Document ID: SEC-2021-0411-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: MIAX Emerald, LLC
Posted Date: 2021-03-24T04:00Z

[Federal Register Volume 86, Number 55 (Wednesday, March 24, 2021)]
[Notices]
[Pages 15759-15763]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-05998]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-91356; File No. SR-EMERALD-2021-09]

Self-Regulatory Organizations; MIAX Emerald, LLC; Notice of 
Filing of a Proposed Rule Change To Adopt Exchange Rule 531, Reports, 
To Provide for the New ``Liquidity Taker Event Report''

March 18, 2021.
    Pursuant to 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 March 5, 2021, MIAX Emerald, LLC (``MIAX Emerald'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``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

    The Exchange proposes to adopt Exchange Rule 531(a) to provide for 
the new ``Liquidity Taker Event Report''.
    The text of the proposed rule change is available on the Exchange's 
website at http://www.miaxoptions.com/rule-filings/emerald at MIAX 
Emerald'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 Exchange proposes to adopt Exchange Rule 531(a) to provide for 
the new ``Liquidity Taker Event Report'' (the ``Report''). The Report 
is an optional product \3\ available to Members.\4\ Currently, the 
Exchange provides real-time prices and analytics in the marketplace. 
The Exchange believes the additional data points from the matching 
engine outlined below may help Members gain a better understanding 
about their interactions with the Exchange. The Exchange believes the 
Report will provide Members with an opportunity to learn more about 
better opportunities to access liquidity and receive better execution 
rates. The proposed Report will increase transparency and democratize 
information so that all firms that subscribe to the Report have access 
to the same information on an equal basis, even for firms that do not 
have the appropriate resources to generate a similar report regarding 
interactions with the Exchange. None of the components of the proposed 
Report include real-time market data.
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    \3\ The Exchange intends to submit a separate filing with the 
Commission pursuant to Section 19(b)(1) to propose fees for the 
Liquidity Taker Event Report.
    \4\ The term ``Member'' means an individual or organization 
approved to exercise the trading rights associated with a Trading 
Permit. Members are deemed ``members'' under the Exchange Act. See 
Exchange Rule 100.
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    Members generally would use a liquidity accessing order if there is 
a high probability that it will execute against an order resting on the 
Exchange's Book.\5\ The proposed Report would identify by how much time 
an order that may have been marketable missed an execution. The 
proposed Report will provide greater visibility into the missed trading 
execution, which will allow Members to optimize their models and 
trading patterns to yield better execution results.
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    \5\ The term ``Book'' means the electronic book of buy and sell 
orders and quotes maintained by the System. See Exchange Rule 100. 
The term ``System'' means the automated trading system used by the 
Exchange for the trading of securities. See id.
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    The proposed Report will be a Member-specific report and will help 
Members to better understand by how much time a particular order missed 
executing against a specific resting order, thus allowing that Member 
to determine whether it wants to invest in the necessary resources and 
technology to mitigate missed executions against certain resting orders 
on the Exchange's Book. For example, Member A submits an order that is 
posted to the Book and then Member B enters a marketable order to 
execute against Member A's resting order. Immediately thereafter, 
Member C sends a marketable order to execute against Member A's resting 
Order. Because Member B's order is received by the Exchange before 
Member C's order, Member B's order executes against Member A's resting 
order. The proposed Report would provide Member C the data points 
necessary for that firm to calculate by how much time they missed 
executing against Member A's resting order. The Exchange proposes to 
provide the Report on a T+1 basis. As further described below, the 
Report will be specific and tailored to the Member that is subscribed 
to the Report and any data included in the Report that relates to a 
Member other than the Member receiving the Report will be anonymized.
    The Exchange proposes to provide the Report in response to Member 
demand for data concerning the timeliness of their incoming orders and 
executions against resting orders. Members have periodically requested 
from the Exchange's trading operations personnel information concerning 
the timeliness of their incoming orders and efficacy of their attempts 
to execute against resting liquidity on the Exchange's Book. The 
purpose of the Report is to provide Members the necessary data in a 
standardized format on a T+1 basis to those that subscribe to the 
Report on an equal basis.\6\
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    \6\ The proposed Report is based on a similar report provided by 
the NASDAQ Stock Market LLC (``NASDAQ'') for equity securities 
called the Missed Opportunity--Latency report as part of its NASDAQ 
Trader Insights offering. See NASDAQ Equity Section 7, Rule 
146(a)(2). See also Securities Exchange Act Release No. 78886 
(September 20, 2016), 81 FR 66113 (September 26, 2016) (SR-NASDAQ-
2016-101) (Order Granting Approval of Proposed Rule Change, as 
Modified by Amendment Nos. 1 and 2, To Add NASDAQ Rule 7046 (Nasdaq 
Trading Insights)) (``NASDAQ Approval Order''). NASDAQ later 
renumbered Rule 7046 as Equity Section 7, Rule 146. See Securities 
Exchange Act Release No. 84684 (November 29, 2018), 83 FR 62936 
(December 6, 2018) (SR-NASDAQ-2018-098). See also the CME Group, 
Inc.'s Time and Sale report. https://www.cmegroup.com/trading/about-
time-sales.html#:~:text=CME%20Globex%20Options)-, 
CME%20Group's%20Time%20% 26%20Sales%20report%20provides%20the% 
20price%20and%20time,calendar%20date)%20of%20the%20transaction.&text=
A%20zero%20volume%20represents%20an%20indicative%20price.,-
The%20Indicator%20column.
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    Proposed Exchange Rule 531(a) would provide that the Report is a 
daily report that provides a Member (``Recipient Member'') with its 
liquidity response

