Notice2025-06913
Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend MIAX Pearl Options Rule 208, MIAX Pearl Billing System, and MIAX Pearl Equities Rule 3002, Collection of Exchange Fees and Other Claims and Billing Policy
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 23, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 77 (Wednesday, April 23, 2025)</title>
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[Federal Register Volume 90, Number 77 (Wednesday, April 23, 2025)]
[Notices]
[Pages 17104-17107]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-06913]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-102878; File No. SR-PEARL-2025-13]
Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing
and Immediate Effectiveness of a Proposed Rule Change To Amend MIAX
Pearl Options Rule 208, MIAX Pearl Billing System, and MIAX Pearl
Equities Rule 3002, Collection of Exchange Fees and Other Claims and
Billing Policy
April 17, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Exchange Act'' or ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on April 3, 2025, MIAX PEARL, LLC (``MIAX Pearl''
or ``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 proposes to: (1) amend Exchange Rule 208, MIAX Pearl
Billing System, to enable the Exchange, upon request by the Member \3\
and approval by the Exchange, to permit an Exchange Member to provide
alternative payment instructions for purposes of the Exchange's direct
debit process for the collection of fees and other monies due and owing
to the Exchange; and (2) amend MIAX Pearl Equities Rule 3002,
Collection of Exchange Fees and Other Claims and Billing Policy, to
enable MIAX Pearl Equities, upon request by the Equity Member \4\ and
approval by MIAX Pearl Equities, to permit an Equity Member to provide
alternative payment instructions for purposes of MIAX Pearl Equities'
direct debit process for the collection of fees and other monies due
and owing to MIAX Pearl Equities.
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\3\ The term ``Member'' means an individual or organization that
is registered with the Exchange pursuant to Chapter II of the
Exchange's 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.
\4\ The term ``Equity Member'' is a Member authorized by the
Exchange to transact business on MIAX Pearl Equities. See Exchange
Rule 1901.
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The text of the proposed rule change is available on the Exchange's
website at <a href="https://www.miaxglobal.com/markets/us-equities/pearl-equities/rule-filings">https://www.miaxglobal.com/markets/us-equities/pearl-equities/rule-filings</a>, 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, MIAX Pearl 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. MIAX Pearl 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: (1) amend Exchange Rule 208, MIAX Pearl
Billing System, to enable the Exchange, upon request by the Member and
approval by the Exchange, to permit an Exchange Member to provide
alternative payment instructions (i.e., other than the designated
Clearing Member's \5\ account number at the Clearing Corporation,\6\ as
currently required by Exchange Rule
[[Page 17105]]
208) for purposes of the Exchange's direct debit process for the
collection of fees and other monies due and owing to the Exchange; and
(2) amend MIAX Pearl Equities Rule 3002, Collection of Exchange Fees
and Other Claims and Billing Policy, to enable MIAX Pearl Equities,
upon request by the Equity Member and approval by MIAX Pearl Equities,
to permit an Equity Member to provide alternative payment instructions
(i.e., other than the clearing account number for an account at the
National Securities Clearing Corporation (``NSCC''), as currently
required by MIAX Pearl Equities Rule 3002) for purposes of MIAX Pearl
Equities' direct debit process for the collection of fees and other
monies due and owing to MIAX Pearl Equities.
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\5\ The term ``Clearing Member'' means a Member that has been
admitted to membership in the Clearing Corporation pursuant to the
provisions of the rules of the Clearing Corporation. See Exchange
Rule 100.
\6\ The term ``Clearing Corporation'' means The Options Clearing
Corporation. Id.
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Currently, Exchange Rule 208 provides that every Member must
designate a Clearing Member for the payment of the Member's Exchange
invoices and vendor invoices for Exchange-related services assessed by
the Exchange by means of the Exchange's MIAX Pearl Billing System
(``PBS''). The designated Clearing Member shall pay to the Exchange on
a timely basis the full amount of each monthly Exchange invoice. Such
payments shall be drafted by the Exchange against the designated
Clearing Member's account at the Clearing Corporation.
The proposed rule change to Exchange Rule 208 would provide that
the Exchange will, upon request, waive the requirement for a Member to
designate a Clearing Member and instead require such Member to provide
alternative payment instructions as agreed to by the Exchange for
purposes of permitting the Exchange to debit certain fees, as
determined by the Exchange; provided, however, that the Exchange
reserves the right to require any such Member to designate a Clearing
Member for such purposes as set forth above if the Exchange encounters
repeated failed collection attempts using such alternative payment
instructions.
