[Federal Register Volume 82, Number 108 (Wednesday, June 7, 2017)]
[Notices]
[Pages 26549-26552]
[FR Doc No: 2017-11746]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80835; File No. SR-BatsEDGA-2017-14]

Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice
of Filing of a Proposed Rule Change To Adopt Rule 4.17, Consolidated
Audit Trail--Fee Dispute Resolution

June 1, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act'' or ``Exchange Act''),\1\ and Rule 19b-4 thereunder,\2\
notice is hereby given that on May 23, 2017, Bats EDGA Exchange, Inc.
(the ``Exchange'' or ``EDGA'') filed with the Securities and Exchange
Commission (``Commission'' or ``SEC'') the proposed rule change as
described in Items I and II below, which Items have been prepared by
the Exchange. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange filed a proposal to adopt Rule 4.17 (Consolidated
Audit Trail--Fee Dispute Resolution) to establish the procedures for
resolving potential disputes related to CAT Fees charged to Industry
Members.\3\
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    \3\ Unless otherwise specified, capitalized terms used in this
rule filing are defined as set forth herein, or in the Consolidated
Audit Trail Funding Fees Rule, the CAT Compliance Rule Series or in
the CAT NMS Plan.
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    The text of the proposed rule change is available at the Exchange's
Web site at www.bats.com, at the principal office of the Exchange, and
at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant parts of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    Bats BYX Exchange, Inc., Bats BZX Exchange, Inc., Bats EDGA
Exchange, Inc., Bats EDGX Exchange, Inc., BOX Options Exchange LLC, C2
Options Exchange, Incorporated, Chicago Board Options Exchange,
Incorporated, Chicago Stock Exchange, Inc., Financial Industry
Regulatory Authority, Inc. (``FINRA''), Investors' Exchange LLC, Miami
International Securities Exchange, LLC, MIAX PEARL, LLC, NASDAQ BX,
Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC,\4\ NASDAQ
PHLX LLC, The NASDAQ Stock Market LLC, New York Stock Exchange LLC,
NYSE MKT LLC, NYSE Arca, Inc. and NYSE National, Inc.\5\ (collectively,
the ``Participants'') filed with the Commission, pursuant to Section
11A of the Exchange Act \6\ and Rule 608 of Regulation NMS
thereunder,\7\ the National Market System Plan Governing the
Consolidated Audit Trail (the ``CAT NMS Plan'' or ``Plan'').\8\ The
Participants filed the Plan to comply with Rule 613 of Regulation NMS
under the Exchange Act. The Plan was published for comment in the
Federal Register on May 17, 2016,\9\ and approved by the Commission, as
modified, on November 15, 2016.\10\ The Plan is designed to create,
implement and maintain a consolidated audit trail (``CAT'') that would
capture customer and order event information for orders in NMS
Securities and OTC Equity Securities, across all markets, from the time
of order inception through routing, cancellation, modification, or
execution in a single consolidated data source. The Plan accomplishes
this by creating CAT NMS, LLC (the ``Company''), of which each
Participant is a member, to operate the CAT.\11\ Under the CAT NMS
Plan, the Operating Committee of the Company (``Operating Committee'')
has discretion to establish funding for the Company to operate the CAT,
