to ``securities transactions'' rather than ``options securities
transactions.''
     Rule 3180(a) (Mandatory Systems Testing): The Exchange
proposes to amend subsection (a)(1) of Rule 3180 to also include BSTX
Participants, in addition to the categories of Market Makers and OFPs.
     Rule 7130(a)(2)(v) Execution and Price/Time Priority: The
Exchange proposes to update the cross reference to Rule 100(a)(58) to
refer to Rule 100(a)(59), which defines the term ``Request for Quote''
or ``RFQ'' under the Rules after the proposed renumbering.
     Rule 7150(a)(2) (Price Improvement Period): The Exchange
proposes to amend Rule 7150(a)(2) to update the cross reference to the
definition of a Professional in Rule 100(a)(51) to instead refer to
Rule 100(a)(52), which is where that term would be defined in the Rules
after the proposed renumbering.
     Rule 7230 (Limitation of Liability): The Exchange proposes
to amend the references in Rule 7230 to ``Options Participants'' to
simply ``Participants.''
     Rule 7245(a)(4) (Complex Order Price Improve Period): The
Exchange proposes to update the cross reference to Rule 100(a)(51) to
refer to Rule 100(a)(52), which defines the term ``Professional'' after
the proposed renumbering.
     IM-8050-3: The Exchange proposes to update the cross
reference to Rule 100(a)(56) to refer to Rule 100(a)(57), which defines
the term ``quote'' or ``quotation'' after the proposed renumbering.
     Rule 11010(a) ``Investigation Following Suspension'': The
Exchange proposes to amend subsection (a) of Rule 11010 to remove the
reference to ``in BOX options contracts'' and to modify the word
``position'' with the word ``security'' as follows: ``. . . the amount
owing to each and a complete list of each open long and short security
position maintained by the Participant and each of his or its
Customers.''
     Rule 11030 (Failure to Obtain Reinstatement): The Exchange
proposes to amend Rule 11030 to replace the reference to ``Options
Participant'' to simply ``Participant.''
     Rule 12140 (Imposition of Fines for Minor Rule
Violations): The Exchange proposes to amend Rule 12140 to replace
references to ``Options Participant'' to simply ``Participant.'' In
addition, the Exchange proposes to add paragraph (f) to Rule 12140, to
incorporate the aforementioned modifications to the Exchange's MRVP.
New paragraph (f) of Rule 12140 would provide: ``(f) Transactions on
BSTX. Rules and penalties relating to trading on BSTX that are set
forth in Rule 24010 (Penalty for Minor Rule Violations).''
    The Exchange believes that the proposed amendments to the
definitions set forth in Rule 100 are consistent with

Section 6(b)(5) of the Exchange Act \312\ because they protect
investors and the public interest by setting forth clear definitions
that help BOX and BSTX Participants understand and apply Exchange
Rules. Without defining terms used in the Exchange Rules clearly,
market participants could be confused as to the application of certain
rules, which could cause harm to investors.
---------------------------------------------------------------------------

    \312\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed amendments to the other
Exchange Rules detailed above are consistent with Section 6(b)(5) of
the Exchange Act \313\ because the proposed rule change is designed to
foster cooperation and coordination with persons engaged in
facilitating transactions in securities, 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.
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
notes that none of the proposed changes to the current Exchange
rulebook would materially alter the application of any of those Rules,
other than by extending them to apply to BSTX Participants and trading
on the BSTX System. 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.
---------------------------------------------------------------------------

    \313\ Id.
---------------------------------------------------------------------------

Forms To Be Used in Connection With BSTX
    In connection with the operation of BSTX, the Exchange proposes to
uses a series of new forms to facilitate becoming a BSTX Participant
and for issuers to list their Securities. These forms have been
submitted with the proposal as Exhibits 3A-3L. Each are described
below.
BSTX Participant Application
    Pursuant to proposed Rule 18000(b), in order to become a BSTX
Participant, an applicant must complete a BSTX Participant Application,
which has been submitted with the proposal as Exhibit 3A. The proposed
BSTX Participant Application requires the applicant to provide certain
basic information such as identifying the applicants name and contact
information, Designated Examining Authority, organizational structure,
and Central Registration Depository (``CRD'') number. The BSTX
Participant Application also requires applicants to provide additional
information including certain beneficial ownership information, the
applicant's current Form BD, an organization chart, a description of
how the applicant receives orders from customers, how it will send
orders to BSTX, and a copy of written supervisory procedures and
information barrier procedures.
    In addition, the BSTX Participant Application allows applicants to
indicate whether they are applying to be a BSTX Market Maker or a
Designated Market Maker. Applicants wishing to become a BSTX Market
Maker or Designated Market Maker must provide certain additional
information including a list of each of the applicant's trading
representatives (including a copy of each representative's Form U4), a
copy of the applicant's written supervisory procedures relating to
market making, a description of the source and amount of the
applicant's capital, and information regarding the applicant's other
business activities and information barrier procedures.
BSTX Participant Agreement
    Pursuant to Exchange Rule 18000(b), to transact business on BSTX,
prospective BSTX Participants must complete a BSTX Participant
Agreement. The BSTX Participant Agreement has been submitted with the
proposal as Exhibit 3B. The BSTX Participant Agreement provides that a
BSTX Participant must agree with the Exchange as follows:
    1. Participant agrees to abide by the Rules of the Exchange and
applicable bylaws, as amended from time to time, and all circulars,
notices, interpretations, directives and/or decisions adopted by the
Exchange.
    2. Participant acknowledges that BSTX Participant and its
associated persons are subject to the oversight and jurisdiction of the
Exchange.
    3. Participant authorizes the Exchange to make available to any
governmental agency or SRO any information it may have concerning the
BSTX Participant or its associated persons, and releases the Exchange
from any and all liability in furnishing such information.
    4. Participant acknowledges its obligation to update any and all
information contained in any part of the BSTX Participant's
application, including termination of membership with another SRO.
    These provisions of the BSTX Participant Agreement and others
therein are generally designed to reflect the Exchange's SRO
obligations to regulate BSTX Participants. Accordingly, these
provisions contractually bind a BSTX Participant to comply with
Exchange rules, acknowledge the Exchange's oversight and jurisdiction,
authorize the Exchange to disclose information regarding the
Participant to any governmental agency or SRO and acknowledge the
obligation to update any and all Application contained in the
Participant's application.
BSTX User Agreement
    In order to become a BSTX Participant, prospective participants
must also execute a BSTX User Agreement pursuant to proposed Rule
18000(b). The BSTX User Agreement, submitted with the proposal as
Exhibit 3C, includes provisions related to the term of the agreement,
compliance with exchange rules, right and obligations under the
agreement, changes to BSTX, proprietary rights under the agreement, use
of information received under the relationship, disclaimer of warranty,
limitation of liability, indemnification, termination and assignment.
The information is necessary to outline the rights and obligations of
the prospective Participant and the Exchange under the terms of the
agreement. Both the BSTX Participant Agreement and BSTX User Agreement
will be available on the Exchange's website (http://boxoptions.com">boxoptions.com).
BSTX Security Market Designated Market Maker Selection Form
    In accordance with proposed Rule 25230(b)(1), BSTX will maintain
the BSTX Security Designated Market Maker Selection Form, which has
been submitted with the proposal as Exhibit 3D. The issuer may select
its DMM from among a pool of DMMs eligible to participate in the
process. Within two business days of the issuer selecting its DMM, it
will use the BSTX Security Market Designated Market Maker Selection
form to notify BSTX of the selection. The form must be signed by a duly
authorized officer as specified in proposed Rule 25230(b)(1).

Clearing Authorization Forms
    In accordance with proposed Rule 18010, BSTX Participants that are
not members/participants of a registered clearing agency must clear
their transactions through a BSTX Participant that is a member of a
registered clearing agency. A BSTX Participant clearing through another
BSTX Participant would do so using, as applicable, either the BSTX
Clearing Authorization (non-Market Maker) form (submitted with the
proposal as Exhibit 3E) or the BSTX Participant Clearing Authorization
(Market Maker) form (submitted with the proposal as Exhibit 3F). Each
form would be maintained by BSTX and each form specifies that the BSTX
Participant clearing on behalf of the other BSTX Participant accepts
financial responsibility for all transactions on BSTX that are made by
the BSTX Participant designated on the form.
BSTX Listing Applications
    The Exchange proposes to specify the required forms of listing
application, listing agreement and other documentation that listing
applicants and listed companies must execute or complete (as
applicable) as a prerequisite for initial and ongoing listing on the
Exchange, as applicable (collectively, ``listing documentation''). As
proposed, the listing forms are substantially similar to those
currently in use by NYSE American LLC, with certain differences to
account for the trading of Securities. All listing documentation will
be available on the Exchange's website (http://boxoptions.com">boxoptions.com). Each of the
listing documents form a duly authorized representative of the company
must sign an affirmation that the information provided is true and
correct as of the date the form was signed. In the event that in the
future the Exchange makes any substantive changes (including changes to
the rights, duties, or obligations of a listed company or listing
applicant or the Exchange, or that would otherwise require a rule
filing) to such documents, it will submit a rule filing in accordance
with Rule 19b-4.\314\
---------------------------------------------------------------------------

    \314\ The Exchange will not submit a rule filing if the changes
made to a document are solely typographical or stylistic in nature.
---------------------------------------------------------------------------

