Document ID: SEC-2023-1258-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: MIAX PEARL, LLC
Posted Date: 2023-11-02T04:00Z

[Federal Register Volume 88, Number 211 (Thursday, November 2, 2023)]
[Notices]
[Pages 75338-75342]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-24270]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-98825; File No. SR-PEARL-2023-58]

Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend Exchange 
Rules 2614(a)(1)(ix) and 2618(b)(1) To Amend Certain Risk Controls When 
Trading Equity Securities on MIAX Pearl Equities

    Pursuant to the provisions of 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 October 19, 2023, MIAX PEARL, LLC (``MIAX 
Pearl'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') a 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

    The Exchange proposes to amend its existing risk controls for 
Equity Members \3\ when trading equity securities on the Exchange's 
equity trading platform (referred to herein as ``MIAX Pearl 
Equities'').
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    \3\ The term ``Equity Member'' is a Member authorized by the 
Exchange to transact business on MIAX Pearl Equities. See Exchange 
Rule 1901.
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    The text of the proposed rule change is available on the Exchange's 
website at https://www.miaxglobal.com/markets/us-equities/pearl-equities/rule-filings, at MIAX Pearl's principal office, 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 purpose of the proposed rule change is to amend certain 
existing risk controls when trading equity securities on MIAX Pearl 
Equities. To help Equity Members manage their risk, the Exchange 
currently offers Limit Order Price Protection and other risk controls 
that authorize the Exchange to take automated action if a designated 
limit for an Equity Member is breached. Such risk controls provide 
Equity Members with enhanced abilities to manage their risk when 
trading on the Exchange. The Exchange now proposes to amend Limit Order 
Price Protection under Exchange Rule 2614(a)(1)(ix) and Trading Collar 
under Exchange Rule 2618(b)(1) to enhance certain existing risk 
controls available to Equity Members. Each of these changes are 
described below.
Limit Order Price Protection Reference Price
    Limit Order Price Protection is set forth under Exchange Rule 
2614(a)(1)(ix) and provides for the cancellation of Limit Orders priced 
too far away from a specified reference price at the time the order 
first becomes eligible to trade. A Limit Order entered before Regular 
Trading Hours \4\ that becomes eligible to trade during Regular Trading 
Hours will be subject to Limit Order Price Protection at the time 
Regular Trading Hours begins.\5\
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    \4\ The term ``Regular Trading Hours'' means the time between 
9:30 a.m. and 4:00 p.m. Eastern Time. See Exchange Rule 1901.
    \5\ Further, a Limit Order in a security that is subject to a 
trading halt becomes first eligible to trade when the halt is lifted 
and continuous trading has resumed. See Exchange Rule 
2614(a)(1)(ix)(C).
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    Exchange Rule 2614(a)(1)(ix)(A) provides that a Limit Order to buy 
(sell) will be rejected if it is priced at or above (below) the greater 
of a specified dollar value and percentage away from the following: (1) 
the PBO for Limit Orders to buy, the PBB for Limit Orders to sell; (2) 
if the PBO or PBB is unavailable, the consolidated last sale price 
disseminated during the Regular Trading Hours on trade date; (3) if the 
PBO, PBB, and a consolidated last sale price are unavailable, the prior 
day's Official Closing Price identified as such by the primary listing 
exchange, adjusted to account for events such as corporate actions and 
news events. Exchange Rule 2614(a)(1)(ix)(C) provides that Limit Order 
Price Protection will not be applied if the prices listed above are 
unavailable or if

[[Page 75339]]