[[Page 15760]]

time details for executions of an order resting on the Book, where that 
Recipient Member attempted to execute against such resting order within 
a certain timeframe.
Report Content
    Paragraph (a)(1) of Rule 531 would describe the content of the 
Report and delineate which information would be provided regarding the 
resting order,\7\ the response that successfully executed against the 
resting order, and the response submitted by the Recipient Member that 
missed executing against the resting order. It is important to note 
that the content of the Report will be specific to the Recipient Member 
and the Report will not include any information related to any Member 
other than the Recipient Member. The Exchange will restrict all other 
market participants, including the Recipient Member, from receiving 
another market participant's data.
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    \7\ Only displayed orders will be included in the Report. The 
Exchange notes that it does not currently offer any non-displayed 
orders types on its options trading platform.
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    Resting Order Information. Rule 531(a)(1)(i) would provide that the 
following information would be included in the Report regarding the 
resting order: (A) the time the resting order was received by the 
Exchange; \8\ (B) symbol; \9\ (C) order reference number, which is a 
unique reference number assigned to a new order at the time of receipt; 
\10\ (D) whether the Recipient Member is an Affiliate \11\ of the 
Member that entered the resting order; \12\ (E) origin type (e.g., 
Priority Customer,\13\ Market Maker \14\); (F) side (buy or sell); \15\ 
and (G) displayed price and size of the resting order.\16\
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    \8\ This information is also included in the NASDAQ report. See 
Nasdaq Approval Order at note 12, supra note 6. The time the 
Exchange received the resting order would be in nanoseconds and is 
the time the resting order was received by the Exchange's System.
    \9\ This information is also included in the NASDAQ report. See 
id.
    \10\ This information is also included in the NASDAQ report. See 
id.
    \11\ The term ``affiliate'' of or person ``affiliated with'' 
another person means a person who, directly, or indirectly, 
controls, is controlled by, or is under common control with, such 
other person. See Exchange Rule 100.
    \12\ The Report will simply indicate whether the Recipient 
Member is Affiliate of the Member that entered the resting order and 
not include any other information that may indicate the identity of 
the Member that entered the resting order.
    \13\ The term ``Priority Customer'' means a person or entity 
that (i) is not a broker or dealer in securities, and (ii) does not 
place more than 390 orders in listed options per day on average 
during a calendar month for its own beneficial account(s). The 
number of orders shall be counted in accordance with Interpretation 
and Policy .01 to Exchange Rule 100. See Exchange Rule 100.
    \14\ The term ``Market Maker'' refers to ``Lead Market Makers'', 
``Primary Lead Market Makers'' and ``Registered Market Makers'' 
collectively. See Exchange Rule 100.
    \15\ This information is also included in the NASDAQ report. See 
Nasdaq Approval Order at note 12, supra note 6.
    \16\ This information is also included in the NASDAQ Report. See 
id. The Exchange notes that the displayed price and size are also 
disseminated via the Exchange's proprietary data feeds and the 
Options Price Reporting Authority (``OPRA''). The Exchange also 
notes that the displayed price of the resting order may be different 
than the ultimate execution price. This may occur when a resting 
order is displayed and ranked at different prices upon entry to 
avoid a locked or crossed market.
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    Execution Information. Rule 531(a)(1)(ii) would provide that the 
following information would be included in the Report regarding the 
execution of the resting order: (A) the EBBO \17\ at the time of 
execution; \18\ (B) the ABBO \19\ at the time of execution; \20\ (C) 
the time first response that executes against the resting order was 
received by the Exchange and the size of the execution and type of the 
response; \21\ (D) the time difference between the time the resting 
order was received by the Exchange and the time the first response that 
