Federal Register / Vol. 83, No. 131 / Monday, July 9, 2018 / Notices 31825 

1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3MSCI LMMs would serve as MSCI LMMs during 

the RTH session only. 

technology. Consideration will be given 

to comments and suggestions submitted 

in writing within 60 days of this 

publication. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a currently valid 

control number. 

Please direct your written comment to 

Pamela Dyson, Director/Chief 

Information Officer, Securities and 

Exchange Commission, c/o Candace 

Kenner, 100 F Street NE, Washington, 

DC 20549 or send an email to: PRA_

Mailbox@sec.gov. 

Dated: July 3, 2018. 

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–14650 Filed 7–6–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83585; File No. SR–CBOE– 

2018–050] 

Self-Regulatory Organizations; Cboe 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend Its Fees 

Schedule To Adopt a Financial 

Incentive Program for Lead MarketMakers Appointed in MSCI EAFE Index 

Options and MSCI Emerging Markets 

Index Options 

July 2, 2018. 

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 July 2, 

2018, Cboe Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘Cboe Options’’) 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 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 Substance of 

the Proposed Rule Change 

The Exchange proposes to amend its 

Fees Schedule to adopt a financial 

incentive program for Lead MarketMakers appointed in MSCI EAFE Index 

(MXEA) options and MSCI Emerging 

Markets Index (MXEF) options 

(collectively, MSCI options), effective 

July 2, 2018. 

The text of the proposed rule change 

is available on the Exchange’s website 

(http://www.cboe.com/AboutCBOE/ 

CBOELegalRegulatoryHome.aspx), at 

the Exchange’s Office of the Secretary, 

and at the Commission’s Public 

Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 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 its 

Fees Schedule to adopt a financial 

incentive program for Lead MarketMakers appointed in MSCI EAFE Index 

(MXEA) options and MSCI Emerging 

Markets Index (MXEF) options 

(collectively, MSCI options), effective 

July 2, 2018. More specifically, the 

Exchange proposes to provide a 

financial incentive to any Market-Maker 

that is appointed as a Lead MarketMaker (‘‘LMM’’) in MXEA and/or MXEF 

(‘‘MSCI LMM’’) and meet a heightened 

quoting standard, to be set forth in the 

Fees Schedule.3 MSCI LMM(s) that meet 

the heightened quoting standard (which 

shall be explained herein), will receive 

$20,000 per month/per product. 

By way of background, pursuant to 

Rule 8.15(a), the Exchange may approve 

one or more Market-Makers to act as 

LMMs in a class for which a Designated 

Primary Market-Maker (‘‘DPM’’) has not 

been appointed, for a term of no less 

than the time until the end of the thencurrent expiration cycle. In addition to 

a LMM’s requirement to fulfill all 

obligations of a Market-Maker under the 

Exchange Rules, a LMM must also 

satisfy heightened quoting obligations 

set forth in Rule 8.15(b). 

The Exchange proposes to provide in 

the Fees Schedule that through 

December 31, 2018, if a MSIC LMM 

meets the heightened standard 

described below, the LMM in each class 

will receive $20,000 per month, per 

their respective appointed class. 

Specifically, the LMM will receive 

$20,000 per month/per class if it 

provides continuous electronic quotes 

that meet or exceed the following 

heightened quoting standards in at least 

90% of the MXEA and/or MXEF series 

it must quote pursuant to Rule 8.15(b) 

90% of the time in a given month: 

Premium level 

Expiring 7 days or less Near term 8 days to 60 

days 

Mid term 61 days to 270 

days 

Long term 271 days or 

greater 

Width Size Width Size Width Size Width Size 

$0–$5.00 ........................................................... $3.00 5 $1.50 20 $2.50 15 $5.00 10 

$5.01–$15.00 .................................................... 6.00 3 3.00 15 5.00 10 10.00 7 

$15.01–$50.00 .................................................. 15.00 2 7.50 10 10.00 7 20.00 5 

$50.01–$100.00 ................................................ 25.00 1 15.00 7 20.00 5 30.00 3 

$100.01–$200.00 .............................................. 40.00 1 25.00 3 35.00 3 48.00 2 

Greater Than $200.01 ....................................... 60.00 1 40.00 1 50.00 1 72.00 1 

The Exchange may consider other 

exceptions to this quoting standard 

based on demonstrated legal or 

regulatory requirements or other 

mitigating circumstances. For purposes 

of the financial benefit, MSCI LMM(s) 

will not be obligated to satisfy the 

heightened quoting standard shown 

above. Rather, the MSCI LMM(s) will 

only receive the financial benefit if they 

satisfy the abovementioned heightened 

quoting standard. If a MSCI LMM does 

not meet the heightened quoting 

standard, then it simply will not receive 

the financial benefit for that month. The 


sradovich on DSK3GMQ082PROD with NOTICES
31826 Federal Register / Vol. 83, No. 131 / Monday, July 9, 2018 / Notices 

4See e.g., Cboe Options Rule 8.7 and Rule 8.15. 

