52702 Federal Register / Vol. 86, No. 181 / Wednesday, September 22, 2021 / Notices 

18 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4For purposes of this filing, Market Makers 

include Lead Market Makers, Streaming Quote 

Traders, and Remote Streaming Quote Traders. See 

Options 1, Section 1(b)(28). 

5Today, Market Makers can log into an interface 

to send a message to the Exchange to initiate the 

Kill Switch. 

6For purposes of this filing, the term ‘‘System’’ 

shall mean the automated system for order 

execution and trade reporting owned and operated 

by the Exchange. See Options 1, Section 1(b)(57). 

7 Identifiers include Exchange accounts, ports, 

and/or badges or mnemonics. Thus, a Market Maker 

using Kill Switch may elect to remove quotes for 

an individual Identifier (e.g., badge) or any group 

of Identifiers (e.g., all badges within one Market 

Maker firm). Permissible groups must reside within 

a single member firm. 

8See Options 3, Section 17. The Kill Switch tool 

also currently allows Phlx members to cancel open 

orders and prevent new order submission. The 

Exchange is not proposing to decommission the 

order cancellation portion of the Kill Switch tool at 

this time. 

9No Market Makers have used the Kill Switch for 

quote removal in 2021. 

10See Options Trader Alert #2021–49. 

11 ‘‘SQF’’ is an interface that allows Lead Market 

Makers, Streaming Quote Traders (‘‘SQTs’’) and 

Remote Streaming Quote Traders (‘‘RSQTs’’) to 

connect, send, and receive messages related to 

quotes, Immediate-or-Cancel Orders, and auction 

responses into and from the Exchange. Features 

include the following: (1) Options symbol directory 

messages (e.g., underlying and complex 

instruments); (2) system event messages (e.g., start 

of trading hours messages and start of opening); (3) 

trading action messages (e.g., halts and resumes); (4) 

execution messages; (5) quote messages; (6) 

Immediate-or-Cancel Order messages; (7) risk 

protection triggers and purge notifications; (8) 

opening imbalance messages; (9) auction 

notifications; and (10) auction responses. The SQF 

Purge Interface only receives and notifies of purge 

requests from the Lead Market Maker, SQT or 

RSQT. Lead Market Makers, SQTs and RSQTs may 

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–ISE–2021–19 and should be 

submitted on or before October 13, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.18

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–20449 Filed 9–21–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–93015; File No. SR–Phlx– 

2021–51] 

Self-Regulatory Organizations; Nasdaq 

PHLX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend Options 3, 

Section 17, To Decommission the 

Exchange’s Quote Removal Kill Switch 

Functionality 

September 16, 2021. 

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

Securities Exchange Act of 1934 

(‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on 

September 2, 2021, Nasdaq PHLX LLC 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

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 

decommission the Exchange’s quote 

removal Kill Switch functionality at 

Options 3, Section 17. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/phlx/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 amend 

Options 3, Section 17 to decommission 

the Exchange’s quote removal Kill 

Switch functionality, which is an 

optional tool that allows Market 

Makers 4 to initiate a message (or 

messages) 5 to the System 6 to promptly 

remove their quotes from the market. 

Market Makers may submit a request to 

the System to remove quotes based on 

certain identifier(s) on either a user or 

group level (‘‘Identifier’’).7 If quotes are 

cancelled by the Market Maker using 

Kill Switch, it will result in the removal 

of all quotes requested for the 

Identifier(s). The Market Maker will be 

unable to enter any additional quotes for 

the affected Identifier(s) until the 

Market Maker sends a re-entry request 

to the Exchange.8

Due to the lack of demand for the 

quote removal Kill Switch by Market 

Makers, the Exchange proposes to 

decommission this optional tool by the 

end of Q4 2021.9 Through consultation 

with individual Market Maker firms 

prior to filing this rule change, the 

Exchange did not receive any negative 

feedback for its proposal to 

decommission the quote removal Kill 

Switch functionality. The Exchange has 

also provided all market participants 

with advance notice that it will 

decommission this functionality in Q4 

2021.10 With the proposed changes, the 

Exchange seeks to streamline its product 

offerings and to reallocate Exchange 

resources to other business and risk 

management initiatives. While the 

Exchange will no longer offer this 

optional functionality to Market Makers, 

it will continue to offer similar quote 

management tools that would assist 

Market Makers with their efforts to 

manage their risk with respect to quotes 

on the Exchange. For example, Market 

Makers are currently able to send a mass 

purge request through Specialized 

Quote Feed (‘‘SQF’’) to pull their 

existing quotes from the market and 

inhibit the entry of new quotes until the 

Market Maker sends a message to the 

Exchange to re-enter the System.11

Federal Register / Vol. 86, No. 181 / Wednesday, September 22, 2021 / Notices 52703 

only enter interest into SQF in their assigned 

options series. See Options 3, Section 7(a)(i)(B). 

