Notice2026-05234
Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Adopt Rules 11.23 and 11.24 Relating to Regulatory and Operational Trading Halts, Integrate Definitions and Concepts From the Amended CTA/CQ Plan, Reorganize Rule 11.16, and Make Conforming Changes to Related Rules
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
March 18, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
<html>
<head>
<title>Federal Register, Volume 91 Issue 52 (Wednesday, March 18, 2026)</title>
</head>
<body><pre>
[Federal Register Volume 91, Number 52 (Wednesday, March 18, 2026)]
[Notices]
[Pages 13083-13089]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-05234]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104988; File No. SR-CboeEDGX-2026-011]
Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Adopt Rules 11.23 and 11.24 Relating to Regulatory and Operational
Trading Halts, Integrate Definitions and Concepts From the Amended CTA/
CQ Plan, Reorganize Rule 11.16, and Make Conforming Changes to Related
Rules
March 13, 2026.
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 March 6, 2026, Cboe EDGX Exchange, Inc. (the ``Exchange'' or
````EDGX'''') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the Exchange. The
Exchange filed the proposal as a ``non-controversial'' 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.
---------------------------------------------------------------------------
\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).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Cboe EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX'') is filing
with the Securities and Exchange Commission (``Commission'') a proposal
to adopt Rules 11.23 and 11.24 to integrate several definitions and
concepts from the Amended CTA/CQ Plan and to reorganize Rule 11.16 in
light of the Exchange's experience with applying the rule during its
time as a national securities exchange and to make conforming changes
to related rules. The text of the proposed rule change is provided in
Exhibit 5.
The text of the proposed rule change is also available on the
Commission's website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>), the
Exchange's website (<a href="https://www.cboe.com/us/equities/regulation/rule_filings/bzx/">https://www.cboe.com/us/equities/regulation/rule_filings/bzx/</a>), and at the principal office of the Exchange.
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
In conjunction with adoption of Amended CTA/CQ Plan proposed by its
participants (``Amended CTA/CQ
[[Page 13084]]
Plan''),\5\ the Exchange proposes to adopt Rules 11.23 and 11.24 to
integrate several definitions and concepts from the Amended CTA/CQ Plan
and to reorganize existing Rule 11.16 in light of the Exchange's
experience with applying the rule during its time as a national
securities exchange.\6\ Current Rule 11.16 would be reorganized to
include only the Limit Up-Limit Down Mechanism.\7\ Proposed Rule 11.23
would be entitled ``Trading Halts'' and would set forth the Exchange's
authority to halt trading under various circumstances.\8\ Proposed Rule
11.24 would be entitled ``Trading Halts Due to Extraordinary Market
Volatility'' and would contain the rule text related to Market-Wide
Circuit Breakers currently codified in Rule 11.16(a)-(d), (g)-(j). As
part of these changes, the Exchange will create categories of
regulatory and operational halts, improve the rule's clarity, and adopt
defined terms from the Amended CTA/CQ Plan. In addition, the Exchange
is updating cross references in other rules that are affected by the
proposed changes.
---------------------------------------------------------------------------
\5\ On February 23, 2021, the participants of the CTA/CQ Plans
filed Amendment 36 to the CTA Plan and Amendment 27 to the CQ Plan,
to revise provisions governing regulatory and operational halts. See
Letter from Robert Books, Chairman, Operating Committee, CTA/CQ
Plans, to Vanessa Countryman, Secretary, Securities and Exchange
Commission, dated February 3, 2021. The SEC approved the amendments
on May 28, 2021. See Securities Exchange Act Release No. 34-92070
(May 28, 2021), 86 FR 29849 (June 3, 2021) (SR-CTA/CQ-2021-01). The
Amended CTA/CQ Plan includes provisions requiring participant self-
regulatory organizations (``SROs'') to honor a Regulatory Halt
declared by the Primary Listing Market. The provisions in the CTA/CQ
Plans, and the plan for consolidation of data for NASDAQ-listed
securities, The Joint Self-Regulatory Organization Plan Governing
The Collection, Consolidation and Dissemination of Quotation and
Transaction Information For NASDAQ-Listed Securities Traded on
Exchanges on an Unlisted Trading Privilege Basis (``UTP Plan''),
include provisions similar to the changes proposed by the Exchange
in this filing.
\6\ The Exchange notes that it is a participant of the
transaction reporting plan governing Tape B securities. Each
transaction reporting plan has a securities information processor
(``SIP'') responsible for consolidation of information for the
plan's securities, pursuant to Rule 603 of Regulation NMS. The
transaction reporting plans for BZX-listed securities are known as
the ``Consolidated Tape System and Consolidated Quotations System
Plan (collectively, the ``CTA/CQ Plans''). Pursuant to the CTA/CQ
Plans, the Securities Industry Automation Corporation (``SIAC'')
consolidates order and trade data from all markets trading BZX-
listed securities. The Exchange uses the term ``CTA/CQ SIP'' herein
when referring specifically to the SIP responsible for consolidation
of information in BZX-listed securities. BZX is an affiliate of the
Exchange and serves as a Primary Listing Market, unlike the
Exchange. Infra note 6.
\7\ See Securities Exchange Act Release No. 88704 (April 21,
2020), 85 FR 23383 (April 27, 2020) (File No. 4-631) (approving the
Twentieth Amendment to the National Market System Plan to Address
Extraordinary Market Volatility).