5See Cboe Options Fees Schedule, Footnotes 38 

and 49. 

6 15 U.S.C. 78f(b). 

7 15 U.S.C. 78f(b)(5). 

8 15 U.S.C. 78f(b)(4). 

9See Cboe Options Fees Schedule, Footnote 38, 

Cboe Options Rule 6.1A and Footnote 49. 

10 15 U.S.C. 78s(b)(3)(A). 

11 17 CFR 240.19b–4(f). 

Exchange notes however, that with 

respect to quoting obligations, MSCI 

LMM(s) must still comply with the 

continuous quoting obligation and other 

obligations of Market-Makers and LMMs 

described in Cboe Options Rules.4 The 

Exchange believes the proposed 

financial incentive for the additional 

quoting standard set forth in the Fees 

Schedule and described above, will 

further encourage MSCI LMMs to 

provide significant liquidity in MSCI 

options. Additionally, the Exchange 

notes that it expects that TPHs may 

need to undertake expenses to be able 

to quote at a significantly heightened 

standard in these classes, such as 

purchase additional bandwidth. The 

Exchange notes that the proposed 

financial incentive program for MSCI 

LMM(s) is similar to the rebate program 

adopted for ETH LMMs and SPX Select 

Market-Makers, as both programs offer 

financial benefits for meeting 

heightened quoting standards.5

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.6 Specifically, 

the Exchange believes the proposed rule 

change is consistent with the Section 

6(b)(5) 7 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 

Section 6(b)(4) of the Act,8 which 

requires that Exchange rules provide for 

the equitable allocation of reasonable 

dues, fees, and other charges among its 

Trading Permit Holders and other 

persons using its facilities. 

The Exchange believes it is reasonable 

to offer MSCI LMM(s) that meet a 

certain heightened quoting standard 

(described above) $20,000 per month, 

per product, given the potential added 

costs that MSCI LMM(s) may need to 

undertake in order to satisfy that 

heightened quoting standard (e.g., 

having to purchase additional 

bandwidth). The Exchange also wishes 

to ensure the LMM(s) is incentivized to 

provide liquid and active markets in the 

MSCI products to encourage its growth. 

Additionally, if a MSCI LMM does not 

satisfy the heightened quoting standard, 

then it simply will not receive the 

$20,000 per class for that month. 

The Exchange believes it is equitable 

and not unfairly discriminatory to only 

offer the financial incentive to MSCI 

LMM(s) because it benefits all market 

participants trading in MSCI options to 

encourage MSCI LMMs to satisfy the 

heightened quoting standards, which 

may increase liquidity and provide 

more trading opportunities and tighter 

spreads. Indeed, the Exchange notes that 

the LMM provides a crucial role in 

providing quotes and the opportunity 

for market participants to trade MSCI 

products, which can lead to increased 

volume, thereby providing a robust 

market. 

The Exchange notes that without the 

proposed financial incentive, there 

would not be sufficient incentive for 

Trading Permit Holders to undertake an 

obligation to quote an heightened levels, 

which could result in lower levels of 

liquidity. The MSCI LMM incentive 

program is also reasonable, as it 

designed to encourage increased quoting 

to add liquidity in MSCI products, 

thereby protecting investors and the 

public interest. 

The Exchange lastly notes that a 

similar financial incentive program was 

adopted for appointed LMMs in ETH 

and SPX Select Market-Makers.9

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule changes will impose 

any burden on competition that are not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange does not believe that the 

proposed rule change will impose any 

burden on intramarket competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act 

because, while the financial incentive is 

offered only to certain market 

participants (i.e., appointed MSCI 

LMM(s) that meet a heightened quoting 

standard), those market participants 

must meet heightened quoting standards 

to receive the financial incentive. 

Additionally, MSCI LMM(s) may incur 

additional costs to meet the heightened 

quoting standard. The Exchange 

believes the proposed financial 

incentive encourages those market 

participants to bring liquidity to the 

Exchange in MSCI options (which 

benefits all market participants). 

The Exchange does not believe that 

the proposed rule changes will impose 

any burden on intermarket competition 

that is not necessary or appropriate in 

furtherance of the purposes of the Act 

because MSCI options are proprietary 

products that will only be traded on 

Cboe Options. To the extent that the 

proposed changes make Cboe Options a 

more attractive marketplace for market 

participants at other exchanges, such 

market participants are welcome to 

become Cboe Options 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 

The foregoing rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 10 and paragraph (f) of Rule 

19b–4 11 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. 

