Self-Regulatory Organizations; Miami International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Exchange Rule 515A, MIAX Price Improvement Mechanism and PRIME Solicitation Mechanism

[Federal Register Volume 91, Number 105 (Tuesday, June 2, 2026)]

[Notices]

[Pages 33011-33014]

From the Federal Register Online via the Government Publishing Office [ www.gpo.gov ]

[FR Doc No: 2026-10952]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-105570; File No. SR-MIAX-2026-21]

Self-Regulatory Organizations; Miami International Securities

Exchange, LLC; Notice of Filing and Immediate Effectiveness of a

Proposed Rule Change To Amend Exchange Rule 515A, MIAX Price

Improvement Mechanism and PRIME Solicitation Mechanism

May 28, 2026.

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 May 15, 2026, Miami International Securities Exchange, LLC

(``MIAX'' or ``Exchange'') 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 Commission is publishing this notice to solicit comments

on the proposed rule change from interested persons.

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\1\ 15 U.S.C. 78s(b)(1).

\2\ 17 CFR 240.19b-4.

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I. Self-Regulatory Organization's Statement of the Terms of Substance

of the Proposed Rule Change

The Exchange proposes to amend Exchange Rule 515A, MIAX Price

Improvement Mechanism (``PRIME'') and PRIME Solicitation Mechanism, to

permit orders for the accounts of Market Makers assigned in the

applicable options class, to be solicited as a contra party to the

Agency Order submitted for execution in a PRIME or cPRIME Auction.

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

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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 Policy .04 of Exchange Rule 515A,

MIAX Price Improvement Mechanism (``PRIME'') and PRIME Solicitation

Mechanism, (``Solicitation Auction'') \3\ to permit orders for the

accounts of Market Makers \4\ assigned in the applicable options class,

to be solicited as a contra party to the Agency Order \5\ submitted for

execution in a PRIME or cPRIME Auction.\6\

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\3\ See Exchange Rule 515A(b).

\4\ The term ``Market Makers'' refers to ``Lead Market Makers,''

``Primary Lead Market Makers,'' and ``Registered Market Makers''

collectively. See Exchange Rule 100.

\5\ PRIME is a process by which a Member may electronically

submit for execution (``Auction'') an order it represents as agent

(``Agency Order'') against principal interest, and/or an Agency

Order against solicited interest. See Exchange Rule 515A(a). The

term ``Member'' means an individual or organization approved to

exercise the trading rights associated with a Trading Permit.

Members are deemed ``members'' under the Exchange Act. See Exchange

Rule 100.

\6\ ``cPRIME'' is the process by which a Member may

electronically submit a ``cPRIME Order'' (as defined in Rule

518(b)(7)) it represents as agent (a ``cPRIME Agency Order'')

against principal or solicited interest for execution (a ``cPRIME

Auction''). See Exchange Rule 515A.12(a).

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PRIME is a process by which a Member \7\ may electronically submit

for execution (``Auction'') an order it represents as agent (``Agency

Order'') against principal interest, and/or an Agency Order against

solicited interest.\8\ A Member (the ``Initiating Member'') may

initiate an Auction provided all of the following are met: (i) the

Agency Order is in a class designated as eligible for PRIME as

determined by the Exchange and within the designated Auction order

eligibility size parameters as such size parameters are determined by

the Exchange; (ii) the Initiating Member must stop the entire Agency

Order as principal or with a solicited order at the better of the NBBO

\9\ or the Agency Order's limit price (if the order is a limit order);

and (iii) with respect to Agency Orders that have a size of less than

50 contracts, if at the time of receipt of the Agency Order, the NBBO

has a bid/ask differential of $0.01, the System \10\ will reject the

Agency Order.\11\ Members may use PRIME to execute complex orders at a

net price. ``cPRIME'' is the process by which a Member may

electronically submit a ``cPRIME Order'' (as defined in Rule 518(b)(7))

it represents as agent (a ``cPRIME Agency Order'') against principal or

solicited interest for execution (a ``cPRIME Auction''), subject to the

criteria enumerated in Policy .12 of Rule 515A.\12\

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\7\ The term ``Member'' means an individual or organization

approved to exercise the trading rights associated with a Trading

Permit. Members are deemed ``members'' under the Exchange Act. See

Exchange Rule 100.

\8\ See Exchange Rule 515A(a).

\9\ The term ``NBBO'' means the national best bid or offer as

calculated by the Exchange based on market information received by

the Exchange from OPRA. See Exchange Rule 100. The term ``OPRA''

means the Options Price Reporting Authority, LLC. See Exchange Rule

100.

\10\ The term ``System'' means the automated trading system used

by the Exchange for the trading of securities. See Exchange Rule

100.

\11\ See Exchange Rule 515A(a)(1).

\12\ See Exchange Rule 515A.12(a).