\8\ The Exchange notes that its sister exchange, Cboe BZX
Exchange, Inc. (``Cboe BZX''), filed a similar proposed rule change
with the Commission. The Exchange's proposal provides the Exchange
with less authority to declare halts in the event of regulatory or
operational issues than under Cboe BZX's proposal because the
Exchange, unlike Cboe BZX, is not a Primary Listing Market. Given
the Exchange's status as a non-Primary Listing Market, certain
definitions and concepts from the Amended CTA/CQ Plan, integrated in
Cboe BZX's proposal, are not included herein.
---------------------------------------------------------------------------
Background
The Exchange has been working with other SROs to establish common
criteria and procedures for halting and resuming trading in equity
securities in the event of regulatory or operational issues. These
common standards are designed to ensure that events which might impact
multiple exchanges are handled in a consistent manner that is
transparent. The Exchange believes that implementation of these common
standards will assist the SROs in maintaining fair and orderly markets.
Notwithstanding the development of these common standards, the Exchange
will retain discretion in certain instances as to whether and how to
handle halts, as is described below.
Every U.S.-listed equity security has its primary listing on a
specific stock exchange that is responsible for a number of regulatory
functions.\9\ These include confirming that the security continues to
meet the exchange's listing standards, monitoring trading in that
security and taking action to halt trading in the security when
necessary to protect investors and to ensure a fair and orderly market.
While these core responsibilities remain with the primary listing
venue, trading in the security can occur on multiple exchanges that
have unlisted trading privileges for the security or in the over-the-
counter market, regulated by the Financial Industry Regulatory
Authority, Inc. (``FINRA''). The exchanges and FINRA are responsible
for monitoring activity on the markets over which they have oversight,
but also must abide by the regulatory decisions made by the Primary
Listing Market. For example, a venue trading a security pursuant to
unlisted trading privileges must halt trading in that security during a
Regulatory Halt, which is a defined term under the proposed rules,\10\
and may only trade the security once the Primary Listing Market has
cleared the security to resume trading.
---------------------------------------------------------------------------
\9\ The Exchange is proposing to adopt Primary Listing Market as
a new term, defined in the CTA/CQ Plans, Section XI(a)(i)(H), as
follows: ``[T]he national securities exchange on which an Eligible
Security is listed. If an Eligible Security is listed on more than
one national securities exchange, Primary Listing Market means the
exchange on which the security has been listed the longest.''
\10\ See proposed Rule 11.23(a)(8).
---------------------------------------------------------------------------
While the Exchange and the other SROs intend to harmonize certain
aspects of their trading halt rules, other elements of the rules will
continue to be unique to each market. The Exchange believes that this
is appropriate to reflect different products listed or traded on each
market.
In addition to establishing common criteria and procedures for
halting and resuming trading in equity securities in the event of
regulatory or operational issues, the Exchange is reorganizing the rule
to improve clarity. The Exchange will implement all of the changes
proposed herein in conjunction with other SROs implementing the
necessary rule changes. The Exchange will publish a Trade Desk Notice
at least 30 business days prior to implementing the proposed changes.
Definitions
The Exchange proposes adding a definitions section as Rule 11.23(a)
to consolidate the various definitions that will be used in the Rule,
some of which are taken from the Amended CTA/CQ Plan. The Exchange is
adopting the following terms from the Amended CTA/CQ Plan: ``Operating
Committee,'' ``Operational Halt,'' ``Primary Listing Market,''
``Processor,'' \11\ ``Regulatory Halt,'' ``SIP Halt,'' and ``SIP Halt
Resume Time.'' The Exchange is adopting a modified form of the term
``Extraordinary Market Activity'' from the Amended CTA/CQ Plan, as
described below. The definitions of ``Post-Closing Session,'' ``Pre-
Opening Session,'' ``Regular Trading Hours,'' and ``UTP Derivative
Security'' are currently defined in Rule 1.5(r), (s), (y), and (gg)
respectively and have been cross-referenced in the definitions
section.\12\
---------------------------------------------------------------------------
\11\ The Exchange proposes to also define the term ``SIP'' to
have the same meaning as the term ``Processor'' as set forth in the
Amended CTA/CQ Plan. Because the terms ``Processor'' and ``SIP'' are
also used throughout the Rules, at time, to apply to processors of
information furnished pursuant to the Nasdaq UTP Plan (``UTP
Plan''), the term ``Processor'' may, in those applicable
circumstances, refer to the processor of transactions in Tape C
securities, as set forth in the UTP Plan.
\12\ As noted above, the Exchange is adopting several new terms
that have the same meaning as those terms are defined in the Amended
CTA/CQ Plan. Each of the national market system plans governing the
single plan processors have identical definitions of these terms,
thus there will be uniformity in the meaning of the terms among such
plans as well as among the rules of the SROs.
---------------------------------------------------------------------------
First, the Exchange proposes to add the definition of ``Primary
Listing Market'' \13\ to Rule 11.23(a), which will have the same
meaning as in the Amended CTA/CQ Plan, Section
[[Page 13085]]
XI(a)(i)(H). As is currently the case under Rule 14.1(c)(3), with
respect to UTP Derivative Securities, and under the CTA/CQ Plans, all
Regulatory Halt decisions are made by the market on which the security
has its primary listing. This reflects the regulatory responsibility
that the Primary Listing Market has for fair and orderly trading in the
securities that list on its market and its direct access to its listed
companies, which are required to advise it of certain events and
maintain lines of communication with the Primary Listing Market. The
proposed definition makes clear that if a security is listed on more
than one market (a dually-listed security), the Primary Listing Market
means the exchange on which the security has been listed the longest.