Currently, MIAX Pearl Equities Rule 3002 provides that every Equity
Member, and all applicants for registration as such, must provide a
clearing account number at NSCC for purposes of permitting MIAX Pearl
Equities to debit any undisputed or final fees, fines, charges and/or
other monetary sanctions or other monies due and owing to MIAX Pearl
Equities, or other charges pursuant to MIAX Pearl Equities Rule 3000,
including the MIAX Pearl Equities Fee Schedule; Regulatory Transaction
fees pursuant to MIAX Pearl Equities Rule 3000(b); dues, assessments
and other charges pursuant to MIAX Pearl Equities Rules 1202 and 1203
to the extent MIAX Pearl Equities was to determine to charge such fees;
and fines, sanctions and other charges pursuant to Chapters IX, X, and
XI of the Exchange Rulebook which are due and owing to MIAX Pearl
Equities.
The proposed rule change to MIAX Pearl Equities Rule 3002 would
provide that MIAX Pearl Equities will, upon request, waive the
requirement for an Equity Member to provide a clearing account number
for an account at the NSCC and instead require such Equity Member to
provide alternative payment instructions as agreed to by the Exchange
for purposes of permitting the Exchange to debit certain fees, as
determined by the Exchange; provided, however, that the Exchange
reserves the right to require any such Equity Member to provide a
clearing account number for an account at the NSCC for such purposes as
set forth above if the Exchange encounters repeated failed collection
attempts using such alternative payment instructions.
The purpose of the proposed changes is to provide the Exchange and
MIAX Pearl Equities with the flexibility to agree to an alternative
payment arrangement with a Member (or Equity Member, as the case may
be) if such Member (or Equity Member) so requests, as the Exchange
understands that certain Members (or Equity Members) may have an
operational burden associated with remitting payment to the Exchange
through a Clearing Member's account with the Clearing Corporation, or
through a designated clearing account number at NSCC. Under the
proposed rule changes, any such alternative payment instructions must:
(i) be agreed to by the Exchange (or MIAX Pearl Equities) for a
specified fee; and (ii) permit the Exchange (or MIAX Pearl Equities) to
initiate the debit of any fees and other monies due and owing to the
Exchange (or MIAX Pearl Equities) in a manner similar to the current
requirements with respect to a Clearing Member's account with the
Clearing Corporation or by providing a clearing account number for an
account at NSCC (i.e., a direct debit process). The requirement that
such alternative payment instructions must be agreed to by the Exchange
(or MIAX Pearl Equities) is intended to be an objective standard, and
the Exchange's ability to agree to such alternative payment
instructions would be exercised uniformly with respect to any Member
(or Equity Member) that so requests to the extent such alternative
payment instructions reasonably appear to permit the Exchange (or MIAX
Pearl Equities) to utilize a direct debit process for a certain fee.
The Exchange notes that several exchanges provide for substantively
similar alternative payment provisions in their billing rules for
equity members that may want to pay exchange fees via an alternative
method.\7\
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\7\ See, e.g., MEMX LLC (``MEMX'') Rule 15.3; NYSE American LLC
(``NYSE American'') Rule 41(a); NYSE Arca, Inc. (``NYSE Arca'') Rule
3.7.
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2. Statutory Basis
The Exchange believes that the proposed rule changes are consistent
with Section 6(b) of the Act,\8\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\9\ in particular, in that
they are 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.
The Exchange also believes the proposed rule changes are consistent
with the Section 6(b)(5) \10\ requirement that the rules of an exchange
not be designed to permit unfair discrimination between customers,
issuers, brokers, or dealers. Additionally, the Exchange believes the
proposed rule changes are consistent with the Section 6(b)(1) \11\
requirement that it be so organized and have the capacity to be able to
carry out the purposes of the Act and to comply, and to enforce
compliance by its Members and Equity Members and persons associated
with its Members and Equity Members, with the provisions of the Act,
the rules and regulations thereunder, and the Exchange's Rules.
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\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
\10\ Id.
\11\ 15 U.S.C. 78(b)(1).
