Document ID: SEC-2019-0896-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Nasdaq MRX, LLC
Posted Date: 2019-06-24T04:00Z

[Federal Register Volume 84, Number 121 (Monday, June 24, 2019)]
[Notices]
[Pages 29551-29552]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-13308]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-86132; File No. SR-MRX-2019-11]

Self-Regulatory Organizations; Nasdaq MRX, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Make Non-
Substantive, Clarifying Changes to Options 7

June 18, 2019.
    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 June 5, 2019, Nasdaq MRX, LLC (``MRX'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``SEC'' or ``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 make non-substantive, clarifying changes 
to Options 7, as described further below.
    The text of the proposed rule change is available on the Exchange's 
website at http://nasdaqmrx.cchwallstreet.com/, at the principal office 
of the Exchange, and at the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant 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 make non-substantive 
clarifications to the Exchange's Pricing Schedule in Options 7 to avoid 
potential confusion in the Exchange's rules.
    First, the Exchange proposes to remove an obsolete reference to its 
old website in its Options 7, Section 1. The definition of ``Penny 
Symbols'' presently states that the current list of Nasdaq MRX-listed 
Penny Pilot Program symbols is available at http://www.ise.com/assets/files/products/productstraded/options_product_equityDownload.csv. Now 
that the legacy website is no longer available, the Exchange proposes 
to delete this sentence from the definition of Penny Symbols.
    Second, the Exchange proposes to add references to average daily 
volume (``ADV'') to certain pricing for Price Improvement Mechanism 
(``PIM'') orders set forth in Options 7, Section 3, Table 2. 
Specifically, the Exchange proposes to clarify that the current volume 
threshold requirements for the reduced contra-side Fee for Crossing 
Orders \3\ of $0.02 per contract in all symbols and the rebate for 
originating Priority Customer \4\ PIM orders of $1.05 in Non-Penny 
Symbols are each ADV calculations. Although the Exchange has always 
calculated these volume thresholds based on executed ADV of PIM 
originating contracts, the Exchange believes that explicitly adding the 
word ``ADV'' to this rule will avoid any possible confusion among 
members.\5\ The Exchange also proposes to delete the words ``per day'' 
in each place it proposes to add ``ADV'' to avoid redundancy.
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    \3\ A ``Crossing Order'' is an order executed in the Exchange's 
Facilitation Mechanism, Solicited Order Mechanism, PIM or submitted 
as a Qualified Contingent Cross order. For purposes of this Pricing 
Schedule, orders executed in the Block Order Mechanism are also 
considered Crossing Orders.
    \4\ A ``Priority Customer'' is a person or entity that is not a 
broker/dealer in securities, and does not place more than 390 orders 
in listed options per day on average during a calendar month for its 
own beneficial account(s), as defined in Nasdaq MRX Rule 
100(a)(37A).
    \5\ In the filing to adopt the PIM pricing and related volume 
thresholds, the Exchange stated that the reduced PIM fee is 
calculated by averaging volume across the month per business day. 
See Securities Exchange Act Release No. 85313 (March 14, 2019), 84 
FR 10357 (March 20, 2019) (SR-MRX-2019-05). The Exchange notes that 
the higher PIM rebate, which is based on the same volume threshold 
as reduced the PIM fee, is calculated in the same manner.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\6\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\7\ in particular, in that it is designed to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general to protect investors and the public interest.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
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    As discussed above, the Exchange seeks to make non-substantive 
changes to Options 7 by removing obsolete references to its legacy 
website and specifying that certain PIM pricing is based on ADV 
calculations. The Exchange believes that the proposed changes herein 
will add further clarification to its Pricing Schedule, and will also 
alleviate potential confusion as to the applicability of the Exchange's 
rules, all of which will protect investors and the public interest. 
Furthermore, as

[[Page 29552]]

it relates to the clarifications proposed above for PIM pricing in 
Options 7, Section 3, Table 2, to add ``ADV'' and relatedly, delete 
``per day,'' the Exchange notes that this is not a change to its 
current practice, but is a simple clean up change to make the Pricing 
Schedule easier for members to understand.\8\ For the foregoing 
reasons, the Exchange believes that its proposal is consistent with the 
Act.
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    \8\ See supra note 5.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. As discussed above, the 
proposed changes are non-substantive changes, and are merely intended 
add further clarification to the Exchange's Pricing Schedule and 
alleviate potential confusion.

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)(iii) of the Act \9\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \10\ 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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-MRX-2019-11 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-MRX-2019-11. 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-MRX-2019-11 and should be submitted on 
or before July 15, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Vanessa A. Countryman,
Acting Secretary.
[FR Doc. 2019-13308 Filed 6-21-19; 8:45 am]
 BILLING CODE 8011-01-P