2021-01403. Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the BX Options Pricing Schedule  

  • Start Preamble January 15, 2021.

    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),[1] and Rule 19b-4 thereunder,[2] notice is hereby given that on January 4, 2021, Nasdaq BX, Inc. (“BX” 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.

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

    The Exchange proposes to amend the BX Options Pricing Schedule at Options 7.

    The text of the proposed rule change is available on the Exchange's website at https://listingcenter.nasdaq.com/​rulebook/​bx/​rules,, 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

    Today, Lead Market Makers (“LMMs”) [3] are assessed the same fees and rebates in Options 7, Section 2 as BX Options Market Makers.[4] The purpose of the proposed rule change is to amend Options 7, Section 2 to (i) increase the LMM Rebate to Add Liquidity, (ii) decrease the LMM Fee to Add Liquidity, and (iii) restructure the existing pricing schedules to add separate pricing for LMMs, which will apply in each case to LMMs in their specifically appointed options classes. As described in detail below, while the Exchange is proposing to add separate pricing for LMMs in the existing schedules, LMMs will continue to be assessed the same BX Options Market Makers fees and rebates in their specifically allocated options classes under this proposal except with respect to the proposed LMM Rebate to Add Liquidity and proposed LMM Fee to Add Liquidity. The Exchange also proposes to amend its Opening Cross [5] pricing provisions in Options 7, Section 2(2) to correct an inadvertent omission. Lastly, the Exchange proposes various technical, non-substantive changes throughout Options 7, including to update cross-cites to obsolete rules.

    The proposed changes respond in part to the current competitive environment where market participants have a choice of where to direct order flow by incentivizing LMMs to increase their liquidity provision on the Exchange.

    LMM Rebate To Add Liquidity

    Today, as set forth in Options 7, Section 2(1), LMMs are provided the $0.10 per contract BX Options Market Maker Rebate to Add Liquidity in Penny Symbols in their specifically allocated options classes. This rebate is provided only when the LMM is contra to a Non-Customer,[6] Firm,[7] or BX Options Market Maker (including LMMs).[8]

    The Exchange now proposes to increase this rebate to $0.11 per contract for LMMs only. This rebate will apply to LMMs in their specifically allocated options classes, and will have the same qualifications as the existing BX Options Market Maker rebate in that the incentive will only be provided to LMMs that are contra to Non-Customers, Firms, BX Options Market Makers, or LMMs. To effect this change, the Exchange proposes to set forth the LMM Rebate to Add Liquidity in Penny Symbols in a separate pricing column in Options 7, Section 2(1). The Exchange will also amend the rebate qualifications in note 2 of Options 7, Section 2(1) to include LMMs. As amended, note 2 will provide that the Rebate to Add Liquidity will be paid to a BX Options Market Maker or a Lead Market Maker only when the BX Options Market Maker or Lead Market Maker is contra to a Non-Customer, Firm, BX Options Market Maker, or Lead Market Maker.

    LMM Fee To Add Liquidity

    Today, as set forth in Options 7, Section 2(1), LMMs are charged the $0.39 per contract BX Options Market Maker Fee to Add Liquidity in Penny Symbols in their specifically allocated options classes. Pursuant to note 3 of Options 7, Section 2(1), this fee is assessed only when the LMM is contra to a Customer.[9]

    The Exchange now proposes to decrease this fee to $0.38 per contract for LMMs only. This fee will apply to LMMs in their specifically allocated options classes, and will have the same qualifications as the existing BX Options Market Maker fee in that the fee only will be assessed to LMMs that are contra to Customers. To effect this change, the Exchange proposes to set forth the LMM Fee to Add Liquidity in Penny Symbols in a separate pricing column in Options 7, Section 2(1). The Exchange will also amend the fee qualifications in note 3 of Options 7, Section 2(1) to include LMMs. As amended, note 3 will provide that the Fee to Add Liquidity will be assessed to a BX Options Market Maker or a Lead Start Printed Page 6701Market Maker only when the BX Options Market Maker or Lead Market Maker is contra to a Customer.

