[Federal Register Volume 82, Number 212 (Friday, November 3, 2017)]
[Notices]
[Pages 51313-51317]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-23926]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81980; File No. SR-Phlx-2017-34]


Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing 
of Amendment No. 1, and Order Granting Accelerated Approval of a 
Proposed Rule Change, as Modified by Amendment No. 1, To add an 
Exception to Phlx Rule 1000(f)(iii) for Certain Floor Broker 
Transactions and add the Snapshot Functionality to the Options Floor 
Broker Management System

October 30, 2017.

I. Introduction

    On July 18, 2017, Nasdaq PHLX LLC (``Phlx'' or ``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 add an 
exception to Phlx Rule 1000(f)(iii) to permit Floor Brokers to execute 
(1) multi-leg orders and (2) simple orders in options on Exchange Trade 
Funds (``ETFs'') that are included in the Options Penny Pilot,\3\ in 
the

[[Page 51314]]

trading crowd using ``Snapshot,'' a new functionality Phlx is proposing 
for its Floor Broker Management System (``FBMS''). The proposed rule 
change was published for comment in the Federal Register on August 1, 
2017.\4\ On September 11, 2017, the Commission extended the time period 
within which to approve the proposed rule change, disapprove the 
proposed rule change, or institute proceedings to determine whether to 
approve or disapprove the proposed rule change to October 30, 2017.\5\ 
On October 17, 2017, the Exchange filed Amendment No. 1 to the proposed 
rule change.\6\ The Commission received no comment letters on the 
proposed rule change. This order provides notice of filing of Amendment 
No. 1 and approves the proposal, as modified by Amendment No. 1, on an 
accelerated basis.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Phlx Rule 1034 (defining terms of the Options Penny 
Pilot).
    \4\ See Securities Exchange Act Release No. 81230 (July 27, 
2016), 82 FR 35858 (``Notice'').
    \5\ See Securities Exchange Act Release No. 81567, 82 FR 43432 
(September 15, 2017).
    \6\ See Amendment No. 1, dated October 17, 2017 (``Amendment No. 
1''). Amendment No. 1 updated the original filing to: (1) Reflect 
the implementation of the new Snapshot functionality prior to the 
end of the fourth quarter of 2017; (2) modify the proposal to allow 
Floor Brokers 30 seconds within which to submit a provisionally 
executed trade and Snapshot to the Trading System, rather than the 
15 seconds that was originally proposed; (3) clarify that if a 
Snapshot expires, or if the Floor Broker cancels the Snapshot or 
expects that the Trading System will reject the Snapshot, the Floor 
Broker must re-announce the order to the trading crowd, 
provisionally re-execute the order, and take a new Snapshot; (4) 
further explain how limit orders on the limit order book will 
interact with the Snapshot functionality; and (5) make conforming 
changes to Phlx Rule 1064 and Options Floor Procedure Advices and 
Order and Decorum Regulations C-2 (``Options Floor Procedure Advice 
C-2'' or ``Advice''). To promote transparency of its proposed 
amendment, when Phlx filed Amendment No. 1 with the Commission, it 
also submitted Amendment No. 1 as a comment letter to the file, 
which the Commission posted on its Web site and placed in the public 
comment file for SR-Phlx-2017-34 (available at https://www.sec.gov/comments/sr-phlx-2017-34/phlx201734-2642790-161304.pdf). The 
Exchange also posted a copy of its Amendment No. 1 on its Web site 
at http://nasdaqphlx.cchwallstreet.com/NASDAQPHLXTools/PlatformViewer.asp?selectednode=chp%5F1%5F1%5F1&manual=%2FNASDAQOMXPHLX%2Ffilings%2Fphlx%2Dfilings%2F) when it filed Amendment No.1 with 
the Commission.
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II. Description of the Proposal \7\
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    \7\ A more detailed description of the proposal appears in the 
Notice and in Amendment No. 1.
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A. Proposed Exception to Phlx Rule 1000(f)