This provision matches the language used in the definition of ``Primary
Listing Exchange'' in the Limit Up-Limit Down Plan and will avoid
conflict in the event of dually-listed securities.
---------------------------------------------------------------------------
\13\ See proposed Rule 11.23(a)(6).
---------------------------------------------------------------------------
Second, the Exchange proposes to add the definition of
``Extraordinary Market Activity'' to Rule 11.23(a), which would
represent a modified version of the term defined in the Amended CTA/CQ
Plan, Section XI(a)(i)(A).\14\ Specifically, the Exchange proposes to
remove the concept of a ``market-wide basis'' from the Amended CTA/CQ
Plan's definition of Extraordinary Market Activity for purposes of the
Exchange's Rules because the term ``Extraordinary Market Activity''
would only be used in the Exchange's Rules as a basis for the Exchange
to initiate an Operational Halt, which would only occur on the market
declaring the halt (i.e., the Exchange).\15\ The current rule does not
include a definition for Extraordinary Market Activity.
---------------------------------------------------------------------------
\14\ In the Amended CTA/CQ Plan, ``Extraordinary Market
Activity'' means a disruption or malfunction of any electronic
quotation, communication, reporting, or execution system operated
by, or linked to, the Processor or a Trading Center or a member of
such Trading Center that has a severe and continuing negative
impact, on a market-wide basis, on quoting, order, or trading
activity or on the availability of market information necessary to
maintain a fair and orderly market. For purposes of this definition
in the Amended CTA/CQ Plan, a severe and continuing negative impact
on quoting, order, or trading activity includes (i) a series of
quotes, orders, or transactions at prices substantially unrelated to
the current market for the security or securities; (ii) duplicative
or erroneous quoting, order, trade reporting, or other related
message traffic between one or more Trading Centers or their
members; or (iii) the unavailability of quoting, order, or
transaction information for a sustained period.
\15\ The Exchange proposes to define ``Extraordinary Market
Activity'' to mean a disruption or malfunction of any electronic
quotation, communication, reporting, or execution system operated
by, or linked to, the Processor or a Trading Center or a member of
such Trading Center that has a severe and continuing negative impact
on quoting, order, or trading activity or on the availability of
market information necessary to maintain a fair and orderly market.
For purposes of this definition in the Exchange's rules, a severe
and continuing negative impact on quoting, order, or trading
activity includes (i) a series of quotes, orders, or transactions at
prices substantially unrelated to the current market for the
security or securities; (ii) duplicative or erroneous quoting,
order, trade reporting, or other related message traffic between one
or more Trading Centers of their members; or (iii) the
unavailability of quoting, order, transaction information, or
regulatory messages for a sustained period.
---------------------------------------------------------------------------
The next set of new proposed definitions would be specific to
events involving the SIP. While the Exchange recognizes that many
events involving the SIP would also meet the definition of
``Extraordinary Market Activity'' (as defined in the Amended CTA/CQ
Plan), the Exchange believes that the critical role of the SIPs in
market infrastructure factors in favor of additional guidance on how
such events will be handled. The definitions of ``SIP Halt Resume
Time,'' and ``SIP Halt'' are intended to provide additional guidance
and specific processes to address this subset of potential market
issues.\16\ In addition, the Exchange is proposing to define terms
related to SIP governance needed in order to understand these
definitions:
---------------------------------------------------------------------------
\16\ The Exchange proposes to define the terms ``SIP Halt Resume
Time'' and ``SIP Halt'' to have the same meaning as in the Amended
CTA/CQ Plan.
---------------------------------------------------------------------------
<bullet> ``Processor'' or ``SIP'' \17\ have the same meaning as the
term ``Processor'' set forth in the CTA/CQ Plans, namely the entity
selected by the Participants to perform the processing functions set
forth in the Plans. Because the terms ``Processor'' and ``SIP'' are
also used throughout the Rules, at times, to apply to processors of
information furnished pursuant to the Nasdaq UTP Plan, the term
``Processor'' and ``SIP'' may, in those applicable circumstances, refer
to the processor of transactions in Tape C securities, as set forth in
the Nasdaq UTP Plan.
---------------------------------------------------------------------------
\17\ See proposed Rule 11.23(a)(7).
---------------------------------------------------------------------------
<bullet> ``Operating Committee'' \18\ is defined as having the same
meaning as in the CTA/CQ Plans, namely the committee charged with
administering the CTA/CQ Plans.
---------------------------------------------------------------------------
\18\ See proposed Rule 11.23(a)(3).
---------------------------------------------------------------------------
The Exchange is proposing to adopt a category of Regulatory Halt,
called a ``SIP Halt,'' \19\ which will have the same meaning as that
term is defined in Section XI(a)(i)(K) of the CTA/CQ Plans, namely ``a
Regulatory Halt to trading in one or more securities that a Primary
Listing Market declares in the event of a SIP Outage or Material SIP
Latency.'' This new category of Regulatory Halt will address situations
where the Primary Listing Market declares a Regulatory Halt in one or
more securities as a result of a SIP Outage \20\ or Material SIP
Latency.\21\
---------------------------------------------------------------------------
\19\ See proposed Rule 11.23(a)(10).