executes against the resting order was received by the Exchange; \22\ 
and (E) whether the response was entered by the Recipient Member. If 
the resting order executes against multiple contra-side responses, only 
the EBBO and ABBO at the time of the execution against the first 
response will be included.
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    \17\ The term ``EBBO'' means the best bid or offer on the 
Exchange. See Exchange Rule 100.
    \18\ Exchange Rule 531(a)(1)(ii)(B) would further provide that 
if the resting order executes against multiple contra-side 
responses, only the EBBO [sic] at the time of the execution against 
the first response will be included.
    \19\ The term ``ABBO'' or ``Away Best Bid or Offer'' means the 
best bid(s) or offer(s) disseminated by other Eligible Exchanges 
(defined in Exchange Rule 1400(g)) and calculated by the Exchange 
based on market information received by the Exchange from OPRA. See 
Exchange Rule 100.
    \20\ Exchange Rule 531(a)(1)(ii)(A) would further provide that 
if the resting order executes against multiple contra-side 
responses, only the ABBO [sic] at the time of the execution against 
the first response will be included.
    \21\ This information is also included in the NASDAQ report. See 
Nasdaq Approval Order at note 12, supra note 6. The time the 
Exchange received the response order would be in nanoseconds and 
would be the time the response was received by the Exchange's 
network, which is before the time the response would be received by 
the System.
    \22\ The time difference would be provided in nanoseconds. This 
information is also included in the NASDAQ report. See Nasdaq 
Approval Order at note 12, supra note 6.
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    Recipient Member's Response Information. Rule 531(a)(1)(iii) would 
provide that the following information would be included in the Report 
regarding response(s) sent by the Recipient Member: (A) Recipient 
Member identifier; (B) the time difference between the time the first 
response that executes against the resting order was received by the 
Exchange and the time of each response sent by the Recipient Member, 
regardless of whether it executed or not; \23\ (C) size and type of 
each response submitted by Recipient Member; and (D) response reference 
number, which is a unique reference number attached to the response by 
the Recipient Member.
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    \23\ This information is also included in the NASDAQ report. See 
Nasdaq Approval Order at note 12, supra note 6. For purposes of 
calculating this duration of time, the Exchange will use the time 
the resting order and the Recipient Member's response(s) is received 
by the Exchange's network, both of which would be before the order 
and response(s) would be received by the System. This time 
difference would be provided in nanoseconds.
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Timeframe for Data Included in Report
    Paragraph (a)(2) of Rule 531 would provide that the Report would 
include the data set forth under Rule 531(a)(1) described above for 
executions and contra-side responses that occurred within 200 
microseconds of the time the resting order was received by the 
Exchange.
Scope of Data Included in the Report
    Paragraph (a)(3) of Rule 531 would provide that the Report will 
only include trading data related to the Recipient Member and, subject 
to the proposed paragraph (4) of Rule 531(a) described below, will not 
include any other Member's trading data other than that listed in 
paragraphs (1)(i) and (ii) of Exchange Rule 531(a) described above.\24\
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    \24\ The scope of information included in the Report is similar 
to the NASDAQ report in that both NASDAQ's report and the proposed 
Report do not include information related to the any Member other 
than the Recipient Member. See Nasdaq Approval Order at note 13, 
supra note 6.
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Historical Data
    Paragraph (a)(4) of Rule 531 would specify that the Report will 
contain historical data from the prior trading day and will be 
available after the end of the trading day, generally on a T+1 basis.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\25\ Specifically, the Exchange believes the proposed rule change 
is consistent with the Section 6(b)(5) \26\ requirements that the rules 
of an exchange be designed to prevent

[[Page 15761]]

