[Federal Register Volume 85, Number 13 (Tuesday, January 21, 2020)]
[Notices]
[Pages 3435-3437]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-00802]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87964; File No. SR-MIAX-2020-01]


Self-Regulatory Organizations; Miami International Securities 
Exchange LLC; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend Its Fee Schedule

January 14, 2020.
    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 January 3, 2020, Miami International Securities Exchange LLC (``MIAX 
Options'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``SEC'' or ``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.
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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 the MIAX Options Fee 
Schedule (the ``Fee Schedule'').
    The text of the proposed rule change is available on the Exchange's 
website 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 the list of MIAX Select Symbols \3\ 
contained in the Priority Customer Rebate Program (the ``Program'') \4\ 
of the Exchange's Fee Schedule to delete the Select Symbols ``CELG,'' 
``HTZ'' and ``WY'' from the Select Symbols list.
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    \3\ The term ``MIAX Select Symbols'' means options overlying 
AAL, AAPL, AIG, AMAT, AMD, AMZN, BA, BABA, BB, BIDU, BP, C, CAT, 
CELG, CLF, CVX, DAL, EBAY, EEM, FB, FCX, GE, GILD, GLD, GM, GOOGL, 
GPRO, HAL, HTZ, INTC, IWM, JCP, JNJ, JPM, KMI, KO, MO, MRK, NFLX, 
NOK, ORCL, PBR, PFE, PG, QCOM, QQQ, RIG, S, SPY, T, TSLA, USO, VALE, 
WBA, WFC, WMB, WY, X, XHB, XLE, XLF, XLP, XOM and XOP.
    \4\ See section 1(a)(iii) of the Fee Schedule for a complete 
description of the Program.
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    The Exchange initially created the list of MIAX Select Symbols on 
March 1, 2014,\5\ and has added and removed option classes from that 
list since that time.\6\ Select Symbols are rebated slightly higher in 
certain Program tiers than non-Select Symbols. The Exchange notes that 
historically, Select Symbols generally include a subset of classes of 
options that are included in the Penny Pilot Program, an industry-wide 
pilot program that provides for the quoting and trading of certain 
option classes in penny increments (the ``Penny Pilot Program''). The 
Penny Pilot Program allows the quoting and trading of certain option 
classes in minimum increments of $0.01 for all series in such option 
classes with a price of less than $3.00; and in minimum increments of 
$0.05 for all series in such option classes with a price of $3.00 or 
higher. The Penny Pilot Program was initiated at the then existing 
option exchanges in January 2007 \7\ and currently includes more than 
300 of the most active option classes.
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    \5\ See Securities Exchange Act Release No. 71700 (March 12, 
2014), 79 FR 15188 (March 18, 2014) (SR-MIAX-2014-13).
    \6\ See Securities Exchange Act Release Nos. 87790 (December 18, 
2019), 84 FR 71037 (December 26, 2019) (SR-MIAX-2019-49); 85314 
(March 14, 2019), 84 FR 10359 (March 20, 2019) (SR-MIAX-2019-07; 
81998 (November 2, 2017), 82 FR 51897 (November 8, 2017) (SR-MIAX-
2017-45); 81019 (June 26, 2017), 82 FR 29962 (June 30, 2017) (SR-
MIAX-2017-29); 79301 (November 14, 2016), 81 FR 81854 (November 18, 
2016) (SR-MIAX-2016-42); 74291 (February 18, 2015), 80 FR 9841 
(February 24, 2015) (SR-MIAX-2015-09); 74288 (February 18, 2015), 80 
FR 9837 (February 24, 2015) (SR-MIAX-2015-08); 73328 (October 9, 
2014), 79 FR 62230 (October 16, 2014) (SR-MIAX-2014-50); 72567 (July 
8, 2014), 79 FR 40818 (July 14, 2014) (SR-MIAX-2014-34); 72356 (June 
10, 2014), 79 FR 34384 (June 16, 2014) (SR-MIAX-2014-26); 71700 
(March 12, 2014), 79 FR 15188 (March 18, 2014) (SR-MIAX-2014-13).
    \7\ See Securities Exchange Act Release Nos. 55154 (January 23, 
2007), 72 FR 4743 (February 1, 2007) (SR-CBOE-2006-92); 55161 
(January 24, 2007), 72 FR 4754 (February 1, 2007) (SR-ISE-2006-62); 
54886 (December 6, 2006), 71 FR 74979 (December 13, 2006) (SR-Phlx-
2006-74); 54590 (October 12, 2006), 71 FR 61525 (October 18, 2006) 
(SR-NYSEArca-2006-73); and 54741 (November 9, 2006), 71 FR 67176 
(November 20, 2006) (SR-Amex-2006-106). See also Exchange Rule 510, 
Interpretation and Policy .01.
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    The Exchanges notes that current Select Symbol ``CELG'' will no 
longer be included in the Penny Pilot Program industry-wide beginning 
January 3, 2020 and Select Symbols ``HTZ'' and ``WY'' are no longer in 
the Penny Pilot Program. Accordingly, for business and competitive 
reasons, the Exchange proposes to amend the Fee Schedule to delete the 
symbols ``CELG,'' ``HTZ'' and ``WY'' from the list of MIAX Select 
Symbols contained in the Program as those Select Symbols are no longer 
in the Penny Pilot Program.XYZ