the Official Closing Price listed under paragraph (a)(1)(ix)(A)3. is to 
be applied and a regulatory halt has been declared by the primary 
listing market during that trading day. The Exchange proposes to 
reorganize Exchange Rule 2614(a)(1)(ix)(C) to place these provisions 
under subparagraphs 1. and 2., respectively. Equity Members have 
requested that Limit Order Price Protection also not be applied when no 
consolidated last sale price has been disseminated following the 
conclusion of a regulatory halt declared by the primary listing market 
during that trading day. The consolidated last sale price disseminated 
prior to a regulatory halt likely does not appropriately relate to the 
current trading behavior of the security in such a scenario and Equity 
Members have informed the Exchange that they would prefer Limit Order 
Price Protections not be applied since it may result in their order 
being unnecessarily cancelled. The cancellation may be unnecessary 
because the specified reference price used to calculate whether the 
Limit Order should be cancelled was established prior to the security 
being halted and likely stale. A consolidated last sale disseminated 
following the conclusion of a regulatory halt would be much more 
indicative of the security's trading behavior.
    This proposed change is similar to a recent proposal by the 
Exchange to amend Exchange Rule 2614(a)(1)(ix)(C) to provide that Limit 
Order Price Protection would not be applied when a regulatory halt has 
been declared by the primary listing market during that trading day and 
the Exchange would have applied the prior day's Official Closing Price 
because the PBO, PBB, and a consolidated last sale price are 
unavailable.\6\ Like in this proposal, the prior proposal was also in 
response to requests from Equity Members that Limit Order Price 
Protection not be applied when a stale reference price may be used. In 
the prior proposal, the concern was that the prior day's Official 
Closing Price would be used when the PBO, PBB, and a consolidated last 
sale price are unavailable and a trading halt has been declared by the 
primary listing market during that trading day because the Official 
Closing Price would not appropriately relate to the current trading 
behavior of the security in such a scenario. In such case, Equity 
Members preferred Limit Order Price Protection not be applied since it 
may result in their Limit Order being unnecessarily cancelled. The same 
is true here.
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    \6\ See Securities Exchange Act Release No. 96205 (November 1, 
2022), 87 FR 67080 (November 7, 2022) (SR-PEARL-2022-43).
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    The Exchange, therefore, proposes to amend Exchange Rule 
2614(a)(1)(ix)(C) to provide that Limit Order Price Protection would 
not be applied when no consolidated last sale price has been 
disseminated following the conclusion of a regulatory halt declared by 
the primary listing market during that trading day. This provision 
would be codified under subparagraph .3 to reorganized Exchange Rule 
2614(a)(1)(ix)(C).
Trading Collar
    In addition to the Limit Order Price Protection described above, 
the Exchange also prevents all incoming orders, including those marked 
ISO, from executing at a price outside the Trading Collar price range 
as described in Exchange Rule 2618(b). The Trading Collar prevents buy 
orders from trading or routing at prices above the collar and prevents 
sell orders from trading or routing at prices below the collar. The 
Trading Collar price range is calculated using the greater of numerical 
guidelines for clearly erroneous executions under Exchange Rule 2621 or 
a specified dollar value established by the Exchange.
    The Exchange proposes two changes to the application of the Trading 
