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Federal Register / Vol. 86, No. 38 / Monday, March 1, 2021 / Notices Commission an application for an exemption under Section 36a1 of the Securities Exchange Act of 1934 Act or Exchange Act 1 from the rule filing requirements of Section 19b of the Exchange Act 2 with respect to certain rules of the Financial Industry Regulatory Authority, Inc. FINRA
and Miami International Securities Exchange, LLC MIAX, an affiliate of MIAX PEARL, that the Exchange seeks to incorporate by reference.3 Section 36
of the Exchange Act authorizes the Commission to conditionally or unconditionally exempt any person, security, or transaction, or any class thereof, from any provision of the Exchange Act or rule thereunder, if necessary or appropriate in the public interest and consistent with the protection of investors.
On August 14, 2020, the Commission approved the Exchanges proposal to adopt rules to govern the trading of cash equities and establish an equities trading facility of the Exchange.4 Among other things, these MIAX PEARL
Equities Rules include conduct and operational rules applicable to a new category of Exchange member participation, referred to as Equity Members.
MIAX PEARL has requested, pursuant to Rule 012 under the Exchange Act,5
that the Commission grant the Exchange an exemption from the rule filing requirements of Section 19b of the Act for changes to those MIAX PEARL
Equities Rules that are effected solely by virtue of a change to a cross-referenced FINRA or MIAX rule.6 Specifically, the Exchange requests that it be permitted to incorporate by reference changes made to each FINRA or MIAX rule or series of rules as the case may be that is cross-referenced in the following MIAX PEARL Equities Rules, without 1 15

U.S.C. 78mma1.
U.S.C. 78sb.
3 See Letter from Christopher Solgan, VP, Senior Counsel, MIAX PEARL, to Vanessa Countryman, Secretary, Commission, dated January 15, 2021
Exemptive Request. The Exchange submitted the Exemptive Request in connection with its proposal to adopt rules to govern the trading of equity securities on the Exchange referred to herein as MIAX PEARL Equities Rules. See Securities Exchange Act Release Nos. 88132 February 6, 2020, 85 FR 8053 February, 12, 2020 Notice of Filing of a Proposed Rule Change To Adopt Rules Governing the Trading of Equity Securities; and 88859 May 12, 2020, 85 FR 29759 May 18, 2020
Notice of Filing of Amendment No. 1 and Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change, as Modified by Amendment No. 1, To Establish Rules Governing the Trading of Equity Securities.
4 See Securities Exchange Act Release No. 83289
August 14, 2020, 85 FR 51510 August 20, 2020
SRPEARL202003.
5 17 CFR 240.012.
6 See Exemptive Request, supra note 3, at 2.
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the need for the Exchange to file separately the same proposed rule changes pursuant to Section 19b of the Act: 7
Rule 2101 Violations Prohibited cross-references MIAX Rule 300
Adherence to Law, Rule 2104 Communications with the Public cross-references FINRA Rule 2210 Communications with the Public except for paragraph c of FINRA Rule 2210, Rule 2105 Know Your Customer cross-references FINRA Rule 2090
Know Your Customer, Rule 2107 Suitability crossreferences FINRA Rule 2111
Suitability, Rule 2119 Telemarketing crossreferences MIAX Rule 1325
Telemarketing, Rule 2200 General Requirements cross-references FINRA Rule 4511
General Requirements, Rule 2201 Customer Account Information cross-references FINRA
Rule 4512 Customer Account Information, Rule 2203 Record of Written Complaints cross-references FINRA
Rule 4513 Records of Written Customer Complaints, Rule 2204 Disclosure of Financial Condition cross-references MIAX Rule 1313 Statement of Financial Condition to Customers, Rule 2302 Annual Certification of Compliance and Supervisory Processes cross-references FINRA Rule 3130
Annual Certification of Compliance and Supervisory Processes, Rule 2303 Prevention of the Misuse of Material, Non-Public Information cross-references MIAX Rule 303
Prevention of the Misuse of Material Non-Public Information, Rule 2304 Anti-Money Laundering Compliance Program cross-references MIAX Rule 315 Anti-Money Laundering Compliance Program, Rule 2305 Transactions for or by Associated Persons cross-references FINRA Rule 3210 Accounts at Other Broker-Dealers and Financial Institutions, Rule 2712 Trading Ahead of Research Reports cross-references MIAX Rule 320 Trading Ahead of Research Reports, Rule 2714 Front Running of Block Transactions cross-references FINRA
Rule 5270 Front Running of Block Transactions, and Rule 2715 Disruptive Quoting and Trading Activity Prohibited crossreferences MIAX Rule 322 Disruptive Quoting and Trading Activity Prohibited.
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The Exchange states that the direct incorporations by reference of FINRA
and MIAX rules, which are regulatory in nature,8 are intended to be a comprehensive integration of the relevant FINRA and MIAX rules into the MIAX PEARL Equities Rules.9 As the Exchange notes, the MIAX PEARL Rules currently incorporate by reference Chapters III and XIII of the MIAX Rules, and the Exchange has previously received an exemption from the rule filing requirements of Section 19b with respect to these rules.10 Equity Members are a subset of MIAX PEARL
Members,11 and MIAX PEARL Members are currently subject to the MIAX Rules that are already incorporated by reference.12 According to the Exchange, the recently approved MIAX PEARL
Equities Rules cross-reference to these MIAX Rules for completeness and to remove doubt as to whether an Equity Member would be subject to these crossreferenced MIAX Rules.13
The Exchange represents that, as a condition to the requested exemption from Section 19b of the Act, the Exchange will provide written notice to its members whenever FINRA or MIAX
proposes a change to a cross-referenced rule.14 Such notice will alert Exchange members to the proposed rule change and give them an opportunity to comment on the proposal.15 The Exchange further represents that it similarly will inform members in 8 See id. at 4. The Exchange represents that the FINRA and MIAX rules proposed to be incorporated by reference are not trading rules. In addition, the Exchange notes that several other self-regulatory organizations SROs incorporate by reference certain regulatory rules of another SRO and have received from the Commission similar exemptions from Section 19b of the Exchange Act. See id. at 4 n.7.
9 See id. at 4.
10 See id. at 3; Securities Exchange Act Release No. 79543 December 13, 2016, 81 FR 92901
December 20, 2016 File No. 10227 In the Matter of the Application of MIAX PEARL, LLC for Registration as a National Securities Exchange;
Findings, Opinion, and Order of the Commission granting the application of MIAX PEARL for registration as a national securities exchange, and conditionally exempting MIAX PEARL from the rule filing requirements of Section 19b of the Act with respect to the MIAX, Chicago Board Options Exchange, Incorporated CBOE, New York Stock Exchange LLC, and FINRA rules that MIAX PEARL
proposed to incorporate by reference, including MIAX Rules Chapters III and XIII.
11 See MIAX PEARL Rule 2000.
12 See MIAX PEARL Rules Chapters III and XIII.
13 See Exemptive Request, supra note 3, at 4.
14 The Exchange represents that it will provide such notice on its website in the same section it uses to post its own proposed rule change filings pursuant to Rule 19b4l within the same time period required by such Rule. The MIAX PEARL
website will also include a link to the FINRA or MIAX website where the proposed rule change filings are located. See id.
15 See id. at 4 n.8.

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