Notice2022-10262
Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fee Schedule for the Priority Customer Rebate Program
Primary source
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
May 13, 2022
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 87 Issue 93 (Friday, May 13, 2022)</title>
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[Federal Register Volume 87, Number 93 (Friday, May 13, 2022)]
[Notices]
[Pages 29421-29423]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-10262]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-94878; File No. SR-MIAX-2022-18]
Self-Regulatory Organizations; Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Amend Its Fee Schedule for the Priority
Customer Rebate Program
May 9, 2022.
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 April 29, 2022, Miami International Securities
Exchange LLC (``MIAX'' or ``Exchange'') filed with the Securities and
Exchange Commission (``Commission'') a 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
The Exchange is filing a proposal to amend the MIAX Options Fee
Schedule (the ``Fee Schedule'').
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>, at MIAX'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 footnote 14 referenced in Section
1)a)iii) of the Fee Schedule to amend the list of MIAX Select Symbols
\3\ contained in the Priority Customer Rebate Program (``PCRP'') \4\ to
remove symbol ``AIG,'' (American International Group, Inc.) from the
Select Symbols list.
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\3\ The term ``MIAX Select Symbols'' means options overlying
AAL, AAPL, AIG, AMAT, AMD, AMZN, BA, BABA, BB, BIDU, BP, C, CAT,
CLF, CVX, DAL, EBAY, EEM, FB, FCX, GE, GILD, GLD, GM, GOOGL, GPRO,
HAL, INTC, IWM, JNJ, JPM, KMI, KO, MO, MRK, NFLX, NOK, ORCL, PBR,
PFE, PG, QCOM, QQQ, RIG, SPY, T, TSLA, USO, VALE, WBA, WFC, WMB, X,
XHB, XLE, XLF, XLP, XOM and XOP.
\4\ See section 1)a)iii) of the Fee Schedule for a complete
description of the PCRP.
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The Exchange initially created the list of MIAX Select Symbols on
March 1, 2014,\5\ and has added and removed option classes from that
list since that time.\6\ Select Symbols are rebated slightly higher in
certain PCRP tiers and segment than non-Select Symbols. The Exchange
notes that historically, Select Symbols generally include a subset of
classes of options that are included in the Penny Interval Program, an
industry-wide program that provides for the quoting and trading of
certain option classes in penny increments (the ``Penny Program'').\7\
The Penny Program allows the quoting and trading of certain option
classes in minimum increments of $0.01 for all series in such option
classes with a price of less than $3.00; and in minimum increments of
$0.05 for all series in such option classes with a price of $3.00 or
higher. The Penny Program was initiated as a pilot program at the then
existing option exchanges in January 2007,\8\ was made a permanent
program in 2020, and currently includes more than 300 of the most
actively traded option classes.
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\5\ See Securities Exchange Act Release No. 71700 (March 12,
2014), 79 FR 15188 (March 18, 2014) (SR-MIAX-2014-13).
\6\ See Securities Exchange Act Release Nos. 89530 (August 12,
2020), 85 FR 50845 (August 18, 2020) (SR-MIAX-2020-26); 88850 (May
11, 2020), 85 FR 29497 (May 15, 2020) (SR-MIAX-2020-09); 87964
(January 14, 2020), 85 FR 3435 (January 21, 2020) (SR-MIAX-2020-01);
87790 (December 18, 2019), 84 FR 71037 (December 26, 2019) (SR-MIAX-
2019-49); 85314 (March 14, 2019), 84 FR 10359 (March 20, 2019) (SR-
MIAX-2019-07; 81998 (November 2, 2017), 82 FR 51897 (November 8,
2017) (SR-MIAX-2017-45); 81019 (June 26, 2017), 82 FR 29962 (June
30, 2017) (SR-MIAX-2017-29); 79301 (November 14, 2016), 81 FR 81854
(November 18, 2016) (SR-MIAX-2016-42); 74291 (February 18, 2015), 80
FR 9841 (February 24, 2015) (SR-MIAX-2015-09); 74288 (February 18,
2015), 80 FR 9837 (February 24, 2015) (SR-MIAX-2015-08); 73328
(October 9, 2014), 79 FR 62230 (October 16, 2014) (SR-MIAX-2014-50);
72567 (July 8, 2014), 79 FR 40818 (July 14, 2014) (SR-MIAX-2014-34);
72356 (June 10, 2014), 79 FR 34384 (June 16, 2014) (SR-MIAX-2014-
26); 71700 (March 12, 2014), 79 FR 15188 (March 18, 2014) (SR-MIAX-
2014-13).
\7\ See Securities Exchange Act Release No. 88988 (June 2,
2020), 85 FR 35153 (June 8, 2020) (SR-MIAX-2020-13). See also
Exchange Rule 510(c).
\8\ See Securities Exchange Act Release Nos. 55154 (January 23,
2007), 72 FR 4743 (February 1, 2007) (SR-CBOE-2006-92); 55161
(January 24, 2007), 72 FR 4754 (February 1, 2007) (SR-ISE-2006-62);
54886 (December 6, 2006), 71 FR 74979 (December 13, 2006) (SR-Phlx-
2006-74); 54590 (October 12, 2006), 71 FR 61525 (October 18, 2006)
(SR-NYSEArca-2006-73); and 54741 (November 9, 2006), 71 FR 67176
(November 20, 2006) (SR-Amex-2006-106).
