80 FR 15834 - Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by Miami International Securities Exchange LLC To Amend Its Fee Schedule
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 57 (March 25, 2015)
Federal Register Volume 80, Issue 57 (March 25, 2015)
| Page Range | 15834-15838 | |
| FR Document | 2015-06716 |
[Federal Register Volume 80, Number 57 (Wednesday, March 25, 2015)] [Notices] [Pages 15834-15838] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-06716] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-74538; File No. SR-MIAX-2015-22] Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by Miami International Securities Exchange LLC To Amend Its Fee Schedule March 19, 2015. Pursuant to the provisions of Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on March 12, 2015, Miami International Securities Exchange LLC (``MIAX'' or ``Exchange'') filed with the Securities and Exchange Commission (``Commission'') a 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. --------------------------------------------------------------------------- \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 Exchange is filing a proposal to amend the MIAX Options Fee Schedule. The text of the proposed rule change is available on the Exchange's Web site at http://www.miaxoptions.com/filter/wotitle/rule_filing, at MIAX's principal office, 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 Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed [[Page 15835]] 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 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 Statutor Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend its Fee Schedule to make several changes to the Member and non-Member testing and certification fees. Specifically, the Exchange proposes to: (i) Change the Member and non- Member Application Programming Interface (``API'') Testing and Certification Fees from a one-time fee to a per API and per test fee; (ii) increase the API Testing and Certification Fees for non-Members by $200; (ii) [sic] change the Member Network Testing and Certification fee from a one-time per firm fee to a per connection and per test fee; (iii) [sic] change the non-Member Network Testing and Certification fee from a one-time per connection fee to a per connection and per test fee; (iv) [sic] increase the non-Member Network Testing and Certification Fee by $200; and (v) [sic] modify the name of the Network Testing and Certification Fee. API Testing and Certification Fees An API makes it possible for Member and non-Member software to communicate with Exchange software applications, and is subject to Member and non-Member testing with, and certification by, the Exchange. API testing and certification includes testing all available order types, new order entry, order management, order throughput and mass order cancellation, and also includes testing of all available quote types, quote throughput, quote management and cancellation, risk management settings and triggers, and confirmation of quotes within the Exchange's trading engines. The Exchange currently assesses a one-time API Testing and Certification Fee to Members and non-Members. Electronic Exchange Members (``EEMs'') \3\ are assessed a one-time API Testing and Certification Fee of $1,000. Market Makers \4\ are assessed a one-time API Testing and Certification Fee of $2,500. Non-Members are assessed a one-time API Testing and Certification Fee of $1,000. The fee represents the costs incurred by the Exchange as it works with each Member or non-Member while testing and certifying that the Member's software systems communicate properly with the Exchange. --------------------------------------------------------------------------- \3\ The term ``Electronic Exchange Member'' means the holder of a Trading Permit who is not a Market Maker. Electronic Exchange Members are deemed ``members'' under the Exchange Act. See Exchange Rule 100. \4\ The term ``Market Makers'' refers to ``Lead Market Makers'', ``Primary Lead Market Makers'' and ``Registered Market Makers'' collectively. See Exchange Rule 100. --------------------------------------------------------------------------- The Exchange proposes to modify the API Testing and Certification Fees from a one-time fee to a per API and per test fee in order to compensate for the additional costs associated with testing and certifying Members and non-Members multiple times for multiple connections. Member and Non-Member API Testing and Certification Fees will be assessed initially per API and each time API testing and certification is required due to a change to existing API either initiated by the Member/non-Member, or in response to a new or modified API offered but not mandated by the Exchange. API Testing and Certification Fees will not be assessed in situations where the Exchange requires API testing and certification due to a change mandated by the Exchange. The Exchange believes that it is reasonable not to charge Testing and Certification Fees in such situations because it involves an Exchange mandated testing and certification. The Member API Testing and Certification Fees will remain unchanged from the current $1,000 for EEMs and $2,500 for Market Makers. The Exchange proposes to increase the non-Member API Testing and Certification Fees from $1,000 to $1,200 for Third Party Vendors,\5\ Service Bureaus,\6\ and other non-Members. It has been MIAX's experience that Member testing takes less time than non-Member testing because Members have more experience testing these systems with the Exchange; generally fewer questions and issues arise during the testing and certification process. Also, because third party vendors and Service Bureaus are redistributing data and reselling services to other Members and market participants the number and types of scenarios that need to be tested are more numerous and complex than those tested and certified for a single Member. Therefore, the Exchange believes that it is reasonable to charge non-Members more for API testing and certification than Members. --------------------------------------------------------------------------- \5\ Third Party Vendors are subscribers of MIAX's market and other data feeds, which they in turn use for redistribution purposes. Third party vendors do not provide connectivity and therefore are not subject to Network testing and certification. See Fee Schedule note 20. \6\ A Service Bureau is a technology provider that offers and supplies technology and technology services to a trading firm that does not have its own proprietary system. The technology and technology services supplied by Service Bureaus include both software applications and connectivity, thus Service Bureaus are subject to both API testing and certification and network testing and certification. See Fee Schedule note 21. --------------------------------------------------------------------------- The Exchange notes that these changes will result in an increase to the API Testing and Certification Fees charged to Members and non- Members for those Members and non-Members that need testing and certification beyond the initial one. For example, Market Maker (``MM1'') conducts API testing and certification initially upon connection to the Exchange, and then two more times during the year each time it upgrades its software. Currently, MM1 would be assessed $2,500 in API Testing and Certification Fees for the three testing and certifications that were conducted by Exchange staff. As proposed, MM1 would be assessed $7,500 in API Testing and Certification Fees for the three testing and certifications that were conducted by Exchange staff. Example 2, a Third Party Vendor (``V1'') conducts API testing and certification initially upon connection to the Exchange for (2) API, and then two more times during the year each time it upgrades its software. Currently, V1 would be assessed $2,000 in API Testing and Certification Fees for the four testing and certifications that were conducted by Exchange staff. As proposed, V1 would be assessed $4,800 in API Testing and Certification Fees for the four testing and certifications that were conducted by Exchange staff. The proposed fee changes more closely represent the costs incurred by the Exchange as it works with each Member or non-Member while testing and certifying that the Member's or non-Member's software systems communicate properly with the Exchange. Network Testing and Certification Fees Network Testing and Certification Fees are charged to recoup installation and support costs incurred by the Exchange as it works with each Member and non-Member to make sure there are appropriate electronic connections with the Exchange's system. The Exchange currently assesses Members a one-time Network Testing and Certification Fee of $1,000 per Member firm for a one gigabit connection, and $4,000 per Member firm for a ten gigabit connection. Members are currently not charged a Network Testing and Certification Fee for any additional connections and tests. The Exchange currently assesses non-Members a one- [[Page 15836]] time Network Testing and Certification Fee of $1,000 per Non-Member for a one gigabit connection, and $4,000 per Non-Member for a ten gigabit connection. In contrast to Members, non-Members are charged a Network Testing and Certification Fee for each additional connection, but not additional tests. The Exchange proposes to modify the Member Network Testing and Certification Fee from a one-time fee per firm to a per connection and per test fee in order to compensate for the additional costs associated with testing and certifying Members multiple times. The Exchange also proposes to modify the non-Member Network Testing and Certification Fee from a one-time fee per connection to a per connection and per test fee. Member and non-Member Network Testing and Certification Fees will be assessed initially per connection, and each time testing and certification is required due to a change to existing network connectivity, either initiated by the Member/non-Member or in response to new or modified network connectivity offered but not mandated by the Exchange.\7\ Network Connectivity Testing and Certification Fees will not be assessed in situations where the Exchange requires network connectivity testing and certification due to a change or changes mandated by the Exchange. As stated above, the Exchange believes that it is reasonable not to charge Testing and Certification Fees in such situations because it involves an Exchange mandated testing and certification. --------------------------------------------------------------------------- \7\ For example, the Exchange could determine to make available a higher Gigabit connection, not currently offered by the Exchange, such as a 15 Gigabit connection. A Member or non-Member with a relatively high level of interaction with the Exchange's system may wish to establish such a connection, whereas a Member or non-Member with a relatively lower level of interaction with the Exchange's system may not have a need for such connectivity and would therefore elect not to engage in such a connection. --------------------------------------------------------------------------- Member Network Testing and Certification Fees will remain unchanged from the current $1,000 per 1 gigabit connection and $4,000 per 10 gigabit connection. The Exchange proposes to increase the non-Member Network Testing and Certification Fees from $1,000 to $1,200 per 1 gigabit connection, and from $4,000 to $4,200 per 10 gigabit connection. It has been MIAX's experience that Member testing takes less time than non-Member testing because Members have more experience testing these systems with the Exchange; generally fewer questions and issues arise during the testing and certification process. Also, because third party vendors and Service Bureaus are redistributing data and reselling services to other Members and market participants the number and types of scenarios that need to be tested are more numerous and complex than those tested and certified for a single Member. Therefore, the Exchange believes that it is reasonable to charge non-Members more for network testing and certification than Members. The