including establishing fees that the Participants will pay, and
establishing fees for Industry Members that will be implemented by the
Participants (``CAT Fees'').\12\ The Participants are required to file
with the SEC under Section 19(b) of the Exchange Act any such CAT Fees
applicable to Industry Members that the Operating Committee
approves.\13\ Accordingly, the Exchange has filed a proposed rule
change with the SEC to adopt the Consolidated Audit Trail Funding Fees,
which will require Industry Members that are Members of the Exchange to
pay the CAT Fees determined by the Operating Committee.\14\ The
Exchange submits this rule filing to adopt Rule 4.17 (Consolidated
Audit Trail--Fee Dispute Resolution) to establish the procedures for
resolving potential disputes related to CAT Fees charged to Industry
Members. Proposed Rule 4.17 is described below.
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    \4\ ISE Gemini, LLC, ISE Mercury, LLC and International
Securities Exchange, LLC have been renamed Nasdaq GEMX, LLC, Nasdaq
MRX, LLC, and Nasdaq ISE, LLC, respectively. See Securities Exchange
Act Rel. No. 80248 (Mar. 15, 2017), 82 FR 14547 (Mar. 21, 2017);
Securities Exchange Act Rel. No. 80326 (Mar. 29, 2017), 82 FR 16460
(Apr. 4, 2017); and Securities Exchange Act Rel. No. 80325 (Mar. 29,
2017), 82 FR 16445 (Apr. 4, 2017).
    \5\ National Stock Exchange, Inc. has been renamed NYSE
National, Inc. See Securities Exchange Act Rel. No. 79902 (Jan. 30,
2017), 82 FR 9258 (Feb. 3, 2017).
    \6\ 15 U.S.C. 78k-1.
    \7\ 17 CFR 242.608.
    \8\ See Letter from the Participants to Brent J. Fields,
Secretary, Commission, dated September 30, 2014; and Letter from
Participants to Brent J. Fields, Secretary, Commission, dated
February 27, 2015. On December 24, 2015, the Participants submitted
an amendment to the CAT NMS Plan. See Letter from Participants to
Brent J. Fields, Secretary, Commission, dated December 23, 2015.
    \9\ Securities Exchange Act Rel. No. 77724 (Apr. 27, 2016), 81
FR 30614 (May 17, 2016).
    \10\ Securities Exchange Act Rel. No. 79318 (Nov. 15, 2016), 81
FR 84696 (Nov. 23, 2016) (``Approval Order'').
    \11\ The Plan also serves as the limited liability company
agreement for the Company.
    \12\ Section 11.1(b) of the CAT NMS Plan.
    \13\ Id.
    \14\ See Securities Exchange Act Release No. 80256 (March 15,
2017), 82 FR 10101 (March 21, 2017) (SR-BatsEDGA-2017-03) [sic].
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(1) Definitions
    Paragraph (a) of Proposed Rule 4.17 sets forth the definitions for
Proposed Rule 4.17. Paragraph (a)(1) of Proposed Rule 4.17 states that,
for purposes of Rule 4.17, the terms ``CAT NMS Plan'', ``Industry
Member'', ``Operating Committee'', and ``Participant'' are defined as
set forth in the Rule 4.5 (Consolidated Audit Trail--Definitions), and
the term ``CAT Fee'' is defined as set forth in the Consolidated Audit
Trail Funding Fees. In addition, the Exchange proposes to add paragraph
(a)(2) to Proposed Rule 4.17. New paragraph (a)(2) would define the
term ``Subcommittee'' to mean a subcommittee designated by the
Operating Committee pursuant to the CAT NMS Plan. This definition is
the same substantive definition as set forth in Section 1.1 of the CAT
NMS Plan.
(2) Fee Dispute Resolution
    Section 11.5 of the CAT NMS Plan requires Participants to adopt
rules requiring that disputes with respect to

