[Federal Register Volume 85, Number 178 (Monday, September 14, 2020)]
[Notices]
[Pages 56661-56662]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-20127]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-89782; File No. SR-Phlx-2020-42]


Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend Rule 3304

September 8, 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 August 27, 2020, Nasdaq PHLX LLC (``Phlx'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``SEC'' or 
``Commission'') the proposed rule change as described in Items I and II 
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 proposes to amend Rule 3304 (Data Feeds Utilized) to 
add the Long-Term Stock Exchange, Inc. (``LTSE''), MIAX PEARL, LLC 
(``MIAX PEARL'') and MEMX LLC (``MEMX'') to the list of market centers 
under Rule 3304 and provide that the Exchange will utilize CQS/UQDF.
    The text of the proposed rule change is available on the Exchange's 
website at https://listingcenter.nasdaq.com/rulebook/phlx/rules, 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
    In anticipation of their planned launches \3\ the Exchange proposes 
to amend the table in Rule 3304 to include LTSE, MIAX Pearl and MEMX. 
The Exchange will use securities information processor (``SIP'') data, 
i.e., CQS SIP data, for securities reported under the Consolidated 
Quotation System and Consolidated Quotation Plan and UQDF SIP data for 
securities reported under the Nasdaq Unlisted Trading Privileges Plan 
to obtain LTSE, MIAX Pearl and MEMX quotation information for the 
handling, routing and execution of orders, as well as for the 
regulatory compliance processes related to those functions. At this 
stage, no secondary source for LTSE, MIAX Pearl or MEMX will be used.
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    \3\ LTSE plans to begin phase-in production of securities on 
August, 28, 2020. See LTSE Market Announcement available at, https://assets.ctfassets.net/cchj2z2dcfyd/rnGvgggJUplaIk6N1xNA7/41926d3925a177d6455868090c46aeda/MA-2020-020__Production_Securities_Launching_August_28_-_Google_Docs.pdf. 
MIAX Pearl Equities will begin trading in September 2020, pending 
SEC approval. See MIAX Pearl Alerts available at, https://www.miaxoptions.com/alerts/2020/02/14/miax-pearl-equities-exchange-codes-and-important-dates-regarding-launch-new. MEMX is expected to 
launch on September 4, 2020. See MEMX Update from Jonathan Kellner, 
dated June 11, 2020, available at https://memx.com/memx-update/.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\4\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\5\ in particular, in that it is designed to promote 
just and equitable principles of

[[Page 56662]]

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.
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    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that the proposed rule change removes 
impediments to and perfects the mechanism of a free and open market 
because adding LTSE, MIAX Pearl and MEMX because updating its list of 
market centers for which the Exchange consumes quotation data will 
provide clarity to market participants. Moreover, it is necessary and 
consistent with the public interest and the protection of investors to 
update the Exchange's table of market centers in order to provide 
transparency with respect to all the direct proprietary and network 
processor feeds from which the Exchange obtains market data. 
Additionally, a similar change has been proposed by other exchanges.\6\
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    \6\ See Securities Exchange Act Release Nos. 88313 (March 3, 
2020), 85 FR 13684 (March 9, 2020) (SR-IEX-2020-03); 88587 (April 8, 
2020), 85 FR 20794 (April 14, 2020) (SR-NASDAQ-2020-015); 88601 
(April 8, 2020), 85 FR 20798 (April 14, 2020) (NYSE-2020-31); 88604 
(April 8, 2020), 85 FR 20741 (April 14, 2020) (SR-NYSECHX-2020-12); 
88610 (April 9, 2020), 85 FR 21033 (April 15, 2020) (SR-NYSEARCA-
2020-30); 88611 (April 9, 2020), 85 FR 21047 (April 15, 20205) (SR-
NYSENAT-2020-15); 89382 (July 23, 2020), 85 FR 45719 (July 29, 2020) 
(SR-NYSECHX-2020-22); 89369 (July 21, 2020), 85 FR 45270 (July 27, 
2020) (SR-NYSE-2020-60); 89387 (July 23, 2020), 85 FR 45722 (July 
29, 2020) (SR-NYSEARCA-2020-67); 89388 (July 23, 2020), 85 FR 45711 
(July 29, 2020) (SR-NYSENAT-2020-23); 89580 (August 17, 2020), 85 FR 
51828 (August 21, 2020) (SR-IEX-2020-11).
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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. The proposed rule change is not 
designed to address any competitive issue; instead, its purpose is to 
enhance transparency with respect to the operation of the Exchange and 
its use of market data feeds.

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

    Because the foregoing 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 \7\ and Rule 19b-
4(f)(6) thereunder.\8\
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and 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. 
The Exchange has satisfied this requirement.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \9\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \10\ permits the 
Commission to designate a shorter time if such action is consistent 
with the protection of investors and the public interest. The Exchange 
has requested that the Commission waive the 30-day operative delay. 
Waiver of the operative delay would allow the Exchange to disclose the 
updated list of market centers for which the Exchange consumes 
quotation data, and the source of the quotation data, at the time that 
LTSE, MIAX Pearl, and MEMX become operational. The Commission believes 
that waiving the 30-day operative delay is consistent with the 
protection of investors and the public interest. Accordingly, the 
Commission waives the 30-day operative delay and designates the 
proposed rule change as operative upon filing.\11\
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    \9\ 17 CFR 240.19b-4(f)(6).
    \10\ 17 CFR 240.19b-4(f)(6)(iii).
    \11\ For purposes only of waiving the 30-day operative delay, 
the Commission also has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    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.

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-2020-42 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-2020-42. 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-2020-42 and should be submitted on 
or before October 5, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-20127 Filed 9-11-20; 8:45 am]
BILLING CODE 8011-01-P