80 FR 11713 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the NYSE Arca Options Fee Schedule

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 42 (March 4, 2015)

[Federal Register Volume 80, Number 42 (Wednesday, March 4, 2015)]
[Notices]
[Pages 11713-11715]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-04422]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74382; File No. SR-NYSEARCA-2015-10]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending the NYSE 
Arca Options Fee Schedule

February 26, 2015.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on February 18, 2015, NYSE Arca, Inc. (the ``Exchange'' or 
``NYSE Arca'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the self-regulatory 
organization. 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\ 15 U.S.C. 78a.
    \3\ 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 the NYSE Arca Options Fee Schedule 
(``Fee Schedule'') by adding to the Fee Schedule information regarding 
the number of option issues a Market Maker may have in their assignment 
in relation to the number of OTPs a Market Maker has. The text of the 
proposed rule change is available on the Exchange's Web site at 
www.nyse.com, at the principal office of the Exchange, and at the 
Commission's Public Reference Room.

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 self-regulatory organization 
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

[[Page 11714]]

of those statements may be examined at the places specified in Item IV 
below. The Exchange has prepared summaries, set forth in sections A, B, 
and C below, of the most significant parts 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 the Fee Schedule by adding to the 
Fee Schedule information from Rule 6.35(d)(1)-(4) regarding the number 
of options issues a Market Maker may have in its assignment in relation 
to the number of OTPs a Market Maker has.
    The Fee Schedule sets forth the fees and charges that participants 
on the Exchange can be expected to pay. However, NYSE Arca Market 
Makers need to refer to Rule 6.35 (d)(1) to (4) to ascertain the number 
of OTPs they are required to have depending on the number of option 
issues in their assignment. The Exchange is proposing to include this 
information in the Fee Schedule so that Market Makers have a single 
reference point to ascertain fees associated with their activities on 
the Exchange.\4\ In particular, because the Exchange charges a fee for 
each OTP assigned to an OTP Holder or OTP Firm (``OTPs''), the rule 
text identifies the fee structure by setting forth the number of 
trading permits that are required of OTPs acting as Market Makers 
according to the number of options issues included in their 
appointment.
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    \4\ See e.g., NYSE Amex Options Fee Schedule, available here 
[sic], (Section III.A., Monday [sic] ATP Fees). See also Securities 
and Exchange Act Release No. 67505 (July 26, 2012), 77 FR 45292 
[sic] (July 31, 2012) (SR-NYSEMKT-2012-24) (filing for immediate 
effectiveness to add information regarding ATP Fees previously found 
in NYSE Arca Rule 923NY(d)(1)-(4) [sic] to Fee Schedule).
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    Rule 6.35 (d)(1) to (4) sets forth the trading appointments of 
participants acting as Market Makers on the Exchange as follows:
    (1) Market Makers with 1 OTP may have up to 100 option issues 
included in their appointment.
    (2) Market Makers with 2 OTPs may have up to 250 option issues 
included in their appointment.
    (3) Market Makers with 3 OTPs may have up to 750 option issues 
included in their appointment.
    (4) Market Makers with 4 OTPs may have all option issues traded on 
the Exchange included in their appointment.
    The Exchange proposes to add the information from Rule 6.35(d)(1)-
(4) to the Fee Schedule under ``NYSE Arca GENERAL OPTIONS and TRADING 
PERMIT (OTP) FEES,'' subsection ``NYSE Arca Market Makers.'' Because 
the current fee schedule sets forth the monthly OTP Fees for NYSE Arca 
Market Makers, the Exchange proposes to delete this text and add the 
substance of the OTP fees back in a table format, together with the 
number of option issues permitted in a Market Maker's assignment 
depending on the OTPs held by such Market Maker as set forth in Rule 
6.35(d)(1)-(4). The proposed fee schedule would read as follows:
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    \5\ The Commission notes that the Exhibit 5 submitted with this 
proposed rule change says ``Number of Options Issues Permitted in 
Market Makers Assignment.''