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 


sradovich on DSK3GMQ082PROD with NOTICES
Federal Register / Vol. 83, No. 131 / Monday, July 9, 2018 / Notices 31827 

12 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 82439 

(Jan. 3, 2018), 83 FR 1062. 

4 15 U.S.C. 78s(b)(2). 

5See Securities Exchange Act Release No. 82757, 

83 FR 8532 (Feb. 27, 2018). 

6 15 U.S.C. 78s(b)(2)(B). 

7See Securities Exchange Act Release No. 83007, 

83 FR 15883 (Apr. 12, 2018). 

8 15 U.S.C. 78s(b)(2). 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

CBOE–2018–050 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–CBOE-2018–050. 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 the 

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–CBOE–2018–050 and 

should be submitted on or before July 

30, 2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–14550 Filed 7–6–18; 8:45 am] 

BILLING CODE P 

SECURITIES AND EXCHANGE 

COMMISSION 

Proposed Collection; Comment 

Request 

Upon Written Request Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Extension: 

Form SE, SEC File No. 270–289, OMB 

Control No. 3235–0327 

Notice is hereby given that, pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the Securities 

and Exchange Commission 

(‘‘Commission’’) is soliciting comments 

on the collection of information 

summarized below. The Commission 

plans to submit this existing collection 

of information to the Office of 

Management and Budget for extension 

and approval. 

Form SE (17 CFR 239.64) is used by 

registrants to file paper copies of 

exhibits, reports or other documents 

that would be difficult or impossible to 

submit electronically, as provided in 

Rule 311 of Regulation S–T (17 CFR 

232.311). The information contained in 

Form SE is used by the Commission to 

identify paper copies of exhibits. Form 

SE is filed by individuals, companies or 

other entities that are required to file 

documents electronically. 

Approximately 19 registrants file Form 

SE and it takes an estimated 0.10 hours 

per response for a total annual burden 

of 2 hours (0.10 hours per response × 19 

responses). 

Written comments are invited on: (a) 

Whether the proposed collection of 

information is necessary for the proper 

performance of the functions of the 

agency, including whether the 

information will have practical utility; 

(b) the accuracy of the agency’s estimate 

of the burden imposed by the collection 

of information; (c) ways to enhance the 

quality, utility, and clarity of the 

information collected; and (d) ways to 

minimize the burden of the collection of 

information on respondents, including 

through the use of automated collection 

techniques or other forms of information 

technology. Consideration will be given 

to comments and suggestions submitted 

in writing within 60 days of this 

publication. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

unless it displays a currently valid 

control number. 

Please direct your written comment to 

Pamela Dyson, Director/Chief 

Information Officer, Securities and 

Exchange Commission, c/o Candace 

Kenner, 100 F Street NE, Washington, 

DC 20549 or send an email to: PRA_

Mailbox@sec.gov. 

Dated: July 3, 2018. 

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–14654 Filed 7–6–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83588; File No. SR– 

NASDAQ–2017–128] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Designation of a Longer Period for 

Commission Action on Proceedings To 

Determine Whether To Approve or 

Disapprove a Proposed Rule Change 

To List and Trade the Shares of the 

Western Asset Total Return ETF 

July 3, 2018. 

On December 20, 2017, The Nasdaq 

Stock Market LLC (‘‘Nasdaq’’) filed with 

the Securities and Exchange 

Commission (‘‘Commission’’), pursuant 

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

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 

change to list and trade shares of the 

Western Asset Total Return ETF, a 

series of Legg Mason ETF Investment 

Trust, under Nasdaq Rule 5735. The 

proposed rule change was published for 

comment in the Federal Register on 

January 9, 2018.3 The Commission has 

received no comments on the proposed 

rule change. 

On February 21, 2018, pursuant to 

Section 19(b)(2) of the Act,4 the 

Commission designated a longer period 

within which to approve the proposed 

rule change, disapprove the proposed 

rule change, or institute proceedings to 

determine whether to disapprove the 

proposed rule change.5 On April 6, 

2018, the Commission instituted 

proceedings under Section 19(b)(2)(B) of 

the Act 6 to determine whether to 

approve or disapprove the proposed 

rule change.7 The Commission has 

received no comments on the proposed 

rule change. 

Section 19(b)(2) of the Act 8 provides 

that, after initiating disapproval 

proceedings, the Commission shall issue 

an order approving or disapproving the 

proposed rule change not later than 180 


sradovich on DSK3GMQ082PROD with NOTICES