60 Day Notice

3235-0733.pdf

Rule of Practice 194

60 Day Notice

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Federal Register / Vol. 87, No. 134 / Thursday, July 14, 2022 / Notices
D. Consistency With Rule 17Ad–
22(e)(21) Under the Act
Rule 17Ad–22(e)(21)(iv) under the Act
requires that each covered clearing
agency establish, implement, maintain
and enforce written policies and
procedures reasonably designed to have
the covered clearing agency’s
management regularly review the
efficiency and effectiveness of its use of
technology and communication
procedures.35
As mentioned above, FICC maintains
multiple network and communication
methods to interact with its members,
including certain outdated
communication technologies necessary
to support members that continue to use
such older technologies. FICC believes
that continuing to use such outdated
technologies could render
communications between FICC and
some of its members vulnerable to cyber
risks. Additionally, members’ use of
outdated technology delays FICC’s
implementation of its own internal
system upgrades, which by doing so,
risks losing connectivity between FICC
and a number of its members. Finally,
FICC states that it currently expends
unnecessary resources to maintain
outdated communications channels. In
other words, FICC has subjected its
network communication methods to
review for efficiency and effectiveness.
As a result, to enhance the efficiency
and effectiveness of its technology and
communication procedures, FICC
proposes to require its members to
upgrade and maintain network
technology, communication technology,
and protocol standards, in accordance
with applicable technology standards
that FICC would identify and publish
via Important Notice on its website.
Because the Proposed Rule Change is an
outgrowth of FICC’s review of the
efficiency and effectiveness of its
technology and communication
procedures, the Commission finds the
Proposed Rule Change is consistent
with the requirements of Rule 17Ad–
22(e)(21)(iv) under the Act.36

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IV. Conclusion
On the basis of the foregoing, the
Commission finds that the Proposed
Rule Change is consistent with the
requirements of the Act and in
particular with the requirements of
Section 17A of the Act 37 and the rules
and regulations promulgated
thereunder.
35 17

CFR 240.17Ad–22(e)(21)(iv).

36 Id.
37 15

U.S.C. 78q–1.

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It is therefore ordered, pursuant to
Section 19(b)(2) of the Act 38 that
Proposed Rule Change SR–FICC–2022–
003, be, and hereby is, approved.39
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.40
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022–15004 Filed 7–13–22; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–780, OMB Control No.
3235–0733]

Proposed Collection; Comment
Request; Extension: Rule 194
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
(‘‘Commission’’) is soliciting comments
on the existing collection of information
provided for in Commission Rule of
Practice 194, (17 CFR 240.194), under
the Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.). The Commission
plans to submit this existing collection
of information to the Office of
Management and Budget (‘‘OMB’’) for
extension and approval.
Rule of Practice 194 provides a
process for security-based swap dealers
and major security-based swap
participants (collectively, ‘‘SBS Entity’’)
to make an application to the
Commission for an order permitting an
associated person who is subject to a
statutory disqualification to effect or be
involved in effecting security-based
swaps on behalf of the SBS Entity. Rule
of Practice 194 specifies the process for
obtaining relief from the statutory
prohibition in Exchange Act Section
15F(b)(6), including by setting forth the
required showing, the form of
application and the items to be
addressed with respect to associated
persons that are natural persons. An
SBS Entity is not required to file an
application under Rule of Practice 194
with respect to certain associated
persons that are subject to a statutory
U.S.C. 78s(b)(2).
approving the Proposed Rule Change, the
Commission considered the proposals’ impact on
efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
40 17 CFR 200.30–3(a)(12).

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39 In

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disqualification, as provided for in
paragraph (h) of Rule of Practice 194. To
meet those requirements, however, the
SBS Entity is required to file a notice
with the Commission.
It is estimated that approximately 50
entities may fit within the definition of
security-based swap dealer and up to
five entities may fit within the
definition of major security-based swap
participant—55 SBS Entities in total.
The Commission anticipates that, on an
average annual basis, only a small
fraction of the natural persons at an SBS
Entity would be subject to a statutory
disqualification. Accordingly, based on
available data, the Commission
estimates that, on an average annual
basis, the Commission would receive up
to five applications in accordance with
Rule of Practice 194 with respect to
associated persons that are natural
persons, and five notices pursuant to
proposed Rule of Practice 194(h) with
respect to associated persons that are
natural persons. The Commission
estimates that the average time
necessary for an SBS Entity to research
the questions, and complete and file an
application under Rule of Practice 194
with respect to associated persons that
are natural persons is approximately 30
hours, for a total of approximately 150
burden hours per year for all SBS
Entities. The Commission estimates that
approximately five SBS Entities will
provide notices pursuant to Rule of
Practice 194(h) for one natural person
each on an average annual basis taking
approximately 6 hours per notice, for a
total of approximately 30 burden hours
per year for all SBS Entities providing
the notices for an estimated five natural
persons. As such, the combined
estimated annual hour burden for all
SBS Entities to complete applications
and notices pursuant to Rule of Practice
194 is approximately 180 hours per year
(150 + 30).
Written comments are invited on: (a)
whether the proposed collection of
information is necessary for the proper
performance of the functions of the
Commission, including whether the
information shall have practical utility;
(b) the accuracy of the Commission’s
estimates of the burden of the proposed
collection of information; (c) ways to
enhance the quality, utility, and clarity
of the information collected; and (d)
ways to minimize the burden of the
collection of information on
respondents, including through the use
of automated collection techniques or
other forms of information technology.
Consideration will be given to
comments and suggestions submitted by
September 12, 2022.

