[Federal Register Volume 85, Number 58 (Wednesday, March 25, 2020)]
[Notices]
[Pages 16981-16985]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-06188]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-88424; File No. SR-CBOE-2019-035]
Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of
Filing of Amendment Nos. 1 and 2 and Order Granting Accelerated
Approval of a Proposed Rule Change, as Modified by Amendment Nos. 1 and
2, Regarding Off-Floor Position Transfers
March 19, 2020.
I. Introduction
On July 3, 2019, Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe
Options'') filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ a
proposed rule change to amend its rule relating to off-floor position
transfers. The proposed rule change was published for comment in the
Federal Register on July 23, 2019.\3\ On August 6, 2019, the Exchange
filed Amendment No. 1 to the proposed rule change.\4\ On September 4,
2019, the Commission extended the time period within which to either
approve the proposed rule change, disapprove the proposed rule change,
or institute proceedings to determine whether to approve or disapprove
the propose rule change, to October 21, 2019.\5\ On October 7, 2019,
the Exchange filed Amendment No. 2 to the proposed rule change.\6\ The
Commission received two comment letters on the proposal.\7\
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ See Securities Exchange Act Release No. 86400 (July 17,
2019), 84 FR 35438 (``Notice'').
\4\ In Amendment No. 1, the Exchange deleted from the proposed
rule change the proposal to permit off-floor risk-weighted asset
(``RWA'') transfers. The Exchange subsequently refiled the RWA
transfer proposal as a separate proposed rule change filing in SR-
CBOE-2019-044. See Securities Exchange Release No. 87107 (September
25, 2019), 84 FR 52149 (October 1, 2019) (order approving proposed
rule change to adopt Cboe Rule 6.49B regarding off-floor RWA
transfers). When the Exchange filed Amendment No. 1 to CBOE-2019-
035, it also submitted the text of the amendment as a comment letter
to the filing, which the Commission made publicly available at
https://www.sec.gov/comments/sr-cboe-2019-035/srcboe2019035-5917170-189047.pdf.
\5\ See Securities Exchange Act Release No. 86861 (September 4,
2019), 84 FR 47627 (September 10, 2019).
\6\ In Amendment No. 2, the Exchange updated cross-references to
Cboe rules throughout the proposed rule change to reflect separate
amendments it made to its rulebook in connection with the Exchange's
technology migration, which it subsequently completed on October 7,
2019. When the Exchange filed Amendment No. 2 to CBOE-2019-035, it
also submitted the text of the amendment as a comment letter to the
filing, which the Commission made publicly available at https://www.sec.gov/comments/sr-cboe-2019-035/srcboe2019035-6258833-192955.pdf. In addition to the cross-references updated in Amendment
No. 2, the Exchange relocated Rule 6.49A to Rule 6.7 in its post-
migration rulebook and made conforming changes to its proposed rule
change to reflect that new rule number.
\7\ See Letter to Vanessa Countryman, Secretary, Commission,
dated September 24, 2019, from John Kinahan, Chief Executive
Officer, Group One Trading, L.P., available at https://www.sec.gov/comments/sr-cboe-2019-035/srcboe2019035-6193332-192497.pdf (``Group
One Letter'') and Letter to Brent J. Fields, Secretary, Commission,
dated August 19, 2019, from Gerald D. O'Connell, Compliance
Coordinator, Susquehanna International Group, LLP, available at
https://www.sec.gov/comments/sr-cboe-2019-035/srcboe2019035-5985436-190350.pdf (``SIG August 2019 Letter'').
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On October 21, 2019, the Commission instituted proceedings to
determine whether to approve or disapprove the proposed rule changes
(``OIP'').\8\ The Commission received a letter from the Exchange
addressing the previous comments,\9\ as well as one additional comment
in response to the OIP and the Cboe Response Letter.\10\ On January 14,
[[Page 16982]]
2020, the Commission issued a notice of designation of a longer period
for Commission action on proceedings to determine whether to approve or
disapprove the proposed rule change.\11\ This order approves the
proposed rule change, as modified by Amendment Nos. 1 and 2, on an
accelerated basis.
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\8\ See Securities Exchange Act Release No. 87374, 84 FR 57542
(October 25, 2019) (``OIP'').
