[Federal Register Volume 88, Number 30 (Tuesday, February 14, 2023)]
[Notices]
[Pages 9543-9548]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-03057]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-96837; File No. SR-PEARL-2023-01]


Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend Exchange 
Rule 531, Reports and Market Data Products, To Provide for the New 
``Liquidity Taker Event Report--Resting Simple Orders''

February 8, 2023.
    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 January 25, 2023, MIAX PEARL, LLC (``MIAX 
Pearl'' or the ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') a 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 is filing a proposal to amend Exchange Rule 531 to 
provide for the new ``Liquidity Taker Event Report--Resting Simple 
Orders''.
    The text of the proposed rule change is available on the Exchange's 
website at http://www.miaxoptions.com/rule-filings/pearl at MIAX 
Pearl'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

[[Page 9544]]

forth in sections A, B, and C below, of the most significant aspects of 
such statements.

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

1. Purpose
    The Exchange proposes to amend Exchange Rule 531 to provide for the 
new ``Liquidity Taker Event Report--Resting Simple Orders'' (the 
``Report'').\3\ The proposed Report will be an optional product \4\ 
available to Members.\5\ Currently, the Exchange provides two types of 
Liquidity Taker Event Reports, one including information about incoming 
orders seeking to remove liquidity from the Simple Order Book \6\ 
described under Exchange Rule 531(a), and a second including the same 
information but about incoming Complex Orders that seek to remove 
Complex Orders resting on the Strategy Book \7\ described under 
Exchange Rule 531(b). Both of these existing reports provide data for 
executions and contra-side responses that occurred within 200 
microseconds of the time the resting order was received by the 
Exchange. But for the modified timeframe and one difference described 
below, the proposed Report would include the same data as the Liquidity 
Taker Event Report for Simple Orders but would focus on executions and 
contra-side responses that occurred after 200 microseconds of the time 
the resting order was received by the Exchange and within 200 
microseconds of receipt of the first attempt to execute against the 
resting order after the initial 200 microsecond time period has expired 
as described further below.
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    \3\ The proposed rule change is identical to proposal to adopt 
the same report by the Exchange's affiliate, MIAX Emerald, LLC 
recently filed with the Commission for immediate effectiveness. See 
SR-EMERALD-2023-02 (filed January 18, 2023).
    \4\ 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--Resting Simple Orders.
    \5\ 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.
    \6\ The term ``Simple Order Book'' means ``the Exchange's 
regular electronic book of orders and quotes.'' See Exchange Rule 
518(a)(15).
    \7\ The term ``Complex Strategy'' means ``a particular 
combination of components and their ratios to one another. New 
complex strategies can be created as the result of the receipt of a 
complex order or by the Exchange for a complex strategy that is not 
currently in the System.'' See Exchange Rule 518(a)(6). The term 
``Strategy Book'' means the Exchange's electronic book of complex 
orders and complex quotes. See Exchange Rule 518(a)(17). The 
Strategy Book is organized by Complex Strategy in that individual 
orders for a defined Complex Strategy are organized together in a 
book that is separate from the orders for a different Complex 
Strategy.
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    Like for the existing reports, the Exchange believes the additional 
data points from the matching engine outlined below for the proposed 
Report may also help Members gain a better understanding about their 
interactions with the Exchange. The Exchange believes the proposed 
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. Like the existing reports, none of the 
components of the proposed Report include real-time market data.
    Members generally would use a liquidity accessing order if there is 
a high probability that it will execute against an order resting on the 
Simple Order Book. Like the existing reports, the proposed Report would 
identify by how much time an order that may have been marketable missed 
an execution but would focus on a later timeframe than the existing 
reports. 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.
    Like the existing reports, 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 Simple Order Book. 
Like the existing reports, the Exchange proposes to provide the Report 
on a T+1 basis. As further described below, the proposed 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 proposed Report in response to 
additional Member demand for data concerning the timeliness of their 
incoming orders and executions against certain resting orders that have 
been resting on the Simple Order Book for at least 200 microseconds and 
within 200 microseconds of receipt of the first attempt to execute 
against the resting order after the initial 200 microsecond time period 
has expired. Certain Members that subscribe to the existing reports 
have requested the same information as the Simple Order report but for 
the later timeframe described herein so that they can better understand 
the timeliness of their incoming orders and efficacy of their attempts 
to execute against resting liquidity on the Exchange's Simple Order 
Book. The purpose of the proposed 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.
    Proposed Exchange Rule 531(c) would provide that the Report is a 
daily report that provides a Member (``Recipient Member'') with its 
liquidity response time details for executions of an order resting on 
the Book, where that Recipient Member attempted to execute against such 
resting order within an extended timeframe that meets certain criteria 
described below.\8\
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    \8\ The Exchange proposes to renumber current Exchange Rule 
531(c), Market Data Products, as Exchange Rule 531(d). The Exchange 
does not propose to amend the rule text of this rule.
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Report Content
    The content of the proposed Report is basically identical to that 
of the existing Liquidity Taker Event Report for Simple Orders 
described under Exchange Rule 531(a) with two differences. The first 
difference is the timeframe of the proposed Report mentioned above and 
described in more detail below. The second difference is that, unlike 
the existing Liquidity Taker Event Report for Simple Orders, the 
proposed Report would not include 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. Each of these differences are described below. All other 
aspects of the proposed Report are identical to the existing Liquidity 
Taker Event Report for Simple Orders described under Exchange Rule 
531(a).
    Like current paragraph (a)(1) of Exchange Rule 531 for the existing 
Liquidity Taker Event Report for Simple Orders, proposed paragraph 
(c)(1) of Rule 531 would describe the content of the proposed Report 
and delineate which information would be provided regarding the resting 
order,\9\ the

