Notice2026-05334
Self-Regulatory Organizations; MIAX Sapphire, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Temporarily Decrease the Options Regulatory Fee (ORF)
Primary source
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Published
March 19, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 53 (Thursday, March 19, 2026)</title>
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[Federal Register Volume 91, Number 53 (Thursday, March 19, 2026)]
[Notices]
[Pages 13359-13363]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-05334]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-105001; File No. SR-SAPPHIRE-2026-10]
Self-Regulatory Organizations; MIAX Sapphire, LLC; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To
Temporarily Decrease the Options Regulatory Fee (ORF)
March 16, 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, MIAX Sapphire, LLC (``MIAX Sapphire'' or
``Exchange'') filed with the Securities and Exchange Commission (the
``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 is filing a proposal to amend the MIAX Sapphire
Options Exchange Fee Schedule (the ``Fee
[[Page 13360]]
Schedule'') relating to the Options Regulatory Fee (``ORF'').
The text of the proposed rule change is available on the Exchange's
website at <a href="https://www.miaxglobal.com/markets/us-options/all-options-exchanges/rule-filings">https://www.miaxglobal.com/markets/us-options/all-options-exchanges/rule-filings</a>, and at MIAX Sapphire's principal office.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the Fee Schedule to temporarily
decrease the ORF from $0.0013 per contract to $0.0011 per contract
between March 1, 2026 and June 30, 2026.\3\ In the event that the
industry does not move to the new ORF model effective July 1, 2026, the
Exchange would file a proposal to extend the ORF sunset date beyond
June 30, 2026, and revert back to $0.0013 per contract side.
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\3\ On January 21, 2026, the Exchange filed a separate rule
filing to adopt a new ORF model, effective July 1, 2026 (subject to
adoption of a similar model by all options exchanges). See
Securities Exchange Act Release No. 104713 (January 28, 2026), 91 FR
4750 (February 2, 2026) (SR-SAPPHIRE-2026-01) (Self-Regulatory
Organizations; MIAX Sapphire, LLC; Notice of Filing and Immediate
Effectiveness of a Proposed Rule Change To Adopt a New Methodology
for Assessment and Collection of the Options Regulatory Fee (ORF)).
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Background
The ORF is designed to recover a material portion of the costs to
the Exchange of the supervision and regulation of Members' \4\ customer
options business, including performing routine surveillances and
investigations, as well as policy, rulemaking, interpretive and
enforcement activities. The Exchange believes that revenue generated
from the ORF, when combined with all of the Exchange's other regulatory
fees and fines, will cover a material portion, but not all, of the
Exchange's regulatory costs.
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\4\ The term ``Member'' means an individual or organization that
is registered with the Exchange pursuant to Chapter II of MIAX
Sapphire 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.
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Collection of ORF
Currently, the Exchange assesses the per-contract ORF to each
Member for all options transactions cleared or ultimately cleared by
the Member, which are cleared by the Options Clearing Corporation
(``OCC'') in the ``customer'' range,\5\ regardless of the exchange on
which the transaction occurs. The ORF is collected by OCC on behalf of
the Exchange from either: (1) a Member that was the ultimate clearing
firm for the transaction; or (2) a non-Member that was the ultimate
clearing firm where a Member was the executing clearing firm for the
transaction. The Exchange uses reports from OCC to determine the
identity of the executing clearing firm and ultimate clearing firm.
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\5\ Exchange participants must record the appropriate account
origin code on all orders at the time of entry in order. The
Exchange represents that it has surveillances in place to verify
that Members mark orders with the correct account origin code.
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ORF Revenue and Monitoring of ORF
The Exchange monitors the amount of revenue collected from the ORF
to ensure that it, in combination with other regulatory fees and fines,
does not exceed regulatory costs. In determining whether an expense is
considered a regulatory cost, the Exchange reviews all costs and makes
determinations if there is a nexus between the expense and a regulatory
function. The Exchange notes that fines collected by the Exchange in
connection with a disciplinary matter offset ORF.
Revenue generated from ORF, when combined with all of the
Exchange's other regulatory fees and fines, is designed to cover a
material portion of the regulatory costs to the Exchange of the
supervision and regulation of Members' customer options business
including performing routine surveillances, investigations,
examinations, financial monitoring, and policy, rulemaking,
interpretive, and enforcement activities. Regulatory costs include
direct regulatory expenses and certain indirect expenses in support of
the regulatory function. The direct expenses include in-house and third
party service provider costs to support the day-to-day regulatory work
such as surveillances, investigations and examinations.
