Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices 84063 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

5Transactions executed through the Solicitation 

Auction mechanism and Facilitation Auction 

mechanism. 

6The Exchange notes that no fees are currently 

assessed for Agency Orders for any account type. 

7Facilitation and Solicitation Orders are the 

matching contra orders submitted on the opposite 

side of the Agency Order. 

8The Exchange notes that the total fees for 

Responses in the Facilitation and Solicitation 

auction mechanisms are not changing. Currently, 

Participants are assessed a $0.25 fee for Responses 

in the Facilitation and Solicitation mechanisms for 

Penny Interval Classes and an additional $0.25 

liquidity fee in Section III.B totaling $0.50 for their 

order. For Non-Penny Pilot Classes, Participants are 

assessed a $0.40 fee for Responses in the 

Facilitation and Solicitation mechanisms and an 

additional $0.75 liquidity fee in Section III.B 

totaling $1.15 for their order. As discussed herein, 

the Exchange proposes to eliminate Liquidity Fees 

and Credits for Facilitation and Solicitation 

transactions when the Trading Floor is inoperable. 

As such, the current liquidity fees are included in 

the proposed Response fees for the Facilitation and 

Solicitation mechanisms. 

9The Exchange notes that the QOO Orders are 

paired orders on the BOX Trading Floor similar to 

Facilitation and Solicitation orders submitted 

electronically through the Facilitation and 

Solicitation auction mechanism. The Exchange 

believes that the reduced Facilitation and 

Solicitation Order fees will incentivize Floor 

Participants (who are also electronic Participants on 

BOX) to execute orders electronically instead of 

directing this order flow to another exchange. 

respond to, a collection of information 

unless it displays a currently valid 

control number. 

Please direct your written comment to 

David Bottom, Director/Chief 

Information Officer, Securities and 

Exchange Commission, c/o Cynthia 

Roscoe, 100 F Street NE, Washington, 

DC 20549 or send an email to: PRA_

Mailbox@sec.gov. 

Dated: December 18, 2020. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2020–28430 Filed 12–22–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90698; File No. SR–BOX– 

2020–39] 

Self-Regulatory Organizations; BOX 

Exchange LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend the Fee 

Schedule on the BOX Options Market 

LLC Facility 

December 17, 2020. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on December 

15, 2020, BOX Exchange LLC 

(‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘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 proposed rule change 

pursuant to Section 19(b)(3)(A)(ii) of the 

Act,3 and Rule 19b–4(f)(2) thereunder,4

which renders the proposal effective 

upon filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

The Exchange is filing with the 

Securities and Exchange Commission 

(‘‘Commission’’) a proposed rule change 

to amend the Fee Schedule on the BOX 

Options Market LLC (‘‘BOX’’) facility. 

The text of the proposed rule change is 

available from the principal office of the 

Exchange, at the Commission’s Public 

Reference Room and also on the 

Exchange’s internet website at http://

boxexchange.com. 

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 

To prevent the potential spread of 

coronavirus (COVID–19), BOX Exchange 

LLC (BOX) temporarily closed the 

Trading Floor in Chicago after the close 

of business on Thursday, December 10, 

2020 but reopened on Monday, 

December 14, 2020 after existing BOX 

COVID–19 policies and procedures were 

executed. As a result of this and the 

uncertainty surrounding COVID–19, the 

Exchange proposes to amend the Fee 

Schedule for trading on BOX to govern 

certain pricing changes that will be in 

effect while the BOX Trading Floor is 

inoperable. 