    Separate LMM Pricing

    The Exchange also proposes to restructure the existing pricing schedules to add separate pricing for LMMs. As noted above, while the Exchange is proposing to add separate pricing for LMMs, LMMs will continue to be assessed the same BX Options Market Makers fees and rebates in their specifically allocated options classes under this proposal except with respect to the new LMM Rebate to Add Liquidity and new LMM Fee to Add Liquidity discussed above.

    To effect this change, the Exchange first proposes to amend the fees and rebates for Penny and Non-Penny Symbols in Options 7, Section 2(1) by adding a separate column for LMM pricing. In the Penny Symbol and Non-Penny Symbol Tier Schedules within Options 7, Section 2(1), the Exchange also proposes to add LMMs next to each instance of BX Options Market Maker. The Exchange will make similar changes to note 4 of Options 7, Section 2(1) to add “or a Lead Market Maker” after each instance of BX Options Market Maker. As amended, the pricing schedules and accompanying notes for Penny and Non-Penny Symbols will be as follows:

    Fees and Rebates

    [Per executed contract]

    CustomerLead market makerBX options market makerNon- customer 1Firm
    Penny Symbols:
    Rebate to Add Liquidity#2 $0.112 $0.10N/AN/A
    Fee to Add Liquidity#3 0.383 0.390.450.45
    Rebate to Remove Liquidity#N/AN/AN/AN/A
    Fee to Remove LiquidityN/A##0.460.46
    Non-Penny Symbols:
    Rebate to Add Liquidity*N/AN/AN/AN/A
    Fee to Add Liquidity*4 0.50/0.954 0.50/0.950.980.98
    Rebate to Remove Liquidity*N/AN/AN/AN/A
    Fee to Remove LiquidityN/A**0.890.89
    1 A Non-Customer includes a Professional, Broker-Dealer and Non-BX Options Market Maker.
    2 The Rebate to Add Liquidity will be paid to a BX Options Market Maker or a Lead Market Maker only when the BX Options Market Maker or Lead Market Maker is contra to a Non-Customer, Firm, BX Options Market Maker, or Lead Market Maker.
    3 The Fee to Add Liquidity will be assessed to a BX Options Market Maker or a Lead Market Maker only when the BX Options Market Maker or Lead Market Maker is contra to a Customer.
    4 The higher Fee to Add Liquidity will be assessed to a BX Options Market Maker or a Lead Market Maker only when the BX Options Market Maker or Lead Market Maker is contra to a Customer.
    # Penny Symbols Tier Schedule
    When:Rebate to add liquidityFee to add liquidityRebate to remove liquidityFee to remove liquidityFee to remove liquidity
    Trading with:CustomerCustomerCustomerLead market maker or BX options market makerLead market maker or BX options market maker
    Non-customer, lead market maker, BX options market maker, or firmCustomerNon-customer, lead market maker, BX options market maker, customer, or firmCustomerNon-customer, lead market maker, BX options market maker, or firm
    Tier 1: Participant executes less than 0.05% of total industry customer equity and ETF option ADV contracts per month$0.00$0.39$0.00$0.39$0.46
    Tier 2: Participant executes 0.05% to less than 0.15% of total industry customer equity and ETF option ADV contracts per month0.100.390.250.390.46
    Tier 3: Participant executes 0.15% or more of total industry customer equity and ETF option ADV contracts per month0.200.390.350.300.46
    * Non-Penny Symbols Tier Schedule
    Tier 1: Participant executes less than 0.05% of total industry customer equity and ETF option ADV contracts per month0.000.850.800.890.89
    Tier 2: Participant executes 0.05% to less than 0.15% of total industry customer equity and ETF option ADV contracts per month0.100.850.800.890.89
    Start Printed Page 6702
    Tier 3: Participant executes 0.15% or more of total industry customer equity and ETF option ADV contracts per month0.200.850.800.600.89

    As shown above, the only fee changes relate to the proposed LMM Rebate to Add Liquidity in Penny Symbols and the proposed LMM Fee to Add Liquidity in Penny Symbols. Otherwise, LMMs will continue to be charged at the same rate for Penny and Non-Penny Symbols under this proposal (i.e., the same as BX Options Market Makers).