------------------------------------------------------------------------
                                             Number of issues  permitted
            Monthly fee per OTP                 \5\ in Market Maker's
                                               quoting assignmentmaker
------------------------------------------------------------------------
$6,000 for 1st OTP........................  Up to 100 option issues.
$5,000 for the 2nd OTP....................  Up to 250 option issues.
$4,000 for the 3rd OTP....................  Up to 750 option issues.
$3,000 for the 4th OTP....................  All option issues traded on
                                             the Exchange.
$1,000 for the 5th and additional OTPs....  All option issues traded on
                                             the Exchange.
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    The Exchange is not proposing any change in the number of OTPs 
required by Market Makers. The Exchange believes its proposed change 
would make the Fee Schedule more comprehensive, thereby better 
informing members.\6\
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    \6\ Following effectiveness of this proposal, the Exchange plans 
to file an amendment to Rule 6.35 (Market Maker Appointments), which 
would include replacing the text of Rule 6.35(d)(1)-(4) with a 
reference to the Fee Schedule. The proposed change to the Fee 
Schedule is not contingent upon effectiveness of the changes to Rule 
6.35. Until any changes are made to Rule 6.35, the information about 
the number of option issues permitted in a Market Maker's assignment 
in relation to the number of OTPs it holds will appear in both the 
Fee Schedule and Rule 6.35.
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    For consistency, the Exchange also proposes to make a non-
substantive formatting change to how it presents and formats the 
information related to OTP fees for Floor Brokers, Office, and Clearing 
Firms to align with the proposed changes to Market Maker OTP fees. The 
Exchange believes this proposed change would add clarify [sic] and 
consistency to the Fee Schedule.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Securities Exchange Act of 1934 (the 
``Act''),\7\ in general, and furthers the objectives of Section 6(b)(4) 
of the Act,\8\ in particular, because it provides for the equitable 
allocation of reasonable dues, fees, and other charges among its 
members, issuers and other persons using its facilities and does not 
unfairly discriminate between customers, issuers, brokers or dealers.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that the proposed change is reasonable, 
equitable and not unfairly discriminatory because including in the Fee 
Schedule the number of permits required of OTP Holders and OTP Firms 
acting as Market Makers on the Exchange from Rule 6.35 (d)(1) through 
(4) improves the clarity and transparency of the Fee Schedule, which is 
to the benefit of all market participants who would be better able to 
understand the basis for Exchange fees.
    The Exchange believes that the proposed non-substantive formatting 
changes, including to re-organize how it presents information regarding 
OTP fees (e.g., streamlined information from current rule text, 
together with information from Rule 6.35(d)(1)-(4)), would likewise add 
to the clarity, transparency and comprehensibility of the Fee Schedule 
to the benefit of all market participants.

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. As noted above, the Exchange 
believes the proposed change will enhance to [sic] comprehensibility of 
the Fee Schedule to the benefit of all market participants, which is 
pro-competitive.
    The Exchange notes that it operates in a highly competitive market 
in which market participants can readily favor competing venues. In 
such an environment, the Exchange must continually review, and consider 
adjusting, its fees and credits to remain competitive with other 
exchanges. For the reasons described above, the Exchange believes that 
the proposed rule change reflects this competitive environment.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

[[Page 11715]]

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

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \9\ of the Act and subparagraph (f)(2) of Rule 19b-
4\10\ thereunder, because it establishes a due, fee, or other charge 
imposed by the Exchange.
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of such 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. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \11\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \11\ 15 U.S.C. 78s(b)(2)(B).
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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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEARCA-2015-10 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-NYSEARCA-2015-10. 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 Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for Web site 
viewing and printing in the Commission's Public Reference Room, 100 F 
Street NE., Washington, DC 20549, on official business days between the 
hours of 10:00 a.m. and 3:00 p.m. Copies of the filing will also be 
available for inspection and copying at the NYSE's principal office and 
on its Internet Web site at www.nyse.com. All comments received will be 
posted without change; the Commission does not edit personal 
identifying information from submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NYSEARCA-2015-10, and should be 
submitted on or before March 25, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2015-04422 Filed 3-3-15; 8:45 am]
BILLING CODE 8011-01-P