[Federal Register Volume 80, Number 125 (Tuesday, June 30, 2015)]
[Notices]
[Pages 37349-37351]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-15981]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-75284; File No. SR-MIAX-2015-40]
Self-Regulatory Organizations; Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Amend Exchange Rule 510 To Extend the Penny
Pilot Program
June 24, 2015.
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 June 18, 2015, Miami International Securities
Exchange LLC (``MIAX'' or ``Exchange'') filed with the Securities and
Exchange Commission (``Commission'') a 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.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange is filing a proposal to amend Rule 510,
Interpretations and Policies .01 to extend the pilot program for the
quoting and trading of certain options in pennies (the ``Penny Pilot
Program'').
The text of the proposed rule change is available on the Exchange's
Web site at http://www.miaxoptions.com/filter/wotitle/rule_filing, at
MIAX'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 is a participant in an industry-wide pilot program
that provides for the quoting and trading of certain option classes in
penny increments (the ``Penny Pilot Program'' or ``Program'').
Specifically, the Penny Pilot Program allows the quoting and trading of
certain option classes in minimum increments of $0.01 for all series in
such option classes with a price of less than $3.00; and in minimum
increments of $0.05 for all series in such option classes with a price
of $3.00 or higher. Options overlying the PowerShares QQQ Trust
(``QQQQ'')[supreg], SPDR S&P 500 Exchange Traded Funds (``SPY''), and
iShares Russell 2000 Index Funds (``IWM''), however, are quoted and
traded in minimum increments of $0.01 for all series regardless of the
price. The Penny Pilot Program was initiated at the then existing
option exchanges in January 2007 and currently includes more than 300
of the most active option classes. The Penny Pilot Program is currently
scheduled to expire on June 30, 2015. The purpose of the proposed rule
change is to extend the Penny Pilot Program in its current format
through June 30, 2016.
In addition to the extension of the Penny Pilot Program through
June 30, 2016, the Exchange will replace any Penny Pilot issues that
have been delisted with the next most actively traded multiply listed
option classes that are not yet included in the Penny Pilot Program.
The replacement issues will be selected based on trading activity in
the previous six months and will be added to the Penny Pilot Program on
the second trading day following July 1, 2015 and January 1, 2016.
Please note, the month immediately preceding a replacement
[[Page 37350]]
class's addition to the Pilot program (i.e., June) will not be used for
purposes of the six-month analysis. Thus, a replacement added on the
second trading day following July 1, 2015 will be identified based on
trading activity from December 1, 2014 through May 31, 2015. Similarly,
a replacement added on the second trading day following January 1, 2016
will be identified based on trading activity from June 1, 2015 through
November 30, 2015. Rule 510 has been updated to reflect the new date
replacement issues will be added to the Penny Pilot Program.
2. Statutory Basis
MIAX believes that its proposed rule change is consistent with
Section 6(b) of the Act \3\ in general, and furthers the objectives of
Section 6(b)(5) of the Act \4\ in particular, in that 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 facilitating transactions in
securities, to remove impediments to and perfect the mechanisms of a
free and open market and a national market system and, in general, to
protect investors and the public interest. In particular, the proposed
rule change, which extends the Penny Pilot Program for six months,
allows the Exchange to continue to participate in a program that has
been viewed as beneficial to traders, investors and public customers
and viewed as successful by the other options exchanges participating
in it.
---------------------------------------------------------------------------
\3\ 15 U.S.C. 78f(b).
\4\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
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. Specifically, the Exchange
believes that, by extending the expiration of the Pilot Program, the
proposed rule change will allow for further analysis of the Penny Pilot
Program and a determination of how the Program should be structured in
the future. In doing so, the proposed rule change will also serve to
promote regulatory clarity and consistency, thereby reducing burdens on
the marketplace and facilitating investor protection. In addition,
consistent with previous practices, the Exchange believes the other
options exchanges will be filing similar extensions of the Penny Pilot
Program.
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 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, the proposed rule change has become effective
pursuant to Section 19(b)(3)(A) of the Act \5\ and Rule 19b-4(f)(6)
thereunder.\6\
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78s(b)(3)(A).
\6\ 17 CFR 240.19b-4(f)(6). As required under Rule 19b-
4(f)(6)(iii), the Exchange provided the Commission with written
notice of its intent to file the proposed rule change, along with a
brief description and the 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.
---------------------------------------------------------------------------
A proposed rule change filed under Rule 19b-4(f)(6) \7\ normally
does not become operative prior to 30 days after the date of the
filing.\8\ However, pursuant to Rule 19b-4(f)(6)(iii),\9\ the
Commission may designate a shorter time if such action is consistent
with the protection of investors and the public interest. The Exchange
has asked the Commission to waive the 30-day operative delay so that
the proposal may become operative immediately upon filing. The
Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest
because doing so will allow the Penny Pilot Program to continue without
interruption in a manner that is consistent with the Commission's prior
approval of the extension and expansion of the Penny Pilot Program and
will allow the Exchange and the Commission additional time to analyze
the impact of the Penny Pilot Program.\10\ Accordingly, the Commission
designates the proposed rule change as operative upon filing with the
Commission.\11\
---------------------------------------------------------------------------
\7\ 17 CFR 240.19b-4(f)(6).
\8\ 17 CFR 240.19b-4(f)(6).
\9\ 17 CFR 240.19b-4(f)(6)(iii).
\10\ See Securities Exchange Act Release No. 61061 (November 24,
2009), 74 FR 62857 (December 1, 2009) (SR-NYSEArca-2009-44).
\11\ For purposes only of waiving the operative delay for this
proposal, the Commission has considered the proposed rule's impact
on efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------
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 [email protected]. Please include
File Number SR-MIAX-2015-40 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-MIAX-2015-40. 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 Web site (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 Web site 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; the Commission does
not edit personal identifying information from
[[Page 37351]]
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File Number SR-
MIAX-2015-40 and should be submitted on or before July 21, 2015.
---------------------------------------------------------------------------
\12\ 17 CFR 200.30-3(a)(12).'
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-15981 Filed 6-29-15; 8:45 am]
BILLING CODE 8011-01-P