fees charged to Industry Members pursuant to the CAT NMS Plan be
determined by the Operating Committee or Subcommittee. Section 11.5 of
the CAT NMS Plan also states that decisions by the Operating Committee
or Subcommittee on such matters shall be binding on Industry Members,
without prejudice to the right of any Industry Member to seek redress
from the SEC pursuant to SEC Rule 608 or in any other appropriate
forum. The Exchange proposes to adopt paragraph (b) of Proposed Rule
4.17. Paragraph (b) of Proposed Rule 4.17 states that disputes
initiated by an Industry Member with respect to CAT Fees charged to
such Industry Member pursuant to the Consolidated Audit Trail Funding
Fees, including disputes related to the designated tier and the fee
calculated pursuant to such tier, shall be resolved by the Operating
Committee, or a Subcommittee designated by the Operating Committee, of
the CAT NMS Plan, pursuant to the Fee Dispute Resolution Procedures
adopted pursuant to the CAT NMS Plan and set forth in paragraph (c) of
Proposed Rule 4.17. Decisions on such matters shall be binding on
Industry Members, without prejudice to the rights of any such Industry
Member to seek redress from the SEC or in any other appropriate forum.
    The Operating Committee has adopted ``Fee Dispute Resolution
Procedures'' governing the manner in which disputes regarding CAT Fees
charged pursuant to the Consolidated Audit Trail Funding Fees will be
addressed. These Fee Dispute Resolution Procedures, as they relate to
Industry Members, are set forth in paragraph (c) of Proposed Rule 4.17.
Specifically, the Fee Dispute Resolution Procedures provide the
procedure for Industry Members that dispute CAT Fees charged to such
Industry Member pursuant to one or more of the Participants'
Consolidated Audit Trail Funding Fees Rules, including disputes related
to the designated tier and the fee calculated pursuant to such tier, to
apply for an opportunity to be heard and to have the CAT Fees charged
to such Industry Member reviewed. The Procedures are modeled after the
adverse action procedures adopted by various exchanges,\15\ and will be
posted on the Web site for the CAT NMS Plan Web site.\16\
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    \15\ See, e.g., Chapter X of Bats EDGA Exchange, Inc. (Adverse
Action); and Chapter X of NYSE National, Inc. (Adverse Action).
    \16\ The CAT NMS Plan Web site is www.catnmsplan.com.
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    Under these Procedures, an Industry Member that disputes CAT Fees
charged to such Industry Member and that desires to have an opportunity
to be heard with respect to such disputed CAT Fees must file a written
application with the Company within 15 business days after being
notified of such disputed CAT Fees. The application must identify the
disputed CAT Fees, state the specific reasons why the applicant takes
exception to such CAT Fees, and set forth the relief sought. In
addition, if the applicant intends to submit any additional documents,
statements, arguments or other material in support of the application,
the same should be so stated and identified.
    The Company will refer applications for hearing and review promptly
to the Subcommittee designated by the Operating Committee pursuant to
Section 4.12 of the CAT NMS Plan with responsibility for conducting the
reviews of CAT Fee disputes pursuant to these Procedures. This
Subcommittee will be referred to as the Fee Review Subcommittee. The
members of the Fee Review Subcommittee will be subject to the
provisions of Section 4.3(d) of the CAT NMS Plan regarding recusal and
Conflicts of Interest. The Fee Review Subcommittee will keep a record
of the proceedings.
    The Fee Review Subcommittee will hold hearings promptly. The Fee
Review Subcommittee will set a hearing date. The parties to the hearing
shall furnish the Fee Review Subcommittee with all materials relevant
to the proceedings at least 72 hours prior to the date of the hearing.
Each party will have the right to inspect and copy the other party's
materials prior to the hearing.
    The parties to the hearing will consist of the applicant and a
representative of the Company who shall present the reasons for the
action taken by the Company that allegedly aggrieved the applicant. The
applicant is entitled to be accompanied, represented and advised by
counsel at all stages of the proceedings.
    The Fee Review Subcommittee will determine all questions concerning
the admissibility of evidence and will otherwise regulate the conduct
of the hearing. Each of the parties will be permitted to make an
opening statement, present witnesses and documentary evidence, cross
examine opposing witnesses and present closing arguments orally or in
writing as determined by the Fee Review Subcommittee. The Fee Review
Subcommittee also will have the right to question all parties and
witnesses to the proceeding. The Fee Review Subcommittee must keep a
record of the hearing. The formal rules of evidence will not apply.
    The Fee Review Subcommittee must set forth its decision in writing
and send the written decision to the parties to the proceeding. Such
decisions will contain the reasons supporting the conclusions of the
Fee Review Subcommittee.
    The decision of the Fee Review Subcommittee will be subject to
review by the Operating Committee either on its own motion within 20
business days after issuance of the decision or upon written request
submitted by the applicant within 15 business days after issuance of
the decision. The applicant's petition must be in writing and must
specify the findings and conclusions to which the applicant objects,
together with the reasons for such objections. Any objection to a
decision not specified in writing will be considered to have been
abandoned and may be disregarded. Parties may petition to submit a
written argument to the Operating Committee and may request an
opportunity to make an oral argument before the Operating Committee.
The Operating Committee will have sole discretion to grant or deny
either request.
    The Operating Committee will conduct the review. The review will be
made upon the record and will be made after such further proceedings,
if any, as the Operating Committee may order. Based upon such record,
the Operating Committee may affirm, reverse or modify, in whole or in
part, the decision of the Fee Review Subcommittee. The decision of the
Operating Committee will be in writing, will be sent to the parties to
the proceeding and will be final.
    The Procedures state that a final decision regarding the disputed
CAT Fees by the Operating Committee, or the Fee Review Subcommittee (if
there is no review by the Operating Committee), must be provided within
90 days of the date on which the Industry Member filed a written
application regarding disputed CAT Fees with the Company. The Operating
Committee may extend the 90-day time limit at its discretion.
    In addition, the Procedures state that any notices or other
documents may be served upon the applicant either personally or by
leaving the same at its, his or her place of business or by deposit in
the United States post office, postage prepaid, by registered or
certified mail, addressed to the applicant at its, his or her last
known business or residence address. The Procedures also state that any
time limits imposed under the Procedures for the submission of answers,
petitions or