[[Page 9545]]

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, other than certain information about the resting 
order described below. The Exchange will restrict all other market 
participants, including the Recipient Member, from receiving another 
market participant's data.
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    \9\ 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. Like current paragraph (a)(1)(i) of 
Exchange Rule 531 for the existing Liquidity Taker Event Report for 
Simple Orders, proposed Exchange Rule 531(c)(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; \10\ (B) symbol; (C) order reference number, which is a 
unique reference number assigned to a new order at the time of receipt; 
(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); and (G) 
displayed price and size of the resting order.\15\
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    \10\ 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.
    \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 an 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\ 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. Like current paragraph (a)(1)(ii) of 
Exchange Rule 531 for the existing Liquidity Taker Event Report for 
Simple Orders, proposed Exchange Rule 531(c)(1)(ii) would provide that 
the following information would be included in the Report regarding the 
execution of the resting order: (A) the PBBO \16\ at the time of 
execution; \17\ (B) the ABBO \18\ at the time of execution; \19\ (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; \20\ and (D) whether the response was entered by the 
Recipient Member. If the resting order executes against multiple 
contra-side responses, only the PBBO and ABBO at the time of the 
execution against the first response will be included.
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    \16\ The term ``PBBO'' means the best bid or offer on the 
Exchange. See Exchange Rule 100.
    \17\ Exchange Rule 531(c)(1)(ii)(A) would further provide that 
if the resting order executes against multiple contra-side 
responses, only the PBBO at the time of the execution against the 
first response will be included.
    \18\ 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.
    \19\ Exchange Rule 531(c)(1)(ii)(B) would further provide that 
if the resting order executes against multiple contra-side 
responses, only the ABBO at the time of the execution against the 
first response will be included.
    \20\ 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.
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    Exchange Rule 531(a)(1)(ii)(D) provides that the existing Liquidity 
Taker Event Report for Simple Orders also includes 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. The proposed Report would not include the 
same information because that timeframe could be for an extended period 
of time since the proposed Report focuses on orders that have been 
resting on the Simple Order Book for longer than 200 microseconds and, 
therefore, the Exchange believes is less likely to be valuable to the 
Recipient Member.
    Recipient Member's Response Information. Like current paragraph 
(a)(1)(iii) of Exchange Rule 531 for the existing Liquidity Taker Event 
Report for Simple Orders, proposed Rule 531(c)(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; \21\ (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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    \21\ 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
    The timeframe covered by the proposed Report is the primary 
difference between it and the existing Liquidity Taker Event Report for 
Simple Orders. The existing Liquidity Taker Event Report for Simple 
Orders provides data for executions and contra-side responses that 
occurred within 200 microseconds of the time the resting order was 
received by the Exchange. Meanwhile, the proposed Report would include 
the same data as the Liquidity Taker Event Report for Simple Orders but 
would focus on executions and contra-side responses that occurred after 
200 microseconds of the time the resting order was received by the 
Exchange, and within 200 microseconds of receipt of any Member's first 
attempt to execute against the resting order after the initial 200 
microsecond time period has expired. More specifically, the resting 
order must rest on the Simple Order Book for at least 200 microseconds 
and once that initial 200 microsecond period has passed, a Member must 
then submits an order to attempt to execute against that resting order. 
This event starts a second 200 microsecond period within which the 
proposed Report would include data on executions and contra-side 
responses submitted by the Recipient Member to execute against that 
resting order.
    For example, Member A submits an order that is posted to the Simple 
Order Book. 200 microseconds passes and Member A's order remains posted 
to the Simple Order Book. Then Member B enters a marketable order to 
execute against Member A's resting order, starting the second 200 
microsecond window. Within this next 200 microsecond window, 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

[[Page 9546]]