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Federal Register / Vol. 87, No. 134 / Thursday, July 14, 2022 / Notices

An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
under the PRA unless it displays a
currently valid OMB control number.
Please direct your written comments
to: David Bottom, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o John
Pezzullo, 100 F Street NE, Washington,
DC 20549, or send an email to: PRA_
[email protected].
Dated: July 8, 2022.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022–14995 Filed 7–13–22; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–95225; File No. SR–CBOE–
2022–034]

Self-Regulatory Organizations; Cboe
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Update Its Fees
Schedule in Connection With the
Exchange’s Plans To List and Trade
FLexible EXchange Index Options With
an Index Multiplier of One
July 8, 2022.

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 June 30,
2022, Cboe Exchange, Inc. (the
‘‘Exchange’’ or ‘‘Cboe Options’’) filed
with the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the Exchange.
The Commission is publishing this
notice to solicit comments on the
proposed rule change from interested
persons.

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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Cboe Exchange, Inc. (the ‘‘Exchange’’
or ‘‘Cboe Options’’) proposes to update
its Fees Schedule in connection with
the Exchange’s plans to list and trade
FLexible EXchange (‘‘FLEX’’) index
options with an index multiplier of one
(‘‘FLEX Micro Options’’). The text of the
proposed rule change is provided in
Exhibit 5.
The text of the proposed rule change
is also available on the Exchange’s
website (http://www.cboe.com/
1 15
2 17

U.S.C. 78s(b)(1).
CFR 240.19b–4.

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AboutCBOE/
CBOELegalRegulatoryHome.aspx), at
the Exchange’s Office of the Secretary,
and at the Commission’s Public
Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend its
Fees Schedule in connection with its
plans to list and trade FLEX Micro
Options.3
By way of background, the Exchange
has adopted rules to accommodate the
listing and trading of certain FLexible
EXchange (‘‘FLEX’’) index options with
an index multiplier of one (‘‘FLEX
Micro Options’’) rather than the
conventional 100. FLEX Micro Options
will be available on the following
indices effective June 27, 2022: S&P 500,
Russell 2000 (RUT), Dow Jones
Industrial Average (DJX), MSCI
Emerging Markets (MXEF), and MSCI
EAF (MXEA). The Exchange believes
FLEX Micro Options will expand
investors’ choices and flexibility by
listing and trading FLEX options on
larger-valued broad-based indexes,
which provide investors with the ability
to gain exposure to the market, with a
notional value of 1/100th of the value of
currently available FLEX Index Options.
The Exchange believes the additional
granularity provided by FLEX Micro
Options with respect to the prices at
which investors may execute and
exercise index options on the Exchange
will appeal to institutional investors by
providing them with an additional
exchange-traded tool to manage the
positions and associated risk in their
3 The Exchange initially filed the proposed fee
changes on June 27, 2022 (SR–CBOE–2022–031).
On June 28, 2022, the Exchange withdrew that
filing and submitted SR–CBOE–2022–033. On June
30, 2022 the Exchange withdrew that filing and
submitting this filing.

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portfolios more precisely based on
notional value, which currently may
equal a fraction of a standard contract.
The Exchange now proposes to amend
its Fees Schedule to accommodate the
planned listing and trading of FLEX
Micro options.
Standard Transaction Rates
First, the Exchange proposes to adopt
certain standard transaction fees in
connection with FLEX Micro Options.
Specifically, the proposed rule change
adopts certain fees for FLEX Micro
Options in the ‘‘Rate Table for All
Products Excluding Underlying Symbol
A’’.4 The Exchange notes that the
proposed standard transaction fees in
connection with FLEX Micros Options
are lower-priced than standard FLEX
options on the corresponding indices
given their multiplier of one (as
compared to 100 for standard FLEX
options). Indeed, the proposed
transaction fees are generally near, or
approximately, 1/100th of the fees
currently assessed for the corresponding
standard FLEX options (inclusive of the
Execution Surcharge, License
Surcharges and FLEX Surcharges, as
applicable). The proposed fees are as
follows:
RUT FLEX Micro Options
• Adopts fee code GA, appended to
all (i) Customer (capacity ‘‘C’’), (ii)
Market-Maker (capacity ‘‘M’’), and (iii)
Clearing Trading Permit Holders
(‘‘TPHs’’) (capacity ‘‘F’’) and NonClearing TPH Affiliates (capacity
‘‘L’’)(collectively, ‘‘Firms’’) orders in
RUT FLEX Micro Options and assesses
a fee of $0.009 per contract.
• Adopts fee code GB, appended to
all Broker-Dealers (capacity ‘‘B’’), Joint
Back-Offices (capacity ‘‘J’’), NonTrading Permit Holder Market-Makers
(capacity ‘‘N’’), and Professionals
(capacity ‘‘U’’) (collectively, ‘‘NonCustomers’’) manual and AIM (Agency/
Primary and Contra) orders in RUT
FLEX Micro Options and assesses a fee
of $0.009 per contract.; and
• Adopts fee code GC, which is
appended to all Non-Customer
electronic orders in RUT FLEX Micro
Options and assesses a fee of $0.012 per
contract.
SPX FLEX Micro Options
• Adopts fee code GE, appended to
all (i) Customer and (ii) Firm orders in
SPX FLEX Micro Options and assesses
a fee of $0.008 per contract;
4 Underlying Symbol List A currently includes
OEX, XEO, RUT, RLG, RLV, RUI, UKXM, SPX
(includes SPXW), SPESG and VIX. See Cboe
Options Fees Schedule, Footnote 34.

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