other materials may be extended by permission of the Operating
Committee. All papers and documents relating to review by the Fee
Review Subcommittee or the Operating Committee must be submitted to the
Fee Review Subcommittee or Operating Committee, as applicable.
    The Procedures also note that decisions on such CAT Fee disputes
made pursuant to these Procedures will be binding on Industry Members,
without prejudice to the rights of any such Industry Member to seek
redress from the SEC or in any other appropriate forum.
    Finally, an Industry Member that files a written application with
the Company regarding disputed CAT Fees in accordance with these
Procedures is not required to pay such disputed CAT Fees until the
dispute is resolved in accordance with these Procedures, including any
review by the SEC or in any other appropriate forum. For these
purposes, the disputed CAT Fees means the amount of the invoiced CAT
Fees that the Industry Member has asserted pursuant to these Procedures
that such Industry Member does not owe to the Company. The Industry
Member must pay any invoiced CAT Fees that are not disputed CAT Fees
when due as set forth in the original invoice.
    Once the dispute regarding CAT Fees is resolved pursuant to these
Procedures, if it is determined that the Industry Member owes any of
the disputed CAT Fees, then the Industry Member must pay such disputed
CAT Fees that are owed as well as interest on such disputed CAT Fees
from the original due date (that is, 30 days after receipt of the
original invoice of such CAT Fees) until such disputed CAT Fees are
paid at a per annum rate equal to the lesser of (i) the Prime Rate plus
300 basis points, or (ii) the maximum rate permitted by applicable law.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6(b)(5) of the Act,\17\ which require,
among other things, that Exchange rules must be designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, and, in general, to protect investors
and the public interest, and not designed to permit unfair
discrimination between customers, issuers, brokers and dealer, and
Section 15A(b)(5) [sic] of the Act,\18\ which requires that Exchange
rules provide for the equitable allocation of reasonable dues, fees,
and other charges among members and issuers and other persons using its
facilities.
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    \17\ 15 U.S.C. 78f(b)(5).
    \18\ 15 U.S.C. 78o-3(b)(5) [sic].
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    The Exchange believes that this proposal is consistent with the Act
because it implements, interprets or clarifies Section 11.5 of the
Plan, and is designed to assist the Exchange and its Industry Members
in meeting regulatory obligations pursuant to the Plan. In approving
the Plan, the SEC noted that the Plan ``is necessary and appropriate in
the public interest, for the protection of investors and the
maintenance of fair and orderly markets, to remove impediments to, and
perfect the mechanism of a national market system, or is otherwise in
furtherance of the purposes of the Act.'' \19\ To the extent that this
proposal implements, interprets or clarifies the Plan and applies
specific requirements to Industry Members, the Exchange believes that
this proposal furthers the objectives of the Plan, as identified by the
SEC, and is therefore consistent with the Act.
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    \19\ Approval Order at 84697.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    Section 6(b)(8) of the Act \20\ require [sic] that Exchange rules
not impose any burden on competition that is not necessary or
appropriate. 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 Act. The Exchange
notes that the proposed rule change implements Section 11.5 of the CAT
NMS Plan approved by the Commission, and is designed to assist the
Exchange in meeting its regulatory obligations pursuant to the Plan.
Similarly, all national securities exchanges and FINRA are proposing
this proposed rule to implement the requirements of the CAT NMS Plan.
Therefore, this is not a competitive rule filing and, therefore, it
does not raise competition issues between and among the exchanges and
FINRA.
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    \20\ 15 U.S.C. 78f(b)(8).
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the Exchange consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-BatsEDGA-2017-14 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-BatsEDGA-2017-14. 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 Web site (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 Web site 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; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-BatsEDGA-2017-14, and should
be submitted on or before June 28, 2017.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\21\
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    \21\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-11746 Filed 6-6-17; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 24 (Tuesday, February 5, 2019)]
[Notices]
[Pages 1810-1812]
[FR Doc No: 2019-01179]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85018; File No. SR-CBOE-2018-075]

Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend
its Fees Schedule With Respect to the SPX Select Market-Maker Program

January 31, 2019.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on December 19, 2018, Cboe Exchange, Inc. (the ``Exchange'' or
``Cboe Options'') filed with the Securities and Exchange Commission
(the ``Commission'') the proposed rule change as described in Items I,
II, and III below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe Options'') proposes
to amend its Fees Schedule with respect to the SPX Select Market-Maker
Program. The text of the proposed rule change is provided in Exhibit 5.
    The text of the proposed rule change is also available on the
Exchange's website (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the
Secretary, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these

statements may be examined at the places specified in Item IV below.
The Exchange has prepared summaries, set forth in sections A, B, and C
below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange is proposing to amend the SPX Select Market-Maker
(``SMM'') Program, effective December 31, 2018. By way of background,
the Exchange recently established a financial incentive program for SPX
SMMs, which provides that any appointed SPX SMM will receive a monthly
waiver of the cost of one Market-Maker Trading Permit and one SPX Tier
Appointment provided that the SMM satisfies a heightened quoting
standard for that month, which standard is set forth in Footnote 49 of
the Fees Schedule. Footnote 49 currently provides that an SMM will
receive the monthly Trading Permit and SPX Tier Appointment waiver if
it (1) provides continuous electronic quotes in 95% of all SPX series
90% of the time in a given month, (2) submits opening quotes that are
no wider than the Opening Exchange Prescribed Width (``OEPW'') within
one minute of the initiation of an opening rotation in any series that
is not open due to the lack of a qualifying quote, on all trading days,
to ensure electronic quotes on the open that allow the series to open,
(3) submit [sic] opening quotes that are no wider than the OEPW quote
by 8:00 a.m. (CT) on volatility index derivative settlement days in the
SPX series that expire in the month used to calculate the settlement
value for expiring volatility index derivatives and (4) provides quotes
for the end-of-month fair value closing rotation on a rotating
basis.\3\
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    \3\ The end-of-month fair value closing rotation is governed by
Cboe Options Rule 6.2, Interpretation and Policy .06.
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    The Exchange proposes to amend the criteria currently set forth in
the fourth prong of the heightened quoting standard described above.
Specifically, the Exchange proposes to no longer require that a
designated SMM provide quotes for the end-of-month fair value closing
rotation (``closing rotation'') on a rotating basis and instead require
that within 30 minutes from the initiation of the end-of-month fair
value closing rotation, the Exchange must disseminate end-of-month
closing quotations pursuant to Cboe Options Rule 6.2(.06)(a) in order
for the 4th prong to be satisfied. By way of background, Interpretation
and Policy .06(a) of Rule 6.2 provides that on the last business day of
each month, the Exchange will conduct special end-of-month non-trading
rotations for each series of SPX options in order to determine the
theoretical ``fair value'' of such series as [sic] of SPX as of the
time of close of trading in the underlying cash market.\4\ The Exchange
proposes to condition the SMM financial benefit on the closing rotation
resulting in the dissemination of quotes pursuant to Cboe Options Rule
6.2(.06)(a) as the Exchange believes the proposed change will encourage
all SMMs to provide end-of-month non-trading settlement pricing
quotations in SPX and SPXW as it would be in the interest of the SMMs
to each participate in order to ensure that the Exchange is ultimately
able to disseminate the fair value quotes, thereby satisfying the
fourth prong. The Exchange also believes the proposed amendment to the
fourth prong is commensurate with the financial benefit the Exchange
offers through the SMM program.
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    \4\ See Cboe Options Rule 6.2, Interpretation and Policy
.06.(a).
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    The Exchange lastly proposes to make non-substantive clean up
changes to correct two typographical errors. First, the Exchange notes
that the word ``to'' is missing from the second prong of Footnote 49
and as such, proposes to add ``to'' in the second prong. Second, the
Exchange proposes to add an ``s'' to the end of ``submit'' in the third
prong so that the language in each prong is grammatically consistent.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\5\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \6\ requirements that the rules of an exchange be
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest. Additionally,
the Exchange believes the proposed rule change is consistent with
Section 6(b)(4) of the Act,\7\ which requires that Exchange rules
provide for the equitable allocation of reasonable dues, fees, and
other charges among its Trading Permit Holders and other persons using
its facilities.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
    \7\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes amending the fourth prong in Footnote 49 is
reasonable as it does not change the financial benefit offered.
Additionally, the Exchange believes the proposed amendment is
reasonable, equitable and not unfairly discriminatory because it
applies to all SMMs uniformly and because if the fourth prong, as
amended, is not met, the SMMs merely will not receive the offered
financial benefit. The Exchange also believes the requirement under the
amended fourth prong is commensurate with the financial benefit
offered. Additionally, the Exchange notes that its closing rotation is
designed to foster consistency in the S&P 500 Index-related markets by
aligning the price of SPX options and S&P 500 futures prices. The
Exchange believes that its proposed rule change removes impediments to
and perfects the mechanism of a free and open national market system as
it continues to allow traders and investors to realize consistency
across the different S&P 500 Index-related markets at the end of each
month. Particularly, as noted above, the proposed amendment is designed
to encourage all SMMs to provide end-of-month non-trading settlement
pricing quotations in SPX and SPXW, which would increase the
probability that the Exchange would be able to disseminate fair value
quotes pursuant to Rule 6.2(.06)(a).
    The Exchange believes the proposal to fix two typographical errors
makes the fees schedule easier to read and reduces potential confusion,
thereby removing impediments to and perfecting the mechanism of a free
and open market and a national market system, and, in general,
protecting investors and the public interest.

