Notice2022-14177
Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Allow Multi-Leg Qualified Open Outcry Orders (“QOO Orders”) That Are Not Complex Orders To Trade in Penny Increments Regardless of the Minimum Increments Otherwise Applicable to the Individual Legs of the Multi-Leg QOO Order
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
July 5, 2022
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 87 Issue 127 (Tuesday, July 5, 2022)</title>
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[Federal Register Volume 87, Number 127 (Tuesday, July 5, 2022)]
[Notices]
[Pages 39880-39884]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-14177]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-95173; File No. SR-BOX-2022-21]
Self-Regulatory Organizations; BOX Exchange LLC; Notice of Filing
and Immediate Effectiveness of a Proposed Rule Change To Allow Multi-
Leg Qualified Open Outcry Orders (``QOO Orders'') That Are Not Complex
Orders To Trade in Penny Increments Regardless of the Minimum
Increments Otherwise Applicable to the Individual Legs of the Multi-Leg
QOO Order
June 28, 2022.
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 June 17, 2022, BOX Exchange LLC (the ``Exchange'') filed with
the Securities and Exchange Commission (the ``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the Exchange. The Exchange filed the proposed
rule change pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and
Rule 19b-4(f)(6) thereunder.\4\ 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.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to allow multi-leg Qualified Open Outcry
Orders \5\ (``QOO orders'') that are not Complex Orders \6\ to trade in
penny increments regardless of the minimum increments otherwise
applicable to the individual legs of the multi-leg QOO order. The text
of the proposed rule change is available from the principal office of
the Exchange, at the Commission's Public Reference Room and also on the
Exchange's internet website at <a href="http://boxoptions.com">http://boxoptions.com</a>.
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\5\ See BOX Rule 7600(a)(4).
\6\ See BOX Rule 7240(a)(7).
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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 self-regulatory organization
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 self-regulatory organization
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 purpose of the proposed rule change is to amend BOX Options
Market LLC (``BOX'') Rule 7600 to allow multi-leg QOO orders that are
not Complex Orders to be quoted and executed in $0.01 increments
(``penny increments'') regardless of minimum increments otherwise
applicable to the individual legs of the multi-leg QOO order.
Currently, multi-leg QOO orders that are not Complex Orders respect the
minimum trading increment for the series of the option contracts traded
(e.g., $0.01, $0.05, $0.10).\7\ The Exchange now proposes to amend BOX
Rule 7600(c) to allow multi-leg QOO orders to be quoted and executed in
penny increments, regardless of the minimum increments otherwise
applicable to the individual legs of the order. BOX notes that this is
a competitive rule filing based on a similar proposal filed by Cboe
Exchange Inc. (``Cboe'') and approved by the Commission.\8\ Currently,
multi-leg QOO orders are only traded on the BOX Trading Floor.\9\ The
Exchange does not propose to allow multi-leg orders that are not
Complex Orders to trade electronically as detailed in the Cboe
filing.\10\ BOX only intends to allow multi-leg QOO orders on the BOX
Trading Floor to be quoted and traded in penny increments. BOX will
file a proposal with the Commission if it intends to allow multi-leg
orders to trade electronically. BOX does not generate Legging Orders on
behalf of multi-leg QOO orders. BOX generates Legging Orders only on
behalf of Complex Orders resting on the Complex Order Book.\11\
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\7\ BOX notes that a recent Cboe proposal suggested that BOX's
current rule is silent on the minimum increment for orders submitted
for execution on BOX's trading floor and that Cboe has been informed
by multiple market participants that are also members of BOX that
they may execute multi-legged orders (with ratios greater than
three-to-one or less than one-to-three) on BOX's trading floor in
penny increments. See Securities Exchange Act Release No. 94204
(February 9, 2022), 87 FR 8625 (February 15, 2022) (Notice of Filing
of Amendment No. 1 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Modified by Amendment No. 1, To Amend Cboe
Rule 5.4 and Make Corresponding Changes to Other Rules) (``Cboe
Order''). The Exchange reiterates that multi-leg QOO Orders
currently executed on the BOX Trading Floor are treated like single-
leg QOO Orders with respect to execution and priority. Further, and
contrary to the exchange's representations, each component series
(leg) of a multi-leg QOO order on the BOX Trading Floor respects the
minimum trading increment for the series of the option contracts
traded on the Exchange (e.g., $0.01, $0.05, $0.10). See BOX Comment
Letter to SR-CBOE-2021-046 available at <a href="https://www.sec.gov/comments/sr-cboe-2021-046/srcboe2021046-9238319-250622.pdf">https://www.sec.gov/comments/sr-cboe-2021-046/srcboe2021046-9238319-250622.pdf</a>.