Exchange notes that these changes will result in an increase to the Network Testing and Certification Fees charged to Members and non- Members for those Members and non-Members that need testing and certification beyond the initial one. For example, MM1 conducts network testing and certification for a one gigabit connection initially upon connection to the Exchange, and then two more times during the year each time it upgrades its hardware. Currently, MM1 would be assessed $1,000 in Network Testing and Certification Fees for the three testing and certifications that were conducted by Exchange staff. As proposed, MM1 would be assessed $3,000 in Network Testing and Certification Fees for the three testing and certifications that were conducted by Exchange staff. Example 2, MM2 conducts networking and testing for (3) one gigabit connections, and then two more times during the year each time it upgrades its hardware. Currently, MM2 would be assessed $1,000 in Network Testing and Certification Fees for the five testing and certifications that were conducted by Exchange staff. As proposed, MM1 would be assessed $5,000 in Network Testing and Certification Fees for the five testing and certifications that were conducted by Exchange staff. Example 3, V1 conducts networking and testing for (3) one gigabit connections, and then two more times during the year each time it upgrades its software. Currently, V1 would be assessed $3,000 in Network Testing and Certification Fees for the five testing and certifications that were conducted by Exchange staff. As proposed, V1 would be assessed $6,000 in Network Testing and Certification Fees for the five testing and certifications that were conducted by Exchange staff. The proposed fee changes more closely represent the costs incurred by the Exchange as it works with each Member or non-Member while testing and certifying that the Member's or non-Member's connections are appropriate for the Exchange's system. Finally, the Exchange proposes to modify the name of Network Testing and Certification Fee to Network Connectivity Testing and Certification Fee, and the title of the column in the chart from ``Member Network Connectivity Testing and Certification'' to ``Type of Member''. The Exchange believes that the new title more clearly describes the type of service that is being provided in exchange for the fee. 2. Statutory Basis The Exchange believes that its proposed rule change is consistent with Section 6(b) of the Act \8\ in general, and furthers the objectives of Section 6(b)(4) of the Act \9\ in particular, in that it is an equitable allocation of reasonable fees and other charges among Exchange members. --------------------------------------------------------------------------- \8\ 15 U.S.C. 78f(b). \9\ 15 U.S.C. 78f(b)(4). --------------------------------------------------------------------------- The Exchange believes that the proposed changes of Member and non- Member API Testing and Certification Fees are reasonable, equitable and not unfairly discriminatory. The Exchange believes that the proposed fees are a reasonable allocation of its costs and expenses among its Members and other persons using its facilities since it is recovering the costs associated with providing such infrastructure testing and certification services, and with offering access through the network connections and access and services through API, responding to customer requests, configuring MIAX systems, programming API user specifications and administering the various services connectivity services. Access to the Exchange is provided on fair and non-discriminatory terms. The Exchange believes the proposed fees are equitable and not unfairly discriminatory because the new fee levels result in a more reasonable and equitable allocation of fees amongst non-Members and Members for similar services. The Exchange believes that the proposed changes of Member Network Testing and Certification Fees are reasonable, equitable and not unfairly discriminatory. The Exchange believes that the proposed fees are a reasonable allocation of its costs and expenses among its Members and other persons using its facilities since it is recovering the costs associated with providing such infrastructure testing and certification services, and with offering access through the network connections and access and services through Ports, responding to customer requests, configuring MIAX systems, programming user specifications and administering the various connectivity services. Access to the Exchange is provided on fair and non-discriminatory terms. The Exchange believes the proposed fees are equitable and not unfairly discriminatory because the new [[Page 15837]] fee levels result in a more reasonable and equitable allocation of fees amongst non-Members and Members for similar services. The Exchange believes that Testing and Certification Fees and Network Connectivity Testing and Certification Fees should only be assessed when a Member or non-Member initiates a change to its system that requires testing and certification. The Exchange believes that it is reasonable not to charge Testing and Certification Fees and Network Connectivity Testing and Certification Fees in situations where the Exchange initiates a change to its own system that requires testing and certification. The proposed changes to the Fee Schedule are intended, among other things, to eliminate the potential burden of unexpected costs to users of the Exchange's system when testing and certification is required due to an Exchange-initiated system change. The Exchange believes that the proposed fees are an equitable allocation of its costs and expenses among its Members and other persons using its facilities. The higher fee charged to non-Members reflects the greater amount of technological, financial and human resources devoted to testing and certification of non-Members. It has been the Exchange's experience that Members have more experience testing these systems with the Exchange; generally fewer questions and issues arise during the testing and certification process. In addition, non-Members