Notice2024-07807
Submission for OMB Review; Comment Request; Extension: Rule 9b-1
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
April 12, 2024
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 89 Issue 72 (Friday, April 12, 2024)</title>
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[Federal Register Volume 89, Number 72 (Friday, April 12, 2024)]
[Notices]
[Pages 25905-25906]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-07807]
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SECURITIES AND EXCHANGE COMMISSION
[SEC File No. 270-429, OMB Control No. 3235-0480]
Submission for OMB Review; Comment Request; Extension: Rule 9b-1
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC
20549-2736
Notice is hereby given that pursuant to the Paperwork Reduction Act
of 1995 (``PRA'') (44 U.S.C. 3501 et seq.), the Securities and Exchange
Commission (``Commission'') has submitted to the Office of Management
and Budget (``OMB'') a request for approval of extension of the
previously approved collection of information provided for in Rule 9b-1
(17 CFR 240.9b-1), under the Securities Exchange Act of 1934 (15 U.S.C.
78a et seq.).
Rule 9b-1 (17 CFR 240.9b-1) sets forth the categories of
information required to be disclosed in an options disclosure document
(``ODD'') and requires the options markets to file an ODD with the
Commission 60 days prior to the date it is distributed to investors. In
addition, Rule 9b-1 provides that the ODD must be amended if the
information in the document becomes materially inaccurate or incomplete
and that amendments must be filed with the Commission 30 days prior to
the distribution to customers. Finally, Rule 9b-1 requires a broker-
dealer to furnish to each customer an ODD and any amendments prior to
accepting an order to purchase or sell an option on behalf of that
customer or when approving a customer's account for options trading.
[[Page 25906]]
There are 17 options markets \1\ that must comply with Rule 9b-1.
These respondents work together to prepare a single ODD covering
options traded on each market, as well as amendments to the ODD. These
respondents file approximately 3 amendments per year. The staff
calculates that the preparation and filing of amendments should take no
more than eight hours per options market. Thus, the total time burden
for options markets per year is approximately 408 hours (17 options
markets x 8 hours per amendment x 3 amendments per year). The estimated
cost for an in-house attorney is $483 per hour,\2\ resulting in a total
internal cost of compliance for these respondents of approximately
$197,064 per year (408 hours at $483 per hour).
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\1\ The seventeen options markets are as follows: BOX Exchange
LLC, Cboe BZX Exchange, Inc., Cboe C2 Exchange, Inc., Cboe EDGX
Exchange, Inc., Cboe Exchange, Inc., MEMX, LLC, Miami International
Securities Exchange LLC, MIAX Emerald, LLC, MIAX PEARL, LLC, Nasdaq
BX, Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC, Nasdaq
PHLX LLC, the Nasdaq Options Market (NOM), NYSE Arca, Inc., and NYSE
American LLC.
\2\ SIFMA did its last annual survey in 2013 and will not resume
the survey process. Accordingly, the $483 figure is based on the
2013 figure ($380) adjusted by the inflation rate calculated using
the Bureau of Labor Statistics' CPI Inflation Calculator. The $380
per hour figure for an Attorney is from SIFMA's Management &
Professional Earnings in the Securities Industry 2013, modified by
Commission staff to account for an 1800-hour work-year and
multiplied by 5.35 to account for bonuses, firm size, employee
benefits and overhead.
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In addition, approximately 955 broker-dealers \3\ must comply with
Rule 9b-1. Each of these respondents will process an average of 3 new
customers for options each week and, therefore, will have to furnish
approximately 156 ODDs per year. The postal mailing or electronic
delivery of the ODD takes respondents no more than 30 seconds to
complete for an annual compliance burden for each of these respondents
of approximately 78 minutes or 1.3 hours. Thus, the total time burden
per year for broker-dealers is approximately 1,242 hours (955 broker-
dealers x 1.3 hours). The estimated cost for a general clerk of a
broker-dealer is $81 per hour,\4\ resulting in a total internal cost of
compliance for these respondents of approximately $100,602 per year
(1,242 hours at $81 per hour).
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\3\ The estimate of 955 broker-dealers required to comply with
Rule 9b-1 is derived from Item 12 of the Form BD (OMB Control No.
3235-0012). This estimate may be high as it includes broker-dealers
that engage in only a proprietary business, and as a result are not
required to deliver an ODD, as well as those broker-dealers subject
to Rule 9b-1.
\4\ The $81 figure is based on the 2013 figure ($57) adjusted
for inflation. See supra note 2. As noted above, SIFMA did its last
annual survey in 2013 and will not resume the survey process.
Accordingly, the $81 figure is based on the 2013 figure ($57)
adjusted for inflation. The $57 per hour figure for a General Clerk
is from SIFMA's Office Salaries in the Securities Industry 2013,
modified by Commission staff to account for an 1800-hour work-year
and multiplied by 2.93 to account for bonuses, firm size, employee
benefits and overhead. The staff believes that the ODD would be
mailed or electronically delivered to customers by a general clerk
of the broker-dealer or some other equivalent position.
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The total time burden for all respondents under this rule (both
options markets and broker-dealers) is approximately 1,650 hours per
year (408 + 1,242), and the total internal cost of compliance is
approximately $297,666 per year ($197,064 + $100,602).
An agency may not conduct or sponsor, and a person is not required
to respond to, a collection of information under the PRA unless it
displays a currently valid OMB control number.
The public may view background documentation for this information
collection at the following website: <a href="http://www.reginfo.gov">www.reginfo.gov</a>. Find this
particular information collection by selecting ``Currently under 30-day
Review--Open for Public Comments'' or by using the search function.
Written comments and recommendations for the proposed information
collection should be sent by May 13, 2024 to (i) <a href="http://www.reginfo.gov/public/do/PRAMain">www.reginfo.gov/public/do/PRAMain</a> and (ii) David Bottom, Director/Chief Information
Officer, Securities and Exchange Commission, c/o John Pezzullo, 100 F
Street NE, Washington, DC 20549, or by sending an email to:
<a href="/cdn-cgi/l/email-protection#9dcdcfdcc2d0fcf4f1fff2e5ddeef8feb3faf2eb"><span class="__cf_email__" data-cfemail="015153405e4c60686d636e79417264622f666e77">[email protected]</span></a>.
Dated: April 9, 2024.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-07807 Filed 4-11-24; 8:45 am]
BILLING CODE 8011-01-P
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