Facilitation and Solicitation Transaction 

Fees 

First, the Exchange proposes to 

amend Section I.C. (Facilitation and 

Solicitation Transactions 5) to establish 

a fee structure for Facilitation and 

Solicitation Transactions in lieu of the 

current fees for Facilitation and 

Solicitation Transactions while the BOX 

Trading Floor is inoperable. Further, the 

Exchange proposes that the Facilitation 

and Solicitation Transaction Rebate 

identified in Section I.C.1 will not apply 

when the BOX Trading Floor is 

inoperable. With the Trading Floor 

inoperable, Floor Participants will no 

longer be allowed to enter Qualified 

Open Outcry Orders (‘‘QOO’’) Orders on 

BOX. Instead these Participants must 

enter analogous types of electronic 

orders on BOX, which are most similar 

to orders executed through the 

Facilitation and Solicitation auction 

mechanism. Because of this, the 

Exchange proposes to mimic the current 

structure for Facilitation and 

Solicitation Transactions; however the 

Exchange proposes to make a few minor 

changes to the fees assessed for these 

transactions when the Trading Floor is 

inoperable. Specifically, the Exchange 

proposes to assess no fees for Agency 

Orders submitted to the Facilitation and 

Solicitation mechanisms for all 

Participants, regardless of account 

type.6 Second, the Exchange proposes to 

assess no fees for Facilitation and 

Solicitation Orders 7 in Penny and NonPenny Interval Classes. BOX also 

proposes to assess a $0.50 fee for 

Responses in the Facilitation or 

Solicitation Auction Mechanisms in 

Penny Interval Classes and $1.15 for 

Responses in the Facilitation and 

Solicitation mechanisms in Non-Penny 

Interval Classes.8 The Exchange believes 

the proposed fee structure will 

incentivize Participants who would 

normally execute orders on the BOX 

Trading Floor to instead submit orders 

to the Exchange’s Facilitation and 

Solicitation auction mechanisms.9

Liquidity Fees and Credits 

The Exchange proposes to add text to 

Section III.B. (Liquidity Fees and 

Credits for Facilitation and Solicitation 

Transactions). Specifically, the 

Exchange proposes to add text which 

states that Participants will not be 

assessed Liquidity Fees and Credits for 

Facilitation and Solicitation 

Transactions when the BOX Trading 

Floor is inoperable. 


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84064 Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices 

10 15 U.S.C. 78f(b)(4) and (5). 

11The Exchange notes that the QOO Orders are 

paired orders on the BOX Trading Floor similar to 

Facilitation and Solicitation orders submitted 

electronically through the Facilitation and 

Solicitation auction mechanism. Under this 

proposal, Floor Participants (who are also electronic 

Participants on BOX) will be able to execute orders 

electronically despite the Trading Floor being 

closed. 

12See Securities Exchange Act Release No. 88559 

(April 3, 2020), 85 FR 19968 (April 9, 2020) (SR– 

BOX–2020–08). The Exchange notes that the 

proposal discussed herein differs slightly from the 

proposal approved in April 2020. Here, the 

Exchange does not intend to waive the Participant 

Fees (detailed in Section IX) while the Trading 

Floor is inoperable. The waiver of the Floor 

Participant Fees in the April 2020 filing was 

appropriate as, at the time, the BOX Trading Floor 

closed indefinitely. This is no longer the case. Since 

reopening the BOX Trading Floor, BOX has put in 

place robust policies and procedures regarding the 

closure and reopening of the Trading Floor due to 

COVID–19. As such, BOX does not anticipate 

having to close the Trading Floor again for an 

indefinite amount of time. 

13The Exchange notes that it previously did not 

charge Broker Dealers, Professional Customers and 

Market Makers for Facilitation and Solicitation 

Orders in the Facilitation and Solicitation 

mechanism. See SR–BOX–2015–29. 

14See supra note 8. 

15The Exchange again notes that no fees are 

assessed for Agency Orders for any account type. 

2. Statutory Basis 

The Exchange believes that the 

proposal is consistent with the 

requirements of Section 6(b) of the Act, 

in general, and Section 6(b)(4) and 

6(b)(5)of the Act,10 in particular, in that 

it provides for the equitable allocation 

of reasonable dues, fees, and other 

charges among BOX Participants and 

other persons using its facilities and 

does not unfairly discriminate between 

customers, issuers, brokers or dealers. 

