[Federal Register Volume 89, Number 14 (Monday, January 22, 2024)]
[Notices]
[Pages 3963-3968]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-01071]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-99345; File No. 4-820]


Options Price Reporting Authority; Notice of Filing of Proposed 
Amendment To Modify Section 5.2(c)(iii) of the OPRA Plan Relating to 
Dissemination of Exchange Proprietary Data Information

January 16, 2024.
    Pursuant to section 11A of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 608 thereunder,\2\ notice is hereby given that 
on November 8, 2023,\3\ the Cboe BZX Exchange, Inc. (``BZX Options''), 
Cboe Exchange, Inc. (``Cboe Options''), Cboe C2 Exchange, Inc. (``C2 
Options'') and Cboe EDGX Exchange, Inc. (``EDGX Options'') 
(collectively, the ``Sponsors'' or ``Cboe'') filed with the Securities 
and Exchange Commission (``Commission'') a proposed amendment to the 
Plan for Reporting of Consolidated Options Last Sale Reports and 
Quotation Information (``OPRA Plan'').\4\
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    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 242.608.
    \3\ See Letter from Corrine Klott, Cboe, to Vanessa A. 
Countryman, Commission (Nov. 8, 2023) (``Transmittal Letter'').
    \4\ The OPRA Plan is a national market system plan approved by 
the Commission pursuant to Section 11A of the Act and Rule 608 
thereunder. See Securities Exchange Act Release No. 17638 (Mar. 18, 
1981), 22 SEC. Docket 484 (Mar. 31, 1981). The full text of the OPRA 
Plan and a list of its participants are available at https://www.opraplan.com/. The OPRA Plan provides for the collection and 
dissemination of last sale and quotation information on options that 
are traded on the participant exchanges.
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    The Sponsors state that they have filed the Amendment pursuant to 
Rule 608(a)(1) under Regulation NMS.\5\ Rule 608(a)(1) provides:
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    \5\ 17 CFR 242.608(a)(1).

    Any two or more self-regulatory organizations, acting jointly, . 
. . may propose an amendment to an effective national market system 
plan (``proposed amendment'') by submitting the text of the . . . 
amendment to the Commission by email, together with a statement of 
the purpose of such . . . amendment and, to the extent applicable, 
the documents and information required by paragraphs (a)(4) and (5) 
of this section.\6\
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    \6\ Id.

Section 10.3 (Amendments) of the OPRA Plan, by contrast, provides that 
the plan ``may be amended from time to time when authorized by the 
affirmative vote of all of the Members, subject to the approval of the 
Securities and Exchange Commission,'' \7\ and the affirmative vote of 
all of the Members of the OPRA Plan has not been obtained on the 
proposed amendment.
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    \7\ See Limited Liability Company Agreement of Options Price 
Reporting Authority, LLC, Art X, sec. 10.3.
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    The Commission is publishing this notice to solicit comments from 
interested persons on the proposed Amendment. Set forth below in 
Section I, which is being published verbatim as filed by the Sponsors, 
is the statement of the purpose and summary of the Amendment, along 
with information pursuant to Rule 608(a) under the Act.\8\
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    \8\ 17 CFR 242.801(a).

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[[Page 3964]]

I. Requirements Pursuant to Rule 608(a)

1. Statement of Purpose

Executive Summary
    Access to high-quality, real-time market data is essential for 
participation in the financial markets. For this reason, market 
participants, regulators, and data providers are constantly working to 
strike a balance between data quality and data expense. Cboe proposes 
to amend the OPRA Plan in a manner in which it believes will better 
enable all OPRA Members to expand the amount of proprietary data 
available to users and consumers of such data, as well as spur 
innovation and competition for market data. In particular, Cboe 
believes that the proposed amendments would result in broadening the 
availability of U.S. option market data to investors consistent with 
the principles of Regulation NMS. The proposed amendment also will 
promote transparency by facilitating the dissemination of market data 
more widely through additional distribution channels, which will enable 
investors to better monitor trading activity on the U.S. options 
exchanges, support more informed trading and investment decisions, and 
thereby serve the public interest. To be clear, Cboe firmly believes 
that these amendments are simply clarifications of what the plain text 
of the OPRA Plan currently says. But in light of disagreement over the 
meaning of the current plan, Cboe seeks to make explicit the meaning of 
the OPRA Plan.
    In particular, the Exchange proposes to amend Section 5.2(c)(iii) 
of the OPRA Plan (``Equivalent Access Provision'') which currently 
provides that:

    (iii) A Member may disseminate its Proprietary Information 
pursuant to subparagraph (ii) of this paragraph (c) provided that:
    (A) such dissemination is limited to other Members and to 
persons who also have equivalent access to consolidated Options 
Information disseminated by OPRA for the same classes or series of 
options that are included in the Proprietary Information. For 
purposes of this clause (A), ``consolidated Options Information'' 
means consolidated Last Sale Reports combined with either 
consolidated Quotation Information or the BBO furnished by OPRA, and 
access to consolidated Options Information and access to Proprietary 
Information are deemed ``equivalent'' if both kinds of information 
are equally accessible on the same terminal or work station; and
    (B) a Member may not disseminate its Proprietary Information on 
any more timely basis than the same information is furnished to the 
OPRA System for inclusion in OPRA's consolidated dissemination of 
Options Information.
Background
    On July 20, 2001, the Commission approved an amendment to the OPRA 
Plan which allowed exchanges to provide proprietary data to their 
members under certain conditions, including a requirement that members 
have ``equivalent access'' to consolidated options information.\9\ 
Prior to that amendment, OPRA was the exclusive provider of information 
regarding options quotes and transactions.\10\ The Commission noted 
that the proposed amendments to the OPRA Plan (i.e., adoption of the 
Equivalent Access Provision) were intended to improve competition.\11\ 
On November 21, 2003, the SEC approved amendments to a number of 
provisions of the OPRA Plan, including an amendment expanding the scope 
of who could receive proprietary data to include other ``persons'' in 
addition to exchange members.\12\ Non-substantive changes were made to 
Section 5.2(c)(iii) when OPRA was reorganized as a limited liability 
company effective on January 1, 2010, but the substance of the 
Equivalent Access Provision has otherwise been unchanged since 2003.
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    \9\ See Securities Exchange Act Release No. 44580 (July 20, 
2001), 66 FR 39218 (July 27, 2001) (SR-OPRA-2001-02).
    \10\ In 2000 and 2001, the Commission granted ISE and Cboe 
Options temporary exemptions from the exclusivity requirement. Those 
exemptions were granted pursuant to Exchange Act Rule 11Aa3-2(f), 17 
CFR 240.11Aa3-2(f). See letters from Robert L.D. Colby, Deputy 
Director, Division of Market Regulation, Commission, to Michael J. 
Simon, Senior Vice President and General Counsel, ISE, dated May 25, 
2000 and to Edward J. Joyce, President and Chief Executive Officer, 
CBOE, dated November 6, 2000. These letters, originally drafted to 
expire on May 26, 2001, were extended until September 1, 2002. See 
letters from Robert L.D. Colby, Deputy Director, Division of Market 
Regulation, Commission, to Michael J. Simon, Senior Vice President 
and General Counsel, ISE, dated May 24, 2001 and to Edward J. Joyce, 
President and Chief Executive Officer, CBOE, dated May 24, 2001.
    \11\ Supra note [9].
    \12\ See OPRA; Notice of Filing and Order Approving on a 
Temporary Basis not to Exceed 120 Days a Proposed Amendment to the 
Plan for Reporting of Consol. Options Last Sale Info. and Amendments 
No. 1 and 2 Thereto to Revise the Manner in Which the OPRA Engages 
in Capacity Planning and Allocates its Available Systems Capacity 
Among the Parties to the Plan, Release No. 34-48822, 2003 WL 
22767596[.]
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    Cboe believes that, based on its plain language, subparagraph (A) 
of the Equivalent Access Provision is satisfied where a recipient of an 
exchange proprietary data product also is simultaneously authorized and 
entitled to receive OPRA data in one of the ways that OPRA makes its 
data available; that is, by maintaining a streaming subscription to the 
OPRA feed or having the ability to query OPRA data on a usage-
basis,\13\ thereby preserving the Commission's intent to improve 
competition through the 2001 amendments to the OPRA Plan.
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    \13\ The ``Basic Service'' ``quote packets'' or ``options 
chains'' made available by OPRA pursuant to the ``Usage-based Vendor 
