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Federal Register / Vol. 86, No. 151 / Tuesday, August 10, 2021 / Notices A. Self-Regulatory Organizations Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose
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Background The Exchange plans to transition its options trading platform to its Pillar technology platform. The Exchanges and its national securities exchange affiliates 4 together with the Exchange, the NYSE Exchanges cash equity markets are currently operating on Pillar. For this transition, the Exchange proposes to use the same Pillar technology already in operation for its cash equity market. In doing so, the Exchange will be able to offer not only common specifications for connecting to both of its cash equity and equity options markets, but also common trading functions. The Exchange plans to roll out the new technology platform over a period of time based on a range of symbols, anticipated for the fourth quarter of 2021.
In this regard, the Exchange recently filed a proposal to add new rules to reflect how options, particularly singleleg options, would trade on the Exchange once Pillar is implemented.5
The current proposal sets forth how Electronic Complex Orders 6 would trade on the Exchange once Pillar is implemented. As noted in the SingleLeg Pillar Filing, as the Exchange transitions to Pillar, certain rules would continue to be applicable to symbols trading on the current trading platform, but would not be applicable to symbols that have transitioned to trading on Pillar.7 Consistent with the Single-Leg Pillar Filing, proposed Rule 6.91PO
would have the same number as the current Electronic Complex Order Trading rule, but with the modifier P
appended to the rule number. Current Rule 6.91O, governing Electronic 4 The Exchanges national securities exchange affiliates are the New York Stock Exchange LLC
NYSE, NYSE American LLC NYSE
American, NYSE National, Inc. NYSE
National, and NYSE Chicago, Inc. NYSE
Chicago.
5 See Securities Exchange Act Release No. 92304
June 30, 2021, 86 FR 36440 July 9, 2021 SR
NYSEArca2021047 Single-Leg Pillar Filing.
6 The term Electronic Complex Order is currently defined in the preamble to Rule 6.91O
to mean any Complex Order, as defined in Rule 6.62Oe or any Stock/Option Order or Stock/
Complex Order as defined in Rule 6.62Oh that is entered into the NYSE Arca System the System.
7 See Single-Leg Pillar Filing providing that, once a symbol is trading on the Pillar trading platform, a rule with the same number as a rule with a P modifier would no longer be operative for that symbol and the Exchange would announce by Trader Update when symbols are trading on the Pillar trading platform.

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Complex Order Trading, would remain unchanged and continue to apply to any trading in symbols on the current system. Proposed Rule 6.91PO would govern Electronic Complex Orders for trading in options symbols migrated to the Pillar platform.
Similar to the Single-Leg Pillar Filing, proposed Rule 6.91PO would 1 use Pillar terminology that is based on Exchange Rule 7E Pillar terminology governing cash equity trading; and 2
introduce new functionality for Electronic Complex Order trading.
Finally, as discussed in the Single-Leg Pillar Filing, the Exchange will announce by Trader Update when symbols are trading on the Pillar trading platform. The Exchange intends to transition Electronic Complex Order trading on Pillar at the same time that single-leg trading is transitioned to Pillar.
Proposed Rule 6.91PO: Electronic Complex Order Trading Current Rule 6.91O Electronic Complex Order Trading specifies how the Exchange processes Electronic Complex Orders submitted to the Exchange. The Exchange proposes new Rule 6.91PO to establish how such orders would be processed after the transition to Pillar. To promote clarity and transparency, the Exchange proposes to add a preamble to current Rule 6.91O specifying that it would not be applicable to trading on Pillar.
As discussed in greater detail below, the Exchange is not proposing fundamentally different functionality regarding how Electronic Complex Orders would trade on Pillar than is currently available on the Exchange.
However, with Pillar, the Exchange would introduce certain new or updated functionality available for options trading on the Pillar platform and use Pillar terminology.
Definitions. Proposed Rule 6.91POa would set forth the definitions applicable to trading on Pillar under the new rule.
Proposed Rule 6.91POa1 would define the term Electronic Complex Order or ECO to mean a Complex Order as defined in proposed Rule 6.62POf or a Stock/Option Order or Stock/Complex Order as defined in proposed Rule 6.62POh6A, B, respectively, that would be submitted electronically to the Exchange.8 This proposed definition is based on the 8 The proposed definitions of Complex Order, Stock/Option Order and Stock/Complex Order under Pillar are set forth in proposed Rules 6.62P
Of, h6A, and h6B, as described in the Single-Leg Pillar Filing, and are substantially identical to the current definitions.

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preamble to Rule 6.91O without any substantive differences, except that reference to the NYSE Arca System would be replaced with the term Exchange and cross-references have been updated to reflect rules proposed in the Single-Leg Pillar Filing.
Proposed Rule 6.91POa2 would define the term ECO Order Instruction to mean a request to cancel, cancel and replace, or modify an ECO.
As described further below, this concept relates to order processing when a series opens or reopens for trading and is based on the term order instruction as used in Rule 7.35Eg and proposed to be used in Rules 6.64POe and f, which similarly would define an order instruction for options as a request to cancel, cancel and replace, or modify an order or quote.9
Proposed Rule 6.91POa3 would define the term leg or leg market to mean each of the component option series that comprise an ECO. This definition is consistent with the concept of leg markets as used in current Rule 6.91Oa, which defines legs as individual orders and quotes in the Consolidated Book. The Exchange believes the proposed definition would add clarity regarding how the terms leg and leg market would be used in connection with ECO trading on Pillar.
Proposed Rule 6.91POa4 would define the term Complex NBBO to mean the derived national best bid and derived national best offer for a complex strategy calculated using the NBB and NBO for each component leg of a complex strategy. This definition is based on current Rule 6.1AOa2b, without any substantive differences.
Proposed Rule 6.91POa5 would define the term Complex strategy to mean a particular combination of leg components and their ratios to one another. The proposed definition would further provide that new complex strategies can be created when the Exchange receives either a request to create a new complex strategy or an ECO with a new complex strategy. This proposed definition is new and is consistent with how this concept is defined on other options exchanges and would promote clarity and transparency.10
9 See Single-Leg Pillar Filing describing proposed opening Auction Process rule per Rule 6.64PO.
10 See, e.g., Cboe Exchange Inc. Cboe Rule 5.33a defining complex strategy as a particular combination of components and their ratios to one another and further providing that new complex strategies can be created as the result of the receipt of a complex instrument
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