    The Exchange also proposes to make similar changes in Options 7, Section 2(4) and Section 2(5) to add separate pricing for LMMs. In Section 2(4), which sets forth pricing for orders executed in the Exchange's exposure mechanism,[10] the Exchange proposes to add a separate pricing column for LMMs that will set forth the same fees and rebates that LMMs are assessed today (i.e., the same as BX Options Market Makers). As amended, the pricing schedule for exposure orders in Section 2(4) will be as follows:

    Fees and Rebates

    [Per executed contract]

    CustomerLead market makerBX options market makerNon-customer
    Penny Symbols:
    Rebate for Order triggering order exposure alert$0.34$0.00$0.00$0.00
    Fee for Order responding to order exposure alert0.390.390.390.45
    Non-Penny Symbols
    Rebate for Order triggering order exposure alert0.700.000.000.00
    Fee for Order responding to order exposure alert0.850.850.850.89

    In Section 2(5), which sets forth pricing for orders executed in the Exchange's Price Improvement Mechanism (“PRISM”),[11] the Exchange proposes to add a separate pricing row for LMMs that will set forth the same fees and rebates that LMMs are assessed today (i.e., the same as BX Options Market Makers). As amended, the pricing schedule for PRISM orders in Section 2(5) will be as follows:

    Fees and Rebates

    [Per contact]

    Type of market participantsAgency orderSubmitted PRISM orderResponded to PRISM auctionPRISM order traded with PRISM response
    FeeFeeRebate
    Contra-side orderPenny classesNon-penny classesPenny classesNon-penny classes
    Customer$0.00$0.00$0.49$0.94$0.35$0.70
    Lead Market Maker0.300.050.490.940.000.00
    BX Options Market Maker0.300.050.490.940.000.00
    Non-Customer0.300.050.490.940.000.00

    Opening Cross

    The Exchange proposes to amend its Opening Cross pricing provisions in Options 7, Section 2(2) to correct an inadvertent omission. Specifically, the Exchange submitted a rule filing effective on July 3, 2012 to adopt fees and rebates for BX Options, which, among other things, adopted the pricing for market participants during the Opening Cross (“2012 Filing”).[12] As discussed in the 2012 Filing, BX's Start Printed Page 6703Opening Cross pricing was intended to be similar to the Opening Cross pricing on its affiliate, The Nasdaq Options Market (“NOM”), in that BX would similarly assess a Fee to Remove Liquidity on all market participants, other than a Customer, during the Opening Cross. Indeed, NOM's Pricing Schedule specifically states that “Broker-Dealers, Professionals, Firms, Non-NOM Market Makers and NOM Market Makers will be assessed the Fee for Removing Liquidity during the Exchange's Opening Cross.” [13] Accordingly, the 2012 Filing should have likewise reflected that BX Options Market Makers would be assessed the Fee to Remove Liquidity during the Exchange's Opening Cross. However, the 2012 Filing inadvertently omitted these market participants in the Exhibit 5 rule text. As a result of this drafting error, the current rule in Options 7, Section 2(2) incorrectly indicates that only Professionals, Firms, Broker-Dealers and Non-BX Options Market Makers will be assessed the Fee to Remove Liquidity during the Opening Cross. Therefore, the Exchange proposes to add that BX Options Market Makers will be assessed the Fee to Remove Liquidity during the Exchange's Opening Cross. The Exchange notes that this change is corrective in nature and does not change any rates that are currently applied to BX Options Market Makers during the Opening Cross.

    The Exchange also proposes a non-substantive change in this section to replace Professionals, Broker-Dealers, and Non-BX Options Market Makers with the term “Non-Customers,” which encompasses those market participant types. Finally, in light of the proposed changes to separately provide for LMM pricing throughout Options 7, Section 2 by adding LMMs next to each instance of BX Options Market Makers, the Exchange proposes to add LMMs to the Opening Cross pricing provisions in Section 2(2). As discussed above, LMMs are currently charged the same rates as BX Options Market Makers, including during the Opening Cross (i.e., the Fee to Remove Liquidity), and the Exchange is not proposing to amend the current rates applied to LMMs during the Opening Cross. With the proposed changes, the last sentence of Options 7, Section 2(2) will now provide: “Lead Market Makers, BX Options Market Makers, Non-Customers, and Firms will be assessed the Fee to Remove Liquidity during the Exchange's Opening Cross.”

