Notice2021-21747
Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by MIAX PEARL, LLC To Amend Exchange Rule 100, Definitions, Rule 402, Criteria for Underlying Securities, Rule 403, Withdrawal of Approval of Underlying Securities, Rule 404, Series of Option Contracts Open for Trading, Rule 404A, Select Provisions of Options Listing Procedures Plan, Rule 406, Long-Term Option Contracts, Rule 500, Access to and Conduct on the Exchange, Rule 503, Openings on the Exchange, Rule 515, Execution of Orders, and Rule 519, MIAX Pearl Order Monitor (“MOM”)
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Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
October 5, 2021
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 86 Issue 190 (Tuesday, October 5, 2021)</title>
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[Federal Register Volume 86, Number 190 (Tuesday, October 5, 2021)]
[Notices]
[Pages 55085-55087]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-21747]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-93209; File No. SR-PEARL-2021-43]
Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing
and Immediate Effectiveness of a Proposed Rule Change by MIAX PEARL,
LLC To Amend Exchange Rule 100, Definitions, Rule 402, Criteria for
Underlying Securities, Rule 403, Withdrawal of Approval of Underlying
Securities, Rule 404, Series of Option Contracts Open for Trading, Rule
404A, Select Provisions of Options Listing Procedures Plan, Rule 406,
Long-Term Option Contracts, Rule 500, Access to and Conduct on the
Exchange, Rule 503, Openings on the Exchange, Rule 515, Execution of
Orders, and Rule 519, MIAX Pearl Order Monitor (``MOM'')
September 30, 2021.
Pursuant to the provisions of Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on September 24, 2021, MIAX PEARL, LLC (``MIAX
Pearl)'' or the ``Exchange'') filed with the Securities and Exchange
Commission (``Commission'') a 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 is filing a proposal to amend Exchange Rules 100,
Definitions, 402, Criteria for Underlying Securities, 403, Withdrawal
of Approval of Underlying Securities, 404, Series of Option Contracts
Open for Trading, 404A, Select Provisions of Options Listing Procedures
Plan, 406, Long-Term Option Contracts, 500, Access to and Conduct on
the Exchange, 503, Openings on the Exchange, 515, Execution of Orders,
and 519, MIAX Pearl Order Monitor (``MOM''), to make minor, non-
substantive edits and clarifying changes to the rule text.
The text of the proposed rule change is available on the Exchange's
website at <a href="http://www.miaxoptions.com/rule-filings/">http://www.miaxoptions.com/rule-filings/</a>pearl, at MIAX
Pearl's principal office, and at the Commission's Public Reference
Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend Exchange Rule 100, Definitions, to
make minor non-substantive edits and clarifying changes. First, the
Exchange proposes to amend Exchange Rule 100, Definitions, to make a
minor, non-substantive clarifying change to the definition for
``PBBO.'' Currently, the definition for ``PBBO'' is as follows: ``The
term `PBBO' means the best bid or offer on the PEARL Exchange.''
Pursuant to Exchange Rule 100, when referring to the Exchange, the term
``MIAX Pearl'' is used. The Exchange proposes to amend the definition
for ``PBBO'' in Exchange Rule 100 to insert the word ``MIAX'' in front
of the words ``PEARL Exchange'' to align the name of the Exchange with
how the term is defined and used throughout the Exchange's rulebook.
Further, the Exchange proposes to delete the word ``the'' before the
newly inserted word ``MIAX'' and delete the last word, ``Exchange,''
for clarity. With the proposed changes, the definition for ``PBBO''
will be as follows: ``The term `PBBO' means the best bid or offer on
MIAX Pearl.''
Next, the Exchange proposes to delete the period at the end of
subparagraph (a)(1) of Exchange Rule 402(a) and add ``; and'' for
purposes of clarity in the rule text that both conditions listed in
Exchange Rule 402(a)(1)-(2) must be met.
[[Page 55086]]
Next, the Exchange proposes to amend subparagraph (b) of Exchange
Rule 402 to correctly spell the word ``foregoing'' in the last sentence
before subparagraph (b)(1). The purpose of this change is for clarity
in the rule text.
Next, the Exchange proposes to delete the period at the end of
subparagraph (b)(6)(i) of Exchange Rule 402 and add ``; and'' for the
sentence to be grammatically correct and for purposes of clarity in the
rule text that both conditions listed in Exchange Rule 402(b)(6)(i)-
(ii) must be met.
Next, the Exchange proposes to delete the period at the end of
subparagraph (c)(2)(i)(A) of Exchange Rule 402 and add ``; and'' for
the sentence to be grammatically correct and for purposes of clarity in
the rule text.
Next, the Exchange proposes to delete the comma at the end of
subparagraph (g)(1) of Exchange Rule 402 and add a semicolon for
purposes of clarity in the rule text.