The proposed changes are due to the 

closing of the BOX Trading Floor as of 

December 11, 2020. The Exchange 

believes the proposed changes 

discussed herein will incentivize 

Participants to direct order flow that 

would have otherwise been executed on 

the BOX Trading Floor, to be executed 

through the Exchange’s Facilitation and 

Solicitation auction mechanisms while 

the Trading Floor is inoperable.11 The 

Exchange notes that a substantially 

similar proposal was effective upon 

filing in April 2020.12

Facilitation and Solicitation Transaction 

Fees 

The Exchange believes that the 

proposed fee structure for Facilitation 

and Solicitation Transactions while the 

Trading Floor is inoperable is 

reasonable, equitable and not unfairly 

discriminatory. The Exchange notes that 

assessing no Agency Order fees is in 

line with the Exchange’s current fee 

structure for Facilitation and 

Solicitation Transactions. Further, the 

Exchange believes that assessing no fees 

for Facilitation and Solicitation Orders 

in the Facilitation and Solicitation 

auction mechanism is reasonable.13 As 

discussed above, the Exchange believes 

that assessing no fees for Facilitation 

and Solicitation Orders will attract 

order flow to these mechanisms that 

would have otherwise been executed on 

the BOX Trading Floor. The Exchange 

believes the proposed change will 

incentivize Participants to direct their 

orders to the Exchange’s mechanisms 

(instead of directing these orders that 

would have normally executed on the 

BOX Trading Floor to other exchanges 

in the industry) which will result in 

greater liquidity and ultimately benefit 

all Participants trading on the Exchange. 

Further, the Exchange believes that the 

proposed change is equitable and not 

unfairly discriminatory, as the proposed 

change applies to all Participants, 

regardless of account type. 

The Exchange believes that the 

proposed fees for Responses in the 

Facilitation and Solicitation auction 

mechanisms are reasonable. As 

discussed above, the Exchange is 

removing Liquidity Fees and Credits for 

the Facilitation and Solicitation 

mechanisms. With the Liquidity Fees 

and Credits removed, the Exchange is 

transferring the fee for adding liquidity 

($0.25 for Penny Pilot Class and $0.75 

Non-Penny Pilot Classes) and adding 

these fees to the proposed Response 

fees. BOX Participants responding to the 

Facilitation and Solicitation orders will 

not be charged any differently than they 

are today.14 Further, the Exchange 

believes that the proposed fees are 

equitable and not unfairly 

discriminatory because the fees are 

assessed to all Participants, regardless of 

account type. 

The Exchange also believes it is 

reasonable, equitable and not unfairly 

discriminatory to charge higher 

exchange fees for responders in the 

Facilitation and Solicitation auctions 

than for initiators of these orders and 

the contra orders. The Exchange again 

notes that the total transaction fee for 

Responses in the Facilitation and 

Solicitation mechanisms is not 

changing. The Exchange is simply 

including the liquidity fees in Section 

III.B. to the fees for Responses in the 

Facilitation and Solicitation 

mechanisms which are currently 

assessed today. While the Exchange is 

decreasing the fees for Facilitation and 

Solicitation orders and creating a larger 

disparity between the Initiator and 

Responder, the Exchange believes that 

the differential between what an 

Initiator will pay compared to what a 

Responder will pay is reasonable 

because Responders are willing to pay a 

higher fee for liquidity discovery. The 

Exchange believes that assessing no fees 

for Agency Orders and Facilitation and 

Solicitation Orders will attract more 

liquidity to these mechanisms 

ultimately providing Responders with 

increased opportunity for executions on 

the Exchange. Despite the increased 

differential between the Initiator and 

Responder, the Exchange again notes 

that Responders are not paying any 

more than what they currently pay for 

responses in these mechanisms today. 

Further, the Exchange believes the 

proposed fees for Responders are 

equitable and not unfairly 

discriminatory as they apply to all 

Participants, regardless of account type. 

The Exchange further believes it is 

reasonable to establish different fees for 

Responses to Facilitation and 

Solicitation transactions in Penny Pilot 

Classes compared to transactions in 

Non-Penny Pilot Classes. The Exchange 

makes this distinction throughout the 

BOX Fee Schedule, including the 

Exchange Fees for PIP and COPIP 

Transactions. The Exchange believes it 

is reasonable to establish higher fees for 

Non-Penny Pilot Classes because these 

Classes are typically less actively traded 

and have wider spreads. 

