Document ID: SEC-2021-0568-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Nasdaq BX, Inc.
Posted Date: 2021-04-23T04:00Z

[Federal Register Volume 86, Number 77 (Friday, April 23, 2021)]
[Notices]
[Pages 21775-21780]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-08421]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-91610; File No. SR-BX-2021-013]

Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend Options 3, 
Section 10, Order Book Allocation

April 19, 2021.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

[[Page 21776]]

(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on April 7, 2021, Nasdaq BX, Inc. (``BX'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``SEC'' or ``Commission'') the 
proposed rule change as described in Items I and II 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 Options 3, Section 10, Order Book 
Allocation.
    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 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 Options 3, Section 10, Order Book 
Allocation. Today, pursuant to Options 3, Section 10, BX determines for 
each option whether to apply the Price/Time \3\ or the Size Pro-Rata 
execution algorithm.\4\ This proposal seeks to amend BX's Price/Time 
execution algorithm.
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    \3\ The System shall execute trading interest within the System 
in price/time priority, meaning it will execute all trading interest 
at the best price level within the System before executing trading 
interest at the next best price. Within each price level, if there 
are two or more quotes or orders at the best price, trading interest 
will be executed in time priority. See Options 3, Section 
10(a)(1)(A).
    \4\ The System shall execute trading interest within the System 
in price priority, meaning it will execute all trading interest at 
the best price level within the System before executing trading 
interest at the next best price. Within each price level, if there 
are two or more quotes or orders at the best price, trading interest 
will be executed based on the size of each Participant's quote or 
order as a percentage of the total size of all orders and quotes 
resting at that price. If the result is not a whole number, it will 
be rounded up to the nearest whole number. See Options 3, Section 
10(a)(1)(B).
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Price/Time Execution Algorithm
    Today, there are 5 priority overlays for the Price/Time execution 
algorithm: (1) Public Customer Priority; (2) Lead Market Maker 
(``LMM'') Priority; (3) Entitlement for Orders of 5 contracts or fewer; 
(4) Directed Market Maker (``DMM'') Priority; and (5) All Other 
Remaining Interest. The Exchange proposes to amend the LMM Priority 
overlay with this proposal.
    Today, Public Customer orders shall have priority over non-Public 
Customer orders at the same price.\5\ Public Customer Priority is 
always in effect when the Price/Time execution algorithm is in effect. 
The LMM participant entitlements shall only be in effect when the 
Public Customer Priority Overlay is also in effect.\6\
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    \5\ If there are two or more Public Customer orders for the same 
options series at the same price, priority shall be afforded to such 
Public Customer orders in the sequence in which they are received by 
the System. See Options 3, Section 10(a)(1)(C)(1)(a).
    \6\ See Options 3, Section 10(a)(1)(C)(1)(b).
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    Today, Options 3, Section 10(a)(1)(C)(1)(b) provides, in part, 
After all Public Customer orders have been fully executed, upon receipt 
of an order, provided the LMM's bid/offer is at or improves on the 
Exchange's disseminated price, the LMM will be afforded a participation 
entitlement. The LMM shall not be entitled to receive a number of 
contracts that is greater than the displayed size associated with such 
LMM. LMM participation entitlements will be considered after the 
Opening Process. The LMM participation entitlement is as follows:
    (1) A BX Options LMM shall receive the greater of:
    (a) Contracts the LMM would receive if the allocation was based on 
time priority pursuant to subparagraph (C)(1)(a) above with Public 
Customer priority;
    (b) 50% of remaining interest if there is one or no other Market 
Maker at that price;
    (c) 40% of remaining interest if there is two other Market Makers 
at that price;
    (d) 30% of remaining interest if there are more than two other 
Market Makers at that price; or
    (e) the Directed Market Maker (``DMM'') participation entitlement, 
if any, set forth in subsection (C)(1)(c) below (if the order is a 
Directed Order and the LMM is also the DMM).\7\
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    \7\ Rounding will be up to the nearest integer. Notwithstanding 
the foregoing, when a Directed Order is received and the DMM's bid/
offer is at or improves on the NBBO and the LMM is at the same price 
level and is not the DMM, the LMM participation entitlement set 
forth in this subsection (C)(1)(b)(1) will not apply with respect to 
such Directed Order. See Options 3, Section 10(a)(1)(C)(1).
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    The Exchange notes that the System does not operate as provided for 
above today.\8\ At this time, the Exchange proposes to amend the LMM 
Priority to instead provide the following:
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    \8\ As of September 14, 2020 and September 21, 2021 (depending 
on the options symbol) the LMM allocation operated as described in 
the proposed rule text. The migration occurred in two stages as 
symbols were made available on the new BX platform (``Migration'') 
on the two days noted.
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    . . . The LMM participation entitlement is as follows:
    (1) A BX Options LMM shall receive the greater of:
    (a) Contracts the LMM would receive if the allocation was based on 
time priority pursuant to subparagraph (C)(1)(a) above with Public 
Customer priority;
    (b) 50% of remaining interest if there is one other non-Public 
Customer Order or Market Maker order or quote at that price;
    (c) 40% of remaining interest if there are two other non-Public 
Customer Order or Market Maker orders or quotes at that price;
    (d) 30% of remaining interest if there are more than two other non-
Public Customer Order or Market Maker orders or quotes at that price; 
or
    (e) the Directed Market Maker (``DMM'') participation entitlement, 
if any, set forth in subsection (C)(1)(c) below (if the order is a 
Directed Order and the LMM is also the DMM).
    Specifically, the Exchange proposes to determine an LMM's 
allocation percentage (50%/40%/30%), if applicable, by how many Market 
Maker orders and quotes and non-Public Customer orders are present at 
the best price. After all Public Customer orders have been satisfied, 
the System would allocate to an LMM the applicable percentage based on 
non-Public Customer orders and Market Maker quotes and orders at the 
best price at the time the incoming order was received by the System. 
This proposed change would align the System with the rule. This 
amendment differs from the manner in which the LMM was allocated prior 
to the Migration. Prior to the Migration, only other Market Maker 
orders or quotes present at the same price would have determined the

