80 FR 17791 - Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees for the BATS One Market Data Product
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 63 (April 2, 2015)
Federal Register Volume 80, Issue 63 (April 2, 2015)
| Page Range | 17791-17795 | |
| FR Document | 2015-07519 |
[Federal Register Volume 80, Number 63 (Thursday, April 2, 2015)] [Notices] [Pages 17791-17795] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-07519] ======================================================================= ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-74598; File No. SR-BATS-2015-24] Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees for the BATS One Market Data Product March 27, 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 17, 2015, BATS Exchange, Inc. (the ``Exchange'' or ``BZX'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I, II and III below, which Items have been prepared by the Exchange. The Exchange has designated the proposed rule change as one establishing or changing a member due, fee, or other charge imposed by the Exchange under Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\ which renders the proposed rule change effective upon filing with the Commission. 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. \3\ 15 U.S.C. 78s(b)(3)(A)(ii). \4\ 7 CFR 240.19b-4(f)(2). --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange filed a proposal to amend the market data section of its fee schedule to: (i) Establish a Digital Media Enterprise Fee for the BATS One Feed; and (ii) make a non-substantive change to the description of the BATS One Feed Enterprise fee. The text of the proposed rule change is available at the Exchange's Web site at www.batstrading.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 Exchange 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 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 market data section of its fee schedule to: (i) Establish a Digital Media Enterprise Fee for the BATS One Feed; and (ii) make a non-substantive change to the description of the BATS One Feed Enterprise fee.\5\ --------------------------------------------------------------------------- \5\ The Exchange notes that the date of the fee schedule was amended to March 17, 2015 in a previously filed proposed rule change. See SR-BATS-2015-23 (filed March 17, 2015). --------------------------------------------------------------------------- The Commission recently approved a proposed rule change by the Exchange to establish a new market data product called the BATS One Feed \6\ as well as published proposed rule changes to establish related fees.\7\ The BATS One Feed is a data feed that disseminates, on a real-time basis, the aggregate best bid and offer (``BBO'') of all displayed orders for securities traded on BZX and its affiliated exchanges \8\ and for which the BATS Exchanges report quotes under the Consolidated Tape Association (``CTA'') Plan or the Nasdaq/UTP Plan.\9\ The BATS One Feed also contains the individual last sale information for the BATS Exchanges (collectively with the aggregate BBO, the ``BATS One Summary Feed''). In addition, the BATS One Feed contains optional functionality which enables recipients to receive aggregated two-sided quotations from the BATS Exchanges for up to five (5) price levels (``BATS One Premium Feed''). --------------------------------------------------------------------------- \6\ See Securities Exchange Act Release No. 73918 (December 23, 2014), 79 FR 78920 (December 31, 2014) (File Nos. SR-EDGX-2014-25; SR-EDGA-2014-25; SR-BATS-2014-055; SR-BYX-2014-030) (Notice of Amendments No. 2 and Order Granting Accelerated Approval to Proposed Rule Changes, as Modified by Amendments Nos. 1 and 2, to Establish a New Market Data Product called the BATS One Feed) (``BATS One Approval Order''). \7\ See Securities Exchange Act Release Nos. 74282 (February 17, 2015), 80 FR 9487 (February 23, 2015) (SR-EDGX-2015-09); 74283 (February 18, 2015), 80 FR 9809 (February 24, 2015) (SR-EDGA-2015- 09); 74284 (February 18, 2015), 80 FR 9792 (February 24, 2015) (SR- BYX-2015-09); and 74285 (February 18, 2015), 80 FR 9828 (February 24, 2015) (SR-BATS-2015-11) (``BATS One Fee Proposals''). \8\ BZX's affiliated exchanges are EDGA Exchange, Inc. (``EDGA''), EDGX Exchange, Inc. (``EDGX''), and BATS Y-Exchange, Inc. (``BYX'', together with EDGX, EDGA, and BZX, the ``BATS Exchanges''). On January 23, 2014, BATS Global Markets, Inc. (``BGMI''), the former parent company of the Exchange and BYX, completed its business combination with Direct Edge Holdings LLC, the parent company of EDGA and EDGX. See Securities Exchange Act Release No. 71375 (January 23, 2014), 79 FR 4771 (January 29, 2014) (SR-BATS-2013-059; SR-BYX-2013-039). Upon completion of the business combination, DE Holdings and BGMI each became intermediate holding companies, held under a single new holding company. The new holding company, formerly named ``BATS Global Markets Holdings, Inc.,'' changed its name to ``BATS Global Markets, Inc.'' and BGMI changed its name to ``BATS Global Markets Holdings, Inc.'' \9\ The Exchange understands that each of the BATS Exchanges will separately file substantially similar proposed rule changes with the Commission to implement fees for the BATS One Feed. --------------------------------------------------------------------------- BATS One Digital Media Enterprise Fee The Exchange proposes to amend its fee schedule to establish a Digital Media Enterprise Fee of $15,000 per month for [[Page 17792]] the BATS One Summary Feed and $25,000 per month for the BATS One Premium Feed. As an alternative to User fees,\10\ a recipient firm may purchase a monthly Digital Media Enterprise license to receive the BATS One Feed from an External Distributor \11\ to distribute to an unlimited number of Professional and Non-Professional Users \12\ for viewing via television, Web sites, and mobile devices for informational and non-trading purposes only without having to account for the extent of access to the data or the report the number of Users to the Exchange. The Digital Media Enterprise Fee would be in addition to the Data Consolidation Fee.