The ORF revenue is based on options transactions volume, thus the
amount of ORF collected is variable. For example, if options
transactions reported to OCC in a given month increase, the ORF
collected from Members will likely increase as well. Similarly, if
options transactions reported to OCC in a given month decrease, the ORF
collected from Members will likely decrease as well. Accordingly, the
Exchange monitors the amount of ORF collected to ensure that it does
not exceed a material portion of regulatory costs. If the Exchange
determines the amount of ORF collected exceeds or may exceed a material
portion of regulatory costs, the Exchange will, as appropriate, adjust
the ORF by submitting a fee change filing to the Securities and
Exchange Commission (the ``Commission'').
Proposal
Based on the Exchange's recent review of regulatory costs, ORF
revenue, and options transaction volume, the Exchange proposes to
temporarily decrease the ORF from $0.0013 per contract to $0.0011 per
contract, between March 1, 2026 and June 30, 2026. In the event that
the industry does not move to the new ORF model effective July 1, 2026,
the Exchange would file a proposal to extend the ORF sunset date beyond
June 30, 2026, and revert back to $0.0013 per contract side. This
proposed temporary decrease will help ensure that the amount collected
from the ORF, in combination with other regulatory fees and fines, does
not exceed the Exchange's total regulatory costs. On January 30, 2026,
the Exchange notified Members of the proposed temporary decrease to the
ORF via a Regulatory Circular to afford market participants sufficient
opportunity to configure their systems to account properly for the
modified ORF.\6\
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\6\ See <a href="https://www.miaxglobal.com/sites/default/files/circular-files/MIAX_Sapphire_Options_RC_2026_10.pdf">https://www.miaxglobal.com/sites/default/files/circular-files/MIAX_Sapphire_Options_RC_2026_10.pdf</a>.
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The proposed change to the ORF is based on the Exchange's analysis
of recent options volumes and its regulatory costs. The Exchange
believes that, if the ORF is not temporarily reduced between March 1,
2026 and June 30, 2026, the ORF revenue to the Exchange could exceed a
material portion of the Exchange's 2026 regulatory costs.
Over the past few years, the options industry has experienced high
options trading volumes and volatility and the persisting increased
options volumes have impacted the Exchange's ORF collection.
As shown in the table below, during the first half of 2025, options
trading
[[Page 13361]]
volumes have remained elevated and volatility has persisted.\7\
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\7\ The OCC publishes options and futures volume in a variety of
formats, including daily and monthly volume by exchange, available
here: <a href="https://www.theocc.com/Market-Data/Market-Data-Reports/Volume-and-Open-Interest/Monthly-Weekly-Volume-Statistics">https://www.theocc.com/Market-Data/Market-Data-Reports/Volume-and-Open-Interest/Monthly-Weekly-Volume-Statistics</a>. The volume
discussed in this filing is based on a compilation of OCC data for
monthly volume of equity-based options and monthly volume of ETF-
based options, in contract sides.
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Jan. 2025 Feb. 2025 Mar. 2025 Apr. 2025 May 2025 June 2025
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Customer ADV............................................ 46,758,284 48,508,333 46,281,134 47,786,196 46,234,519 45,453,082
Total ADV............................................... 53,134,932 54,563,396 53,182,376 55,339,630 51,351,579 50,576,203
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In addition, as shown in the table below, during the second half of
2025, options trading volumes have remained elevated and volatility has
persisted.\8\
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\8\ See id.
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July 2025 August 2025 September 2025 October 2025 November 2025 December 2025
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Customer ADV............................................ 47,244,127 50,273,952 56,005,046 61,209,858 55,296,579 47,490,683
Total ADV............................................... 51,516,242 54,909,360 61,298,900 67,192,745 62,132,472 53,703,207
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Because of the sustained impact of the trading volumes that have
persisted through December 2025, along with the difficulty of
predicting whether and when volumes may return to historical levels,
the Exchange proposes to temporarily decrease the ORF between March 1,
2026 and June 30, 2026, to help ensure that ORF collection will not
exceed the Exchange's 2026 regulatory costs. The Exchange cannot
predict whether options volumes will remain at these levels going
forward and projections for future regulatory costs are estimated.