\9\ See Letter to Vanessa Countryman, Secretary, Commission,
dated November 15, 2019, from Laura G. Dickman, Vice President,
Associate General Counsel, Cboe Exchange, Inc., available at https://www.sec.gov/comments/sr-cboe-2019-035/srcboe2019035-6434377-198588.pdf (``Cboe Response Letter'').
\10\ See Letter to Vanessa Countryman, Secretary, Commission,
dated December 12, 2019, from Gerald D. O'Connell, Compliance
Coordinator, Susquehanna International Group, LLP, available at
https://www.sec.gov/comments/sr-cboe-2019-035/srcboe2019035-6535880-200548.pdf (``SIG December 2019 Letter'').
\11\ See Securities Exchange Act Release No. 87959 (January 14,
2020), 85 FR 3448 (January 21, 2020).
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II. Description of the Proposed Rule Change
Cboe generally requires a Trading Permit Holder (``TPH'') to effect
transactions in listed options on an exchange.\12\ Notwithstanding that
provision, Cboe permits certain types of transfers involving a TPH's
positions to be effected off the Exchange (also referred to as ``off-
floor'' transfers).\13\ The Exchange now proposes to delineate in Rule
6.7 (Off-Floor Transfers of Positions) four additional types of
permitted off-floor transfers: (1) Transfers to correct a bona fide
error in the recording of a transaction or the transferring of a
position to another account, (2) transfers between accounts where there
is no change in ownership provided the accounts are not in separate
aggregation units or otherwise subject to information barrier or
account segregation requirements, (3) consolidation of accounts where
no change in ownership is involved, and (4) transfers through operation
of law from death, bankruptcy, or otherwise.\14\
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\12\ See Cboe Rule 5.12(a) (formerly Rule 6.49(a)).
\13\ See Cboe Rule 6.7(a) (formerly Rule 6.49A(a)).
\14\ See proposed Cboe Rule 6.7(a).
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In addition, the Exchange purports to codify its prior guidance
that off-floor transfers cannot net against another position and that
no position transfer may result in preferential margin or haircut
treatment.\15\ Further, the Exchange purports to codify into Rule 6.7
its interpretation that the off-floor transfer rule ``is intended to
facilitate non-routine, non-recurring movements of positions'' and ``is
not to be used repeatedly or routinely in circumvention of the normal
auction market process.'' \16\
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\15\ See proposed Cboe Rule 6.7(b). See also Cboe Options
Regulatory Circular RG03-62 (July 24, 2003).
\16\ See proposed Cboe Rule 6.7(g).
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Finally, as discussed more fully in the Notice,\17\ the Exchange
proposes other modifications to Rule 6.7, including adding provisions
that would provide guidance as to the permitted transfer price at which
an off-floor transfer may be effected, specify when written notice
would be required prior to effecting an off-floor transfer, and provide
for recordkeeping requirements.\18\
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\17\ See Notice, supra note 3.
\18\ See proposed Cboe Rule 6.7(c), (d), and (e).
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III. Discussion and Commission Findings
After careful review of the proposal, as modified by Amendment Nos.
1 and 2, and the comments received thereon, the Commission finds that
the proposed rule change is consistent with the requirements of the
Act,\19\ and the rules and regulations thereunder applicable to a
national securities exchange.\20\ In particular, the Commission finds
that the proposed rule change is consistent with Section 6(b)(5) of the
Act,\21\ which requires, among other things, that the rules of a
national securities exchange be designed 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 that the rules are not designed to permit unfair discrimination
between customers, issuers, brokers, or dealers.
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\19\ 15 U.S.C. 78f.
\20\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
\21\ 15 U.S.C. 78f(b)(5).
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The Exchange's current rule governing off-floor transfers permits
such transfers to occur under specified limited circumstances. The
Exchange's proposal, among other things, adds four new scenarios in
which off-floor transfers will be permitted. According to the Exchange,
the proposed rule change ``adopts no new restrictions on off-floor
position transfers, but in fact only adopts narrowly defined,
additional circumstances under which such transfers are permissible.''
\22\
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\22\ See Cboe Response Letter, supra note 9, at 6.