\13\ --------------------------------------------------------------------------- \10\ The Exchange assesses a monthly fee for Professional Users of $10.00 per User for receipt of the BATS One Summary Feed or $15.00 per User who elects to also receive the BATS One Premium Feed. Non-Professional Users are assessed a monthly fee of $0.25 per user for the BATS One Summary Feed or $0.50 per user for the BATS One Premium Feed. External Distributors must count every Professional User and Non-Professional User to which they provide BATS One Feed data. See BATS One Fee Proposals, supra note 7. \11\ As defined in the Exchange's fee schedule, an External Distributor of an Exchange Market Data product is a Distributor that receives the Exchange Market Data product and then distributes that data to a third party or one or more Users outside the Distributor's own entity. \12\ As defined in the Exchange's fee schedule, a User of an Exchange Market Data product is a natural person, a proprietorship, corporation, partnership, or entity, or device (computer or other automated service), that is entitled to receive Exchange data. A Non-Professional User of an Exchange Market Data product is a natural person who is not: (i) Registered or qualified in any capacity with the Commission, the Commodity Futures Trading Commission, any state securities agency, any securities exchange or association, or any commodities or futures contract market or association; (ii) engaged as an ``investment adviser'' as that term is defined in Section 201(11) of the Investment Advisers Act of 1940 (whether or not registered or qualified under that Act); or (iii) employed by a bank or other organization exempt from registration under federal or state securities laws to perform functions that would require registration or qualification if such functions were performed for an organization not so exempt. A Professional User of an Exchange Market Data product is any User other than a Non- Professional User. \13\ The Data Consolidation Fee is $1,000 per month and is designed to reflect the value of the aggregation and consolidation function the Exchange performs in creating the BATS One Feed. See BATS One Fee Proposals, supra note 7. --------------------------------------------------------------------------- Non-Substantive Change to the Description of the BATS One Enterprise Fee The Exchange proposes a non-substantive change to the description of the BATS One Enterprise fee. The fee schedule currently states that, ``[a]s an alternative to User fees, a recipient firm may purchase a monthly Enterprise Fee to receive the BATS One Feed from an External Distributor for an unlimited number of Professional and Non- Professional Users.'' The Exchange proposes to amend this sentence in two ways. The first amendment is to state that a recipient firm may purchase a monthly Enterprise license, rather than Enterprise fee, as the term ``license'' is a more accurate description. The second is to specify that the recipient firm purchasing a monthly enterprise license does so to distribute the BATS One Feed to an unlimited number of Professional and Non-Professional Users. 2. Statutory Basis BATS One Digital Media Enterprise Fee The Exchange believes that the proposed Digital Media Enterprise Fee for the BATS One Feed is consistent with Section 6(b) of the Act,\14\ in general, and Section 6(b)(4) of the Act,\15\ in particular, in that it provides for an equitable allocation of reasonable fees among recipients of the data and is not designed to permit unfair discrimination among customers, brokers, or dealers. The Exchange also believes that the proposed rule change is consistent with Section 11(A) of the Act \16\ in that it supports (i) fair competition among brokers and dealers, among exchange markets, and between exchange markets and markets other than exchange markets and (ii) the availability to brokers, dealers, and investors of information with respect to quotations for and transactions in securities. Furthermore, the proposed rule change is consistent with Rule 603 of Regulation NMS,\17\ which provides that any national securities exchange that distributes information with respect to quotations for or transactions in an NMS stock do so on terms that are not unreasonably discriminatory. In adopting Regulation NMS, the Commission granted self-regulatory organizations and broker-dealers increased authority and flexibility to offer new and unique market data products to the public. It was believed that this authority would expand the amount of data available to consumers, and also spur innovation and competition for the provision of market data. --------------------------------------------------------------------------- \14\ 15 U.S.C. 78f. \15\ 15 U.S.C. 78f(b)(4). \16\ 15 U.S.C. 78k-1. \17\ See 17 CFR 242.603. --------------------------------------------------------------------------- In addition, the proposed fee is equitable and not unfairly discriminatory because it will apply uniformly to market data vendors, television broadcasters, Web site and mobile service providers. The Exchange believes it is reasonable to establish a lower cost fee structure that is designed to facilitate broader media distribution of the BATS One Data Feed for informational purposes because it will benefit investors generally. In establishing the Digital Media Enterprise Fee, the Exchange recognizes that there is demand for a more seamless and easier-to- administer data distribution mode that takes into account the expanded variety of media and communication devices that investors utilize today. The Exchange believes the Digital Media Enterprise Fee will be easy to administer because data recipients that purchase it would not be required to differentiate between Professional and Non-Professional Users, account for the extent of access to the data, or report the number of Users. This is a significant reduction on a recipient firm's administrative burdens and is a significant value to investors. For example, a television broadcaster could display the BATS One Feed data during market-related programming and on its Web site or allow viewers to view the data via their mobile devices, creating a more seamless distribution model that will allow investors more choice in how they receive and view market data, all without having to account for and/or measure who accesses the data and how often they do so. The proposed Digital Media Enterprise Fee is equitable and reasonable because it will also enable recipient firms to more widely distribute data from the BATS One Feed to investors for informational purposes at a lower cost than is available today. For example, a recipient firm may purchase an Enterprise license in the amount of $50,000 per month for the BATS One Summary Feed and $100,000 per month for the BATS One Premium Feed to receive the BATS One Feed from an External Distributor for an unlimited number of Professional and Non- Professional Users, which is greater than the Digital Media Enterprise fee proposed herein. The Exchange also believes the amount of the Digital Enterprise [sic] is reasonable as compared to the existing Enterprise fees discussed above because the distribution of BATS One Feed data is limited to television, Web sites, and mobile devices for informational purposes only, while distribution of the BATS One Feed data pursuant to an Enterprise license contains no such limitation. The Exchange also believes that the proposed Digital Media Enterprise fee is equitable and reasonable because it is less than similar fees charged by other exchanges.