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

    The Exchange does not believe that the proposed rule changes will
impose any burden on competition that are not necessary or appropriate
in furtherance of the purposes of the Act. The Exchange does not
believe that the proposed rule change will impose any burden on
intramarket competition that is not necessary or appropriate in
furtherance of the purposes of the Act because it applies uniformly to
all SPX

SMMs. The Exchange does not believe that the proposed rule change will
impose any burden on intermarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act because SPX
options are proprietary products that will only be traded on Cboe
Options. To the extent that the proposed changes make Cboe Options a
more attractive marketplace for market participants at other exchanges,
such market participants are welcome to become Cboe Options market
participants.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    The Exchange neither solicited nor received comments on the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \8\ and paragraph (f) of Rule 19b-4 \9\
thereunder. At any time within 60 days of the filing of the proposed
rule change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission will institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-CBOE-2018-075 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-CBOE-2018-075. 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-CBOE-2018-075, and should be submitted
on or before February 20, 2019.
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-01179 Filed 2-4-19; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 85, Number 72 (Tuesday, April 14, 2020)]
[Rules and Regulations]
[Pages 20593-20596]
[FR Doc No: 2020-07094]

=======================================================================
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DEPARTMENT OF HOMELAND SECURITY

Coast Guard

33 CFR Part 165

[Docket Number USCG-2020-0061]
RIN 1625-AA00

Safety Zone for Fireworks Displays; Upper Potomac River,
Washington Channel, DC

AGENCY: Coast Guard, DHS.

ACTION: Temporary final rule.

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SUMMARY: The Coast Guard is establishing a temporary safety zone for

certain waters of the Upper Potomac River. This action is necessary to
provide for the safety of life on these navigable waters of the
Washington Channel adjacent to The Wharf DC, Washington, DC, for
recurring fireworks displays from April 4, 2020, through December 31,
2020. This regulation prohibits persons and vessels from being in the
safety zone unless authorized by the Captain of the Port Maryland-
National Capital Region or a designated representative.

DATES: This rule is effective without actual notice from April 14, 2020
through December 31, 2020. For the purposes of enforcement, actual
notice will be used from April 4, 2020, until April 14, 2020.

ADDRESSES: To view documents mentioned in this preamble as being
available in the docket, go to https://www.regulations.gov, type USCG-
2020-0061 in the ``SEARCH'' box and click ``SEARCH.'' Click on Open
Docket Folder on the line associated with this rule.

FOR FURTHER INFORMATION CONTACT: If you have questions on this rule,
call or email Mr. Ron Houck, Sector Maryland-National Capital Region
Waterways Management Division, U.S. Coast Guard; telephone 410-576-
2674, email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

I. Table of Abbreviations

CFR Code of Federal Regulations
COTP Captain of the Port
DHS Department of Homeland Security
FR Federal Register
NPRM Notice of proposed rulemaking
Sec.  Section
U.S.C. United States Code

II. Background Information and Regulatory History

    On January 9, 2020, Pyrotecnico, Inc., of New Castle, PA, notified
the Coast Guard that it will be conducting seven fireworks displays,
sponsored by The Wharf DC, from 7 p.m. to 11:59 p.m. for various events
from April 4, 2020, through December 31, 2020. The fireworks are to be
launched from a barge in the Washington Channel, adjacent to The Wharf
DC in Washington, DC. The fireworks company has provided dates for two
of the events, April 4, 2020, and December 5, 2020. However, the dates
for the remaining five events have not yet been finalized.
    On February 14, 2020, the Coast Guard published a notice of
proposed rulemaking (NPRM) titled ``Safety Zone for Fireworks Displays;
Upper Potomac River, Washington Channel, DC'' (85 FR 8507). There we
stated why we issued the NPRM, and invited comments on our proposed
regulatory action related to these fireworks displays. During the
comment period that ended March 16, 2020, we received no comments.
    Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause
exists for making this rule effective less than 30 days after
publication in the Federal Register. Delaying the effective date of
this rule would be impracticable because immediate action is needed to
respond to the potential safety hazards associated with the fireworks
displays, including the accidental discharge of fireworks, dangerous
projectiles, and falling hot embers or other debris.

III. Legal Authority and Need for Rule

    The Coast Guard is issuing this rule under authority in 46 U.S.C.
70034 (previously 33 U.S.C. 1231). The Captain of the Port Maryland-
National Capital Region (COTP) has determined that potential hazards
associated with the fireworks to be used in these displays will be a
safety concern for anyone within 200 feet of the fireworks barge. The
purpose of this rule is to ensure safety of vessels and the navigable
waters in the safety zone before, during, and after the scheduled
events.