    Technical Changes

    The Exchange proposes a number of technical, non-substantive changes in Options 7. The Exchange first proposes to add “Section 1 General Provisions” at the beginning of the Pricing Schedule. The Exchange will also remove “Section 1” before the title “Collection of Exchange Fees and Other Claims-BX Options” and incorporate those provisions within the new Section 1, which will include other provisions such as the Pricing Schedule definitions. This change will assist Participants when citing to these defined terms, which currently has no section reference.

    The Exchange also proposes to update obsolete rule citations within proposed Section 1 to reflect the current rules.[14] The Exchange previously relocated the Rulebook and certain cross-cites were not updated.[15]

    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 Sections 6(b)(4) and 6(b)(5) of the Act,[17] in particular, in that it provides for the equitable allocation of reasonable dues, fees and other charges among members and issuers and other persons using any facility, and is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers.

    The Exchange's proposed changes to its schedule of credits are reasonable in several respects. As a threshold matter, the Exchange is subject to significant competitive forces in the market for options securities transaction services that constrain its pricing determinations in that market. The fact that this market is competitive has long been recognized by the courts. In NetCoalition v. Securities and Exchange Commission, the D.C. Circuit stated as follows: “[n]o one disputes that competition for order flow is `fierce.' . . . As the SEC explained, `[i]n the U.S. national market system, buyers and sellers of securities, and the broker-dealers that act as their order-routing agents, have a wide range of choices of where to route orders for execution'; [and] `no exchange can afford to take its market share percentages for granted' because `no exchange possesses a monopoly, regulatory or otherwise, in the execution of order flow from broker dealers'. . . .” [18]

    The Commission and the courts have repeatedly expressed their preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. In Regulation NMS, while adopting a series of steps to improve the current market model, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system “has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.” [19]

    Numerous indicia demonstrate the competitive nature of this market. For example, clear substitutes to the Exchange exist in the market for options security transaction services. The Exchange is only one of sixteen options exchanges to which market participants may direct their order flow. Competing options exchanges offer similar pricing structures to that of the Exchange, including schedules of rebates and fees that differentiate between LMMs and other market participants.[20]

    Within this environment, market participants can freely and often do shift their order flow among the Exchange and competing venues in response to changes in their respective pricing schedules. As such, the proposal represents a reasonable attempt by the Exchange to increase its liquidity and market share relative to its competitors.

    LMM Rebate To Add Liquidity

    The Exchange believes that the proposed LMM Rebate to Add Liquidity in Penny Symbols is reasonable, equitable, and not unfairly discriminatory. The proposal will offer a higher $0.11 per contract rebate to qualifying LMMs in their specifically allocated options classes along the same lines as the existing $0.10 per contract BX Options Market Maker Rebate to Add Liquidity in Penny Symbols (i.e., only if the order is contra to Non-Customers, Firms, BX Options Market Makers, or LMMs). The Exchange Start Printed Page 6704believes that the proposed rebate will incentivize LMMs to increase their liquidity provision on the Exchange, which will ultimately benefit all market participants through the quality of order interaction.

    The Exchange further believes that the proposed differentiation between LMMs and other market participants through the higher $0.11 per contract Rebate to Add Liquidity recognizes the differing contributions made to the liquidity and trading environment on the Exchange by LMMs through their quoting obligations and their commitment of capital, unlike other market participants. In addition, LMMs are subject to heightened quoting obligations compared to BX Options Market Makers.[21] Accordingly, the Exchange believes that offering a higher rebate to LMMs is equitable and not unfairly discriminatory.

