Federal Register / Vol. 83, No. 156 / Monday, August 13, 2018 / Notices 40099 

21 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Participants 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. 

4The Exchange uses reports from OCC when 

assessing and collecting the ORF. 

5CMTA or Clearing Member Trade Assignment is 

a form of ‘‘give-up’’ whereby the position will be 

assigned to a specific clearing firm at OCC. 

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–ISE–2018–69 and should be 

submitted on or before September 4, 

2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.21

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–17255 Filed 8–10–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meetings 

FEDERAL REGISTER CITATION OF PREVIOUS

ANNOUNCEMENT: 83 FR 25496, June 1, 

2018. 

PREVIOUSLY ANNOUNCED TIME AND DATE OF

THE MEETING: Tuesday, June 5, 2018 at 

10:00 a.m. 

CHANGES IN THE MEETING: The Open 

Meeting scheduled for Tuesday, June 5, 

2018 at 10:00 a.m. has been changed to 

Tuesday, June 5, 2018 at 11:30 a.m. The 

following items will not be considered 

during the Commission’s Open Meeting: 

• Whether to adopt a new rule as well 

as amendments to rules and forms to 

provide certain registered investment 

companies (‘‘funds’’) with an optional 

method to transmit shareholder reports. 

• whether to issue a release 

requesting comment about processing 

fees for delivering shareholder reports 

and other materials to fund investors. 

• whether to issue a release 

requesting comment from individual 

investors and other interested parties on 

how to enhance the delivery, design, 

and content of fund disclosures, 

including shareholder reports and 

prospectuses. 

CONTACT PERSON FOR MORE INFORMATION: 

For further information and to ascertain 

what, if any, matters have been added, 

deleted or postponed, please contact the 

Office of the Secretary at (202) 551– 

5400. 

Dated: June 4, 2018. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2018–17390 Filed 8–9–18; 11:15 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83794; File No. SR– 

NASDAQ–2018–062] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the 

Nasdaq Options Regulatory Fee 

August 7, 2018. 

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 July 27, 

2018, The Nasdaq Stock Market LLC 

(‘‘Nasdaq’’ or ‘‘Exchange’’) 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 revise The 

Nasdaq Options Market LLC’s Rules 

(‘‘NOM’’) at Chapter XV, Section 5 to 

amend the Nasdaq Options Regulatory 

Fee or ‘‘ORF.’’ 

While the changes proposed herein 

are effective upon filing, the Exchange 

has designated the amendments become 

operative on August 1, 2018. 

The text of the proposed rule change 

is available on the Exchange’s website at 

http://nasdaq.cchwallstreet.com/, at the 

principal office of the Exchange, 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 the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Currently, Nasdaq assesses an ORF of 

$0.0027 per contract side. The Exchange 

proposes to decrease this ORF to 

$0.0008 per contract side. In light of 

recent market volumes on NOM, the 

Exchange is proposing to change the 

amount of ORF that will be collected by 

the Exchange. The Exchange’s proposed 

change to the ORF should balance the 

Exchange’s regulatory revenue against 

the anticipated costs. 

Collection of ORF 

Currently, NOM assesses its ORF for 

each customer option transaction that is 

either: (1) executed by a Participant on 

NOM; or (2) cleared by a NOM 

Participant at The Options Clearing 

Corporation (‘‘OCC’’) in the customer 

range,3 even if the transaction was 

executed by a non-member of NOM, 

regardless of the exchange on which the 

transaction occurs.4 If the OCC clearing 

member is a NOM Participant, ORF is 

assessed and collected on all cleared 

customer contracts (after adjustment for 

CMTA5); and (2) if the OCC clearing 

member is not a NOM Participant, ORF 

is collected only on the cleared 

customer contracts executed at NOM, 

taking into account any CMTA 

instructions which may result in 

collecting the ORF from a non-member. 

By way of example, if Broker A, a 

NOM Participant, routes a customer 

order to CBOE and the transaction 

executes on CBOE and clears in Broker 

A’s OCC Clearing account, ORF will be 

collected by NOM from Broker A’s 

clearing account at OCC via direct debit. 

