80 FR 15646 - Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Schedule of Fees
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 56 (March 24, 2015)
Federal Register Volume 80, Issue 56 (March 24, 2015)
| Page Range | 15646-15650 | |
| FR Document | 2015-06621 |
[Federal Register Volume 80, Number 56 (Tuesday, March 24, 2015)] [Notices] [Pages 15646-15650] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-06621] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-74525; File No. SR-ISE-2015-09] Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Schedule of Fees March 18, 2015. 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 March 12, 2015, the International Securities Exchange, LLC (the ``Exchange'' or the ``ISE'') 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. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The ISE proposes to amend the Schedule of Fees as described in more detail below. The text of the proposed rule change is available on the Exchange's Web site (http://www.ise.com), at the principal office of [[Page 15647]] 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 of these statements may be examined at the places specified in Item IV below. The self-regulatory organization 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 the Schedule of Fees to (1) provide more favorable Priority Customer \3\ complex order rebates, (2) charge all legs for complex Crossing Orders,\4\ (3) apply Foreign Exchange (``FX'') Option fees and rebates to complex orders in FX Option Symbols,\5\ including Early Adopter FX Option Symbols,\6\ and (4) eliminate the Market Maker Plus \7\ large size rebate for BAC, SPY, and IWM. Each of the proposed changes is described in more detail below. --------------------------------------------------------------------------- \3\ A ``Priority Customer'' is a person or entity that is not a broker/dealer in securities, and does not place more than 390 orders in listed options per day on average during a calendar month for its own beneficial account(s), as defined in Rule 100(a)(37A). \4\ A ``Crossing Order'' is an order executed in the Exchange's Facilitation Mechanism, Solicited Order Mechanism, Price Improvement Mechanism (``PIM'') or submitted as a Qualified Contingent Cross (``QCC'') order. For purposes of the fee schedule, orders executed in the Block Order Mechanism are also considered Crossing Orders. \5\ ``FX Option Symbols'' are options overlying AUM, GBP, EUU and NDO. \6\ ``Early Adopter FX Option Symbols'' are options overlying NZD, PZO, SKA, BRB, AUX, BPX, CDD, EUI, YUK and SFC. \7\ A Market Maker Plus is a Market Maker who is on the National Best Bid or National Best Offer at least 80% of the time for series trading between $0.03 and $3.00 (for options whose underlying stock's previous trading day's last sale price was less than or equal to $100) and between $0.10 and $3.00 (for options whose underlying stock's previous trading day's last sale price was greater than $100) in premium in each of the front two expiration months. A Market Maker's single best and single worst quoting days each month based on the front two expiration months, on a per symbol basis, will be excluded in calculating whether a Market Maker qualifies for the Market Maker Plus rebate, if doing so will qualify a Market Maker for the rebate. --------------------------------------------------------------------------- 1. Priority Customer Complex Order Rebates The Exchange currently provides volume-based tiered rebates for Priority Customer complex orders when these orders trade with non- Priority Customer orders in the complex order book, or trade with quotes and orders on the regular order book. These complex order rebates are provided to members based on the member's average daily volume (``ADV'') in Priority Customer complex orders in six volume tiers as follows: 0 to 29,999 contracts (Tier 1), 30,000 to 74,999 contracts (Tier 2), 75,000 to 124,999 contracts (Tier 3), 125,000 to 224,999 contracts (Tier 4), 225,000 to 299,999 contracts (Tier 5), and 300,000 or more contracts (Tier 6).\8\ The Exchange now proposes to decrease the volume requirements necessary for achieving higher Priority Customer complex order rebates. The proposed ADV thresholds are as follows: 0 to 29,999 contracts (Tier 1), 30,000 to 59,999 contracts (Tier 2), 60,000 to 99,999 contracts (Tier 3), 100,000 to 149,999 contracts (Tier 4), 150,000 to 199,999 contracts (Tier 5), and 200,000 or more contracts (Tier 6). --------------------------------------------------------------------------- \8\ The rebate for the highest tier volume achieved is applied retroactively to all Priority Customer Complex volume once the threshold has been reached. For purposes of determining Priority Customer Complex ADV, any day that the complex order book is not open for the entire trading day may be excluded from such calculation; provided that the Exchange will only remove the day for members that would have a lower ADV with the day included. --------------------------------------------------------------------------- In addition, the Exchange proposes to increase the rebates provided for Priority Customer complex orders. Currently, Priority Customer complex orders receive a rebate of $0.30 per contract in Select Symbols \9\ and $0.63 per contract in Non-Select Symbols \10\ for Tier 1, $0.35 per contract in Select Symbols and $0.71 per contract in Non-Select Symbols for Tier 2, $0.39 per contract in Select Symbols and $0.75 per contract in Non-Select Symbols for Tier 3, $0.41 per contract in Select Symbols and $0.80 per contract in Non-Select Symbols for Tier 4, $0.43 per contract in Select Symbols and $0.82 per contract in Non-Select Symbols for Tier 5, and $0.45 per contract in Select Symbols and $0.83 per contract in Non-Select Symbols for Tier 6.