[Federal Register Volume 89, Number 57 (Friday, March 22, 2024)]
[Notices]
[Pages 20509-20511]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-06072]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-99762; File No. SR-CBOE-2024-013]


Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
Its Fees Schedule

March 18, 2024.
    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 March 7, 2024, Cboe Exchange, Inc. (``Exchange'' or ``Cboe 
Options'') 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

[[Page 20510]]

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

    Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe Options'') proposes 
to amend its Fees Schedule. The text of the proposed rule change is 
provided in Exhibit 5.
    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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Fees Schedule, effective March 
7, 2024. Specifically, the Exchange proposes to make clarifying changes 
to the ``Regulatory Fees'' section. Under the Exchange's Regulatory 
Fees, the Exchange charges a fee to TPHs, including Designated Primary 
Market-Makers \3\ (``DPMs''), that are subject to Rule 15c3-1 under the 
Exchange Act (the ``Net Capital Rule'') \4\ and for which the Exchange 
has been assigned as the Designated Examining Authority (``DEA''), 
called the ``DPM's and Firm Designated Examining Authority Fee.'' The 
Exchange currently charges TPHs subject to this fee $0.60 per $1,000 of 
gross revenue as reported on quarterly FOCUS reports filed by such TPHs 
(excluding commodity commission revenue). In addition, this fee is 
subject to a monthly minimum fee of $1,500 per month for Clearing TPHs 
and $400 for non-Clearing TPHs.
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    \3\ See Exchange Rule 1.1, which defines a ``Designated Primary 
Market-Maker.''
    \4\ 17 CFR 240.15c3-1.
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    The Exchange first proposes to remove ``DPM'' from the fee title, 
as such fee is not assessed to TPHs because of their DPM capacity. As 
stated above, the Firm DEA Fee is assessed to all TPHs that are subject 
to the Net Capital Rule and for which the Exchange has been assigned as 
the DEA. While this may include DPMs, it does not necessarily include 
all DPMs; thus, the Exchange proposes to remove DPM from the fee title, 
to avoid potential confusion and clarify the purpose and application of 
the fee.
    Further, the Exchange proposes to add clarifying language regarding 
the calculation and billing of the Firm DEA Fee to add further 
transparency to the Fees Schedule. The Firm DEA Fee is calculated by 
the Exchange and assessed to TPHs, as applicable, on a quarterly basis. 
The Exchange proposes to add language stating that if the Exchange is 
the DEA for a TPH for less than all three months of the relevant 
quarter, the Firm DEA Fee for the TPH for that quarter is prorated 
based on the number of months in the quarter in which the Exchange 
acted as DEA for the TPH.
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 the 
Section 6(b)(5) \7\ requirement that the rules of an exchange not be 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers. The Exchange also believes the proposed rule 
change is consistent with Section 6(b)(4) of the Act,\8\ 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.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
    \7\ Id.
    \8\ 15 U.S.C. 78f(b)(4).
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    In particular, the Exchange believes the proposed rule changes to 
the Fees Schedule do not change any fees charged pursuant to the Firm 
DEA Fee, but rather are clarifying in nature, and thus, the fee will 
continue to be reasonable and equitable, and uniformly applied, as 
applicable, to all TPHs that are subject to the Net Capital Rule and 
for which the Exchange has been assigned as the DEA. The Exchange 
believes the proposed rule changes remove impediments to and perfect 
the mechanism of a free and open market and national market system as 
they add clarity, mitigate any potential confusion in connection with 
the application of these fees or billing in connection with these fees, 
and facilitate better understanding of the Fees Schedule for all market 
participants, which ultimately protects investors.

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. As indicated above, the 
proposed changes to the Fees Schedule clarify language regarding the 
Firm DEA Fee. As the Exchange is not changing the fee itself, but 
merely clarifying who the fee is assessed to and how the fee is billed, 
the Exchange believes the proposed clarifying rule amendments do not 
substantively change the Firm DEA Fee or the manner in which it 
currently applies to market participants, as applicable. The proposed 
changes are not competitive in nature and are merely intended to clean 
up the Fees Schedule in order to provide additional clarity and 
facilitate better understanding of the Fees Schedule for all 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

    Because the proposed rule change does not: (i) significantly affect 
the

[[Page 20511]]

protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \9\ and Rule 
19b-4(f)(6) thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \10\ 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, 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 under Rule 19b-4(f)(6) \11\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\12\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposed 
rule change may become operative immediately upon filing. The 
Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest, 
because it will allow the Exchange to make clarifying changes to its 
Fee Schedule. Accordingly, the Commission designates the proposed rule 
change to be operative upon filing.\13\
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    \11\ 17 CFR 240.19b-4(f)(6).
    \12\ 17 CFR 240.19b-4(f)(6)(iii).
    \13\ For purposes only of waiving the 30-day operative delay, 
the Commission has also 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 under 
Section 19(b)(2)(B) \14\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \14\ 15 U.S.C. 78s(b)(2)(B).
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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 (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-CBOE-2024-013 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-2024-013. 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 office of the Exchange. 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 SR-CBOE-2024-013 and should be 
submitted on or before April 12, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12), (59).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-06072 Filed 3-21-24; 8:45 am]
BILLING CODE 8011-01-P