Fee'' option in OPRA's Fee Schedule meet the definition of 
``consolidated Options Information.'' That ``Basic Service'' 
includes ``all last sale and quotations information pertaining to 
equity options and index options, including foreign currency index 
options.'' See OPRA Fee Schedule at 1 and n.1. In addition, the Fee 
Schedule also states that a ``quote packet'' supplied in response to 
a usage-based query ``consists of any one or more of the following 
values: last sale, bid/ask, and related market data for a single 
series of options or a related index'' and that an ``options chain'' 
supplied in response to a usage-based query ``consists of last sale, 
bid/ask, and related market data for up to all series of put and 
call options on the same underlying security or index.'' Therefore, 
a person who has access to OPRA's usage-based data service on his or 
her terminal or work station and can obtain quote packets and 
options chains has, by definition, equivalent access to 
``consolidated Options Information'' because that person will have 
access to ``Last Sale Reports,'' ``Quotation Information,'' and the 
``BBO.''
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    Cboe strongly believes there are several bases that support its 
reading of the current subparagraph (A) of the Equivalent Access 
Provision including: the plain reading and unambiguous nature of the 
language in Equivalent Access Provision; the nature of the current OPRA 
audit protocols to ensure compliance with Equivalent Access Provision; 
the language (or lack thereof) included in OPRA market data agreements, 
policies and fees schedules relating to Equivalent Access and public 
representations made by other OPRA members since the adoption of the 
provision in 2001 that are inconsistent with a requirement that a 
person receiving a proprietary data feed also receive streaming real-
time data from OPRA.\14\
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    \14\ See Securities Exchange Act Release No. 32675 (June 30, 
2009), 74 FR 32675 (July 8, 2009) (SR-Phlx-2009-54), in which Nasdaq 
PHLX, LLC (``PHLX'') states: ``[T]he TOPO data feed offers a 
competitive, lower-priced alternative to the consolidated data OPRA 
feed for users and situations where consolidated data is unnecessary 
. . . Additionally, to the extent users can substitute the lower-
priced TOPO data for the higher-priced consolidated data feed, those 
users will have the opportunity to pass the savings on to investors 
in the form of lower overall trading costs.'' (emphasis added); and 
see Securities Exchange Act Release No. 68576 (January 3, 2013), 78 
FR 1886 (January 9, 2013) (SRndash;Phlxndash;2012-145), in which two 
years later PHLX states ``First, TOPO, TOPO Plus Orders, PHLX Orders 
and PHLX Depth of Market data feed offer a comprehensive, 
competitive alternative to the consolidated data OPRA feed for users 
and situations where consolidated data is unnecessary'' (emphasis 
added). See also Securities Exchange Act Release No. 79556 (December 
14, 2016), 81 FR 92935 (December 20, 2016) (SR-NASDAQ-2016-167), in 
which The Nasdaq Stock Market LLC stated: ``[m]any customers that 
obtain information from OPRA do not also purchase ITTO and BONO, but 
in cases where customers buy both products, they may shift the 
extent to which they purchase one or the other based on price 
changes. OPRA constrains the price of ITTO and BONO because no 
purchaser would pay an excessive price for these products when 
similar data is also available from OPRA.'' (emphasis added). See 
also NYSE Technology FAQ and Best Practices: Options, Section 6.3 at 
https://www.nyse.com/publicdocs/nyse/NYSE_Options_Technology_FAQ.pdf 
which is a publicly available document posted by OPRA Members NYSE 
American LLC and NYSE Arca, Inc. (collectively ``NYSE'') that 
includes statements inconsistent with the adopted interpretation. 
Particularly, in a section titled ``How do firms receive proprietary 
market data'' NYSE states in relevant part: ``[I]in addition, the 
Exchanges recommend that firms utilizing proprietary market data 
feeds maintain a connection to OPRA, and have the ability to switch 
between the proprietary market data feeds and the OPRA feed, in the 
event that one or the other fails'' (emphasis added).

