Self-Regulatory Organizations; Miami International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Exchange Rule 515A, MIAX Price Improvement Mechanism (“PRIME”) and PRIME Solicitation Mechanism

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<title>Federal Register, Volume 91 Issue 199 (Friday, October 16, 2026)</title>
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[Federal Register Volume 91, Number 199 (Friday, October 16, 2026)]
[Notices]
[Pages 65818-65820]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-21134]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-106655; File No. SR-MIAX-2026-41]


Self-Regulatory Organizations; Miami International Securities 
Exchange, LLC; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend Exchange Rule 515A, MIAX Price 
Improvement Mechanism (``PRIME'') and PRIME Solicitation Mechanism

October 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 September 30, 2026, Miami International Securities Exchange, 
LLC (``MIAX'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') the 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 amend Exchange Rule 515A, MIAX Price 
Improvement Mechanism (``PRIME'') and PRIME Solicitation Mechanism, 
related to Request for Response (``RFR'') messages.
    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'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.

[[Page 65819]]

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 Exchange Rule 515A related to PRIME 
functionality. PRIME is a process by which a Member \3\ may 
electronically submit for execution (``Auction'') an order it 
represents as agent (``Agency Order'') against principal interest, and/
or an Agency Order against solicited interest.\4\ A Member (the 
``Initiating Member'') may initiate an Auction provided all of the 
following are met: (i) the Agency Order is in a class designated as 
eligible for PRIME as determined by the Exchange and within the 
designated Auction order eligibility size parameters as such size 
parameters are determined by the Exchange; (ii) the Initiating Member 
must stop the entire Agency Order as principal or with a solicited 
order at the better of the NBBO \5\ or the Agency Order's limit price 
(if the order is a limit order); and (iii) with respect to Agency 
Orders that have a size of less than 50 contracts, if at the time of 
receipt of the Agency Order, the NBBO has a bid/ask differential of 
$0.01, the System \6\ will reject the Agency Order.\7\ Members may use 
PRIME to execute complex orders at a net price. ``cPRIME'' is the 
process by which a Member may electronically submit a ``cPRIME Order'' 
(as defined in Rule 518(b)(7)) it represents as agent (a ``cPRIME 
Agency Order'') against principal or solicited interest for execution 
(a ``cPRIME Auction''), subject to the criteria enumerated in Policy 
.12 of Rule 515A.\8\
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    \3\ The term ``Member'' means an individual or organization 
approved to exercise the trading rights associated with a Trading 
Permit. Members are deemed ``members'' under the Exchange Act. See 
Exchange Rule 100.
    \4\ See Exchange Rule 515A(a).
    \5\ The term ``NBBO'' means the national best bid or offer as 
calculated by the Exchange based on market information received by 
the Exchange from OPRA. See Exchange Rule 100. The term ``OPRA'' 
means the Options Price Reporting Authority, LLC. See Exchange Rule 
100.
    \6\ The term ``System'' means the automated trading system used 
by the Exchange for the trading of securities. See Exchange Rule 
100.
    \7\ See Exchange Rule 515A(a)(1).
    \8\ See Exchange Rule 515A.12(a).
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    Specifically, the Exchange proposes to amend Exchange Rule 
515A(a)(2)(i)(D) \9\ related to Request for Response (``RFR'') messages 
for PRIME and cPRIME Auctions. Currently, the System will reject RFR 
responses submitted with a price that is not equal to or better than 
the initiating price. The Exchange now proposes to process these 
messages and to provide a cancellation message at the conclusion of the 
Auction.
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    \9\ Members may submit responses to the RFR (specifying prices 
and sizes). RFR responses shall be an Auction or Cancel (``AOC'') 
order or an AOC eQuote. The System will reject RFR responses 
submitted with a price that is not equal to or better than the 
initiating price. See Exchange Rule 515A(a)(2)(i)(D).
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    The Exchange notes that at least one other options exchange with a 
price improvement auction does not reject auction responses prior to 
the completion of the auction.\10\
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    \10\ See Nasdaq Phlx Rule Options 3, Section 13(b)(1)(I).
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\11\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act,\12\ in particular, in that it 
is 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 change is consistent with 
the Section 6(b)(5) \13\ requirement that the rules of an exchange not 
be designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
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    \11\ 15 U.S.C. 78f(b).
    \12\ 15 U.S.C. 78f(b)(5).
    \13\ Id.
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    The Exchange's proposal to not reject responses that are inferior 
to the initiating price is consistent with the Act because it will 
encourage responders to submit more aggressive prices resulting in 
greater price improvement. The proposed amendment protects investors 
and the public interest by introducing competitive uncertainty to the 
auction process to drive meaningful price improvement and prevent 
responders from anchoring to the initiating price. The Exchange 
believes that including all auction responses (i.e., not rejecting 
auction responses that are inferior to the initiating price) protects 
the integrity of the auction and will encourage aggressively priced 
responses to be submitted. Auction responses priced inferior to the 
initiating price that could not participate in the Auction will be 
cancelled at the conclusion of the Auction.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.
    The proposed change will not impose any burden on intramarket 
competition because all market participants that submit auction 
response messages will be treated in a similar fashion.
    The Exchange does not believe the proposed rule change will impose 
any burden on intermarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act because it 
relates to orders submitted into the PRIME or cPRIME Auction mechanism 
on the Exchange. Additionally, the Exchange notes that the rules of at 
least one other options exchange with a price improvement auction does 
not reject inferior priced responses until the completion of the 
auction.\14\
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    \14\ See supra note 10.
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    For all the reasons stated, the Exchange does not believe that the 
proposed rule change will impose any burden on competition not 
necessary or appropriate in furtherance of the purposes of the Act, and 
believes the proposed rule change will enhance 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