\20\ SIP outage means a situation in which the Processor has
ceased, or anticipates being unable, to provide updated and/or
accurate quotation or last sale price information in one or more
securities for a material period that exceeds the time thresholds
for an orderly failover to backup facilities established by mutual
agreement among the Processor, the Primary Listing Market for the
affected securities, and the Operating Committee unless the Primary
Listing Market, in consultation with the Processor and the Operating
Committee, determines that resumption of accurate data is expected
in the near future. See Amended CTA/CTA Plan, Section XI(a)(i)(M).
\21\ Material SIP latency means a delay of quotation or last
sale price information in one or more securities between the time
data is received by the Processor and the time the Processor
disseminates the data over the Processor's vendor lines, which delay
the Primary Listing Market determines, in consultation with, and in
accordance with, publicly disclosed guidelines established by the
Operating Committee, to be (a) material and (b) unlikely to be
resolved in the near future. See Amended CTA/CTA Plan, Section
XI(a)(i)(E).
---------------------------------------------------------------------------
The Exchange proposes to add a definition of ``Regulatory Halt''
\22\ as having the same meaning as in Section XI(a)(i)(J) of the
Amended CTA/CQ Plan, which defines a Regulatory Halt to mean a halt
declared by the Primary Listing Market in trading in one or more
securities on all Trading Centers \23\ for regulatory purposes,
including for the dissemination of material news, news pending,
suspensions, or where otherwise necessary to maintain a fair and
orderly market. A Regulatory Halt includes a trading pause triggered by
Limit Up-Limit Down, a halt based on Extraordinary Market Activity (as
defined in the Amended CTA/CQ Plan), a trading halt triggered by a
Market-Wide Circuit Breaker, and a SIP Halt.
---------------------------------------------------------------------------
\22\ See proposed Rule 11.23(a)(8).
\23\ See Amended CTA/CQ Plan Section XI(a)(i)(N). A ``Trading
Center'' has the same meaning as that term is defined in Rule
600(b)(82) of Regulation NMS.
---------------------------------------------------------------------------
Finally, the Exchange proposes to add a definition of ``Operational
Halt,'' \24\ as having the same meaning as in Section XI(a)(i)(G) of
the Amended CTA/CQ Plan, which defines an Operational Halt to mean ``a
halt in trading in one or more securities only on a Market declared by
such Participant and is not a Regulatory Halt.'' \25\ An Operational
Halt is effective only on the Exchange; other markets are not required
to halt trading in the impacted securities. In practice, the Exchange
has always had the capacity to implement operational halts in specified
circumstances, but such halts are not currently referred to as
``operational halts'' in the Exchange's
[[Page 13086]]
rules.\26\ The proposed change would provide greater clarity on when an
Operational Halt may be implemented and the process for halting and
resuming trading in the event of an Operational Halt. An Operational
Halt is not a Regulatory Halt.
---------------------------------------------------------------------------
\24\ See proposed Rule 11.23(a)(4).
\25\ A ``Market'' has the same meaning as that term is defined
in Section XI(A)(i)(C) of the Amended CTA/CQ Plan.
\26\ See Rule 11.1(c).
---------------------------------------------------------------------------
Regulatory Halt Types
Proposed Rule 11.23(b) would set forth requirements relating to
Regulatory Halts.
Authority To Initiate a Regulatory Halt
The Exchange proposes to consolidate the various types of
situations that form the basis for declaring a Regulatory Halt in
proposed Rule 11.23(b)(1). In this subsection, the Exchange would
identify all of the bases for its Regulatory Halt authority, including
cross-referencing to current rules describing existing halt authority
and by adding the new Regulatory Halt authority consistent with the
Amended CTA/CQ Plan.
Proposed Rule 11.23(b)(1)(A) describes ``Mandatory Halts,'' where
the Exchange must issue a Regulatory Halt. The proposed rule would
identify four categories of Regulatory Halts:
<bullet> Pursuant to proposed Rule 11.23(b)(1)(A)(i) regarding the
Market-Wide Circuit Breakers, which will be retained without
modification in proposed Rule 11.24 (currently codified in Rule
11.16(a)-(d); (f)-(j)). This proposed rule would effectuate the
definition of Regulatory Halt in proposed Rule 11.23(a)(8), which
cross-references Section XI(a)(i)(J) of the Amended CTA/CQ Plan.
<bullet> Pursuant to proposed Rule 11.23(b)(1)(A)(ii) regarding the
Limit Up-Limit Down Mechanism (proposed Rule 11.16). This proposed rule
would effectuate the definition of Regulatory Halt in proposed Rule
11.23(a)(8), which cross-references Section XI(a)(i)(J) of the Amended
CTA/CQ Plan. The Exchange, as a non-Primary Listing Market, does not
itself declare trading pauses pursuant to the Limit Up-Limit Down
Mechanism, but rather implements such pauses declared by Primary
Listing Markets.
<bullet> Pursuant to proposed Rule 11.23(b)(1)(A)(iii), which would
provide that the Exchange must halt trading when the Primary Listing
Market declares a SIP Halt or halts trading based on Extraordinary
Market Activity. This proposed rule would effectuate the definition of
Regulatory Halt in proposed Rule 11.23(a)(8), which cross-references
Section XI(a)(i)(J) of the Amended CTA/CQ Plan.