\18\ --------------------------------------------------------------------------- \18\ The Nasdaq Stock Market offers proprietary data products for distribution over the internet and television under alternative fee schedules that are subject to maximum fee of $50,000 per month. See Nasdaq Rule 7039(b). The NYSE charges a Digit Media Enterprise fee of $40,000 per month for the NYSE Trade Digital Media product. See Securities Exchange Act Release No. 69272 (April 2, 2013), 78 FR 20983 (April 8, 2013) (SR-NYSE-2013-23). --------------------------------------------------------------------------- [[Page 17793]] The Exchange has taken into consideration its affiliated relationship with BYX, EDGA, and EDGX in proposing the Digital Media Enterprise fee to assure that vendors would be able to offer a similar product on the same terms as the Exchange from a cost perspective. While the BATS Exchanges are the exclusive distributors of the individual data feeds from which certain data elements may be taken to create the BATS One Feed, they are not the exclusive distributors of the aggregated and consolidated information that comprises the BATS One Feed. As discussed in in the BATS One Fee Proposal,\19\ any entity may separately purchase the individual underlying products, and if they so choose, perform a similar aggregation and consolidation function that the Exchange performs in creating the BATS One Feed, and offer a data feed with the same information included in the BATS One Feed to sell and distribute it to its clients with no greater cost than the Exchange. --------------------------------------------------------------------------- \19\ See BATS One Fee Proposals, supra note 7. --------------------------------------------------------------------------- To enable such competition, the Exchange is offering the Digital Media Enterprise license for the BATS One Feed on terms that a subscriber of the underlying feeds could offer a competing product if it so chooses. The BATS One Feed is comprised of data included in EDGX Depth, EDGA Depth, BYX Depth, and BZX Depth.\20\ Currently, an External Distributor could create a competing product to the BATS One Premium Feed \21\ by purchasing each of these depth of book products from the individual BATS Exchanges and then performing its own aggregation and consolidation functions. The combined External Distributor fees for these individual data feeds of the BATS Exchanges is $12,500 per month.\22\ An External Distributor that seeks to create a competing product to the BATS One Summary Feed could instead subscribe to the following data feeds: EDGX Top, EDGX Last Sale, EDGA Top, EDGA Last Sale, BZX Top, BZX Last Sale, BYX Top, and BYX Last Sale,\23\ and then perform their own aggregation and consolidation function. The combined External Distributor fees for these individual data feeds of the BATS Exchanges is $5,000 per month.\24\ The Exchange proposes to charge a Digital Media Enterprise Fee ($15,000 per month for the BATS One Summary Feed and $25,000 per month for the BATS One Premium Feed, plus the $1,000 per month Data Consolidation fee) that exceeds the combined External Distributor fees for each of the individual feeds listed above to ensure that vendors could compete with the Exchange by creating the same product as the BATS One Feed to sell to their clients at no greater cost than the Exchange. --------------------------------------------------------------------------- \20\ See EDGA Rule 13.8, EDGX Rule 13.8, BZX Rule 11.22(a) and (c), and BYX Rule 11.22 (a) and (c) for a description of the depth of book feeds offered by each of the BATS Exchanges. \21\ Like the Exchange, an External Distributor would also be able to create a competing product to the BATS One Summary Feed from the data received via EDGX Depth, EDGA Depth, BYX Depth, and BZX Depth, without having to separately purchase the top and last sale feeds from each of the BATS Exchanges. \22\ The monthly External Distributor fee is $2,500 per month for EDGX Depth, $2,500 per month for EDGA Depth, $2,500 for BYX Depth, and $5,000 for BZX Depth. \23\ See supra note 6. See also BATS Rule 11.22(d) and (g). \24\ The monthly External Distributor fee is $1,250 per month for EDGX Top and EDGX Last Sale (as proposed herein), free for EDGA Top and EDGA Last Sale, $1,250 for BYX Top and BYX Last Sale, and $2,500 for BZX Top and BZX Last Sale. See BATS One Fee Proposals, supra note 7. --------------------------------------------------------------------------- The decision of the United States Court of Appeals for the District of Columbia Circuit in NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010), upheld the Commission's reliance upon the existence of competitive market mechanisms to set reasonable and equitably allocated fees for proprietary market data. In fact, the legislative history indicates that the Congress intended that the market system `evolve through the interplay of competitive forces as unnecessary regulatory restrictions are removed' and that the SEC wield its regulatory power `in those situations where competition may not be sufficient,' such as in the creation of a `consolidated transactional reporting system.' Id. at 535 (quoting H.R. Rep. No. 94-229 at 92 (1975), as reprinted in 1975 U.S.C.C.A.N. 323). The court agreed with the Commission's conclusion that ``Congress intended that `competitive forces should dictate the services and practices that constitute the U.S. national market system for trading equity securities.' '' \25\ --------------------------------------------------------------------------- \25\ NetCoalition, 615 F.3d at 535. --------------------------------------------------------------------------- As explained below in the Exchange's Statement on Burden on Competition, the Exchange believes that there is substantial evidence of competition in the marketplace for data and that the Commission can rely upon such evidence in concluding that the fees established in this filing are the product of competition and therefore satisfy the relevant statutory standards.