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. This proposal is in keeping 
with those principles in that it promotes increased transparency 
through the dissemination of the optional Report to those interested in 
subscribing to receive the data. Additionally, the Exchange believes 
the proposed rule change is consistent with the Section 6(b)(5) \27\ 
requirement that the rules of an exchange not be designed to permit 
unfair discrimination between customers, issuers, brokers, or dealers.
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    \25\ 15 U.S.C. 78f(b).
    \26\ 15 U.S.C. 78f(b)(5).
    \27\ Id.
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    The Exchange believes the proposed Report will serve to promote 
just and equitable principles of trade, remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general protect investors and the public interest 
because it will benefit investors by facilitating their prompt access 
to the value added information that is included in the proposed Report. 
The Report will allow Members to access information regarding their 
trading activity that they may utilize to evaluate their own trading 
behavior and order interactions.
    The proposed Report is designed for Members that are interested in 
gaining insight into latency in connection with orders that failed to 
execute against an order resting on the Exchange's Book by providing 
those Members data to analyze by how much time their order may have 
missed an execution against a contra-side order resting on the Book. 
The Exchange believes that providing this optional latency data to 
interested Members is consistent with facilitating transactions in 
securities, removing impediments to and perfecting the mechanism of a 
free and open market and a national market system, and, in general, 
protecting investors and the public interest because it provides 
greater visibility into the latency of Members' incoming orders. 
Members may use this data to optimize their models and trading patterns 
in an effort to yield better execution results by calculating by how 
much time their order may have missed an execution.
    The Report generally contains three buckets of information. The 
first two buckets include information about the resting order and the 
execution of the resting order. This information is generally available 
from other public sources, such as OPRA and the Exchange's proprietary 
data feeds, or is similar to information included in a report offered 
by another exchange. For example, OPRA provides bids, offers, and 
consolidated last sale and quotation information for options trading on 
all national securities exchanges, including the Exchange. In addition, 
the Exchange offers the Top of Market (``ToM'') feed which provides 
real-time quote and last sale information for all displayed orders on 
the Book.\28\
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    \28\ See Securities Exchange Release 79913 (February 1, 2017), 
82 FR 9617 (February 7, 2017) (Notice of Filing and Immediate 
Effectiveness of a Proposed Rule Change to Establish the MIAX PEARL 
Top of Market (``ToM'') and MIAX PEARL Liquidity Feed (``PLF'') Data 
Products).
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    Specifically, the first bucket of information contained in the 
Report for the resting order includes the time the resting order was 
received by the Exchange, the symbol, unique reference number assigned 
at the time of receipt, side (buy or sell), and the displayed price and 
size of the resting order. Each of these data points are also included 
in the report of another exchange that was previously approved by the 
Commission.\29\ Further, the symbol, origin type, side (buy or sell), 
and displayed price and size are also available either via OPRA or the 
Exchange's proprietary data feeds. The first bucket of information also 
indicates whether the Recipient Member is an Affiliate of the Member 
that entered the resting order. This data field will not indicate the 
identity of the Member that entered the resting order and would simply 
allow the Recipient Member to better understand the scenarios in which 
it may execute against the orders of its Affiliates.\30\
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    \29\ This information is also included in the NASDAQ report. See 
Nasdaq Approval Order at note 12, supra note 6.
    \30\ The Exchange's surveils to monitor for abhorrent behavior 
related to internalized trades and identify potential wash sales.
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    The second bucket of information contained in the Report regards 
the execution of the resting order and includes the EBBO and ABBO at 
the time of execution. These data points are also available either via 
OPRA or the Exchange's proprietary data feeds. The second bucket of 
information will also indicate whether the response was entered by the 
Recipient Member. This data point is simply provided as a convenience. 
If not entered by the Recipient Member, this data point will be left 
blank so as not to include any identifying information about other 
Member activity. The second bucket of information also includes the 
size, time and type of first response that executes against the resting 
order; as well as the time difference between the time the resting 
order and first response that executes against the resting order are 
received by the Exchange. These data points would assist the Recipient 
Member in analyzing by how much time their order may have missed an 
execution against a contra-side order resting on the Book. These data 
points are also included in the report of another exchange that was 
previously approved by the Commission.\31\
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    \31\ This information is also included in the NASDAQ report. See 
Nasdaq Approval Order at note 12, supra note 6.
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    The third bucket of information is about the Recipient Member's 
response(s) and the time their response(s) is received by the Exchange. 
This includes the time difference between the time the first response 
that executes against the resting order was received by the Exchange 
and the time of each response sent by the Recipient Member, regardless 
of whether it executed or not. As above, this data point would assist 
the Recipient Member in analyzing by how much time their order may have 
missed an execution against a contra-side order resting on the Book. 
This data point is also included in the report of another exchange that 
was previously approved by the Commission.\32\ This bucket would also 
include the size and type of each response submitted by the Recipient 
Member, the Recipient Member identifier, and a response reference 
number which is selected by the Recipient Member. Each of these data 
point are unique to the Recipient Member and should already be known by 
Recipient Member even if not included in the Report.
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    \32\ This information is also included in the NASDAQ report. See 
Nasdaq Approval Order at note 12, supra note 6.
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    As mentioned above, at least one other exchange currently offers a 
similar trading related report that has been reviewed and approved by 
the Commission. Specifically, NASDAQ provides the Missed Opportunity--
Latency report as part of its NASDAQ Trader Insights offering.\33\ 
NASDAQ's Missed Opportunity--Latency report, like the proposed Report, 
identifies by how much time a marketable order missed executing against 
a resting order, similar to the third bucket of information provided in 
the Report and described above. Both the proposed Report and NASDAQ's 
Missed Opportunity--Latency report are both