    LMM Fee To Add Liquidity

    The Exchange believes that the proposed LMM Fee to Add Liquidity in Penny Symbols is reasonable, equitable and not unfairly discriminatory. The proposal will assess a lower $0.38 per contract fee to LMMs in their specifically allocated options classes along the same lines as the existing $0.39 per contract BX Options Market Maker Fee to Add Liquidity in Penny Symbols (i.e., only if the order is contra to Customers). The Exchange believes that the proposed fee remains competitive and will continue to attract order flow to BX to the benefit of all market participants. As described above, the proposed fee is lower than the current fee assessed to LMMs when trading against a Customer. The Exchange believes that the lower fee will incentivize LMMs to increase their liquidity provision on the Exchange, which will ultimately benefit all market participants through the quality of order interaction.

    The Exchange further believes that the proposed differentiation between LMMs and other market participants through the lower $0.38 per contract Fee to Add Liquidity recognizes the differing contributions made to the liquidity and trading environment on the Exchange by LMMs through their quoting obligations and their commitment of capital, unlike other market participants. In addition, LMMs are subject to heightened quoting obligations compared to BX Options Market Makers.[22] Accordingly, the Exchange believes that offering a lower fee to LMMs is equitable and not unfairly discriminatory.

    Separate LMM Pricing

    The Exchange believes that its proposal to restructure the pricing schedules in Options 7, Section 2 to add separate pricing for LMMs is reasonable, equitable, and not unfairly discriminatory. While the Exchange is proposing to add separate pricing for LMMs, LMMs will continue to be assessed the same BX Options Market Makers fees and rebates in their specifically allocated options classes under this proposal except with respect to the higher LMM Rebate to Add Liquidity in Penny Symbols and lower LMM Fee to Add Liquidity in Penny Symbols, as discussed above. The Exchange believes that separately providing for LMMs throughout the pricing schedules in Options 7, Section 2 will provide greater clarity and transparency as to what fees and rebates are assessed to this type of market participant.

    Opening Cross

    The Exchange believes that the proposed changes to the Opening Cross pricing provisions in Options 7, Section 2(2) is reasonable, equitable, and not unfairly discriminatory as it does not change the pricing currently assessed by the Exchange during the Opening Cross, but rather corrects an inadvertent omission by the 2012 Filing to include BX Options Market Makers within Options 7, Section 2(2). As discussed above, the Exchange intended to follow the Opening Cross pricing on NOM such that BX would similarly assess a Fee to Remove Liquidity on all market participants, other than a Customer, during the Opening Cross. The Exchange believes that the proposed correction to add BX Options Market Makers will help ensure that the Pricing Schedule more accurately represents the rates assessed currently during the Opening Cross and in the manner as originally intended by the 2012 Filing, thereby avoiding any potential confusion among market participants. The Exchange again notes that this proposed change is merely corrective in nature and does not change any rates that are currently applied during the Opening Cross.

    The proposed changes to add LMMs to the Opening Cross pricing provisions likewise do not change any rates that are currently applied to market participants during the Opening Cross. LMMs will continue to be assessed the same rates as BX Options Market Makers, including during the Opening Cross (i.e., the Fee to Remove Liquidity). Lastly, the proposed change to replace Professionals, Broker-Dealers, and Non-BX Options Market Makers with the term “Non-Customers,” which encompasses those market participant types, is non-substantive in nature. Accordingly, the Exchange believes that foregoing modifications are reasonable, equitable, and not unfairly discriminatory.

    Technical Changes

    The Exchange believes that the proposed technical changes described above are reasonable, equitable, and not unfairly discriminatory as they are all non-substantive changes intended to promote greater clarity and transparency to the Exchange's Pricing Schedule.

    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. In terms of intra-market competition, the proposed pricing changes are designed to attract additional order flow to the Exchange. The Exchange believes that the proposed higher LMM Rebate to Add Liquidity and lower LMM Fee to Add Liquidity will continue to incentivize LMMs to direct their order flow to the Exchange. Greater liquidity benefits all market participants on the Exchange by providing more trading opportunities and encourages LMMs to send orders to the Exchange, thereby contributing to robust levels of liquidity to the benefit of all market participants.