[[Page 21777]]

percentage of allocation for an LMM. With this amendment, non-Public 
Customers orders present at the same price would also be considered in 
determining the percentage. The proposed amendment is similar to 
functionality on Nasdaq ISE, LLC (``ISE''), Nasdaq GEMX, LLC 
(``GEMX''), Nasdaq MRX, LLC (``MRX'') and the Cboe Exchange, Inc 
(``Cboe'').\9\
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    \9\ See ISE, GEMX and MRX Options 3, Section 10(c)(1)(B)(i) and 
Cboe Rule 5.32(a)(2)(B).
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    The Exchange is not considering Public Customer orders in 
determining the LMM allocation because, as noted above, Public Customer 
orders shall have priority over all other interest at the same price 
and those orders would have been executed prior to any LMM allocation.
    With respect to LMMS, unlike other market participants, LMMs have 
unique obligations \10\ to the market which include, among other 
things, quoting obligations.\11\ However, similar to other market 
participants, an LMM cannot receive any portion of an allocation, 
regardless of its participation rights, unless it is quoting at the 
best price at the time the executable order is received by the System. 
With this proposal LMM's would continue to be entitled to an enhanced 
allocation, once Public Customer orders have been satisfied, except 
that allocation would be subject to the amount of other Market Maker 
interest as well as non-Public Customer orders. The Exchange seeks to 
consider non-Public Customer orders in its LMM allocation to recognize 
other market participant interest, except for Public Customer, that was 
present in the Order Book at the same price at the time of execution. 
By considering this interest, non-Public Customers allocated in the 
``All Other Remaining Interest'' category would be entitled to 
potentially higher allocations. The Exchange's proposal is intended to 
encourage LMMs to continue to quote at or improve the NBBO in order to 
be afforded the highest allocation attainable. The proposal also seeks 
to recognize other non-Public Customer interest that was at the same 
price at the time of execution by permitting those market participants 
to capture a potentially higher allocation. Below are some examples.
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    \10\ See Options 2, Section 4.
    \11\ See Options 2, Section 5.
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LMM Allocation Example--Which Only Considers Market Maker Interest
    Assume the option below is open and away markets are wider than 
BX's interest that arrives in sequence as specified below:

[ssquf] LMM Quote: 1.00 (10) x 2.00 (10)
[ssquf] Priority Customer Order Firm A to Sell 2 @ 1.95 arrives (BX BBO 
updates to 1.00 x 1.95)
[ssquf] Broker Dealer Order to Sell 10 @ 1.95 arrives
[ssquf] LMM Updates Quote: 1.00 (10) x 1.95 (10)
[ssquf] Priority Customer Order Firm B to buy 12 @ 1.95 arrives
Allocation
    In this scenario, Priority Customer Firm A is allocated 2 @ 1.95 
and the LMM is allocated remaining 10 @ 1.95.
LMM Allocation Example Which Considers Market Maker and Non-Public 
Customer Interest
    Assume the option below is open and any away markets are wider than 
BX's interest that arrives in sequence as specified below:

[ssquf] LMM Quote: 1.00 (10) x 2.00 (10)
[ssquf] Priority Customer Order Firm A to Sell 2 @ 1.95 arrives (BX BBO 
updates to 1.00 x 1.95)
[ssquf] Broker Dealer Order to Sell 10 @ 1.95 arrives
[ssquf] LMM Updates Quote: 1.00 (10) x 1.95 (10)
[ssquf] Priority Customer Order Firm B to buy 12 @ 1.95 arrives
Allocation
    In this scenario, Priority Customer Firm A is allocated 2 @ 1.95, 
the LMM is allocated 5 @ 1.95 (1 other non-public customer = 50%) and 
the Broker Dealer is allocated 5 @ 1.95.
    At this time, a similar proposed change is not being made to BX's 
Size Pro-Rata execution algorithm, which today only considers Market 
Maker quotes and orders within the LMM Priority, and has an additional 
Market Maker Priority allocation within the Size Pro-Rata execution 
algorithm as compared to the Price/Time execution algorithm. If BX were 
to consider non-Public Customer Orders in the LMM Priority for BX's 
Size Pro-Rata execution algorithm, because there is a Market Maker 
Priority allocation in this model, which does not exist in the Price/
Time execution algorithm, the Market Maker Priority would benefit. In 
the Price/Time execution algorithm, the All Other Remaining Interest 
allocation benefits because there is no Market Maker Priority in that 
model. In the Price/Time execution algorithm all Participants are on 
parity after the LMM Priority. This is not the case with the Size Pro-
Rata execution algorithm because Market Makers have priority ahead of 
All Other Remaining Interest being allocated; there is not the same 
concept of parity. Therefore, making a similar change to BX's Size Pro-
Rata execution algorithm would only serve to advantage other Market 
Makers at the expense of the LMM. Of note, the Lead Market Maker has 
higher quoting obligations both intra-day and during the Opening 
Process as compared to the Market Maker.\12\ See below example for 
illustration.
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    \12\ See Options 2, Section 5 and Options 3, Section 8, 
respectively.
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LMM Size Pro-Rata Allocation Example With Market Maker Overlay
    Assume the option below is open and any away markets are wider than 
BX's interest that arrives in sequence as specified below:

[ssquf] LMM Quote: 1.00 (10) x 2.00 (10)
[ssquf] Priority Customer Order Firm A to Sell 2 @ 1.95 arrives (BX BBO 
updates to 1.00 x 1.95)
[ssquf] Broker Dealer Order to Sell 10 @ 1.95 arrives
[ssquf] Market Maker B Quotes 1.05 x 1.95 (10)
[ssquf] Market Maker C Quotes 1.05 x 1.95 (10)
[ssquf] LMM Updates Quote: 1.00 (20) x 1.95 (20)
[ssquf] Priority Customer Order Firm B to buy 12 @ 1.95 arrives
Allocation
    In this scenario, Priority Customer Firm A is allocated 2 contracts 
@ 1.95, the LMM is allocated 4 contracts @ 1.95 (2 other Market Maker 
quotes present = 40% LMM allocation), both Market Makers B and C are 
allocated 3 contracts at @ 1.95, and Broker Dealer is not allocated any 
contracts. In this example, the Broker Dealer order cannot be 
allocated. If the Exchange were to consider the Broker Dealer order 
within the LMM Priority, as proposed for the Price/Time execution 
algorithm, it would have resulted in a higher allocation for one of the 
Market Makers, to the detriment of the LMM.
    The Exchange notes that all symbols on BX are currently designated 
as Price/Time. In the event that the Exchange determines to designate 
options symbols as eligible for Size Pro-Rata allocation, a similar 
change would be considered by the Exchange and, if the Exchange 
determines to amend its rule, a proposed rule change would be submitted 
to the Commission.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\13\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\14\ in particular, in that it is designed to

[[Page 21778]]

