Federal Register / Vol. 87, No. 12 / Wednesday, January 19, 2022 / Notices 2961 

16See supra note 4. 

17 15 U.S.C. 78s(b)(3)(A)(ii). 

18 17 CFR 240.19b–4(f)(2). 

19 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3A User is any Member or Sponsored Participant 

who is authorized to obtain access to the System. 

See Cboe BYX Rule 1.5(cc); Cboe BZX Rule 1.5(cc); 

Continued 

FINRA’s fees. The Exchange’s rule text 

will reflect the current registration rate 

that will be assessed by FINRA as of 

January 2, 2022. The proposed fee 

change is identical to that adopted by 

FINRA for use of Web CRD for the 

registration of FINRA members and 

their associated persons. These costs are 

borne by FINRA when a Non-FINRA 

member uses Web CRD. 

The Exchange believes that its 

proposal to increase the $100 fee for 

each initial Form U4 filed for the 

registration of a representative or 

principal to $125 is equitable and not 

unfairly discriminatory as the 

amendment will reflect the current fee 

that will be assessed by FINRA to all 

members who require Form U4 filings 

as of January 2, 2022. Further, the 

proposal is also equitable and not 

unfairly discriminatory because the 

Exchange will not be collecting or 

retaining these fees; therefore, the 

Exchange will not be in a position to 

apply them in an inequitable or unfairly 

discriminatory manner. The proposed 

rule change was based on recent fee 

adjustments currently assessed by 

FINRA.16 Thus, the proposed change 

does not raise any new or novel issues. 

For these reasons, the Exchange believes 

that the proposal is consistent with the 

Act. 

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 

Exchange believes that its proposal to 

increase the $100 fee for each initial 

Form U4 filed for the registration of a 

representative or principal to $125 does 

not impose an undue burden on 

competition as the amendment will 

reflect the current fee that will be 

assessed by FINRA to all members who 

require Form U4 filings as of January 2, 

2022. Further, the proposal does not 

impose an undue burden on 

competition because the Exchange will 

not be collecting or retaining these fees; 

therefore, the Exchange will not be in a 

position to apply them in an inequitable 

or unfairly discriminatory manner. 

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)(ii) of the Act,17 and Rule 

19b–4(f)(2) 18 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 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– 

EMERALD–2021–46 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Vanessa Countryman, Secretary, 

Securities and Exchange Commission, 

100 F Street NE, Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–EMERALD–2021–46. 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; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR– 

EMERALD–2021–46 and should be 

submitted on or before February 9, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–00881 Filed 1–18–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–93963; File Nos. SR– 

CboeBYX–2021–027; SR–CboeBZX–2021– 

076; SR–CboeEDGA–2021–024; SR– 

CboeEDGX–2021–048] 

Self-Regulatory Organizations; Cboe 

BYX Exchange, Inc.; Cboe BZX 

Exchange, Inc.; Cboe EDGA Exchange, 

Inc.; Cboe EDGX Exchange, Inc.; Order 

Granting Approval of Proposed Rule 

Changes To Amend Each Exchange’s 

Rules in Connection With a Risk 

Setting That Users May Elect To Apply 

to Their Orders in Hard To Borrow 

Securities 

January 12, 2022. 

I. Introduction 

On November 8, 2021, Cboe BYX 

Exchange, Inc. (‘‘CboeBYX’’) and Cboe 

BZX Exchange, Inc. (‘‘CboeBZX’’), and 

on November 18, 2021, Cboe EDGA 

Exchange, Inc. (‘‘CboeEDGA’’) and Cboe 

EDGX Exchange, Inc. (‘‘CboeEDGX,’’ 

and collectively, the ‘‘Exchanges’’), each 

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 allow each Exchange to offer 

its Users 3 a hard to borrow risk setting 


jspears on DSK121TN23PROD with NOTICES1
2962 Federal Register / Vol. 87, No. 12 / Wednesday, January 19, 2022 / Notices 

Cboe EDGA Rule 1.5(ee); and Cboe EDGX Rule 

1.5(ee). 