    Currently, Phlx Rule 1000(f) requires that all Exchange options 
transactions be executed in one of the following three ways: ``(i) 
[a]utomatically by the [Trading System] pursuant to [Phlx] Rule 1080 
and other applicable options rules; (ii) by and among members in the 
Exchange's options trading crowd none of whom is a Floor Broker; or 
(iii) through the Options [FBMS] for trades involving at least one 
Floor Broker.'' \8\ Although a Floor Broker may represent orders in the 
trading crowd, a Floor Broker is not permitted to execute an order in 
the trading crowd unless one of four exceptions applies.\9\ These 
exceptions are listed in Phlx Rule 1000(f)(iii)(A)-(D) and permit a 
Floor Broker to execute orders in the trading crowd (rather than 
through FBMS) if: (A) There is a problem with the Exchange's systems; 
(B) the Floor Broker is executing the trade pursuant to Phlx Rule 1059 
(``Accommodation Transactions'') or Phlx Rule 1079 (``FLEX Index, 
Equity and Currency Options''); (C) the transaction involves a multi-
leg order with more than 15 legs; or (D) the transaction involves 
certain types of split-price orders that, due to FBMS system 
limitations, require manual calculation.\10\
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    \8\ See Phlx Rule 1000(f).
    \9\ See Phlx Rule 1000(f)(iii).
    \10\ See Phlx Rule 1000(f)(iii)(A)-(D).
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    The Exchange is proposing to add a new exception to Rule 
1000(f)(iii).\11\ Proposed Phlx Rule 1000(f)(iii)(E) would permit Floor 
Brokers to execute multi-leg orders \12\ and simple orders in options 
on ETFs that are included in the Options Penny Pilot in the trading 
crowd using ``Snapshot,'' a new functionality that Phlx is proposing to 
add to FBMS.\13\
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    \11\ See Notice, supra note 4, at 35860 n.7.
    \12\ As defined in Phlx Rule 1066(f).
    \13\ See proposed Phlx Rule 1000(f)(iii)(E).
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B. Proposed Snapshot Functionality for FBMS

    Under the proposal, Phlx would permit a Floor Broker to use the 
Snapshot functionality at the time the Floor Broker ``provisionally 
executes'' a trade in the trading crowd that involves a multi-leg order 
or a simple order in an option on an ETF that is included in the 
Options Penny Pilot.\14\ For purposes of the proposed Phlx Rule 
1000(f)(iii)(E) exception, a ``provisional execution'' would occur in 
the trading crowd when either (i) the participants to a trade reach a 
verbal agreement in the trading crowd as to the terms of the trade, or 
(ii) a Floor Broker announces a cross in accordance with Phlx Rule 
1064(a).\15\
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    \14\ See proposed Phlx Rule 1063(e)(v)(A)(1). According to the 
Exchange, due to system limitations in FBMS, Floor Brokers are not 
able to use Snapshot to execute Multi-leg Orders with more than 15 
legs. See Amendment No. 1, supra note 6, at 6 and 8.
    \15\ Phlx Rule 1064(a) allows a Floor Broker who holds orders to 
buy and to sell the same options series the opportunity to cross 
such orders, provided that he or she satisfies certain requirements.