    Pursuant to Rule 26130 and 26300 of the Exchange Rules, a company
must file and execute the BSTX Original Listing Application (submitted
with the proposal as Exhibit 3G) or the BSTX Additional Listing
Application (submitted with the proposal as Exhibit 3H) to apply for
the listing of Securities on BSTX.\315\ The BSTX Original Listing
Application provides information necessary, and in accordance with
Section 12(b) of the Exchange Act,\316\ for Exchange regulatory staff
to conduct a due diligence review of a company to determine if it
qualifies for listing on the Exchange. The BSTX Additional Listing
Application requires certain further information for an additional
listing of Securities. Relevant factors regarding the company and
securities to be listed would determine the type of information
required. The following describes each category and use of application
information:
---------------------------------------------------------------------------

    \315\ Pursuant to proposed Exchange Rule 26130, an applicant
seeking the initial listing of its Security must also provide a
legal opinion that the applicant's Security is a security under
applicable United States securities laws.
    \316\ 15 U.S.C. 78l(b).
---------------------------------------------------------------------------

    1. Corporate information regarding the issuer of the security to be
listed, including company name, address, contact information, Central
Index Key Code (CIK), SEC File Number, state and country of
incorporation, date of incorporation, whether the company is a foreign
private issuer, website address, SIC Code, CUSIP number of the security
being listed and the date of fiscal year end. This information is
required of all applicants and is necessary in order for the Exchange's
regulatory staff to collect basic company information for recordkeeping
and due diligence purposes, including review of information contained
in the company's SEC filings.
    2. For original listing applications only, corporate contact
information including the company's Chief Executive Officer, Chief
Financial Officer, Corporate Secretary, General Counsel and Investor
Relations Officer. This information is required of all initial
applicants and is necessary in order for the Exchange's regulatory
staff to collect current company contact information for purposes of
obtaining any additional due diligence information to complete a
listing qualification review of the applicant.
    3. For original listing applications only, offering and security
information regarding an offering, including the type of offering, a
description of the issue, par value, number of Securities outstanding
or offered, total Securities unissued, but reserved for issuance, date
authorized, purpose of Securities to be issued, number of Securities
authorized, and information relating to payment of dividends. This
information is required of all applicants listing Securities on the
Exchange, and is necessary in order for the Exchange's regulatory staff
to collect basic information about the offering.
    4. For original listing applications only, information regarding
the company's transfer agent. Transfer agent information is required
for all applicants. This information is necessary in order for the
Exchange's regulatory staff to collect current contact information for
such company transfer agent for purposes of obtaining any additional
due diligence information to complete a listing qualification review of
the applicant.
    5. For original listing applications only, contact information for
the outside counsel with respect to the listing application, if any.
This information is necessary in order for the Exchange's regulatory
staff to collect applicable contact information for purposes of
obtaining any additional due diligence information to complete a
listing qualification review of the applicant and assess compliance
with Exchange Rule 26130.
    6. For original listing applications only, a description of any
security preferences. This information is necessary to determine
whether the Applicant issuer has any existing class of common stock or
equity securities entitling the holders to differential voting rights,
dividend payments, or other preferences.
    7. For original listing applications only, type of Security
listing, including the type of transaction (initial public offering of
a Security, merger, spin-off, follow on offering, reorganization,
exchange offer or conversion) and other details related to the
transaction, including the name and contact information for the
investment banker/financial advisor contacts. This information is
necessary in order for the Exchange's regulatory staff to collect
information for such company for purposes of obtaining any additional
due diligence information to complete a listing qualification review of
the applicant.
    8. For original listing applications only, exchange requirements
for listing consideration. This section notes that to be considered for
listing, the Applicant Issuer must meet the Exchange's minimum listing
requirements, that the Exchange has broad discretion regarding the
listing of any Security and may deny listing or apply additional or
more stringent criteria based on any event, condition or circumstance
that makes the listing of an Applicant Issuer's Security inadvisable or
unwarranted in the opinion of the Exchange. The section also notes that
even if an Applicant Issuer meets the Exchange's listing standards for
listing on the BSTX Security Market, it does not necessarily mean that
its application will be

approved. This information is necessary in order for the Exchange's
regulatory staff to assess whether an Applicant Issuer is qualified for
listing.
    9. For original listing applications only, regulatory review
information, including a certification that no officer, board member or
non-institutional shareholder with greater than 10% ownership of the
company has been convicted of a felony or misdemeanor relating to
financial issues during the past ten years or a detailed description of
any such matters. This section also notes that the Exchange will review
background materials available to it regarding the aforementioned
individuals as part of the eligibility review process. This regulatory
review information is necessary in order for the Exchange's regulatory
staff to assess whether there are regulatory matters related to the
company that render it unqualified for listing.
    10. For original listing applications only, supporting
documentation required prior to listing approval includes a listing
agreement, corporate governance affirmation, listing application
checklist and underwriter's letter. This documentation is necessary in
order to support the Exchange's regulatory staff listing qualification
review (corporate governance affirmation, listing application checklist
and underwriter's letter) and to effectuate the listed company's
agreement to the terms of listing (listing agreement).
    11. For additional listing applications only, transaction details,
including the purpose of the issuance, total Securities, date of board
authorization, date of shareholder authorization and anticipated date
of issuance. This information is required of all applicants listing
additional Securities on the Exchange, and is necessary in order for
the Exchange's regulatory staff to collect basic information about the
offering.
    12. For additional listing applications only, insider participation
and future potential issuances, including whether any director, officer
or principal shareholder of the company has a direct or indirect
interest in the transaction, and if the transaction potentially
requires the company to issue any Securities in the future above the
amount they are currently applying for. This information is required of
all applicants listing additional Securities on the Exchange, and is
necessary in order for the Exchange's regulatory staff to collect basic
information about the offering.
    13. For additional listing applications only, information for a
technical original listing, including reverse Security splits and
changes in states of incorporation. This information is required of all
applicants listing additional Securities on the Exchange, and is
necessary in order for the Exchange's regulatory staff to collect basic
information about the offering.
    14. For additional listing applications only, information for a
forward Security split or Security dividend, including forward Security
split ratios and information related to Security dividends. This
information is required of all applicants listing additional Securities
on the Exchange, and is necessary in order to determine the rights
associated with the Securities.
    15. For additional listing applications only, relevant company
documents. This information is required of all applicants listing
additional Securities on the Exchange, and is necessary to assess to
support the Exchange's regulatory staff listing qualification review.
    16. For additional listing applications only, reconciliation for
technical original listing, including Securities issued and outstanding
after the technical original event, listed reserves previously approved
for listing, and unlisted reserves not yet approved by the Exchange.
This information is required of all applicants listing additional
Securities on the Exchange, and is necessary to assess to support the
Exchange's regulatory staff listing qualification review and to obtain
all of the information relevant to the offering.
Checklist for Original Listing Application
    In order to assist issuers seeking to list its Securities on BSTX,
the Exchange has provided a checklist for issuers to seeking to file an
original listing application with BSTX. The BSTX Listing Application
Checklist, submitted with the proposal as Exhibit 3I, provides that
issuers must provide BSTX with a listing application, listing
agreement, corporate governance affirmation, underwriter's letter (for
an initial public offering of a Security only) and relevant SEC filings
(e.g., 8-A, 10, 40-F, 20-F). Each of the above referenced forms are
fully described herein. The checklist is necessary to assist issuers
and the Exchange regulatory staff in assessing the completion of the
relevant documents.
BSTX Security Market Listing Agreement
    Pursuant to proposed Exchange Rule 26132, to apply for listing on
the Exchange, a company must execute the BSTX Security Market Listing
Agreement (the ``Listing Agreement''), which has been submitted with
this proposal as Exhibit 3J. Pursuant to the proposed Listing
Agreement, a company agrees with the Exchange as follows:
    1. Company certifies that it will comply with all Exchange rules,
policies, and procedures that apply to listed companies as they are now
in effect and as they may be amended from time to time, regardless of
whether the Company's organization documents would allow for a
different result.
    2. Company shall notify the Exchange at least 20 days in advance of
any change in the form or nature of any listed Securities or in the
rights, benefits, and privileges of the holders of such Securities.
    3. Company understands that the Exchange may remove its Securities
from listing on the BSTX Security Market, pursuant to applicable
procedures, if it fails to meet one or more requirements of Paragraphs
1 and 2 of this agreement.
    4. In order to publicize the Company's listing on the BSTX Security
Market, the Company authorizes the Exchange to use the Company's
corporate logos, website address, trade names, and trade/service marks
in order to convey quotation information, transactional reporting
information, and other information regarding the Company in connection
with the Exchange. In order to ensure the accuracy of the information,
the Company agrees to provide the Exchange with the Company's current
corporate logos, website address, trade names, and trade/service marks
and with any subsequent changes to those logos, trade names and marks.
The Listing Agreement further requires that the Company specify a
telephone number to which questions regarding logo usage should be
directed.
    5. Company indemnifies the Exchange and holds it harmless from any
third-party rights and/or claims arising out of use by the Exchange or,
any affiliate or facility of the Exchange (``Corporations'') of the
Company's corporate logos, website address, trade names, trade/service
marks, and/or the trading symbol used by the Company.
    6. Company warrants and represents that the trading symbol to be
used by the Company does not violate any trade/service mark, trade
name, or other intellectual property right of any third party. The
Company's trading symbol is provided to the Company for the limited
purpose of identifying the Company's security in authorized quotation
and trading systems. The Exchange reserves the right to change the
Company's trading symbol at the Exchange's discretion at any time.