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[[Page 3965]]

    In March 2023 however, other OPRA Members took a different view and 
asserted that the Equivalent Access Provision can only be satisfied 
where a recipient of an exchange proprietary data feed also maintains a 
streaming subscription to the full OPRA feed (i.e., the ability to 
query OPRA data on a usage-basis would not be deemed to satisfy the 
Equivalent Access Provision). Following months of deliberation between 
OPRA members, OPRA retained counsel, who ultimately provided his 
interpretation that the Equivalent Access Provision requires a user 
receiving a streaming, real-time exchange proprietary data product to 
also receive the full feed of streaming, real-time data from OPRA. On 
September 6, 2023, the OPRA Management Committee, by majority vote, 
determined to adopt counsel's interpretation.\15\ Cboe believes that 
the interpretation adopted by the OPRA Management Committee on 
September 6, 2023 is legally and factually flawed and in opposition to 
the Commission's intent of the 2001 OPRA amendment. As such, Cboe has 
decided to propose an amendment that furthers the policy goals stated 
above by amending the Equivalent Access Provision so it provides that 
(1) access to OPRA data on a usage-basis will also satisfy the 
Equivalent Access Provision and (2) impose certain display requirements 
for both any proprietary market data and consolidated options 
information.
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    \15\ BZX Options, C2 Options, Cboe Options, and EDGX Options 
voted to reject this interpretation.
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Proposal
Usage-Based Data Service
    Cboe proposes to modify Section 5.2(c)(iii)(A) of the OPRA Plan to 
clarify that access to consolidated Options Information and access to 
Proprietary Information are deemed ``equivalent'' if ``Proprietary 
Information'' and ``consolidated Options Information'' (as those terms 
are defined in the OPRA Plan), are equally accessible on the same 
terminal or work station, regardless of whether the OPRA data is 
disseminated on a streaming or per usage basis. Specifically, Cboe 
proposes to revise Section 5.2(c)(iii)(A) of the OPRA Plan to replace 
the sentence the following sentence:

    For purposes of this clause (A), ``consolidated Options 
Information'' means consolidated Last Sale Reports combined with 
either consolidated Quotation Information or the BBO furnished by 
OPRA, and access to consolidated Options Information and access to 
Proprietary Information are deemed ``equivalent'' if both kinds of 
information are equally accessible on the same terminal or work 
station.

with the following sentence:

    For purposes of this clause (A), ``consolidated Options 
Information'' means consolidated Last Sale Reports combined with 
either consolidated Quotation Information or the BBO furnished by 
OPRA, and access to consolidated Options Information and access to 
Proprietary Information are deemed ``equivalent'' if Proprietary 
Information and consolidated Options Information, whether 
disseminated on a streaming- or per usage-basis, are equally 
accessible on the same terminal or work station.