\26\ In addition, the existence of alternatives to the BATS One Feed, including real-time consolidated data, free delayed consolidated data, and proprietary last sale data from other sources, as described below, further ensures that the Exchange cannot set unreasonable fees, or fees that are unreasonably discriminatory, when vendors and users can elect such alternatives. --------------------------------------------------------------------------- \26\ Section 916 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the ``Dodd-Frank Act'') amended paragraph (A) of Section 19(b)(3) of the Act, 15 U.S.C. 78s(b)(3), to make clear that all exchange fees for market data may be filed by exchanges on an immediately effective basis. --------------------------------------------------------------------------- As the NetCoalition decision noted, the Commission is not required to undertake a cost-of-service or ratemaking approach, and the Exchange incorporates by reference into this proposed rule change its affiliate's [sic] analysis of this topic in another rule filing.\27\ --------------------------------------------------------------------------- \27\ See Securities Exchange Act Release No. 63291 (Nov. 9, 2010), 75 FR 70311 (November 17, 2010) (SR-NYSEArca-2010-97). --------------------------------------------------------------------------- For these reasons, the Exchange believes that the proposed fees are reasonable, equitable, and not unfairly discriminatory. Non-Substantive Change to the Description of the BATS One Enterprise Fee The Exchange believes that the proposed change to the BATS One Enterprise Fee is consistent with Section 6(b) of the Act,\28\ in general, and Section 6(b)(4) of the Act,\29\ in particular, in that it provides for an equitable allocation of reasonable fees among recipients of the data and is not designed to permit unfair discrimination among customers, brokers, or dealers. The proposal to amend the description of the Enterprise fee within the fee schedule is equitable and reasonable because the changes are designed to clarify the fee schedule and avoid potential investor confusion. The proposed changes do not amend the amount or application of the BATS One Enterprise fee. The proposed changes are also non-discriminatory as they would apply to all recipient firms uniformly [sic]. --------------------------------------------------------------------------- \28\ 15 U.S.C. 78f. \29\ 15 U.S.C. 78f(b)(4). --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act, as amended. [[Page 17794]] BATS One Digital Media Enterprise Fee The BATS One Feed Digital Media Enterprise fee will enhance competition because it provides investors with an alternative option for receiving market data and competes directly with similar market data products currently offered by the NYSE and Nasdaq.\30\ The Exchange notes that there is already actual competition for products similar to the BATS One Feed. The NYSE offers BQT which provides BBO and last sale information for the NYSE, NYSE Arca Equities, Inc. and NYSE MKT LLC.\31\ Nasdaq offers Nasdaq Basic, a filed market data product, and through its affiliate, offers NLS Plus which provides a unified view of last sale information similar to the BATS One Feed.\32\ The existence of these competing data products demonstrates that there is ample, existing competition for products such as the BATS One Feed and the fees associated by such products is constrained by competition. --------------------------------------------------------------------------- \30\ See Nasdaq Basic, http://www.nasdaqtrader.com/Trader.aspx?id=nasdaqbasic (last visited May 29, 2014) (data feed offering the BBO and Last Sale information for all U.S. exchange- listed securities based on liquidity within the Nasdaq market center, as well as trades reported to the FINRA/Nasdaq Trade Reporting Facility (``TRF'')); Nasdaq NLS Plus, http://www.nasdaqtrader.com/Trader.aspx?id=NLSplus (last visited July 8, 2014) (data feed providing last sale data as well as consolidated volume from the following Nasdaq OMX markets for U.S. exchange- listed securities: Nasdaq, FINRA/Nasdaq TRF, Nasdaq OMX BX, and Nasdaq OMX PSX); Securities Exchange Act Release No. 73553 (November 6, 2014), 79 FR 67491 (November 13, 2014) (SR-NYSE-2014-40) (Notice of Amendment No. 1 and Order Granting Accelerated Approval to a Proposed Rule Change, as Modified by Amendment No.1, To Establish the NYSE Best Quote & Trades (``BQT'') Data Feed); http://www.nyxdata.com/Data-Products/NYSE-Best-Quote-and-Trades (last visited May 27, 2014) (data feed providing unified view of BBO and last sale information for the NYSE, NYSE Arca, and NYSE MKT). \31\ Id. \32\ Id. --------------------------------------------------------------------------- In establishing the proposed fees, the Exchange considered the competitiveness of the market for proprietary data and all of the implications of that competition. The Exchange believes that it has considered all relevant factors in order to establish fair, reasonable, and not unreasonably discriminatory fees and an equitable allocation of fees among all Users. The existence of alternatives to the BATS One Feed, including the existing underlying feeds, consolidated data, and proprietary data from other sources, ensures that the Exchange cannot set unreasonable fees, or fees that are unreasonably discriminatory, when vendors and subscribers can elect these alternatives or choose not to purchase a specific proprietary data product if its cost to purchase is not justified by the returns any particular vendor or subscriber would achieve through the purchase. Finally, although the BATS Exchanges are the exclusive distributors of the individual data feeds from which certain data elements would be taken to create the BATS One Feed, the Exchange is not the exclusive distributor of the aggregated and consolidated information that would compose the BATS One Feed. The