    7. Company agrees to furnish to the Exchange on demand such
information concerning the Company as the Exchange may reasonably
request.
    8. Company agrees to pay when due all fees associated with its
listing of Securities on the BSTX Security Market, in accordance with
the Exchange's Rules.
    9. Company agrees to file all required periodic financial reports
with the SEC, including annual reports and, where applicable, quarterly
or semi-annual reports, by the due dates established by the SEC.
    The various provisions of the Listing Agreement are designed to
accomplish several objectives. First, clauses 1-3 and 6-8 reflect the
Exchange's SRO obligations to assure that only listed companies that
are compliant with applicable Exchange rules may remain listed. Thus,
these provisions contractually bind a listed company to comply with
Exchange rules, provide notification of any corporate action or other
event that will cause the company to cease to be in compliance with
Exchange listing requirements, evidence the company's understanding
that it may be removed from listing (subject to applicable procedures)
if it fails to be in compliance or notify the Exchange of any event of
noncompliance, furnish the Exchange with requested information on
demand, pay all fees due and file all required periodic reports with
the SEC. Clauses four and five contain standard legal representations
and agreements from the listed company to the Exchange regarding use of
its logo, trade names, trade/service markets, and trading symbols as
well as potential legal claims against the Exchange in connection
thereto.
BSTX Security Market Company Corporate Governance Affirmation
    In accordance with the proposed Rule 26800 Series, companies listed
on BSTX would be required to comply with certain corporate governance
standards, relating to, for example, audit committees, director
nominations, executive compensation, board composition, and executive
sessions. In certain circumstances the corporate governance standards
that apply vary depending on the nature of the company. In addition,
there are phase-in periods and exemptions available to certain types of
companies. The proposed BSTX Security Market Corporate Governance
Affirmation, submitted with this proposal as Exhibit 3K, enables a
company to confirm to the Exchange that it is in compliance with the
applicable standards, and specify any applicable phase-ins or
exemptions. Companies are required to submit a BSTX Security Market
Corporate Governance Affirmation upon initial listing on the Exchange
and thereafter when an event occurs that makes an existing form
inaccurate. This BSTX Security Market Corporate Governance Affirmation
assists the Exchange regulatory staff in monitoring listed company
compliance with the corporate governance requirements.
Sample Underwriter's Letter
    In accordance with proposed Rule 26101, an initial public offering
of a Security must meet certain listing requirements. The Exchange
seeks to require the issuer's underwriter to execute a letter setting
forth the details of the offering, including the name of the offering
and why the offering meets the criteria of the BSTX rules. This
information, set forth in the proposed Sample Underwriter's Letter and
submitted with this proposal as Exhibit 3L, is necessary to assist the
Exchange's regulatory staff in assessing the offering's compliance with
BSTX listing standards for an initial public offering of a Security.
Regulation
    In connection with the operation of BSTX, the Exchange will
leverage many of the structures it established to operate a national
securities exchange in compliance with Section 6 of the Exchange
Act.\317\ Specifically, the Exchange will extend its Regulatory
Services Agreement with FINRA to cover BSTX Participants and trading on
the BSTX System. This Regulatory Services Agreement will govern many
aspects of the regulation and discipline of BSTX Participants, just as
it does for options regulation. The Exchange will perform Security
listing regulation, authorize BSTX Participants to trade on the BSTX
System, and conduct surveillance of Security trading on the BSTX
System.
---------------------------------------------------------------------------

    \317\ 15 U.S.C. 78f.
---------------------------------------------------------------------------

    Section 17(d) of the Exchange Act \318\ and the related Exchange
Act rules permit SROs to allocate certain regulatory responsibilities
to avoid duplicative oversight and regulation. Under Exchange Act Rule
17d-1,\319\ the SEC designates one SRO to be the Designated Examining
Authority, or DEA, for each broker-dealer that is a member of more than
one SRO. The DEA is responsible for the financial aspects of that
broker-dealer's regulatory oversight. Because Exchange Participants,
including BSTX Participants, also must be members of at least one other
SRO, the Exchange would generally not be designated as the DEA for any
of its members.\320\
---------------------------------------------------------------------------

    \318\ 15 U.S.C. 78q(d).
    \319\ 17 CFR 240.17d-1.
    \320\ See Exchange Rule 2020(a) (requiring that a Participant be
a member of another registered national securities exchange or
association).
---------------------------------------------------------------------------

    Rule 17d-2 under the Exchange Act \321\ permits SROs to file with
the Commission plans under which the SROs allocate among each other the
responsibility to receive regulatory reports from, and examine and
enforce compliance with specified provisions of the Exchange Act and
rules thereunder and SRO rules by, firms that are members of more than
one SRO (``common members''). If such a plan is declared effective by
the Commission, an SRO that is a party to the plan is relieved of
regulatory responsibility as to any common member for whom
responsibility is allocated under the plan to another SRO. The Exchange
plans to join the Plan for the Allocation of Regulatory
Responsibilities Regarding Regulation NMS.\322\ The Exchange may choose
to join certain Rule 17d-2 agreements such as the agreement allocating
responsibility for insider trading rules.\323\
---------------------------------------------------------------------------

    \321\ 17 CFR 240.17d-2.
    \322\ Exchange Act Release No. 85046 (February 4, 2019), 84 FR
2643 (February 7, 2019).
    \323\ Exchange Act Release No. 84392 (October 10, 2018), 83 FR
52243 (October 16, 2018).
---------------------------------------------------------------------------

    For those regulatory responsibilities that fall outside the scope
of any Rule 17d-2 agreements that the Exchange may join, subject to
Commission approval, the Exchange will retain full regulatory
responsibility under the Exchange Act. However, as noted, the Exchange
will extend its existing Regulatory Services Agreement with FINRA to
provide that FINRA personnel will operate as agents for the Exchange in
performing certain regulatory functions with respect to BSTX. As is the
case with the Exchange's options trading platform, the Exchange will
supervise FINRA and continue to bear ultimate regulatory responsibility
for BSTX. Consistent with the Exchange's existing regulatory structure,
the Exchange's Chief Regulatory Officer shall have general supervision
of the regulatory operations of BSTX, including responsibility for
overseeing the surveillance, examination, and enforcement functions and
for administering all regulatory services agreements applicable to
BSTX. Similarly, the Exchange's existing Regulatory Oversight Committee
will be responsible for overseeing the adequacy and effectiveness of
Exchange's regulatory and self-regulatory organization
responsibilities, including

those applicable to BSTX. Finally, as it does with options, the
Exchange will perform automated surveillance of trading on BSTX for the
purpose of maintaining a fair and orderly market at all times and
monitor BSTX to identify unusual trading patterns and determine whether
particular trading activity requires further regulatory investigation
by FINRA.
    In addition, the Exchange will oversee the process for determining
and implementing trade halts, identifying and responding to unusual
market conditions, and administering the Exchange's process for
identifying and remediating ``clearly erroneous trades'' pursuant to
proposed Rule 25110.
NMS Plans
    The Exchange intends to join the Order Execution Quality Disclosure
Plan, the Plan to Address Extraordinary Market Volatility, the Plan
Governing the Process of Selecting a Plan Processor, and the applicable
plan(s) for consolidation and dissemination of market data. The
Exchange is already a participant in the NMS plan related to the
Consolidated Audit Trail. Consistent with Section 6(b)(5) of the
Exchange Act,\324\ the Exchange believes that joining the same set of
NMS plans that all other national securities exchanges that trade
equities must join fosters cooperation and coordination with other
national securities exchanges and other market participants engaged in
regulating, clearing, settling, processing information with respect to,
and facilitating transactions in securities.
---------------------------------------------------------------------------

    \324\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the provisions of the Exchange Act,\325\ in general and with
Section 6(b)(5) of the Exchange Act,\326\ in particular, in that it is
designed 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;
and it is not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers, or to regulate by virtue of
any authority conferred by this title matters not related to the
purposes of this title or the administration of the Exchange.
---------------------------------------------------------------------------

    \325\ 15 U.S.C. 78a et seq.
    \326\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that BSTX will benefit individual investors,
other market participants, and the equities market generally. The
Exchange proposes to establish BSTX as a facility of the Exchange that
would trade equities in a similar manner to how equities presently
trade on other exchanges. BSTX would also make available to BSTX
Participants the BSTX Market Data Blockchain, which provides certain
order and transaction information with respect to a BSTX Participant's
trading activity on BSTX, as well as anonymized order and transaction
data with respect to all trading activity occurring on BSTX. The
Exchange believes that the content of information available on the BSTX
Market Data Blockchain would generally be similar to TAQ data made
available by NYSE today, except that (i) the BSTX Market Data
Blockchain would use a private, permissioned network controlled by the
Exchange to make the market data available to BSTX Participants; (ii) a
BSTX Participant would be able to certain see non-anonymized
information about its own trading activity on BSTX; \327\ and (iii) the
BSTX Market Data Blockchain would include market data only with respect
to trading activity occurring on BSTX, while the Exchange understands
that TAQ data includes certain trading and quotation data that may
occur on other markets.\328\ The Exchange believes that the use of
blockchain technology, through a private permissioned network
accessible through an API that operates in manner that is fully
compatible with the existing regulatory structures for trading,
recordkeeping, and clearance and settlement that market participants
are familiar with is an appropriate way to introduce blockchain to the
current market structure. BSTX Participants would not have affirmative
obligations to provide information to the blockchain nor would they be
required to access or use it. The data inputs to the BSTX Market Data
Blockchain would be captured in the ordinary course as BSTX
Participants' orders and messages are sent to the Exchange through the
FIX gateway. The BSTX Market Data Blockchain, therefore, would be
optional functionality available to all BSTX Participants on equal
terms, and therefore is not unfairly discriminatory, consistent with
Section 6(b)(5) of the Exchange Act.\329\
---------------------------------------------------------------------------

