[Federal Register Volume 86, Number 73 (Monday, April 19, 2021)]
[Notices]
[Pages 20426-20428]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-07959]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-91542; File No. SR-MIAX-2021-09]


Self-Regulatory Organizations; Miami International Securities 
Exchange, LLC; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend Exchange Rule 1801, Definitions and 
Exchange Rule 1809, Terms of Index Options Contracts

April 13, 2021.
    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 30, 2021, Miami International Securities Exchange, LLC 
(``MIAX Options'' or the ``Exchange'') filed with the Securities and 
Exchange Commission (the ``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 Substance 
of the Proposed Rule Change

    The Exchange is filing a proposal to amend Interpretation and 
Policy .01 to Exchange Rule 1801 and Exchange Rules 1809(a)(3)-(5), to 
amend the names of certain indexes on which the Exchange may list and 
trade options due to rebranding, and to update the reporting authority 
for those indexes.\3\
---------------------------------------------------------------------------

    \3\ On April 16, 2020, the Exchange filed a Form 19b-4(e) with 
the Commission pursuant to Rule 19b-4(e) of the Act for the AF CRE 
Indexes (defined below). The Exchange has not yet listed options for 
trading on the AF CRE Indexes for business reasons. The Exchange 
notes that it will file a Form 19b-4(e) with the Commission pursuant 
to Rule 19b-4(e) of the Act for the BRIXX Indexes (defined below) at 
the time the Exchange anticipates it will begin listing options for 
trading on the BRIXX Indexes.
---------------------------------------------------------------------------

    The text of the proposed rule change is available on the Exchange's 
website at http://www.miaxoptions.com/rule-filings/ at MIAX Options' 
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 Interpretation and Policy .01 to 
Exchange Rule 1801 and Exchange Rule 1809(a)(3)-(5), to amend the names 
of certain indexes on which the Exchange may list and trade options due 
to a rebranding of those index names, and to update the reporting 
authority for those indexes.
    The Exchange first proposes to amend Exchange Rule 1801, 
Interpretation and Policy .01, to amend the names of the Advanced 
Fundamentals LLC (``Advanced Fundamentals'') Commercial Real Estate 
Indexes (the ``AF CRE Indexes''), on which the Exchange may list 
options, due to the Exchange rebranding the AF CRE Indexes under new 
names. The Exchange also proposes to update the reporting authority 
service provider for the newly rebranded indexes.
    On April 17, 2020, the Exchange filed its proposal with the 
Commission to amend certain of the Exchange's rules in connection with 
the Exchange's plan to list and trade options on five AF CRE Indexes--
the AF CRE Residential Index, AF CRE Retail Index, AF CRE Office Index, 
AF CRE Hospitality Index and AF CRE Composite Index.\4\ The AF CRE 
Indexes measure real-time real estate returns representing the 
performance of real estate investment trusts (``REITs'') and/or 
publicly listed equity companies across various sectors. Each 
constituent of an AF CRE Index is a REIT or equity company listed on a 
U.S. securities exchange. The individual components of each AF CRE 
Sector Index are determined from the REITs/equity companies that have 
the largest enterprise value (``Enterprise Value'') \5\ within each 
individual sector and that meet certain minimum eligibility 
requirements. Since the publication of the AF CRE Index Notice and to 
date, the Exchange has not listed options for trading on the AF CRE 
Indexes (or options on the rebranded products, the BRIXX Indexes, 
described below), for business reasons.
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 88767 (April 29, 
2020), 85 FR 26743 (May 5, 2020) (SR-MIAX-2020-08) (Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change to List and 
Trade Options That Overlie Five Advanced Fundamentals LLC Commercial 
Real Estate Indexes) (the ``AF CRE Index Notice'').
    \5\ The term ``Enterprise Value'' refers to the measure of a 
company's total value, calculated by adding the company's market 
capitalization, total liabilities and preferred equity, then 
subtracting all cash and cash equivalents. See https://www.investopedia.com/terms/e/enterprisevalue.asp.
---------------------------------------------------------------------------