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.
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    \13\ 15 U.S.C. 78f(b).
    \14\ 15 U.S.C. 78f(b)(5).
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    The Exchange's proposal to amend the Price/Time LMM execution 
algorithm to consider non-Public Customer orders in addition to Market 
Maker quotes and orders when allocating a percentage to an LMM is 
consistent with the Act. The Exchange is not considering Public 
Customer orders in determining the LMM allocation because, as noted 
above, Public Customer orders shall have priority over non-Public 
Customer orders at the same price and those orders would have been 
executed prior to any LMM allocation. With respect to LMMs, unlike 
other market participants, LMMs have unique obligations \15\ to the 
market which include, among other things, quoting obligations.\16\ 
However, similar to other market participants, an LMM cannot receive 
any portion of an allocation, regardless of its participation rights, 
unless it is quoting at the best price at the time the executable order 
is received by the System.
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    \15\ See note 10 above.
    \16\ See note 11 above.
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    With this proposal LMM's would continue to be entitled to an 
enhanced allocation, once Public Customer orders have been satisfied, 
except that allocation would be subject to the amount of other Market 
Maker interest as well as non-Public Customer orders. The Exchange 
seeks to consider non-Public Customer orders in its LMM allocation to 
recognize other market participant interest, except for Public 
Customer, that was present in the Order Book at the same price at the 
time of execution. By considering this interest, non-Public Customers 
allocated in the ``All Other Remaining Interest'' category would be 
entitled to potentially higher allocations. The Exchange believes that 
this amendment will encourage other non-Public Customers to submit 
interest into the Order Book, at the same price, in order to receive a 
potentially higher allocation after all Maker Makers have been 
allocated.\17\ With this proposal LMMs would be encouraged to quote at 
or improve the NBBO in more cases in order to be afforded the highest 
allocation attainable. Creating competition which rewards Participants 
that continuously add liquidity to the Order Book benefits all market 
participants.
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    \17\ There are 5 priority overlays for the Price/Time execution 
algorithm: (1) Public Customer Priority; (2) LMM Priority; (3) 
Entitlement for Orders of 5 contracts or fewer; (4) DMM Priority; 
and (5) All Other Remaining Interest.
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    The Exchange notes that at this time a similar proposed change is 
not being made to the Size Pro-Rata execution algorithm, which today 
only considers Market Maker quotes and orders within the LMM 
Enhancement. The Exchange notes that all symbols on BX are currently 
designated as Price/Time. Unlike the Price/Time execution algorithm, 
the Size Pro-Rata execution algorithm has 6 overlays: (1) Public 
Customer Priority; (2) LMM Priority; (3) Entitlement for Orders of 5 
contracts or fewer; (4) Directed Market Maker Priority; (5) Market 
Maker Priority; and (6) All Other Remaining Interest. The Price/Time 
execution algorithm does not have a Market Maker Priority allocation 
similar to the Size Pro-Rata execution algorithm. The current Market 
Maker Priority considers all other Participant orders at the same price 
and, therefore, rewards Participants at that price in a similar fashion 
as proposed for the Price/Time execution algorithm, albeit at the 
Market Maker allocation instead of the LMM allocation. The Exchange 
believes that the proposal would serve to align the two allocation 
models and reward Participants at the same price by considering non-
Public Customer interest as well as Market Maker interest before non-
Public Customers are allocated. An example of how the same scenario 
presented above for the Price/Time model would allocated within the 
current Size Pro Rata model is below.
LMM Allocation Example--Size Pro-Rata Overlay Example
    Assume the option below is open and away markets are wider than 
BX's interest that arrives in sequence as specified below:

[ssquf] LMM Quote: 1.00 (10) x 2.00 (10)
[ssquf] Priority Customer Order Firm A to Sell 2 @ 1.95 arrives (BX BBO 
updates to 1.00 x 1.95)
[ssquf] Broker Dealer Order to Sell 10 @ 1.95 arrives
[ssquf] Market Maker B quote 1.00 (10) x 1.95 (10) arrives
[ssquf] Market Maker C quote 1.00 (10) x 1.95 (10) arrives
[ssquf] LMM Updates Quote: 1.00 (10) x 1.95 (10)
[ssquf] Priority Customer Order Firm B to buy 22 @ 1.95 arrives
Allocation
    In this scenario:

 Priority Customer Firm A is allocated 2 @ 1.95
 Lead Market Maker is allocated 8 @ 1.95 (40% of remaining 20 
contracts after priority customer overlay)
 Market Maker B is allocated 6 @ 1.95 (50% of remaining 12 
contracts after LMM overlay)
 Market Maker C is allocated 6 @ 1.95 (50% of remaining 12 
contracts after LMM overlay)