    \327\ All non-anonymized information would be available only to
the BSTX Participant who provided such information to the Exchange
through its trading activity on BSTX.
    \328\ See e.g., NYSE, Daily TAQ Fact Sheet, (noting that TAQ
data ``provides users access to all trades and quotes for all issues
traded on NYSE, Nasdaq and the regional exchanges for a single
trading day'' and is ``a comprehensive history of daily activity
from NYSE markets and the U.S. Consolidated Tape covering U.S.
Equities instruments (CTA and UTP participating markets'') https://www.nyse.com/publicdocs/nyse/data/Daily_TAQ_Fact_Sheet.pdf.
    \329\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange has proposed to make anonymized General Market Data on
the BSTX Market Data Blockchain available to both BSTX Participants and
non-BSTX Participants through the same means of an API. Accordingly,
the Exchange believes that because General Market Data available on the
BSTX Market Data Blockchain would be available to both BSTX and non-
BSTX Participants, the BSTX Market Data Blockchain is not unfairly
discriminatory and does not impose a burden on competition, consistent
with Sections 6(b)(5) and 6(b)(8) of the Exchange Act.\330\ Non-BSTX
Participants would not be provided access to any Participant
Proprietary Data to protect the private trading information of each
BSTX Participant (and each BSTX Participant would only have access to
its own Participant Proprietary Data), which the Exchange believes is
consistent with Sections 6(b)(5) and 6(b)(8) of the Exchange Act
because providing the Participant Proprietary Data of a given BSTX
Participant to non-BSTX Participants (or other BSTX Participants) would
unfairly discriminate against the BSTX Participant whose information is
being shared and could place that BSTX Participant at an unfair
competitive disadvantage if its order and trading information were
shared with other market participants.
---------------------------------------------------------------------------

    \330\ 15 U.S.C. 78f(b)(5) and (8).
---------------------------------------------------------------------------

    In addition, because the BSTX Market Data Blockchain only captures
information with respect to trading activity on BSTX, it would have no
effect or impact on other exchanges, promoting consistency with Section
6(b)(8) of the Exchange Act, which prohibits an exchange's rules from
imposing a burden on competition not necessary or appropriate in
furtherance of the Exchange Act.\331\ The entry of an innovative
competitor such as BSTX seeking to implement a measured introduction of
blockchain technology in connection with the trading of equity
securities may promote competition by encouraging other market
participants to find ways of using blockchain technology in connection
with securities transactions. The proposed regulation of BSTX and BSTX
Participants, as well as the execution of

Securities using a price-time priority model and the clearance and
settlement of Securities pursuant to the rules, policies and procedures
of a registered clearing agency will all operate in a manner
substantially similar to existing equities exchanges. In this way, the
Exchange believes that BSTX provides a robust regulatory structure that
protects investors and the public interest while introducing the use of
blockchain technology as an additional feature in connection with
Securities traded on the Exchange.
---------------------------------------------------------------------------

    \331\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    In connection with the clearance and settlement of Securities
pursuant to the rules, policies and procedures of a registered clearing
agency, the Exchange proposes that BSTX Participants would be able to
include in their orders in Securities that are submitted to BSTX
certain parameters to indicate a preference for settlement on a same
day (T+0) or next trading day (T+1) basis when certain conditions are
met.\332\ Any such orders would at the time of order entry represent
orders that would be regular-way and would be presumed to settle on a
T+2 basis just like any other order submitted by a BSTX Participant
that does not include a parameter indicating a preference for faster
settlement. As described in greater detail above, however, an Order
with a T+0 Preference or an Order with a T+1 Preference would only
result in executions that would actually settle more quickly than on a
T+2 basis if, and only if, all of the conditions in Rule 25060(h) are
met and the execution that is transmitted to NSCC is eligible for T+0
or T+1 settlement under the rules, policies and procedures of a
registered clearing agency.\333\ Any such preference included by a BSTX
Participant would only become operative if the order happens to execute
against another order from a BSTX Participant that also includes a
parameter indicating a preference for settlement on a T+0 or T+1 basis.
---------------------------------------------------------------------------

    \332\ See proposed Rule 25060(h).
    \333\ See proposed Rule 25100(d).
---------------------------------------------------------------------------

    The Exchange believes that the proposed ability for BSTX
Participants to indicate a preference for shorter settlement times as
described above is consistent with the Exchange Act and in particular
Section 6(b)(5) of the Exchange Act because it would help remove
impediments to and perfect the mechanism of a free and open market and
is not designed to permit unfair discrimination between or among market
participants.\334\ Specifically, allowing for BSTX Participants to
potentially reduce the settlement time for transactions on BSTX
pursuant to the rules, policies and procedures of a registered clearing
agency helps remove impediments to and perfects a free and open market
by allowing greater choice for BSTX Participants who may want to avail
themselves of currently available functionality at registered clearing
agencies. Moreover, the Commission has previously noted a number of
positive effects relating to the liquidity risks and costs faced by
members in a clearing agency, and the Exchange believes that this
proposed functionality on BSTX would help realize such positive
effects.\335\ Proposed Rule 25060(h) is not designed to permit unfair
discrimination between market participants consistent with Section
6(b)(5) \336\ because the Rule would allow all orders that are
marketable against one another--regardless of the settlement preference
of the BSTX Participant submitting the order (or their customer)--to
execute against each other. A BSTX Participant that would like
settlement of T+2 could still interact with orders on BSTX that
indicate a preference for a shorter settlement cycle and vice-versa
and, in all cases, the trade would settle pursuant to the rules,
policies and procedures of a registered clearing agency. Only where two
orders that both indicate a preference for a shorter settlement cycle
match on BSTX would a shorter settlement cycle be possible pursuant to
the rules, policies and procedures of a registered clearing agency.
---------------------------------------------------------------------------

    \334\ 15 U.S.C. 78f(b)(5).
    \335\ See supra notes 75-78 and accompanying text.
    \336\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Exchange Act.\337\
The Exchange operates in an intensely competitive global marketplace
for transaction services. The Exchange competes for the privilege of
providing market services to broker-dealers through the Exchange's
service offerings and associated benefits it is able to provide. The
Exchange's ability to compete in this environment is based in large
part on the quality of its trading systems, the overall quality of its
market and its attractiveness to market participants who evaluate the
Exchange on, among other things, speed, reliability, the likelihood and
costs of executions, as well as spreads, fairness, and transparency.
---------------------------------------------------------------------------

    \337\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    The Exchange believes that the primary areas where the proposed
rule change could potentially result in a burden on competition are
with regard to the terms on which: (1) Issuers may list their
securities for trading, (2) market participants may access BSTX as a
facility of the Exchange and use its services including the BSTX Market
Data Blockchain, (3) Security transactions may be cleared and settled,
(4) Security transactions would occur OTC (5) Security transactions
would occur on other exchanges through an extension of UTP to
Securities.
    Regarding considerations (1) and (2), and as described in detail in
Item 3 above, the BSTX Rules are drawn substantially from the existing
rules of other exchanges that the Commission has already found to be
consistent with the Exchange Act, including regarding whether they
impose any burden on competition that is not necessary or appropriate
in furtherance of its purposes. For example, the BSTX Non-ETP Listing
Rules in the 26000 Series and Suspension and Delisting Rules in the
27000 Series that affect issuers and their ability to list Securities
for trading are based substantially on the current rules of NYSE
American. Additionally, the BSTX Trading and Listing of ETPs Rules in
the 28000 Series that concern issuers and their ability to list
Securities that are exchange-traded products are based substantially on
the current rules of NYSE Arca. Additionally, the BSTX Rules regarding
membership and access to and use of the facilities of BSTX are also
substantially based on existing exchange rules. Specifically, the
relevant BSTX Rules are as follows: Participation on BSTX (Rule 18000
Series); business conduct for BSTX Participants (Rule 19000 Series);
financial and operational rules for BSTX Participants (Rule 20000
Series); supervision (Rule 21000 Series); miscellaneous provisions
(Rule 22000 Series); trading practices (Rule 23000 Series); discipline
and summary suspension (Rule 24000 Series); trading (Rule 25000
Series); market making (Rule 25200 Series); and dues, fees,
assessments, and other charges (Rule 28000 [sic] Series). As described
in detail in Item 3, these rules are substantially based on analogous
rules of the following exchanges, as applicable: BOX; Investors
Exchange LLC; Cboe BZX Exchange, Inc.; The Nasdaq Stock Market LLC; and
NYSE American LLC.
    Regarding consideration (2) and use of the BSTX Market Data
Blockchain, the terms on which BSTX would operate