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On March 31, 2022, the Exchange issued an alert that the Select
symbol ``AIG'' would no longer be included in the Penny Program
industry-wide as of April 1, 2022.\9\ Accordingly, for business and
competitive reasons, the Exchange proposes to amend the Fee Schedule to
remove the symbol ``AIG'' from the list of MIAX Select Symbols
contained in the PCRP as that Select
[[Page 29422]]
Symbol is no longer in the Penny Program.
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\9\ See MIAX Listing Alert (March 31, 2022), available at
<a href="https://www.miaxoptions.com/alerts/2022/03/31/miax-exchange-group-options-markets-option-classes-be-removed-penny-interval">https://www.miaxoptions.com/alerts/2022/03/31/miax-exchange-group-options-markets-option-classes-be-removed-penny-interval</a>.
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Implementation
The proposed change is effective beginning May 1, 2022.
2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \10\ in general, and
furthers the objectives of Section 6(b)(4) of the Act \11\ in
particular, in that it is an equitable allocation of reasonable fees
and other charges among its members and issuers and other persons using
its facilities. The Exchange also believes the proposal furthers the
objectives of Section 6(b)(5) of the Act in that it is 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, in general to protect investors and the public
interest and is not designed to permit unfair discrimination between
customers, issuers, brokers and dealers.
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\10\ 15 U.S.C. 78f(b).
\11\ 15 U.S.C. 78f(b)(4) and (5).
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The Exchange believes the proposal to remove the symbol ``AIG''
from the list of MIAX Select Symbols contained in the PCRP is
consistent with Section 6(b)(4) of the Act because the proposed change
will allow for continued benefit to investors by providing them an
updated list of MIAX Select Symbols contained in the PCRP on the Fee
Schedule.
The Exchange believes that the proposal to amend an option class
that qualifies for the credit for transactions in MIAX Select Symbols
is fair, equitable and not unreasonably discriminatory. The Exchange
believes that the PCRP itself is reasonably designed because it
incentivizes providers of Priority Customer \12\ order flow to send
that Priority Customer order flow to the Exchange in order to receive a
credit in a manner that enables the Exchange to improve its overall
competitiveness and strengthen its market quality for all market
participants. The Exchange believes the PCRP, which provides increased
incentives in certain tiers in high volume select symbols, is also
reasonably designed to increase the competitiveness of the Exchange
with other options exchanges that also offer increased incentives to
higher volume symbols.
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\12\ The term ``Priority Customer'' means a person or entity
that (i) is not a broker or dealer in securities, and (ii) does not
place more than 390 orders in listed options per day on average
during a calendar month for its own beneficial account(s). See
Exchange Rule 100.
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The Exchange also believes that its proposal is consistent with
Section 6(b)(5) of the Act because it will apply equally to all
similarly situated Priority Customer orders in MIAX Select Symbols in
the PCRP. All similarly situated Priority Customer orders in MIAX
Select Symbols are subject to the same rebate schedule, and access to
the Exchange is offered on terms that are not unfairly discriminatory.
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 Act. The proposed
rule change should enable the Exchange to continue to attract and
compete for order flow with other exchanges. Notwithstanding the
removal of the symbol ``AIG'' from the Select Symbols list, the
Exchange's rebates remain highly competitive with those of other
exchanges, and therefore should enable the Exchange to continue to
attract and compete for order flow with other exchanges which offer
comparable rebates for particular symbols. The Exchange notes that it
operates in a highly competitive market in which market participants
can readily favor competing venues if they deem fee levels at a
particular venue to be excessive. In such an environment, the Exchange
must continually adjust its fees and rebates to remain competitive with
other exchanges and to attract order flow.
Further, the Exchange does not believe that its proposal to delete
the symbol ``AIG'' from the list of MIAX Select Symbols contained in
the PCRP will result in any burden on intra-market or inter-market
competition that is not necessary or appropriate in furtherance of the
purposes of the Act. This proposed change is a not a competitive
proposal but rather is designed to update the list of MIAX Select
Symbols contained in the PCRP in order to avoid potential confusion on
the part of market participants and other competing options exchanges.
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 foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\13\ and Rule 19b-4(f)(2) \14\ 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 shall institute proceedings to determine whether
the proposed rule should be approved or disapproved.
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\13\ 15 U.S.C. 78s(b)(3)(A)(ii).
\14\ 17 CFR 240.19b-4(f)(2).
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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
<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#a0d2d5ccc58dc3cfcdcdc5ced4d3e0d3c5c38ec7cfd6"><span class="__cf_email__" data-cfemail="a2d0d7cec78fc1cdcfcfc7ccd6d1e2d1c7c18cc5cdd4">[email protected]</span></a>. Please include
File Number SR-MIAX-2022-18 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-MIAX-2022-18. 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
[[Page 29423]]
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-
MIAX-2022-18, and should be submitted on or before June 3, 2022.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-10262 Filed 5-12-22; 8:45 am]
BILLING CODE 8011-01-P
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