Nasdaq GEMX proposes to make primary market maker appointments optional

On September 2, 2026, Nasdaq GEMX, LLC filed a proposed rule change with the Securities and Exchange Commission, and the filing became effective immediately, as noted in the Federal Register notice (Vol. 91, No. 180, pages 59234-59236; FR Doc No. 2026-19129; Release No. 34-106386; File No. SR-GEMX-2026-32). The Commission is seeking comments on the proposal.

The amendment would revise Options 2, Section 3, paragraph (b) to replace the current mandatory requirement that a Primary Market Maker (PMM) be appointed to each options class with language allowing a PMM to be appointed at the Exchange's discretion. The proposal does not alter the substantive obligations of a PMM once appointed, including the 90% two-sided quoting requirement and the Valid Width Quote requirement. Competitive Market Makers (CMMs), which must provide two-sided quotations in 60% of the series in each options class, would continue to supply liquidity where no PMM is appointed.

The Exchange cites consistency with Section 6(b) of the Securities Exchange Act of 1934 and alignment with Nasdaq Phlx's Options 2, Section 12(a), which likewise permits but does not require a Lead Market Maker. The filing notes that until July 2026, the Nasdaq Options Market did not adopt a comparable market-maker category, operating without a PMM requirement for nearly two decades.

The Exchange states that the change imposes no additional burden on competition, noting that existing PMM members retain their appointments and obligations, and that CMMs remain subject to the same quoting standards. By providing flexibility to determine PMM appointments on a class-by-class basis, the Exchange aims to enhance its ability to compete for order flow with other options markets.

Comments on the proposed rule change must be submitted to the Commission in accordance with the procedures outlined in the notice.