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Currently, Policy .04 of Rule 515A provides that Members may enter

contra orders that are solicited. The PRIME provides a facility for

Members that locate liquidity for their customer orders. Members may

not use the Solicitation Auction to circumvent Rule 520 limiting

principal transactions. This may include, but is not limited to,

Members entering contra orders that are solicited from (a) affiliated

broker-dealers, or (b) broker-dealers with which the Member has an

arrangement that allows the Member to realize similar economic benefits

from the solicited transaction as it would achieve by executing the

customer order in whole or in part as principal. Additionally,

solicited contra orders entered by Members to trade against Agency

Orders may not be for the account of a MIAX Market Maker assigned to

the options class.\13\

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\13\ See Policy .04 of Exchange Rule 515A.

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The last sentence of Policy .04 of Rule 515A prohibits orders for

the accounts of Market Makers assigned to the applicable options class

on the Exchange to be solicited to execute against the Agency Order in

a PRIME or cPRIME Auction. While market participants other than

appointed MIAX Market Makers may contribute liquidity to these crossing

auctions as either contra orders or responses, Market Makers assigned

to the options class, who are the primary source of liquidity on the

Exchange in their assigned options class, are limited in the manner in

which they may provide liquidity to these auctions.

The Exchange believes that eliminating the prohibition against

assigned Market Makers acting as contra in PRIME and cPRIME Auctions

would enhance price improvement opportunities. Allowing the assigned

Market Maker in the options class to be solicited as a contra party may

result in exposure of more orders to potential price improvement via

the auction processes.

Further, the Exchange notes that the electronic crossing price

improvement auction of at least one other options exchange currently

permits orders for the accounts of appointed market-makers to be

solicited as the contra for that auction.\14\

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\14\ See Securities Exchange Act Release No.105049 (March 19,

2026), 91 FR 14057 (March 24, 2026) (SR-CBOE-2025-090) (Order

Approving a Proposed Rule Change To Permit Orders for the Accounts

of Market-Makers With an Appointment in the Applicable Class To Be

Solicited as the Contra-Side Order Submitted Into Certain Exchange

Auctions).

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Implementation

The Exchange proposes to implement this functionality in Q3 of 2026

and will issue a Regulatory Circular notifying market participants of

the implementation date at least 30 days prior.

2. Statutory Basis

The Exchange believes that the proposed rule change is consistent

with Section 6(b) of the Act,\15\ in general, and furthers the

objectives of Section 6(b)(5) of the Act,\16\ in particular, in that it

is designed to prevent fraudulent and manipulative acts and practices,

to promote just and equitable principles of trade, to foster

cooperation and coordination with persons engaged in regulating,

clearing, settling, processing information with respect to, and

facilitating transactions in securities, to remove impediments to and

perfect the mechanism of a free and open market and a national market

system, and, in general, to protect investors and the public interest.

The Exchange also believes the proposed rule change is consistent with

the Section 6(b)(5) \17\ requirement that the rules of an exchange not

be designed to permit unfair discrimination between customers, issuers,

brokers, or dealers.

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\15\ 15 U.S.C. 78f(b).

\16\ 15 U.S.C. 78f(b)(5).

\17\ Id.

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In particular, the Exchange believes the proposed rule change will

promote just and equitable principles of trade and remove impediments

to and perfect the mechanisms of a free and open market and a national

market system because it will provide the primary liquidity providers

on the Exchange with an additional way to participate in electronic

auctions. Additionally, by permitting Members to solicit primary

liquidity providers in a class for

[[Page 33013]]

electronic auctions, the Exchange believes Members will be able to more

efficiently locate liquidity to fill their customer orders,

particularly during times of volatility. As a result, the Exchange

believes the proposed rule change will likely expand available

liquidity for these auctions, which may create additional execution and

price improvement opportunities for customers at all times, which

ultimately benefits investors.

The Exchange believes the proposed rule change will promote

competition in PRIME and cPRIME Auctions, including competition to

initiate PRIME and cPRIME Auctions, which will remove impediments to

and perfect the mechanism of a free and open market and a national

market system, and, in general, protect investors. The Exchange

believes the availability of this liquidity to Agency Orders will

positively affect the experience for Agency Orders and overall quality

of the auctions, and may increase the number of PRIME and cPRIME

Auctions being initiated. Furthermore, the Exchange believes increasing

the number of market participants available to be solicited may

increase competition to provide Agency Orders, which may lead to a

PRIME Auction being initiated at a better price. More market

participants competing to provide Agency Orders may lead to solicited

parties providing more aggressive initial prices. The Exchange believes

the ability of all market participants, including assigned Market

Makers that did not submit an Agency Order, to submit responses to a

PRIME Auction will continue to provide competition for executions

against these Agency Orders.