the BSTX Market Data Blockchain under Rule 17020 would apply equally to
all BSTX Participants (and non-BSTX Participants accessing anonymized
General Market Data) and would therefore not impose any different
burden on one BSTX Participant compared to another (or between and
among non-BSTX Participants). As described in detail in Item 3, BSTX
would issue login credentials to each BSTX Participant or non-BSTX
Participant through which users may access the BSTX Market Data
Blockchain. Accessing the BSTX Market Data Blockchain would not be
required. If a BSTX Participant chooses to access the BSTX Market Data
Blockchain, it would be able to see its order and transaction
information on BSTX as well as anonymized General Market Data from
other BSTX Participants and a non-BSTX Participant would only be able
to see the anonymized General Market Data. Because the General Market
Data would be anonymized, the Exchange believes that there would not be
cause for concern regarding potential trading information leakage or
the ability for a BSTX Participant to reverse engineer another BSTX
Participant's trading strategies.\338\ Moreover, the BSTX Market Data
Blockchain would not require any affirmative action on the part of a
BSTX Participant for its information to be recorded to the BSTX Market
Data Blockchain. Rather the Exchange would control all aspects of the
BSTX Market Data Blockchain as a private, permission-based blockchain
accessible to BSTX Participants, and the BSTX Market Data Blockchain
would capture order and execution activity that occurs in the normal
course on BSTX and is made available to BSTX Participants (and non-BSTX
Participants with respect to anonymized General Market Data) as an
additional resource that they may use in their discretion. The BSTX
Market Data Blockchain would functionally provide market data similarly
to what NYSE offers through TAQ data, but would simply provide it using
distributed ledger technology. Accordingly, although capturing a
different set of market data than captured by NYSE TAQ data, the BSTX
Market Data Blockchain is pro-competitive by offering a similar type of
market data and using an innovative technology to do so. For these
reasons, the Exchange believes that the BSTX Market Data Blockchain
would not impose any burden on competition.
---------------------------------------------------------------------------

    \338\ Non-BSTX Participants accessing the BSTX Market Data
Blockchain would have access to the same anonymized General Market
Data as BSTX Participants. While a non-BSTX Participant would be
treated differently than a BSTX Participant in that they would not
be able to access any proprietary market data of a BSTX Participant,
the reason for this difference is to prevent a non-BSTX Participant
from being able to see the confidential trading information of a
BSTX Participant. If the Exchange were to provide non-BSTX
Participants with access to one or more BSTX Participants'
proprietary market data, the Exchange would impose an undue burden
on competition against BSTX Participants whose confidential trading
information would be shared. Accordingly, non-BSTX Participants may
only access anonymized, General Market Data.
---------------------------------------------------------------------------

    In addition to not imposing any burden on competition, the Exchange
believes that the BSTX Market Data Blockchain would provide two primary
benefits to BSTX Participants. First, the Exchange believes that BSTX
Participants that choose to access the BSTX Market Data Blockchain may
find the information useful as a focused source of market data
regarding order and transaction information on BSTX.\339\ Second, the
Exchange believes that the BSTX Market Data Blockchain would help
familiarize BSTX Participants that access the market data with the
capabilities of blockchain technology in a manner that does not impose
any burden on competition on them or others. The Commission has stated
that it is ``mindful of the benefits of increasing use of new
technologies for investors and the markets, and has encouraged
experimentation and innovation . . .'' stating further that
``[i]nformation and communications technologies are critical to healthy
and efficient primary and secondary markets.'' \340\ Regarding the
judgment of whether the benefits of certain technologies are
meritorious, the Commission has explained its view that ``[t]he market
will ultimately prove the worth of technology--whether the benefits to
the industry and its investors of developing and using new services are
greater than the associated costs.'' \341\ Consistent with these
statements, the Exchange believes that promoting use of the
functionality of blockchain technology through the BSTX Market Data
Blockchain will allow BSTX Participants to observe and increase their
familiarity with the capabilities and potential benefits of blockchain
technology in a context that operates within the current equity market
infrastructure and thereby advances and protects the public's interest
in the use and development of new data processing techniques that may
create opportunities for more efficient, effective and safe securities
markets.\342\
---------------------------------------------------------------------------

    \339\ For example, a BSTX Participant may wish to use the market
data to review its trading activity on BSTX, determine what the
market quality was at a particular time for a given Security or to
evaluate execution quality on BSTX.
    \340\ See supra n. 52-54 and accompanying text.
    \341\ Id.
    \342\ See supra n.55 and accompanying text.
---------------------------------------------------------------------------

    Regarding consideration (3) and the manner in which Security
transactions may be cleared and settled, the Exchange proposes under
BSTX Rule 25100(d) to clear and settle transactions in Securities in
accordance with the rules, policies and procedures of a registered
clearing agency. The Exchange believes that this is consistent with how
other exchange-listed equity securities are cleared and settled today.
Therefore, BSTX's rules regarding clearance and settlement of Security
transactions do not impose any relative burden on competition regarding
the manner in which trades may be cleared and settled because market
participants would be able to clear and settle Security transactions in
the same manner as they already do in other types of NMS stock. The
Exchange believes that this is equally true regarding the proposed
ability of BSTX Participants to submit to BSTX orders in Securities in
which they include a parameter expressing a preference for T+1 or T+0
settlement, consistent with the rules, policies and procedures of a
registered clearing agency, as proposed in the operation of proposed
BSTX Rules 25060(h) and 25100(d). As described in detail in Item 3
above, BSTX believes that NSCC and DTC already have authority under
their rules policies and procedures to clear and settle certain trades
on a T+1 or T+0 basis and that these clearing agencies do already clear
and settle trades in accordance with this authority.
    The Exchange believes that answering the question of whether a
burden on competition is imposed by the proposal to allow BSTX
Participants to specify an order parameter indicating a preference for
potential settlement on a T+0 or T+1 basis requires an assessment under
three general circumstances for order submissions and executions. The
first possible circumstance contemplates orders that BSTX Participants
would submit to the BSTX System and that would result in an execution
on BSTX. Here, it would be entirely the choice of any BSTX Participant
regarding whether to include an order parameter indicating a preference
for T+0 or T+1 settlement where possible under the settlement logic in
BSTX Rule 25060(h) and subject to functionality permitted by the rules,
policies and procedures of a registered clearing agency. If no such
additional parameter is included in the order or the matched orders are
not eligible for shortened settlement pursuant to the rules, policies
and procedures of a

registered clearing agency (e.g., the trade is not received by NSCC for
T+0 clearance and settlement through NSCC's contiuous net settlement
system in advance of the applicable cut-off time), the order defaults
to settle on a regular-way T+2 basis under the settlement logic in
proposed BSTX Rule 25060(h). As described in Part II.H of Item 3, an
order that includes a parameter indicating a preference for potential
T+0 settlement will execute against any order against which it is
marketable and BSTX will transmit the matched order information to a
registered clearing agency for settlement on a standard settlement
cycle of T+2 except where: (i) The order with the parameter for
potential settlement on T+0 executes against another order with a
parameter for potential settlement on T+0 (in which case BSTX will
transmit the matched order information to a registered clearing agency
for settlement on the trade date if the transaction is also eligible
for settlement on T+0 under the rules, policies and procedures of a
registered clearing agency) or (ii) the order with a parameter for
potential settlement on T+0 executes against an order with a parameter
for potential settlement on T+1 (in which case BSTX will transmit the
matched order information to a registered clearing agency for
settlement on T+1 if the transaction is also eligible for settlement on
T+1 under the rules, policies and procedures of a registered clearing
agency). Similarly, as proposed, an order that includes a parameter for
potential settlement on T+1 will execute against any order against
which it is marketable and BSTX will transmit the matched order
information to a registered clearing agency for settlement on standard
settlement cycle of T+2 except where an order that includes a parameter
for potential settlement on T+1 executes against another such order or
an order that includes a parameter for potential settlement on T+0 (in
which case BSTX will transmit the matched order information to a
registered clearing agency for settlement on T+1 if the transaction is
also eligible for settlement on T+1 under the rules, policies and
procedures of a registered clearing agency). In all cases under the
settlement logic in proposed BSTX Rule 25060(h), an order that does not
include an optional parameter indicating a preference for potential
settlement on T+0 or T+1 would be a regular way order that would always
receive T+2 settlement if it executes against any other order in the
BSTX System. In this way, all of the orders submitted to BSTX would be
regular way orders that in and of themselves would be presumed to
settle on T+2. Only where a BSTX Participant includes the optional
parameters to express a preference for potential T+0 or T+1 settlement
(where consistent with and eligible for shortened settlement under the
rules, policies and procedures of a registered clearing agency) and the
order matches against another order seeking a shorter settlement time
than T+2 could a transaction settle more quickly than T+2 under the
settlement logic in proposed BSTX Rule 25060(h) and as described
immediately above. Thus, every market participant seeking T+2
settlement for an execution on BSTX would be able to interact with any
order against which their order is marketable, including those marked
for possible T+0 or T+1 settlement. In addition, the possibility of
shortened settlement timing would have no impact on the Exchange's
price time priority.\343\ For these reasons, the Exchange believes that
no burden on competition is imposed in this first possible
circumstance.
---------------------------------------------------------------------------