    Recently, the Exchange rebranded the AF CRE Indexes as the 
BRIXX\TM\ Commercial Real Estate Indexes (the ``BRIXX Indexes''), as 
follows: (1) The AF CRE Office Index is rebranded as the BRIXX Office 
Index; (2) the AF CRE Retail Index is rebranded as the BRIXX Retail 
Index; (3) the AF CRE Residential Index is rebranded as the BRIXX 
Residential Index; (4) the AF CRE Hospitality Index is rebranded as the 
BRIXX Hospitality Index; and (5) the AF CRE Composite Index is 
rebranded as the BRIXX Composite Index. Accordingly, the Exchange 
proposes to amend the table of indexes in Exchange Rule 1801, 
Interpretation and Policy .01, to insert each of the rebranded BRIXX 
Indexes in place of the AF CRE Indexes under the heading ``Underlying 
Index.''
    The Exchange also proposes to amend Exchange Rule 1801, 
Interpretation and Policy .01, to update the reporting authority \6\ 
for each of the BRIXX Indexes. The reporting authority in respect of a 
particular index means the institution or reporting service designated 
by the Exchange as the official source for calculating the level of the 
index from the reporting prices of the underlying securities that are 
the basis of the index and reporting such level.\7\ At the time of the 
AF CRE Index Notice, Refinitiv was listed as the reporting authority 
for each of the AF CRE Indexes (now known as the BRIXX Indexes).\8\ 
Refinitiv still monitors and

[[Page 20427]]

maintains each of the BRIXX Indexes and rebalances each of the BRIXX 
Indexes quarterly.\9\
---------------------------------------------------------------------------

    \6\ See Exchange Rule 1801(p).
    \7\ See id.
    \8\ Refinitiv is currently the reporting authority for each of 
the BRIXX Indexes (formerly, the AF CRE Indexes). See Exchange Rule 
1801, Interpretation and Policy .01. Thomson Reuters' Financial & 
Risk (``F&R'') business unit was rebranded under the name 
``Refinitiv'' in 2018 when Thomson Reuters sold a majority stake in 
its F&R business unit to private equity firm Blackstone Group LP. 
Refinitiv provides financial markets data and infrastructure in over 
150 countries. Part of Refinitiv's services include, but are not 
limited to, the calculation of various indexes. See Thomson Reuters 
Financial & Risk Business Announces New Company Name: Refinitiv 
(July 27, 2018), available at https://www.thomsonreuters.com/en/press-releases/2018/july/thomson-reuters-financial-and-risk-business-announces-new-company-name-refinitiv.html.
    \9\ See supra note 4.
---------------------------------------------------------------------------

    The Exchange does not currently list options for trading on the 
BRIXX Indexes (and has not listed options for trading under the 
previously named AF CRE Indexes). Recently, the Exchange determined to 
switch reporting authority service providers for the BRIXX Indexes from 
Refinitiv to Devexperts Inc. (``Devexperts'').\10\ The Exchange 
proposes to announce when the transfer in reporting authority service 
provider from Refinitiv to Devexperts is complete by Regulatory 
Circular. As a result, the Exchange designates Devexperts as the 
reporting authority for each of the BRIXX Indexes, and proposes to 
amend the table in Interpretation and Policy .01 to Exchange Rule 1801 
to reflect such changes under the heading ``Reporting Authority.'' \11\ 
The Exchange represents that this change will have no impact on the 
accuracy and dissemination of index values for any of the BRIXX 
Indexes. Values for the BRIXX Indexes will continue to be disseminated 
and available to market participants in the same manner and in the same 
intervals.\12\
---------------------------------------------------------------------------

    \10\ Devexperts provides consulting and software development 
services for the financial industry, including calculation and 
reporting services, on-line and desktop trading execution platforms, 
risk management and fix gateways, and real-time and historical data 
services. See https://devexperts.com/about-devexperts/.
    \11\ The Exchange notes that, for business reasons, it acts as 
the reporting authority for the SPIKES Volatility Index, on which 
the Exchange currently lists options, instead of a third-party 
service provider. See Exchange Rule 1801, Interpretation and Policy 
.01.
    \12\ Pursuant to Exchange Rules 1802(b)(10) and (d)(11), the 
current value of an index must be disseminated at least once every 
15 seconds by one or more major market data vendors. The Exchange 
represents that this will continue to be the case for the AF CRE 
Indexes.
---------------------------------------------------------------------------