The Exchange believes any risk that appointed Market Makers may

misuse the non-public information of an upcoming PRIME or cPRIME

Auction is de minimis. Currently, that risk is present for non-

appointed Market Makers, but the Exchange has not observed any trends

of solicited market participants separately submitting unrelated orders

as a result of knowledge of impending PRIME or cPRIME Auctions in other

classes. The Exchange notes that Policy .01 of Exchange Rule 515A

provides that it shall be considered conduct inconsistent with just and

equitable principles of trade, in accordance to Exchange Rule 301 \18\

for any Member to enter orders, quotes, Agency Orders, or other

responses for the purpose of disrupting or manipulating the

Auction.\19\ Additionally, Exchange Rule 303 provides that each Member

must establish, maintain and enforce written procedures reasonably

designed, taking into consideration the nature of such Member's

business, to prevent the misuse of material, non-public information by

such Member or persons associated with such Member.\20\

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\18\ See Exchange Rule 301.

\19\ See Interpretations and Policies .01 of Exchange Rule 515A.

\20\ See Exchange Rule 303.

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The Exchange believes the proposed rule change is not designed to

permit unfair discrimination between customers, issuers, brokers, or

dealers because it will permit orders for accounts of assigned Market

Makers to be solicited in the same manner as orders for the accounts or

all other market participants. Currently, all market participants,

other than assigned Market Makers, may be solicited as the contra and

submit responses in PRIME Auctions for all classes. Given the

additional costs and obligations associated with being an assigned

Market Maker, the Exchange does not believe these Market Makers should

have fewer execution opportunities with respect to volume submitted for

execution through PRIME Auctions. The Exchange believes the proposed

rule change will provide all Market Makers on the Exchange with the

same ability to participate in PRIME Auctions in all classes at all

times, which may further increase execution and price improvement

opportunities for customers.

B. Self-Regulatory Organization's Statement on Burden on Competition

The Exchange does not believe that the proposed rule change will

impose any burden on competition that is not necessary or appropriate

in furtherance of the purposes of the Act. The Exchange does not

believe the proposed rule change will impose any burden on intramarket

competition that is not necessary or appropriate in furtherance of the

purposes of the Act because it provides the same execution

opportunities in PRIME Auctions to assigned Market Makers that are

currently available to all other market participants.

The Exchange does not believe the proposed rule change will impose

any burden on intermarket competition that is not necessary or

appropriate in furtherance of the purposes of the Act because it

relates to orders submitted into the PRIME Auction mechanism on the

Exchange. Additionally, the Exchange notes that the rules of at least

one other options exchange permits orders for the accounts of appointed

market makers to be solicited as contra orders for that exchange's

electronic crossing price improvement auction.\21\ The Exchange

believes the proposed rule change may improve price competition with

PRIME Auctions, because the primary liquidity providers will be able to

increase participation in PRIME Auctions.

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\21\ See supra note 14.

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For all the reasons stated, the Exchange does not believe that the

proposed rule change will impose any burden on competition not

necessary or appropriate in furtherance of the purposes of the Act, and

believes the proposed change will enhance competition.

C. Self-Regulatory Organization's Statement on Comments on the Proposed

Rule Change Received From Members, Participants, or Others

Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for

Commission Action

Pursuant to Section 19(b)(3)(A) of the Act \22\ and Rule 19b-

4(f)(6) \23\ thereunder, the Exchange has designated this proposal as

one that effects a change that: (i) does not significantly affect the

protection of investors or the public interest; (ii) does not impose

any significant burden on competition; and (iii) by its terms, does not

become operative for 30 days after the date of the filing, or such

shorter time as the Commission may designate if consistent with the

protection of investors and the public interest.

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\22\ 15 U.S.C. 78s(b)(3)(A).

\23\ 17 CFR 240.19b-4(f)(6).

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At any time within 60 days of the filing of the proposed rule

change, the Commission summarily may temporarily suspend such rule

change if it appears to the Commission that such action is necessary or

appropriate in the public interest, for the protection of investors, or

otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

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 any of

the following methods:

Electronic Comments

Use the Commission's internet comment form ( https://www.sec.gov/rules/sro.shtml ); or

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Send an email to [email protected] . Please include

file number SR-MIAX-2026-21 on the subject line.

Paper Comments

Send paper comments in triplicate to Secretary, Securities

and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to file number SR-MIAX-2026-21. This file

number should be included on the subject line if email is used. To help

the Commission process and review your comments more efficiently,

please use only one method. The Commission will post all comments on

the Commission's internet website ( https://www.sec.gov/rules/sro.shtml ). Copies of the filing will be available for inspection and

copying at the principal office of the Exchange. Do not include

personal identifiable information in submissions; you should submit

only information that you wish to make available publicly. We may

redact in part or withhold entirely from publication submitted material

that is obscene or subject to copyright protection. All submissions

should refer to file number SR-MIAX-2026-21 and should be submitted on

or before June 23, 2026.

For the Commission, by the Division of Trading and Markets,

pursuant to delegated authority.\24\

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\24\ 17 CFR 200.30-3(a)(12).

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Sherry R. Haywood,

Assistant Secretary.

[FR Doc. 2026-10952 Filed 6-1-26; 8:45 am]

BILLING CODE 8011-01-P