will be charged a higher Network Testing and Certification Fee because each connection will be used by different customers of a non-Member such as a Service Bureau or Extranet Provider, and each such customer must be individually tested and certified. The complexity, number and various types of scenarios involved in non-Member testing and certification require the Exchange to expend more resources in testing and certifying non-Member API and network connectivity requirements than those tested and certified for a single Member. Therefore, the higher fee applicable to non-Members is not unfairly discriminatory and is an equitable allocation of reasonable fees and other charges among Exchange Members and others using its facilities. Finally, the Exchange believes that the proposed change to modify the name of the Network Testing and Certification Fee to Network Connectivity Testing and Certification Fee is reasonable in that the new title more clearly describes the type of service that is provided by the Exchange. 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 not necessary or appropriate in furtherance of the purposes of the Act. The proposal is reasonably designed to increase the fee charged for testing and certification in a manner to recoup the costs associated with multiple tests and certifications by both Members and non-Members. The Exchange believes that the proposal should reduce the disparity of testing and certification fees between Members and non-Members in a manner that promotes competition amongst these participants for these types of services. The higher fees charged to non-Members for testing and certification reflects the greater amount of technological, financial and human resources devoted to testing and certification of non- Members. It has been the Exchange's experience that Members have more experience testing these systems with the Exchange; generally fewer questions and issues arise during the testing and certification process. In addition, non-Members will be charged a higher Network Testing and Certification Fee because each connection will be used by different customers of a non-Member such as a Service Bureau or Extranet Provider, and each such customer must be individually tested and certified. The Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues if they deem fee levels at a particular venue to be excessive. In such an environment, the Exchange must continually adjust its fees to remain competitive with other exchanges and to attract order flow. 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 The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.\10\ 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. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. --------------------------------------------------------------------------- \10\ 15 U.S.C. 78s(b)(3)(A)(ii). --------------------------------------------------------------------------- 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-MIAX-2015-22 on the subject line. Paper Comments Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-MIAX-2015-22. 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 also will be available for inspection and copying at the principal office of the Exchange. 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-MIAX-2015-22 and should be submitted on or before April 15, 2015. [[Page 15838]] For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\11\ --------------------------------------------------------------------------- \11\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Brent J. Fields, Secretary. [FR Doc. 2015-06716 Filed 3-24-15; 8:45 am] BILLING CODE 8011-01-P
![15834 Federal Register / Vol. 80, No. 57 / Wednesday, March 25, 2015 / Notices
of investors; or (iii) otherwise in For the Commission, by the Division of designates May 5, 2015, as the date by
furtherance of the purposes of the Act. Trading and Markets, pursuant to delegated which the Commission shall either
If the Commission takes such action, the authority.17 approve or disapprove or institute
Commission shall institute proceedings Brent J. Fields, proceedings to determine whether to
to determine whether the proposed rule Secretary. disapprove the proposed rule change
should be approved or disapproved. [FR Doc. 2015–06711 Filed 3–24–15; 8:45 am] (File Number SR–NYSEArca-2015–01).
BILLING CODE 8011–01–P For the Commission, by the Division
IV. Solicitation of Comments of Trading and Markets, pursuant to
Interested persons are invited to delegated authority.6
submit written data, views, and SECURITIES AND EXCHANGE
Brent J. Fields,
arguments concerning the foregoing, COMMISSION
Secretary.
including whether the proposed rule [Release No. 34–74534; File No. SR– [FR Doc. 2015–06712 Filed 3–24–15; 8:45 am]
change is consistent with the Act. NYSEArca–2015–01]
BILLING CODE 8011–01–P
Comments may be submitted by any of
the following methods: Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Designation of a
Electronic Comments SECURITIES AND EXCHANGE
Longer Period for Commission Action
• Use the Commission’s Internet COMMISSION
on Proposed Rule Change Amending
comment form (http://www.sec.gov/ NYSE Arca Equities Rule 5.2(j)(3), [Release No. 34–74538; File No. SR–MIAX–
rules/sro.shtml); or Commentary .02 Relating to Listing of 2015–22]
• Send an email to rule-comments@ Investment Company Units Based on
sec.gov. Please include File Number SR– Municipal Bond Indexes Self-Regulatory Organizations; Miami
Phlx–2015–023 on the subject line. International Securities Exchange LLC;
March 19, 2015. Notice of Filing and Immediate
Paper Comments On January 16, 2015, NYSE Arca, Inc. Effectiveness of a Proposed Rule
• Send paper comments in triplicate filed with the Securities and Exchange Change by Miami International
to Brent J. Fields, Secretary, Securities Commission (‘‘Commission’’), pursuant Securities Exchange LLC To Amend Its
and Exchange Commission, 100 F Street to Section 19(b)(1) of the Securities Fee Schedule
NE., Washington, DC 20549–1090. Exchange Act of 1934 (‘‘Act’’) 1 and Rule
19b–4 thereunder,2 a proposed rule March 19, 2015.