Exchange has taken into consideration its affiliated relationship with BYX, EDGA, and EDGX in its design of the BATS One Feed to assure that vendors would be able to offer a similar product on the same terms as the Exchange from a cost perspective. While the BATS Exchanges are the exclusive distributors of the individual data feeds from which certain data elements may be taken to create the BATS One Feed, they are not the exclusive distributors of the aggregated and consolidated information that comprises the BATS One Feed. As discussed in in [sic] the BATS One Fee Proposal,\33\ any entity may separately purchase the individual underlying products, and if they so choose, perform a similar aggregation and consolidation function that the Exchange performs in creating the BATS One Feed, and offer a data feed with the same information included in the BATS One Feed to sell and distribute it to its clients with no greater cost than the Exchange. --------------------------------------------------------------------------- \33\ See BATS One Fee Proposals, supra note 7. --------------------------------------------------------------------------- To enable such competition, the amount of the proposed Digital Media Enterprise license compared to the cost of the individual data feeds from the BATS Exchanges would enable a vendor to receive the underlying data feeds and offer a similar product on a competitive basis and with no greater cost than the Exchange. The amount of the proposed Digital Media Enterprise license, coupled with the Data Consolidation Fee, is not lower than the cost to a vendor of receiving the underlying data feeds to create a competing product. Therefore, the amount of the proposed Digital Media Enterprise license the Exchange would charge clients for the BATS One Feed compared to the cost of the individual data feeds from the BATS Exchanges would enable a vendor to receive the underlying data feeds and offer a similar product on a competitive basis and with no greater cost than the Exchange. Non-Substantive Change to the Description of the BATS One Enterprise Fee The proposal to amend the description of the Enterprise fee within the fee schedule will not have any impact on completion [sic]. The proposed changes are designed to clarify the fee schedule and avoid potential investor confusion and do not amend the amount or application of the BATS One Enterprise fee. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has neither solicited nor received written comments on the proposed rule change. 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) of the Act \34\ and paragraph (f) of Rule 19b-4 thereunder.\35\ 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. --------------------------------------------------------------------------- \34\ 15 U.S.C. 78s(b)(3)(A). \35\ 17 CFR 240.19b-4(f). --------------------------------------------------------------------------- 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-BATS-2015-24 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-BATS-2015-24. 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 [[Page 17795]] 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 20549-1090, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such 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-BATS-2015-24, and should be submitted on or before April 23, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\36\ --------------------------------------------------------------------------- \36\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Brent J. Fields, Secretary. [FR Doc. 2015-07519 Filed 4-1-15; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 80, No. 63 / Thursday, April 2, 2015 / Notices 17791
(previously known as Let’s Move 2015, BATS Exchange, Inc. (the to the description of the BATS One Feed
Museums, Let’s Move Gardens), IMLS ‘‘Exchange’’ or ‘‘BZX’’) filed with the Enterprise fee.5
will collect information about Securities and Exchange Commission The Commission recently approved a
participant museums’ exhibits, (‘‘Commission’’) the proposed rule proposed rule change by the Exchange
programs, and food service operations change as described in Items I, II and III to establish a new market data product
that are targeted at fighting childhood below, which Items have been prepared called the BATS One Feed 6 as well as
obesity. The information will be used to by the Exchange. The Exchange has published proposed rule changes to
confirm program participation designated the proposed rule change as establish related fees.7 The BATS One
requirements and to share best practices one establishing or changing a member Feed is a data feed that disseminates, on
in public health programs. due, fee, or other charge imposed by the a real-time basis, the aggregate best bid
Current Actions: This notice proposes Exchange under Section 19(b)(3)(A)(ii) and offer (‘‘BBO’’) of all displayed
clearance of the Let’s Move! Museums & of the Act 3 and Rule 19b–4(f)(2) orders for securities traded on BZX and
Gardens registration form. The 60-day thereunder,4 which renders the its affiliated exchanges 8 and for which
notice for the Let’s Move! Museums & proposed rule change effective upon the BATS Exchanges report quotes
Gardens information collection was filing with the Commission. The under the Consolidated Tape
published in the Federal Register on Commission is publishing this notice to Association (‘‘CTA’’) Plan or the
December 5, 2014, (FR vol. 79, No. 234, solicit comments on the proposed rule Nasdaq/UTP Plan.9 The BATS One Feed
pgs. 72214–72215). No comments were change from interested persons. also contains the individual last sale
received. information for the BATS Exchanges
Agency: Institute of Museum and I. Self-Regulatory Organization’s (collectively with the aggregate BBO, the
Library Services. Statement of the Terms of Substance of ‘‘BATS One Summary Feed’’). In
Title: Let’s Move! Museums & the Proposed Rule Change addition, the BATS One Feed contains
Gardens. optional functionality which enables
OMB Number: 3137–0084. The Exchange filed a proposal to recipients to receive aggregated two-
Frequency: Annual. amend the market data section of its fee sided quotations from the BATS
Affected Public: Museums, state, schedule to: (i) Establish a Digital Media Exchanges for up to five (5) price levels
local, tribal government and not-for- Enterprise Fee for the BATS One Feed; (‘‘BATS One Premium Feed’’).
