Federal Register / Vol. 87, No. 57 / Thursday, March 24, 2022 / Notices 16809 

11 17 CFR 200.30–3(a)(57). 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6). 

5 See Securities Exchange Act Release No. 67091 

(May 31, 2012), 77 FR 33498 (June 6, 2012). The 

LULD Plan provides a mechanism to address 

extraordinary market volatility in individual 

securities. 

6 See Securities Exchange Act Release No. 85623 

(April 11, 2019), 84 FR 16086 (April 17, 2019). 

7 See Securities Exchange Act Release No. 85689 

(April 18, 2019), 84 FR 17217 (April 24, 2019) (SR– 

CboeBZX–2019–028). 

8 See Securities Exchange Act Release No. 87336 

(October 17, 2019), 84 FR 56868 (October 23, 2019) 

(SR–CboeBZX–2019–088). 

9 See Securities Exchange Act Release No. 90126 

(October 8, 2020), 85 FR 65119 (October 14, 2020) 

(SR–CboeBZX–2020–074). 

10 See Securities Exchange Act Release No. 93365 

(October 15, 2021) 86 FR 58342 (October 21, 2022) 

(SR–CboeBZX–2021–071). 

11 See Securities Exchange Act Release No. 67090 

(May 31, 2012), 77 FR 33531 (June 6, 2012) (SR– 

BATS–2011–038; SR–BYX–2011–025; SR–BX– 

2011–068; SR–CBOE–2011–087; SR–C2–2011–024; 

SR–CHX–2011–30; SR–EDGA–2011–31; SR–EDGX– 

2011–30; SR–FINRA–2011–054; SR–ISE–2011–61; 

SR–NASDAQ–2011–131; SR–NSX–2011–11; SR– 

NYSE–2011–48; SR–NYSEAmex–2011–73; SR– 

NYSEArca–2011–68; SR–Phlx–2011–129) (‘‘MWCB 

Approval Order’’). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–06194 Filed 3–23–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94464; File No. SR– 

CboeBZX–2022–023] 

Self-Regulatory Organizations; Cboe 

BZX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Extend the 

Pilot Related to the Market-Wide 

Circuit Breaker in Rule 11.18 to April 

18, 2022 

March 18, 2022. 

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 March 17, 

2022, Cboe BZX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BZX’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Exchange filed the 

proposal as a ‘‘non-controversial’’ 

proposed rule change pursuant to 

Section 19(b)(3)(A)(iii) of the Act 3 and 

Rule 19b–4(f)(6) thereunder.4 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 

Cboe BZX Exchange, Inc. (‘‘BZX’’ or 

the ‘‘Exchange’’) is filing with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) a proposal to 

extend the pilot related to the marketwide circuit breaker in Rule 11.18 to 

April 18, 2022. The text of the proposed 

rule change is provided in Exhibit 5. 

The text of the proposed rule change is 

also available on the Exchange’s website 

(http://markets.cboe.com/us/equities/ 

regulation/rule_filings/bzx/), 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 

BZX Rules 11.18(a) through (d), (f) 

and (g) describe the methodology for 

determining when to halt trading in all 

stocks due to extraordinary market 

volatility, i.e., market-wide circuit 

breakers. The market-wide circuit 

breaker (‘‘MWCB’’) mechanism was 

approved by the Commission to operate 

on a pilot basis, the term of which was 

to coincide with the pilot period for the 

Plan to Address Extraordinary Market 

Volatility Pursuant to Rule 608 of 

Regulation NMS (the ‘‘LULD Plan’’),5

including any extensions to the pilot 

period for the LULD Plan. In April 2019, 

the Commission approved an 

amendment to the LULD Plan for it to 

operate on a permanent, rather than 

pilot, basis.6 In light of the proposal to 

make the LULD Plan permanent, the 

Exchange amended Rule 11.18 to untie 

the pilot’s effectiveness from that of the 

LULD Plan and to extend the pilot’s 

effectiveness to the close of business on 

October 18, 2019.7 The Exchange 

subsequently amended Rule 11.18 to 

extend the pilot’s effectiveness to 

October 18, 2020,8 October 18, 2021,9

and March 18, 2022.10 The Exchange 

now proposes to amend Rule 11.18 to 

extend the pilot to the close of business 

on April 18, 2022. This filing does not 

propose any substantive or additional 

changes to Rule 11.18. 