While this transaction was executed on 

a market other than NOM, it was cleared 

by a NOM Participant in the member’s 

OCC clearing account in the customer 

range, therefore there is a regulatory 

nexus between NOM and the 

transaction. If Broker A was not a NOM 

Participant, then no ORF should be 

assessed and collected because there is 

no nexus; the transaction did not 


sradovich on DSK3GMQ082PROD with NOTICES
40100 Federal Register / Vol. 83, No. 156 / Monday, August 13, 2018 / Notices 

6See Options Trader Alert #2018–27. 

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

8 15 U.S.C. 78f(b)(4) and (5). 

execute on NOM nor was it cleared by 

a NOM Participant. 

In the case where a Participant both 

executes a transaction and clears the 

transaction, the ORF is assessed to and 

collected from that Participant. In the 

case where a Participant executes a 

transaction and a different member 

clears the transaction, the ORF is 

assessed to and collected from the 

Participant who clears the transaction 

and not the Participant who executes 

the transaction. In the case where a nonmember executes a transaction at an 

away market and a Participant clears the 

transaction, the ORF is assessed to and 

collected from the Participant who 

clears the transaction. In the case where 

a Participant executes a transaction on 

NOM and a non-member clears the 

transaction, the ORF is assessed to the 

Participant that executed the transaction 

on NOM and collected from the nonmember who cleared the transaction. In 

the case where a Participant executes a 

transaction at an away market and a 

non-member clears the transaction, the 

ORF is not assessed to the Participant 

who executed the transaction or 

collected from the non-member who 

cleared the transaction because the 

Exchange does not have access to the 

data to make absolutely certain that ORF 

should apply. Further, the data does not 

allow the Exchange to identify the 

Participant executing the trade at an 

away market. 

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. 

The ORF is designed to recover a 

material portion of the costs to the 

Exchange of the supervision and 

regulation of its members, including 

performing routine surveillances, 

investigations, examinations, financial 

monitoring, and 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, will cover a 

material portion, but not all, of the 

Exchange’s regulatory costs. The 

Exchange will continue to monitor the 

amount of revenue collected from the 

ORF to ensure that it, in combination 

with its other regulatory fees and fines, 

does not exceed regulatory costs. If the 

Exchange determines regulatory 

revenues exceed regulatory costs, the 

Exchange will adjust the ORF by 

submitting a fee change filing to the 

Commission. 

Proposal 

The Exchange is proposing to 

decrease the ORF from $0.0027 to 

$0.0008 as of August 1, 2018. In light of 

recent market volumes on NOM, the 

Exchange is proposing to decrease the 

amount of ORF that will be collected by 

the Exchange. The Exchange regularly 

reviews its ORF to ensure that the ORF, 

in combination with its other regulatory 

fees and fines, does not exceed 

regulatory costs. The Exchange believes 

this adjustment will permit the 

Exchange to cover a material portion of 

its regulatory costs, while not exceeding 

regulatory costs. 

The Exchange notified Participants 

via an Options Trader Alert of the 

proposed change to the ORF thirty (30) 

calendar days prior to the proposed 

operative date, August 1, 2018.6 The 

Exchange believes that the prior 

notification market participants will 

ensure market participants are prepared 

to configure their systems to properly 

account for the ORF. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act 7 in general, and furthers the 

objectives of Sections 6(b)(4) and 6(b)(5) 

of the Act 8 in particular, in that it 

provides for the equitable allocation of 

reasonable dues, fees and other charges 

among members and issuers and other 

persons using its facility and is not 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

The Exchange believes that decreasing 

the ORF from $0.0027 to $0.0008 as of 

August 1, 2018 is reasonable because 

the Exchange’s collection of ORF needs 

to be balanced against the amount of 

regulatory costs incurred by the 

Exchange. The Exchange believes that 

the proposed adjustments noted herein 

will serve to balance the Exchange’s 

regulatory revenue against the 

anticipated regulatory costs. 