profit institutions. and (ii) make a non-substantive change
to the description of the BATS One Feed BATS One Digital Media Enterprise Fee
Number of Respondents: 50.
Estimated Time per Respondent: 0.17 Enterprise fee. The Exchange proposes to amend its
hours. The text of the proposed rule change fee schedule to establish a Digital Media
Total Annual Costs to Respondents: is available at the Exchange’s Web site Enterprise Fee of $15,000 per month for
$164. at www.batstrading.com, at the 5 The Exchange notes that the date of the fee
Total Annualized to Federal principal office of the Exchange, and at schedule was amended to March 17, 2015 in a
Government: $4,615. the Commission’s Public Reference previously filed proposed rule change. See SR–
Contact: Comments should be sent to Room. BATS–2015–23 (filed March 17, 2015).
Office of Information and Regulatory 6 See Securities Exchange Act Release No. 73918
Affairs, Attn.: OMB Desk Officer for II. Self-Regulatory Organization’s (December 23, 2014), 79 FR 78920 (December 31,
Statement of the Purpose of, and 2014) (File Nos. SR–EDGX–2014–25; SR–EDGA–
Education, Office of Management and 2014–25; SR–BATS–2014–055; SR–BYX–2014–030)
Budget, Room 10235, Washington, DC Statutory Basis for, the Proposed Rule (Notice of Amendments No. 2 and Order Granting
20503, (202) 395–7316. Change Accelerated Approval to Proposed Rule Changes, as
Modified by Amendments Nos. 1 and 2, to Establish
Dated: March 30, 2015. In its filing with the Commission, the a New Market Data Product called the BATS One
Kim A. Miller, Exchange included statements Feed) (‘‘BATS One Approval Order’’).
7 See Securities Exchange Act Release Nos. 74282
Management Analyst, Office of Planning, concerning the purpose of and basis for
(February 17, 2015), 80 FR 9487 (February 23, 2015)
Research, and Evaluation. the proposed rule change and discussed (SR–EDGX–2015–09); 74283 (February 18, 2015), 80
[FR Doc. 2015–07611 Filed 4–1–15; 8:45 am] any comments it received on the FR 9809 (February 24, 2015) (SR–EDGA–2015–09);
BILLING CODE CODE 7036–01–P proposed rule change. The text of these 74284 (February 18, 2015), 80 FR 9792 (February
statements may be examined at the 24, 2015) (SR–BYX–2015–09); and 74285 (February
18, 2015), 80 FR 9828 (February 24, 2015) (SR–
places specified in Item IV below. The BATS–2015–11) (‘‘BATS One Fee Proposals’’).
SECURITIES AND EXCHANGE Exchange has prepared summaries, set 8 BZX’s affiliated exchanges are EDGA Exchange,
COMMISSION forth in Sections A, B, and C below, of Inc. (‘‘EDGA’’), EDGX Exchange, Inc. (‘‘EDGX’’), and
the most significant parts of such BATS Y-Exchange, Inc. (‘‘BYX’’, together with
[Release No. 34–74598; File No. SR–BATS– EDGX, EDGA, and BZX, the ‘‘BATS Exchanges’’).
statements. On January 23, 2014, BATS Global Markets, Inc.
2015–24]
(‘‘BGMI’’), the former parent company of the
A. Self-Regulatory Organization’s Exchange and BYX, completed its business
Self-Regulatory Organizations; BATS Statement of the Purpose of, and combination with Direct Edge Holdings LLC, the
Exchange, Inc.; Notice of Filing and Statutory Basis for, the Proposed Rule parent company of EDGA and EDGX. See Securities
Immediate Effectiveness of a Proposed Change Exchange Act Release No. 71375 (January 23, 2014),
Rule Change To Amend the Fees for 79 FR 4771 (January 29, 2014) (SR–BATS–2013–
1. Purpose 059; SR–BYX–2013–039). Upon completion of the
the BATS One Market Data Product business combination, DE Holdings and BGMI each
The Exchange proposes to amend the became intermediate holding companies, held
March 27, 2015.
under a single new holding company. The new
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Pursuant to Section 19(b)(1) of the market data section of its fee schedule holding company, formerly named ‘‘BATS Global
Securities Exchange Act of 1934 (the to: (i) Establish a Digital Media Markets Holdings, Inc.,’’ changed its name to
‘‘Act’’),1 and Rule 19b–4 thereunder,2 Enterprise Fee for the BATS One Feed; ‘‘BATS Global Markets, Inc.’’ and BGMI changed its
and (ii) make a non-substantive change name to ‘‘BATS Global Markets Holdings, Inc.’’
notice is hereby given that on March 17, 9 The Exchange understands that each of the
BATS Exchanges will separately file substantially
1 15 U.S.C. 78s(b)(1). 3 15 U.S.C. 78s(b)(3)(A)(ii). similar proposed rule changes with the Commission
2 17 CFR 240.19b–4. 47 CFR 240.19b–4(f)(2). to implement fees for the BATS One Feed.