\11\ The Exchange now proposes to increase the rebate in Select Symbols to $0.40 per contract for Tier 3, $0.43 per contract for Tier 4, $0.45 per contract for Tier 5, and $0.46 per contact for Tier 6. For Non-Select Symbols the rebate will be increased to $0.78 per contract for Tier 3. Other rebate amounts will remain unchanged from their current levels. --------------------------------------------------------------------------- \9\ ``Select Symbols'' are options overlying all symbols listed on the ISE that are in the Penny Pilot Program. \10\ ``Non-Select Symbols'' are options overlying all symbols excluding Select Symbols. \11\ These rebates are provided per contract per leg if the order trades with non-Priority Customer orders in the complex order book, or trades with quotes and orders on the regular order book. --------------------------------------------------------------------------- 2. Fee for Complex Crossing Orders The Exchange charges Market Maker,\12\ Non-ISE Market Maker,\13\ Firm Proprietary \14\/Broker-Dealer,\15\ and Professional Customer \16\ orders a fee for complex Crossing Orders of $0.20 per contract. This fee applies to complex Crossing Orders except for PIM orders of 100 or fewer contracts (which are subject to a separate fee) and is charged for all legs for PIM orders and for the largest leg only for all other Crossing Orders. The Exchange now proposes to charge for all legs for all Crossing Orders, including QCC orders and orders entered into the PIM, Facilitation, Block and Solicited Order Mechanisms. Firm Proprietary and Non-ISE Market Maker contracts traded will remain subject to the Crossing Fee Cap, as provided in Section IV.H.\17\ --------------------------------------------------------------------------- \12\ The term ``Market Makers'' refers to ``Competitive Market Makers'' and ``Primary Market Makers'' collectively. See Rule 100(a)(25). \13\ A ``Non-ISE Market Maker'' is a market maker as defined in Section 3(a)(38) of the Securities Exchange Act of 1934, as amended, registered in the same options class on another options exchange. \14\ A ``Firm Proprietary'' order is an order submitted by a member for its own proprietary account. \15\ A ``Broker-Dealer'' order is an order submitted by a member for a broker-dealer account that is not its own proprietary account. \16\ A ``Professional Customer'' is a person or entity that is not a broker/dealer and is not a Priority Customer. \17\ The Exchange notes that the relevant citation to the Crossing Fee Cap currently refers mistakenly to Section VI, which was renumbered Section IV in connection with the delisting of Mini Options on ISE, and also uses a previous name ``Firm Fee Cap''. The Exchange proposes to update this section and make corresponding changes to other outdated references to the Crossing Fee Cap, as well as to Market Maker Discount Tiers, which are both now located in Section IV. --------------------------------------------------------------------------- 3. Complex FX Option Fees and Rebates ISE charges fees and provides rebates for orders in FX Option Symbols, including Early Adopter FX Option Symbols, executed on the Exchange. While the Schedule of Fees has separate fees and rebates in Section III applicable to simple orders in FX option classes, the complex order fees and rebates for Non-Select Symbols in Section II currently apply to complex orders in these symbols. The Exchange now proposes to apply the FX option fees and rebates in Section III to all trades executed in FX option classes, including both simple and complex orders. The [[Page 15648]] proposed fees, which already apply to simple orders in FX option classes, are briefly described below. Maker/Taker Fees and Rebates: Currently, non-Priority Customer complex orders in FX option classes are charged a fee for removing liquidity that ranges from $0.85 per contract for Market Maker orders to $0.87 per contract for Non-ISE Market Maker, Firm Proprietary/ Broker-Dealer and Professional Customer orders. The same rates similarly apply when these market participants provide liquidity to Priority Customer orders. Otherwise, the applicable maker fee is $0.10 per contract for Market Maker, Firm Proprietary/Broker-Dealer, and Professional Customer orders and $0.20 per contract for Non-ISE Market Maker orders. Priority Customer complex orders are not currently charged a fee for adding or removing liquidity in FX option classes. Instead, these orders are eligible for a tiered volume based rebate of $0.63 per contract to $0.83 per contract when trading with non-Priority Customer orders in the complex order book, or trading with quotes and