12See Options 3, Section 19. 

13The rapid fire risk controls automatically 

remove Market Maker quotes submitted over SQF 

when certain firm-set thresholds are met. Once the 

thresholds are triggered, the Market Maker must 

send a re-entry indicator to re-enter the System. See 

Options 3, Section 15(c)(2). 

14When the SQF Port detects the loss of 

communication with a member’s Client Application 

because the Exchange’s server does not receive a 

Heartbeat message for a certain time period (‘‘nn’’ 

seconds), the Exchange will automatically logoff the 

member’s affected Client Application and 

automatically cancel all of the member’s open 

quotes. Quotes will be cancelled across all Client 

Applications that are associated with the same Lead 

Market Maker or Market Maker (collectively 

‘‘Market Maker’’) ID and underlying issues. See 

Options 3, Section 18(a). 

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

16 15 U.S.C. 78f(b)(5). 

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

18 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(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. 

Indeed, the Exchange has found that 

Market Makers utilize this SQF purge 

functionality instead of the Kill Switch 

quote removal tool when they want to 

remove their quotes from the market. 

In addition, all Phlx members, 

including Market Makers, may contact 

the Exchange’s market operations staff 

to request that the Exchange cancel any 

of their existing bids, offers, or orders in 

any series of options.12 Furthermore, the 

Exchange will continue to have 

mandatory System-enforced risk 

mechanisms that automatically remove 

quotes for the Market Maker once 

certain pre-set thresholds or conditions 

are met. This includes risk protections 

such as rapid fire risk controls 13 and 

cancel on disconnect.14

To effect the decommissioning of the 

quote removal Kill Switch, the 

Exchange proposes to amend Options 3, 

Section 17 by eliminating all references 

to quote removal within this Rule. In 

connection with this change, the 

Exchange will also renumber current 

Options 3, Section 17(a)(2) and (a)(3) as 

Options 3, Section 17(a)(1) and (a)(2), 

respectively. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,15 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,16

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. 

Additionally, the Exchange believes that 

the proposed rule change is consistent 

with the Section 6(b)(5) requirement 

that the rules of an exchange not be 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

Specifically, the Exchange does not 

believe that the proposed rule change 

will affect the protection of investors or 

the public interest or the maintenance of 

a fair and orderly market because no 

Market Makers have used the quote 

removal Kill Switch risk control in 

2021. In addition, the Exchange notes 

that the use of this tool is completely 

optional, and the Exchange will 

continue to offer Market Makers similar 

risk management tools such as the SQF 

mass quote purge functionality. As 

discussed above, the Exchange has 

found that Market Makers use the SQF 

purge functionality much more 

frequently than the quote removal Kill 

Switch to pull their quotes from the 

market. Furthermore, Market Makers 

will retain the ability to contact market 

operations staff to manually purge their 

quotes from the market. In addition, the 

Exchange will continue to implement 

mandatory System-enforced risk 

mechanisms that automatically remove 

quotes for the Market Maker once 

certain pre-set thresholds or conditions 

are met (i.e., rapid fire and cancel on 

disconnect). 

Also, the Exchange believes that the 

low usage rate for the quote removal Kill 

Switch does not warrant the continuous 

resources necessary for System support 

of such tools. As a result, the Exchange 

also believes that the proposal will 

remove impediments to and perfect the 

mechanism of a free and open market 

and a national market system by 

allowing the Exchange to reallocate 

System capacity and resources currently 

used to maintain this functionality to 

the development and maintenance of 

other business initiatives and risk 

management products. 

As noted above, the Exchange will 

retain the ability for Phlx members to 

utilize Kill Switch to cancel orders and 

prevent new order submission. The 

Exchange does not believe that 

decommissioning the quote removal 

portion of the Kill Switch tool for 

Market Makers is unfairly 

discriminatory because Market Makers 

are professional traders with their own 

risk settings, and have more 

sophisticated infrastructures than most 

other market participants. Furthermore, 

as discussed above, the Exchange has 

determined that Market Makers 

currently use the mass purge 

functionality on SQF to pull their 

quotes from the market instead of using 

the quote removal Kill Switch tool to 

achieve the same result. 