<bullet> Pursuant to proposed Rule 11.23(b)(1)(A)(iv), which would
provide that the Exchange would honor a Regulatory Halt initiated by
the Primary Listing Market for any security listed on the Exchange.
This proposed rule would effectuate the definition of Regulatory Halt
in proposed Rule 11.23(a)(8), which cross-references Section
XI(a)(i)(J) of the Amended CTA/CQ Plan.
The Exchange proposes to add proposed Rule 11.23(b)(1)(A)(iv)(a),
which makes clear that the start time of a Regulatory Halt is the time
the Primary Listing Market declares the Regulatory Halt, regardless of
whether communication issues impact the dissemination of notice of the
Halt.\27\ This proposal would provide market participants with
certainty on the official start time of the Regulatory Halt. Under the
proposed rule, the start time is fixed by the Primary Listing Market;
it is not dependent on whether notice is disseminated immediately. This
will avoid possible disagreement if the Regulatory Halt time were tied
to dissemination or receipt of notification, which may occur at
different times. The Exchange recognizes that in situations where
communication is interrupted, trades may continue to occur until news
of the Regulatory Halt reaches all Trading Centers. However, a fixed
``official'' Regulatory Halt time will allow SROs to revisit trades
after the fact and determine in a consistent manner whether specific
trades should stand.
---------------------------------------------------------------------------
\27\ This is consistent with the Amended CTA/CQ Plan. See
Amended CTA/CQ Plan, Section XI(a)(iv)(A).
---------------------------------------------------------------------------
Resumption of Trading After a Regulatory Halt
The SROs have jointly developed processes to govern the resumption
of trading in the event of a Regulatory Halt. While the actual process
of re-launching trading will remain unique to each exchange, the
proposed rule would harmonize certain common elements of the reopening
process that would benefit from consistency across markets. These
common elements include the primacy of the Primary Listing Market in
resumption decisions, the requirement that the Primary Listing Market
make its determination to resume trading in good faith,\28\ and certain
parts of the complex process of reopening trading after a SIP Halt.
With respect to a SIP Halt, common elements of the reopening process
include the interaction among SROs (including the Primary Listing
Market with the SIP), the requirement that the Primary Listing Market
terminate a SIP Halt with a notification that specifies a SIP Halt
Resume Time, the minimum quoting times before resumption of trading,
the cutoff time after which trading would not resume during Regular
Trading Hours, and the time when trading may resume if the Primary
Listing Market does not open a security within the amount of time
specified in its rules after the SIP Halt Resume Time.
---------------------------------------------------------------------------
\28\ See Partial Amendment No. 1 to the CTA/CQ Plans, dated
March 31, 2021.
---------------------------------------------------------------------------
Proposed Rule 11.23(b)(2), which incorporates Section XI(a)(v)(A)
and Section XI(a)(vi)(C) of the Amended CTA/CQ Plan, is divided into
the following two subsections concerning resumption of trading: (A)
after a Regulatory Halt other than a SIP Halt; and (B) after a SIP
Halt. Proposed Rule 11.23(b)(2)(A)(i) provides that, for a Regulatory
Halt other than a SIP Halt, the Exchange may resume trading after the
Exchange receives notification from the Primary Listing Market that the
Regulatory Halt has been terminated.
Proposed Rule 11.23(b)(2)(A) provides the process to be followed
when resuming trading upon the conclusion of Regulatory Halts other
than SIP Halts. The new rule would effectuate Section XI(a)(v) of the
Amended CTA/CQ Plan.
Proposed Rule 11.23(b)(2)(B) would address the resumption of
trading following a SIP Halt. The new rule would effectuate Section
XI(a)(vi) of the Amended CTA/CQ Plan. Proposed Rule 11.23(b)(2)(B)(i)
would provide that, for securities subject to a SIP Halt initiated by
another exchange that is the Primary Listing Market, during Regular
Trading Hours, the Exchange may resume trading after trading has
resumed on the Primary Listing Market or notice has been received from
the Primary Listing Market that trading may resume. During Regular
Trading Hours, if the Primary Listing Market does not open a security
within the amount of time specified by the rules of the Primary Listing
Market after the SIP Halt Resume Time, the Exchange may resume trading
in that security. Outside Regular Trading Hours, the Exchange may
resume trading immediately after the SIP Halt Resume Time.\29\
---------------------------------------------------------------------------
\29\ See Partial Amendment No. 2 of Trading Halt Amendments to
the CTA/CQ Plan, dated April 7, 2021.
---------------------------------------------------------------------------
Proposed Rule 11.23(b)(2)(C) would state that trading will resume
and orders will be accepted pursuant to the re-opening process found in
current Rule 11.7(e). The Exchange proposes to amend Rule 11.7(e) to
make clear that the rule only applies to the resumption of trading
following a Regulatory Halt and to amend the cross-reference to the
[[Page 13087]]
rule associated with halts due to a Market-Wide Circuit Breaker. Rule
11.7(e) describes the re-opening process for all securities subject to
a Regulatory Halt and is consistent with current practice.
Operational Halt
The Exchange proposes in Rule 11.23(c) to address Operational
Halts, which are non-regulatory in nature and apply only to the
Exchange that calls the halt. As described above, the Exchange has
always had the capacity to implement operational halts and local
trading suspensions in specified circumstances, but such halts are not
currently referred to as ``operational halts'' in the Exchange's
rules.\30\ As part of the Exchange's assessment with the other SROs of
the halting and resumption of trading, the Exchange believes that the
markets would benefit from greater clarity regarding when an
Operational Halt may be appropriate.\31\ In part, the proposed change
is designed to cover situations similar to those that might constitute
a Regulatory Halt, but where the impact is limited to a single market.
