Federal Register / Vol. 87, No. 56 / Wednesday, March 23, 2022 / Notices 16525 

14 15 U.S.C. 78s(b)(3)(A)(ii). 

15 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. 

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.14

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 Number SR– 

NASDAQ–2022–025 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–NASDAQ–2022–025. 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–NASDAQ–2022–025 and 

should be submitted on or before April 

13, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–06092 Filed 3–22–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94444; File No. SR–GEMX– 

2022–05] 

Self-Regulatory Organizations; Nasdaq 

GEMX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Harmonize Various 

Processes Under Options 3, Section 20 

Across the Affiliated Nasdaq Options 

Exchanges 

March 17, 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 8, 

2022, Nasdaq GEMX, LLC (‘‘GEMX’’ 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 Harmonize 

various processes under Options 3, 

Section 20 across the affiliated Nasdaq 

options exchanges. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/gemx/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 

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 harmonize 

its existing processes with those of its 

affiliate Nasdaq Phlx LLC (‘‘Phlx’’) 

concerning the review of decisions on 

appeal under Options 3, Section 20. The 

Exchange also proposes a number of 

non-substantive changes. Each change is 

discussed in detail below. 

Appeal 

Today, Options 3, Section 20(k) 

governs the appeal process for 

determinations by Exchange staff made 

under this Rule, including obvious error 

determinations. Specifically, if a 

Member affected by a determination 

under this Rule so requests within the 

permitted time period, an Exchange 

Review Council panel will review 

decisions made by the Official under 

Options 3, Section 20, including 

whether an obvious error occurred and 

whether the correct determination was 

made. A request for review on appeal 

must be made in writing via email or 

other electronic means specified from 

time to time by the Exchange in an 

Options Trader Alert distributed to 

Members within thirty (30) minutes 

after the party making the appeal is 

given notification of the initial 

determination being appealed. The 


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16526 Federal Register / Vol. 87, No. 56 / Wednesday, March 23, 2022 / Notices 

3 See Phlx Options 3, Section 20(l). 

4 See Phlx Options 3, Section 20(l) for analogous 

language. 

5 See Phlx Options 3, Section 20(l). The Nasdaq 

Options Market (‘‘NOM’’) and BX Options (‘‘BX’’) 

also have identical $500 Appeal Fees. See NOM and 

BX Options 3, Section 20(k)(4). 

6 For purposes of Options 3, Section 20, an 

Official is an Officer of the Exchange or such other 

employee designee of the Exchange that is trained 

in the application of this Rule. See Options 3, 

Section 20(a)(3). 

7 The Exchange’s application for registration as a 

national securities exchange, as approved by the 

Commission, incorporated this provision. See 

Securities Exchange Act Release No. 70050 (July 26, 

2013), 78 FR 46622 (August 1, 2013). 

8 See Securities Exchange Act Release No. 74897 

(May 7, 2015), 80 FR 27415 (May 13, 2015) (SR– 

ISEGemini–2015–11). 

9 In particular, the Exchange proposes to update 

the following subparagraphs in Options 3, Section 

20: (c)(2), (d)(2), (g), (h), (i), (l)(1)(A), (l)(1)(B), 

(l)(1)(C), and (l)(2)(A). The Exchange also proposes 

to update Supplementary Material .03 to Options 3, 

Section 20. 

10 See BX, NOM, and Phlx Options 3, Section 20. 

11 See Securities Exchange Act Release No. 93675 

(November 29, 2021), 86 FR 68714 (December 3, 

2021) (SR–NASDAQ–2021–69) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

To Include Juneteenth National Independence Day 

as a Holiday). The Exchange’s General 3 rules 

incorporate by reference The Nasdaq Stock Market 

LLC’s General 3 Rules. Rule 1030 of General 3 

memorialized all current Exchange holidays and 

added a provision to permit the Exchange the 

authority to halt or suspend trading or close 

Exchange facilities for certain unanticipated 

closures. 

12 15 U.S.C. 78f(b). 

13 15 U.S.C. 78f(b)(5). 