The market-wide circuit breaker 

under Rule 11.18 provides an important, 

automatic mechanism that is invoked to 

promote stability and investor 

confidence during a period of 

significant stress when securities 

markets experience extreme broad-based 

declines. All U.S. equity exchanges and 

FINRA adopted uniform rules on a pilot 

basis relating to market-wide circuit 

breakers in 2012 (‘‘MWCB Rules’’), 

which are designed to slow the effects 

of extreme price movement through 

coordinated trading halts across 

securities markets when severe price 

declines reach levels that may exhaust 

market liquidity.11 Market-wide circuit 

breakers provide for trading halts in all 

equities and options markets during a 

severe market decline as measured by a 

single-day decline in the S&P 500 Index. 

Pursuant to Rule 11.18, a market-wide 

trading halt will be triggered if the S&P 

500 Index declines in price by specified 

percentages from the prior day’s closing 

price of that index. Currently, the 

triggers are set at three circuit breaker 

thresholds: 7% (Level 1), 13% (Level 2), 

and 20% (Level 3). A market decline 

that triggers a Level 1 or Level 2 halt 

after 9:30 a.m. ET and before 3:25 p.m. 

ET would halt market-wide trading for 

15 minutes, while a similar market 

decline at or after 3:25 p.m. ET would 

not halt market-wide trading. A market 

decline that triggers a Level 3 halt, at 

any time during the trading day, would 

halt market-wide trading for the 

remainder of the trading day. 

In the Spring of 2020, at the outset of 

the worldwide COVID–19 pandemic, 

U.S. equities markets experienced four 

MWCB Level 1 halts, on March 9, 12, 

16, and 18, 2020. In each instance, the 

markets halted as intended upon a 7% 

drop in the S&P 500 Index, and resumed 

as intended 15 minutes later. 

In response to these events, the 

previously-convened MWCB Taskforce 

(‘‘Taskforce’’) reviewed the March 2020 

halts and considered whether any 

immediate changes to the MWCB 

mechanism should be made. The 

Taskforce, consisting of representatives 

from equities exchanges, futures 


khammond on DSKJM1Z7X2PROD with NOTICES
16810 Federal Register / Vol. 87, No. 57 / Thursday, March 24, 2022 / Notices 

12 See Report of the Market-Wide Circuit Breaker 

(‘‘MWCB’’) Working Group Regarding the March 

2020 MWCB Events, submitted March 31, 2021 (the 

‘‘Study’’), available at https://www.nyse.com/ 

publicdocs/nyse/markets/nyse/Report_of_the_

MarketWide_Circuit_Breaker_Working_Group.pdf. 

13 See id. at 46. 

14 See Securities Exchange Act Release No. 92428 

(July 16, 2021), 86 FR 38776 (July 22, 2021) (SR– 

NYSE–2021–40) (the ‘‘NYSE Proposal’’). 

15 See Securities Exchange Act Release No. 

92785A (August 27, 2021), 86 FR 50202 (September 

7, 2021) (SR–NYSE–2021–40). 

16 See Securities Exchange Act Release No. 93212 

(September 30, 2021), 86 FR 55066 (October 5, 

2021) (SR–NYSE–2021–40). 

17 See Securities Exchange Act Release No. 93933 

(January 7, 2022), 87 FR 2189 (January 13, 2022) 

(SR–NYSE–2021–40). 

18 15 U.S.C. 78f(b). 