IV. Discussion of Comments, Changes, and the Rule

    As noted above, we received no comments on our NPRM published
February 14, 2020. There are no changes in the regulatory text of this
rule from the proposed rule in the NPRM.
    This rule establishes a temporary recurring safety zone in the
Washington Channel from April 4, 2020, through December 31, 2020. The
safety zone will cover all navigable waters of the Washington Channel
within 200 feet of the fireworks barge. It is anticipated that the
safety zone will be activated for seven separate events during 2020.
For each event, the barge will be located within an area bounded on the
south by latitude 38[deg]52'30'' N, and bounded on the north by the
Francis Case (I-395) Memorial Bridge, located at Washington, DC. The
safety zone will be enforced from 7 p.m. until 11:59 p.m. for each
fireworks display scheduled from April 4, 2020, through December 31,
2020. Prior to enforcement, the COTP will provide notice by publishing
a Notice of Enforcement at least 2 days in advance of the event in the
Federal Register, as well as issuing a Local Notice to Mariners and
Broadcast Notice to Mariners at least 24 hours in advance. The duration
of the zone is intended to ensure the safety of vessels and these
navigable waters before, during, and after the scheduled fireworks
display. No vessel or person will be permitted to enter the safety zone
without obtaining permission from the COTP or a designated
representative.

V. Regulatory Analyses

    We developed this rule after considering numerous statutes and
Executive orders related to rulemaking. Below we summarize our analyses
based on a number of these statutes and Executive orders, and we
discuss First Amendment rights of protestors.

A. Regulatory Planning and Review

    Executive Orders 12866 and 13563 direct agencies to assess the
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits. Executive Order 13771 directs agencies to control
regulatory costs through a budgeting process. This rule has not been
designated a ``significant regulatory action,'' under Executive Order
12866. Accordingly, this rule has not been reviewed by the Office of
Management and Budget (OMB), and pursuant to OMB guidance it is exempt
from the requirements of Executive Order 13771.
    This regulatory action determination is based on the size,
duration, and time-of-day of the safety zone. It is anticipated that
the safety zone will be activated for seven separate events during
2020. Although vessel traffic will not be able to safely transit around
this safety zone when being enforced, the impact will be for 5 hours or
less for each of the 7 fireworks events (35 total enforcement hours or
fewer) during the evening when vessel traffic in Washington Channel is
normally low. Moreover, the Coast Guard will issue a Broadcast Notice
to Mariners via VHF-FM marine channel 16 about the zone.

B. Impact on Small Entities

    The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as
amended, requires Federal agencies to consider the potential impact of
regulations on small entities during rulemaking. The term ``small
entities'' comprises small businesses, not-for-profit organizations
that are independently owned and operated and are not dominant in their
fields, and governmental jurisdictions with populations of less than
50,000. The Coast Guard received no comments from the Small Business
Administration on this rulemaking. The Coast Guard certifies under 5
U.S.C. 605(b) that this rule will not have a significant economic
impact on a substantial number of small entities.

    While some owners or operators of vessels intending to transit the
safety zone may be small entities, for the reasons stated in section
V.A above, this rule will not have a significant economic impact on any
vessel owner or operator.
    Under section 213(a) of the Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104-121), we want to assist small
entities in understanding this rule. If the rule would affect your
small business, organization, or governmental jurisdiction and you have
questions concerning its provisions or options for compliance, please
call or email the person listed in the FOR FURTHER INFORMATION CONTACT
section.
    Small businesses may send comments on the actions of Federal
employees who enforce, or otherwise determine compliance with, Federal
regulations to the Small Business and Agriculture Regulatory
Enforcement Ombudsman and the Regional Small Business Regulatory
Fairness Boards. The Ombudsman evaluates these actions annually and
rates each agency's responsiveness to small business. If you wish to
comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR
(1-888-734-3247). The Coast Guard will not retaliate against small
entities that question or complain about this rule or any policy or
action of the Coast Guard.

C. Collection of Information

    This rule will not call for a new collection of information under
the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

D. Federalism and Indian Tribal Governments

    A rule has implications for federalism under Executive Order 13132,
Federalism, if it has a substantial direct effect on the States, on the
relationship between the National Government and the States, or on the
distribution of power and responsibilities among the various levels of
government. We have analyzed this rule under that Order and have
determined that it is consistent with the fundamental federalism
principles and preemption requirements described in Executive Order
13132.
    Also, this rule does not have tribal implications under Executive
Order 13175, Consultation and Coordination with Indian Tribal
Governments, because it does not have a substantial direct effect on
one or more Indian tribes, on the relationship between the Federal
Government and Indian tribes, or on the distribution of power and
responsibilities between the Federal Government and Indian tribes.

E. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538)
requires Federal agencies to assess the effects of their discretionary
regulatory actions. In particular, the Act addresses actions that may
result in the expenditure by a State, local, or tribal government, in
the aggregate, or by the private sector of $100,000,000 (adjusted for
inflation) or more in any one year. Though this rule will not result in
such an expenditure, we do discuss the effects of this rule elsewhere
in this preamble.