Collar. First, the Exchange proposes to expand the times during which 
the Trading Collar is applied to include the Exchange's Opening and Re-
Opening Process. Second, the Exchange proposes to not apply the Trading 
Collar in an additional case where the reference price that is to be 
used may be stale and not relate to current market conditions to avoid 
the unnecessary cancellation of orders.
Trading Collar and Opening and Re-Opening Process
    The Exchange proposes to expand the times when the Trading Collar 
would be applied to include the Exchange's Opening and Re-Opening 
Process. Today, Trading Collars are applied to all orders, except those 
orders that are eligible to participate in the Exchange's Opening 
Process under Exchange Rule 2615. The Trading Collar is also not 
applied to all orders during the Exchange's Re-Opening Process.
    The Exchange proposes to amend Exchange Rule 2618(b)(1) to no 
longer exclude orders that are eligible to participate in the 
Exchange's Opening Process from the Trading Collar protection. As 
proposed, Trading Collars would be applied to orders that are eligible 
to participate in the Exchange's Opening and Re-Opening Process. Limit 
Up-Limit Down price bands are disseminated by the applicable Securities 
Information Processor (``SIP'') during Regular Trading Hours.\7\ 
However, the SIP may not have begun to disseminate price bands at the 
beginning of a trading day or after a halt when the Exchange is to 
conduct its Opening or Re-Opening Process, as applicable. In such a 
scenario, Equity Members have expressed the need for additional 
protections around the opening and re-opening of trading where the 
Limit Up-Limit Down price bands are not yet being disseminated by the 
applicable SIP. Therefore, the Exchange proposes to remove language 
from Exchange Rule 2618(b)(1) that states the Exchange will not apply 
the Trading Collar to orders that are eligible to participate in the 
Exchange's Opening Process.\8\ Going forward as a result of this 
proposal, the Trading Collar would be applied to orders eligible to be 
executed in the Exchange's Opening and Re-Opening Process and such 
orders would be prevented from executing at a price outside the Trading 
Collar price range as described in Exchange Rule 2618(b).
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    \7\ See Sections I(S) and V(A)(1) of the Limit Up-Limit Down 
Plan.
    \8\ Exchange Rule 2618(b)(1) does not address the Exchange's 
current practice of not applying the Trading Collar during the Re-
Opening Process and, therefore, the Rule will reflect the proposed 
functionality once this proposal is implemented.
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Trading Collar Reference Price
    Exchange Rule 2618(b)(1) provides that the Trading Collar price 
range is calculated based on a Trading Collar Reference Price and sets 
forth a sequence of prices to determine the Trading Collar Reference 
Price to be used if a certain reference price is unavailable. The 
Exchange first utilizes the consolidated last sale price disseminated 
during the Regular Trading Hours on the trade date as the Trading 
Collar Reference Price. If not available, the prior day's Official 
Closing Price identified as such by the primary listing exchange, 
adjusted to account for events such as corporate actions and news 
events is used. If neither are available to use as the Trading Collar 
Reference Price, the Exchange suspends the Trading Collar function in 
the interest of maintaining a fair and orderly market in the impacted 
security. The Exchange calculates the Trading Collar price range for a 
security by applying the Numerical Guideline and reference price to the 
Trading Collar Reference Price. The result is added to the Trading 
Collar Reference Price to determine the Trading Collar Price for buy 
orders, while the result is