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One commenter said it ``disagree[s] with the basic premises relied
upon by the CBOE for the proposal'' and believes that Cboe failed to
adequately justify the proposal.\23\ Specifically, the commenter said
it objects to the Exchange's purported prohibition on transfers
involving ``no material change of beneficial ownership,'' which the
commenter referred to as ``no change transfers,'' and believes that the
existing Rule, as well as the proposed changes thereto, are ``overly
restrictive'' because they limit off-floor ``no change'' transfers.\24\
While Cboe asserts that its proposal is codifying within its rules its
longstanding policy on off-floor transfers,\25\ the commenter
challenges that assertion and characterizes the proposal as based on
the ``erroneous current view by the CBOE that its longstanding policy''
was intended to broadly prohibit off-floor transfers where there is no
material change in beneficial ownership.\26\ The commenter instead
argues that Cboe's longstanding policy was historically intended to
require that transactions with ``material change of beneficial
ownership'' occur on an exchange and ``to direct no change transfers to
the off-floor transfer process,'' and disagrees with Cboe's assertion
that its longstanding policy was to ``generally ensure all position
movements occur in the open market.'' \27\ The commenter contends that
language in the 1995 filing that adopted of Rule 6.7 (formerly Rule
6.49A) supports its position that the rule ``was not meant to alter no
change transfers, as the open market requirement did not apply to them
in the first place.'' \28\
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\23\ See SIG December 2019 Letter, supra note 10, at 1. See also
SIG August 2019 Letter, supra note 7, at 7.
\24\ See SIG December 2019 Letter, supra note 10, at 2; SIG
August 2019 Letter, supra note 7, at 1.
\25\ See Cboe Response Letter, supra note 9, at 1.
\26\ See SIG December 2019 Letter, supra note 10, at 5, fn.15.
\27\ See SIG December 2019 Letter, supra note 10, at 3, 5; see
also SIG August 2019 Letter, supra note 7, at 7.
\28\ See SIG December 2019 Letter, supra note 10, at 3.
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Cboe disagrees with the commenter's characterization of its
longstanding policy and states that the commenter's concept of a ``no
change transfer'' that would be permitted to occur off-floor without
restriction ``conflicts with the long-standing policy and approach
reflected in the pending rule change filing.'' \29\ In support of its
position, Cboe cites, among other things, to its adoption in 1995 of
Rule 6.7 (formerly Rule 6.49A) as permitting only narrow exceptions to
the general requirement under Rule 5.12 (formerly Rule 6.49) that
transactions be effected on an exchange.\30\ Cboe states that ``[t]o be
clear, it is not, and has not been, the Exchange's intent or
interpretation of Rule 6.7 (former Rule 6.49A) that off-floor position
transfers may freely occur when there is no change in ownership (or
beneficial ownership), particularly in circumstances that result in
netting, favorable margin treatment, or repeating or recurring
transfers, or that result in the avoidance of the normal auction market
process.'' \31\ Cboe further notes that ``[n]one of the exceptions
currently delineated in Rule 6.7 permit the type of `no change'
transfer [the commenter]
[[Page 16983]]
believes is currently permissible.'' \32\ Instead, Cboe explains that
the current exceptions do not permit off-floor transactions in
situations involving ``regular business practices, such as risk
management or hedging activities'' but instead allow them in
``infrequent occurrences that arise for legal purposes (e.g., mergers,
acquisitions, bankruptcies) or other non-business related events (e.g.,
donations to not-for-profit entities, gifts to minors).'' \33\ The
Exchange points out that according to the commenter, a ```no change'
transfer may involve a change--just not a material change--in
beneficial ownership, which implies different entities (and thus
different Persons) own the accounts'' and concludes that such a
definition of ``no change transfer'' is not supported by the
commenter's argument that this is analogous to a statement comparing
different accounts of the same Person (or same entity).\34\
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\29\ See Cboe Response Letter, supra note 9, at 3.
\30\ See Cboe Response Letter, supra note 9, at 2-3.
\31\ See Cboe Response Letter, supra note 9, at 3.
\32\ See Cboe Response Letter, supra note 9, at 4.
\33\ See Cboe Response Letter, supra note 9, at 4.
\34\ See Cboe Response Letter, supra note 9, at 9.
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The Commission believes that the Exchange has addressed the
commenter's concerns concerning the scope of Rule 6.7 (formerly Rule
6.49A) and Rule 5.12 (formerly Rule 6.49). While the commenter asserts
that the Exchange ``has always generally permitted no change position
movements to be transferred off-floor,'' \35\ the Exchange contradicts
that assertion as an ``unsupported presumption'' and, in support of its
position, cites language to the contrary in its 1995 filing adopting
Rule 6.7 (formerly 6.49A).\36\ The Commission believes that the
Exchange has presented sufficient information in support of what it
considers to be its longstanding policy generally prohibiting off-
exchange transfers subject to limited exceptions.