4See Securities Exchange Act Release Nos. 93638 

(November 22, 2021), 86 FR 67767 (SR–CboeBYX– 

2021–027) (‘‘BYX Notice’’); 93641 (November 22, 

2021), 86 FR 67763 (SR–CboeBZX–2021–076) 

(‘‘BZX Notice’’); 93642 (November 22, 2021), 86 FR 

67765 (SR–CboeEDGA–2021–024) (‘‘EDGA 

Notice’’); and 93643 (November 22, 2021), 86 FR 

67774 (SR–CboeEDGX–2021–048) (‘‘EDGX Notice’’). 

The proposed rule changes are nearly identical. 

5See Interpretation and Policy .01 to CboeBYX 

Rule 11.13; Interpretation and Policy .01 to 

CboeBZX Rule 11.13; Interpretation and Policy .01 

to CboeEDGA Rule 11.10; and Interpretation and 

Policy .01 to CboeEDGX Rule 11.10. 

6See BYX Notice at 67767; BZX Notice at 67764; 

EDGA Notice at 67765; and EDGX Notice at 67775. 

7 Id. 

8 Id. 

9 Id. 

10 Id. 

11 Id. 

12 Id. 

13See BYX Notice at 67767; BZX Notice at 67764; 

EDGA Notice at 67765; and EDGX Notice at 67775 

(citing Securities and Exchange Act Release No. 

50103 (July 28 2004), 69 FR 48007 (August 6, 2004) 

(Final Rule: Short Sales) at 48014, regarding hard 

to borrow lists and the locate requirements under 

17 CFR 242.203 (Regulation SHO Rule 203— 

Borrowing and delivery requirements)). 

14See BYX Notice at 67767; BZX Notice at 67764; 

EDGA Notice at 67766; and EDGX Notice at 67775. 

15 Id. 

16 Id. 

17 Id. 

18 Id. 

19 Id. 

20 Id. 

21 Id. 

22 In approving the proposed rule changes, the 

Commission notes that it has considered the 

proposed rules’ impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

23 15 U.S.C. 78f(b)(5). 

24See, e.g., Interpretation and Policy .01 to 

CboeBYX Rule 11.13(d); Interpretation and Policy 

.01 to CboeBZX Rule 11.13(d); Interpretation and 

Policy .01 to CboeEDGA Rule 11.10(d); and 

Interpretation and Policy .01 to CboeEDGX Rule 

11.10(d). 

25 15 U.S.C. 78f(b)(5). 

(‘‘Hard to Borrow List’’) that Users may 

elect to apply to their short sale orders 

in U.S. equity securities. The proposed 

rule changes were published for 

comment in the Federal Register on 

November 29, 2021.4

The Commission has received no 

comments on the proposed rule 

changes. This order approves the 

proposed rule changes. 

