[Federal Register Volume 83, Number 6 (Tuesday, January 9, 2018)]
[Notices]
[Pages 1058-1062]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-00160]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82437; File No. SR-CboeEDGX-2017-009]


Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change To 
Adopt Risk Controls and Modify Rules 21.1, 21.10, and 21.17 in 
Connection With Technology Migration of Cboe Exchanges

January 3, 2018.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on December 21, 2017, Cboe EDGX Exchange, Inc. (the ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I and II below, which Items 
have been prepared by the Exchange. The Exchange has designated this 
proposal as a ``non-controversial'' proposed rule change pursuant to 
Section 19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(6)(iii) 
thereunder,\4\ which renders it effective upon filing with the 
Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to update Rule 21.1, Rule 21.10, and 
Rule 21.17 to make modifications to the Exchange's rules and 
functionality applicable to the Exchange's options platform (``EDGX 
Options'') in preparation for the technology migration of the 
Exchange's affiliated options exchanges onto the same technology as the 
Exchange.
    The text of the proposed rule change is available at the Exchange's 
website at www.markets.cboe.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 parts of such 
statements.

(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    In 2016, the Exchange and its affiliates Cboe BYX Exchange, Inc. 
(``BYX''), Cboe EDGA Exchange, Inc. (``EDGA''), and Cboe BZX Exchange, 
Inc. (``BZX'') received approval to affect a merger (the ``Merger'') of 
the Exchange's then-current indirect parent company, Bats Global 
Markets, Inc., with Cboe Global Markets f/k/a CBOE Holdings, Inc. 
(``Cboe''), the direct parent of Cboe Exchange, Inc. (``Cboe Options'') 
and Cboe C2 Exchange, Inc. (``C2 Options'', and together with the 
Exchange, BZX, and Cboe Options the ``Cboe Affiliated Exchanges'').\5\ 
The Cboe Affiliated Exchanges are working to align certain system 
functionality, retaining only intended differences between the Cboe 
Affiliated Exchanges,

[[Page 1059]]

in the context of a technology migration. Thus, the proposals set forth 
below are intended to add certain functionality to the Exchange's 
System \6\ that is more similar to functionality offered by Cboe 
Options and C2 Options in order to ultimately provide a consistent 
technology offering for market participants who interact with the Cboe 
Affiliated Exchanges. Although the Exchange intentionally offers 
certain features that differ from those offered by its affiliates and 
will continue to do so, the Exchange believes that offering similar 
functionality to the extent practicable will reduce potential confusion 
for Users.
---------------------------------------------------------------------------

    \5\ See Securities Exchange Act Release No. 79585 (December 16, 
2016), 81 FR 93988 (December 22, 2016) (SR-BatsBZX-2016-68; SR-
BatsBYX-2016-29; SR-BatsEDGA-2016-24; SR-BatsEDGX-2016-60). The 
Exchange notes that BYX and EDGA are also affiliated exchanges but 
do not operate options platforms and thus the integration described 
in this proposal is inapplicable to such exchanges.
    \6\ The ``System'' is the automated trading system used by EDGX 
Options for the trading of options contracts. See Rule 16.1(a)(59).
---------------------------------------------------------------------------

    The Exchange is proposing to adopt periodic but relatively minor 
changes to functionality in order to reduce risk in connection with the 
technology migration described above; this proposal is related to two 
such proposed changes. First, the Exchange proposes to adopt certain 
risk functionality in Rule 21.17, which is based on functionality on 
Cboe Options, C2 Options and/or the Exchange's functionality applicable 
to complex orders. The Exchange notes that it also proposes to make a 
related change to Rule 21.1 to eliminate functionality that overlaps 
with the proposed risk functionality. Second, the Exchange proposes to 
modify Rule 21.10 to allow it to provide additional information on 
transaction reports.
Risk Controls
    The Exchange currently provides certain controls to Users \7\ of 
EDGX Options pursuant to Rule 21.16, which describes the Exchange's 
``Risk Monitor Mechanism,'' and Rule 21.20, which describes the 
Exchange's functionality for complex orders. In addition, the Exchange 
provides a variety of optional risk controls to all Exchange Users 
pursuant to Interpretation and Policy .01 to Rule 11.10, including 
various controls related to the price of an order.\8\ The Exchange 
proposes to adopt various risk controls currently offered by Cboe 
Options, C2 Options, and/or the Exchange with respect to complex orders 
and to codify such risk controls in Rule 21.17.
---------------------------------------------------------------------------