Particularly, based on the Exchange's estimated projections for its
regulatory costs, the revenue generated by ORF using the temporarily
reduced rate, would result in projected revenue that is insufficient to
cover a material portion of its regulatory costs. Further, when
combined with the Exchange's projected other non-ORF regulatory fees
and fines, the revenue generated by ORF using the temporarily reduced
rate is projected to result in a combined revenue that is less than the
Exchange's estimated regulatory costs for the year. The Exchange will
notify Members of the proposed change via a Regulatory Circular at
least 30 calendar days prior to the effective date of the change.
Potential ORF Reform
The Exchange appreciates the evolving changes in the markets and
regulatory environment and has been evaluating its options while
considering industry and regulatory feedback. In light of this, the
Exchange has been reviewing its current methodologies and practices for
the assessment and collection of ORF. As a result of this review, the
Exchange submitted a filing to the Commission that proposes to adopt a
modified ORF model, effective July 1, 2026, that updates the Exchange's
process of assessing and collecting ORF, in which model ORF would be
assessed to only on-Exchange transactions that clear in the customer
range at the OCC.\9\ Under the proposed modified model, the Exchange
expects to continue its current practice that revenue generated from
ORF will cover a material portion, but not all, of the Exchange's
regulatory costs.
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\9\ See supra note 3.
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To create real ORF reform, moving to a new ORF model that only
assesses a fee to transactions that occur on one's own options exchange
seems to be the industry consensus. However, for a new, modified model
to be truly meaningful and fair, a rate limited to transactions on
one's own exchange should be adopted by all options exchanges to
provide a consistent methodology in assessing and collecting ORF going
forward. As set forth in its separate filing that proposes the new,
modified ORF model, the Exchange committed to switching to this new
model effective July 1, 2026, provided that a consistent framework has
been established with the Commission, adopted by all the options
exchanges and necessary regulatory filings submitted. Until that time,
the Exchange believes it's fair and reasonable to continue to charge
ORF under the current model as other options exchanges currently do.
2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \10\ in general, and
furthers the objectives of Section 6(b)(4) of the Act \11\ in
particular, in that it is an equitable allocation of reasonable dues,
fees, and other charges among its members and issuers and other persons
using its facilities. The Exchange also believes the proposal furthers
the objectives of Section 6(b)(5) of the Act \12\ in that it is
designed to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and
a national market system, and, in general to protect investors and the
public interest and is not designed to permit unfair discrimination
between customers, issuers, brokers and dealers.
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\10\ 15 U.S.C. 78f(b).
\11\ 15 U.S.C. 78f(b)(4).
\12\ 15 U.S.C. 78f(b)(5).
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The Proposal Is Reasonable
The Exchange believes the proposed fee changes are reasonable
because customer transactions will be subject to a lower ORF fee than
the current rate. Moreover, the proposed temporary reduction to $0.0011
per contract is reasonable because it would help ensure that
collections from the ORF do not exceed a material portion of the
Exchange's projected regulatory costs for 2026. As noted above, the ORF
is designed to recover a material portion, but not all, of the
Exchange's regulatory costs.
Although there can be no assurance that the Exchange's final costs
for 2026 will not differ materially from its expectations and prior
practice, nor can the Exchange predict with certainty whether options
volume will remain at current or similar levels going forward, the
Exchange believes that the amount collected based on the current ORF
rate, when combined with regulatory fees and fines, may result in
collections in excess of the projected regulatory costs
[[Page 13362]]
for the year. Particularly, as noted above, the options market has
continued to experience elevated volumes and volatility in 2025, and if
such elevated levels persist in 2026 could result in higher ORF
collections than projected. The Exchange therefore believes that the
proposed temporary decrease to the ORF is reasonable because it would
help ensure that ORF collection does not exceed the projected
regulatory costs for 2026. Particularly, the Exchange believes that
this temporary reduction in the ORF, taken together with the Exchange's
other regulatory fees and fines, would allow the Exchange to continue
covering a material portion of the projected regulatory costs, while
lessening the potential for generating excess funds that may otherwise
occur using the current rate.
