Document ID: SEC-2020-1903-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Cboe Exchange, Inc.
Posted Date: 2020-12-01T05:00Z

[Federal Register Volume 85, Number 231 (Tuesday, December 1, 2020)]
[Notices]
[Pages 77295-77297]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-26403]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-90504; File No. SR-CBOE-2020-111]

Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change Relating 
To Amend Its Fees Schedule

November 24, 2020.
    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 November 16, 2020, Cboe Exchange, Inc. (the ``Exchange'' or 
``Cboe Options'') filed with the Securities and Exchange Commission 
(the ``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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Cboe Exchange, Inc. (the ``Exchange'' or ``Cboe Options'') proposes 
to amend its fees schedule. The text of the proposed rule change is 
provided in Exhibit 5.
    The text of the proposed rule change is also available on the 
Exchange's website (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, and at the Commission's Public Reference Room.

[[Page 77296]]

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 adopt a new COVID-19 Test Fee in 
connection with the COVID-19 pandemic. By way of background, on March 
16, 2020, the Exchange suspended open outcry trading to help prevent 
the spread of COVID-19 \3\ and was operating in an all-electronic 
configuration until June 15, 2020. On June 15, 2020, the Exchange 
reopened its trading floor, but with a modified configuration of 
trading crowds in order to implement social distancing and other 
measures consistent with local and state health and safety guidelines 
to help protect the safety and welfare of individuals accessing the 
trading floor. In order to further protect the safety and welfare of 
individuals accessing the trading floor during the COVID-19 pandemic, 
the Exchange has determined to implement on-site COVID-19 testing for 
all trading floor personnel, beginning November 16, 2020. The Exchange 
has contracted with an independent health care provider who will 
conduct the tests, which the Exchange anticipates will be conducted 
twice weekly. The Exchange proposes to adopt a pass-through fee of $150 
per test for each TPH or associated person of a TPH \4\ that is tested. 
The proposed COVID-19 Test Fee allows the Exchange to offset the costs 
incurred with on-site testing. The Exchange also notes that since the 
reopening of the trading floor, the Exchange has, and continues to, 
incur other COVID-19 related costs that it has not passed through in 
connection with protecting the health and safety of TPHs and exchange 
personnel, including costs related to daily-deep cleaning. The Exchange 
represents that the proposed fee is a pass-through of the costs to the 
Exchange and that the Exchange will not generate any revenue in excess 
of those costs.
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    \3\ On March 11, 2020, the World Health Organization 
characterized COVID-19 as a pandemic and to slow the spread of the 
disease, federal and state officials implemented social-distancing 
measures, placed significant limitations on large gatherings, 
limited travel, and closed non-essential businesses.
    \4\ For example, a TPH may have personnel other than Nominees on 
the floor that need to access the trading floor. Such persons will 
also be subject to testing requirements and will be assessed the 
proposed fee.
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2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations thereunder applicable to the Exchange and, in particular, 
the requirements of Section 6(b) of the Act.\5\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \6\ requirements that the rules of an exchange be 
designed to prevent fraudulent and manipulative acts and practices, 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, 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 the proposed rule change is consistent with 
Section 6(b)(4) of the Act,\7\ which requires that Exchange rules 
provide for the equitable allocation of reasonable dues, fees, and 
other charges among its Trading Permit Holders and other persons using 
its facilities.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
    \7\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes the proposed COVID-19 Test Fee is reasonable 
as the amount of the proposed fee is the same amount that is assessed 
to the Exchange by the independent health care provider that will be 
administering the tests. As noted above, the revenue generated from the 
proposed fee will not be more than the cost to the Exchange for 
administering the tests. The Exchange also notes that to date, it has 
absorbed all the costs incurred in connection with the safety and 
health protocols it has taken to ensure the safety and welfare of 
individuals access the trading floor, including daily deep-cleaning of 
its facilities. The Exchange believes administering COVID-19 tests will 
help further protect the safety and welfare of individuals accessing 
its trading floor. The Exchange believes the proposed fee is equitable 
and not unfairly discriminatory because such fee will be assessed to 
any TPH or associated person of a TPH that is tested and accesses the 
trading floor. The Exchange also notes that implementing on-site COVID-
19 testing would benefit all persons accessing the trading floor as it 
is an additional precautionary measure intended to limit their exposure 
to COVID-19 and better ensure their safety and welfare.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule changes will 
impose any burden on competition that are not necessary or appropriate 
in furtherance of the purposes of the Act. The Exchange notes the 
proposed fee is not intended to address any competitive issue, but 
rather to recoup costs associated with COVID-19 testing in order to 
help protect the safety and welfare of individuals access the trading 
floor. The Exchange does not believe that the proposed rule change will 
impose any burden on intramarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act because the 
proposed changes apply equally to all similarly situated market 
participants. The Exchange does not believe that the proposed rule 
changes will impose any burden on intermarket competition that is not 
necessary or appropriate in furtherance of the purposes of the Act 
because the proposed changes only affect trading on the Exchange in 
limited circumstances.

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

    The Exchange neither solicited nor received comments on the 
proposed rule change.

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) of the Act \8\ and paragraph (f) of Rule 19b-4 \9\ 
thereunder. 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

[[Page 77297]]

the purposes of the Act. If the Commission takes such action, the 
Commission will institute proceedings to determine whether the proposed 
rule change should be approved or disapproved.
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f).
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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-CBOE-2020-111 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-CBOE-2020-111. 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. All submissions should refer to 
File Number SR-CBOE-2020-111 and should be submitted on or before 
December 22, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-26403 Filed 11-30-20; 8:45 am]
BILLING CODE 8011-01-P