[[Page 3436]]

2. Statutory Basis
    The Exchange believes that its proposal to amend the Fee Schedule 
is consistent with Section 6(b) of the Act \8\ in general, and furthers 
the objectives of Section 6(b)(4) of the Act,\9\ in that it is an 
equitable allocation of reasonable dues, fees and other charges among 
Exchange members and issuers and other persons using its facilities, 
and 6(b)(5) of the Act,\10\ 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 and is not 
designed to permit unfair discrimination between customers, issuers, 
brokers and dealers.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(4).
    \10\ 15 U.S.C. 78f(b)(1) and (b)(5).
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    In particular, the proposal to delete the symbols ``CELG,'' ``HTZ'' 
and ``WY'' from the list of MIAX Select Symbols contained in the 
Program is consistent with Section 6(b)(4) of the Act because the 
proposed changes will allow for continued benefit to investors by 
providing them an updated list of MIAX Select Symbols contained in the 
Program on the Fee Schedule.
    The Exchange believes that the proposal to amend an option class 
that qualifies for the credit for transactions in MIAX Select Symbols 
is fair, equitable and not unreasonably discriminatory. The Exchange 
believes that the Program itself is reasonably designed because it 
incentivizes providers of Priority Customer \11\ order flow to send 
that Priority Customer order flow to the Exchange in order to receive a 
credit in a manner that enables the Exchange to improve its overall 
competitiveness and strengthen its market quality for all market 
participants. The Program, which provides increased incentives in 
certain tiers in high volume select symbols, is also reasonably 
designed to increase the competitiveness of the Exchange with other 
options exchanges that also offer increased incentives to higher volume 
symbols.
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    \11\ The term ``Priority Customer'' means a person or entity 
that (i) is not a broker or dealer in securities, and (ii) does not 
place more than 390 orders in listed options per day on average 
during a calendar month for its own beneficial account(s). See 
Exchange Rule 100.
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    The Exchange also believes that its proposal is consistent with 
Section 6(b)(5) of the Act because it will apply equally to all 
Priority Customer orders in MIAX Select Symbols in the Program. All 
similarly situated Priority Customer orders in MIAX Select Symbols are 
subject to the same rebate schedule, and access to the Exchange is 
offered on terms that are not unfairly discriminatory.

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. The proposed 
rule change should enable the Exchange to continue to attract and 
compete for order flow with other exchanges. Notwithstanding the 
removal of the symbols CELG, HTZ and WY from the Select Symbols list, 
the Exchange's rebates remain highly competitive with those of other 
exchanges, and therefore should enable the Exchange to continue to 
attract and compete for order flow with other exchanges which offer 
comparable rebates for particular symbols. The Exchange notes that it 
operates in a highly competitive market in which market participants 
can readily favor competing venues if they deem fee levels at a 
particular venue to be excessive. In such an environment, the Exchange 
must continually adjust its fees and rebates to remain competitive with 
other exchanges and to attract order flow.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act,\12\ and Rule 19b-4(f)(2) \13\ thereunder. 
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.
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    \12\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \13\ 17 CFR 240.19b-4(f)(2).
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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-MIAX-2020-01 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-2020-01. 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-MIAX-2020-01, and should be submitted on 
or before February 11, 2020.


[[Page 3437]]


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-00802 Filed 1-17-20; 8:45 am]
BILLING CODE 8011-01-P