orders on the regular order book. With the proposed change, members will pay a fee, regardless of adding or removing liquidity, of $0.22 per contract for Market Maker orders (subject to tier discounts),\18\ $0.20 for Market Maker orders sent by an Electronic Access Member (``EAM''), $0.45 per contract for Non-ISE Market Maker orders, $0.30 per contract for Firm Proprietary/Broker-Dealer and Professional Customer orders, and $0.40 per contract for Priority Customer orders. Early Adopter Market Makers participate in a revenue sharing arrangement as described in footnote 2 to Section III, and will not be liable for FX option fees. --------------------------------------------------------------------------- \18\ The Exchange proposes to clarify in Section IV.C., which describes the relevant market maker discount tiers, that both simple and complex orders in FX options classes are now subject to these tiers pursuant to footnote 3 of Section III. --------------------------------------------------------------------------- Fee for Crossing Orders: Currently, non-Priority Customer complex orders in FX option classes are charged a fee for Crossing Orders of $0.20 per contract, or $0.03 to $0.05 per contract for PIM orders of 100 or fewer contracts. With the proposed change, the fee for Crossing Orders in FX option classes will be $0.22 per contract for Market Maker orders (subject to tier discounts),\19\ $0.20 per contract for Market Maker orders sent by an EAM, Non-ISE Market Maker orders, Firm Proprietary/Broker-Dealer orders, and Professional Customer orders, and, finally, $0.40 per contract for Priority Customer orders. For PIM orders of 100 or fewer contracts, the proposed fee would be $0.03 to $0.05 per contract for non-Priority Customer orders and $0.40 per contract for Priority Customer orders. Again, Early Adopter Market Makers will not be charged a fee. --------------------------------------------------------------------------- \19\ See id. --------------------------------------------------------------------------- Response Fees and Break-Up Rebates: Currently, the fee for responses to complex Crossing Orders in FX option classes is $0.90 per contract for Market Maker orders and $0.95 per contract for all other market participants. Non-Market Maker orders also receive a PIM break- up rebate of $0.80 per contract. With the proposed change, all market participants, except for Early Adopter Market Makers, will pay a fee for responses to complex Crossing Orders in FX option classes of $0.45 per contract. In addition, non-Market Maker complex orders in these symbols will be eligible for a PIM break-up rebate of $0.15 per contract. 4. Market Maker Plus Large Size Rebate for BAC, SPY, and IWM In order to promote and encourage liquidity in Select Symbols, the Exchange currently offers Market Makers who meet the quoting requirements for Market Maker Plus enhanced rebates for adding liquidity in those symbols. In May 2014, the Exchange introduced a new Market Maker Plus rebate for members that meet specified quotation size requirements on a trade by trade basis in three actively traded Select Symbols: BAC, SPY, and IWM.\20\ In particular, Market Makers who qualify as Market Maker Plus in BAC, SPY, and IWM currently earn a rebate of $0.25 per contract if at the time of the trade their displayed quantity, in the traded series, is at least 1,000 contracts. The Exchange now proposes to eliminate this Market Maker Plus large size rebate. --------------------------------------------------------------------------- \20\ See Securities Exchange Act Release No. 72163 (May 14, 2014), 79 FR 28985 (May 20, 2014) (SR-ISE-2014-27). --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,\21\ in general, and Section 6(b)(4) of the Act,\22\ in particular, in that it is designed to provide for the equitable allocation of reasonable dues, fees, and other charges among its members and other persons using its facilities. --------------------------------------------------------------------------- \21\ 15 U.S.C. 78f. \22\ 15 U.S.C. 78f(b)(4). --------------------------------------------------------------------------- 1. Priority Customer Complex Order Rebates The Exchange believes that it is reasonable and equitable to decrease the volume requirements necessary to achieve the Priority Customer complex order rebates, and increase the rebate amounts, as these proposed changes are designed to attract additional Priority Customer complex order volume to the Exchange. The Exchange already provides volume-based tiered rebates for Priority Customer complex orders, and believes that increasing the rebates and lowering the associated volume thresholds will incentivize members to send additional order flow to the ISE in order to achieve these rebates for their Priority Customer complex order volume, creating additional liquidity to the benefit of all members that trade complex orders on the Exchange. The Exchange further believes that it is equitable and not unfairly discriminatory to continue to provide a rebate only for Priority Customer complex orders. A Priority Customer is by definition not a broker or dealer in securities, and does not place more than 390 orders in listed options per day on average during a calendar month for its own beneficial account(s). This limitation does not apply to participants whose behavior is substantially similar to that of market professionals, including Professional Customers, who will generally submit a higher number of orders (many of which do not result in executions) than Priority Customers. 