Cboe BYX deletes information-circular requirement for UTP derivatives
The rule change, effective Sept. 30, 2026, binds BYX members trading UTP derivative securities
On September 30, 2026, Cboe BYX Exchange, Inc. filed a proposed rule change with the Securities and Exchange Commission that becomes effective immediately. The filing, identified as Release No. 34-106646 and File No. SR-CboeBYX-2026-038 (FR Doc No. 2026-21126), amends Rule 14.1 of the Exchange's rulebook.
The amendment deletes Rule 14.1(c)(1) in its entirety, eliminating the Exchange's obligation to distribute an information circular to members before the start of trading in each unlisted-trading-privilege (UTP) derivative security. It adds express cross-references in Rule 14.1(a) to Rules 3.7 and 3.21, amends Rule 14.1(c)(2)(B) to require that any written description be provided in a form approved by the listing exchange or prepared by the open-ended management company issuing the security, renumbers the remaining sub-rules as 14.1(c)(1) through (4), and updates the cross-reference in Interpretations and Policies .01.
The Exchange states the change is intended to remove a duplicative disclosure step because the primary listing exchange already issues an information circular containing the same risk and procedural disclosures. Members can rely on that circular, while the existing member-level suitability and customer-disclosure obligations in Rules 3.7 and 3.21 continue to apply independently.
The proposal is filed under Section 19(b)(1) of the Securities Exchange Act of 1934 and is asserted to be consistent with Section 6(b)(5) of the Act, which requires exchange rules to prevent fraud, promote equitable trade, and avoid unfair discrimination. The Exchange argues that the amendment furthers those statutory goals by streamlining disclosures without compromising investor protection.
The Commission is soliciting comments on the proposed change. The filing, the text of the amendment, and related materials are available on the SEC's website (https://www.sec.gov/rules/sro.shtml), the BYX website (https://www.cboe.com/us/equities/regulation/rule_filings/byx/), and at the Exchange's principal office.
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