    The new language would clarify that the Equivalent Access Provision 
is satisfied if a recipient of an exchange proprietary data product 
also is simultaneously authorized and entitled to receive OPRA data in 
one of the ways that OPRA makes its data available; that is, by 
maintaining a streaming subscription to the OPRA feed or having the 
ability to query OPRA data on a usage-basis.
    The current Equivalent Access Provision of the OPRA Plan, as 
interpreted by OPRA, requires that vendors purchase a streaming 
subscription to the full OPRA feed alongside any exchange proprietary 
data product. That requirement could be cost-prohibitive or 
technologically unfeasible when considering the growing and significant 
bandwidth requirements associated with the full streaming OPRA data 
feed.\16\ This is especially true where vendors or retail brokers are 
providing such data to individual retail investors who are more likely 
to be low volume users of market data and do not otherwise have the 
same best execution obligations as professional users. For such users, 
query-based access to OPRA data may be more suitable. Moreover, the 
current interpretation of the Equal Access Provision could have the 
practical effect of denying choice for individual data subscribers, as 
compliance with it could be cost-prohibitive for the vendors or retail 
brokers that support them, effectively leaving OPRA's feed as the only 
data source for options market participants--even in scenarios where a 
market participant decides that it does not need consolidated market 
data for its purposes. Such a result ultimately denies choice for 
individual data subscribers, which is antithetical to the SEC's 
longstanding view on competition.
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    \16\ See 
64e8f2c76de012371925ee11_OPRA_Data_Dissemination_Expansion_from_48_to
_96-Line_Multicast_Network_Industry_Test_4.pdf (website-files.com). 
See also 64ada60d17c52b49eb5ee42c_OPRA_96-Line_Expansion_Frequently 
Asked Questions v1.10_071023.pdf (website-files.com).
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    Indeed, when the National Association of Securities Dealers, Inc. 
(``NASD'') first established a per-query fee structure for U.S. 
equities, it noted its purpose was ``to provide retail customers with a 
cost-effective alternative to calling their brokers for current market 
information.'' \17\ As NASD explained, retail investors might not be 
interested in subscribing to a costly service offered by a commercial 
vendor which frequently might include analytic information, ticker 
displays, and dynamically-updated quotation and transaction 
information.\18\ NASD therefore reasoned that the adoption of a query-
based fee structure would provide individual investors a better ability 
to monitor the value of a portfolio, track intra-day activity in a 
given stock to facilitate an investment decision, or observe a market 
trend based on periodic queries for the current level of a popular 
stock index. When approving the proposed fee structure, the Commission 
similarly acknowledged:
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    \17\ See Securities Exchange Act Release No. 35393 (February 17, 
1995), 60 FR 10625 (February 27, 1995) (SR-NASD-95-7).
    \18\ Id.

[the proposed per-query fee structure] and related fee are designed 
to accommodate the information needs of individual investors, 
particularly small investors who do not require the breadth of 
market data and analytic information that institutional investors 
and market makers typically require. . . . this service will allow 
firms and vendors to provide individual investors cost-effective 
access to market data without requiring users to acquire expensive 
hardware. . . . The NASD's experience is that [subscriber fees and 
vendor suppled equipment] costs tend to discourage subscription by 
low-volume users. . . The Commission believes that the $.01/query 
fee is an equitable allocation of a reasonable fee and that it will 
be affordable to individual investors. The Commission, therefore, 
finds

[[Page 3966]]

that the proposal is consistent with the section 15A(b)(5) of the 
Act.\19\
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    \19\ See Securities Exchange Act Release No. 35721 (May 16, 
1995), 60 FR 98 (May 22, 1995) (SR-NASD-95-7).

