Federal Register / Vol. 86, No. 109 / Wednesday, June 9, 2021 / Notices 30661 

22The number of new unregistered money market 

funds is estimated from 2018–2019 historical Form 

PF filings by liquidity fund advisers. See Securities 

and Exchange Commission’s Division of Investment 

Management—Analytics Office Private Funds 

Statistics, Fourth Calendar Quarter (Oct. 2, 2020) 

available at https://www.sec.gov/divisions/ 

investment/private-funds-statistics/private-fundsstatistics-2019-q4.pdf. 

23We recognize that in many cases the adviser to 

an unregistered money market fund typically 

performs the function of the fund’s board. Money 

Market Fund Reform; Amendments to Form PF 

Investment Company Act Rel. No. 31166 (Jul. 23, 

2014), 79 FR 47735, 47809 (Aug. 14, 2014). 

24For purposes of this PRA extension, we 

assumed that on average 25% (41 funds × .25 = 

approximately 10 funds) of liquidity funds would 

review and update their procedures on annual 

basis. 

25This number has been derived from the number 

of advisers to liquidity funds. See U.S. Securities 

and Exchange Commission, Division of Investment 

Management, Analytics Office, Private Fund 

Statistics, Fourth Quarter 2019 (Oct. 2, 2020), Table 

2. 

26See supra note 23. 

27There are no liquidity funds of this type; 

liquidity funds only are offered to qualified 

investors. 

28See supra note 23. 

29 Id. 

30 Id. 

31 In the context of registered money market 

funds, we have previously estimated an average of 

approximately 2 occurrences for 20 funds each year; 

however, this number may vary significantly in any 

particular year. For purposes of this PRA extension, 

we assumed there would be same proportion of 

unregistered money market funds experiencing 

events of default or solvency each year. (20/433 

registered money market funds = approximately 

5%. 5% × 41 liquidity funds = approximately 2 

liquidity funds.) 

32See U.S Securities and Exchange Commission, 

Division of Investment Management, Analytics 

Office, Private Fund Statistics, Fourth Quarter 2019 

(Oct. 2, 2020), Table 3. 

33The recordkeeping cost estimates are 

$0.0051295 per dollar of assets under management 

for small funds, and $0.0005041 per dollar of assets 

under management for medium-sized funds. The 

cost estimates are the same as those used in the 

most recently approved rule 2a–7 submission. 

34This estimate is based on the following 

calculation: ($294 billion × $0.0000009) = $264,600 

for large funds. 

35This estimate is based on the following 

calculation: ($294 billion × 0.0000132) = $3.88 

million. 

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

2 17 CFR 240.19b–4. 

2 above, unregistered money market 

funds will incur costs to preserve 

records, as required under rule 2a–7. 

These costs will vary significantly for 

individual funds, depending on the 

amount of assets under fund 

management and whether the fund 

preserves its records in a storage facility 

in hard copy or has developed and 

maintains a computer system to create 

and preserve compliance records. In the 

2019 rule 2a–7 PRA extension, 

Commission staff estimated that the 

amount an individual money market 

fund may spend ranges from $100 per 

year to $300,000. We have no reason to 

believe the range is different for 

unregistered money market funds. 

Based on Form PF data as of the fourth 

calendar quarter 2019, liquidity funds 

have $294 billion in gross asset value.32

The Commission does not have specific 

information about the proportion of 

assets held in small, medium-sized, or 

large unregistered money market funds. 

Because liquidity funds are often used 

as cash management vehicles, the staff 

estimates that each private liquidity 

fund is a ‘‘large’’ fund (i.e., more than 

$1 billion in assets under management). 

Based on a cost of $0.0000009 per dollar 

of assets under management (for large 

funds),33 the staff estimates compliance 

with rule 2a–7 for these unregistered 

money market funds totals $264,600 

annually.34

Consistent with estimates made in the 

rule 2a–7 submission, Commission staff 

estimates that unregistered money 

market funds also incur capital costs to 

create computer programs for 

maintaining and preserving compliance 

records for rule 2a–7 of $0.0000132 per 

dollar of assets under management. 