\8\ See Cboe Order.
\9\ See BOX Rule 7600(a)(2).
\10\ See supra note 5. [sic]
\11\ See BOX Rule 7240(c).
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Background
Complex Orders are defined on BOX as any order involving the
simultaneous purchase and/or sale of two or more different options
series in the same underlying security, for the same account, in a
ratio that is equal to or greater than one-to-three (.333) and less
than or equal to three-to-one (3.00) and for the purpose of executing a
particular investment strategy.\12\ Bids and offers on Complex Orders
may be expressed in any decimal price, and the leg(s) of a Complex
Order may be executed in one penny increments, regardless of the
minimum increments otherwise
[[Page 39881]]
applicable to the individual legs of the order.\13\
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\12\ See BOX Rule 7240(a)(7).
\13\ See BOX Rule 7240(b)(1).
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Multi-leg QOO orders on the BOX Trading Floor differ from Complex
QOO Orders as they may have a ratio that is less than one-to-three
(.333) or greater than three-to-one (3.00). Further, multi-leg QOO
orders must involve the simultaneous purchase and/or sale of two or
more different options series in the same underlying security, for the
same account, and for the purpose of executing a particular investment
strategy. Each component series of a multi-leg QOO order must be
executed at a price that is equal to or better than the NBBO for that
series subject to the exceptions of BOX Rule 15010(b). Each component
series of a multi-leg QOO order (1) may not trade through any equal or
better priced Public Customer bids or offers on the BOX book for that
series or any non-Public Customer bids or offers on the BOX book for
that series that are ranked ahead of or equal to better priced Public
Customer bids or offers, and (2) may not trade through any non-Public
Customer bids or offers for that series on the BOX book that are priced
better than the proposed execution price.\14\
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\14\ See BOX Rule 7600(c).
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BOX notes that multi-leg QOO orders require special pricing and
handling. Bids and offers for multi-leg QOO orders are typically
represented on the basis of a total debit or credit for the order.
After a multi-leg QOO order executes at the total debit or credit, the
parties to the trade record the contract quantities and prices for each
component leg of the order. For multi-leg QOO orders executed in open
outcry, this task is straightforward when the total debit or credit for
a complex strategy is expressed in the minimum increment.\15\ However,
if a multi-leg QOO order is unable to be expressed in increments
smaller than the increment for the class (such as $0.05), it may be
difficult for Floor Participants to obtain the desired prices for their
customers' orders, because the parties on either side of the
transaction must perform extra calculations to break down a complex
order into the required contract quantities and prices to fit within
the constraint of executing multi-leg QOO orders at a minimum increment
other than $0.01.\16\ The result is that on active trading days,
brokers executing these types of orders cannot be as efficient in
representing other customer orders while spending time performing these
calculations.
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\15\ For example, assume the market for the November FB 225
calls is 31 bid, 32 asked, and the market for the November FB 245
calls is 19.50 bid and 20.50 asked. The fair value of a call spread
comprised of one leg to buy and one leg to sell the same number of
contracts of this series is 11.50 (the difference between the prices
quoted for each option). If an order to buy 100 of the 225 calls and
to sell 100 of the 245 calls is quoted and executed at a net debit
of 11.50 (expressed in a multiple of the minimum increment), the
parties to the trade can easily determine and record a price for
each component option that comprises the Multi-Leg Order. Any
combination of purchase and sale prices within the quoted ranges for
the component options that yield a net debit or credit of 11.50
could be used (e.g., 31.50 for the 225 calls, and 20 for the 245
calls).