Exchange Review Council panel shall 

review the facts and render a decision 

as soon as practicable, but generally on 

the same trading day as the execution(s) 

under review. On requests for appeal 

received after 3:00 p.m. Eastern Time, a 

decision will be rendered as soon as 

practicable, but in no case later than the 

trading day following the date of the 

execution under review. Furthermore, if 

the Exchange Review Council panel 

votes to uphold the decision made 

under this Rule, the Exchange will 

assess a fee (‘‘Appeal Fee’’) of $5,000 

against the Member(s) who initiated the 

request for appeal. 

The Exchange proposes generally to 

maintain its current appeal process with 

certain adjustments to harmonize its 

process with that of its affiliate, Phlx. 

First, while Phlx similarly requires the 

parties to submit a request for review 

within thirty (30) minutes of being 

notified of the determination being 

appealed, Phlx also provides parties 

with additional time to submit their 

request if the notification occurs later in 

the trading day. In particular, if the 

notification is made after 3:30 p.m. 

Eastern Time, either party has until 9:30 

a.m. Eastern Time on the next trading 

day to submit a request for review.3

Similar to Phlx, the Exchange believes 

that this flexibility will be helpful for 

Members in submitting their appeal 

requests in a timely manner, 

particularly where notification of the 

Official’s decision was received later in 

the trading day, and therefore proposes 

to adopt this provision in Options 3, 

Section 20(k)(2). 

Second, the Exchange proposes to 

amend its provisions for when the 

Exchange Review Council panel must 

render a decision on requests for appeal 

by harmonizing to Phlx’s process. 

Specifically, the Exchange proposes in 

Options 3, Section 20(k)(2) that the 

Exchange Review Council panel shall 

review the facts and render a decision 

on the day of the transaction, or the next 

trade day in the case where a request is 

properly made after 3:30 p.m. on the 

day of the transaction or where the 

request is properly made the next trade 

day.4 The proposed language modifies 

the current process by extending the 

current cutoff time from 3:00 to 3:30 

p.m. Eastern Time for the Exchange 

Review Council panel to render a 

decision on the next trading day, and by 

accommodating situations where parties 

properly bring an appeal request on the 

next trading day. 

Third, the Exchange proposes to 

decrease the Appeal Fee from $5,000 to 

$500 to align to Phlx’s Appeal Fee.5

Non-Substantive Changes 

In Options 3, Section 20(b)(1), the 

Exchange proposes a non-substantive, 

clarifying change to replace the 

reference to ‘‘opening rotation’’ to 

‘‘Opening Process,’’ and specify that the 

Opening Process is defined in Options 

3, Section 8. The Exchange will also 

correct a punctuation error in this 

section. 

The Exchange also proposes nonsubstantive changes to replace 

references to ‘‘Market Control’’ with 

‘‘Official’’ 6 throughout Options 3, 

Section 20. At the time of adoption, the 

term Market Control referred to 

designated personnel in the Exchange’s 

market control center that were 

responsible for administering the 

provisions of the Rule.7 The Exchange 

has since updated the terminology for 

such personnel as Officials,8 and 

therefore proposes to update the old 

references accordingly.9 The Exchange 

notes that its affiliated options 

exchanges similarly reference Officials 

as the persons responsible for 

administering their obvious error 

rules.10

Lastly, the Exchange proposes nonsubstantive, conforming amendments to 

Options 3, Section 1 (Days and Hours of 

Business). The Exchange first proposes 

to amend the title from ‘‘Days and Hours 

of Business’’ to ‘‘Hours of Business.’’ 

The Exchange recently filed to establish 

General 3, Section 1030, which governs 

the days the Exchange will be open for 

business.11 At this time, the Exchange 

also proposes to amend the first 

paragraph of Options 3, Section 1 which 

provides, ‘‘The Board shall determine 

the days the Exchange shall be open for 

business (referred to as ‘‘business days’’) 

and the hours of such days during 

which transactions may be made on the 

Exchange.’’ The Exchange proposes to 

remove this sentence and instead 

provide as new paragraph (a): 

‘‘The Exchange shall be open for 

business as provided within General 3, 

Rule 1030.’’ This proposed text will 

make clear that while General 3, Section 

1030 governs the days the Exchange will 

be open for business, the remainder of 

the rule addresses the hours of 

operation of the System and specific 

products. The Exchange also proposes 

to remove paragraph (e) as holidays are 

addressed within General 3, Section 

1030. The remainder of the paragraphs 

are proposed to be re-lettered. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,12 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,13

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 and 

because it is not designed to permit 

unfair discrimination between 

customers, issuers, brokers, or dealers. 