    \343\ See supra n.62 and accompanying text.
---------------------------------------------------------------------------

    The second possible circumstance arises when an order that would be
required under Exchange Act Rule 611,\344\ the Commission's ``order
protection rule'', to be routed to BSTX from a third party exchange
that extends UTP to a Security. This required routing of the order in
such a Security would occur in this setting because the NBBO existed on
BSTX at the time of the entry of the order. Under proposed BSTX Rule
25060(h), the order routed to BSTX would execute against any order
against which it is marketable without regard to whether a BSTX
Participant may have included an optional parameter for potential T+0
or T+1 settlement where the order executes against another order that
also has an optional parameter for potential T+0 or T+1 settlement
under the settlement logic in BSTX Rule 25060(h). In the event the
order routed to BSTX executes against another order on BSTX against
which it is marketable, that executed transaction in the Security would
be bound for regular way T+2 settlement under BSTX Rule 25060(h)
because the Exchange believes that the routed order from a third party
exchange would not include a parameter for T+0 or T+1 settlement. This
is because the Exchange believes that no other exchange currently
includes any such optional parameters to be able to indicate a
preference for potential T+0 or T+1 settlement. This structure means
that any non-BSTX Participant that sees a quote in a Security on BSTX
would remain able to execute against that quote even if that quote
includes an optional parameter indicating a preference for T+0 or T+1
settlement where an executed order becomes eligible for any such
settlement on a basis that is faster that T+2 under the settlement
logic in BSTX Rule 25060(h). The Exchange believes that no burden on
competition results in this second possible circumstance because an
order routed to BSTX would interact against any order on BSTX against
which it is marketable. All orders in a Security that are submitted
directly to BSTX by BSTX Participants or that may be routed to BSTX
would be regular way orders that when viewed in isolation would be
presumed to settle on a T+2 basis at the time of order entry. It would
only be upon execution against another order that also includes an
order parameter expressing a preference for settlement on a T+0 or T+1
basis that the executed transaction (i.e., not the initial orders)
would become eligible for settlement faster than T+2 under the
settlement logic in Rule 25060(h) pursuant to the rules, policies and
procedures of a registered clearing agency. The Exchange believes this
imposes no burden on competition on BSTX Participants because inclusion
of any T+0 or T+1 parameter would be entirely optional and any BSTX
Participant that includes such a parameter would do so with an ex-ante
understanding of the settlement logic in BSTX Rule 25060 that could
cause an executed transaction to settle more quickly that T+2. As
noted, the Exchange believes that orders in a Security that would be
required to be routed to BSTX, for example under the Commission's Order
Protection Rule, would also not impose any burden on competition
because other exchanges do not have rules that similarly contemplate
the inclusion of a T+0 or T+1 parameter, such routed orders would
therefore result in T+2 settlement if executed against any other order
on BSTX against which the order is marketable (regardless of whether
the order against which it executes includes an optional parameter
indicating a preference for T+0 or T+1 settlement). Therefore, any
order routed to BSTX would be able to interact with any other order on
BSTX against which it is marketable and would settle on a regular way
T+2 basis just as occurs today regarding any order in an NMS stock that
is routed to a national securities exchange.
---------------------------------------------------------------------------

    \344\ 17 CFR 242.611.
---------------------------------------------------------------------------

    The third possible circumstance contemplates an order that must be
routed under the order protection rule from BSTX to a third party
exchange

that extends UTP for a Security because the third party exchange has
the NBBO at that time. The Exchange believes that this setting is not
relevant under the proposed rules of BSTX. Specifically, the Exchange
believes that it is not relevant because proposed BSTX Rule 25130(d)
states that the BSTX System will reject any order or quotation that
would lock or cross a protected quotation of another exchange at the
time of entry. Therefore, any such orders that would otherwise be
required to be routed by BSTX to another exchange will instead be
rejected by the BSTX System. Accordingly, any specification by a BSTX
Participant of a T+0 or T+1 settlement timing parameter for an order in
this setting could not create any burden on competition because the
order will be rejected and would never lead to an execution.
    In addition to not imposing any burden on competition, the Exchange
believes that allowing BSTX Participants to use faster settlement
cycles where consistent with the rules, policies and procedures of a
registered clearing agency would mitigate settlement risk for
transactions in such Securities, consistent with the benefits the
Commission has noted in this area. Namely, in adopting amendments to
SEC Rule 15c6-1 in 2017 to shorten the standard settlement cycle for
most broker-dealer transactions in securities from T+3 to T+2, the
Commission stated its belief that the shorter settlement cycle would
have positive effects regarding the liquidity risks and costs faced by
members in a clearing agency, like NSCC, that performs CCP services,
and that it would also have positive effects for other market
participants. Specifically, the Commission stated its belief that the
resulting ``reduction in the amount of unsettled trades and the period
of time during which the CCP is exposed to risk would reduce the amount
of financial resources that the CCP members may have to provide to
support the CCP's risk management process . . .'' and that ``[t]his
reduction in the potential need for financial resources should, in
turn, reduce the liquidity costs and capital demands clearing broker-
dealers face . . . and allow for improved capital utilization.'' \345\
The Commission went on to state its belief that shortening the
settlement cycle ``would also lead to benefits to other market
participants, including introducing broker-dealers, institutional
investors, and retail investors'' such as ``quicker access to funds and
securities following trade execution'' and ``reduced margin charges and
other fees that clearing broker-dealers may pass down to other market
participants[.]'' \346\ The Commission also ``noted that a move to a
T+1 standard settlement cycle could have similar qualitative benefits
of market, credit, and liquidity risk reduction for market
participants[.]'' \347\ The Exchange agrees with these statements by
the Commission and has therefore proposed BSTX Rule 25100(d) in a form
that would promote the benefits of shorter settlement cycles for
Securities without imposing burdens on other national securities
exchanges or market participants that are not BSTX Participants.
---------------------------------------------------------------------------

    \345\ See supra n.75-78 and accompanying text.
    \346\ Id.
    \347\ Id.
---------------------------------------------------------------------------

    With respect to consideration (4) above, as previously noted,
market participants would not be limited in their ability to trade
Securities OTC because Securities could be traded OTC and would be
cleared and settled in the same manner as other NMS stocks through the
facilities of a registered clearing agency. Thus, the Exchange does not
believe that its proposal will place any new burden on competition with
respect to OTC trading, given that trading, clearance and settlement
will take place in the same manner as for other NMS stocks.
    With respect to consideration (5) noted above regarding other
exchanges extending UTP to Securities, the Exchange does not believe
that the proposed Rules would impose a burden on competition that is
not necessary or appropriate in furtherance of the purposes of the
Exchange Act. This is because other national securities exchanges would
be able to extend UTP to Securities in accordance with Commission rules
just as they can regarding any other NMS stock.

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. Summary of the Comment Letters Received

    Several commenters express support for the proposal's proposed use
of a shortened settlement cycle under certain circumstances.\348\ One
commenter states in support of the proposal that the proposed BSTX
exchange would provide significant advantages over existing exchanges
by providing fairer conditions to market participants through reduced
settlement times and more transparency.\349\ This commenter states that
T+0 settlement would improve market conditions for retail investors by
reducing risk of failure to deliver on highly shorted stocks, and would
reduce actual and opportunity costs by eliminating margin lending for
the period before settlement and lost opportunities to reinvest.\350\
Two commenters refer to recent problems that they characterize as
arising from T+2 settlement and short selling,\351\ and state that the
proposal for a shorter settlement cycle would level the playing field
for retail investors.\352\
---------------------------------------------------------------------------

    \348\ See Letter from Meagan Darata, Utah Salt Supplements (June
21, 2021) (``Darata Letter''); Letter from Mark Nelson (June 10,
2021) (``Nelson Letter''); Letter from Robert Shaw (June 11, 2021)
(``Shaw Letter''); Letter from Neil Skinner (June 11, 2021)
(``Skinner Letter'').
    \349\ See Nelson Letter, supra note 348.
    \350\ See id. This commenter also states that the commenter
expects the reduced costs of operating the exchange to be passed on
to prospective companies and issuers, thereby creating more
opportunities for companies and asset holders to offer securities,
and resulting in a market boom as new market participants join the
exchange. See id.
    \351\ See Letter from Anonymous (June 15, 2021) (``Anonymous
Letter I''); Skinner Letter, supra note 348. See also Shaw Letter,
supra note 348 (stating that, with the current issues regarding
settlement time, the proposal to offer speedy settlement is one
answer to improving the system).
    \352\ See Anonymous Letter I, supra note 351; Skinner Letter,
supra note 348. See also Darata Letter, supra note 348 (stating that
there is a wide power differential between retail and institutional
traders).
---------------------------------------------------------------------------

    One commenter states that the United States should support
blockchain technologies like BSTX to be competitive globally, and that
blockchain affords more efficiency and transparency.\353\ Another
commenter states that blockchain will bring the advantages of better
security, higher transparency, more trust, and a fairer marketplace to
the sector.\354\ This commenter also states that blockchain would
afford savings in time and money, make the market safer against fraud,
and help United States markets keep up with other global systems.\355\
Another commenter states that it would like to see the development of
financial institutions and securities exchanges that allow access to
financial instruments and investments without the burdens and controls
placed by traditional exchanges, and that the proposal represents the
first steps in a free and equitable publicly auditable financial
system.\356\
---------------------------------------------------------------------------