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The Exchange believes the proposed change to enable the Exchange
(or MIAX Pearl Equities), upon request, to permit a Member (or Equity
Member) to provide alternative payment instructions (i.e., other than
the Clearing Member's account number with the Clearing Corporation, as
currently required by Exchange Rule 208, or by providing a clearing
account number for an account at NSCC, as currently required by MIAX
Pearl Equities Rule 3002) for purposes of the Exchange's direct debit
collection process is appropriate and consistent with Section
[[Page 17106]]
6(b)(1) of the Act,\12\ as such changes would provide the Exchange (and
MIAX Pearl Equities) with the flexibility to agree to an alternative
payment arrangement with a Member (or Equity Member) that has an
operational burden associated with remitting payment to the Exchange
(or MIAX Pearl Equities) through a Clearing Member's account with the
Clearing Corporation, or by providing a clearing account number for an
account at NSCC. The Exchange believes this will enable it to be so
organized and have the capacity to be able to carry out the purposes of
the Act and to comply, and to enforce compliance by its Members (and
Equity Members) and persons associated with its Members (and Equity
Members), with the Exchange's Rules relating to payment of fees and
other monies due and owing to the Exchange and MIAX Pearl Equities. The
Exchange also believes that reserving the right to revert to the
general rule (i.e., to require a Clearing Member's account number with
the Clearing Corporation, or by providing a clearing account number for
an account at NSCC, for direct debit purposes) with respect to any such
Member (or Equity Member) if the Exchange encounters repeated failed
collection attempts using such alternative payment instructions is
appropriately designed to ensure that it is able to collect the fees
and other monies due and owing to the Exchange through its standard
collection process if warranted, and is thus consistent with the Act
for similar reasons.
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\12\ 15 U.S.C. 78(b)(1).
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Additionally, these proposed changes are designed to give the
Exchange and its Members (and Equity Members) flexibility regarding
their payment arrangements while providing a safeguard by which the
Exchange may revert to its standard collection process, the Exchange
believes it would promote just and equitable principles of trade,
foster cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, remove impediments to and
perfect the mechanism of a free and open market and a national market
system, and, in general, protect investors and the public interest. The
proposed changes are also equitable and not unfairly discriminatory
because they are based on objective standards and would apply equally
to all Members and Equity Members for registration as such, as
described above.
The proposed changes are also based on billing and collection rules
in place at several equity exchanges, which provide for substantively
similar alternative payment provisions in their billing rules for
equity members that may want to pay exchange fees via an alternative
method.\13\
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\13\ See supra note 8.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposal will impose any
burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. The proposed change to enable
the Exchange to agree to alternative payment instructions for the
Exchange's direct debit collection process would apply equally to all
Members and Equity Members as the opportunity to request that the
Exchange agree to alternative payment instructions will be available to
any such Member or Equity Member and the Exchange's ability to agree to
such alternative payment instructions would be exercised uniformly on
an objective basis.
The Exchange does not believe such proposed changes would impair
the ability of Members or Equity Members or competing order execution
venues to maintain their competitive standing in the financial markets,
and therefore, the Exchange does not believe the proposal will impose
any burden on intermarket competition. Moreover, because the proposed
changes would apply equally to all Members and Equity Members, the
Exchange does not believe the proposal would impose any burden on
intramarket competition.
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
Pursuant to Section 19(b)(3)(A) of the Act \14\ and Rule 19b-
4(f)(6) \15\ thereunder, the Exchange has designated this proposal as
one that effects a change that: (i) does not significantly affect the
protection of investors or the public interest; (ii) does not impose
any significant burden on competition; and (iii) by its terms, does not
become operative for 30 days after the date of the filing, or such
shorter time as the Commission may designate if consistent with the
protection of investors and the public interest.
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) \16\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\17\ 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 so that the proposed
rule change may become operative upon filing. In the filing, the
Exchange stated that the proposed changes are based on billing and
collection rules in place at several equity exchanges, which provide
for substantively similar alternative payment provisions in their
billing rules for equity members that may want to pay exchange fees via
an alternative method.\18\ The proposed changes do not raise any novel
issues and provide the Exchange with the flexibility to agree to an
alternative payment arrangement with a Member (or Equity Member), while
reserving the right to revert to the general rule (i.e., to require a
Clearing Member's account number with the Clearing Corporation, or by
providing a clearing account number for an account at NSCC, for direct
debit purposes) if the Exchange encounters repeated failed collection
attempts using such alternative payment instructions, and therefore,
waiver of the 30-day operative delay is consistent with the protection
of investors and the public interest. Accordingly, the Commission
hereby waives the operative delay and designates the proposal operative
upon filing.\19\
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\16\ 17 CFR 240.19b-4(f)(6).
\17\ 17 CFR 240.19b-4(f)(6)(iii).
\18\ See supra note 7.
\19\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 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 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
[[Page 17107]]
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="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#0b797e676e26686466666e657f784b786e68256c647d"><span class="__cf_email__" data-cfemail="1765627b723a74787a7a727963645764727439707861">[email protected]</span></a>. Please include
file number SR-PEARL-2025-13 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-2025-13. 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="https://www.sec.gov/rules/sro.shtml">https://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
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. Do not
include personal identifiable information in submissions; you should
submit only information that you wish to make available publicly. We
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection. All
submissions should refer to file number SR-PEARL-2025-13 and should be
submitted on or before May 14, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\20\
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\20\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-06913 Filed 4-22-25; 8:45 am]
BILLING CODE 8011-01-P
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