II. Description of the Proposed Rule 

Changes 

The Exchanges propose to include a 

Hard to Borrow List within their risk 

settings. The Exchanges currently offer 

certain optional risk settings applicable 

to a User’s activities on the Exchange.5

These risk settings currently provide 

Users with controls to restrict the types 

of securities transacted, including 

restricted securities and easy to borrow 

securities, as well as restricting activity 

to test symbols only.6

According to the Exchanges, when 

utilized, these optional risk tools act as 

a risk filter by evaluating a User’s orders 

to determine whether the orders comply 

with certain criteria established by the 

User.7 The proposal will offer Users an 

optional tool to evaluate whether their 

orders comply with User established 

criteria.8 Specifically, orders submitted 

in securities included on a User’s Hard 

to Borrow List will be rejected back to 

the User.9 The Hard to Borrow List 

resides at a User’s port level, a Userspecific logical session used to access 

the Exchange.10 Users may upload a 

Hard to Borrow List to their preferred 

port(s) via a web-based application 

programming interface.11 When 

uploaded to the port, Users may apply 

the setting to some or all of the marketparticipant identifiers (MPID) that they 

use to access the Exchange via the 

specified port.12

The Exchanges state that, as is the 

case with the Exchanges’ existing risk 

settings, the User, and not the Exchange, 

will have the full responsibility for 

ensuring that their orders comply with 

applicable securities rules, laws, and 

regulations, and may not rely on the 

Hard to Borrow List for any such 

purpose.13 Furthermore, use of the Hard 

to Borrow List does not automatically 

constitute compliance with Exchange 

Rules.14 The Exchanges state that they 

do not believe that the use of the Hard 

to Borrow List can replace Usermanaged risk management solutions.15

The Exchanges propose to make the 

risk setting available to their Users upon 

request and will not require Users to 

utilize the Hard to Borrow List.16 The 

Exchanges also state that they will not 

provide preferential treatment to Users 

using the Hard to Borrow List.17

In support of the proposal, the 

Exchanges assert the Hard to Borrow 

List will offer Users another option in 

efficient risk management of their access 

to the Exchange.18 For example, the 

Exchanges state the Hard to Borrow List 

may assist some Users in managing 

borrowing costs for their short sale 

transactions.19 According to the 

Exchanges, day over day borrowing 

costs in hard to borrow securities may 

be costly, and while a locate may be 

secured by a User prior to routing their 

short sale transactions to one of the 

Exchanges, borrowing costs may make 

such transactions less desirable.20 The 

Exchanges state by utilizing the Hard to 

Borrow List, Users have a tool that 

enables them to manage their costs by 

rejecting orders in such securities.21

III. Discussion and Commission 

Findings 

After careful review of the proposals, 

the Commission finds that the proposed 

rule changes are consistent with the 

requirements of the Act and the rules 

and regulations thereunder applicable to 

a national securities exchange.22 In 

particular, the Commission finds that 

the proposed rule changes are consistent 

with Section 6(b)(5) of the Act,23 which 

requires, among other things, that the 

Exchanges’ rules 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 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 Commission believes that the 

proposed rule changes are reasonably 

designed to provide a useful risk 

management tool to Users on the 

Exchanges. Adding a Hard to Borrow 

List could allow Users on the Exchanges 

to better manage borrowing costs for 

such securities. The Exchanges 

currently provide risk controls 

restricting certain transactions by 

symbol,24 and the Commission believes 

that the proposed rule change would 

provide an additional option for Users 

seeking to further tailor their risk 

management capability while 

transacting on the Exchanges. 

The Commission notes that the 

proposed Hard to Borrow List is an 

optional functionality. The Commission 

reminds Users electing to use the 

proposed risk control to be mindful of 

their obligations under all applicable 

securities laws, rules, and regulations 

and emphasizes that the proposed risk 

control is not a substitute for a Users’ 

own systems, processes, and procedures 

for compliance with such laws, rules, 

and regulations. The Commission 

expects the Exchanges to periodically 

assess whether its risk control settings 

are operating in a manner that is 

consistent with the promotion of fair 

and orderly markets. 

For the foregoing reasons, the 

Commission finds that the proposal is 

consistent with the requirements of the 

Act. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act 25 that the 

proposed rule changes (SR–CboeBYX– 

2021–027, SR–CboeBZX–2021–076, SR– 

CboeEDGA–2021–024, SR–CboeEDGX– 


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Federal Register / Vol. 87, No. 12 / Wednesday, January 19, 2022 / Notices 2963 

26 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Fee Schedule, Section 2)c). 

4See Securities Exchange Act Release No. 90176 

(October 14, 2020), 85 FR 66592 (October 20, 2020) 

(SR–FINRA–2020–032) (Notice of Filing and 

Immediate Effectiveness of a Proposed Rule Change 

to Adjust FINRA Fees to Provide Sustainable 

Funding for FINRA’s Regulatory Mission). 

5 Id. 

6 ‘‘Electronic Exchange Member’’ means the 

holder of a Trading Permit who is not a Market 

Maker. Electronic Exchange Members are deemed 

‘‘members’’ under the Exchange Act. See Exchange 

Rule 100. 

7 ‘‘Market Makers’’ means ‘‘Lead Market Makers,’’ 

‘‘Primary Lead Market Makers’’ and ‘‘Registered 

Market Makers’’ collectively. See Exchange Rule 

100. 

8See Securities Exchange Act Release No. 68415 

(December 12, 2012), 77 FR 74905 (December 18, 

2012) (SR–MIAX–2012–01). 