Next, the Exchange proposes to amend subparagraph (i) of Exchange
Rule 402 to remove the word ``or'' after proposed renumbered
subparagraphs (i)(1), (2) and (3). The Exchange also proposes to amend
the hierarchical headings in Exchange Rule 402(i) as follows:
Subparagraphs (i)(A)-(E) will be renumbered as (i)(1)-(5); subparagraph
(i)(E)(1) will be renumbered as (i)(5)(i); subparagraphs (i)(E)(1)(i)-
(iii) will be renumbered as (i)(5)(i)(A)-(C); subparagraph (i)(E)(2)
will be renumbered as (i)(5)(ii); subparagraphs (i)(E)(2)(i)-(ii) will
be renumbered as (i)(5)(ii)(A)-(B); and subparagraphs (i)(E)(2)(ii)(A)-
(D) will be renumbered as (i)(5)(ii)(B)1.-4. The purpose of these
proposed changes is to provide consistency and clarity throughout the
rule text for the hierarchical subparagraph headings.
Next, the Exchange proposes to delete the semicolon at the end of
subparagraph (k)(1)(vi) of Exchange Rule 402 and add a period for the
sentence to be grammatically correct and for purposes of clarity in the
rule text.
Next, the Exchange proposes to amend subparagraph (g) of Exchange
Rule 403 to capitalize the word ``In'' that begins subparagraphs (g)(1)
and (g)(2). The Exchange also proposes to amend subparagraph (g) of
Exchange Rule 403 to replace certain internal cross reference to other
rules in light of the changes described above. In particular, the
Exchange proposes to amend the cross references contained in Exchange
Rule 403(g)(1)-(2), that are to Exchange Rules 402(i)(E)(1)(i)-(ii), to
now be to Exchange Rule 402(i)(5)(i)(A)-(B). These proposed rule
changes are for clarity and consistency with the rule text.
Next, the Exchange proposes to amend Exchange Rule 403,
Interpretation and Policy .02, to add a colon before an itemized list
in the second sentence, which uses semicolons for the sentence to be
grammatically correct.
Next, the Exchange proposes to amend Exchange Rule 404,
Interpretation and Policy .02(a), to remove the word ``Pilot'' when
referring to the Short Term Option Series Program. The purpose of this
proposed change is to provide consistency and clarity throughout the
rule text as the Short Term Options Series Program is not a pilot
program.\3\
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\3\ See Exchange Rule 404, Interpretation and Policy .02.
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Next, the Exchange proposes to amend Exchange Rule 404,
Interpretation and Policy .02(c), to add the word ``thirty'' before the
number in parentheses in the first sentence for purposes of consistency
and clarity in the rule text.
Next, the Exchange proposes to amend Exchange Rule 404,
Interpretation and Policy .02(f), to add the number ``(21)'' after the
word ``twenty-one'' for purposes of consistency and clarity in the rule
text.
Next, the Exchange proposes to amend Exchange Rule 404,
Interpretation and Policy .10, to update the name of one of the
Exchange-Traded Funds (``ETF'') from ``PowerShares Trust (``QQQ'')'' to
its updated name ``Invesco QQQ Trust (``QQQ'').'' \4\ According to the
most recent Prospectus for the QQQ ETF, the ETF Sponsor changed that
ETF's name. Accordingly, the Exchange proposes to update the name of
the QQQ ETF for consistency with the QQQ ETF's Prospectus.
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\4\ See Invesco QQQ Trust, Series 1 Prospectus, dated January
31, 2021, <a href="https://connect.rightprospectus.com/Invesco/TADF/46090E103/P?site=ETF">https://connect.rightprospectus.com/Invesco/TADF/46090E103/P?site=ETF</a>.
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Next, the Exchange proposes to amend Exchange Rule 404,
Interpretation and Policy .11, to add the number ``(21)'' after the
word ``twenty-one'' for purposes of consistency and clarity in the rule
text.
Next, the Exchange proposes to amend subparagraph (b) of Exchange
Rule 404A to add quotation marks around the phrase ``Exchange Traded
Fund Shares'' for the sentence to be grammatically correct.
Next, the Exchange proposes to amend subparagraph (a) of Exchange
Rule 406, Long-Term Option Contracts, to add the number ``(10)'' after
the word ``ten'' for purposes of consistency and clarity in the rule
text.
Next, the Exchange proposes to amend subparagraphs (b)(i)-(iv) of
Exchange Rule 500, Access to and Conduct on the Exchange, to: (1)
Replace periods with semicolons; and (2) add the word ``and'' to
subparagraph (b)(iv) in the list for the sentence to be grammatically
correct. The Exchange proposes to replace the periods in (i)-(iv) for
the sentence to be grammatically correct and for purposes of clarity in
the rule text.
Next, the Exchange proposes to amend subparagraph (b)(1)(ii)(A) to
Exchange Rule 503, Openings on the Exchange, to remove the word ``or''
for purposes of clarity and consistency in the rule text.