F. Environment

    We have analyzed this rule under Department of Homeland Security
Directive 023-01, Rev. 1, associated implementing instructions, and
Environmental Planning COMDTINST 5090.1 (series), which guide the Coast
Guard in complying with the National Environmental Policy Act of 1969
(42 U.S.C. 4321-4370f), and have determined that this action is one of
a category of actions that do not individually or cumulatively have a
significant effect on the human environment. This rule involves a
safety zone that will be in effect for the entire year, however, when
activated, it will last less than 5 hours and prohibit entry within a
portion of the Washington Channel. It is categorically excluded from
further review under paragraph L60(a) of Appendix A, Table 1 of DHS
Instruction Manual 023-01-001-01, Rev. 1. A Record of Environmental
Consideration supporting this determination is available in the docket.
For instructions on locating the docket, see the ADDRESSES section of
this preamble.

G. Protest Activities

    The Coast Guard respects the First Amendment rights of protesters.
Protesters are asked to call or email the person listed in the FOR
FURTHER INFORMATION CONTACT section to coordinate protest activities so
that your message can be received without jeopardizing the safety or
security of people, places or vessels.

List of Subjects in 33 CFR Part 165

    Harbors, Marine safety, Navigation (water), Reporting and
recordkeeping requirements, Security measures, Waterways.

    For the reasons discussed in the preamble, the Coast Guard amends
33 CFR part 165 as follows:

PART 165--REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS

0
1. The authority citation for part 165 continues to read as follows:

    Authority:  46 U.S.C. 70034, 70051; 33 CFR 1.05-1, 6.04-1, 6.04-
6, and 160.5; Department of Homeland Security Delegation No. 0170.1.

0
2. Add Sec.  165.T05-0061 to read as follows:

Sec.  165.T05-0061  Safety Zone for Fireworks Displays; Upper Potomac
River, Washington Channel, Washington, DC.

    (a) Location. The following area is a safety zone: All navigable
waters of the Washington Channel within 200 feet of the fireworks barge
which will be located within an area bounded on the south by latitude
38[deg]52'30'' N, and bounded on the north by the southern extent of
the Francis Case (I-395) Memorial Bridge, located at Washington, DC.
These coordinates are based on datum NAD 1983.
    (b) Definitions. As used in this section--
    (1) Captain of the Port (COTP) means the Commander, U.S. Coast
Guard Sector Maryland-National Capital Region.
    (2) Designated representative means any Coast Guard commissioned,
warrant, or petty officer who has been authorized by the Captain of the
Port Maryland-National Capital Region to assist in enforcing the safety
zone described in paragraph (a) of this section.
    (c) Regulations. (1) Under the general safety zone regulations in
subpart C of this part, you may not enter the safety zone described in
paragraph (a) of this section unless authorized by the COTP or the
COTP's designated representative. All vessels underway within this
safety zone at the time it is activated are to depart the zone.
    (2) To seek permission to enter, contact the COTP or the COTP's
representative by telephone at<PHONE_NUMBER> or on Marine Band Radio
VHF-FM channel 16 (156.8 MHz). The Coast Guard vessels enforcing this
section can be contacted on Marine Band Radio VHF-FM channel 16 (156.8
MHz).
    (3) Those in the safety zone must comply with all lawful orders or
directions given to them by the COTP or the COTP's designated
representative.
    (d) Enforcement officials. The U.S. Coast Guard may be assisted in
the patrol and enforcement of the safety zone by Federal, State, and
local agencies.
    (e) Enforcement. This safety zone will be enforced April 4, 2020,
through December 31, 2020, from 7 p.m. to 11:59

p.m. each day that a barge with a ``FIREWORKS--DANGER--STAY AWAY'' sign
on the port and starboard sides is on-scene or a ``FIREWORKS--DANGER--
STAY AWAY'' sign is posted on land adjacent to the shoreline, near the
location described in paragraph (a) of this section. The enforcement
times of this section are subject to change, but the duration of each
enforcement of the zone is expected to be 5 hours or less. Prior to
enforcement, the COTP will provide notice by publishing a Notice of
Enforcement at least 2 days in advance of the event in the Federal
Register, as well as issuing a Local Notice to Mariners and Broadcast
Notice to Mariners at least 24 hours in advance.

    Dated: March 26, 2020.
Joseph B. Loring,
Captain, U.S. Coast Guard, Captain of the Port Maryland-National
Capital Region.
[FR Doc. 2020-07094 Filed 4-13-20; 8:45 am]
 BILLING CODE 9110-04-P