Document ID: SEC-2018-0231-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Cboe EDGX Exchange, Inc.
Posted Date: 2018-02-07T05:00Z

[Federal Register Volume 83, Number 26 (Wednesday, February 7, 2018)]
[Notices]
[Pages 5493-5494]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-02397]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82615; File No. SR-CboeEDGX-2018-003]

Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change to Rule 
21.1, Definitions, To Modify a Time in Force Applicable to the 
Exchange's Equity Options Platform

February 1, 2018.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on January 25, 2018, Cboe EDGX Exchange, Inc. (the ``Exchange'' or 
``EDGX'') 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 Exchange 
has designated this proposal as a ``non-controversial'' proposed rule 
change pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-
4(f)(6)(iii) thereunder,\4\ which renders it effective upon filing with 
the Commission. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6)(iii).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend Rule 21.1 to modify a Time 
in Force applicable to the Exchange's equity options platform (``EDGX 
Options'').
    The text of the proposed rule change is available at the Exchange's 
website at www.markets.cboe.com, 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 parts 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 Exchange Rule 21.1, Definitions, to 
modify the Good Til Day (or ``GTD'') Time in Force. Currently, GTD 
orders are limited to the specific trading day on which they are 
entered, as the Exchange does not currently offer any orders that 
continue to remain on the Exchange for more than a single trading day 
(i.e., does not carry any orders overnight). The Exchange notes that it 
received approval to offer the GTC Time in Force as part of its 
proposal to adopt rules to allow trading of complex orders on EDGX 
Options.\5\ The GTC Time in Force is not limited to the trading day on 
which an order is entered.
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    \5\ See Securities Exchange Act Release No. 81891 (October 17, 
2017), 82 FR 49058 (October 23, 2017) (SR-Bats-EDGX-2017-29).
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    The Exchange plans to make available the GTC Time in Force 
effective January 26, 2018. In connection with such release, the 
Exchange proposes to modify the GTD Time in Force to also allow orders 
with such Time in Force to remain in effect past the day on which they 
were entered, and therefore proposes to remove language that refers to 
the time of expiration as needing to be ``during such trading day''. In 
addition, to avoid confusion, the Exchange proposes to modify the name 
of the GTD Time in Force to ``Good Til Date'', which is more reflective 
of a Time in Force that can last for more than one trading day.
    The Exchange does not believe that offering GTD functionality that 
allows orders to remain with the Exchange for more than one trading day 
raises any issues that are not already present with GTC orders. In 
turn, GTC is a common time in force and is typically implemented to 
allow orders to remain for more than one trading day.\6\ The Exchange 
simply has not offered such functionality previously and therefore has 
had specific language reflecting that an expiration time must be during 
the trading day. The Exchange also notes that a GTD modifier providing 
a Time in Force that could last more than one day has been previously 
offered by at least one equities exchange not affiliated with the 
Exchange.\7\
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    \6\ See, e.g., C2 Rule 6.10(d)(2).
    \7\ See Securities Exchange Act Release No. 75497 (July 21, 
2015), 80 FR 45022 (July 28, 2015) (SR-NYSEArca-2015-56) (notice of 
filing by NYSE Arca describing proposed changes in connection with 
migration of technology to new platform, including retirement of GTD 
modifier).
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \8\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \9\ in particular, in that it is designed to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general to protect investors and the public interest. 
The Exchange believes the proposed amendment will provide additional 
flexibility to Users that wish to enter an order that will last past 
the trading day on which it is entered by allowing such Users to set a 
specific expiration time. The Exchange also believes the proposed 
amendment will increase the understanding of the Exchange's operations 
for all Users of the Exchange. In particular, the Exchange intends to 
release the GTC Time in Force in the near future, which will persist 
over multiple trading days unless cancelled, and believes that the Time 
in Force of GTD should similarly be able to persist over multiple 
trading days. The Exchange believes it could be confusing and 
inconsistent to offer a GTC Time in Force that can persist for longer 
than a

[[Page 5494]]

single trading day and a GTD Time in Force, which commonly means ``Good 
Til Date'', but that would have to expire no later than the end of the 
trading day on which it was entered. 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.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
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(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 that is not necessary or appropriate 
in furtherance of the purposes of the Act. The proposed change is a 
minor update to an existing Time in Force, GTD, given the update to the 
Exchange's technology that will allow orders to persist for more than 
one trading day. The Exchange does not believe that the proposed 
changes will have any direct impact on competition. Thus, the Exchange 
does not believe that the proposal creates any significant impact on 
competition.

(C) Self-Regulatory Organization's Statement on Comments on the 
Proposed Rule Change Received From Members, Participants or Others

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any written comments from members or other interested parties.

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 \10\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\11\
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    \10\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires the Exchange to give the Commission written notice of the 
Exchange's intent to file the proposed rule change, along with a 
brief description and text of 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.
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    A proposed rule change filed under Rule 19b-4(f)(6) \12\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, Rule 19b-4(f)(6)(iii) \13\ permits the Commission to 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the Exchange 
may, as soon as possible, implement the proposed rule change. The 
Exchange notes that the proposal will promote consistency between the 
GTC and GTD Times in Force offered by the Exchange. The Commission 
believes that waiver of the 30-day operative delay is consistent with 
the protection of investors and the public interest. Accordingly, the 
Commission hereby waives the operative delay and designates the 
proposed rule change as operative upon filing.\14\
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    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
    \14\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    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 [email protected]. Please include 
File Number SR-CboeEDGX-2018-003 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-CboeEDGX-2018-003. 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-CboeEDGX-2018-003 and should be 
submitted on or before February 28, 2018.
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    \15\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-02397 Filed 2-6-18; 8:45 am]
 BILLING CODE 8011-01-P