortifying participation in this program, the proposed 
changes are designed to attract additional order flow (particularly 
electronic Customer volume and, in turn, Firm floor, QCC, and 
electronic Firm, Broker-Dealer, JBO and Professional volume) to the 
Exchange. The Exchange believes that its proposal would incentivize 
market participants to direct additional volume to the Exchange. As 
noted above, all market participants stand to benefit from increased 
order flow as such increase promotes market depth, facilitates tighter 
spreads, enhances price discovery, and may attract additional liquidity 
and volume to the Exchange. For these reasons, the Exchange does not 
believe that its proposal will place any category of Exchange market 
participant at a competitive disadvantage.
Inter-Market Competition
    The Exchange operates in a highly competitive market in which 
market participants can readily favor one of 16 competing options 
exchanges if they deem fee levels at a particular venue to be 
excessive, or rebate opportunities available at other venues to be more 
favorable. In such an environment, the Exchange must continually adjust 
its fees and rebates to remain competitive with other exchanges and to 
attract order flow to the Exchange. Because competitors are free to 
modify their own fees and rebates in response, the Exchange believes 
that the degree to which pricing changes in this market may impose any 
burden on competition is extremely limited.
    Moreover, as noted above, price competition between exchanges is 
fierce, with liquidity and market share moving freely between exchanges 
in reaction to fee and rebate changes. In sum, if the changes proposed 
herein are unattractive to market participants, it is likely that the 
Exchange will lose market share as a result. Accordingly, the Exchange 
does not believe that the proposed changes will impair the ability of 
members or competing order execution venues to maintain their

[[Page 64140]]

competitive standing in the financial markets.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act.\24\
---------------------------------------------------------------------------

    \24\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------

    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: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) 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-2019-48 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-2019-48. 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-2019-48 and should be submitted on 
or before December 11, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\25\
---------------------------------------------------------------------------

    \25\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-25103 Filed 11-19-19; 8:45 am]
 BILLING CODE 8011-01-P