9See id. 

10 Id. 

11 Id. 

12 Id. FINRA operates Web CRD, the central 

licensing and registration system for the U.S. 

securities industry. FINRA uses Web CRD to 

maintain the qualification, employment and 

disciplinary histories of registered associated 

persons of broker-dealers. FINRA noted in its rule 

change that it was adjusting its fees to provide 

sustainable funding for FINRA’s regulatory mission. 

13 15 U.S.C. 78f(b). 

14 15 U.S.C. 78f(b)(5). 

15 Id. 

2021–048), be, and hereby are, 

approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.26

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–00876 Filed 1–18–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–93969; File No. SR–MIAX– 

2021–64] 

Self-Regulatory Organizations; Miami 

International Securities Exchange LLC; 

Notice of Filing and Immediate 

Effectiveness of a Proposed Rule 

Change by To Amend Its Fee Schedule 

January 12, 2022. 

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 December 29, 2021, Miami 

International Securities Exchange LLC 

(‘‘MIAX’’ 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 Options Fee Schedule 

(the ‘‘Fee Schedule’’) to reflect 

adjustments to the Financial Industry 

Regulatory Authority (‘‘FINRA’’) 

Registration Fees.3

While the changes proposed herein 

are effective upon filing, the Exchange 

has designated the amendments to 

become operative on January 2, 2022.4

The text of the proposed rule change 

is available on the Exchange’s website at 

http://www.miaxoptions.com/rulefilings, at MIAX’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 exa mined 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 

Section 2)c) of the Fee Schedule, Web 

CRD Fees, to reflect adjustments to the 

FINRA Registration Fees.5 The FINRA 

fees are collected and retained by 

FINRA via Web Central Registration 

Depository (‘‘CRD’’) for the registration 

of associated persons of MIAX 

Electronic Exchange Member 6 and 

Market Maker 7 organizations that are 

not also FINRA members (‘‘Non-FINRA 

members’’).8 The Exchange merely lists 

these fees in its Fee Schedule. The 

Exchange does not collect or retain 

these fees. 

Since January 2, 2013, FINRA has 

assessed, and the Exchange has listed in 

its Fee Schedule, a $100 fee for the 

FINRA CRD process [sic] fee.9 This fee 

is for all initial, transfer, relicense, and 

dual registration Form U4 filings.10 This 

fee is assessed when a non-FINRA firm 

(i.e., a firm that is not a member of 

FINRA) submits its first initial, transfer, 

relicense, or dual registration Form U4 

filing on behalf of a registered person.11

The Exchange now proposes to 

amend, under the General Registration 

Fees in Section 2)c) of the Fee Schedule, 

the FINRA CRD Processing Fee from 

$100 to $125 for each initial Form U4 

filed for the registration of a 

representative or principal. This 

amendment is made in accordance with 

a recent FINRA rule change to adjust its 

fees.12

The FINRA fees are collected and 

retained by FINRA via Web CRD for the 

registration of employees of the 

Exchange who are Non-FINRA 

members. The FINRA Web CRD Fees are 

user-based, and there is no distinction 

in the cost incurred by FINRA if the 

user is a FINRA member or a NonFINRA member. Accordingly, the 

proposed fees mirror those currently 

assessed by FINRA. The Exchange 

merely lists these fees in its Fee 

Schedule. The Exchange does not 

collect or retain these fees. 

Implementation 

The proposed rule change will 

become operative on January 2, 2022. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the Act 

and the rules and regulations 

thereunder applicable to the Exchange 

and, in particular, the requirements of 

Section 6(b) of the Act.13 Specifically, 

the Exchange believes the proposed rule 

change is consistent with the Section 

6(b)(5) 14 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 

the Section 6(b)(5) 15 requirement that 

the rules of an exchange not be designed 

to permit unfair discrimination between 

customers, issuers, brokers, or dealers. 

The Exchange believes it is reasonable 

to increase the $100 fee for each initial 

Form U4 filed for the registration of a 

representative or principal to $125 in 

accordance with an adjustment to 

FINRA’s fees. The Exchange’s rule text 


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