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    According to the Exchange, Snapshot will record the time when a 
Floor Broker triggers the functionality and the prevailing market 
conditions for an options class or series,\16\ which includes all 
information required to determine compliance with priority and trade-
through requirements, including the Away Best Bid and Offer, the 
Exchange Best Bid and Offer, customer orders at the top of the Exchange 
book, and the best bid and offer of all-or-none orders.\17\ According 
to the Exchange, the market conditions captured by Snapshot will be 
derived from the same real-time market information that exists in the 
Trading System.\18\ At any given time, Phlx would only permit a Floor 
Broker to have one Snapshot outstanding across all options classes and 
series.\19\
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    \16\ A Floor Broker ``triggers'' the snapshot by pressing a 
button in the FBMS and in doing so captures the market conditions 
that exist at the time when the Floor Broker provisionally executes 
an order in the trading crowd. See Notice, supra note 4, at 35860-
61.
    \17\ See proposed Phlx Rule 1063(e)(v). See also Notice, supra 
note 4, at 35860 n.8.
    \18\ See Amendment No. 1, supra note 6, at 6-7.
    \19\ See proposed Phlx Rule 1063(e)(v)(A)(3).
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    After a Floor Broker triggers Snapshot and captures the prevailing 
market conditions, the Floor Broker will have no more than 30 seconds 
to enter the final terms of the trade into FBMS and then submit the 
provisional execution (along with the prevailing price and market 
conditions captured by Snapshot for the options class or series) to the 
Trading System.\20\ If the Floor Broker fails to submit this 
information to the Trading System by way of FBMS within 30 seconds, the 
Snapshot will automatically expire and become unavailable.\21\
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    \20\ See Amendment No. 1, supra note 6, at 8. The Exchange 
represents that in most instances, 30 seconds will provide ample 
time for Floor Brokers to enter their trades into FBMS. See id. at 
5.
    \21\ See proposed Phlx Rule 1063(e)(v)(B). See also Amendment 
No. 1, supra note 6, at 13. The Exchange represents that every time 
a Floor Broker triggers Snapshot, a record of the Snapshot will be 
created and retained for audit trail purposes regardless of whether 
the Floor Broker submits the provisional execution and Snapshot to 
the Trading System. This record is in addition to the record the 
Exchange presently creates upon initiation of an order in FBMS. 
Moreover, according to the Exchange, when a Floor Broker submits a 
trade subject to a Snapshot to the Trading System and the trade is 
thereafter reported to the consolidated tape, an additional 
execution record will be created and retained for audit trail 
purposes that will contain all of the same details as the other 
trade records. See Notice, supra note 4, at 35860 n.9.
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    After the Trading System receives the provisional execution, Phlx 
proposes that the Trading System will compare the price and terms of 
the provisional execution, as entered into FBMS by the Floor Broker, 
against the prevailing