2. Fee for Complex Crossing Orders The Exchange believes that it is reasonable and equitable to charge for all legs for all Crossing Orders, including QCC orders and orders entered into the PIM, Facilitation, Block and Solicited Order Mechanisms. While this is a fee increase for members that execute complex Crossing Orders (other than PIM orders), the Exchange believes that this change is warranted as the current practice effectively discounts the fee charged for complex Crossing Orders to zero after the largest leg, effectively subsidizing complex Crossing Orders with numerous legs. The Exchange no longer believes that this subsidy is appropriate, and has therefore chosen to discontinue it for all complex Crossing Orders as it has already done for PIM orders. The Exchange does not believe that this proposed change is unfairly discriminatory as it would apply equally to all market participants that trade complex Crossing Orders on the Exchange. 3. Complex FX Option Fees The Exchange believes that it is reasonable and equitable to charge the same fees for complex orders in FX Option Symbols and Early Adopter FX Option Symbols as the Exchange [[Page 15649]] currently charges for simple orders in these symbols. The Exchange believes that the current table of FX option fees and rebates in Section III of the Schedule of Fees is appropriate for both simple and complex orders.\23\ Charging the same fees across the board in these proprietary products will simplify the Schedule of Fees to the benefit of members and investors. The Exchange does not believe that this proposed change is unfairly discriminatory as members are already assessed fees and rebates for simple orders in FX option classes based on Section III of the Schedule of Fees. The proposed change will merely ensure that these members pay the same fees for complex orders in these symbols as well. For the majority of market participants this means that fees will be lower, and in some cases significantly lower. Certain fees, including, for example, fees charged for Priority Customer orders, however, will be increased with the proposed change. While Priority Customer orders generally receive several benefits for trading on ISE, the Exchange does not believe that it is unfairly discriminatory to reduce some of those benefits here. In this regard, the Exchange notes that the proposed fee for Priority Customer complex FX option orders is within the range of fees currently charged by some of the Exchange's competitors, including NASDAQ OMX PHLX, LLC (``Phlx'').\24\ Similarly, the Exchange notes that PIM break-up rebates would be reduced with the proposed rule change. The Exchange believes that this is reasonable, equitable, and not unfairly discriminatory as the proposed break-up rebates are set at a level that the Exchange believes will continue to provide an appropriate incentive for members. --------------------------------------------------------------------------- \23\ The Exchange notes that the proposed change to Section IV.C. is intended solely to clarify that market maker discount tiers will be extended to complex orders in FX option classes consistent with the meaning of footnote 3 to Section III. \24\ See Phlx Pricing Schedule, Section III, Singly Listed Options. --------------------------------------------------------------------------- 4. Market Maker Plus Large Size Rebate for BAC, SPY, and IWM The Exchange believes that it is reasonable, equitable, and not unfairly discriminatory to eliminate the Market Maker Plus large size rebate as the Exchange does not believe that this program has satisfied its intended goals. When ISE introduced this program, the Exchange was hopeful that the higher rebate would encourage Market Makers to post deeper size in these actively traded symbols. After running this program for several months, the Exchange does not believe that the large size rebate has been an effective incentive for Market Makers. The Exchange therefore believes that it is appropriate to discontinue the large size rebate at this time. B. Self-Regulatory Organization's Statement on Burden on Competition In accordance with Section 6(b)(8) of the Act,\25\ the Exchange does not believe that the proposed rule change will impose any burden on intermarket or intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Act. The transaction fee changes amend various fees and rebates and are designed to attract additional order flow to the Exchange. The Exchange believes that the proposed fees and rebates are competitive with fees and rebates offered to orders executed on other options exchanges. The Exchange operates in a highly competitive market in which market participants can readily direct their order flow to competing venues. In such an environment, the Exchange must continually review, and consider adjusting, its fees and rebates to remain competitive with other