    \7\ The term ``User'' means any Options Member or Sponsored 
Participant who is authorized to obtain access to the Exchange's 
System (as defined below) pursuant to Rule 11.3. See Rule 
16.1(a)(63).
    \8\ See Rule 11.10, Interpretation and Policy .01; see also 
Securities Exchange Act Release No. 67266 (June 26, 2012), 77 FR 
39300 (July 2, 2012) (SR-EDGX-2012-21) (Notice of Filing and 
Immediate Effectiveness of Proposed Rule Change Relating to New 
Market Access Risk Management Service).
---------------------------------------------------------------------------

    Rule 21.17 currently permits the Exchange to share a User's risk 
settings with the Clearing Member that clears transactions on behalf of 
the User, which is a provision that the Exchange does not propose to 
modify. Rule 21.17 does not currently describe any applicable risk 
settings. As noted above, though certain risk settings offered for 
Users of EDGX Options are codified in Rule 21.16, other optional risk 
settings offered by the Exchange are more generally described in 
Interpretation and Policy .01 to Rule 11.10 and have been described in 
other filings previously made by the Exchange.\9\ The Exchange proposes 
to provide more specificity in proposed Rule 21.17 regarding the risk 
settings the Exchange proposes to implement for EDGX Options, which is 
consistent with the approach taken by Cboe Options and C2 Options.
---------------------------------------------------------------------------

    \9\ See id.
---------------------------------------------------------------------------

    As a general matter, the Exchange proposes to adopt various numeric 
values that would apply to the risk settings offered by the Exchange. 
Consistent with other rules of the Exchange,\10\ the Exchange proposes 
to maintain all numeric values established by the Exchange pursuant to 
Rule 21.17 in publicly available specifications and/or published in a 
Regulatory Circular. Further, as a general matter, the proposed risk 
settings would be applied to all orders and quotes received by EDGX 
Options rather than optionally configured and enabled by Users. Thus, 
proposed Rule 21.17 would explicitly state that unless otherwise 
specified, the price protections in the Rule, including the numeric 
values established by the Exchange, may not be disabled or adjusted. 
Below are descriptions of the specific risk settings proposed by the 
Exchange.
---------------------------------------------------------------------------

    \10\ See, e.g., Interpretation and Policies .04(c)(1), .04(e), 
.04(f) and .06 to Rule 21.20, which refer to various risk control 
values offered by the Exchange with respect to complex orders that 
are communicated to members of the Exchange via specifications and/
or Regulatory Circular.
---------------------------------------------------------------------------

    The first risk control the Exchange proposes to adopt is the Market 
Order NBBO Width Protection. As proposed, if a User submits a Market 
Order \11\ to the System when the NBBO \12\ width is greater than x% of 
the midpoint of the NBBO, subject to minimum and maximum dollar values 
established by the Exchange, the System will reject or cancel back to 
the User the Market Order. The Exchange proposes to establish ``x'' and 
the minimum and maximum values on a class-by-class basis. The proposed 
Market Order NBBO Width Protection is based on and similar to the 
Market-Width Parameter set forth in C2 Options Rule 6.17(a)(1).\13\ In 
particular, similar to C2 Options Rule 6.17(a)(1), the Exchange would 
reject or cancel Market Orders when the width of the NBBO is greater 
than an acceptable range and would establish the numeric values that 
would ultimately determine acceptable quote widths on a class-by-class 
basis. However, in contrast to C2 Options Rule 6.17(a)(1), the Exchange 
does not propose to set forth specific boundaries for quote widths 
within the proposed rule. The Exchange believes that it needs 
flexibility to modify acceptable quote widths based on experience with 
the risk control and Users would always have access to the applicable 
settings in the Exchange's publicly available specifications and/or as 
published in a Regulatory Circular. The Exchange notes that the Nasdaq 
Options Market (``NOM'') has a similar quote width protection in place 
for market orders that does not specify the applicable limits within 
the rule.\14\ The Exchange notes that it does not currently have an 
NBBO width protection in place for Market Orders, and thus this 
protection is an additive control to protect against erroneous 
executions.
---------------------------------------------------------------------------