[[Page 51315]]

market conditions captured by Snapshot for the options class or series 
to determine whether the provisional execution is consistent with 
applicable priority and trade-through rules.\22\ If the price and terms 
of the provisional execution entered into FBMS by the Floor Broker is 
consistent with the applicable priority and trade-through rules based 
on the market conditions reflected in the Snapshot, the Trading System 
would report the trade to the Consolidated Tape; \23\ if not, the 
Trading System will reject the provisional execution.\24\ The Exchange 
represents that its Trading System's automated process for verifying 
trades for priority and trade-through compliance remains unchanged.\25\
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    \22\ See proposed Phlx Rule 1063(e)(v)(C).
    \23\ See proposed Phlx Rule 1063(e)(v)(C)(1).
    \24\ See proposed Phlx Rule 1063(e)(v)(C)(2). See Notice, supra 
note 4, at 35863.
    \25\ See Notice, supra note 4, at 35863.
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    Phlx proposes that, if an order is present on the Exchange's limit 
order book that has priority at the time a Floor Broker triggers a 
Snapshot, the Trading System would not prevent the Floor Broker from 
capturing the Snapshot; however, the Trading System would reject the 
provisional execution because the order on the limit order book would 
have priority.\26\ In these circumstances, Phlx proposes that the Floor 
Broker must clear the order with priority on the limit order book, re-
announce and again provisionally execute the Floor Broker's order, and 
take a new Snapshot before submitting the new provisional execution and 
Snapshot to the Trading System for validation.\27\
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    \26\ See proposed Phlx Rule 1063(e)(v)(C)(3). See also Amendment 
No. 1, supra note 6, at 8.
    \27\ See id.
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    Phlx proposes to allow a Floor Broker to take a new Snapshot when 
the original Snapshot becomes invalid in the occasional event a 
provisional execution pursuant to Phlx Rule 1000(f)(iii)(E) does not 
result in a validated execution in the Trading System; however, the 
Floor Broker must re-expose the order to the trading crowd before 
triggering a new Snapshot. Specifically, proposed Phlx Rule 
1063(e)(v)(D) would allow a Floor Broker to obtain a new Snapshot if: 
(1) The original Snapshot expires before the Floor Broker submits the 
provisional execution to the Trading System; (2) the Trading System 
rejects a provisional execution that was subject to a Snapshot; or (3) 
the Floor Broker cancels the Snapshot by taking a new Snapshot or 
allows the original Snapshot to expire because the Floor Broker 
anticipates that the Trading System will reject a provisional 
execution.\28\ In each of these three instances, the Floor Broker must 
re-announce and provisionally re-execute the order in the trading 
crowd, and take a new Snapshot before submitting the new provisional 
execution to the Trading System.\29\
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    \28\ See Amendment No. 1, supra note 6, at 10-12 and 13. The 
Trading System would reject a provisionally executed order if, for 
example, there was an order on the limit order book with priority at 
the time the order was provisionally executed in the trading crowed 
or the provisionally executed order did not comply with applicable 
trade-through rules. See Notice, supra note 4, at 35860-61 
(providing examples of orders executed using the Snapshot 
functionality) and Amendment No. 1, supra note 6, at 10-12 
(providing examples of when a Floor Broker would be permitted to 
take a new Snapshot).
    \29\ In this instance, triggering a new Snapshot would cause a 
new 30-second Snapshot timer to begin, and the Floor Broker must 
submit the new provisionally executed trade and Snapshot to the 
Trading System before the end of that 30-second timer. See Amendment 
No. 1, supra note 6, at 10-12.
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    Phlx is proposing Phlx Rule 1063(e)(v)(A)(2), and amending Options 
Floor Procedure Advice C-2 to specify, that ``[a] Floor Broker is 
prohibited from triggering the Snapshot feature for the purpose of 
obtaining favorable priority or trade-through conditions or avoiding 
unfavorable priority or trade-through conditions.'' \30\ According to 
the Exchange, conduct that would violate this Advice includes repeated 
instances in which Floor Brokers cancel, or permit valid Snapshots to 
expire, without submitting trades subject to Snapshots to the Trading 
System for verification and reporting to the consolidated tape. 
According to the Exchange, violations would also include repeated 
instances in which a Floor Broker takes more time than is reasonably 
necessary under the circumstances to submit provisional executions to 
the Trading System that are subject to valid Snapshots.\31\ The 
Exchange notes that it expects Floor Brokers to submit a provisional 
execution that is subject to a Snapshot as quickly as possible, 
notwithstanding the existence of the 30-second time frame within which 
to do so, and notes that, in most instances, it should not require a 
full 30 seconds for a Floor Broker to submit a simple trade or a cross 
to the Trading System.\32\ The Exchange represents that its 
Surveillance Staff will monitor Floor Brokers' use of the Snapshot 
functionality and the Exchange will take appropriate action if it 
determines Floor Brokers are abusing the functionality.\33\
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    \30\ See proposed Phlx Rule 1063(e)(v)(A)(2) and Options Floor 
Procedure Advice C-2.
    \31\ See Amendment No. 1, supra note 6, at 9 and 12.
    \32\ See id. at 9.
    \33\ See Notice, supra note 4, at 35860. See Amendment No. 1, 
supra note 6, at 9 and 12.
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    The Exchange proposes to make the Snapshot functionality available 
to its Floor Brokers during the fourth quarter of 2017. The Exchange 
represents that it will notify members via an Options Trader Alert, 
which will be posted on the Exchange's Web site, at least seven 
calendar days prior to the date on which the Snapshot functionality 
will be available for use.\34\
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    \34\ See Amendment No. 1, supra note 6, at 12.
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III. Discussion and Commission Findings