[[Page 75340]]

subtracted from the Trading Collar Reference Price to determine the 
Trading Collar Price for sell orders. Exchange Rule 2618(b)(1)(A) 
provides that the Trading Collar Reference Price is equal to the 
following: (i) consolidated last sale price disseminated during the 
Regular Trading Hours on trade date; or (ii) if (i) is not available, 
the prior day's Official Closing Price identified as such by the 
primary listing exchange, adjusted to account for events such as 
corporate actions and news events. Exchange Rule 2618(b)(1) further 
provides that upon entry, any portion of an order to buy (sell) that 
would execute at a price above (below) the Trading Collar Price is 
cancelled unless the price listed under paragraph (A)(ii) described 
above is to be applied and a regulatory halt has been declared by the 
primary listing market during that trading day. The Exchange proposes 
to reorganize Exchange Rule 2618(b)(1) to separately place these 
provisions under subparagraph (A) and (A)(i) respectively. As a result 
of this reorganization of Exchange Rule 2618(b)(1), the Exchange also 
proposes to update rule cross references within the rule and renumber 
the remainder of Exchange Rule 2618(b)(1) accordingly.
    Like proposed above for Limit Order Price Protection, Equity 
Members have requested that the Trading Collar not be applied if no 
consolidated last sale price has been disseminated following the 
conclusion of a regulatory halt declared by the primary listing market 
on that trading day. The consolidated last sale price disseminated 
prior to a regulatory halt likely does not appropriately relate to the 
current trading behavior of the security in such a scenario and Equity 
Members have informed the Exchange that they would prefer the Trading 
Collar not be applied since it may result in their order being 
unnecessarily cancelled. The cancellation may be unnecessary because 
the specified reference price used to calculate whether the order 
should be cancelled was established prior to the security being halted 
and is likely stale. A consolidated last sale disseminated following 
the conclusion of a regulatory halt would be much more indicative of 
the security's trading behavior.
    Like with the proposed change to Limit Order Price Protection 
discussed above, this proposed change is similar to a recent proposal 
by the Exchange to amend Exchange Rule 2618(b)(1) to provide that upon 
entry, an order priced outside the Trading Collar would not be canceled 
when a trading halt has been declared by the primary listing market 
during that trading day and the Exchange would have applied the prior 
day's Official Closing Price because the consolidated last sale price 
is unavailable.\9\ Like in this proposal, the prior proposal was also 
in response to requests from Equity Members that the Trading Collar not 
be applied when a stale reference price may be used. In the prior 
proposal, the concern was that the prior day's Official Closing Price 
would be used when the consolidated last sale price is unavailable and 
a trading halt has been declared by the primary listing market during 
that trading day because the Official Closing Price would not 
appropriately relate to the current trading behavior of the security in 
such a scenario. In such case, Equity Members preferred the Trading 
Collar not be applied since it may result in their order being 
unnecessarily cancelled. Again, the same is true here.
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    \9\ See supra note 6.
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    The Exchange, therefore, proposes to amend Exchange Rule 2618(b)(1) 
to provide that upon entry, an order priced outside the Trading Collar 
would not be canceled if no consolidated last sale price has been 
disseminated following the conclusion of a regulatory halt declared by 
the primary listing market on that trading day. In such case, the 
Exchange would accept such an order and post it on the MIAX Pearl 
Equities Book at its limit price.\10\ This provision would be codified 
under subparagraph (ii) of reorganized Exchange Rule 2618(b)(1)(A).
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    \10\ In such case, a Limit Order would continue to be subject to 
the Exchange's applicable re-pricing processes. See Exchange Rule 
2614(a)(1)(v)-(viii).
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* * * * *
    The Exchange does not guarantee that the risk settings in this 
proposal are sufficiently comprehensive to meet all of an Equity 
Member's risk management needs. Pursuant to Rule 15c3-5 under the 
Act,\11\ a broker-dealer with market access must perform appropriate 
due diligence to assure that controls are reasonably designed to be 
effective, and otherwise consistent with the rule.\12\ Use of the 
Exchange's risk settings included in Exchange Rule 2618 will not 
automatically constitute compliance with Exchange or federal rules and 
responsibility for compliance with all Exchange and SEC rules remains 
with the Equity Member.
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    \11\ 17 CFR 240.15c3-5.
    \12\ See Division of Trading and Markets, Responses to 
Frequently Asked Questions Concerning Risk Management Controls for 
Brokers or Dealers with Market Access, available at https://www.sec.gov/divisions/marketreg/faq-15c-5-risk-management-controls-bd.htm.
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Implementation
    Due to the technological changes associated with this proposed 
change, the Exchange will issue a trading alert publicly announcing the 
implementation date of the proposed enhancements to its risk controls 
set forth herein. The Exchange anticipates that the implementation date 
will be in the fourth quarter of 2023 or first quarter of 2024.
2. Statutory Basis
    The proposed rule change is consistent with section 6(b) of the 
Act,\13\ in general, and furthers the objectives of section 
6(b)(5),\14\ in particular, because it is 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. Specifically, the Exchange 
believes the proposed amendments will remove impediments to and perfect 
the mechanism of a free and open market and a national market system 
because the augmented functionality is being proposed in response to 
Equity Member feedback as part of their efforts to appropriately manage 
their risk.
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    \13\ 15 U.S.C. 78f(b).
    \14\ 15 U.S.C. 78f(b)(5).
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Trading Collar and Opening and Re-Opening Process
    The Exchange's proposal to amend Exchange Rule 2618(b)(1) to no 
longer exclude orders that are eligible to participate in the 
Exchange's Opening and Re-Opening Process from the Trading Collar 
protection promotes just and equitable principles of trade and protects 
investors and the public interest because it would provide Equity 
Members with additional protections around the opening of trading where 
the Limit Up-Limit Down price bands are not yet being disseminated by 
the applicable SIP. Equity Members have expressed the desire for 
Trading Collar to be applied to orders eligible to be executed in the 
Exchange's Opening and Re-Opening Process and to prevent such orders 
from executing at a price outside the Trading Collar price range as 
described in Exchange Rule 2618(b). By no longer excluding the Opening 
and Re-Opening Process, the proposal expands the time by which the 
Trading

[[Page 75341]]