    \11\ See Rule 21.1(d)(5).
    \12\ As defined in Rule 16.1(a)(29), the term ``NBB'' means the 
national best bid, the term ``NBO'' means the national best offer, 
and the term ``NBBO'' means the national best bid or offer as 
calculated by EDGX Options based on market information received by 
EDGX Options from OPRA.
    \13\ The Exchange notes that identical or similar rules 
regarding risk controls offered by C2 Options are also provided in 
the rules of Cboe Options and on other options exchanges. However, 
the Exchange has focused on the Rules of C2 Options as well as the 
Exchange's own rules applicable to complex orders for purposes of 
this proposal.
    \14\ See NOM Chapter VI, Section 6(c), which describes the NOM 
Market Order Spread Protection and states that ``System Orders that 
are Market Orders will be rejected if the best of the NBBO and the 
internal market BBO (the ``Reference BBO'') is wider than a preset 
threshold at the time the order is received by the System.''
---------------------------------------------------------------------------

    The second risk control the Exchange proposes to adopt is the Limit 
Order Fat Finger Check. As proposed, if a User submits a buy (sell) 
limit order to the System with a price that is more than a buffer 
amount established by the Exchange above (below) the NBO (NBB), or, in 
the case of an order received prior to 9:30 a.m., above (below) the 
midpoint of the NBBO at the close of the market on the previous trading 
day, the System will reject or cancel back to the User the limit order. 
The proposed Limit Order Fat Finger Check is based on and similar to 
certain Limit Order Price Parameters set forth in C2 Options Rule 
6.17(b). In particular, similar to C2 Options Rule 6.17(b)(1) and 
(b)(2), the Exchange would reject or cancel limit orders that

[[Page 1060]]

are more than an acceptable difference from the applicable reference 
price and would distinguish the applicable reference price depending on 
whether an order was received prior to market open or during the 
trading day. However, in contrast to C2 Options Rule 6.17(b), which 
states that the acceptable tick distance shall be no less than two 
minimum increment ticks for simple orders, the Exchange does not 
propose to set forth specific boundaries for the acceptable difference 
within the proposed rule. As is true for the Market Order NBBO Width 
Protection described above, the Exchange believes that it needs 
flexibility to modify the acceptable price range based on experience 
with the risk control and Users would always have access to the 
applicable settings in the Exchange's publicly available specifications 
and/or as published in a Regulatory Circular. The Exchange notes that 
the BOX Options Exchange (``BOX'') has a similar price protection in 
place for limit orders that does specify potential percentages in the 
Rule but also permits BOX to modify such percentages via Information 
Circular without establishing outer boundaries.\15\ The Exchange notes 
that it currently applies mandatory fat finger protection to complex 
orders received by the Exchange pursuant to Interpretation and Policy 
.06 to Rule 21.20. The Exchange also notes that it currently offers 
price protections analogous to the proposed Limit Order Fat Finger 
Check for orders other than complex orders (i.e., ``simple orders''), 
however, as noted above such price protections are optional.
---------------------------------------------------------------------------

    \15\ See BOX Rule 7290, which describes the Price Protection for 
Limit Orders and Quotes and states that ``[t]he price parameter is 
set by either the Exchange or the Participant on an underlying 
security basis and is a percentage of the NBBO on the opposite side 
of the incoming order or quote. Unless determined otherwise by the 
Exchange and announced to Participants via Informational Circular, 
the specified percentage shall be: 100% for the contra-side NBB or 
NBO priced at or below $0.25; and 50% for the contraside NBB or NBO 
priced above $0.25.''
---------------------------------------------------------------------------