    After careful review, the Commission finds that the proposed rule 
change, as modified by Amendment No. 1, is consistent with the 
requirements of the Act and the rules and regulations thereunder 
applicable to a national securities exchange.\35\ In particular, the 
Commission finds that the proposed rule change is consistent with 
Section 6(b)(5) of the Act,\36\ which requires, among other things, 
that the rules of a national securities exchange be designed 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 and, in general, to protect investors and the public 
interest, and not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
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    \35\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. See 15 U.S.C. 78c(f).
    \36\ 15 U.S.C. 78f(b)(5).
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    The Commission notes that the Exchange's rules require Floor 
Brokers to execute transactions through FBMS and prohibit Floor Brokers 
from executing orders in the trading crowd unless an exception 
applies.\37\ According to the Exchange, however, transactions involving 
multi-leg orders and simple orders in options on ETFs in the Options 
Penny Pilot that a Floor Broker submits through FBMS are at a 
heightened risk of failing to execute when market conditions change 
between the time when Floor Brokers and participants in the crowd agree 
upon the terms of the trade and the time when the Trading System 
receives the trade for verification and execution. In these 
circumstances, the Trading System would reject the Floor Broker's trade 
because it is inconsistent with the Exchange's priority or trade-
through rules.\38\ To mitigate this risk, the new exception under Phlx 
Rule 1000(f)(iii)(E) is designed to permit Floor Brokers to use the 
Snapshot

[[Page 51316]]

functionality to execute two types of orders in the trading crowd that 
they may not otherwise be able to execute successfully under certain 
market conditions given the requirements of Phlx Rule 1000(f).
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    \37\ See Phlx Rule 1000(f).
    \38\ See Notice, supra note 4, at 35859.
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    The Commission notes that the Exchange is proposing several 
measures to help ensure that Snapshot operates, and is used by Floor 
Brokers, in a manner that is consistent with the Exchange Act and Phlx 
rules.
    First, Snapshot is designed to capture the market conditions for 
the options class or series at the time of the provisional execution, 
which will be the time of execution that the Trading System will use 
when verifying the price and terms of the provisional execution, as 
entered into FBMS by the Floor Broker, for compliance with applicable 
priority rules of the Exchange and the trade-through rules of the 
Options Order Protection and Locked/Crossed Market Plan.\39\
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    \39\ See Notice, supra note 4, at 35862-63. The Options Order 
Protection and Locked/Crossed Market Plan is available at http://www.optionsclearing.com/components/docs/clearing/services/options_order_protection_plan.pdf. The Commission notes that the 
Exchange represents that the market conditions provided by Snapshot 
are derived from the same real-time market conditions that exist in 
the Trading System and that Snapshot will contain all information 
necessary for the Trading System to determine that a provisional 
execution is consistent with applicable priority and trade-through 
rules. See Amendment No. 1, supra note 6, at 6-7.
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    Second, the Exchange has designed Snapshot so that the price and 
market conditions captured for the options class or series will expire 
within 30 seconds after the Floor Broker triggers it, and so that a 
Floor Broker will only be allowed to have one Snapshot outstanding 
across all options classes and series at any given time.\40\ As stated 
above, the Exchange anticipates that Floor Brokers will enter their 
provisional executions as quickly as possible, notwithstanding the 
availability of Snapshot and the 30-second Snapshot timer, and in most 
instances, 30 seconds will provide ample time for Floor Brokers to 
enter provisional executions into FBMS.\41\
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    \40\ See Notice, supra note 4, at 35861. The Exchange notes that 
the limitation to only allow Floor Brokers to have one Snapshot 
outstanding at any given time across options classes and series 
should contribute to preventing Floor Brokers from engaging in 
excessive use of and abuse of Snapshot. See Notice, supra note 4, at 
35861.
    \41\ See Amendment No. 1, supra note 6, at 5 and 7.
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    Third, to the extent that a Snapshot expires, the Trading System 
rejects a provisional execution, or the Floor Broker cancels or permits 
a Snapshot to expire, the Floor Broker must re-announce and 
provisionally execute the order again in the trading crowd before 
taking a new Snapshot.
    Fourth, the Exchange represents that all relevant trade data 
resulting from executions pursuant to proposed Phlx Rule 
1000(f)(iii)(E) will be recorded in both Snapshot and on a separate 
execution record, which will be created once the trade is reported to 
the consolidated tape.\42\
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    \42\ See Notice, supra note 4, at 35860 n.9. See also supra note 
21.
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    Finally, the Commission notes that the Exchange's rule will 
prohibit Floor Brokers from triggering Snapshot for the purpose of 
obtaining favorable, or avoiding unfavorable, priority or trade-through 
conditions. In addition, the Exchange represents that its surveillance 
staff will monitor Floor Brokers for excessive use or abuse for the 
Snapshot functionality (e.g., repeated expirations or cancellations of 
the Snapshot) and it will take appropriate action if it determines such 
instances are occurring.\43\
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    \43\ See Amendment No. 1, supra note 6, at 9 and 12.
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    For the foregoing reasons, the Commission finds that the proposed 
rule change, as modified by Amendment No. 1, is consistent with Section 
6(b)(5) of the Act and the rules and regulations thereunder applicable 
to national securities exchanges.