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 above timeframe would be codified under proposed paragraph 
(c)(2) of Rule 531 which would provide that the proposed Report would 
include the data set forth under Rule 531(c)(1) described above for 
executions and contra-side responses that occurred (i) after 200 
microseconds of the time the resting order was received by the Exchange 
and (ii) within 200 microseconds of receipt of the first attempt to 
execute against the resting order after the initial 200 microsecond 
time period under (c)(2)(i) of this paragraph has expired.
Scope of Data Included in the Report
    Like current paragraph (a)(3) of Exchange Rule 531 for the existing 
Liquidity Taker Event Report for Simple Orders, proposed paragraph 
(c)(3) of Exchange Rule 531 would provide that the proposed Report will 
only include trading data related to the Recipient Member and, subject 
to the proposed paragraph (4) of Rule 531(c) 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(c) described above.
Historical Data
    Like current paragraph (a)(4) of Exchange Rule 531 for the existing 
Liquidity Taker Event Report for Simple Orders, proposed paragraph 
(c)(4) of Rule 531 would specify that the proposed 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.\22\ Specifically, the Exchange believes the proposed rule change 
is consistent with the Section 6(b)(5) \23\ requirements that the rules 
of an exchange be 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 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) \24\ requirement that the rules of an exchange not be 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
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    \22\ 15 U.S.C. 78f(b).
    \23\ 15 U.S.C. 78f(b)(5).
    \24\ Id.
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    The timeframe covered by the proposed Report is the primary 
difference between it and the existing Liquidity Taker Event Report for 
Simple Orders. However, this difference only pertains to the timeframe 
covered by each report, with each report containing the exact same data 
fields with one exception described here. The existing Liquidity Taker 
Event Report for Simple Orders provides data for executions and contra-
side responses that occurred within 200 microseconds of the time the 
resting order was received by the Exchange. Meanwhile, the proposed 
Report would basically include the same data as the Liquidity Taker 
Event Report for Simple Orders but would focus on executions and 
contra-side responses that occurred after 200 microseconds of the time 
the resting order was received by the Exchange and one additional 
difference. The one difference is that unlike the existing Liquidity 
Taker Event Report for Simple Orders, the proposed Report would not 
include the time difference between the time the resting order and 
first response that executes against the resting order are received by 
the Exchange. Each report focuses on 200 microsecond windows with the 
existing Report's window starting at the time of receipt of the resting 
order and the proposed Report's window starting with the first attempt 
to execute against the resting order after the order was resting on the 
Simple Order Book for at least 200 microseconds.
    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 proposed Report will allow Members to access information regarding 
their trading activity that they may utilize to evaluate their own 
trading behavior and order interactions.
    Like the existing Liquidity Taker Event Report for Simple Orders, 
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 Simple Order 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.
    Like the existing Liquidity Taker Event Report for Simple Orders, 
the proposed Report is designed to offer latency information in a 
systematized way and standardized format to any Member that chooses to 
subscribe to the proposed Report. As a result, the proposal will make 
latency information for liquidity-seeking orders available in an 
equalized manner and will increase transparency, particularly for 
Recipient Members that may not have the expertise to generate the same 
information on their own. The proposed Report may better enable 
Recipient Members to increase the fill rates for their liquidity-
seeking orders. At the same time, as is also discussed above, the 
Report is designed to prevent a Recipient Member from learning other 
Members' sensitive trading information. The Report would not be a real-
time market data product, as it would provide only historical trading 
data for the previous trading day, generally on a T+1 basis. In 
addition, the data in the Report regarding incoming orders that failed 
to execute would be specific to the Recipient Member's orders, and 
other information in the proposed Report regarding resting orders and 
executions would be anonymized if it relates to a Member other than the 
Recipient Member.
    The proposed Report generally contains three buckets of 
information,

[[Page 9547]]

each of which are identical to the same buckets of information 
contained in the existing Liquidity Taker Event Report for Simple 
Orders, with one exception discussed herein and again below. 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.\25\
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    \25\ See Section 6(a) of the Exchange's fee schedule.
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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. 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.\26\
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    \26\ 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 PBBO 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, as well as the time and type of first response that executes 
against the resting order. 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. Unlike the 
existing Liquidity Taker Event Report for Simple Orders, the proposed 
Report would not include the time difference between the time the 
resting order and first response that executes against the resting 
order are received by the Exchange. The proposed Report would not 
include this data point because the Exchange understands Recipient 
Members may not find it useful due to the fact that the proposed Report 
focuses on orders that have been resting on the Simple Order Book for 
longer than 200 microseconds. Therefore, the Exchange does not propose 
to include this data point as a means to streamline the proposed Report 
and remove unnecessary data.
    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 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 points are unique to the Recipient Member and should 
already be known by Recipient Member even if not included in the 
Report.
    Like the existing Liquidity Taker Event Report for Simple Orders, 
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 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.\27\ 
Additionally, the proposal would not permit unfair discrimination 
because the proposed Report will be available to all Exchange Members.
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    \27\ 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 
\28\ 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 an additional report to provide latency information requested 
by Members.
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    \28\ Id.
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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, including from some Members that subscribe to the existing 
Liquidity Taker Event Report for Simple Orders. 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 choose 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.

[[Page 9548]]

    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

    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 after the date of the filing, or such 
shorter time as the Commission may designate, it has become effective 
pursuant to 19(b)(3)(A) of the Act \29\ and Rule 19b-4(f)(6) \30\ 
thereunder.
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    \29\ 15 U.S.C. 78s(b)(3)(A).
    \30\ 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 [email protected]. Please include 
File Number SR-PEARL-2023-01 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-PEARL-2023-01. 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-PEARL-2023-01, and should be submitted 
on or before March 7, 2023.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\31\
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    \31\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-03057 Filed 2-13-23; 8:45 am]
BILLING CODE 8011-01-P