    The third risk control the Exchange proposes to adopt is the Buy 
Order Put Check. As proposed, if a User enters a buy limit order for a 
put with a price that is higher than or equal to the strike price of 
the option, the System will reject or cancel back to the User the limit 
order. Similarly, if a User enters a buy Market Order for a put that 
would execute at (or the remaining portion would execute at) a price 
higher than or equal to the strike price of the option, the System will 
reject or cancel back to the User the Market Order (or remaining 
portion). The Exchange does not propose to apply this check to adjusted 
options. The proposed Buy Order Put Check is based on and substantively 
identical to the Put Strike Price Value Check set forth in C2 Options 
Rule 6.17(d)(1)(A). The Exchange notes that it does not currently have 
an analogous risk control in place, and thus, this protection is an 
additive control to protect against erroneous executions.
    The fourth and final risk control the Exchange proposes to adopt is 
the Drill-Through Price Protection. As proposed, the Drill-Through 
Price Protection feature is a price protection mechanism applicable to 
all orders under which a buy (sell) order will not be executed at a 
price that is higher (lower) than the NBO (NBB) at the time of order 
entry plus (minus) a buffer amount established by the Exchange (the 
``Drill-Through Price''). If a buy (sell) order would execute or post 
to the EDGX Options Book at a price higher (lower) than the Drill-
Through Price, the System will instead post the order to the EDGX 
Options Book at the Drill-Through Price, unless the terms of the order 
instruct otherwise. Any order (or unexecuted portion thereof) will rest 
in the EDGX Options Book (based on the time at which it enters the book 
for priority purposes) for a time period in milliseconds that may not 
exceed three seconds with a price equal to the Drill-Through Price. If 
the order (or unexecuted portion thereof) does not execute during that 
time period, the System will cancel it. While similar to and based on 
C2 Options Rule 6.17(a)(2), the proposed Rule is more directly based on 
Interpretation and Policy .04, to Exchange Rule 21.20, which describes 
Drill-Through Price Protection applicable to complex orders on EDGX 
Options. The proposed Drill-Through Price Protection is identical to 
Interpretation and Policy .04 to Rule 21.20 with the exceptions of 
necessary differences between language related to simple orders and 
complex orders and that in contrast to a User being able to modify the 
protection to a more or less restrictive control, which is available 
for the control on the Exchange for complex orders, the Exchange 
proposes to apply standard Drill-Through Price Protection to all orders 
and such protection cannot be modified.
    In connection with the changes described above, the Exchange 
proposes to remove a portion of the definition of a [sic] Market Orders 
to remove a risk protection currently in place that overlaps with 
various risk controls described above. Market Orders are currently 
defined in in Rule 21.1(d)(5) as ``orders to buy or sell at the best 
price available at the time of execution.'' Rule 21.1(d)(5) further 
states that ``[a]ny portion of a Market Order that would execute at a 
price more than $0.50 or 5 percent worse than the NBBO at the time the 
order initially reaches EDGX Options, whichever is greater, will be 
cancelled.'' The Exchange proposes to remove this price protection for 
Market Orders because it is no longer necessary in light of the 
proposed risk controls described above (other than the Limit Order Fat 
Finger Check, which is inapplicable to Market Orders). In particular, 
the Drill-Through Price Protection provides a control with respect to 
the execution prices of Market Orders and would be duplicative of the 
existing control.
Details in Transaction Reports
    The Exchange also proposes to modify Rule 21.10, Anonymity, to 
allow it to provide additional information on transaction reports. 
Current Rule 21.10(a) states that ``[t]he intra-day transaction reports 
produced by the System will indicate the details of the transactions, 
and shall not reveal contra party identities.'' The Exchange notes that 
this provision is consistent with Rule 11.13(d) of its cash equities 
trading platform (``EDGX Equities'') but is not a common provision in 
the rules of other options exchanges, including Cboe Options or C2 
Options, which do not have such a provision. The Exchange currently 
provides details regarding contra-parties on various end of day and end 
of month reports for clearing purposes, and this information is 
similarly readily available through the Options Clearing Corporation 
(``OCC'') for clearing purposes.
    The Exchange proposes to remove the restriction on providing contra 
party identities and to specifically state that aggregated and 
individual transaction reports produced by the System will indicate the 
details of a User's transactions, including the contra party's MPID, 
capacity, and clearing firm account number.
    Current paragraph (c) of Rule 21.10 contains four exceptions to the 
general rule of anonymity, providing that the ``Exchange shall reveal a 
User's identity in the following circumstances: (1) For regulatory 
purposes or to comply with an order of an arbitrator or court; (2) if 
both Users to the transaction consent; (3) if a User is acting as 
either a Market Maker or sending Orders on behalf of a Priority 
Customer; or (4) unless otherwise instructed by a User, the Exchange 
will reveal to a User, no later than the end of the day on the date an 
anonymous trade was executed, when the User's Order has been 
decremented by another Order submitted by that same User.'' The 
Exchange proposes to