exchanges. For the reasons described above, the Exchange believes that the proposed fee changes reflect this competitive environment. --------------------------------------------------------------------------- \25\ 15 U.S.C. 78f(b)(8). --------------------------------------------------------------------------- C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act \26\ and subparagraph (f)(2) of Rule 19b-4 thereunder,\27\ because it establishes a due, fee, or other charge imposed by ISE. --------------------------------------------------------------------------- \26\ 15 U.S.C. 78s(b)(3)(A)(ii). \27\ 17 CFR 240.19b-4(f)(2). --------------------------------------------------------------------------- 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 to determine whether the proposed rule should be approved or disapproved. 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 CommentsUse 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-ISE-2015-09 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-ISE-2015-09. 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 a.m. and 3 p.m. Copies of such filing also will be available for inspection and copying at the principal office of the ISE. 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-ISE-2015-09 and should be submitted by April 14, 2015. [[Page 15650]] For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\28\ --------------------------------------------------------------------------- \28\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Jill M. Peterson, Assistant Secretary. [FR Doc. 2015-06621 Filed 3-23-15; 8:45 am] BILLING CODE 8011-01-P
![15646 Federal Register / Vol. 80, No. 56 / Tuesday, March 24, 2015 / Notices
will ensure that such costs are covered C. Self-Regulatory Organization’s available for Web site viewing and
by each subscriber, with no subscriber Statement on Comments on the printing in the Commission’s Public
being assessed less than the cost of Proposed Rule Change Received From Reference Room on official business
providing the service. Members, Participants, or Others days between the hours of 10 a.m. and
Written comments were neither 3 p.m. Copies of such filing also will be
B. Self-Regulatory Organization’s available for inspection and copying at
Statement on Burden on Competition solicited nor received.
the principal offices of the Exchange.
III. Date of Effectiveness of the All comments received will be posted
NASDAQ does not believe that the Proposed Rule Change and Timing for without change; the Commission does
proposed rule changes will result in any Commission Action not edit personal identifying
burden on competition that is not information from submissions. You
The foregoing change has become
necessary or appropriate in furtherance should submit only information that
effective pursuant to Section
of the purposes of the Act, as amended.7 19(b)(3)(A)(ii) of the Act.8 At any time you wish to make available publicly. All
NASDAQ notes that it operates in a within 60 days of the filing of the submissions should refer to File
highly competitive market in which proposed rule change, the Commission Number SR–NASDAQ–2015–021, and
market participants can readily favor summarily may temporarily suspend should be submitted on or before April
competing venues if they deem fee such rule change if it appears to the 14, 2015.
levels at a particular venue to be Commission that such action is For the Commission, by the Division of
excessive, or rebate opportunities necessary or appropriate in the public Trading and Markets, pursuant to delegated
available at other venues to be more interest, for the protection of investors, authority.9
favorable. In such an environment, or otherwise in furtherance of the Jill M. Peterson,
NASDAQ must continually adjust its purposes of the Act. Assistant Secretary.
fees to remain competitive with other IV. Solicitation of Comments [FR Doc. 2015–06620 Filed 3–23–15; 8:45 am]
exchanges and with alternative trading BILLING CODE 8011–01–P
systems that have been exempted from Interested persons are invited to
compliance with the statutory standards submit written data, views, and
arguments concerning the foregoing, SECURITIES AND EXCHANGE
applicable to exchanges. Because
including whether the proposed rule COMMISSION
competitors are free to modify their own
change is consistent with the Act.
fees in response, and because market Comments may be submitted by any of [Release No. 34–74525; File No. SR–ISE–
participants may readily adjust their the following methods: 2015–09]
order routing practices, NASDAQ
believes that the degree to which fee Electronic Comments Self-Regulatory Organizations;
changes in general, and changes to fees • Use the Commission’s Internet International Securities Exchange,
for non-mandatory services particularly, comment form (http://www.sec.gov/ LLC; Notice of Filing and Immediate
in this market may impose any burden rules/sro.shtml); or Effectiveness of Proposed Rule
• Send an email to rule- Change To Amend the Schedule of
on competition is extremely limited. In
comments@sec.gov. Please include File Fees
this instance, the increases to the fees
assessed for subscription to NASDAQ’s Number SR–NASDAQ–2015–021 on the March 18, 2015.