[[Page 15762]]

provided on a T+1 basis and include data specific to one Member, and 
only that Member would receive the report.\34\ In addition, both the 
proposed Report and NASDAQ's Missed Opportunity--Latency report are 
intended to provide the Recipient Member with the time duration by 
which the order entered by the Recipient Member missed an execution. 
Both the Exchange and NASDAQ restrict all other market participants, 
including the Recipient Member, from receiving another market 
participant's data. As described above throughout the proposal, the 
proposed Report and NASDAQ's Missed Opportunity--Latency report both 
include the following information:
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    \33\ See NASDAQ Approval Order supra note 6.
    \34\ Id.

 The time a resting order was received by the Exchange
 Symbol
 Order reference number (unique reference number assigned to a 
new order at the time of receipt)
 Side (buy or sell)
 Displayed price and size of the resting order
 Time first response that executes against the resting order 
was received by the Exchange and the size of the execution and type of 
the response
 Time difference between the time the resting order was 
received by the Exchange and the time the first response that executes 
against the resting order was received by the Exchange
 Time difference between the time the first response that 
executes against the resting order was received by the Exchange and the 
time of each response sent by the Recipient Member, regardless of 
whether it executed or not

    The proposed Report includes that following information that is not 
included in NASDAQ's Missed Opportunity--Latency report:
 Whether the Recipient Member is an Affiliate of the Member 
that entered the resting order.
 Origin type (e.g., Priority Customer, Market Maker). This 
difference is immaterial as this data point is being provided as a 
convenience and this data point is also available either via OPRA or 
the Exchange's proprietary data feeds.
 EBBO at the time of the execution. This difference is 
immaterial as this data point is being provided as a convenience and 
this data point is also available either via OPRA or the Exchange's 
proprietary data feeds.
 ABBO at the time of the execution. This difference is 
immaterial as this data point is being provided as a convenience and 
this data point is also available either via OPRA or the Exchange's 
proprietary data feeds.
 Whether response was entered by the Recipient Member. As 
stated above, this data point is simply provided as a convenience to 
the Recipient Member. If not entered by the Recipient Member, this data 
point will be left blank so as not to include any identifying 
information about other Member activity.
 Recipient Member identifier. This difference is not material 
because this data point is being provided as a convenience would [sic] 
be known to the Recipient Member even if not included in the Report.
 Size and type of each response submitted by the Recipient 
Member. This difference is not material because this data point is 
being provided as a convenience would [sic] be known to the Recipient 
Member even if not included in the Report.
 Response reference number. The Exchange believe [sic] this is 
not a material difference since it this [sic] is a unique reference 
number not assigned by the Exchange, but rather attached to response 
[sic] by the Recipient Member themselves and would be known to the 
Recipient Member even if not included in the Report.
    As illustrated above, the proposed Report and NASDAQ's Missed 
Opportunity--Latency Report is substantially similar and includes a 
number of the same data elements designed to assist Members in better 
understanding their trading activity on the Exchange and augment their 
trading strategies to improve their execution opportunities. Each of 
these above differences are immaterial because the data point is 
available via another source and is being provided as a convenience to 
the Recipient Member when analyzing the Report and intended to make the 
Report more comprehensive and easier to understand.
    One additional difference between the proposed Report and NASDAQ's 
Missed Opportunity--Latency report is unrelated to the content of the 
Report, but is related to the type of security the report covers. The 
proposed Report would cover options trading on the Exchange while 
NASDAQ's Missed Opportunity--Latency report covers equity securities. 
The Exchange believes this difference is of no consequence as both 
reports are intended to serve the same purpose--providing firms with an 
opportunity to learn more about when they may have better opportunities 
to access liquidity and to receive better execution rates. The 
infrastructure by which a market participant seek to access displayed 
liquidity on either an equity or options exchange is similar. Liquidity 
seeking orders on both equity and options exchanges would access the 
exchanges' systems in similar manners through the use of ports and 
gateways. Both reports provide data regarding attempts to access 
liquidity and both reports would be of no value to market participants 
seeking to access liquidity in dark pools or other off-exchange venues 
that are present in the equities market that do not provide for 
displayed orders. Such off exchange venues are not present in the 
options markets. The value of such a report is only present in the 
displayed markets for both options and equities trading and, therefore, 
the Exchange believes the proposed Report presents the same utility and 
benefits in the options market as the NASDAQ report does today for 
equities.
    In approving NASDAQ's Missed Opportunity--Latency report, the 
Commission noted that the report ``would increase transparency, 
particularly for Members who may not have the expertise to generate the 
same information.'' \35\ For the reasons stated above, the Exchange 
believes this statement is true regardless of whether the Recipient 
Member trades equities or options. The Exchange's proposed Report would 
achieve the same goal for Members seeking to better understand the 
efficacy of their incoming orders. Further, the proposed Report 
promotes just and equitable principles of trade because, like NASDAQ's 
report, it will increase transparency and democratize information so 
that all firms may elect to subscribe to the Report even though some 
firms may not have the appropriate resources to generate a similar 
report themselves.
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    \35\ See Securities Exchange Act Release No. 78886 (September 
20, 2016), 81 FR 66113, 66114 (September 26, 2016).
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    The Exchange proposes to provide the Report on a voluntary basis 
and no Member will be required to subscribe to the Report. The Exchange 
notes that there is no rule or regulation that requires the Exchange to 
produce, or that a Member elect to receive, the Report. It is entirely 
a business decision of each Member to subscribe to the Report. The 
Exchange proposes to offer the Report as a convenience to Members to 
provide them with additional information regarding trading activity on 
the Exchange on a delayed basis after the close of regular trading 
hours. A Member that chooses to subscribe to the Report may discontinue 
receiving the