The Proposal Is an Equitable Allocation of Fees
The Exchange also believes the proposed fee change is equitable and
not unfairly discriminatory in that it is charged to all Members on all
their transactions that clear in the customer range at the OCC.\13\ The
Exchange believes the ORF ensures fairness by assessing higher fees to
those members that require more Exchange regulatory services based on
the amount of customer options business they conduct. Regulating
customer trading activity is much more labor intensive and requires
greater expenditure of human and technical resources than regulating
non-customer trading activity, which tends to be more automated and
less labor-intensive. For example, there are costs associated with main
office and branch office examinations (e.g., staff expenses), as well
as investigations into customer complaints and the terminations of
registered persons. As a result, the costs associated with
administering the customer component of the Exchange's overall
regulatory program are materially higher than the costs associated with
administering the non-customer component (e.g., member proprietary
transactions) of its regulatory program. In addition to its own
surveillance programs, the Exchange also works with other SROs and
exchanges on intermarket surveillance related issues. Through its
participation in the Intermarket Surveillance Group (``ISG'') \14\ the
Exchange shares information and coordinates inquiries and
investigations with other exchanges designed to address potential
intermarket manipulation and trading abuses. Accordingly, there is a
strong nexus between the ORF and the Exchange's regulatory activities
with respect to customer trading activity of its Members.
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\13\ If the OCC clearing member is an Exchange Member, ORF is
assessed and collected on all cleared customer contracts (after
adjustment for CMTA); and (2) if the OCC clearing member is not an
Exchange Member, ORF is collected only on the cleared customer
contracts executed at the Exchange, taking into account any CMTA
instructions which may result in collecting the ORF from a non-
Member. ``CMTA'' or Clearing Member Trade Assignment is a form of
``give-up'' whereby the position will be assigned to a specific
clearing firm at OCC.
\14\ ISG is an industry organization formed in 1983 to
coordinate intermarket surveillance among the SROs by cooperatively
sharing regulatory information pursuant to a written agreement
between the parties. The goal of the ISG's information sharing is to
coordinate regulatory efforts to address potential intermarket
trading abuses and manipulations.
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The Proposal Is Not Unfairly Discriminatory
The Exchange believes that the proposal is not unfairly
discriminatory. The Exchange believes that the proposed temporary
decrease to the ORF rate would not place certain market participants at
an unfair disadvantage because it would apply to all Members subject to
the ORF and would allow the Exchange to continue to monitor the amount
collected from the ORF to help ensure that ORF collection, in
combination with other regulatory fees and fines, does not exceed
regulatory costs. The Exchange also has provided all such Members with
advance notice of the planned change to the ORF.\15\
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\15\ See supra note 6.
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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.
Intramarket Competition
The Exchange believes the proposed change would not impose an undue
burden on intramarket competition because the ORF is charged to all
Members on all their transactions that clear in the ``customer'' range
at the OCC; thus, the amount of ORF imposed is based on the amount of
customer volume transacted. The Exchange believes that the proposed
temporary decrease of the ORF would not place certain market
participants at an unfair disadvantage because all options transactions
must clear via a clearing firm. Such clearing firms can then choose to
pass through all, a portion, or none of the cost of the ORF to its
customers, i.e., the entering firms. The ORF is collected from Member
clearing firms by the OCC on behalf of the Exchange and is assessed on
all options transactions cleared at the OCC in the ``customer'' range.
Intermarket Competition
The proposed fee change is not designed to address any competitive
issues. Rather, the proposed change is designed to help the Exchange
adequately fund its regulatory activities while seeking to ensure that
total collections from regulatory fees do not exceed total regulatory
costs.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \16\ and paragraph (f) of Rule 19b-4 \17\
thereunder. At any time within 60 days of the filing of the proposed
rule change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.
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\16\ 15 U.S.C. 78s(b)(3)(A).
\17\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="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#4133342d246c222e2c2c242f3532013224226f262e37"><span class="__cf_email__" data-cfemail="592b2c353c743a3634343c372d2a192a3c3a773e362f">[email protected]</span></a>. Please include
file number SR-SAPPHIRE-2026-10 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.
[[Page 13363]]
All submissions should refer to file number SR-SAPPHIRE-2026-10. 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-SAPPHIRE-2026-10 and should be submitted
on or before April 9, 2026.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-05334 Filed 3-18-26; 8:45 am]
BILLING CODE 8011-01-P
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