19 15 U.S.C. 78f(b)(5). 

exchanges, FINRA, broker-dealers, and 

other market participants, had been 

assembled in early 2020 to consider 

more generally potential changes to the 

MWCB mechanism. The Taskforce held 

ten meetings in the Spring and Summer 

of 2020 that were attended by 

Commission staff to consider, among 

other things: (1) Whether to retain the 

S&P 500 Index as the standard for 

measuring market declines; (2) whether 

halts that occur shortly after the 9:30 

a.m. market open cause more harm than 

good; and (3) what additional testing of 

the MWCB mechanism should be done. 

After considering data and anecdotal 

reports of market participants’ 

experiences during the March 2020 

MWCB events, the Taskforce did not 

recommend immediate changes be made 

to the use of the S&P 500 Index as the 

reference price against which market 

declines are measured, or to the current 

MWCB mechanism which permits halts 

even shortly after the 9:30 a.m. market 

open. The Taskforce recommended 

creating a process for a backup reference 

price in the event that the S&P 500 

Index becomes unavailable, and 

enhancing functional MWCB testing. 

The Taskforce also asked CME to 

consider modifying its rules to enter 

into a limit-down state in the futures 

pre-market after a 7% decline instead of 

5%. 

On September 17, 2020, the Director 

of the Division of Trading and Markets 

requested that the equities exchanges 

and FINRA prepare a more complete 

study of the design and operation of the 

MWCB mechanism and the LULD Plan 

during the period of volatility in the 

Spring of 2020. In response to the 

request, the SROs created a MWCB 

‘‘Working Group’’ composed of SRO 

representatives and industry advisers 

that included members of the advisory 

committees to both the LULD Plan and 

the NMS Plans governing the collection, 

consolidation, and dissemination of 

last-sale transaction reports and 

quotations in NMS Stocks. The Working 

Group met regularly from September 

2020 through March 2021 to consider 

the Commission’s request, review data, 

and compile its study. The Working 

Group’s efforts in this respect 

incorporated and built on the work of an 

MWCB Task Force. The Working Group 

submitted its study to the Commission 

on March 31, 2021 (the ‘‘Study’’).12 In 

addition to a timeline of the MWCB 

events in March 2020, the Study 

includes a summary of the analysis and 

recommendations of the MWCB Task 

Force; an evaluation of the operation of 

the Pilot Rules during the March 2020 

events; an evaluation of the design of 

the current MWCB system; and the 

Working Group’s conclusions and 

recommendations. In the Study, the 

Working Group concluded: (1) The 

MWCB mechanism set out in the Pilot 

Rules worked as intended during the 

March 2020 events; (2) the MWCB halts 

triggered in March 2020 appear to have 

had the intended effect of calming 

volatility in the market, without causing 

harm; (3) the design of the MWCB 

mechanism with respect to reference 

value (SPX), trigger levels (7%/13%/ 

20%), and halt times (15 minutes) is 

appropriate; (4) the change 

implemented in Amendment 10 to the 

Plan to Address Extraordinary Market 

Volatility (the ‘‘Limit Up/Limit Down 

Plan’’ or ‘‘LULD Plan’’) did not likely 

have any negative impact on MWCB 

functionality; and (5) no changes should 

be made to the mechanism to prevent 

the market from halting shortly after the 

opening of regular trading hours at 9:30 

a.m. In light of the foregoing 

conclusions, the Working Group also 

made several recommendations, 

including that the Pilot Rules should be 

permanent without any changes.13

The SROs have since worked on a 

proposed a rule change to make the 

Pilot Rules permanent, consistent with 

the Working Group’s recommendations. 