[[Page 15763]]

Report at any time if that Member determines that the information 
contained in the Report is no longer useful.
    In summary, the proposed Report will help to protect a free and 
open market by providing additional data (offered on an optional basis) 
to the marketplace and by providing investors with greater choices.\36\ 
Additionally, the proposal would not permit unfair discrimination 
because the proposed Report will be available to all Exchange Members.
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    \36\ See Sec. Indus. Fin. Mkts. Ass'n (SIFMA), Initial Decision 
Release No. 1015, 2016 SEC LEXIS 2278 (ALJ June 1, 2016) (finding 
the existence of vigorous competition with respect to non-core 
market data).
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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 
result in any burden on competition that is not necessary or 
appropriate in furtherance of the purposes of the Act, as amended. The 
Exchange believes that the proposed Report will enhance competition 
\37\ by providing a new option for receiving market data to Members. 
The proposed Report will also further enhance competition between 
exchanges by allowing the Exchange to expand its product offerings to 
include a report similar to that currently offered by NASDAQ.\38\
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    \37\ Id.
    \38\ See NASDAQ Equity Section 7, Rule 146(a)(2).
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    In this instance, the proposed rule change to offer the optional 
Report is in response to Member interest and requests for such 
information. The Exchange does not believe the proposed Report will 
have an inappropriate burden on intra-market competition between 
Recipient Members and other Members who do not receive the Report. As 
discussed above, the first two buckets of information included in the 
Report contain information about the resting order and the execution of 
the resting order, both of which are generally available to Members 
that chose not to receive the Report from other public sources, such as 
OPRA and the Exchange's proprietary data feeds. The third bucket of 
information is about the Recipient Member's response and the time their 
response is received by the Exchange, information which the Recipient 
Member would be able to obtain without receiving the Report. 
Additionally, some Members may already be able to derive a substantial 
amount of the same data that is provided by some of the components 
based on their own executions and algorithms.
    In sum, if the proposed Report is unattractive to Members, Members 
will opt not to receive it. Accordingly, the Exchange does not believe 
that the proposed change will impair the ability of Members or 
competing order execution venues to maintain their competitive standing 
in the financial markets.

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

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the Exchange consents, the Commission shall: (a) By order approve 
or disapprove such proposed rule change, or (b) institute proceedings 
to determine whether the proposed rule change should be 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-EMERALD-2021-09 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-EMERALD-2021-09. 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-EMERALD-2021-09, and should be submitted 
on or before April 14, 2021.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\39\
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    \39\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2021-05998 Filed 3-23-21; 8:45 am]
BILLING CODE 8011-01-P