Statement Summary
The Cboe Exchange, Inc. has proposed a rule change to clarify the timing requirements for fee submissions with applications for Trading Permit Holders (TPHs) and when such applications will be automatically withdrawn. Previously, fees had to be submitted along with the application, which often assumed payment by check. The amendment allows applicants to submit fees within a reasonable time frame after their application submission, which may include alternative payment methods like wire transfers.
Additionally, the rule change stipulates that the six-month period for processing applications will start upon the application submission, regardless of when fees are paid. This change, intended to align with current practices, seeks to enhance clarity for applicants and will uniformly apply to all prospective TPHs, thus not imposing undue competitive burdens.
Original Statement
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-103105; File No. SR-CBOE-2025-037]
Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Amend its Rules to Clarify the Timing Requirements of when Fees must be Submitted with an Application and when the Application will be Deemed to be Automatically Withdrawn
May 22, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), and Rule 19b-4 thereunder, notice is hereby given that on May 14, 2025, Cboe Exchange, Inc. (the “Exchange” or “Cboe Options”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. The Exchange filed the proposal as a “non-controversial” proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act and Rule 19b-4(f)(6) thereunder. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons.
Self-Regulatory Organization’s Statement
The Exchange proposes to amend its rules to clarify the timing requirements of when fees must be submitted with an application and when the application will be deemed to be automatically withdrawn. The text of the proposed rule change is provided in Exhibit 5.
Purpose and Statutory Basis
The Exchange proposes amendments to Rule 3.10, to update when fees for an application for prospective Trading Permit Holders (TPHs) are due and when an application for a TPH should be considered automatically withdrawn. The Exchange’s current Rule 3.10(b) requires that application fees are filed within the application and by doing so, assumes that application fees are submitted via a check. The Exchange proposes to update this Rule to allow for payment to be submitted within a reasonable time of submitting the application – this allows for applicants to have flexibility and timing to ensure another method of payment (e.g., a wire) gets to the Exchange in a timely manner.
The Exchange proposes to have the timing be in the Exchange’s discretion to prevent a hard stop in the processing of an application in the event there is a delay in payment. The Exchange typically requires payment within 30 days of receipt of an application but would still request that it has the flexibility to extend this when needed as to not prevent additional work by requiring an applicant to resubmit its application if it pays on day 31.
The Exchange’s current Rule 3.10(i) requires that if the application process is not completed within 6 months of the submission of the application and the appropriate fees, that the application shall be deemed to be automatically withdrawn. The Exchange proposes to modify this Rule to clearly set the 6-month timer to begin at the time of the application submission by removing the requirement that the fee has also been remitted.
Comments and Feedback
The Exchange neither solicited nor received comments on the proposed rule change. 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 electronic means or paper, and all submissions should refer to File Number SR-CBOE-2025-037.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Sherry R. Haywood,
Assistant Secretary.