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\35\ See SIG December 2019 Letter, supra note 10, at 5.
\36\ See Cboe Response Letter, supra note 9, at 4 and 1-2.
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Other aspects of the Exchange's proposal expand the list of
permitted off-floor transactions and purport to codify certain
preexisting Exchange interpretations concerning the nature and extent
of permitted off-floor transfers. In particular, the Exchange proposes
to add into the Rule provisions specifying that off-floor transfers may
not (1) net against another position or result in preferential margin
or haircut treatment (``netting restriction'') or (2) be used to
facilitate non-routine, non-recurring movements of positions
(``frequency restriction'').\37\
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\37\ See proposed Cboe Rule 6.7(b) and (g). While the amended
Rule will continue to allow the Exchange to grant an exemption from
Cboe Rule 5.12 to allow additional types of off-floor transfers, the
revised rule text makes it clear that such exemptions may only be
granted on rare occasions when necessary or appropriate for the
maintenance of a fair and orderly market and the protection of
investors and where the exemption is in the public interest,
including due to unusual or extraordinary circumstances.
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Commenters seek clarification on certain of these aspects of the
proposal. First, commenters ask which types of transfers would
constitute ``routine, recurring'' transfers.\38\ For example, one
commenter asks whether more than one transfer per day would be
considered ``recurring.'' \39\ In response, the Exchange states that
``[w]hat constitutes non-routine and non-recurring will be based on
facts and circumstances'' and notes that ``[t]he term `routine'
generally refers to regular or habitual actions taken as part of an
established procedure'' and ``[t]he term recurring general means
something that happens repeatedly.'' \40\ The Exchange further explains
that ``it is important that the transfer could occur only in connection
with one of the specific events/episodes listed in Rule 6.7'' and that
if a ``transfer is prescribed by a Person's procedures to occur at
specified times in intervals (such as hourly, daily, weekly, or
monthly), the Exchange would view that to be routine and recurring and
potentially be a violation of the proposed Rule requirement.'' \41\ The
Commission believes that the Exchange has addressed the commenter's
question and has articulated a reasonably and fairly implied
interpretation of how the frequency restriction would apply based on
its plain meaning.
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\38\ See Group One Letter, supra note 7, at 2; SIG August 2019
Letter, supra note 7, at 6.
\39\ See Group One Letter, supra note 7, at 2.
\40\ See Cboe Response Letter, supra note 9, at 10.
\41\ See Cboe Response Letter, supra note 9, at 10.
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In addition, one commenter argues that the proposal is ambiguous in
its description of what constitutes a separate account with respect to
proposed Rule 6.7(a)(2).\42\ Proposed Rule 6.7(a)(2) allows for off-
floor transfers involving ``the transfer of positions from one account
to another account where no change in ownership is involved (i.e.,
accounts of the same Person (as defined in Rule 1.1)), provided the
accounts are not in separate aggregation units or otherwise subject to
information barrier or account segregation requirements.'' In response,
the Exchange asserts that ``the phrases `information barriers' and
`aggregation units' are widely understood throughout the financial
industry.'' \43\ The Exchange explains the purpose behind this
restriction as follows:
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\42\ See SIG December 2019 Letter, supra note 10, at 2; SIG
August 2019 Letter, supra note 7, at 3.
\43\ See Cboe Response Letter, supra note 9, at 13.
Ultimately, these are methods used by Persons to separate
accounts for different business (e.g., to separate a market-maker
trading unit from a proprietary trading unit) or regulatory purposes
(e.g., Regulation SHO). If accounts are subject to such separation
for any such purpose, the Exchange believes it is reasonable to not
permit off-floor position transfers between such accounts that are
otherwise required to be kept separate, as such transfers could be
seen as `breaching the wall' put in place by that separation.\44\
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\44\ See Cboe Response Letter, supra note 9, at 13.
The Commission believes that the Exchange has addressed the
commenter's concern and has articulated a fair basis for the
restriction, and that such restriction is consistent with the
requirements of the Act, and the rules and regulations thereunder.