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![17792 Federal Register / Vol. 80, No. 63 / Thursday, April 2, 2015 / Notices
the BATS One Summary Feed and Professional Users.’’ The Exchange of the BATS One Data Feed for
$25,000 per month for the BATS One proposes to amend this sentence in two informational purposes because it will
Premium Feed. As an alternative to User ways. The first amendment is to state benefit investors generally.
fees,10 a recipient firm may purchase a that a recipient firm may purchase a In establishing the Digital Media
monthly Digital Media Enterprise monthly Enterprise license, rather than Enterprise Fee, the Exchange recognizes
license to receive the BATS One Feed Enterprise fee, as the term ‘‘license’’ is that there is demand for a more
from an External Distributor 11 to a more accurate description. The second seamless and easier-to-administer data
distribute to an unlimited number of is to specify that the recipient firm distribution mode that takes into
Professional and Non-Professional purchasing a monthly enterprise license account the expanded variety of media
Users 12 for viewing via television, Web does so to distribute the BATS One Feed and communication devices that
sites, and mobile devices for to an unlimited number of Professional investors utilize today. The Exchange
informational and non-trading purposes and Non-Professional Users. believes the Digital Media Enterprise
only without having to account for the Fee will be easy to administer because
2. Statutory Basis data recipients that purchase it would
extent of access to the data or the report
the number of Users to the Exchange. BATS One Digital Media Enterprise Fee not be required to differentiate between
The Digital Media Enterprise Fee would The Exchange believes that the Professional and Non-Professional
be in addition to the Data Consolidation proposed Digital Media Enterprise Fee Users, account for the extent of access
Fee.13 for the BATS One Feed is consistent to the data, or report the number of
with Section 6(b) of the Act,14 in Users. This is a significant reduction on
Non-Substantive Change to the a recipient firm’s administrative
Description of the BATS One Enterprise general, and Section 6(b)(4) of the Act,15
in particular, in that it provides for an burdens and is a significant value to
Fee investors. For example, a television
equitable allocation of reasonable fees
The Exchange proposes a non- among recipients of the data and is not broadcaster could display the BATS
substantive change to the description of designed to permit unfair One Feed data during market-related
the BATS One Enterprise fee. The fee discrimination among customers, programming and on its Web site or
schedule currently states that, ‘‘[a]s an brokers, or dealers. The Exchange also allow viewers to view the data via their
alternative to User fees, a recipient firm believes that the proposed rule change mobile devices, creating a more
may purchase a monthly Enterprise Fee is consistent with Section 11(A) of the seamless distribution model that will
to receive the BATS One Feed from an Act 16 in that it supports (i) fair allow investors more choice in how they
External Distributor for an unlimited competition among brokers and dealers, receive and view market data, all
number of Professional and Non- among exchange markets, and between without having to account for and/or
exchange markets and markets other measure who accesses the data and how
10 The Exchange assesses a monthly fee for
than exchange markets and (ii) the often they do so.
Professional Users of $10.00 per User for receipt of The proposed Digital Media
the BATS One Summary Feed or $15.00 per User availability to brokers, dealers, and
who elects to also receive the BATS One Premium investors of information with respect to Enterprise Fee is equitable and
Feed. Non-Professional Users are assessed a quotations for and transactions in reasonable because it will also enable
monthly fee of $0.25 per user for the BATS One
securities. Furthermore, the proposed recipient firms to more widely
Summary Feed or $0.50 per user for the BATS One
Premium Feed. External Distributors must count rule change is consistent with Rule 603 distribute data from the BATS One Feed
every Professional User and Non-Professional User of Regulation NMS,17 which provides to investors for informational purposes
to which they provide BATS One Feed data. See that any national securities exchange at a lower cost than is available today.