\16\ Using the example in the previous footnote, if instead a
customer wants to pay 11.48 rather than 11.50 for a Multi-Leg Order,
in order to determine prices for the component options that are
expressed in a multiple of $0.05 the Floor Broker must perform a
series of calculations. In this case, the Floor Broker might
determine that the trade must be split up into a 40-contract spread
that traded at a net debit of 11.45 and a 60-contract spread that
traded at a net debit of 11.50, which together yield a net debit of
11.48 for the entire amount. This is ultimately a better net price
for the customer.
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The Exchange believes the proposed rule change will enable Floor
Brokers to execute multi-leg QOO Orders more efficiently, including on
behalf of customers that wish to execute highly complicated multi-leg
QOO orders, by permitting the parties to execute the trades more
expeditiously on the BOX Trading Floor. Additionally, the Exchange
believes the proposed rule change may give Floor Brokers the
flexibility to execute customers' multi-leg QOO orders with these
larger ratios at better prices, rather than executing at prices that
fit within the confines of a larger increment.
The Exchange notes that it does not propose to change the priority
rules for multi-leg QOO Orders. Specifically, each component series of
a multi-leg QOO order that is not a Complex Order must be executed at a
price that is equal to or better than the NBBO for that series subject
to the exceptions of BOX Rule 15010(b). Each component series of a
multi-leg QOO order (1) may not trade through any equal or better
priced Public Customer \17\ bids or offers on the BOX Book \18\ for
that series or any non-Public Customer bids or offers on the BOX Book
for that series that are ranked ahead of or equal to better priced
Public Customer bids or offers, and (2) may not trade through any non-
Public Customer bids or offers for that series on the BOX Book that are
priced better than the proposed execution price.\19\ Better or equal
priced Public Customer bids or offers are still protected along with
certain non-Public Customer bids or offers as described above. To
provide additional clarity with regard to how these bids and offers are
protected, the Exchange proposes to add language to BOX Rule 7600(c)
that states, ``the initiating side of a single leg QOO Order must
execute against equal or better priced interest on the BOX Book as
provided by Rules 7600(d) and (h) before executing against the contra-
side QOO Order.'' The Exchange also proposes to add language to BOX
Rule 7600(c) that states, ``The initiating side of a multi-leg QOO
order must execute against equal or better priced interest on the BOX
Book as provided by Rules 7600(d) and (h) before executing against the
contra-side QOO order.'' The Exchange believes the proposed language
will provide clarity with regard to the execution and priority for QOO
Orders on the BOX Trading Floor. The Exchange notes that the proposal
does not change the execution or priority of QOO orders on the BOX
Trading Floor.
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\17\ See BOX Rule 100(53).
\18\ See BOX Rule 100(10).
\19\ See BOX Rule 7600(c).
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The Exchange notes that Floor Brokers are responsible for handling
all orders in accordance with Exchange priority and trade-through
rules.\20\ Currently, pursuant to BOX Rule 7600(d), the initiating side
of the QOO Order will match against any bids or offers on the BOX Book
priced better than the contra-side, provided that an adequate book
sweep size was provided by the Floor Broker pursuant to Rule 7600(h).
If the number of contracts on the BOX Book that have priority over the
contra-side order is greater than the book sweep size, then the QOO
Order will be rejected.\21\ Similarly, at the same price as the contra-
side of the QOO Order, the initiating side of the QOO Order will match
against Public Customer Orders on the BOX Book, along with any bids or
offers of non-Public Customers ranked ahead of such Public Customer
Orders on the BOX Book.\22\ In other words, BOX Rules 7600(c) and
7600(d) establish the priority rules and BOX Rule 7600(h) provides a
mechanism for fulfilling the requirements of these rules. Further, if a
Floor Broker attempts to enter an order without providing an adequate
book sweep size, the order will be rejected thus protecting higher
priority orders on the BOX Book including Public Customer orders on the
BOX Book.