[[Page 1061]]

retain only the first exception, regarding regulatory purposes or to 
comply with an order of an arbitrator or court, as the other exceptions 
are no longer necessary to the extent the Exchange will provide 
information on individual and aggregate transaction reports produced by 
the System.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \16\ in general, and furthers the objectives of Section 
6(b)(5) of the Act \17\ 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. In particular, consistent rules and functionality between the 
Exchange and its affiliated exchanges will reduce complexity and help 
avoid potential confusion by the Users of the Exchange that are also 
participants on other Cboe Affiliated Exchanges.\18\
---------------------------------------------------------------------------

    \16\ 15 U.S.C. 78f(b).
    \17\ 15 U.S.C. 78f(b)(5).
    \18\ The Exchange notes that its affiliate, BZX, also intends to 
adopt changes that are substantively identical to the changes set 
forth in this proposal. In addition, as Cboe Options and C2 Options 
migrate to the same technology platform as the Exchange, Cboe 
Options and C2 Options intend to modify rules and functionality to 
be consistent with the Exchange and BZX, unless the retention of 
differences is intended.
---------------------------------------------------------------------------

    The Exchange believes the proposed amendment will reduce complexity 
and increase the understanding of the Exchange's operations for all 
Users of the Exchange. In particular, by adopting certain mandatory 
risk controls, the Exchange's functionality will be more similar to 
that of Cboe Options and C2 Options. In turn, when Cboe Options and C2 
Options are migrated to the same technology as that of the Exchange, 
Users of the Exchange and other Cboe Affiliated Exchanges will have 
access to similar functionality on all Cboe Affiliated Exchanges. As 
such, the proposed rule change would foster cooperation and 
coordination with persons engaged in facilitating transactions in 
securities and would remove impediments to and perfect the mechanism of 
a free and open market and a national market system.
    The Exchange further believes that the proposed price protection 
mechanisms and risk controls will protect investors and the public 
interest and maintain fair and orderly markets by mitigating potential 
risks associated with market participants entering orders and quotes at 
unintended prices, and risks associated with orders and quotes trading 
at prices that are extreme and potentially erroneous, which may likely 
have resulted from human or operational error. While the Exchange has 
previously offered many risk controls under Interpretation and Policy 
.01 to Rule 11.10 and other filings previously made by the 
Exchange,\19\ the Exchange believes that Users will benefit from the 
additional specificity provided under the proposed rules, particularly 
because, in contrast to optional risk control functionality, the 
proposed rules provide that each proposed risk control will be applied 
to all orders received by EDGX Options. Although the Exchange's 
proposed price protection mechanisms and risk controls are similar to 
and based on existing rules of C2 Options or the Exchange, the Exchange 
notes that it has not proposed to establish outer boundaries or limits 
to the levels at which the mechanisms can be set. The Exchange believes 
this is reasonable and is necessary to afford the Exchange the 
flexibility to establish and modify the default parameters in order to 
protect investors and the public interest and maintain a fair and 
orderly market. The Exchange again notes that the applicable specified 
levels will always be available in the Exchange's publicly available 
specifications and/or as published in a Regulatory Circular. The 
Exchange also notes that this approach is consistent with certain rules 
of other options exchanges, which similarly offer risk controls that 
can be modified without regard to a rule based limitation.\20\
---------------------------------------------------------------------------