For example, just as a market disruption might trigger a Regulatory
Halt for Extraordinary Market Activity (as defined in the Amended CTA/
CQ Plan) if it affects multiple markets, so a disruption at the
Exchange, such as a technical issue affecting trading in one or more
securities, could impact trading on the Exchange so significantly that
an Operational Halt is appropriate in one or more securities. In such
an instance, it would be in the public interest to institute an
Operational Halt to minimize the impact of a disruption that, if
trading were allowed to continue, might negatively affect a greater
number of market participants. An Operational Halt does not implicate
other trading centers.
---------------------------------------------------------------------------
\30\ See Rule 11.1(c). The Exchange also notes that its proposed
Rule 11.28(c) regarding Operational Halts is substantially identical
to similar rule changes filed by competitor exchanges. See, e.g.,
Securities Exchange Act Release No. 96574 (December 22, 2022), 87 FR
80213 (December 29, 2022), SR-PHLX-2022-49; Securities Exchange Act
Release No. 97093 (March 9, 2023), 88 FR 16045 (March 15, 2023), SR-
PEARL-2023-11; and Securities Exchange Act Release No. 97824 (June
29, 2023), 88 FR 43159 (July 6, 2023), SR-MEMX-2023-11.
\31\ Differences between Cboe BZX and the Exchange's proposals
as it relates to Operational Halts stem from Cboe BZX's status as a
Primary Listing Market, unlike the Exchange.
---------------------------------------------------------------------------
Proposed Rule 11.23(c)(1) would specify the Exchange's authority to
initiate an Operational Halt, which is discretionary, and provide that
the Exchange may declare an Operational Halt for any security trading
on the Exchange if it is experiencing Extraordinary Market Activity on
the Exchange (proposed Rule 11.23(c)(1)(A)) or when otherwise necessary
to maintain a fair and orderly market or in the public interest
(proposed Rule 11.23(c)(1)(B)).
Under proposed Rule 11.23(c)(2) the Exchange would notify the
Processor if it has concerns about its ability to collect and transmit
quotes, orders, or last sale prices, or if it has declared an
Operational Halt or suspension of trading in one or more Eligible
Securities (as that term is defined in the Amended CTA/CQ Plan),
pursuant to the procedures adopted by the Operating Committee.
Proposed Rule 11.23(c)(3) will clarify how the Exchange resumes
trading after an Operational Halt. Proposed Rule 11.23(c)(3)(A)
provides that the Exchange would resume trading when it determines that
trading may resume in a fair and orderly manner consistent with the
Exchange's rules. Proposed Rule 11.23(c)(3)(B) specifies that the
Exchange would resume trading following an Operational Halt pursuant to
Rule 11.7(f). The Exchange proposes adding subsection (f) to Rule 11.7
to describe the Exchange's re-opening process for a security subject to
an Operational Halt, which differs from the process of re-opening a
security following a Regulatory Halt. Proposed Rule 11.7(f) describes
the Exchange's current practice for re-opening securities that are not
subject to a Regulatory Halt and states that while a security is
subject to an Operational Halt, orders will not be accepted for queuing
prior to the security's resumption of trading and that any open orders
on the EDGA Book \32\ will be cancelled.\33\ Proposed Rule 11.7(f)(1)
states that a security subject to an Operational Halt will return to
trading when the Exchange declares that trading may resume pursuant to
Rule 11.23(c)(3).
---------------------------------------------------------------------------
\32\ See Rule 1.5(e).
\33\ The Exchange notes that its re-opening process for
securities subject to an Operational Halt is simply to open the
security for trading. There is no queuing process or re-opening
auction associated with the re-opening of a security subject to an
Operational Halt.
---------------------------------------------------------------------------
Proposed Rule 11.23(c)(4) provides that trading in a halted
security shall resume at the time specified by the Exchange in a
notice. It would further specify that the Exchange would notify all
other Plan participants and the SIP of such Operational Halt as well as
provide notice that an Operational Halt has been lifted using such
protocols and other emergency procedures as may be mutually agreed to
between the Operating Committee and the Exchange. If the SIP is unable
to disseminate notice of an Operational Halt or the Exchange is not
open for trading, the Exchange would take reasonable steps to provide
notice of an Operational Halt, which shall include both the type and
start time of the Operational Halt. Each Plan participant shall
continuously monitor communication protocols established by the
Operating Committee and the Processor during market hours to
disseminate notice of an Operational Halt, and the failure of a
participant to do so shall not prevent the Exchange from initiating an
Operational Halt.