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\20\ See BOX Rule 7600(a).
\21\ See BOX Rule 7600(h).
\22\ See BOX Rule 7600(d)(2).
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The Securities and Exchange Commission (``Commission''), on
December 1, 2003, provided: ``Because of concerns that a higher ratio
could provide market participants with a means to enter a ratio order
that was designed primarily to gain priority over
[[Page 39882]]
orders on the limit order book or in the trading crowd, rather than to
effectuate a bona fide trading or hedging strategy, the Commission
would need to examine closely any proposal to provide a higher ratio
for ratio orders and would be concerned about whether such a proposal
would be consistent with investor protection and the public interest
under the Act.'' \23\ While BOX allows Complex Orders to execute at a
price that is equal to or better than the BOX BBO for each of the
component series, among other conditions,\24\ the same is not true of
multi-leg QOO Orders that are not Complex Orders. No change is being
proposed to the priority of higher ratio orders, which allows Public
Customer orders (among others) to remain protected, thus alleviating
the Commission's concern about giving priority to higher ratio orders.
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\23\ See Securities Exchange Act Release No. 48858 (December 1,
2003), 68 FR 68128 (December 5, 2003) (SR-CBOE-2003-07).
\24\ See BOX Rule 7240(b)(3)(iii).
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The proposed rule change seeks to allow the execution of the legs
of multi-leg QOO orders that are not Complex Orders in penny
increments, regardless of the minimum increments otherwise applicable
to the individual legs of the order as is currently allowed for Complex
Orders.\25\ The Exchange understands that there may be some concerns
that if the ratios are too greatly expanded, market participants will,
for example, enter multi-legged strategies designed primarily to trade
orders in a class in pennies that cannot otherwise execute as simple
orders in that class in pennies rather than to effectuate a bona fide
trading or hedging strategy. The Exchange believes it is highly
unlikely that market participants will submit non-bona-fide trading
strategies with larger ratios just to trade in penny increments. Adding
a single leg to a larger order just to obtain penny pricing may further
reduce execution opportunities for such an order, because it may be
less likely that sufficient contracts in the appropriate ratio would be
available. Additionally, as proposed, multi-leg QOO orders may not
trade through any equal or better priced Public Customers on the BOX
Book.\26\ Complex QOO Orders may trade at a price without giving
priority to equivalent bids or offers in the individual series legs,
provided that at least one options leg betters the corresponding bid or
offer on the BOX Book by at least one minimum increment.\27\ However,
Complex Order priority does not apply to multi-leg QOO orders.\28\
Therefore, if a market participant were to attempt to submit a multi-
leg QOO order primarily to trade in penny increments, it may need to
improve more legs than a Complex Order, reducing any potential savings
the market participant was attempting to achieve.
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\25\ See BOX Rule 7240(b)(1).
\26\ See BOX Rule 7600(c).
\27\ See id.
\28\ See 7600(c) and (d).
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Further, the Exchange notes that the majority of volume traded on
the Exchange in both simple and Complex Orders already trades in penny
increments. Further, the Exchange notes that all option series traded
on BOX can trade in penny increments in the Price Improvement Period
(``PIP'') regardless of the minimum increment otherwise applicable.\29\
Therefore, the Exchange does not believe that permitting multi-leg QOO
orders that are not Complex Orders to trade in penny increments will
materially impact the volume that already executes in pennies on BOX.
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\29\ See BOX Rules 7150(f)(2), 7150(k).
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The Exchange again notes that another options exchange has similar
rules that were recently approved by the Commission.\30\
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\30\ See Cboe Rule 5.4(b).
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Lastly, the Exchange proposes to amend Rule 7600(h) to add language
that was inadvertently omitted when the Exchange established the rule.