IV. Solicitation of Comments on Amendment No. 1 to the Proposed Rule 
Change

    Interested persons are invited to submit written data, views, and 
arguments concerning whether Amendment No. 1 to the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

    <bullet> Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#3c4e495059115f5351515952484f7c4f595f125b534a"><span class="__cf_email__" data-cfemail="7c0e091019511f1311111912080f3c0f191f521b130a">[email protected]</span></a>. Please include 
File No. SR-Phlx-2017-34 on the subject line.

Paper Comments

    <bullet> 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 No. SR-Phlx-2017-34. 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 Web site (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 Web site 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 such filing will also 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 No. SR-Phlx-2017-34 and should be 
submitted on or before November 24, 2017.

V. Accelerated Approval of Proposed Rule Change, as Modified by 
Amendment No. 1

    The Commission finds good cause to approve the proposed rule 
change, as modified by Amendment No. 1, prior to the thirtieth day 
after the date of publication of notice of the amended proposal in the 
Federal Register. As described above, in Amendment No. 1, Phlx (1) 
updated its proposal to state that the new Snapshot functionality will 
be made available prior to the end of the fourth quarter of 2017; (2) 
modified the proposal to allow Floor Brokers 30 seconds within which to 
submit a provisionally executed trade and Snapshot to the Trading 
System, rather than the 15 seconds that was originally proposed; (3) 
further explained how limit orders on the limit order book will 
interact with the Snapshot functionality; (4) clarified the 
circumstances when a new Snapshot may be taken and the conditions for 
doing so; and (5) made conforming changes to Phlx Rule 1064 and Options 
Floor Procedure Advice C-2.\44\ The Commission believes that Amendment 
No. 1 provided additional specificity regarding the new proposed 
exception in Phlx Rule 1000(f)(iii) and the operation of the Snapshot 
functionality. Specifically, Amendment

[[Page 51317]]

No. 1 eliminated the concept of ``refreshing'' a Snapshot and instead 
clarified the specific circumstances in which a Floor Broker will be 
permitted to take a new Snapshot and the conditions that must be 
satisfied to do so (e.g., re-announcing the order to the trading crowd 
and provisionally re-executing the order). The Exchange states that the 
changes in Amendment No. 1 simplify the proposal and will make it 
easier for the Exchange to administer and surveil the use of the 
Snapshot functionality.\45\ In addition, the Commission notes that the 
changes may create additional opportunities for orders to interact in 
the trading crowd in those occasional instances when a provisional 
execution pursuant to Phlx Rule 1000(f)(iii)(E) does not result in a 
validated execution in the Trading System. Accordingly, the Commission 
finds good cause, pursuant to Section 19(b)(2) of the Act,\46\ to 
approve the proposed rule change, as modified by Amendment No. 1, on an 
accelerated basis.
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    \44\ See Amendment No. 1, supra note 6, at 3-7.
    \45\ See id. at 5-6.
    \46\ 15 U.S.C. 78s(b)(2)
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VI. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\47\ that the proposed rule change (SR-Phlx-2017-34), as modified 
by Amendment No. 1, be, and it hereby is, approved on an accelerated 
basis.
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    \47\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\48\
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    \48\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-23926 Filed 11-2-17; 8:45 am]
BILLING CODE 8011-01-P


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