Based on the assets under management 

figures described above, staff estimates 

annual capital costs for all unregistered 

money market funds of $3.88 million.35

Commission staff further estimates 

that, even absent the requirements of 

rule 2a–7, money market funds would 

spend at least half of the amounts 

described above for record preservation 

($132,300) and for capital costs ($1.94 

million). Commission staff concludes 

that the aggregate annual costs of 

compliance with the rule are $132,300 

for record preservation and $1.94 

million for capital costs. 

The collections of information 

required for unregistered money market 

funds by rule 12d1–1 are necessary in 

order for acquiring funds to able to 

obtain the benefits described above. 

Notices to the Commission will not be 

kept confidential. An agency may not 

conduct or sponsor, and a person is not 

required to respond to, a collection of 

information unless it displays a 

currently valid control OMB number. 

The public may view background 

documentation for this information 

collection at the following website: 

www.reginfo.gov. Find this particular 

information collection by selecting 

‘‘Currently under 30-day Review—Open 

for Public Comments’’ or by using the 

search function. Written comments and 

recommendations for the proposed 

information collection should be sent 

within 30 days of publication of this 

notice to (i) >www.reginfo.gov/public/ 

do/PRAMain< and (ii) David Bottom, 

Director/Chief Information Officer, 

Securities and Exchange Commission, 

c/o Cynthia Roscoe, 100 F Street NE, 

Washington, DC 20549, or by sending an 

email to: PRA_Mailbox@sec.gov. 

Dated: June 4, 2021. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–12104 Filed 6–8–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92103; File No. SR–BX– 

2021–025] 

Self-Regulatory Organizations; Nasdaq 

BX, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend BX Options 7, 

Section 1, ‘‘General Provisions’’ and 

Section 2, ‘‘BX Options Market-Fees 

and Rebates’’ 

June 3, 2021. 

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 May 24, 

2021, Nasdaq BX, Inc. (‘‘BX’’ or 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘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 BX 

Options 7, Section 1, ‘‘General 

Provisions’’ and Section 2, ‘‘BX Options 

Market-Fees and Rebates.’’ 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/bx/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 


lotter on DSK11XQN23PROD with NOTICES1
30662 Federal Register / Vol. 86, No. 109 / Wednesday, June 9, 2021 / Notices 

3 The Block Order Mechanism is for single leg 

transactions only. Block Orders are orders for fifty 

(50) contracts or more. See Securities Release Act 

No. 89759 (September 3, 2020), 85 FR 55877 

(September 3, 2020) [sic] (SR–BX–2020–023). 

4 See Options Technical Update #2021–2. 

5 A Customer Cross Order is an order type within 

Options 3, Section 7(a)(10). A Customer Cross Order 

is comprised of two Public Customer Orders 

automatically executed upon entry provided that 

the execution is at or between the best bid and offer 

on the Exchange and (i) is not at the same price as 

a Public Customer Order on the Exchange’s limit 

order book and (ii) will not trade through the 

NBBO. See Securities Release Act No. 89476 

(August 4, 2020), 85 FR 48274 (August 10, 2020) 

(SR–BX–2020–017). 

6 15 U.S.C. 78 f(b). 

7 15 U.S.C. 78f(b)(4) and (5). 

8 NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. 

Cir. 2010) (quoting Securities Exchange Act Release 

No. 59039 (December 2, 2008), 73 FR 74770, 74782– 

83 (December 9, 2008) (SR–NYSEArca–2006–21)). 

9 See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) 

(‘‘Regulation NMS Adopting Release’’). 

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 

BX’s Pricing Schedule at BX Options 7, 

Section 1, ‘‘General Provisions’’ and 

Section 2, ‘‘BX Options Market-Fees and 

Rebates.’’ Each change will be described 

below. 

