Notice2021-20080
Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees in BZX Rule 14.13 Applicable To Exchange-Traded Products Listed on the Exchange
Primary source
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Published
September 17, 2021
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 86 Issue 178 (Friday, September 17, 2021)</title>
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[Federal Register Volume 86, Number 178 (Friday, September 17, 2021)]
[Notices]
[Pages 51947-51949]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-20080]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-92954; File No. SR-CboeBZX-2021-058]
Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend
the Fees in BZX Rule 14.13 Applicable To Exchange-Traded Products
Listed on the Exchange
September 13, 2021.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\
[[Page 51948]]
notice is hereby given that on August 30, 2021, Cboe BZX Exchange, Inc.
(``Exchange'' or ``BZX'') filed with the Securities and Exchange
Commission (``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 BZX Exchange, Inc. (the ``Exchange'' or ``BZX'') is filing
with the Securities and Exchange Commission (``Commission'') a proposed
rule change to amend the fees applicable to securities listed on the
Exchange, which are set forth in BZX Rule 14.13.
The text of the proposed rule change is also available on the
Exchange's website (<a href="http://markets.cboe.com/us/equities/regulation/rule_filings/bzx/">http://markets.cboe.com/us/equities/regulation/rule_filings/bzx/</a>), 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 Rule 14.13(b)(2)(E) related to
refunds of the annual fees for listing on the Exchange where a class of
securities is removed from listing during the year. Specifically, the
Exchange is proposing to amend the rule to allow the Exchange to
prorate and refund fees applicable to exchange-traded products
(``ETPs'') \3\ that have liquidated and as a result are delisted from
the Exchange for the portion of the calendar year that such issue was
listed on the Exchange, based on the percentage of trading days listed
during that calendar year.
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\3\ As defined in Rule 11.8(e)(1)(A), the term ``ETP'' means any
security listed pursuant to Exchange Rule 14.11.
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Rule 14.13(b)(2)(C) describes the annual fees applicable to issuers
of ETPs listed on the Exchange. As provided in Rule 14.13(b)(2)(C)(ii),
newly listed ETPs are subject to annual fees in the year of listing,
prorated based on the number of trading days remaining in the calendar
year. The annual fees for ETPs are billed in January for the
forthcoming year. Currently, when an ETP liquidates, and as a result,
is delisted from the Exchange, the issuer is responsible for the full
year's annual fee as billed in January. The issuer receives no refund
for amounts paid or reduction of amounts payable even though the ETP
has liquidated. The Exchange proposes to amend Rule 14.13(b)(2)(C)(ii)
[sic] to provide that the annual fees applicable to ETPs that have
liquidated and as a result are delisted from the Exchange will be
prorated for the portion of the calendar year that such issue was
listed on the Exchange, based on days listed that calendar year. Thus,
for example, if the issuer of an ETP has paid an annual fee of $4,000
as billed in January and such issue is liquidated and then delisted
from the Exchange at the close of business on the 126th of 252 trading
days in a year, the issuer would receive a refund of $2,000, which
represents a pro rata credit of annual fees owed for the year. Any such
refund will be payable in the month following delisting.
Notwithstanding the proposed proration of the annual fees for ETPs, the
Exchange will continue to be able to fund its regulatory obligations.
The Exchange intends to implement the proposed amendments to its
listing fees immediately.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\4\ Specifically, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(4) \5\ and 6(b)(5) \6\ in that it
provides for the equitable allocation of reasonable dues, fees and
other charges among issuers and it does not unfairly discriminate
between customers, issuers, brokers or dealers.
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\4\ 15 U.S.C. 78f(b).
\5\ 15 U.S.C. 78f(b)(4).
\6\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that the proposed amendment is reasonable,
fair and equitable, and not an unfairly discriminatory allocation of
fees and other charges because it would apply equally for all issuers.
The Exchange believes that the proposed pro rata reduction of the
annual fees as a result of liquidation and termination of an ETP is
reasonable in that it constitutes a potential reduction in annual fees
for ETPs that are liquidated and therefore are no longer collecting a
management fee to pay for such expenses. Notwithstanding the proposed
proration of the annual fees for ETPs, the Exchange will continue to be
able to fund its regulatory obligations.
Based on the foregoing, the Exchange believes that the proposed
rule change is consistent with the Act.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange does not believe
that the proposed change burdens competition, but instead, enhances
competition, as it will permit the Exchange to better compete with
other exchanges with respect to fees changed [sic] in connection with
listing ETPs. The Exchange does not believe the proposed amendments
would burden intramarket competition as they would be available to all
issuers uniformly.
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 \7\ and paragraph (f) of Rule 19b-4 \8\
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.
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\7\ 15 U.S.C. 78s(b)(3)(A).
\8\ 17 CFR 240.19b-4(f).
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[[Page 51949]]
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
<bullet> Use the Commission's internet comment form (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#2f5d5a434a024c4042424a415b5c6f5c4a4c01484059"><span class="__cf_email__" data-cfemail="8efcfbe2eba3ede1e3e3ebe0fafdcefdebeda0e9e1f8">[email protected]</span></a>. Please include
File Number SR-CboeBZX-2021-058 on the subject line.
Paper Comments
<bullet> 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-CboeBZX-2021-058. 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 (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>).
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-CboeBZX-2021-058 and should be submitted
on or before October 8, 2021.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-20080 Filed 9-16-21; 8:45 am]
BILLING CODE 8011-01-P
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