All submissions should refer to File change to amend NYSE Arca Equities Pursuant to the provisions of Section
Number SR–Phlx–2015–023. This file Rule 5.2(j)(3), Commentary .02 relating 19(b)(1) of the Securities Exchange Act
number should be included on the to the listing of Investment Company of 1934 (‘‘Act’’) 1 and Rule 19b–4
subject line if email is used. To help the Units based on fixed income securities thereunder,2 notice is hereby given that
Commission process and review your indexes. The proposed rule change was on March 12, 2015, Miami International
comments more efficiently, please use published for comment in the Federal Securities Exchange LLC (‘‘MIAX’’ or
only one method. The Commission will Register on February 4, 2015.3 The ‘‘Exchange’’) filed with the Securities
post all comments on the Commission’s Commission has received no comment and Exchange Commission
Internet Web site (http://www.sec.gov/ letters on the proposed rule change. (‘‘Commission’’) a proposed rule change
rules/sro.shtml). Copies of the Section 19(b)(2) of the Act 4 provides as described in Items I, II, and III below,
submission, all subsequent that, within 45 days of the publication which Items have been prepared by the
amendments, all written statements of notice of the filing of a proposed rule Exchange. The Commission is
with respect to the proposed rule change, or within such longer period up publishing this notice to solicit
change that are filed with the to 90 days as the Commission may comments on the proposed rule change
Commission, and all written designate if it finds such longer period from interested persons.
communications relating to the to be appropriate and publishes its I. Self-Regulatory Organization’s
proposed rule change between the reasons for so finding or as to which the Statement of the Terms of Substance of
Commission and any person, other than self-regulatory organization consents, the Proposed Rule Change
those that may be withheld from the the Commission shall either approve the
public in accordance with the proposed rule change, disapprove the The Exchange is filing a proposal to
provisions of 5 U.S.C. 552, will be proposed rule change, or institute amend the MIAX Options Fee Schedule.
available for Web site viewing and proceedings to determine whether the The text of the proposed rule change
printing in the Commission’s Public proposed rule change should be is available on the Exchange’s Web site
Reference Room, 100 F Street NE., disapproved. The Commission is at http://www.miaxoptions.com/filter/
Washington, DC 20549–1090, on official extending this 45-day time period. The wotitle/rule_filing, at MIAX’s principal
business days between the hours of Commission finds that it is appropriate office, and at the Commission’s Public
10:00 a.m. and 3:00 p.m. Copies of such to designate a longer period within Reference Room.
filing also will be available for which to take action on the proposed II. Self-Regulatory Organization’s
inspection and copying at the principal rule change so that it has sufficient time Statement of the Purpose of, and
offices of the Exchange. All comments to consider the proposed rule change. Statutory Basis for, the Proposed Rule
received will be posted without change; Accordingly, the Commission, Change
the Commission does not edit personal pursuant to Section 19(b)(2) of the Act,5
rljohnson on DSK3VPTVN1PROD with NOTICES
In its filing with the Commission, the
identifying information from
Exchange included statements
submissions. You should submit only 17 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1). concerning the purpose of and basis for
information that you wish to make
2 17 CFR 240.19b–4. the proposed rule change and discussed
available publicly. All submissions 3 See Securities Exchange Act Release No. 74175
should refer to File Number SR–Phlx– (Jan. 29, 2015), 80 FR 6150. 6 17 CFR 200.30–3(a)(31).
2015–023, and should be submitted on 4 15 U.S.C. 78s(b)(2). 1 15 U.S.C. 78s(b)(1).
or before April 15, 2015. 5 Id. 2 17 CFR 240.19b–4.