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 

proposed rule change will allow the 

Exchange to decommission a risk 

management tool that is rarely, if ever, 

used on the Exchange. As discussed 

above, Market Makers currently have a 

variety of similar tools like the quote 

removal Kill Switch that allow them to 

pull their quotes from the market and 

inhibit the entry of new quotes, 

including the mass quote purge 

functionality on SQF that the Exchange 

has found Market Makers use much 

more frequently than the quote removal 

Kill Switch to achieve the same result. 

As noted above, the Exchange will 

retain the ability for Phlx members to 

utilize Kill Switch to cancel orders and 

prevent new order submission. The 

Exchange does not believe that 

decommissioning the quote removal 

portion of the Kill Switch tool for 

Market Makers will impose an undue 

burden on competition because Market 

Makers are professional traders with 

their own risk settings, and have more 

sophisticated infrastructures than most 

other market participants. 

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) of the Act 17 and Rule 19b– 

4(f)(6) 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 

52704 Federal Register / Vol. 86, No. 181 / Wednesday, September 22, 2021 / Notices 

19 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. 92545 

(August 2, 2021), 86 FR 43279 (August 6, 2021). 

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

5 Id. 

6 17 CFR 200.30–3(a)(31). 

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. 

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– 

Phlx–2021–51 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–Phlx–2021–51. 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–Phlx–2021–51 and should 

be submitted on or before October 13, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–20447 Filed 9–21–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–93024; File No. SR– 

PEARL–2021–35] 

Self-Regulatory Organizations; MIAX 

PEARL, LLC; Notice of Designation of 

a Longer Period for Commission 

Action on a Proposed Rule Change To 

Amend Exchange Rule 2616, Priority of 

Orders 

September 16, 2021. 

On July 20, 2021, MIAX PEARL, LLC 

(‘‘Exchange’’) 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 

amend Exchange Rule 2616, Priority of 

Orders, to provide that an order will 

receive a new timestamp when its 

position is modified via a Cancel/ 

Replace message during a Short Sale 

Period. The proposed rule change was 

published for comment in the Federal 

Register on August 6, 2021.3 The 

Commission has not received any 

comment letters on the proposed rule 

change. 

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

that, within 45 days of the publication 

of notice of the filing of a proposed rule 

change, or within such longer period up 

to 90 days as the Commission may 

designate if it finds such longer period 

to be appropriate and publishes its 

reasons for so finding or as to which the 

self-regulatory organization consents, 

the Commission shall either approve the 

proposed rule change, disapprove the 

proposed rule change, or institute 

proceedings to determine whether the 

proposed rule change should be 

disapproved. The 45th day after 

publication of the notice for this 

proposed rule change is September 20, 

2021. 

The Commission is extending the 45- 

day time period for Commission action 

on the proposed rule change. The 

Commission finds that it is appropriate 

to designate a longer period within 

which to take action on the proposed 

rule change so that it has sufficient time 

to consider the proposed rule change. 

Accordingly, pursuant to Section 

19(b)(2) of the Act,5 the Commission 

designates November 4, 2021, as the 

date by which the Commission shall 

either approve or disapprove, or 

institute proceedings to determine 

whether to disapprove, the proposed 

rule change (File No. SR–PEARL–2021– 

35). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.6

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–20451 Filed 9–21–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–450, OMB Control No. 

3235–0505] 

Submission for OMB Review; 

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: 

Rule 303 of Regulation ATS 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the 

Securities and Exchange Commission 

(‘‘Commission’’) has submitted to the 

Office of Management and Budget 

(‘‘OMB’’) a request for approval of 

extension of the previously approved 

collection of information provided for in 

Rule 303 of Regulation ATS (17 CFR 

242.303) under the Securities Exchange 

Act of 1934 (15 U.S.C. 78a et seq.) 

(‘‘Exchange Act’’). 

Regulation ATS sets forth a regulatory 

regime for ‘‘alternative trading systems’’ 

(‘‘ATSs’’), which are entities that carry 

out exchange functions but are not 

required to register as national securities 

exchanges under the Act. In lieu of 

exchange registration, an ATS can 

instead opt to register with the 

Commission as a broker-dealer and, as 

a condition to not having to register as 

an exchange, must instead comply with 

Regulation ATS. Rule 303 of Regulation 

ATS (17 CFR 242.303) describes the 

record preservation requirements for 

ATSs. Rule 303 also describes how such