Specifically, BOX proposes to state that, ``A Floor Broker may, but is
not required to, provide a book sweep size for Complex QOO Orders and
multi-leg QOO orders. The book sweep size is the number of contracts,
if any, of the initiating side of the Complex QOO Order or multi-leg
QOO Order that the Floor Broker is willing to relinquish to orders and
quotes on the BOX Complex Order Book and the BOX Book that have
priority pursuant to Rule 7240(b)(2) and (3) and Rule 7600(c) (changes
italicized). The Exchange believes that adding this language will
provide clarity with respect to the book sweep size functionality and
the multi-leg QOO orders on the BOX Trading Floor.
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act,\31\ in general, and Section
6(b)(5) of the Act,\32\ in particular, the 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 the Section 6(b)(5) requirement that the rules of an
exchange not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers. In particular, the Exchange
believes the proposed rule change will remove impediments to and
perfect the mechanism of a free and open market and benefit investors,
because it will provide market participants with the same pricing
flexibility with respect to all their complex trading and hedging
strategies. Market participants may determine that investment and
hedging strategies on the BOX Trading Floor with ratios greater than
three-to-one or less than one-to-three are appropriate for their
investment purposes, and the Exchange believes it will benefit market
participants if they have additional flexibility to price their
investment and hedging strategies to achieve their desired investment
results. The Exchange believes the proposed rule change will help
protect investors by allowing market participants to receive the
benefit of complex order pricing when executing bona fide multi-legged
trading or hedging strategies. The Exchange sees no reason to restrict
complex orders with a ratio of greater three-to-one (or less than one-
to-three) in a class with a minimum increment of $0.05 from being
expressed in, or having their legs execute in, $0.01 increments while
legs of Complex Orders with a ratio less than or equal to three-to-one
(or greater than or equal to one-to-three) in the same class may be
expressed in, and have their legs execute in, $0.01 increments. The
proposed rule change will further remove impediments to and perfect the
mechanism of a free and open market and a national market system, as
another options exchange permits multi-leg orders with any ratio and
their legs to trade in pennies.\33\ These changes will also enable
Floor Brokers on the BOX Trading Floor to more efficiently execute
multi-leg QOO orders including on behalf of customers that wish to
execute highly complicated multi-leg QOO orders, by permitting the
parties to execute the trades more expeditiously. Additionally, as
discussed above, this may enable Floor Brokers to execute customers'
multi-leg
[[Page 39883]]
QOO orders at better prices, rather than executing at prices that fit
within the confines of a larger increment, which ultimately benefits
investors. The proposed rule change will continue to protect Public
Customer order interest on the BOX Book in the same manner it does
today, as all multi-leg QOO orders that are not Complex Orders may not
trade through any equal or better priced Public Customer bids or offers
on the BOX Book for that series or any non-Public Customer bids or
offers on the BOX Book for that series that are ranked ahead of or
equal to better priced Public Customer bids or offers, and may not
trade through any non-Public Customer bids or offers for that series on
the BOX Book that are priced better than the proposed execution price.
As such, BOX believes the proposed rule change is in the public
interest, and therefore, consistent with the Act.
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\31\ 15 U.S.C. 78f(b).
\32\ 15 U.S.C. 78f(b)(5).
\33\ See supra note 28. [sic]
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Further, the Exchange believes that the proposed language in
7600(c) regarding single-leg QOO orders and multi-leg QOO orders will
provide clarity with regard to the execution and priority for these QOO
Orders on the BOX Trading Floor. As such, BOX believes the proposed
rule change is in the public interest, and therefore, 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 that is not necessary or appropriate
in furtherance of the purposes of the Act. The Exchange does not
believe the proposed rule change will impose any burden on intramarket
competition, as the proposed rule change will apply in the same manner
to all Participants (i.e., all Participants may submit multi-leg QOO
orders in penny increments). The Exchange does not believe the proposed
rule change will impose any burden on intermarket competition, as it
relates to the representation and execution of orders on the BOX
Trading Floor and will continue to protect Public Customer Orders on
the BOX Book. The Exchange believes the proposed rule change may
promote competition, as market participants will have additional
flexibility to execute their trading and hedging strategies in a more
efficient manner as it will permit multi-leg QOO orders in the same
class to trade in the same increments as Complex QOO Orders.
