[Federal Register Volume 85, Number 62 (Tuesday, March 31, 2020)]
[Notices]
[Pages 17925-17927]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-06609]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-88475; File No. SR-CBOE-2020-018]


Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Update 
the Silexx Fee Schedule

March 25, 2020.
    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 March 13, 2020, Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe 
Options'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the Exchange.

[[Page 17926]]

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 a rule change to include language within the 
Silexx Fees Schedule to introduce a free upgrade for users on Silexx 
Basic to Silexx Pro from March 13, 2020 through April 30, 2020.
    The text of the proposed rule change is also available on the 
Exchange's website (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this filing is to include language within the Silexx 
Fees Schedule to introduce a free upgrade for users on Silexx Basic to 
Silexx Pro from March 13, 2020 through April 30, 2020.
    By way of background, the Silexx platform consists of a ``front-
end'' order entry and management trading platform (also referred to as 
the ``Silexx terminal'') for listed stocks and options that supports 
both simple and complex orders,\3\ and a ``back-end'' platform which 
provides a connection to the infrastructure network. From the Silexx 
platform (i.e., the collective front-end and back-end platform), a 
Silexx user has the capability to send option orders to U.S. options 
exchanges, send stock orders to U.S. stock exchanges (and other trading 
centers), input parameters to control the size, timing, and other 
variables of their trades, and also includes access to real-time 
options and stock market data, as well as access to certain historical 
data. The Silexx platform is designed so that a user may enter orders 
into the platform to send to an executing broker (including Trading 
Permit Holders (``TPHs'')) of its choice with connectivity to the 
platform, which broker will then send the orders to Cboe Options (if 
the broker is a TPH) or other U.S. exchanges (and trading centers) in 
accordance with the user's instructions.\4\ The Silexx front-end and 
back-end platforms are a software application that are installed 
locally on a user's desktop. Silexx grants users licenses to use the 
platform, and a firm or individual does not need to be a TPH to license 
the platform. Use of Silexx is completely optional.
---------------------------------------------------------------------------

    \3\ The platform also permits users to submit orders for 
commodity futures, commodity options and other non-security products 
to be sent to designated contract markets, futures commission 
merchants, introducing brokers or other applicable destinations of 
the users' choice.
    \4\ Silexx does not allow users to send orders directly to the 
Exchange or other market centers; however, an additional version of 
the Silexx platform, Silexx FLEX, supports the trading of FLEX 
Options and allows authorized Users with direct access to the 
Exchange. See Securities Exchange Act Release No. 87028 (September 
19, 2019) 84 FR 50529 (September 25, 2019) (SR-CBOE-2019-061).
---------------------------------------------------------------------------

Free Upgrade
    Silexx Basic is an order-entry and management system that provides 
basic functionality including real-time data, alerts, trade reports, 
views of exchange books, management of the customer's orders and 
positions, simple and complex order tickets, and basic risk features. 
Users are currently charged $200 per month per Login ID for Silexx 
Basic. Silexx Pro offers the same functionality as the basic platform 
plus additional features including an algorithmic order ticket, 
position analysis, charting, earnings and dividend information, delta 
hedging tools, volatility skews, and additional risk features. Users 
are currently charged $400 per month per Login ID for Silexx Pro.
    The Exchange proposes to introduce a free-upgrade period for users 
that are currently on Silexx Basic. This upgrade would allow users of 
Silexx Basic to use the functionality of Silexx Pro from March 13, 2020 
through April 30, 2020) at the current Silexx Basic rate of $200 per 
month per Login ID. After this period ends, beginning May 1, 2020, 
those users who upgraded will be charged at the Silexx Pro rate of $400 
per month until they choose to downgrade. The Exchange notes that the 
upgrade to Silexx Pro is optional.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations thereunder applicable to the Exchange and, in particular, 
the requirements of Section 6(b) of the Act.\5\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \6\ requirements that the rules of an exchange be 
designed to prevent fraudulent and manipulative acts and practices, to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in regulating, clearing, 
settling, processing information with respect to, and facilitating 
transactions in securities, 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. Additionally, 
the Exchange believes the proposed rule change is consistent with 
Section 6(b)(4) of the Act,\7\ which requires that Exchange rules 
provide for the equitable allocation of reasonable dues, fees, and 
other charges among its Trading Permit Holders and other persons using 
its facilities.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
    \7\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

    In particularly, the Exchange believes the proposed is reasonable, 
equitable, and not unfairly discriminatory because the free upgrade 
will apply to all current users of Silexx Basic who wish to upgrade. 
Additionally, the free upgrade period will be limited through April 30, 
2020. Finally, the Exchange notes that use of the platform, including 
the upgrade, is discretionary and not compulsory, and users may 
downgrade or cancel their Login IDs with Silexx at any time.

B. Self-Regulatory Organization's Statement on Burden on Competition

    Cboe Options does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. The Exchange believes that 
the proposed rule change will not impose any burden on intramarket 
competition because the proposed rule changes apply to all users of 
Silexx. The Exchange notes that each version of Silexx is available to 
all market participants, and users have discretion to determine which 
version of the platform they register for based on functionality.
    The Exchange does not believe that the proposed rule changes will 
impose

[[Page 17927]]

any burden on intermarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act because the 
proposed change applies only to Cboe Options. To the extent that the 
proposed changes make Cboe Options a more attractive marketplace for 
market participants at other exchanges, such market participants are 
welcome to become Cboe Options market participants.

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

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

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \8\ and paragraph (f) of Rule 19b-4 \9\ 
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 will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

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-CBOE-2020-018 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-2020-018. 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-2020-018 and should be submitted on 
or before April 21, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-06609 Filed 3-30-20; 8:45 am]
BILLING CODE 8011-01-P