Risk Management Service arise from a subject line. Pursuant to Section 19(b)(1) of the
need to cover the increase of costs in Paper Comments Securities Exchange Act of 1934 (the
offering the service since 2006, and the ‘‘Act’’),1 and Rule 19b–4 thereunder,2
• Send paper comments in triplicate notice is hereby given that on March 12,
loss of a significant number trades to Brent J. Fields, Secretary, Securities
covered by the service and a reduction 2015, the International Securities
and Exchange Commission, 100 F Street Exchange, LLC (the ‘‘Exchange’’ or the
in subscribers due to recent changes to NE., Washington, DC 20549–1090.
the ORF. Because of the reduced ‘‘ISE’’) filed with the Securities and
All submissions should refer to File Exchange Commission (the
number of trades and subscribers, the Number SR–NASDAQ–2015–021. This
costs of the service must be supported ‘‘Commission’’) the proposed rule
file number should be included on the change, as described in Items I, II, and
by those subscribers that remain. To the subject line if email is used.
extent that the fee increases are too III below, which items have been
To help the Commission process and prepared by the self-regulatory
high, subscribers may cancel their review your comments more efficiently, organization. The Commission is
subscriptions and develop their own please use only one method. The publishing this notice to solicit
risk management tools that replicate the Commission will post all comments on comments on the proposed rule change
Risk Management Service or use third the Commission’s Internet Web site from interested persons.
party risk management tools. As such, (http://www.sec.gov/rules/sro.shtml).
NASDAQ does not believe that any of Copies of the submission, all subsequent I. Self-Regulatory Organization’s
the proposed changes will impair the amendments, all written statements Statement of the Terms of Substance of
ability of members or competing order with respect to the proposed rule the Proposed Rule Change
execution venues to maintain their change that are filed with the The ISE proposes to amend the
competitive standing in the financial Commission, and all written Schedule of Fees as described in more
mstockstill on DSK4VPTVN1PROD with NOTICES
markets, and to the extent the fees are communications relating to the detail below. The text of the proposed
deemed too high, the changes may proposed rule change between the rule change is available on the
represent an opportunity for other Commission and any person, other than Exchange’s Web site (http://
market venues or third parties to those that may be withheld from the www.ise.com), at the principal office of
provide competitive services. public in accordance with the
provisions of 5 U.S.C. 552, will be 9 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
7 15 U.S.C. 78f(b)(8). 8 15 U.S.C. 78s(b)(3)(A)(ii). 2 17 CFR 240.19b–4.
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For the Commission, by the Division of A. Self-Regulatory Organization’s and resources dedicated to
Trading and Markets, pursuant to delegated Statement of the Purpose of, and development, quality assurance, and
authority.28 Statutory Basis for, the Proposed Rule support.
Jill M. Peterson, Change
Assistant Secretary. B. Self-Regulatory Organization’s
1. Purpose Statement on Burden on Competition
[FR Doc. 2015–06621 Filed 3–23–15; 8:45 am]
BILLING CODE 8011–01–P
The Exchange charges an Ethernet fee In accordance with Section 6(b)(8) of
for its four different Ethernet connection the Act,6 the Exchange does not believe
options, which is $1,000 per month for that the proposed rule change will
SECURITIES AND EXCHANGE a 1 Gigabit (‘‘Gb’’) connection, $4,500 impose any burden on intermarket or
COMMISSION per month for a 10 Gb connection, intramarket competition that is not
$8,000 per month for a 10 Gb low necessary or appropriate in furtherance
[Release No. 34–74529; File No. SR– latency connection, and $15,000 per of the purposes of the Act. The
ISEGemini–2015–07] month for a 40 Gb low latency proposed rule change amends the
connection. These Ethernet connectivity Schedule of Fees to apply low latency
Self-Regulatory Organizations; ISE options provide access to both ISE Ethernet fees to non-members in
Gemini, LLC; Notice of Filing and Gemini and ISE Gemini’s sister addition to members, and is not
Immediate Effectiveness of Proposed exchange, International Securities intended to have any competitive effect.