    \353\ See Letter from Anonymous (June 15, 2021) (``Anonymous
Letter II'').
    \354\ See Letter from Anonymous (June 21, 2021).
    \355\ See id.
    \356\ See Letter from Tyler Hess (June 17, 2021).
---------------------------------------------------------------------------

    Finally, one commenter states that the proposal does not
specifically address how participants shall access BSTX and

that, by comparison, with respect to the trading of options, the
Exchange does not currently enforce equidistant cabling among and
between participants and its matching engine located in the same data
center.\357\ This commenter states that, absent confirmation that
access to BSTX will be offered on an equal and non-discriminatory
basis, the commenter urges the Commission to disapprove the
proposal.\358\ In response, the Exchange states that BSTX will provide
for equidistant cabling arrangements to ensure that all co-located BSTX
Participants are on a level playing field in connecting to the BSTX
matching engine.\359\ The Exchange also states that BSTX plans to have
equidistant cabling arrangements within the area of the data center
that it controls, and that it will make technical details regarding
those arrangements available to prospective BSTX Participants in
certain specification documents after approval of BSTX as a new
facility of the Exchange.\360\
---------------------------------------------------------------------------

    \357\ See Letter from Andrew Stevens, General Counsel, IMC
Chicago, LLC and Richard McDonald, Compliance Coordinator,
Susquehanna International Group, LLP (June 28, 2021), at 2.
    \358\ See id. at 3.
    \359\ See Letter from Lisa J. Fall, President, BOX Exchange LLC
(July 1, 2021), at 1.
    \360\ See id. at 2. The Exchange states that its options trading
platform is an entirely separate facility of the Exchange with a
separate ownership structure from BSTX, and BSTX will use separate
data center operations and a different technology provider. See id.
at 3.
---------------------------------------------------------------------------

IV. Proceedings To Determine Whether To Approve or Disapprove SR-BOX-
2021-06, as Modified by Amendment No. 1, and Grounds for Disapproval
Under Consideration

    The Commission is instituting proceedings pursuant to Section
19(b)(2)(B) of the Act \361\ to determine whether the proposed rule
change, as modified by Amendment No. 1, should be approved or
disapproved. Institution of such proceedings is appropriate at this
time in view of the legal and policy issues raised by the proposed rule
change. Institution of proceedings does not indicate that the
Commission has reached any conclusions with respect to any of the
issues involved. Rather, as described below, the Commission seeks and
encourages interested persons to provide additional comment on the
proposed rule change to inform the Commission's analysis of whether to
approve or disapprove the proposed rule change, as modified by
Amendment No. 1.
---------------------------------------------------------------------------

    \361\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

    Pursuant to Section 19(b)(2)(B) of the Act,\362\ the Commission is
providing notice of the grounds for disapproval under consideration. As
described above, the Exchange proposes to adopt rules to govern the
trading of equity securities on the Exchange through the BSTX facility.
Among other things, the Exchange proposes to operate the BSTX Market
Data Blockchain and to submit trades to NSCC for settlement on a T+0 or
T+1 basis under certain conditions. As stated above, the Commission has
received comment letters on the proposal and a response letter from the
Exchange. Moreover, on August 18, 2021, the Exchange filed Amendment
No. 1 to the proposed rule change. The Commission is instituting
proceedings to allow for additional analysis of, and input from
commenters with respect to, the consistency of the proposed rule
change, as modified by Amendment No. 1, with the Act and, in
particular, with Section 6(b)(5) of the Act, which requires, among
other things, that the rules of a national securities 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
to protect investors and the public interest, and not be designed to
permit unfair discrimination between customers, issuers, brokers, or
dealers; \363\ Section 6(b)(7) of the Act, which requires that the
rules of a national securities exchange provide a fair procedure for
the prohibition or limitation by the exchange of any person with
respect to access to services offered by the exchange; \364\ and
Section 6(b)(8) of the Act, which requires that the rules of a national
securities exchange not impose any burden on competition not necessary
or appropriate in furtherance of the purposes of the Act.\365\
---------------------------------------------------------------------------

    \362\ Id.
    \363\ 15 U.S.C. 78f(b)(5).
    \364\ 15 U.S.C. 78f(b)(7).
    \365\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    The Exchange proposes to make available the BSTX Market Data
Blockchain, which would operate as a private, permission-based
blockchain that would be accessible through an API available through
the internet. Through use of the API, BSTX Participants would be able
to see detailed information about their own trading activity on BSTX
and anonymized, general information with respect to the trading
activity of other BSTX Participants.\366\ Non-BSTX Participants
permissioned by the Exchange would be able to view only the anonymized,
general market data through login credentials provided by the Exchange,
although it is not clear what conditions, if any, the Exchange may
place on non-BSTX Participants before granting this access.\367\ The
Exchange proposes to post information to the BSTX Market Data
Blockchain on a delayed basis of at least five minutes. This five
minute delay distinguishes the BSTX Market Data Blockchain from sources
of real-time market data, but is much shorter than the delay used by
other historical market data products, such as the New York Stock
Exchange's TAQ data, to which the Exchange draws a comparison.\368\ The
Exchange states that posting five minute blocks of data would allow the
Exchange to accrue sufficient information to record to the BSTX Market
Data Blockchain.\369\ The Commission believes there are questions as to
whether the Exchange's proposed use of the BSTX Market Data Blockchain
is consistent with Sections 6(b)(5), 6(b)(7), and 6(b)(8) of the Act,
and, in particular, the requirements that the rules of the Exchange be
designed to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and
a national market system, and to protect investors and the public
interest, and not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers; provide a fair procedure for
the prohibition or limitation by the Exchange of any person with
respect to access to services offered by the Exchange; and not impose
any burden on competition not necessary or appropriate in furtherance
of the purposes of the Act.
---------------------------------------------------------------------------

    \366\ The Exchange states that BSTX Participants may find the
BSTX Market Data Blockchain useful to review their trading activity
on BSTX, determine what the market for a given Security was at a
particular time, evaluate execution quality on BSTX, help confirm
the accrual of internal trading data, or back test trading
strategies. See Amendment No. 1, supra note 6, at 27.
    \367\ See id. at 18-20. The Exchange states that non-BSTX
Participants may find the data useful for academic study. See id. at
27.
    \368\ See id. at 17, 22 n.35, 128. The New York Stock Exchange's
TAQ data is produced as a daily file that becomes available after
the close of U.S. equities markets on the same day. See New York
Stock Exchange, Daily TAQ Client Specifications (August 31, 2020),
available at https://www.nyse.com/publicdocs/nyse/data/Daily_TAQ_Client_Spec_v3.3a.pdf.
    \369\ See Amendment No. 1, supra note 6, at 23 n.37.
---------------------------------------------------------------------------

    In addition, the Exchange proposes to allow BSTX Participants to
utilize an order parameter to indicate a preference

for settlement on a T+0 or T+1 basis. An executed trade would settle
more quickly than on a T+2 basis if certain conditions are met and the
execution is eligible for T+0 or T+1 settlement under the rules,
policies, and procedures of a registered clearing agency. According to
the Exchange, NSCC has authority under its rules, policies, and
procedures to clear certain trades on a T+0 or T+1 basis, and NSCC does
clear trades in accordance with this authority.\370\ The Exchange also
states that certain industry participants have announced plans to
collaborate to help the industry to reduce the standard settlement
cycle from T+2 to T+1.\371\ The Exchange states that it believes that
no other national securities exchange currently includes in its rules
optional parameters that allow market participants to indicate a
preference for potential T+0 or T+1 settlement.\372\ The Exchange has
provided information regarding trades that NSCC clears on a T+0 or T+1
basis, but has not indicated whether these trades involved exchange-
traded NMS stocks.\373\ It is also unclear whether not having certainty
that an order would receive faster settlement at the time of order
entry would reduce the ability of a market participant to reap the
potential benefits of faster settlement. Further, the Exchange has not
addressed whether introducing the possibility for T+0 or T+1 settlement
for on-exchange trades in NMS stocks pursuant to the rules of a single
national securities exchange, at a time when the industry standard is
still T+2 settlement, might have any adverse market effects.
Accordingly, the Commission believes that there are questions as to
whether the Exchange's proposal to provide BSTX Participants with the
ability to preference T+0 or T+1 settlement is consistent with Sections
6(b)(5) and 6(b)(8) of the Act, including the requirements that the
rules of the Exchange be designed 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 to protect
investors and the public interest; and not impose any burden on
competition not necessary or appropriate in furtherance of the purposes
of the Act.
---------------------------------------------------------------------------

    \370\ See id. at 31.
    \371\ See id. at 34-35.
    \372\ See id. at 140.
    \373\ See id. at 34.
---------------------------------------------------------------------------

    Under the Commission's Rules of Practice, the ``burden to
demonstrate that a proposed rule change is consistent with the Exchange
Act and the rules and regulations issued thereunder . . . is on the
[SRO] that proposed the rule change.'' \374\ The description of a
proposed rule change, its purpose and operation, its effect, and a
legal analysis of its consistency with applicable requirements must all
be sufficiently detailed and specific to support an affirmative
Commission finding,\375\ and any failure of an SRO to provide this
information may result in the Commission not having a sufficient basis
to make an affirmative finding that a proposed rule change is
consistent with the Act and the applicable rules and regulations.\376\
---------------------------------------------------------------------------

    \374\ 17 CFR 201.700(b)(3).
    \375\ See id.
    \376\ See id.
---------------------------------------------------------------------------

    For these reasons, the Commission believes it is appropriate to
institute proceedings pursuant to Section 19(b)(2)(B) of the Act to
determine whether the proposal, as modified by Amendment No. 1, should
be approved or disapproved.