    Next, the Exchange proposes to amend Exchange Rules 1809(a)(3)-(5) 
to update the names of the AF CRE Indexes to be rebranded as the BRIXX 
Indexes, as described above. The AF CRE Index Notice provided that, 
pursuant to Exchange Rules 1809(a)(3)-(5), the Exchange would be able 
to list up to twelve (12) standard monthly expirations on the AF CRE 
Indexes, the AF CRE Indexes would be European-style index options, and 
the AF CRE Indexes would be A.M-settled.\13\ The Exchange proposes to 
amend Exchange Rules 1809(a)(3)-(5) to reflect the name change of the 
AF CRE Indexes to the BRIXX Indexes. Accordingly, with the proposed 
changes, Exchange Rules 1809(a)(3)-(5) will provide that the Exchange 
is able to list up to twelve (12) standard monthly expirations on the 
BRIXX Indexes, the BRIXX Indexes are European-style index options, and 
the BRIXX Indexes are A.M-settled.
---------------------------------------------------------------------------

    \13\ See Exchange Rules 1809(a)(3)-(5).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\14\ Specifically, the Exchange believes the proposed rule change 
is consistent with the Section 6(b)(5) \15\ 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 the Section 6(b)(5) \16\ requirement that the rules of 
an exchange not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \14\ 15 U.S.C. 78f(b).
    \15\ 15 U.S.C. 78f(b)(5).
    \16\ Id.
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule changes remove 
impediments to and perfects the mechanism of a free and open market a 
national market system, and protects investors and the public interest 
by updating the Exchange's rules to reflect the rebranded names of 
certain indexes on which the is authorized to list and trade options, 
as well as to update the reporting authority service provider for the 
BRIXX Indexes. The Exchange believes this promotes transparency in its 
rules and may eliminate any potential confusion among market 
participants. The proposed rule changes will have no impact on the 
dissemination of index values of the BRIXX Indexes, but merely reflects 
a rebranding of the products and a change in the reporting authority 
service provider for the various indexes on which the Exchange is 
authorized to list options, due to business reasons. The Exchange 
believes this proposal perfects the mechanism of a free and open market 
a national market system, and protects investors and the public 
interest because, with the proposed rebrand from the AF CRE Indexes to 
the BRIXX Indexes, there will be no change to the initial or 
maintenance listing criteria, expiration months, settlement or exercise 
style of options on the BRIXX Indexes. The Exchange notes that this 
proposal is simply to clarify the rebranded name of the index options 
products.
    The Exchange believes that the proposed change in reporting 
authority service provider removes impediments to and perfects the 
mechanism of a free and open market a national market system, and 
protects investors and the public interest because this change will 
have no impact on the accuracy and dissemination of index values for 
any of the BRIXX Indexes. Values for the BRIXX Indexes will continue to 
be disseminated and available to market participants in the same manner 
and in the same intervals. The Exchange notes that it has not listed 
options on the AF CRE Indexes (or options on the rebranded products, 
the BRIXX Indexes) at this time.

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 that is not necessary or appropriate 
in furtherance of the purposes of the Act. The proposed rule change is 
not intended to be a competitive rule filing. Rather, the proposed rule 
change merely reflects a change to the name of the index options and 
the reporting authority service provider for the various indexes on 
which the Exchange is authorized to list options due to business 
reasons. The proposed rule change has no impact on the dissemination of 
index values for the BRIXX Indexes. Further, the Exchange has not yet 
listed options for trading on the BRIXX Indexes.

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.

[[Page 20428]]

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 after the date of the filing, or such 
shorter time as the Commission may designate, it has become effective 
pursuant to Section 19(b)(3)(A) of the Act \17\ and Rule 19b-4(f)(6) 
\18\ thereunder.
---------------------------------------------------------------------------

    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file 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.
---------------------------------------------------------------------------

    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.

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-2021-09 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-2021-09. 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-2021-09 and should be submitted on 
or before May 10, 2021.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\19\
---------------------------------------------------------------------------

    \19\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-07959 Filed 4-16-21; 8:45 am]
BILLING CODE 8011-01-P