Collar would be applied to include all orders entered during Regular 
Trading Hours. Doing so should prevent orders from being executed in 
the Exchange's Opening and Re-Opening Process at undesirable prices 
that would have otherwise been outside of the Trading Collar. The 
proposal, therefore, protects investors and the public interest by 
preventing orders from executing outside of the Trading Collar price 
range and resulting in unwanted executions. The Exchange notes that at 
least one other national securities exchange also applies trading 
collars in such a scenario.\15\
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    \15\ See New York Stock Exchange, Inc. (``NYSE'') Rule 
7.31(a)(1)(B). NYSE applies trading collars during Core Trading 
Hours. Core trading hours are defined under NYSE 7.34(a)(2) 
(providing, in sum, that for UTP Securities, the Core Trading 
Session will begin for each security at 9:30 a.m. and end at the 
conclusion of Core Trading Hours and for Exchange-listed securities, 
the Core Trading Session will begin for each security with the Core 
Open Auction, which can take place during Core Trading Hours only).
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Limit Order Price Protection and Trading Collar Reference Price
    The proposal to not apply Limit Order Price Protection and the 
Trading Collar if no consolidated last sale price has been disseminated 
following the conclusion of a regulatory halt declared by the primary 
listing market on that trading day promotes just and equitable 
principles of trade because in such a scenario the consolidated last 
sale price disseminated prior to a regulatory halt does not likely 
appropriately relate to the current trading behavior of the security 
and may result in an order being unnecessarily cancelled.\16\ Equity 
Members are free to not enter orders during such times and enter such 
orders later when Limit Order Price Protection and Trading Collars are 
in effect. The Exchange notes that this proposal is an extension of 
similar change it recently made in response to feedback from Equity 
Members to not apply Limit Order Price Protection or Trading Collars 
when the prior day's Official Closing Price is to be used when the PBO, 
PBB (for Limit Order Price Protection), and a consolidated last sale 
price are unavailable and a trading halt has been declared by the 
primary listing market during that trading day.\17\
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    \16\ The Exchange notes that it will still apply Limit Order 
Price Protection where there is a PBB or PBO. See Exchange Rule 
2614(a)(1)(ix)(A) (providing that a Limit Order to buy (sell) will 
be rejected if it is priced at or above (below) the greater of a 
specified dollar value and percentage away from the following: (1) 
the PBO for Limit Orders to buy, the PBB for Limit Orders to sell . 
. .).
    \17\ See supra note 6.
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    As described above, the Exchange is expanding the scope of the 
Trading Collars to include the entire trading day by no longer 
excluding orders eligible to participate in the Exchange's Opening and 
Re-Opening Process from the protection. This will result in more orders 
being subject to the protection and being prevented from possibly 
executing at prices outside of the Trading Collar range. Not applying 
Limit Order Price Protection and Trading Collar if no consolidated last 
sale price has been disseminated following the conclusion of a 
regulatory halt as proposed herein, does not offset the expansion of 
time the Trading Collar is applied, nor does it create an inappropriate 
gap in the trading day where orders would not be protected. Rather, it 
seeks to address a small period of time following a regulatory halt 
where no consolidated last sale has been disseminated. This may result 
in orders being unnecessarily cancelled due to the Trading Collar or 
Limit Order Price Protection ranges being based on a stale reference 
price. The Exchange also anticipates that this will be an infrequent 
occurrence since it requires a either a first trade and/or two-sided 
quotation to perform its Re-Opening Process.\18\ Any potential time 
period during which the Trading Collar or Limit Order Price Protection 
would not be applied is likely to be rare and very short because the 
Re-Opening Process only occurs without a reported trade where the 
primary listing exchange did not publish a trade within one second of 
publication of its first two-sided quotation.
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    \18\ See Exchange Rule 2615(e)(1)(ii) (stating that the Re-
Opening Process will occur at the midpoint of the: (i) first NBBO 
subsequent to the first reported trade and first two-sided quotation 
on the primary listing exchange following the resumption of trading 
after a halt, suspension, or pause; or (ii) NBBO when the first two-
sided quotation is published by the primary listing exchange 
following the resumption of trading after a halt, suspension, or 
pause if no first trade is reported by the listing exchange within 
one second of publication of the first two-sided quotation by the 
listing exchange (emphasis added).
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    These proposed changes to Limit Order Price Protection and the 
Trading Collar are similar to a recent proposal by the Exchange to not 
apply Limit Order Price Protection or the Trading Collar when a trading 
halt has been declared by the primary listing market during that 
trading day and the Exchange would have applied the prior day's 
Official Closing Price as the reference price.\19\ Like in this 
proposal, the prior proposal was also in response to requests from 
Equity Members that Limit Order Price Protection and the Trading Collar 
not be applied when a stale reference price may be used. In the prior 
proposal, the concern was that the prior day's Official Closing Price 
would be used when the consolidated last sale price is unavailable and 
a trading halt has been declared by the primary listing market during 
that trading day because the Official Closing Price would not 
appropriately relate to the current trading behavior of the security in 
such a scenario. In such case, Equity Members preferred Limit Order 
Price Protection and the Trading Collar not be applied since it may 
result in their order being unnecessarily cancelled. Again, the same is 
true for this proposal.
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    \19\ See supra note 6.
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Rule Reorganization
    The reorganization of Exchange Rules 2614(a)(1)(ix)(C) and 
2618(b)(1) removes impediments to and perfects the mechanism of a free 
and open market and a national market system because these changes make 
each rule easier to comprehend, reducing the potential for inadvertent 
investor confusion.

