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Federal Register / Vol. 86, No. 168 / Thursday, September 2, 2021 / Notices and the public interest by ensuring that BSTX Participants have appropriate supervisory controls in place to carry out their business activities in compliance with applicable regulatory requirements. For example, proposed Rule 21000 Written Procedures would require BSTX Participants to enforce written procedures which enable them to supervise the activities of their associated persons and proposed Rule 21010 Responsibility of BSTX
Participants would require a BSTX
Participant to designate a person in each office to carry out written supervisory procedures. Requiring appropriate supervision of a BSTX Participants business activities and associated persons would promote compliance with the federal securities laws and other applicable regulatory requirements in furtherance of the protection of investors and the public interest.136 In addition, each of the rules in the proposed Rule 21000 Series Supervision is substantially similar to supervisory rules of other exchanges.137
Miscellaneous Provisions Rule 22000
Series The Exchange proposes to adopt as its Rule 22000 Series Miscellaneous Provisions, six rules relating to a variety of miscellaneous requirements applicable to BSTX Participants that are substantially similar to rules of other exchanges.138 These miscellaneous provisions relate to: i Comparison and settlement requirements; 139 ii failures to deliver and failures to receive; 140 iii forwarding of proxy and other issuerrelated materials; 141 iv 136 Id.
137 See
supra note 128.
Cboe BZX Chapter 13 rules. See also IEX
Rule 6.180 with respect to proposed Rule 22050
Transactions Involving BOX Employees.
139 Proposed Rule 22000 Comparison and Settlement Requirements provides that a BSTX
Participant that is a member of a registered clearing agency shall implement comparison and settlement procedures as may be required under the rules of such entity. The proposed rule would further provide that, notwithstanding this general provision, the Board may extend or postpone the time of delivery of a BSTX transaction whenever the Board determines that it is called for by the public interest, just and equitable principles of trade or to address unusual conditions. In such a case, delivery will occur as directed by the Board.
140 Proposed Rule 22010 Failure to Deliver and Failure to Receive provides that borrowing and deliveries must be effected in accordance with Rule 203 of Regulation SHO 17 CFR 242.203 and incorporates Rules 200203 of Regulation SHO by reference into the rule 17 CFR 242.200203.
141 Proposed Rule 22020 Forwarding of Proxy and Other Information; Proxy Voting generally provides that BSTX Participants shall forward proxy materials when requested by an issuer and sets forth certain conditions and limitations for BSTX Participants to give a proxy to vote stock that is registered in its name.

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commissions; 142 v regulatory services agreements; 143 and vi transactions involving Exchange employees.144
These rules are designed to capture additional regulatory requirements applicable to BSTX Participants, such as setting forth their obligation to deliver proxy materials at the request of an issuer and to incorporate by reference Rule 200203 of Regulation SHO.145
The Exchange believes that the proposed Rule 22000 Miscellaneous Provisions Series is consistent with Section 6b5 of the Exchange Act 146
because these proposed rules are designed to prevent fraudulent and manipulative acts and practices, promote just and equitable principles of trade, and protect investors and the public interest by ensuring that BSTX
Participants comply with additional regulatory requirements, such as Rule 203 of Regulation SHO 147 as provided in proposed Rule 22010 Failure to Deliver and Failure to Receive, in connection with their participation on BSTX. For example, proposed Rule 22030 Commissions prohibits BSTX
Participants from charging fixed rates of commissions for transactions on the Exchange consistent with Section 6e1
of the Exchange Act.148 Similarly, proposed Rule 22050 Transactions involving Exchange Employees sets forth certain requirements and prohibitions relating to a BSTX
Participant providing certain financial services to an Exchange employee, which the Exchange believes helps prevent potentially fraudulent and manipulative acts and practices and furthers the protection of investors and the public interest.
In addition, the Exchange proposes to adopt Rule 22060 to provide a highlevel description of the market data 142 Proposed Rule 22030 Commissions provides that the Exchange Rules or practices shall not be construed to allow a BSTX Participant or its associated persons to agree or arrange for the charging of fixed rates commissions for transactions on the Exchange.
143 Proposed Rule 22040 Regulatory Service Agreement provides that the Exchange may enter into regulatory services agreements with other SROs to assist in carrying out regulatory functions, but the Exchange shall retain ultimate legal responsibility for, and control of, its SRO
responsibilities.
144 Proposed Rule 22040 Transactions Involving Exchange Employees sets forth conditions and limitations on a BSTX Participant providing loans or supporting the account of an Exchange employee e.g., promptly obtaining and implementing an instruction from the employee to provide duplicate account statement to the Exchange in order to mitigate any potential conflicts of interest that might arise from such a relationship.
145 17 CFR 242.200203.
146 15 U.S.C. 78fb5.
147 17 CFR 242.203.
148 15 U.S.C. 78fe1.

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products that the Exchange will offer.
Specifically, proposed Rule 22060 sets forth a brief description of: i BSTX
Depth-of Book data,149 ii BSTX Top-ofBook,150 iii BSTX Last Sale,151 and iv the BSTX Market Data Blockchain.152
The Exchange believes that providing a brief description of the market data product offerings by the Exchange in the rulebook promotes clarity to market participants with respect to the Exchanges different market data product offerings, which the Exchange believes helps may serve to remove impediments to and perfect the mechanism of a free and open market and a national market system, consistent with Section 6b5 of the Exchange Act,153 by ensuring market participants are adequately informed of the Exchanges offerings. The Exchange notes that proposed Rule 22060 is substantially similar to a rule of another national securities exchange.154
Trading Practice Rules Rule 23000
Series The Exchange proposes to adopt as its Rule 23000 Series Trading Practice Rules, 14 rules relating to trading practice requirements for BSTX
Participants that are substantially similar to trading practice rules of other exchanges.155 The proposed Rule 23000
Series would specify trading practice requirements related to: i Market manipulation; ii fictitious transactions;
iii excessive sales by a BSTX
Participant; iv manipulative transactions; v dissemination of false information; vi prohibition against trading ahead of customer orders; vii joint activity; viii influencing data feeds; ix trade shredding; x best execution; xi publication of transactions and changes; xii trading ahead of research reports; xiii front running of block transactions; and xiv a prohibition against disruptive quoting and trading activity. The purpose of the trading practice rules is to set forth standards and rules relating to the 149 BSTX Depth-of-Book would be a data feed that contains all displayed orders for Securities trading on the Exchange, order executions, order cancellations, order modifications, and administrative messages.
150 BSTX Top-of-Book would be an uncompressed data feed that offers top of book quotations and execution information based on orders entered into the BSTX System.
151 BSTX Last Sale would be an uncompressed data feed that offers only execution information based on orders entered into the BSTX System.
152 The BSTX Market Data Blockchain is described in proposed Rule 22060d as historical market data with respect to trading on the BSTX
System, as set forth in Rule 17020.
153 15 U.S.C. 78fb5.
154 See MEMX LLC Rule 13.8.
155 See Cboe BZX Chapter 12 rules.

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