New York Stock Exchange (‘‘NYSE’’) 

filed such proposed rule change on July 

16, 2021.14 On August 27, 2021, the 

Commission extended its time to 

consider the proposed rule change to 

October 20, 2021.15 On September 30, 

2021, the Commission initiated 

proceedings to determine whether to 

approve or disapprove the proposed 

rule change.16 On January 7, 2022, the 

Commission extended its time to 

approve or disapprove the proposed 

rule change by an additional 60 days, to 

March 19, 2022.17 The Exchange now 

proposes to extend the expiration date 

of the Pilot Rules to the end of business 

on April 18, 2022. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,18 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,19

in particular, in that it is designed to 

promote just and equitable principles of 

trade, 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 

market-wide circuit breaker mechanism 

under Rule 11.18 is an important, 

automatic mechanism that is invoked to 

promote stability and investor 

confidence during a period of 

significant stress when securities 

markets experience extreme broad-based 

declines. Extending the market-wide 

circuit breaker pilot for an additional 

month would ensure the continued, 

uninterrupted operation of a consistent 

mechanism to halt trading across the 

U.S. markets while the Exchange and 

the other SROs work to make the Pilot 

Rules permanent. 

The Exchange also believes that the 

proposed rule change promotes just and 

equitable principles of trade in that it 

promotes transparency and uniformity 

across markets concerning when and 

how to halt trading in all stocks as a 

result of extraordinary market volatility. 

Based on the foregoing, the Exchange 

believes the benefits to market 

participants from the MWCB under Rule 

11.18 should continue on a pilot basis 

because the MWCB will promote fair 

and orderly markets, and protect 

investors and the public interest. 

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 because the 

proposal would ensure the continued, 

uninterrupted operation of a consistent 

mechanism to halt trading across the 

U.S. markets while the Exchange and 

the other SROs finalize their proposals 

to make the Pilot Rules permanent. 

Further, the Exchange understands that 

FINRA and other national securities 

exchanges will file proposals to extend 

their rules regarding the market-wide 

circuit breaker pilot following 

Commission approval of the NYSE 

proposal. Thus, the proposed rule 

change will help to ensure consistency 

across market centers without 

implicating any competitive issues. 


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Federal Register / Vol. 87, No. 57 / Thursday, March 24, 2022 / Notices 16811 

20 15 U.S.C. 78s(b)(3)(A). 

21 17 CFR 240.19b–4(f)(6). 

22 17 CFR 240.19b–4(f)(6). 

23 17 CFR 240.19b–4(f)(6)(iii). 

24 For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

25 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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 on the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: 

A. Significantly affect the protection 

of investors or the public interest; 

B. impose any significant burden on 

competition; and 

C. become operative for 30 days from 

the date on which it was filed, or such 

shorter time as the Commission may 

designate, it has become effective 

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

Act 20 and Rule 19b–4(f)(6) 21

thereunder. 

A proposed rule change filed under 

Rule 19b–4(f)(6) 22 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b–4(f)(6)(iii),23 the 

Commission may designate a shorter 

time if such action is consistent with the 

protection of investors and the public 

interest. The Exchange asked that the 

Commission waive the 30 day operative 

delay so that the proposal may become 

operative immediately upon filing. 

Extending the Pilot Rules’ effectiveness 

to the close of business on April 18, 

2022 will extend the protections 

provided by the Pilot Rules, which 

would otherwise expire in less than 30 

days. Waiver of the operative delay 

would therefore permit uninterrupted 

continuation of the MWCB pilot while 

the Commission reviews the NYSE’s 

proposed rule change to make the Pilot 

Rules permanent. Therefore, the 

Commission hereby waives the 30-day 

operative delay and designates the 

proposed rule change as operative upon 

filing.24

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 will 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 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

CboeBZX–2022–023 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–CboeBZX–2022–023. 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–CboeBZX–2022–023 

and should be submitted on or before 

April 14, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.25

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–06185 Filed 3–23–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94466; File No. SR– 

NASDAQ–2022–024] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Create a 

Monthly Media Enterprise License for 

the Distribution of Nasdaq Basic to the 

General Investing Public for Display 

Usage 

March 18, 2022. 

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 March 9, 

2022, The Nasdaq Stock Market LLC 

(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘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 the 

Exchange’s fees to create a monthly 

Media Enterprise License for the 

distribution of Nasdaq Basic to the 

general investing public for Display 

Usage. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/nasdaq/rules, 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 


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