Options 7, Section 1 

The Exchange proposes to relocate 

rule text, without change, related to the 

Removal of Days for Purposes of Pricing 

Tiers within Options 7, Section 2(6) into 

Options 7, Section 1, General 

Provisions. This proposed change is 

non-substantive. The Exchange believes 

that this rule text is more appropriate 

for Section 1 which describes general 

provisions. 

Options 7, Section 2 

The Exchange will begin offering its 

Block Order Mechanism 3 and Customer 

Cross Order 4 on June 1, 2021.5 The 

Exchange proposes to assess no fees and 

pay no rebates for orders entered into 

the Block Order Mechanism or 

Customer Cross Orders. Specifically, the 

Exchange proposes to create a header 

within Options 7, Section 2(6) [sic] 

which states, ‘‘Block Order Mechanism 

per Options 3, Section 11 and Customer 

Cross Orders per to Options 3, Section 

12’’ and note that ‘‘Orders executed in 

the Block Order Mechanism and 

Customer Cross Orders are not subject to 

fees or rebates.’’ 

Also, the Exchange proposes to 

amend the rule text within Options 7, 

Section 2(1), which directs Participants 

to applicable pricing, to also provide 

that ‘‘Orders executed in the Block 

Order Mechanism and Customer Cross 

Orders are not subject to the pricing in 

Options 7, Section 2(1), instead, these 

orders are subject to the pricing within 

Options 7, Section 2(6).’’ The addition 

of this rule text will serve as a guidepost 

to Participants to easily locate the 

pricing for the Block Order Mechanism. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,6 in general, and furthers the 

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

of the Act,7 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 any facility, and is not 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

The proposed changes to BX’s Pricing 

Schedule are reasonable in several 

respects. As a threshold matter, the 

Exchange is subject to significant 

competitive forces in the market for 

options securities transaction services 

that constrain its pricing determinations 

in that market. The fact that this market 

is competitive has long been recognized 

by the courts. In NetCoalition v. 

Securities and Exchange Commission, 

the D.C. Circuit stated as follows: ‘‘[n]o 

one disputes that competition for order 

flow is ‘fierce.’ . . . As the SEC 

explained, ‘[i]n the U.S. national market 

system, buyers and sellers of securities, 

and the broker-dealers that act as their 

order-routing agents, have a wide range 

of choices of where to route orders for 

execution’; [and] ‘no exchange can 

afford to take its market share 

percentages for granted’ because ‘no 

exchange possesses a monopoly, 

regulatory or otherwise, in the execution 

of order flow from broker 

dealers’. . . .’’ 8

The Commission and the courts have 

repeatedly expressed their preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, while 

adopting a series of steps to improve the 

current market model, the Commission 

highlighted the importance of market 

forces in determining prices and SRO 

revenues and, also, recognized that 

current regulation of the market system 

‘‘has been remarkably successful in 

promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 9

Numerous indicia demonstrate the 

competitive nature of this market. For 

example, clear substitutes to the 

Exchange exist in the market for options 

security transaction services. The 

Exchange is only one of sixteen options 

exchanges to which market participants 

may direct their order flow. Within this 

environment, market participants can 

freely and often do shift their order flow 

among the Exchange and competing 

venues in response to changes in their 

respective pricing schedules. As such, 

the proposal represents a reasonable 

attempt by the Exchange to increase its 

liquidity and market share relative to its 

competitors. 

Options 7, Section 1 

The Exchange’s proposal to relocate 

rule text related to the Removal of Days 

for Purposes of Pricing Tiers within 

Options 7, Section 2(6) into Options 7, 

Section 1, General Provisions, without 

change, is reasonable as the Exchange is 

simply relocating the rule text within a 

section which describes general 

provisions. 

The Exchange’s proposal to relocate 

rule text related to the Removal of Days 

for Purposes of Pricing Tiers within 

Options 7, Section 2(6) into Options 7, 

Section 1, General Provisions, without 

change, is equitable and not unfairly 

discriminatory as the rule text will 

continue to apply uniformly to all 

Participants. 