    Although, the Commission's finding related to US equities pricing 
data, the underlying rationale applies with equal force to the options 
industry. OPRA's current interpretation of the Equal Access provision 
is directly at odds with that SEC statement--instead of facilitating 
cost effective access that will ``accommodate the information needs of 
individual investors,'' it will disfavor small investors that do not 
require--and may be unable to pay for or technologically accommodate--a 
full feed of streaming, real-time data from OPRA.
    In addition, when OPRA amended its rules to make usage based access 
permanently available following a pilot, OPRA stated that ``the 
availability of these alternative [usage-based] fees has not had any 
significant negative impact on OPRA's overall revenues or on the fair 
allocation of OPRA's basic service fees to persons who have access to 
options market information.'' \20\ Therefore, the ability to choose the 
manner in which OPRA data is received (i.e., either via a streaming 
subscription or on a query basis) to satisfy the Equivalent Access 
Provision will not harm OPRA's financial position, while at the same 
time providing the possibility of lower overall costs for US options 
market data users and permitting them to better evaluate the cost-to-
value ratio of obtaining different types of data. In sum, Cboe believes 
that its proposal will further access to market data generally and will 
equip investors, including retail investors, with the ability to make 
informed investment decisions.
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    \20\ See Securities Exchange Act Release No. 37686 (September 
16, 1996), 61 FR 49801 (September 23, 1996) (emphasis added).
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    Moreover, under Cboe's proposal, all investors receiving exchange 
proprietary data will continue to have access to OPRA data should they 
so choose. The only difference is that the proposed amendment will 
provide subscribers with flexibility to choose the manner in which they 
are able to view the data. More specifically, since OPRA's usage-based 
data service allows market participants to obtain quote packets and 
options chains on their terminal or work station, by definition, that 
service will still provide equivalent access to ``consolidated Options 
Information'' because that market participants will have access to 
``Last Sale Reports,'' ``Quotation Information,'' and the ``BBO'', as 
required under the current Equivalent Access Provision.
    Cboe also believes absent its proposed amendment, there could be 
discriminatory application of fees between market participants who 
choose to subscribe to exchange proprietary data products and those who 
do not. That discriminatory treatment arises because, absent the 
proposed amendment, only those market participants who do not also 
subscribe to exchange proprietary market data products may avail 
themselves of OPRA's potentially more cost-effective usage-based data 
service. That scenario only serves to penalize those market 
participants who choose to subscribe to exchange proprietary data 
products because such participants (unlike those who do not subscribe 
to proprietary market data products) will be required to also subscribe 
to, and pay for, the more expensive full streaming OPRA data feed 
regardless of their needs. As noted, in some cases, retail investors 
(or the retail brokers that support them) may not be able to afford or 
technologically process the large size of the full streaming OPRA data; 
effectively precluding this subset of retail investors from accessing 
proprietary options data at all.
    Finally, Cboe believes its proposal fosters pricing competition 
because it provides users with more choices about what OPRA data to 
subscribe to, and what, if any, exchange data to subscribe to. That 
increased choice reduces that possibility that any one market data 
provider, including OPRA, could charge non-competitive prices for its 
data. In other words, that proposed amendment would result in a 
situation where all exchanges, as well as OPRA, would have an incentive 
to price their market data products based on the value relative to that 
of other markets, as they would otherwise risk that market participants 
would not subscribe to their products. As such, exchanges would have to 
compete on the price or quality of their data (e.g., by offering 
consistently better quotes) to generate potential subscriber interest 
in their data. This added incentive to compete, in turn, could enhance 
liquidity and have a beneficial effect on intermarket competition.
Display Requirement
    Cboe also proposes to add a new paragraph to the Equivalent Access 
Provision: proposed paragraph (C) of Section 5.2(c)(iii) of the OPRA 
Plan. Proposed paragraph (C) would include two requirements. First, 
Cboe proposes to require that dissemination of consolidated Options 
Information for the same classes or series of options that are included 
in the Proprietary Information must be displayed in a context in which 
a trading or order-routing decision can be implemented (i.e., the point 
of order entry or modification). Accordingly, Cboe proposes to add the 
following requirement: ``dissemination of consolidated Options 
Information for the same classes or series of options that are included 
in the Proprietary Information must be displayed in a context in which 
a trading or order-routing decision can be implemented (i.e., the point 
of order entry or modification).'' Second, Cboe proposes that 
consolidated Options Information must also be provided if a registered 
representative of a broker-dealer provides a quotation to a customer 
that can be used to assess the current market or the quality of trade 
execution. Therefore, Cboe proposes to include in proposed paragraph 
(C) of Section 5.2(c)(iii) the following requirement: that 
``Consolidated Options Information must also be provided if a 
registered representative of a broker- dealer provides a quotation to a 
customer that can be used to assess the current market or the quality 
of trade execution.''
    Like the Vendor Display Rule \21\ that applies to equities market 
data, Cboe proposes to amend the Equivalent Access Provision to also 
require a display of consolidated Options Information when it is most 
needed--when a trading or order-routing decision could be implemented. 
Additionally, Cboe proposes to clarify in the text of new Section 
5.2(c)(iii)(C) of the OPRA Plan that the time when a trading or order-
routing decision means at ``the point of order entry or modification.'' 
As is the case under the Vendor Display Rule, Cboe is not proposing 
that a display of consolidated data be required when market data is 
being provided on a purely informational website that does not offer 
any trading or order-routing capability.
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    \21\ 17 CFR 242.603.
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    Cboe also proposes to make clear that OPRA ``consolidated Options 
Information'' must also be provided if a registered representative of a 
broker-dealer provides a quotation to a customer that can be used to 
assess the current market or the quality of trade execution. The 
foregoing requirement codifies guidance provided by the SEC in 
connection with the Vendor Display Rule.\22\
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    \22\ See Denial of No-Action Request under Rule 603(c) of 
Regulation NMS, from Stephen Luparello, Director, Division of 
Trading and Markets, SEC, to Eric Swanson, EVP, General Counsel & 
Secretary BATS, dated July 22, 2015. The response letter from the 
staff of the SEC's Division of Trading and Markets is available on 
the SEC's website.