Conforming Changes to Other Rules
The Exchange is proposing to modify Rules 11.7 (Opening Process),
Rule 11.8 (Order Types), Rule 11.10 (Order Execution), Rule 11.11
(Routing to Away Trading Centers), Rule 11.20 (Obligations of Market
Makers), and Rule 14.1 (Unlisted Trading Privileges) that cross
reference Rule 11.16 in light of the reorganization of current Rule
11.16 into Rules 11.23 and 11.24. Rule 11.8(a)(2), Rule 11.10(a)(3),
Rule 11.11(b), Rule 11.20(d)(2)(D) and Rule 11.20(d)(2)(E) will be
modified to update a cross reference to the Rule that governs Limit Up-
Limit Down procedures. Additionally, the introductory text to Rule
11.11 will be amended to include the word ``Rule'' that was
inadvertently omitted. Rule 11.7(e) will be modified to update a cross
reference to the Rule that governs halts under a Market-Wide Circuit
Breaker. In addition, Rule 11.7(e) will be modified to include the word
``Regulatory'' in order to indicate its applicability only to
Regulatory Halts. Rule 14.1(c)(3) will be modified to update a cross
reference to current Rule 11.16. Rule 14.1 Interpretation and Policies
.01 will be modified to correct an incorrect rule reference to Rule
14.1(c)(4)(A) and (B) to properly reflect Rule 14.1(c)(3)(A) and (B).
The Exchange notes that the changes described above are not substantive
and serve only to update cross references to rules that have been
relocated.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\34\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section
[[Page 13088]]
6(b)(5) \35\ 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) \36\ requirement that the rules of an exchange not be designed
to permit unfair discrimination between customers, issuers, brokers, or
dealers.
---------------------------------------------------------------------------
\34\ 15 U.S.C. 78f(b).
\35\ 15 U.S.C. 78f(b)(5).
\36\ Id.
---------------------------------------------------------------------------
As described above, the Exchange and other SROs are seeking to
adopt harmonized rules related to halting and resuming trading in U.S.-
listed equity securities. The Exchange believes that the proposed rules
will provide greater transparency and clarity with respect to the
situations in which trading will be halted and the process through
which that halt will be implemented and terminated. Particularly, the
proposed changes seek to achieve consistent results for participants
across U.S. equities exchanges while maintaining a fair and orderly
market, protecting investors and protecting the public interest. Based
on the foregoing, the Exchange believes that the proposed rules are
consistent with Section 6(b)(5) of the Act \37\ because they will
foster competition and coordination with persons engaged in regulating
and facilitating transactions in securities.
---------------------------------------------------------------------------
\37\ Id.
---------------------------------------------------------------------------
As discussed previously, the Exchange believes that the various
provisions of the proposed rules that will apply to all SROs are
focused on the type of cross-market event where a consistent approach
will assist market participants and reduce confusion during a crisis.
Because market participants often trade the same security across
multiple venues and trade securities listed on different exchanges as
part of a common strategy, the Exchange believes that the proposed
rules will lessen the risk that market participants holding a basket of
securities will have to deal with divergent outcomes depending on where
the securities are listed or traded. Conversely, the proposed rules
would still allow individual SROs to react differently to events that
impact various securities or markets in different ways. This avoids the
``brittle market'' risk where an isolated event at a single market
forces all markets trading equity securities to halt or halts trading
in all securities where the issue impacted only a subset of securities.
By addressing both concerns, the Exchange believes that the proposed
rules further the Act's goal of maintaining fair and orderly markets.
The Exchange believes that the proposed rules' focus of
responsibility on the Primary Listing Market for decisions related to a
Regulatory Halt and the resumption of trading is consistent with the
Act, which itself imposes obligations on exchanges with respect to
issuers that are listed. As is currently the case, the Primary Listing
Market would be responsible for the many regulatory functions related
to its listings, including the determination of when to declare a
Regulatory Halt. While these core responsibilities remain with the
Primary Listing Market, trading in the security can occur on multiple
exchanges that have unlisted trading privileges for the security, such
as on the Exchange, or in the over-the-counter market, regulated by
FINRA. The Exchange is responsible for monitoring activity on its own
markets, but also must honor a Regulatory Halt.
The proposed changes relating to Regulatory Halts would ensure that
all SROs handle the situations covered therein in a consistent manner
that would prevent conflicting outcomes in cross-market events and
ensure that all trading centers recognize a Regulatory Halt declared by
the Primary Listing Market. The changes are consistent with and
implement the Amended CTA/CQ Plan.
The Exchange believes that the other definitions in the proposed
rules are also consistent with the Act. For example, the proposed rules
would define what constitutes Extraordinary Market Activity, consistent
with the amended definition of that term in the Amended CTA/CQ Plan,
thereby furthering the Act's goal of promoting fair and orderly
markets. The Exchange is also proposing to adopt definitions for ``SIP
Outage,'' ``Material SIP Latency'' and ``SIP Halt,'' to explicitly
address situations that may disrupt the markets, and these definitions
are identical to the definitions in the Amended CTA/CQ Plan. The
proposed rules provide guidance on when the Exchange should seek
information from the Operating Committee, other SROs and market
participants as well as means for dissemination of important
information to the market, consistent with the Amended CTA/CQ Plan. The
Exchange believes these provisions strike the right balance in
outlining a process to address unforeseen events without preventing
SROs from taking action needed to protect the market.
The Exchange believes that the proposed rules, which make halts
more consistent across exchange rules, are consistent with the Act in
that they will foster cooperation and coordination with persons engaged
in regulating the equities markets. In particular, the Exchange
believes it is important for SROs to coordinate when there is a
widespread and significant event, as multiple trading centers are
impacted in such an event. Further, while the Exchange recognizes that
the proposed rule will not guarantee a consistent result on every
market in all situations, the Exchange does believe that it will assist
in that outcome. While the proposed rules relating to Regulatory Halts
focus primarily on the kinds of cross-market events that would likely
impact multiple markets, individual SROs will still retain flexibility
to deal with unique products or smaller situations confined to a
particular market.