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.
Trading Collar and Opening and Re-Opening Process
    The Exchange believes its proposal to expand the application of the 
Trading Collar to include the Opening and Re-Opening Process will not 
impose any burden on inter-market competition because it could serve to 
improve the Exchange's market quality by expanding the application of 
this risk protection to include all times during Regular Trading Hours 
and preventing executions during the Exchange's Opening and Re-Opening 
Process at undesirable prices that would have been outside of the 
Trading Collar. The Exchange believes that the proposal may have a 
positive effect on competition because it would allow the Exchange to 
apply Trading Collar during timeframes similar to at least one other 
national securities exchange.\20\ The proposal would impose no burden 
on intra-market competition because each risk setting would be applied 
to all Equity Members' orders equally.
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    \20\ See NYSE Rules 7.31(a)(1)(B) and 7.34(a)(2)(B).
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Limit Order Price Protection and Trading Collar Reference Price
    The Exchange believes its proposal to not apply Limit Order Price 
Protection and the Trading Collar if no consolidated last sale price 
has been

[[Page 75342]]

disseminated following the conclusion of a regulatory halt does not 
burden inter-market competition because it could improve confidence in 
the Exchange's overall execution quality by preventing orders from 
being unnecessarily canceled due to stale reference prices.\21\ 
Further, this proposed rule change may increase confidence in the 
proper functioning of the Exchange and contribute to additional 
competition among trading venues. Rather than impede competition, the 
proposal is designed to avoid the unwanted cancelation of orders 
following a regulatory halt, which, in turn, could enhance the 
integrity of trading on the Exchange. These proposals also would not 
burden intra-market competition because it would apply to all Equity 
Members equally and all Equity Members' orders would not be subject to 
the applicable protection where it would be based on a stale reference 
price and result in an unnecessary cancelation of the order, as 
described here.
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    \21\ See supra note 16.
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Rule Reorganization
    The reorganization of Exchange Rules 2614(a)(1)(ix)(C) and 
2618(b)(1) would not impact competition because such changes would not 
enhance or alter the Exchange's ability to compete, but rather, make 
each rule easier to comprehend, reducing the potential for inadvertent 
investor confusion.

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

    Written comments were neither solicited nor 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 after the date of the filing, or such 
shorter time as the Commission may designate, it has become effective 
pursuant to 19(b)(3)(A) of the Act \22\ and Rule 19b-4(f)(6) \23\ 
thereunder.
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    \22\ 15 U.S.C. 78s(b)(3)(A).
    \23\ 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.
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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 necessary or 
appropriate in the public interest, for the protection of investors, or 
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 (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-PEARL-2023-58 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-PEARL-2023-58. 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 (https://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 
a.m. and 3 p.m. Copies of the filing also will be available for 
inspection and copying at the principal office of the Exchange. Do not 
include personal identifiable information in submissions; you should 
submit only information that you wish to make available publicly. We 
may redact in part or withhold entirely from publication submitted 
material that is obscene or subject to copyright protection. All 
submissions should refer to file number SR-PEARL-2023-58 and should be 
submitted on or before November 24, 2023.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\24\
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    \24\ 17 CFR 200.30-3(a)(12).

    Dated: October 30, 2023.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-24270 Filed 11-1-23; 8:45 am]
BILLING CODE 8011-01-P