Liquidity Fees and Credits 

Currently, the Liquidity Fees and 

Credits fee structure for Facilitation and 

Solicitation transactions, in particular 

the credit for removing liquidity, aims 

to attract order flow to the BOX auction 

mechanisms. The Exchange believes 

that eliminating the Liquidity Fees and 

Credits for Facilitation and Solicitation 

Transactions when the Trading Floor is 

inoperable is reasonable as the 

Exchange has, pursuant to this proposal, 

eliminated Facilitation and Solicitation 

Order fees.15 Market participants no 

longer need the incentive of a credit for 

removing liquidity when there are no 

fees assessed for Agency Orders and 

Facilitation and Solicitation Orders in 

the Facilitation and Solicitation auction 

mechanism. Further, the Exchange 

believes the proposed change is 

equitable and not unfairly 

discriminatory in that the change will 

apply to all categories of Participants 

and across all account types. 

Finally, the Exchange notes that it 

operates in a highly competitive market 

in which market participants can 

readily favor competing exchanges. In 

such an environment, the Exchange 

must continually review, and consider 

adjusting, its fees to remain competitive 


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Federal Register / Vol. 85, No. 247 / Wednesday, December 23, 2020 / Notices 84065 

16 15 U.S.C. 78s(b)(3)(A)(ii). 

17 17 CFR 240.19b–4(f)(2). 

18 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

with other exchanges. For the reasons 

described above, the Exchange believes 

that the proposed rule change reflects 

this competitive environment. 

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 not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange believes that the proposed 

changes to the Facilitation and 

Solicitation Transaction fees will not 

impose a burden on competition among 

various Exchange Participants. Rather, 

BOX believes that the change will result 

in the Participants being charged 

appropriately for these transactions and 

are designed to enhance competition in 

the Facilitation and Solicitation 

mechanisms. Submitting an order is 

entirely voluntary and Participants can 

determine which order type they wish 

to submit, if any, to the Exchange. 

Further, the Exchange believes that this 

proposal will enhance competition 

between exchanges because it is 

designed to allow the Exchange to better 

compete with other exchanges for order 

flow. The Exchange does not believe 

that the proposed change will burden 

competition by creating a disparity 

between the fees an initiator pays and 

the fees a competitive responder pays 

that would result in certain Participants 

being unable to compete with initiators. 

In fact, the Exchange believes that these 

changes will not impair these 

Participants from adding liquidity and 

competing in the Facilitation and 

Solicitation mechanisms, and will help 

promote competition by providing 

incentives for market participants to 

submit Facilitation and Solicitation 

Orders, and thus benefit all Participants 

trading on the Exchange by attracting 

customer order flow. 

Lastly, the Exchange believes that 

eliminating the Liquidity Fees and 

Credits for Facilitation and Solicitation 

Transactions will not burden 

competition as the proposed change 

applies to all market participants. As 

discussed above, the Exchange believes 

that eliminating the Liquidity Fees and 

Credits for Facilitation and Solicitation 

Transactions is reasonable as the 

Exchange, pursuant to this proposal, has 

eliminated Facilitation and Solicitation 

Order fees. Therefore, the credit for 

removing liquidity is no longer needed 

to incentivize Participants to submit 

order flow to the Facilitation and 

Solicitation auction mechanisms. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or 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)(ii) of the Exchange Act 16

and Rule 19b–4(f)(2) thereunder,17

because it establishes or changes a due, 

or fee. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend the rule change if 

it appears to the Commission that the 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or would otherwise further 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

BOX–2020–39 on the subject line. 

Paper Comments 

• 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–BOX–2020–39. 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 (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549 on official 

business days between the hours of 

10:00 a.m. and 3:00 p.m. Copies of such 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–BOX–2020–39, and should 

be submitted on or before January 13, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.18

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2020–28305 Filed 12–22–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90713; File No. SR– 

CboeEDGX–2020–063] 

Self-Regulatory Organizations; Cboe 

EDGX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Amend 

EDGX Rule 11.8(g), Which Describes 

the Handling of MidPoint Discretionary 

Orders Entered on the Exchange 

December 17, 2020. 

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 December 

15, 2020, 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 


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