VerDate Sep<11>2014 15:26 Mar 24, 2015 Jkt 235001 PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 E:\FR\FM\25MRN1.SGM 25MRN1](https://thefederalregister.org/doc/80_FR_15891/page/1.svg)
![Federal Register / Vol. 80, No. 57 / Wednesday, March 25, 2015 / Notices 15835
any comments it received on the API Testing and Certification Fee of and market participants the number and
proposed rule change. The text of these $2,500. Non-Members are assessed a types of scenarios that need to be tested
statements may be examined at the one-time API Testing and Certification are more numerous and complex than
places specified in Item IV below. The Fee of $1,000. The fee represents the those tested and certified for a single
Exchange has prepared summaries, set costs incurred by the Exchange as it Member. Therefore, the Exchange
forth in sections A, B, and C below, of works with each Member or non- believes that it is reasonable to charge
the most significant aspects of such Member while testing and certifying non-Members more for API testing and
statements. that the Member’s software systems certification than Members.
communicate properly with the The Exchange notes that these
A. Self-Regulatory Organization’s changes will result in an increase to the
Exchange.
Statement of the Purpose of, and The Exchange proposes to modify the API Testing and Certification Fees
Statutor Basis for, the Proposed Rule API Testing and Certification Fees from charged to Members and non-Members
Change a one-time fee to a per API and per test for those Members and non-Members
1. Purpose fee in order to compensate for the that need testing and certification
The Exchange proposes to amend its additional costs associated with testing beyond the initial one. For example,
Fee Schedule to make several changes to and certifying Members and non- Market Maker (‘‘MM1’’) conducts API
the Member and non-Member testing Members multiple times for multiple testing and certification initially upon
and certification fees. Specifically, the connections. Member and Non-Member connection to the Exchange, and then
Exchange proposes to: (i) Change the API Testing and Certification Fees will two more times during the year each
Member and non-Member Application be assessed initially per API and each time it upgrades its software. Currently,
Programming Interface (‘‘API’’) Testing time API testing and certification is MM1 would be assessed $2,500 in API
and Certification Fees from a one-time required due to a change to existing API Testing and Certification Fees for the
fee to a per API and per test fee; (ii) either initiated by the Member/non- three testing and certifications that were
increase the API Testing and Member, or in response to a new or conducted by Exchange staff. As
Certification Fees for non-Members by modified API offered but not mandated proposed, MM1 would be assessed
$200; (ii) [sic] change the Member by the Exchange. API Testing and $7,500 in API Testing and Certification
Network Testing and Certification fee Certification Fees will not be assessed in Fees for the three testing and
from a one-time per firm fee to a per situations where the Exchange requires certifications that were conducted by
connection and per test fee; (iii) [sic] API testing and certification due to a Exchange staff. Example 2, a Third Party
change the non-Member Network change mandated by the Exchange. The Vendor (‘‘V1’’) conducts API testing and
Testing and Certification fee from a one- Exchange believes that it is reasonable certification initially upon connection
time per connection fee to a per not to charge Testing and Certification to the Exchange for (2) API, and then
connection and per test fee; (iv) [sic] Fees in such situations because it two more times during the year each
increase the non-Member Network involves an Exchange mandated testing time it upgrades its software. Currently,
Testing and Certification Fee by $200; and certification. V1 would be assessed $2,000 in API
The Member API Testing and Testing and Certification Fees for the
and (v) [sic] modify the name of the
Certification Fees will remain four testing and certifications that were
Network Testing and Certification Fee.
unchanged from the current $1,000 for conducted by Exchange staff. As
API Testing and Certification Fees EEMs and $2,500 for Market Makers. proposed, V1 would be assessed $4,800
An API makes it possible for Member The Exchange proposes to increase in API Testing and Certification Fees for
and non-Member software to the non-Member API Testing and the four testing and certifications that
communicate with Exchange software Certification Fees from $1,000 to $1,200 were conducted by Exchange staff. The
applications, and is subject to Member for Third Party Vendors,5 Service proposed fee changes more closely
and non-Member testing with, and Bureaus,6 and other non-Members. It represent the costs incurred by the
certification by, the Exchange. API has been MIAX’s experience that Exchange as it works with each Member
testing and certification includes testing Member testing takes less time than or non-Member while testing and
all available order types, new order non-Member testing because Members certifying that the Member’s or non-
entry, order management, order have more experience testing these Member’s software systems
throughput and mass order cancellation, systems with the Exchange; generally communicate properly with the
and also includes testing of all available fewer questions and issues arise during Exchange.
quote types, quote throughput, quote the testing and certification process.