Options 7, Section 2 

The Exchange’s proposal to adopt 

Block Order Mechanism and Customer 

Cross Order pricing is reasonable. On 

June 1, 2021, the Exchange will begin 

offering the Block Order Mechanism 

and Customer Cross Orders to 

Participants and assess no fees and not 

pay any rebates for orders entered into 

the Block Order Mechanism or 

Customer Cross Orders. The Exchange’s 

proposal will provide Participants 

notification of its Block Order and 

Customer Cross Order pricing. The 

proposal to add rule text within 

Options 7, Section 2(1) will serve as a 

guidepost to Participants to easily locate 

the pricing for the Block Order 

Mechanism and Customer Cross Orders. 

The Exchange’s proposal to adopt 

Block Order Mechanism and Customer 

Cross Order pricing is equitable and not 

unfairly discriminatory as no 

Participant would be subject to any fees 

or be paid any rebates for orders 

executed into the Block Order 

Mechanism or Customer Cross Orders. 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 86, No. 109 / Wednesday, June 9, 2021 / Notices 30663 

10 15 U.S.C. 78s(b)(3)(A)(ii). 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Exchange Act Release No. 90067 (October 1, 

2020), 85 FR 63314 (‘‘Notice’’). Comments on the 

proposed rule change can be found at: https:// 

Continued 

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. 

Inter-Market Competition 

The proposal does not impose an 

undue burden on inter-market 

competition. The Exchange believes its 

proposal remains competitive with 

other options markets and will offer 

market participants with another choice 

of where to transact options. The 

Exchange notes that it operates in a 

highly competitive market in which 

market participants can readily favor 

competing venues if they deem fee 

levels at a particular venue to be 

excessive, or rebate opportunities 

available at other venues to be more 

favorable. In such an environment, the 

Exchange must continually adjust its 

fees to remain competitive with other 

options exchanges. Because competitors 

are free to modify their own fees in 

response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

believes that the degree to which fee 

changes in this market may impose any 

burden on competition is extremely 

limited. 

Intra-Market Competition 

Options 7, Section 1 

The Exchange’s proposal to relocate 

rule text related to the Removal of Days 

for Purposes of Pricing Tiers within 

Options 7, Section 2(6) into Options 7, 

Section 1, General Provisions, without 

change, does not impose an undue 

burden on competition as the rule text 

will continue to apply uniformly to all 

Participants. 

Options 7, Section 2 

The Exchange’s proposal to adopt 

Block Order Mechanism and Customer 

Cross Order pricing does not impose an 

undue burden on competition as no 

Participant would be subject to any fees 

or be paid any rebates for orders 

executed into the Block Order 

Mechanism or Customer Cross Orders. 

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.10 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– 

BX–2021–025 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–BX–2021–025. 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; 

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–BX–2021–025 and should 

be submitted on or before June 30, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

J. Matthew DeLesDernier,

Assistant Secretary. 

[FR Doc. 2021–12032 Filed 6–8–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92105; File No. SR–FINRA– 

2020–031] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Order Granting 

Approval of a Proposed Rule Change, 

as Modified by Amendment No. 2, To 

Adopt Proposed Rule 6439 

(Requirements for Member Inter-Dealer 

Quotation Systems) and Rescind the 

Rules Related to the OTC Bulletin 

Board Service 

June 3, 2021. 

I. Introduction

On September 24, 2020, the Financial

Industry Regulatory Authority, Inc. 

(‘‘FINRA’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’), 

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

Securities Exchange Act of 1934 (‘‘Act’’ 

or ‘‘Exchange Act’’) 1 and Rule 19b–4 

thereunder,2 a proposed rule change to 

rescind the rules related to the OTC 

Bulletin Board Service and cease its 

operation and to adopt new 

requirements for member inter-dealer 

quotation systems that disseminate 

quotations in equity securities traded 

over-the-counter (‘‘OTC’’). The proposed 

rule change was published for comment 

in the Federal Register on October 7, 

2020.3 On November 4, 2020, pursuant 


lotter on DSK11XQN23PROD with NOTICES1