[Federal Register Volume 85, Number 152 (Thursday, August 6, 2020)]
[Notices]
[Pages 47819-47821]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17130]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-89437; File No. SR-BOX-2020-30]


Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Make a Number 
of Non-Substantive Changes to the Rulebook

July 31, 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 July 22, 2020, BOX Exchange LLC (the ``Exchange'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I and II below, which Items have been 
prepared by the self-regulatory organization. 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 the 
Substance of the Proposed Rule Change

    The Exchange proposes to make a number of non-substantive changes 
to the rulebook. The text of the proposed rule change is available from 
the principal office of the Exchange, at the Commission's Public 
Reference Room and also on the Exchange's internet website at http://boxoptions.com.

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 self-regulatory organization 
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 self-regulatory organization 
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 make a number of non-
substantive changes to the rulebook. The Exchange believes these 
changes

[[Page 47820]]

are necessary to correct inadvertent oversights to internal cross-
references and other minor changes of a non-substantive nature in order 
to provide greater accuracy and clarity to the rulebook.
    First, the Exchange is proposing to amend the BOX Rule 7110 (Order 
Entry). Specifically, the Exchange is proposing to remove the language 
``and strategies'' in order to clarify that no complex orders will be 
accepted by the system during the pre-opening period.\3\ The Exchange 
discovered the inadvertent inclusion during compliance testing of the 
rulebook and now seeks to amend the rule language to match how the BOX 
trading system currently functions.
---------------------------------------------------------------------------

    \3\ See BOX Rule 7070(a).
---------------------------------------------------------------------------

    Next, the Exchange proposes to correct two internal cross 
references contained in the Exchange's rulebook. Specifically, within 
BOX Rule 7600(a)(4), the internal cross reference to the defined term 
Complex Orders must be updated from Rule 7240(a)(5) to Rule 7240(a)(7). 
Similarly, in Rule IM-8050-3, the internal cross-reference to Rule 
100(a)(55) must be updated to Rule 100(a)(56).\4\ The Exchange believes 
that these non-substantive changes will enhance the accuracy of the 
Exchange's rules.
---------------------------------------------------------------------------

    \4\ BOX Rule 100(a)(56) defines ``quote'' or ``quotation'' as a 
bid or offer entered by a Market Maker as a firm order that updates 
the Market Maker's previous bid or offer, if any.
---------------------------------------------------------------------------

    Lastly, the Exchange previously submitted a rule filing noticed by 
the Commission for immediate effectiveness, where the Exchange proposed 
to make a number of non-substantive changes to the rulebook, including 
replacing the term ``Options Participant'' with ``Participant.'' \5\ 
The rule proposal specified that certain Exchange rules were not 
options specific and therefore the Exchange deemed it appropriate to 
replace ``Options Participant'' with ``Participant'' to provide more 
general coverage. The proposed change was intended to clarify that the 
Exchange rules applied to Participants of the Exchange regardless of 
whether they participated in the trading of options. In doing so, the 
Exchange inadvertently overlooked additional references within the 
following paragraphs, which should have also been updated. The Exchange 
now proposes to amend these rules as it relates to the usage of the 
term ``Options Participant'' as follows:
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 83895 (August 21, 
2018), 83 FR 43711 (August 27, 2018) (Notice of Filing and Immediate 
Effectiveness of SR-BOX-2018-27).
---------------------------------------------------------------------------

     The Exchange proposes to replace ``Options Participant'' 
with ``Participant'' in Rule 10050(c) (Regulatory Cooperation), which 
details right of the Exchange to collect testimony and additional 
documentation in connection with investigations or disciplinary 
proceedings.
     The Exchange also proposes to replace ``Options 
Participant'' with ``Participant'' in Rule 12030(a)(1) (Letters of 
Consent) which outlines when the Exchange may dispose of a matter 
concerning violative conduct, pursuant to a letter of consent, in place 
of normal disciplinary procedures.
     Lastly, the Exchange also proposes to replace ``Options 
Participant'' with ``Participant'' in Rule 14000(b) which covers 
jurisdictional scope of disputes as it relates to Exchange 
arbitration.\6\
---------------------------------------------------------------------------

    \6\ The Exchange notes that in paragraph 14000(b) the Exchange 
is also proposing to delete duplicative text ``except that'', and 
correct a spelling error by changing ``statue'' to ``statute'' in 
the rule text.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act,\7\ in general, and Section 
6(b)(5) of the Act,\8\ in particular, in that it is designed to prevent 
fraudulent and manipulative acts and practices, to promote just and 
equitable principles of trade, to foster cooperation and coordination 
with persons engaged in 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.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change would remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system by ensuring that market participants can 
easily navigate, understand and comply with the Exchange's rulebook. 
The Exchange believes that the proposed rule change enables the 
Exchange to continue to enforce the Exchange's rules. The Exchange 
believes that none of the proposed changes discussed herein alter the 
application of any rules, or how the trading system currently 
functions. As such, the proposed amendments would foster cooperation 
and coordination with persons engaged in facilitating transactions in 
securities and would remove impediments to and perfect the mechanism of 
a free and open market and a national exchange system. Further, the 
Exchange believes that, by ensuring the rulebook accurately reflects 
the intention of the Exchange's rules, the proposed rule change reduces 
potential investor or market participant confusion.

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. In this regard and as indicated 
above, the Exchange notes that the proposed changes will not alter the 
substance or application of any of the Exchange's rules. Therefore, the 
proposed changes will have no impact on competition as they are not 
designed to address any competitive issues but rather are designed to 
make clarifying, non-substantive changes.

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

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

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

    Because the proposed rule change does not (i) significantly affect 
the protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative for 30 
days from the date on which it was filed, or such shorter time as the 
Commission may designate, it has become effective pursuant to Section 
19(b)(3)(A) of the Act \9\ and Rule 19b-4(f)(6) thereunder.\10\
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written 
notice of its intent to file the proposed rule change, along with a 
brief description and the text of the proposed rule change, at least 
five business days prior to the date of filing of the proposed rule 
change, or such shorter time as designated by the Commission.
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.

[[Page 47821]]

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-BOX-2020-30 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-BOX-2020-30. 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 such 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-BOX-2020-30, and should be submitted on 
or before August 27, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-17130 Filed 8-5-20; 8:45 am]
BILLING CODE 8011-01-P