Also, because third party vendors and Network Testing and Certification Fees
management and cancellation, risk
management settings and triggers, and Service Bureaus are redistributing data Network Testing and Certification
confirmation of quotes within the and reselling services to other Members Fees are charged to recoup installation
Exchange’s trading engines. and support costs incurred by the
The Exchange currently assesses a and ‘‘Registered Market Makers’’ collectively. See Exchange as it works with each Member
Exchange Rule 100. and non-Member to make sure there are
one-time API Testing and Certification 5 Third Party Vendors are subscribers of MIAX’s
Fee to Members and non-Members. appropriate electronic connections with
market and other data feeds, which they in turn use
Electronic Exchange Members for redistribution purposes. Third party vendors do the Exchange’s system. The Exchange
(‘‘EEMs’’) 3 are assessed a one-time API not provide connectivity and therefore are not currently assesses Members a one-time
Testing and Certification Fee of $1,000. subject to Network testing and certification. See Fee Network Testing and Certification Fee of
Schedule note 20. $1,000 per Member firm for a one
rljohnson on DSK3VPTVN1PROD with NOTICES
Market Makers 4 are assessed a one-time 6 A Service Bureau is a technology provider that
offers and supplies technology and technology
gigabit connection, and $4,000 per
3 The term ‘‘Electronic Exchange Member’’ means services to a trading firm that does not have its own Member firm for a ten gigabit
the holder of a Trading Permit who is not a Market proprietary system. The technology and technology connection. Members are currently not
Maker. Electronic Exchange Members are deemed services supplied by Service Bureaus include both charged a Network Testing and
‘‘members’’ under the Exchange Act. See Exchange software applications and connectivity, thus
Rule 100. Service Bureaus are subject to both API testing and
Certification Fee for any additional
4 The term ‘‘Market Makers’’ refers to ‘‘Lead certification and network testing and certification. connections and tests. The Exchange
Market Makers’’, ‘‘Primary Lead Market Makers’’ See Fee Schedule note 21. currently assesses non-Members a one-
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![15838 Federal Register / Vol. 80, No. 57 / Wednesday, March 25, 2015 / Notices
For the Commission, by the Division of and discussed any comments it received For each of these option classes, the
Trading and Markets, pursuant to delegated on the proposed rule change. The text Exchange may list five short term option
authority.11 of those statements may be examined at expiration dates at any given time, not
Brent J. Fields, the places specified in Item IV below. counting monthly or quarterly
Secretary. The Exchange has prepared summaries, expirations.6 Specifically, on any
[FR Doc. 2015–06716 Filed 3–24–15; 8:45 am] set forth in sections A, B, and C below, Thursday or Friday that is a business
BILLING CODE 8011–01–P of the most significant parts of such day, the Exchange currently may list
statements. short term options that expire at the
close of business on each of the next
A. Self-Regulatory Organization’s five Fridays that are business days and
SECURITIES AND EXCHANGE
Statement of the Purpose of, and are not Fridays in which monthly or
COMMISSION
Statutory Basis for, the Proposed Rule quarterly options expire.7 These short
[Release No. 34–74541; File No. SR– Change
NYSEARCA–2015–16] term option series may be listed in
1. Purpose strike price intervals of $0.50, $1, or
Self-Regulatory Organizations; NYSE The Exchange proposes to amend its $2.50, with the finer strike price
Arca, Inc.; Notice of Filing and rules governing the Short Term Option intervals being offered for lower priced
Immediate Effectiveness of Proposed Series program (‘‘STOS Program’’) to securities,8 and for options that trade in
Rule Change Amending Its Rules introduce finer strike price intervals for dollar increments in the related monthly
Governing the Short Term Option certain short term options. In particular, expiration.9 More specifically, per
Series Program To Extend Current the Exchange proposes to amend current Commentary .07(e) to Rule 6.4,
$0.50 Strike Price Intervals in Non- Commentary .07(e) to Rule 6.4 to extend the strike price interval for STOS may
Index Options to Short Term Options current $0.50 strike price intervals in be $0.50 or greater for option classes
With Strike Prices Less Than $100 non-index options to short term options that both trade in $1 strike price
with strike prices less than $100 instead intervals and are in the STOS Program.