Additionally, as discussed herein, another options market currently
permits complex orders with ratios greater than three-to-one or less
than one-to-three and their legs to execute in penny increments on its
trading floor.\34\ Further, the Exchange believes that the proposed
language in 7600(c) will not impose any burden on competition that is
not necessary or appropriate in furtherance of the purposes of the Act
as the proposed changes will provide clarity with regard to the
execution and priority for these QOO Orders on the BOX Trading Floor.
As such, 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.
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\34\ Id. [sic].
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange has neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not (a)
significantly affect the protection of investors or the public
interest; (b) impose any significant burden on competition; and (c)
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) of the Act \35\ and Rule 19b-
4(f)(6) \36\ 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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\35\ 15 U.S.C. 78s(b)(3)(A).
\36\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) \37\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\38\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay. The Exchange states
that another options exchange currently allows all complex orders to be
quoted and executed in $0.01 increments, and that waiving the operative
delay period will allow BOX to immediately provide investors with an
additional venue to transact larger-ratio multi-leg QOO orders in $0.01
increments.\39\ The Exchange further states that the proposal could
allow Floor Brokers to execute complicated multi-leg QOO Orders more
efficiently and expeditiously on the BOX Trading Floor and provide
Floor Brokers with flexibility to execute customers' multi-leg QOO
orders at better prices, rather than at prices that fit within the
confines of a larger increment. The Exchange states that the proposed
changes to BOX Rule 7600(c) will reduce potential investor confusion
with regard to the execution and priority of QOO Orders on the BOX
Trading floor, and that the proposed changes to BOX Rule 7600(h) will
add language that was inadvertently omitted when the Exchange adopted
the rule. The Commission finds that waiving the 30-day operative delay
is consistent with the protection of investors and the public interest.
The Commission notes that proposal does not raise new or novel
regulatory issues because another options exchange currently allows all
complex orders, including complex orders with a ratio less than one-to-
three or greater than three-to-one, to be quoted and executed in $0.01
increments.\40\ Waiver of the operative delay will allow the Exchange
to provide investors with an additional venue for quoting and executing
larger-ratio complex orders in $0.01 increments. The Commission
believes that the proposed changes to BOX Rule 7600(c) will benefit
investors by helping to clarify the priority requirements applicable to
QOO Orders, and that the proposed changes to BOX Rule 7600(h) will
clarify that rule by adding language regarding multi-leg QOO Orders
that was inadvertently omitted from the rule. For these reasons, the
Commission designates the proposal operative upon filing.\41\
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\37\ 17 CFR 240.19b-4(f)(6).
\38\ 17 CFR 240.19b-4(f)(6)(iii).
\39\ See Cboe Rule 5.4(b). See also Cboe Order, supra note 7.
\40\ See id.
\41\ For purposes only of accelerating the operative date of
this proposal, the Commission has considered the proposed rule's
impact on efficiency, competition, and capital formation. 15 U.S.C.
78c(f).
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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
[[Page 39884]]
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#d5a7a0b9b0f8b6bab8b8b0bba1a695a6b0b6fbb2baa3"><span class="__cf_email__" data-cfemail="4735322b226a24282a2a222933340734222469202831">[email protected]</span></a>. Please include
File Number SR-BOX-2022-21.
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-BOX-2022-21. 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-BOX-2022-21, and should be submitted on
or before July 26, 2022.
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\42\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\42\
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2022-14177 Filed 7-1-22; 8:45 am]
BILLING CODE 8011-01-P
</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>Indexed from Federal Register on July 5, 2022.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.