Further, both commenters generally object to the prohibitions on
netting and routine-use, and say that those prohibitions restrict their
ability to perform risk-reducing off-floor transfers.\45\ For example,
one commenter believes the rule's prohibition on repeated or routine
use is too restrictive, as it is ``unaware of any normal auction market
process that would allow for a single market participant to transact
with itself in order to move a position across two accounts maintained
by that same market participant.'' \46\ This commenter argues that
``[i]n a no-change transfer, there is no buyer and there is no
seller,'' as the positions are already owned and ownership is not
changing; therefore no-change transfers should be available ``as
frequently as necessary.'' \47\ In response, Cboe ``reiterates that
Rule 5.12 prohibits all off-floor positions transfers, unless
specifically permitted by an exception.'' \48\ The Exchange further
explains that:
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\45\ See Group One Letter, supra note 7, at 2; SIG December 2019
Letter, supra note 10, at 3, 8; SIG August 2019 Letter, supra note
7, at 6, 8.
\46\ See Group One Letter, supra note 7, at 1.
\47\ See Group One Letter, supra note 7, at 2. See also SIG
December 2019 Letter, supra note 10, at 9 (noting that pursuant to
Rule 5.12, no member ``acting as principal or agent may effect
transactions . . . '' and arguing that ``[n]o change transfers do
not reflect one's intent to buy from and sell to oneself, but simply
to move what one already holds on one's books and records for risk
management.'').
\48\ Cboe Response Letter, supra note 9, at 11.
[w]hile [the commenter] references accounts of the ``same market
participant,'' it also references a ``no change transfer'' which,
again, could result in a position transfer between accounts of
different entities (and thus different market participants) with the
same beneficial owner. The Exchange believes accounts of different
Persons, even with the same beneficial owner, could be
[[Page 16984]]
used to circumvent the normal auction process if, for example, those
accounts were being used for different trading businesses.
Therefore, the Exchange limited the proposed exception to transfers
between accounts of the same Person.\49\
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\49\ Cboe Response Letter, supra note 9, at 11.
In short, Cboe believes that the commenters seek an interpretation that
is beyond the scope of the proposed rule change.\50\
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\50\ See Cboe Response Letter, supra note 9, at 9.
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Similarly, one commenter argues that to the extent that the
proposal overly restricts off-floor transfers of positions that could
otherwise be netted for risk management purposes, the result is to
potentially harm some market makers and needlessly inflate open
interest.\51\ The commenter suggests that the proposal may force market
makers who wish to avoid the appearance of wash sales to undertake
expensive alternatives like carrying positions until expiration or
paying the spread to trade out of a position.\52\ According to the
commenter, market makers often assume unwanted positions from customer
facilitations and some market makers that do not use a ``universal
account'' nevertheless may find post-trade opportunities to hedge or
close positions, which could be more efficiently accomplished through
an off-floor transfer.\53\ The commenter states that the inability to
use off-floor transfers to reduce risk could raise a market maker's
expenses and result in wider quotes by impacted market makers that
ultimately could harm investors.\54\
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\51\ See SIG December 2019 Letter, supra note 10, at 3; SIG
August 2019 Letter, supra note 7, at 8. In addition, the commenter
stated that the prohibition on netting stemmed from concerns from
floor brokers ``troubled by apparent changes in publicly
disseminated open interest (from off-floor transferring) without the
opportunity to trade in those instances.'' See SIG December 2019
Letter, supra note 10, at 10.
\52\ See SIG December 2019 Letter, supra note 10, at 3, 10; SIG
August 2019 Letter, supra note 7, at 3-4, 6.
\53\ See SIG December 2019 Letter, supra note 10, at 8-9.
\54\ See SIG December 2019 Letter, supra note 10, at 9; SIG
August 2019 Letter, supra note 7, at 4.
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In response, the Exchange notes that is proposal ``adopts no new
restrictions on off-floor position transfers, but in fact only adopts
narrowly defined, additional circumstances under which such transfers
are permissible'' and it ``disputes the characterization of the
Proposal as creating restrictions and curtailing flexibility.'' \55\
Further, the Exchange points to other procedures that ``support and
encourage Market-Maker liquidity and foster tighter quotes,'' such as
the ``universal account'' through which ``positions in Market-Maker
subaccounts registered across multiple options exchanges automatically
transfer into a single universal account and net against other
positions in the universal account.'' \56\ Accordingly, the Exchange
asserts that ``there is in fact a cost-efficient method available for
Market-Makers to offset positions, and thus not create this perceived
harm on investors.'' \57\ The Exchange further asserts that:
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\55\ Cboe Response Letter, supra note 9, at 6.