    \19\ See supra, note 7.
    \20\ See supra, notes 13 and 14.
---------------------------------------------------------------------------

    The Exchange believes the proposed changes to Rule 21.10 that will 
permit the Exchange to provide additional detail in transaction reports 
is consistent with the rules of other options exchanges that do not 
contain explicit restrictions on providing such information. The 
proposed changes are similarly consistent with a variety of current 
Exchange and options industry practices, including the fact that 
clearing information available through OCC already provides contra-
party information, as well as the ability of a User on the Exchange to 
disclose their identity when quoting.\21\ Based on the foregoing, the 
Exchange believes the proposed changes to Rule 21.10 are consistent 
with Section 6(b)(5) of the Act \22\ in particular, in that they are 
designed to foster cooperation and coordination with persons engaged in 
clearing, settling, processing information with respect to, and 
facilitating transactions in securities.
---------------------------------------------------------------------------

    \21\ See, e.g., Rule 21.1(c)(1), defining ``Attributable 
Orders'' as orders that are designated for display (price and size) 
including the User's market participant identifier (``MPID'').
    \22\ 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. The Exchange notes that the 
proposal will further promote consistency between the Exchange and its 
affiliated exchanges, and is part of a larger technology integration 
that will ultimately reduce complexity for Users of the Exchange that 
are also participants on other Cboe Affiliated Exchanges. The Exchange 
does not believe that the proposed changes will have any direct impact 
on competition. Thus, the Exchange does not believe that the proposal 
creates any significant impact on competition.

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

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any written comments from members or other interested parties.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (A) 
Significantly affect the protection of investors or the public 
interest; (B) impose any significant burden on competition; and (C) by 
its terms, 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 \23\ and 
paragraph (f)(6) of Rule 19b-4 thereunder,\24\ the Exchange has 
designated this rule filing as non-controversial. The Exchange has 
given 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.
---------------------------------------------------------------------------

    \23\ 15 U.S.C. 78s(b)(3)(A).
    \24\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \25\ normally 
does not become operative prior to 30 days after

[[Page 1062]]

the date of the filing. However, Rule 19b-4(f)(6)(iii) \26\ 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 asked the Commission to waive the 30-day operative delay so that 
the proposal may become operative immediately upon filing. The Exchange 
notes that the proposal will promote consistency between the Exchange 
and its affiliated exchanges, and is part of a larger technology 
integration that will ultimately reduce complexity for Users of the 
Exchange that are also participants on other Cboe Affiliated Exchanges. 
The Exchange further notes that allowing the Exchange to move forward 
with the proposed changes without an operative delay will ensure that 
the technology integration can continue with periodic but measured 
changes rather than implementing several changes at once. Furthermore, 
the Exchange states that the implementation of the risk controls will 
help to avoid potentially erroneous executions. 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 as operative upon filing.\27\
---------------------------------------------------------------------------

    \25\ 17 CFR 240.19b-4(f)(6).
    \26\ 17 CFR 240.19b-4(f)(6)(iii).
    \27\ For purposes only of waiving the 30-day operative delay, 
the Commission has also 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: (1) 
Necessary or appropriate in the public interest; (2) for the protection 
of investors; or (3) 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-CboeEDGX-2017-009 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields, 
Secretary, Securities and Exchange Commission, 100 F Street NE, 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-CboeEDGX-2017-009. 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-CboeEDGX-2017-009 and should be 
submitted on or before January 30, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\28\
---------------------------------------------------------------------------

    \28\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-00160 Filed 1-8-18; 8:45 am]
 BILLING CODE 8011-01-P