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[[Page 3967]]

    When adopting the Vendor Display Rule, the Commission expressed its 
view that the NBBO continues to provide a great deal of value for 
retail investors in assessing the current market for small trades and 
the quality of execution of such trades.\23\ Subsequently, in a 2015 
Denial of No-Action Request under Rule 603(c) of Regulation NMS, SEC 
staff stated their belief that when a registered representative of a 
broker-dealer provides a quotation to a customer, it is typically done 
in a context where the customer uses that information to make a trading 
decision (including a decision regarding whether or not to trade, or 
the terms of the trade such as a limit price).\24\ The SEC therefore 
stated in its Denial of No-Action Request that it believed that a 
quotation provided by a registered representative to a customer, which 
the customer can use to assess the current market or the quality of 
trade execution, is provided ``in a context in which a trading or 
order- routing decision can be implemented'' for purposes of the Vendor 
Display Rule.
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    \23\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37496, 37567 (June 29, 2005) (``Regulation NMS Adopting 
Release'').
    \24\ Supra note [21].
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    The proposed adoption of new subparagraph (C) under Section 
5.2(c)(iii) of the OPRA Plan is designed to ensure continuing access to 
real-time ``consolidated Options Information,'' a long-standing 
requirement in the securities industry to display consolidated market 
data at the times when it is most needed. With the recent growth in US 
options trading, and a large portion of that growth coming from retail 
investors, it is imperative to continue to empower those investors with 
cost-effective U.S. options pricing information, along with the ability 
to choose the manner in which they access such data in accordance with 
their needs. Cboe believes its proposed display requirements, coupled 
with the proposal to clarify that OPRA's usage-based data service 
satisfies the Equivalent Access Provision, will achieve that objective 
and therefore meets the standard of being appropriate in the public 
interest, for the protection of investors and the maintenance of fair 
and orderly markets, and removes impediments to, and perfects the 
mechanism of, a national market system.\25\
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    \25\ 17 CFR 242.608(b)(2).
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2. Text of Amendment

    Cboe proposes to modify Section 5.2(c)(iii) of the OPRA Plan. The 
existing OPRA Plan is available on the OPRA website, www.opraplan.com, 
under the ``Document Library'' tab. The amendments that Cboe is 
proposing are in attached Exhibit A.

3. Manner of Implementation of Amendment

    The proposed amendment will be incorporated into the OPRA Plan 
following Commission approval of the amendment pursuant to Rule 
608(b)(1) and (b)(2) of Regulation NMS.

4. Phases of Development and Implementation

    Not applicable.

5. Impact on Competition

    Cboe believes that the proposed amendment will impose no burdens on 
competition that are not justified in light of the purposes of the Act. 
Rather, for the reasons discussed more fully above, Cboe believes the 
proposed amendment furthers competition and incorporates what Cboe 
believes to be the historical interpretation of the Equivalent Access 
Provision by many market participants across the industry. The proposal 
to clarify that OPRA's usage-based data services satisfies the 
Equivalent Access Provision, coupled with the proposed display 
requirements. would provide investors, particularly retail investors 
and the retail brokers that support them, with cost- effective U.S. 
options pricing information, along with the ability to choose the 
manner in which they access such data in accordance with their needs. 
Cboe believes that its proposal will further access to market data 
generally and will equip investors, including retail investors, with 
the ability to make informed investment decisions.
    In particular, Cboe believes that the proposed amendments to the 
OPRA Plan would avoid an interpretation that would limit access to 
valuable options market data by imposing a cost prohibitive and/or 
technologically unfeasible requirement on investors, particularly low 
volume users like individual retail investors. The proposal also will 
provide the possibility of lower overall costs for US options market 
data users and permitting them to better evaluate the cost-to-value 
ratio of obtaining different types of data. Moreover, the proposed 
amendment would avoid rendering exchange proprietary market data 
products redundant, effectively leaving OPRA's feed as the only data 
source for options market participants such as retail investors. 
Furthermore, Cboe does not believe that the ability to choose the 
manner in which OPRA data is received (i.e., either via a streaming 
subscription or on a query basis) to satisfy the Equivalent Access 
Provision would harm OPRA's financial position, and therefore would not 
have an adverse effect on consolidated market data for the options 
industry.