\56\ Cboe Response Letter, supra note 9, at 7.
\57\ Cboe Response Letter, supra note 9, at 7.
The Commenters have not provided any reasoning as to why the
proposed exceptions will create new burdens that do not exist today;
they merely wish the Exchange would expand the exceptions to address
issues that the Proposal is not intended to address. The Exchange
notes again that if the Commission disapproves the Proposal,
Commenters would continue to be prohibited from effecting the ``no
change'' transfers they support.\58\
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\58\ Cboe Response Letter, supra note 9, at 9.
The Commission believes that the Exchange has addressed the
commenters' concerns. Accepting the Exchange's position that its
proposal is not designed to materially change the existing intended
scope of its off-floor transfer rule, the Commission finds that the
Exchange has articulated a reasonable explanation for its proposal and
that commenters are seeking material changes to the underlying rule
itself that are beyond the scope of its more narrowly-tailored
proposal. The current and proposed exceptions that allow certain off-
floor transfers are based on specified, limited legal situations or
one-time events, not regular business practices such as risk management
or hedging activities. As the Exchange notes, other alternatives,
including universal accounts, exist and may be utilized to avoid the
potential harms envisioned by one commenter, such as excessive risk,
wash sales, and overstating open interest. The Commission believes that
the proposed provisions, including the netting restriction and
frequency restriction, are designed to perfect the mechanism of a free
and open market and a national market system, and, in general, to
protect investors and the public interest, by assuring that off-floor
transfers are conducted in a manner consistent with the Exchange's
rules. In addition, the Commission believes that the requirement for
the parties to provide written notice to the Exchange and maintain
detailed records of each transfer will ensure that the Exchange is made
aware of off-floor transfers and is able to review them for compliance
with applicable rules.
IV. Solicitation of Comments on Amendment Nos. 1 and 2 to the Proposed
Rule Change
Interested persons are invited to submit written data, views, and
arguments concerning whether Amendment Nos. 1 and 2 are 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-CBOE-2019-035 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-CBOE-2019-035. 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-CBOE-2019-035 and should be submitted on
or before April 15, 2020.
[[Page 16985]]
V. Accelerated Approval of Proposed Rule Change, as Modified by
Amendment Nos. 1 and 2
The Commission finds good cause to approve the proposed rule
change, as modified by Amendment Nos. 1 and 2, prior to the thirtieth
day after the date of publication of notice of the filing of Amendment
Nos. 1 and 2 in the Federal Register. As discussed above, in Amendment
No. 1, the Exchange deleted from the proposed rule change its proposal
to permit RWA transfers.\59\ The Commission notes that the Exchange
subsequently refiled the RWA transfer proposal as a separate proposed
rule change filing in SR-CBOE-2019-044.\60\ Additionally, in Amendment
No. 2 the Exchange revised the proposal to update cross-references to
Cboe rules throughout the proposed rules to reflect separate amendments
it made to its rulebook in connection with the Exchange's technology
migration; relocated the proposed Rule 6.49A to Rule 6.7; and made
conforming changes to its proposed rule change to reflect the new rule
number.\61\ The Commission believes that Amendment Nos. 1 and 2 make
technical amendments to the proposed rule changes and do not raise any
novel regulatory issues. Accordingly, the Commission finds good cause,
pursuant to Section 19(b)(2) of the Act,\62\ to approve the proposed
rule change, as modified by Amendment Nos. 1 and 2, on an accelerated
basis.
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\59\ See Amendment No. 1, supra note 4.
\60\ See Amendment No. 1, supra note 4.
\61\ See Amendment No. 2, supra note 6.
\62\ 15 U.S.C. 78s(b)(2).
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VI. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\63\ that the proposed rule change (SR-CBOE-2019-035), as modified
by Amendment No. 1 and 2, be, and hereby is, approved on an accelerated
basis.
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\63\ 15 U.S.C. 78s(b)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\64\
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\64\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-06188 Filed 3-24-20; 8:45 am]
BILLING CODE 8011-01-P