V. Procedure: Request for Written Comments

    The Commission requests that interested persons provide written
submissions of their views, data, and arguments with respect to the
issues identified above, as well as any other concerns they may have
with the proposal. In particular, the Commission invites the written
views of interested persons concerning whether the proposal, as
modified by Amendment No. 1, is consistent with Sections 6(b)(5),\377\
6(b)(7),\378\ and 6(b)(8) \379\ of the Act or any other provision of
the Act, or the rules and regulations thereunder. Although there do not
appear to be any issues relevant to approval or disapproval that would
be facilitated by an oral presentation of views, data, and arguments,
the Commission will consider, pursuant to Rule 19b-4 under the
Act,\380\ any request for an opportunity to make an oral
presentation.\381\
---------------------------------------------------------------------------

    \377\ 15 U.S.C. 78f(b)(5).
    \378\ 15 U.S.C. 78f(b)(7).
    \379\ 15 U.S.C. 78f(b)(8).
    \380\ 17 CFR 240.19b-4.
    \381\ Section 19(b)(2) of the Act, as amended by the Securities
Act Amendments of 1975, Pub. L. 94-29 (June 4, 1975), grants the
Commission flexibility to determine what type of proceeding--either
oral or notice and opportunity for written comments--is appropriate
for consideration of a particular proposal by a self-regulatory
organization. See Securities Act Amendments of 1975, Senate Comm. on
Banking, Housing & Urban Affairs, S. Rep. No. 75, 94th Cong., 1st
Sess. 30 (1975).
---------------------------------------------------------------------------

    Interested persons are invited to submit written data, views, and
arguments regarding whether the proposal, as modified by Amendment No.
1, should be approved or disapproved by September 23, 2021. Any person
who wishes to file a rebuttal to any other person's submission must
file that rebuttal by October 7, 2021.
    The Commission asks that commenters address the sufficiency of the
Exchange's statements in support of the proposal, which are set forth
in Amendment No. 1,\382\ in addition to any other comments they may
wish to submit about the proposed rule change.
---------------------------------------------------------------------------

    \382\ See Amendment No. 1, supra note 6.
---------------------------------------------------------------------------

    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_ADDRESS>Please include
File Number SR-BOX-2021-06 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-2021-06. 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-BOX-2021-06 and should be
submitted by September 23, 2021. Rebuttal comments should be submitted
by October 7, 2021.
---------------------------------------------------------------------------

    \383\ 17 CFR 200.30-3(a)(57).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\383\
Vanessa A. Countryman,
Secretary.
[FR Doc. 2021-18947 Filed 9-1-21; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 85, Number 141 (Wednesday, July 22, 2020)]
[Notices]
[Pages 44304-44305]
[FR Doc No: 2020-15771]

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

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2020-N-1450]

Electronic Submissions; Data Standards; Support for the
International Institute of Electrical and Electronics Engineers
Bioinformatics Computations and Analyses Standard for Bioinformatic
Workflows

AGENCY: Food and Drug Administration, Health and Human Services (HHS).

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration (FDA or Agency) is announcing
support for use in regulatory submissions the current version of the
International Institute of Electrical and Electronics Engineers (IEEE)
bioinformatics computations and analyses standard for bioinformatic
workflows (BioCompute) and an update to include this standard in the
FDA Data Standards Catalog for the submission of high-throughput
sequencing (HTS) data in new drug applications (NDAs), abbreviated new
drug applications (ANDAs), biologics license applications (BLAs), and
investigational new drug applications (INDs) to the Center for
Biologics Evaluation and Research (CBER), Center for Drug Evaluation
and Research (CDER), and Center for Food Safety and Applied Nutrition
(CFSAN).

DATES: Submit either electronic or written comments on the notice by
August 21, 2020.

ADDRESSES: You may submit either electronic or written comments at any
time as follows:

Electronic Submissions

    Submit electronic comments in the following way:
     Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments. Comments submitted
electronically, including attachments, to https://www.regulations.gov
will be posted to the docket unchanged. Because your comment will be
made public, you are solely responsible for ensuring that your comment
does not include any confidential information that you or a third party
may not wish to be posted, such as medical information, your or anyone
else's Social Security number, or confidential business information,
such as a manufacturing process. Please note that if you include your
name, contact information, or other information that identifies you in
the body of your comments, that information will be posted on https://www.regulations.gov.
     If you want to submit a comment with confidential
information that you do not wish to be made available to the public,
submit the comment as a written/paper submission and in the manner
detailed (see ``Written/Paper Submissions'' and ``Instructions'').

Written/Paper Submissions

    Submit written/paper submissions as follows:
     Mail/Hand delivery/Courier (for written/paper
submissions): Dockets Management Staff (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.
     For written/paper comments submitted to the Dockets
Management Staff, FDA will post your comment, as well as any
attachments, except for information submitted, marked and identified,
as confidential, if submitted as detailed in ``Instructions.''
    Instructions: All submissions received must include the Docket No.
FDA-

2020-N-1450 for ``Electronic Submissions; Data Standards; Support for
the International Institute of Electrical and Electronics Engineers
Bioinformatics Computations and Analyses Standard for Bioinformatic
Workflows.'' Received comments will be placed in the docket and, except
for those submitted as ``Confidential Submissions,'' publicly viewable
at https://www.regulations.gov or at the Dockets Management Staff
between 9 a.m. and 4 p.m., Monday through Friday,<PHONE_NUMBER>.
     Confidential Submissions--To submit a comment with
confidential information that you do not wish to be made publicly
available, submit your comments only as a written/paper submission. You
should submit two copies total. One copy will include the information
you claim to be confidential with a heading or cover note that states
``THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.'' The Agency will
review this copy, including the claimed confidential information, in
its consideration of comments. The second copy, which will have the
claimed confidential information redacted/blacked out, will be
available for public viewing and posted on https://www.regulations.gov.
Submit both copies to the Dockets Management Staff. If you do not wish
your name and contact information to be made publicly available, you
can provide this information on the cover sheet and not in the body of
your comments and you must identify this information as
``confidential.'' Any information marked as ``confidential'' will not
be disclosed except in accordance with 21 CFR 10.20 and other
applicable disclosure laws. For more information about FDA's posting of
comments to public dockets, see 80 FR 56469, September 18, 2015, or
access the information at: https://www.govinfo.gov/content/pkg/FR-2015-09-18/pdf/2015-23389.pdf.
    Docket: For access to the docket to read background documents or
the electronic and written/paper comments received, go to https://www.regulations.gov and insert the docket number, found in brackets in
the heading of this document, into the ``Search'' box and follow the
prompts and/or go to the Dockets Management Staff, 5630 Fishers Lane,
Rm. 1061, Rockville, MD 20852,<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Stephen Ripley, Center for Biologics
Evaluation and Research, Food and Drug Administration, 10903 New
Hampshire Ave., Bldg. 71, Rm. 7301, Silver Spring, MD 20993-0002, 240-
402-7911; or Chenoa Conley, Center for Drug Evaluation and Research,
Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 51, Rm.
1117, Silver Spring, MD 20993-0002,<PHONE_NUMBER>; or Cindee Hogan,
Center for Food Safety and Applied Nutrition, Food and Drug
Administration, 5001 Campus Dr., College Park, MD 20740,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION: FDA is announcing support for the use in
regulatory submissions the current version of the IEEE BioCompute
standard (available at https://standards.ieee.org/standard/) and an
update to include this standard in the FDA Data Standards Catalog for
the submission of HTS data in NDAs, ANDAs, BLAs, and INDs to CBER,
CDER, and CFSAN.
    Scientific workflows have emerged as a model for representing and
managing complex scientific computations. The BioCompute standard
facilitates the exchange of HTS bioinformatics workflows (i.e.,
computations and analyses) between various organizations by specifying
the information needed to understand and organize bioinformatic
analyses. Currently, the range of bioinformatics tools and associated
parameters of those tools makes it difficult to describe, exchange, and
assess the reproducibility of a complex analysis in a standardized
format.
    The BioCompute standard represents a distillation of the
bioinformatics workflows, describing the mechanisms for each step on
the pipeline. The pipeline steps are organized into groups of
conceptually related information or domains, which provides the ability
to describe the full extent of the analysis, the purpose of the
experiment, and any other relevant information. BioCompute tracks the
flow of data from the beginning to the end of the bioinformatics
pipeline, making transformations apparent at each step. In this way, an
analysis formatted according to the BioCompute standard provides the
manifest (metadata) for the HTS data files.

    Dated: July 16, 2020.
Lauren K. Roth,
Associate Commissioner for Policy.
[FR Doc. 2020-15771 Filed 7-21-20; 8:45 am]
BILLING CODE 4164-01-P