Rule Change To Amend the Schedule Exchange, LLC (‘‘ISE’’).3 While the 1 Gb The Exchange operates in a highly
of Fees and 10 Gb Ethernet fees apply to both competitive market in which market
members and non-members, the 10 Gb participants can readily direct their
March 18, 2015. low latency and 40 Gb low latency fees order flow to competing venues. In such
Pursuant to Section 19(b)(1) of the apply only to members. The Exchange an environment, the Exchange must
Securities Exchange Act of 1934 (the now proposes to amend the Schedule of continually review, and consider
‘‘Act’’),1 and Rule 19b–4 thereunder,2 Fees to apply the low latency Ethernet
adjusting, its fees to remain competitive
notice is hereby given that on March 13, fee to non-members as well. The
with other exchanges. For the reasons
2015 ISE Gemini, LLC (the ‘‘Exchange’’ Exchange designates this filing to
described above, the Exchange believes
or ‘‘ISE Gemini’’) filed with the become effective on March 16, 2015.
that the proposed fee changes reflect
Securities and Exchange Commission
2. Statutory Basis this competitive environment.
the proposed rule change, as described
in Items I, II, and III below, which items The Exchange believes that the C. Self-Regulatory Organization’s
have been prepared by the self- proposed rule change is consistent with Statement on Comments on the
regulatory organization. The the provisions of Section 6 of the Act,4 Proposed Rule Change Received From
Commission is publishing this notice to in general, and Section 6(b)(4) of the Members, Participants, or Others
solicit comments on the proposed rule Act,5 in particular, in that it is designed
change from interested persons. to provide for the equitable allocation of The Exchange has not solicited, and
reasonable dues, fees, and other charges does not intend to solicit, comments on
I. Self-Regulatory Organization’s among its members and other persons this proposed rule change. The
Statement of the Terms of the Substance using its facilities. The Exchange Exchange has not received any
of the Proposed Rule Change believes that it is reasonable, equitable, unsolicited written comments from
ISE Gemini proposes to amend the and not unfairly discriminatory to members or other interested parties.
Schedule of Fees to expand low latency extend the low latency Ethernet fees to III. Date of Effectiveness of the
Ethernet fees to non-members. The text non-members. Market participants that Proposed Rule Change and Timing for
of the proposed rule change is available establish connectivity to the Exchange Commission Action
on the Exchange’s Internet Web site at will continue to pay the same fee based
http://www.ise.com, at the principal on the Ethernet options that they The foregoing rule change has become
office of the Exchange, and at the choose, and there will be no effective pursuant to Section
Commission’s Public Reference Room. discrimination between the fees charged 19(b)(3)(A)(ii) of the Act,7 and
for members and non-members. While subparagraph (f)(2) of Rule 19b–4
II. Self-Regulatory Organization’s these low latency connections will thereunder,8 because it establishes a
Statement of the Purpose of, and likely continue to be of primary interest due, fee, or other charge imposed by ISE
Statutory Basis for, the Proposed Rule to Exchange members, the Exchange Gemini.
Change believes that these options should be At any time within 60 days of the
In its filing with the Commission, the available to interested non-members as filing of such proposed rule change, the
Exchange included statements well. Furthermore, the Exchange notes Commission summarily may
concerning the purpose of, and basis for, that the proposed rule change does not temporarily suspend such rule change if
the proposed rule change and discussed modify the fees applicable to these it appears to the Commission that such
any comments it received on the premium low latency Ethernet options, action is necessary or appropriate in the
proposed rule change. The text of these which will remain at their current public interest, for the protection of
statements may be examined at the levels. The low latency Ethernet fees investors, or otherwise in furtherance of
places specified in Item IV below. The described in this filing remain the purposes of the Act. If the
consistent with the Exchange’s
mstockstill on DSK4VPTVN1PROD with NOTICES
self-regulatory organization has Commission takes such action, the
prepared summaries, set forth in connectivity costs, including costs for Commission shall institute proceedings
Sections A, B and C below, of the most software and hardware enhancements, to determine whether the proposed rule
significant aspects of such statements. 3 Market participants pay the same fees regardless
should be approved or disapproved.
of whether they choose to connect to both
28 17 CFR 200.30–3(a)(12). exchanges or solely to ISE Gemini. 6 15 U.S.C. 78f(b)(8).
1 15 U.S.C. 78s(b)(1). 4 15 U.S.C. 78f. 7 15 U.S.C. 78s(b)(3)(A)(ii).
2 17 CFR 240.19b–4. 5 15 U.S.C. 78f(b)(4). 8 17 CFR 240.19b–4(f)(2).
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Document Created: 2015-12-18 11:45:09
Document Modified: 2015-12-18 11:45:09
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 80 FR 15646 |
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