Also consistent with the Act, and with the Amended CTA/CQ Plan, is
the Exchange's proposal in Rule 11.23(c) to address Operational Halts,
which are non-regulatory in nature and apply only to the exchange that
calls the halt. As noted earlier, the Exchange presently has the
ability to implement operational halts and local trading suspensions,
but such halts are not currently referred to as ``operational halts''
in the Exchange's rules.\38\ The Exchange also notes that its proposed
Rule 11.23(c) regarding Operational Halts is substantially identical to
the proposals filed by competitor exchanges,\39\ and is therefore not
novel.
---------------------------------------------------------------------------
\38\ See Rule 11.1(c).
\39\ Supra note 30.
---------------------------------------------------------------------------
The Exchange believes that its proposal to introduce Rule 11.7(f)
is consistent with the Act because it will describe the Exchange's
ability to accept and process orders during an Operational Halt and
describe the re-opening process for securities subject to an
Operational Halt, which will provide clarity to market participants
about how their orders will behave during an Operational Halt and
describe how a security subject to an Operation Halt will resume
trading.
Additionally, the proposed conforming changes to Rules 11.7, 11.8,
11.10, 11.11, 11.20, and 14.1 are consistent with the Act in that they
seek to provide the correct reference to the Limit Up-Limit Down
procedures and halts, suspensions, or trading pauses
[[Page 13089]]
due to Market-Wide Circuit Breakers without modification from current
Rule 11.16. The Exchange believes that it is consistent with the Act to
reorganize the text related to Market-Wide Circuit Breakers currently
codified in Rule 11.16(a)-(d), (g)-(j) into Rule 11.24 as it would
provide clarity to market participants and better align with how the
rules of other market centers are currently organized.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange believes the proposal is consistent with Section
6(b)(8) of the Act \40\ in that it does not impose any burden on
competition that is not necessary or appropriate in furtherance of the
purposes of the Act as explained below.
---------------------------------------------------------------------------
\40\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------
Importantly, the Exchange believes the proposal will not impose a
burden on intermarket competition but will rather alleviate any burden
on competition because it is the result of a collaborative effort by
all SROs to harmonize and improve the process related to the halting
and resumption of trading in U.S.-listed equity securities, consistent
with the Amended CTA/CQ Plan. In this area, the Exchange believes that
all SROs should have consistent rules to the extent possible in order
to provide additional transparency and certainty to market participants
and to avoid inconsistent outcomes that could cause confusion and erode
market confidence. The proposed changes would ensure that all SROs
handle the situations covered therein in a consistent manner and ensure
that all trading centers handle a Regulatory Halt consistently. The
Exchange understands that all other non-Primary Listing Markets intend
to file proposals that are substantially similar to this proposal.
The Exchange does not believe that its proposals concerning
Operational Halts impose an undue burden on competition. Under the
existing Rules, the Exchange already possesses discretionary authority
to impose Operational Halts for various reasons, including because of
an order imbalance or influx that causes another national securities
exchange to impose a trading halt in a security.\41\ As described
earlier, the proposed Rule change clarifies and broadens the
circumstances in which the Exchange may impose such Halts, and
specifies procedures for both imposing and lifting them. The Exchange
does not intend for these proposals to have any competitive impact
whatsoever. Indeed, the Exchange expects that other exchanges will
adopt similar rules and procedures to govern operational halts, to the
extent that they have not done so already.\42\
---------------------------------------------------------------------------
\41\ See Rule 11.1(c).
\42\ See, e.g., Securities Exchange Act Release No. 96574
(December 22, 2022), 87 FR 80213 (December 29, 2022), SR-PHLX-2022-
49; Securities Exchange Act Release No. 97093 (March 9, 2023), 88 FR
16045 (March 15, 2023), SR-PEARL-2023-11; and Securities Exchange
Act Release No. 97824 (June 29, 2023), 88 FR 43159 (July 6, 2023),
SR-MEMX-2023-11.
---------------------------------------------------------------------------
The Exchange does not believe that the proposed rule change imposes
a burden on intramarket competition because the provisions apply to all
market participants equally. In addition, information regarding the
halting and resumption of trading will be disseminated using several
freely accessible sources to ensure broad availability of information
in addition to the SIP data and proprietary data feeds offered by the
Exchange and other SROs that are available to subscribers. In addition,
the declaration and timing of trading halts and the resumption of
trading is designed to avoid any advantage to those who can react more
quickly than other participants. The proposals encourage early and
frequent communication among the SROs, SIPs and market participants to
enable the dissemination of timely and accurate information concerning
the market to market participants.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange 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 \43\ and
Rule 19b-4(f)(6) \44\ 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.
---------------------------------------------------------------------------
\43\ 15 U.S.C. 78s(b)(3)(A).
\44\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
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="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#4a383f262f67292527272f243e390a392f29642d253c"><span class="__cf_email__" data-cfemail="3b494e575e16585456565e554f487b485e58155c544d">[email protected]</span></a>. Please include
file number SR-CboeEDGX-2026-011 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-CboeEDGX-2026-011. 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 filing 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-CboeEDGX-2026-011 and should be
submitted on or before April 8, 2026.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\45\
---------------------------------------------------------------------------
\45\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-05234 Filed 3-17-26; 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 March 18, 2026.
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.