6. Written Understandings or Agreements Among Plan Members

    Not applicable.

7. Approval of Proposed Amendment

    Not applicable.

8. Exhibits

    Proposed amendments to the OPRA Plan set forth in Exhibit A.

9. Description of Operation of Facility Contemplated by the Proposed 
Amendment

    Not applicable.

10. Terms and Conditions of Access

    Not applicable.

11. Method of Determination and Imposition, and Amount of, Fees and 
Charges

    Not applicable.

12. Method and Frequency of Processor Evaluation

    Not applicable.

13. Dispute Resolution

    The Plan does not include provisions regarding resolution of 
disputes between or among the Members.

II. Proposed Revisions to OPRA Plan (Exhibit A to the Amendment)

    Additions italicized; deletions [bracketed]

Limited Liability Company Agreement of Options Price Reporting 
Authority, LLC a Delaware Limited Liability Company

* * * * *

Section 5.2. Collection and Dissemination of Options Last Sale 
Reports and Quotation Information.

* * * * *
    (c) Dissemination of Last Sale Reports, Quotation Information 
and Other Information.
* * * * *
    (iii) A Member may disseminate its Proprietary Information 
pursuant to subparagraph (ii) of this paragraph (c) provided that:
    (A) such dissemination is limited to other Members and to 
persons who also have equivalent access to consolidated Options 
Information disseminated by OPRA for the same classes or series of 
options that are included in the Proprietary Information. For

[[Page 3968]]

purposes of this clause (A), ``consolidated Options Information'' 
means consolidated Last Sale Reports combined with either 
consolidated Quotation Information or the BBO furnished by OPRA, and 
access to consolidated Options Information and access to Proprietary 
Information are deemed ``equivalent'' if Proprietary Information and 
consolidated Options Information, whether disseminated on a 
streaming- or per usage-basis, [both kinds of information] are 
equally accessible on the same terminal or work station; [and]
    (B) a Member may not disseminate its Proprietary Information on 
any more timely basis than the same information is furnished to the 
OPRA System for inclusion in OPRA's consolidated dissemination of 
Options Information;[.] and
    (C) dissemination of consolidated Options Information for the 
same classes or series of options that are included in the 
Proprietary Information must be displayed in a context in which a 
trading or order-routing decision can be implemented (i.e., the 
point of order entry or modification). Consolidated Options 
Information must also be provided if a registered representative of 
a broker-dealer provides a quotation to a customer that can be used 
to assess the current market or the quality of trade execution.
* * * * *

III. Solicitation of Comments

    The Commission seeks comment on the Amendment. Interested persons 
are invited to submit written data, views and arguments concerning the 
foregoing, including whether the proposed amendment is necessary or 
appropriate in the public interest, for the protection of investors and 
the maintenance of fair and orderly markets, to remove impediments to, 
and perfect the mechanisms of, a national market system, or otherwise 
in furtherance of the purposes of the Act. Comments may be submitted by 
any of the following methods:

Electronic Comments

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number 4-820 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 4-820. 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 (https://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 a.m. and 3 
p.m. Copies of the filing also will be available for inspection and 
copying at the principal offices of the Sponsors. Do not include 
personal identifiable information in submissions; you should submit 
only information that you wish to make available publicly. We may 
redact in part or withhold entirely from publication submitted material 
that is obscene or subject to copyright protection. All submissions 
should refer to file number 4-820 and should be submitted on or before 
February 12, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\26\
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    \26\ 17 CFR 200.30-3(a)(85).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-01071 Filed 1-19-24; 8:45 am]
BILLING CODE 8011-01-P