    Because the foregoing proposed rule change does not: (i) 
significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days after the date of the filing, or such 
shorter time as the Commission may designate, it has become effective 
pursuant to Section 19(b)(3)(A)(iii) of the Act \15\ and subparagraph 
(f)(6) of Rule 19b-4 thereunder.\16\
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    \15\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \16\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.

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[[Page 65820]]

    A proposed rule change filed under Rule 19b-4(f)(6) \17\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, Rule 19b-4(f)(6)(iii) \18\ permits the Commission to 
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 proposal 
may become operative immediately upon filing. The Exchange states that 
its proposal to amend its PRIME and cPRIME functionality to include all 
auction responses (i.e., not reject inferior priced auction responses) 
in the Auction and cancel responses that could not participate in the 
Auction at the conclusion of the Auction is similar to at least one 
other options exchange with a price improvement auction.\19\ The 
Exchange believes states that permitting the Exchange to immediately 
implement its proposal will improve execution quality by enhancing the 
auction process to the benefit of market participants by eliciting the 
best possible prices through competitive responses. For these reasons, 
and because the proposed rule change raises no new or novel legal or 
regulatory issues, the Commission finds that waiver of the 30-day 
operative delay is consistent with the protection of investors and the 
public interest. Accordingly, the Commission waives the 30-day 
operative delay and designates the proposed rule change to be operative 
upon filing.\20\
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    \17\ Id.
    \18\ 17 CFR 240.19b-4(f)(6)(iii).
    \19\ See supra note 10.
    \20\ 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 such 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 under 
Section 19(b)(2)(B) \21\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \21\ 15 U.S.C. 78s(b)(2)(B).
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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#86f4f3eae3abe5e9ebebe3e8f2f5c6f5e3e5a8e1e9f0"><span class="__cf_email__" data-cfemail="f785829b92da94989a9a92998384b7849294d9909881">[email&#160;protected]</span></a>. Please include 
file number SR-MIAX-2026-41 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-MIAX-2026-41. 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-MIAX-2026-41 and should be submitted on 
or before November 6, 2026.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\22\
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    \22\ 17 CFR 200.30-3(a)(12) and (59).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-21134 Filed 10-15-26; 8:45 am]
BILLING CODE 8011-01-P


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