March 19, 2015. If the class does not trade in $1 strike
of the current $75. This proposed
Pursuant to Section 19(b)(1) 1 of the price intervals, the Exchange may list
change is intended to eliminate gapped
Securities Exchange Act of 1934 (the STOS in $0.50 intervals for strike prices
strikes between $75 and $100 that result
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 less than $75; in $1 intervals for strike
from conflicting strike price parameters
notice is hereby given that, on March prices that are between $75 and $150;
under the STOS and $2.50 Strike Price
12, 2015, NYSE Arca, Inc. (the and in $2.50 intervals for strike prices
Programs as described in more detail
‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with greater than $150.10.10
below. The Exchange believes that the
the Securities and Exchange The Exchange also operates a $2.50
proposed rule change would increase
Commission (the ‘‘Commission’’) the Strike Price Program that permits the
market efficiency as it would align the
proposed rule change as described in Exchange to select up to sixty options
Exchange’s rules with recently approved
Items I and II below, which Items have classes on individual stocks to trade in
changes to the rules governing short
been prepared by the self-regulatory $2.50 strike price intervals, in addition
term options series programs of other
organization. The Commission is to option classes selected by other
options exchanges,4 which would
publishing this notice to solicit securities exchanges that employ a
enable the Exchange to compete equally
comments on the proposed rule change similar program under their respective
and fairly with other options exchanges
from interested persons. rules.11 Monthly expiration options in
in satisfying strong customer demand to
classes admitted to the $2.50 Strike
I. Self-Regulatory Organization’s have the ability to execute hedging and
Price Program trade in $2.50 intervals
Statement of the Terms of Substance of trading strategies in finer strike price
where the strike price is (1) greater than
the Proposed Rule Change intervals.
Pursuant to Commentary .07(b) to $25 but less than $50; or (2) between
The Exchange proposes to amend its $50 and $100 if the strikes are no more
rules governing the Short Term Option Rule 6.4, the Exchange may list short
term options in up to fifty option than $10 from the closing price of the
Series program to extend current $0.50 underlying stock in its primary market
strike price intervals in non-index classes, in addition to option classes
that are selected by other securities on the preceding day.12 In certain
options to Short Term Options with instances, these strike price parameters
strike prices less than $100. The text of exchanges that employ a similar
program under their respective rules.5 conflict with strike prices allowed for
the proposed rule change is available on short term options as dollar strikes
the Exchange’s Web site at 4 See Securities and Exchange Act Release No. between $75 and $100 otherwise
www.nyse.com, at the principal office of 73999 (January 6, 2015), 80 FR 1599 [sic] (January allowed under the STOS Program may
the Exchange, and at the Commission’s 12, 2015) (SR–ISE–2014–52) (order granting
Public Reference Room. approval of proposed rule change regarding short options and is not apportioned between equity
term option series program). Following approval of options and index options. For STOS Program rules
II. Self-Regulatory Organization’s filing by the International Securities Exchange, LLC, regarding index options, see Rule 5.19; Rule
Statement of the Purpose of, and several other option exchanges submitted ‘‘copycat’’ 5.10(b)(24).
filings for immediate effectiveness. See, e.g., 6 See Commentary .07(a) to Rule 6.4.
Statutory Basis for, the Proposed Rule Securities and Exchange Act Release Nos. 74016 7 Id.
Change (January 8, 2015), 80 FR 1976 (January 14, 2015) 8 See Commentary .07(e) to Rule 6.4.
(SR–BOX–2015–01); 74144 (January 27, 2015), 80
In its filing with the Commission, the FR 5602 (February 2, 2015) (SR–CBOE–2015–09
9 See Commentary .04 to Rule 6.4 (allows the
rljohnson on DSK3VPTVN1PROD with NOTICES
self-regulatory organization included [sic]); 74145 (January 27, 2015), 80 FR 5600 Exchange to designate up to 150 options classes on
statements concerning the purpose of, (February 2, 2015) (SR–Phlx–2015–09); 74146 individual stocks to be traded in $1 strike price
(January 27, 2015), 80 FR 5595 (February 2, 2015) intervals where the strike price is between $50 and
and basis for, the proposed rule change $1).
(SR–NASDAQ–2015–005); 74147 (January 27,
10 See Commentary .07(e) to Rule 6.4.
2015), 80 FR 5604 (February 2, 2015) (SR–BX–
11 17 CFR 200.30–3(a)(12). 11 See Commentary .03 to Rule 6.4.
2015–006).
1 15 U.S.C.78s(b)(1). 5 The Exchange notes that the number of option 12 Id. The term ‘‘primary market’’ is defined in
2 15 U.S.C. 78a.
classes that may participate in the STOS Program Rule 6.1(7) [sic] as the principal market in which
3 17 CFR 240.19b–4. is aggregated between equity options and index an underlying security is traded.
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Document Created: 2018-02-21 09:48:55
Document Modified: 2018-02-21 09:48:55
| 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 15834 |
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