    In this scenario, the Broker Dealer is not allocated as the Market 
Maker was allocated the remaining 12 contracts. Even if the LMM overlay 
considered the Broker Dealer in its allocation, the Broker Dealer will 
still not be allocated. The LMM would get 6 contracts (30% of 20 
contracts), and each of the Market Makers would get 7 contracts, which 
only reduces the LMM allocation as the LMM was quoting at the same 
price as the other Market Makers.
    The Exchange notes that the System does not operate as provided for 
above today.\18\ This proposed change would align the System with the 
rule. The proposed amendment is similar to functionality on Nasdaq ISE, 
LLC (``ISE''), Nasdaq GEMX, LLC (``GEMX''), Nasdaq MRX, LLC (``MRX'') 
and the Cboe Exchange, Inc (``Cboe'').\19\
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    \18\ See note 8 above.
    \19\ See ISE, GEMX and MRX Options 3, Section 10(c)(1)(B)(i) and 
Cboe Rule 5.32(a)(2)(B).
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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 not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange is not considering 
Public Customer orders in determining the LMM allocation because, as 
noted above, Public Customer orders shall have priority over non-Public 
Customer orders at the same price and those orders would have been 
executed prior to any LMM allocation.
    The Exchange seeks to consider non-Public Customer orders in its 
LMM allocation to recognize other market participant interest, except 
for Public Customer, that was present in the Order Book at the same 
price at the time of execution. By considering this interest, non-
Public Customers allocated in the ``All Other Remaining Interest'' 
category would be entitled to potentially higher allocations. The 
amendment will encourage other non-Public Customers to submit interest 
into the Order Book, at the same price, in order to receive a 
potentially higher allocation after all Maker Makers have been 
allocated. With this proposal LMMs would be encouraged to quote at or 
improve the NBBO in more cases in order to be afforded the highest 
allocation attainable. Creating competition which rewards Participants 
that continuously

[[Page 21779]]

add liquidity to the Order Book benefits all market participants. The 
Exchange does not believe its proposal imposes an undue burden on 
competition because with this change, non-Public Customer orders would 
be entitled to potentially higher allocations.
    With respect to LMMs, unlike other market participants, LMMs have 
unique obligations \20\ to the market which include, among other 
things, quoting obligations.\21\ However, similar to other market 
participants, an LMM cannot receive any portion of an allocation, 
regardless of its participation rights, unless it is quoting at the 
best price at the time the executable order is received by the System. 
LMM's would continue to be entitled to an enhanced allocation, once 
Public Customer orders have been satisfied, except that allocation 
would be subject to the amount of other Market Maker interest as well 
as non-Public Customer orders.
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    \20\ See note 10 above.
    \21\ See note 11 above.
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    Today, LMMs may receive higher allocations as only other Market 
Maker interest is considered when allocating to an LMM. With this 
proposal, the Exchange would consider not only other Market Maker 
interest but also non-Public Customer orders. Considering all other 
interest, except Public Customer interest, that was at the same price 
at the time of execution results in LMMs potentially receiving lower 
allocations. LMMs add value through continuous quoting \22\ and are 
subject to additional requirements and obligations \23\ unlike other 
market participants. The Exchange incentivizes LMMs to provide 
liquidity on BX through enhanced allocations and pricing. The Exchange 
believes that this proposal will continue to incentivize LMMs to add 
liquidity while also benefitting all market participants through the 
quality of order interaction.
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    \22\ See Options 2, Section 5.
    \23\ See Options 2, Section 4.
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    Unlike the Price/Time execution algorithm, the Size Pro-Rata 
execution algorithm has 6 overlays: (1) Public Customer Priority; (2) 
LMM Priority; (3) Entitlement for Orders of 5 contracts or fewer; (4) 
DMM Priority; (5) Market Maker Priority; and (6) All Other Remaining 
Interest. The Price/Time execution algorithm does not have a Market 
Maker Priority allocation similar to the Size Pro-Rata execution 
algorithm. The current Market Maker Priority considers all other 
Participant orders at the same price and, therefore, rewards 
Participants at that price in a similar fashion as proposed for the 
Price/Time execution algorithm, albeit at the Market Maker allocation 
instead of the LMM allocation. The Exchange believes that the proposal 
does not impose an undue burden on competition as it aligns the two 
models and reward Participants at the same price by considering non-
Public Customer interest as well as Market Maker interest before non-
Public Customers are allocated.

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

    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) of the Act \24\ and Rule 19b-
4(f)(6) thereunder.\25\
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    \24\ 15 U.S.C. 78s(b)(3)(A).
    \25\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its 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 pursuant to Rule 19b-4(f)(6) under the 
Act \26\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \27\ 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 requested that the Commission waive the 30-day operative delay. As 
the proposed rule change raises no novel issues and more accurately 
describes the System's treatment of LMM allocation, 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 operative upon filing.\28\
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    \26\ 17 CFR 240.19b-4(f)(6).
    \27\ 17 CFR 240.19b-4(f)(6)(iii).
    \28\ For purposes only of waiving the 30-day operative delay, 
the Commission also has 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 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 change 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-2021-013 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-2021-013. 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

[[Page 21780]]

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-BX-2021-013, and should be submitted on 
or before May 14, 2021.
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    \29\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\29\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-08421 Filed 4-22-21; 8:45 am]
BILLING CODE 8011-01-P