The Exchange believes that amending 

the ORF from $0.0027 to $0.0008 as of 

August 1, 2018 is equitable and not 

unfairly discriminatory because 

assessing the ORF to each Participant 

for options transactions cleared by OCC 

in the customer range where the 

execution occurs on another exchange 

and is cleared by a NOM Participant is 

an equitable allocation of reasonable 

dues, fees, and other charges among its 

members and issuers and other persons 

using its facilities. The ORF is collected 

by OCC on behalf of NOM from 

Exchange clearing members for all 

customer transactions they clear or from 

non-members for all customer 

transactions they clear that were 

executed on NOM. The Exchange 

believes the ORF ensures fairness by 

assessing fees to Participants 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. 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., 

Participant proprietary transactions) of 

its regulatory program. 

The ORF is designed to recover a 

material portion of the costs of 

supervising and regulating Participants’ 

customer options business including 

performing routine surveillances, 

investigations, examinations, financial 

monitoring, and policy, rulemaking, 

interpretive, and enforcement activities. 

The Exchange will monitor the amount 

of revenue collected from the ORF to 

ensure that it, in combination with its 

other regulatory fees and fines, does not 

exceed the Exchange’s total regulatory 

costs. The Exchange has designed the 

ORF to generate revenues that, when 

combined with all of the Exchange’s 

other regulatory fees, will be less than 

or equal to the Exchange’s regulatory 

costs, which is consistent with the 

Commission’s view that regulatory fees 

be used for regulatory purposes and not 

to support the Exchange’s business side. 

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. This 

proposal does not create an unnecessary 

or inappropriate intra-market burden on 

competition because the ORF applies to 

all customer activity, thereby raising 

regulatory revenue to offset regulatory 

expenses. It also supplements the 

regulatory revenue derived from noncustomer activity. This proposal does 


sradovich on DSK3GMQ082PROD with NOTICES
Federal Register / Vol. 83, No. 156 / Monday, August 13, 2018 / Notices 40101 

9 15 U.S.C. 78s(b)(3)(A)(ii). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The term ‘‘Member’’ means an individual or 

organization that is registered with the Exchange 

pursuant to Chapter II of the Exchange’s 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. 

not create an unnecessary or 

inappropriate inter-market burden on 

competition because it is a regulatory 

fee that supports regulation in 

furtherance of the purposes of the Act. 

The Exchange is obligated to ensure that 

the amount of regulatory revenue 

collected from the ORF, in combination 

with its other regulatory fees and fines, 

does not exceed regulatory costs. 

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 Act.9

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: (i) Necessary or appropriate in 

the public interest; (ii) for the protection 

of investors; or (iii) 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 

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 No. SR– 

NASDAQ–2018–062 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 No. 

SR–NASDAQ–2018–062. 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 No. 

SR–NASDAQ–2018–062, and should be 

submitted on or before September 4, 

2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–17258 Filed 8–10–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83785; File No. SR– 

PEARL–2018–16] 

Self-Regulatory Organizations; MIAX 

PEARL, LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend the MIAX 

PEARL Fee Schedule 

August 7, 2018. 

Pursuant to the provisions of 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 July 31, 2018, MIAX PEARL, LLC 

(‘‘MIAX PEARL’’ or ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’) a 

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 is filing a proposal to 

amend the MIAX PEARL Fee Schedule 

(the ‘‘Fee Schedule’’) to modify certain 

of the Exchange’s system connectivity 

fees. 

The text of the proposed rule change 

is available on the Exchange’s website at 

http://www.miaxoptions.com/rulefilings/pearl at MIAX PEARL’s principal 

office, 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 the 

Fee Schedule regarding connectivity to 

the Exchange. Specifically, the 

Exchange proposes to amend Sections 

5(a) and (b) of the Fee Schedule to 

increase the network connectivity fees 

for the 1 Gigabit (‘‘Gb’’) fiber 

connection, the 10Gb fiber connection, 

and the 10Gb ultra-low latency (‘‘ULL’’) 

fiber connection, which are charged to 

both Members 3 and non-Members of the 

Exchange for connectivity to the 

Exchange’s primary/secondary facility. 

The Exchange also proposes to increase 

the network connectivity fees for the 

1Gb and 10Gb fiber connections for 

connectivity to the Exchange’s disaster 

recovery facility. 


sradovich on DSK3GMQ082PROD with NOTICES