Next, the Exchange proposes to amend Exchange Rule 515, Execution
of Orders, to make minor, non-substantive edits and clarifying changes
to the rule text in order to provide consistency and clarity within the
rule text. Exchange Rule 515(g)(3)(iv) currently contains several
references to the term ``Post-Only.'' However, there are two instances
in subparagraph (g)(3)(iv) of Exchange Rule 515 where the term ``Post-
Only'' is missing the hyphen connecting the two words. The Exchange now
proposes to amend paragraph (g)(3)(iv) to amend all references to
``Post-Only'' to add the hyphen where it is missing. The purpose of
these changes is to provide consistency and clarity throughout the rule
text.
Next, the Exchange proposes to amend Exchange Rule 519, MIAX Pearl
Order Monitor (``MOM''), to make minor, non-substantive edits and
clarifying changes to the rule text. The Exchange proposes to amend the
example in Exchange Rule 519(a)(3) to move the word ``not'' in clause
``(B)'' of that example. With the proposed change, clause ``(B)'' will
state as follows: ``(B) if the NBO is $0.10 an incoming limit order to
buy options for $0.15 will not be rejected; whereas if the NBO is $0.10
an incoming limit order to buy options for $0.35 will be rejected as
the limit price of the order is $0.25 greater than the NBO.''
Similarly, the Exchange proposes to amend the example in Exchange Rule
519(a)(4) to delete the extra word ``be'' in the last part of clause
``(B'') of that example. With the proposed change, clause ``(B)'' will
state as follows: ``(B) if the NBB is $0.30 an incoming limit order to
sell options for $0.15 will be rejected; whereas if the NBB is $0.30 an
incoming limit order to sell options for $0.20 will not be rejected as
the limit price of the order is not less than 50% of the NBB price.''
The purpose of these changes is to provide clarity in the rule text.
[[Page 55087]]
2. Statutory Basis
The Exchange believes that its proposed rule change is consistent
with Section 6(b) of the Act \5\ in general, and furthers the
objectives of Section 6(b)(5) of the Act \6\ in particular, in that it
is 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 facilitating
transactions in securities, to remove impediments to and perfect the
mechanisms of a free and open market and a national market system and,
in general, to protect investors and the public interest.
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\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(5).
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The Exchange believes the proposed changes promote just and
equitable principles of trade and remove impediments to and perfect the
mechanism of a free and open market and a national market system
because the proposed rule changes will provide greater clarity to
Members \7\ and the public regarding the Exchange's Rules. It is in the
public interest for rules to be accurate and concise so as to eliminate
the potential for confusion.
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\7\ The term ``Member'' means an individual or organization that
is registered with the Exchange pursuant to Chapter II of these
Rules for purposes of trading on the Exchange as an ``Electronic
Exchange Member'' or ``Market Maker.'' Members are deemed
``members'' under the Exchange Act. See Exchange Rule 100.
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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 not necessary or appropriate in
furtherance of the purposes of the Act. Specifically, the Exchange
believes the proposed changes will not impose any burden on intra-
market competition as there is no functional change to the Exchange's
System and because the rules of the Exchange apply to all MIAX Pearl
participants equally. The proposed rule change will have no impact on
competition as it is not designed to address any competitive issue but
rather is designed to remedy minor non-substantive issues and provide
added clarity to the rule text of Exchange Rules 100, 402, 403, 404,
404A, 406, 500, 503, 515, and 519. In addition, the Exchange does not
believe the proposal will impose any burden on inter-market competition
as the proposal does not address any competitive issues and is intended
to protect investors by providing further transparency regarding the
Exchange's functionality.
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
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) \8\ of the Act and Rule 19b-4(f)(6) thereunder.\9\
Because the foregoing proposed rule change does not: (i) Significantly
affect the protection of investors or the public interest; (ii) impose
any significant burden on competition; and (iii) become operative for
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, it has become effective pursuant to
Section 19(b)(3)(A)(iii) of the Act and subparagraph (f)(6) of Rule
19b-4 thereunder.\10\
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\8\ 15 U.S.C. 78s(b)(3)(A)(iii).
\9\ 17 CFR 240.19b-4(f)(6).
\10\ In addition, Rule 19b-4(f)(6)(iii) requires the Exchange to
give the Commission written notice of its intent to file the
proposed rule change at least five business days prior to the date
of filing of the proposed rule change, or such shorter time as
designated by the Commission. The Exchange has satisfied this
requirement.
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or 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
<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#e391968f86ce808c8e8e868d9790a3908680cd848c95"><span class="__cf_email__" data-cfemail="2b595e474e06484446464e455f586b584e48054c445d">[email protected]</span></a>. Please include
File Number SR-PEARL-2021-43 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-PEARL-2021-43. 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-PEARL-2021-43, and should be submitted
on or before October 26, 2021.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-21747 Filed 10-4-21; 8:45 am]
BILLING CODE 8011-01-P
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