The Exchange further believes that its 

proposal to amend the current appeal 

process to harmonize with Phlx’s appeal 

process is consistent with the Act 

because it will continue to afford 

Members with due process in 

connection with decisions made by 

Officials under Options 3, Section 20 

that the Member may feel warrants 

review. As discussed above, the 

proposal would allow either party until 

9:30 a.m. the next trading to submit a 

request for review if notification is made 

after 3:30 p.m., which the Exchange 

believes will be helpful for Members in 

submitting their appeal requests in a 

timely manner. Furthermore, the 

proposal provides the Exchange Review 

Council panel additional time and 

flexibility to render decisions on 

requests for appeal in cases where a 


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Federal Register / Vol. 87, No. 56 / Wednesday, March 23, 2022 / Notices 16527 

14 See supra note 5. 

15 See, e.g., Cboe BZX Exchange Rule 20.6(l)(5) 

and MIAX Options Exchange Rule 521(l)(2). 

16 See supra note 11. 

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

18 17 CFR 240.19b–4(f)(6). In addition, Rule 19b4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 19 17 CFR 200.30–3(a)(12). 

request is properly made after 3:30 p.m. 

on the day of the transaction or where 

the request is properly made the next 

trade day, and is designed to reduce 

administrative burden on the Exchange. 

As it relates to the Appeal Fee, the 

Exchange believes that the proposed 

reduction of the fee from $5,000 to $500 

is reasonable, equitable and not unfairly 

discriminatory because it aligns to the 

Appeal Fee assessed by its affiliates 14

and by other options exchanges,15 and 

will be applied uniformly to all 

Members. 

Ultimately, the proposed changes to 

the appeal process are intended to align 

certain time frames and the Appeal Fee 

with those of its affiliates in order to 

provide more consistent rules and 

procedures across the affiliated options 

exchanges owned by Nasdaq, Inc. 

Consistent rules and procedures, in 

turn, would simplify and streamline the 

regulatory requirements and increase 

the understanding of the Exchange’s 

operations for Members of the Exchange 

that are also members on the Exchange’s 

affiliated options exchanges. Greater 

harmonization across the affiliated 

options exchanges will result in greater 

uniformity, rules that are easier to 

follow and understand, and more 

efficient regulatory compliance, thereby 

contributing to the protection of 

investors and the public interest. As 

such, the proposed rule change would 

foster cooperation and coordination 

with persons engaged in facilitating 

transactions in securities and would 

remove impediments to and perfect the 

mechanism of a free and open market 

and a national market system. 

The Exchange further believes that the 

proposed non-substantive changes in 

Options 3, Section 20 to replace all 

instances of Market Control with 

Official, and to replace opening rotation 

with Opening Process, will add clarity, 

transparency, and consistency to the 

Exchange’s rules. Lastly, the Exchange’s 

proposal to amend Options 3, Section 1 

(Days and Hours of Business) as 

described above will bring greater 

clarity, and ensure that this Rule 

conforms to the changes made in the 

recent filing to establish General 3, 

Section 1030, which governs the days 

the Exchange will be open for 

business.16 The Exchange believes that 

market participants would benefit from 

the increased clarity, thereby reducing 

potential confusion, and ensuring that 

market participants and investors can 

more easily navigate and understand the 

Exchange’s rules. 

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 not 

necessary or appropriate in furtherance 

of the purposes of the Act. The changes 

are designed to provide greater 

harmonization among similar rules and 

processes across the Exchange’s 

affiliated options exchanges, resulting in 

more efficient regulatory compliance for 

common members. 

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 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) 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)(iii) of the Act 17 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.18

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– 

GEMX–2022–05 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–GEMX–2022–05. 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–GEMX–2022–05 and 

should be submitted on or before April 

13, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–06099 Filed 3–22–22; 8:45 am] 

BILLING CODE 8011–01–P 


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