    In terms of inter-market competition, the Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues if they deem fee levels at a particular venue to be excessive, or rebate opportunities available at other venues to be more favorable. In such an environment, the Exchange must continually adjust its fees to remain competitive with other options exchanges. Because competitors are free to modify their own fees in response, and because market participants may readily adjust their order routing practices, the Exchange does not believe that its proposed fee change will impose any burden on intermarket competition. Furthermore, as noted above, competing options exchanges offer similar pricing structures to that of the Exchange, including schedules of rebates and fees that differentiate between LMMs and other market participants.[23]

    Start Printed Page 6705

    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

    The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.[24]

    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: (i) Necessary or appropriate in the public interest; (ii) for the protection of investors; or (iii) 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

    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-BX-2021-001. 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-BX-2021-001 and should be submitted on or before February 12, 2021.

    Start Signature

    For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.[25]

    J. Matthew DeLesDernier,

    Assistant Secretary.

    End Signature End Preamble

    Footnotes

    3.  The term “Lead Market Maker” or (“LMM”) applies to a registered BX Options Market Maker that is approved pursuant to Options 2, Section 3 to be the LMM in an options class (options classes).

    Back to Citation

    4.  The term “BX Options Market Maker” or (“M”) is a Participant that has registered as a Market Maker on BX Options pursuant to Options 2, Section 1, and must also remain in good standing pursuant to Options 2, Section 9. In order to receive Market Maker pricing in all securities, the Participant must be registered as a BX Options Market Maker in at least one security.

    Back to Citation

    5.  See Options 3, Section 8.

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    6.  A Non-Customer includes a Professional, Broker-Dealer and Non-BX Options Market Maker.

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    7.  The term “Firm” or (“F”) applies to any transaction that is identified by a Participant for clearing in the Firm range at OCC.

    Back to Citation

    8.  See Options 7, Section 2(1), note 2.

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    9.  The term “Customer” or (“C”) applies to any transaction that is identified by a Participant for clearing in the Customer range at The Options Clearing Corporation (“OCC”) which is not for the account of broker or dealer or for the account of a “Professional” (as that term is defined in Options 1, Section 1(a)(48)).

    Back to Citation

    10.  See Options 5, Section 4.

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    11.  See Options 3, Section 13.

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    12.  See Securities Exchange Act Release No. 67339 (July 3, 2012), 77 FR 40688 (July 10, 2012) (SR-BX-2012-043).

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    13.  See NOM Options 7, Section 2(2) (emphasis added).

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    14.  In particular, the Exchange will update obsolete cross-cites in the definitions of “Customer,” “BX Options Market Maker,” “Lead Market Maker,” “Professional,” and “Joint Back Office.” Similarly, the Exchange will also update the obsolete cross-cite in current Section 1 (Collection of Exchange Fees and Other Claims-BX Options).

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    15.  See Securities Exchange Act Release No. 84326 (October 1, 2018), 83 FR 50414 (October 5, 2018) (SR-BX-2018-046).

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    18.  NetCoalition v. SEC, 615 F.3d 525, 539 (DC Cir. 2010) (quoting Securities Exchange Act Release No. 59039 (December 2, 2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSEArca-2006-21)).

    Back to Citation

    19.  Securities Exchange Act Release No. 51808 (June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) (“Regulation NMS Adopting Release”).

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    20.  See, e.g., NYSE Arca Options Fees and Charges, Trade-Related Charges for Standard Options.

    Back to Citation

    21.  See Options 2, Section 4(j) (setting forth the 90% or higher quoting requirements for LMMs) and Section 5(d) (setting forth the 60% or higher quoting obligations for BX Options Market Makers).

    Back to Citation

    23.  See supra note 20.

    Back to Citation

    [FR Doc. 2021-01403 Filed 1-21-21; 8:45 am]

    BILLING CODE 8011-01-P

Document Information

Published:
01/22/2021
Department:
Securities and Exchange Commission
Entry Type:
Notice
Document Number:
2021-01403
Pages:
6700-6705 (6 pages)
Docket Numbers:
Release No. 34-90936, File No. SR-BX-2021-001
PDF File:
2021-01403.pdf