BATS One Fee Proposals, supra note 7. For example, a recipient firm may
11 As defined in the Exchange’s fee schedule, an that distributes information with respect
External Distributor of an Exchange Market Data to quotations for or transactions in an purchase an Enterprise license in the
product is a Distributor that receives the Exchange NMS stock do so on terms that are not amount of $50,000 per month for the
Market Data product and then distributes that data unreasonably discriminatory. In BATS One Summary Feed and $100,000
to a third party or one or more Users outside the per month for the BATS One Premium
Distributor’s own entity. adopting Regulation NMS, the
12 As defined in the Exchange’s fee schedule, a Commission granted self-regulatory Feed to receive the BATS One Feed
User of an Exchange Market Data product is a organizations and broker-dealers from an External Distributor for an
natural person, a proprietorship, corporation, increased authority and flexibility to unlimited number of Professional and
partnership, or entity, or device (computer or other Non-Professional Users, which is greater
automated service), that is entitled to receive
offer new and unique market data
Exchange data. A Non-Professional User of an products to the public. It was believed than the Digital Media Enterprise fee
Exchange Market Data product is a natural person that this authority would expand the proposed herein. The Exchange also
who is not: (i) Registered or qualified in any amount of data available to consumers, believes the amount of the Digital
capacity with the Commission, the Commodity Enterprise [sic] is reasonable as
Futures Trading Commission, any state securities
and also spur innovation and
agency, any securities exchange or association, or competition for the provision of market compared to the existing Enterprise fees
any commodities or futures contract market or data. discussed above because the
association; (ii) engaged as an ‘‘investment adviser’’ In addition, the proposed fee is distribution of BATS One Feed data is
as that term is defined in Section 201(11) of the equitable and not unfairly limited to television, Web sites, and
Investment Advisers Act of 1940 (whether or not
registered or qualified under that Act); or (iii) discriminatory because it will apply mobile devices for informational
employed by a bank or other organization exempt uniformly to market data vendors, purposes only, while distribution of the
from registration under federal or state securities television broadcasters, Web site and BATS One Feed data pursuant to an
laws to perform functions that would require Enterprise license contains no such
registration or qualification if such functions were
mobile service providers. The Exchange
performed for an organization not so exempt. A believes it is reasonable to establish a limitation. The Exchange also believes
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Professional User of an Exchange Market Data lower cost fee structure that is designed that the proposed Digital Media
product is any User other than a Non-Professional to facilitate broader media distribution Enterprise fee is equitable and
User. reasonable because it is less than similar
13 The Data Consolidation Fee is $1,000 per
month and is designed to reflect the value of the
14 15 U.S.C. 78f. fees charged by other exchanges.18
15 15 U.S.C. 78f(b)(4).
aggregation and consolidation function the
16 15 U.S.C. 78k–1. 18 The Nasdaq Stock Market offers proprietary
Exchange performs in creating the BATS One Feed.
See BATS One Fee Proposals, supra note 7. 17 See 17 CFR 242.603. data products for distribution over the internet and
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![Federal Register / Vol. 80, No. 63 / Thursday, April 2, 2015 / Notices 17793
The Exchange has taken into to the following data feeds: EDGX Top, of competition and therefore satisfy the
consideration its affiliated relationship EDGX Last Sale, EDGA Top, EDGA Last relevant statutory standards.26 In
with BYX, EDGA, and EDGX in Sale, BZX Top, BZX Last Sale, BYX addition, the existence of alternatives to
proposing the Digital Media Enterprise Top, and BYX Last Sale,23 and then the BATS One Feed, including real-time
fee to assure that vendors would be able perform their own aggregation and consolidated data, free delayed
to offer a similar product on the same consolidation function. The combined consolidated data, and proprietary last
terms as the Exchange from a cost External Distributor fees for these sale data from other sources, as
perspective. While the BATS Exchanges individual data feeds of the BATS described below, further ensures that
are the exclusive distributors of the Exchanges is $5,000 per month.24 The the Exchange cannot set unreasonable
individual data feeds from which Exchange proposes to charge a Digital fees, or fees that are unreasonably
certain data elements may be taken to Media Enterprise Fee ($15,000 per discriminatory, when vendors and users
create the BATS One Feed, they are not month for the BATS One Summary Feed can elect such alternatives.
the exclusive distributors of the and $25,000 per month for the BATS As the NetCoalition decision noted,
aggregated and consolidated One Premium Feed, plus the $1,000 per the Commission is not required to
information that comprises the BATS month Data Consolidation fee) that undertake a cost-of-service or
One Feed. As discussed in in the BATS exceeds the combined External ratemaking approach, and the Exchange
One Fee Proposal,19 any entity may Distributor fees for each of the incorporates by reference into this
separately purchase the individual individual feeds listed above to ensure proposed rule change its affiliate’s [sic]
underlying products, and if they so that vendors could compete with the analysis of this topic in another rule
choose, perform a similar aggregation Exchange by creating the same product filing.27
and consolidation function that the as the BATS One Feed to sell to their For these reasons, the Exchange
Exchange performs in creating the BATS clients at no greater cost than the believes that the proposed fees are
One Feed, and offer a data feed with the Exchange. reasonable, equitable, and not unfairly
same information included in the BATS The decision of the United States discriminatory.
One Feed to sell and distribute it to its Court of Appeals for the District of Non-Substantive Change to the
clients with no greater cost than the Columbia Circuit in NetCoalition v. Description of the BATS One Enterprise
Exchange. SEC, 615 F.3d 525 (D.C. Cir. 2010), Fee
To enable such competition, the upheld the Commission’s reliance upon
Exchange is offering the Digital Media The Exchange believes that the
the existence of competitive market
Enterprise license for the BATS One proposed change to the BATS One
mechanisms to set reasonable and
Feed on terms that a subscriber of the Enterprise Fee is consistent with
equitably allocated fees for proprietary
underlying feeds could offer a Section 6(b) of the Act,28 in general, and
market data.
competing product if it so chooses. The In fact, the legislative history Section 6(b)(4) of the Act,29 in
BATS One Feed is comprised of data indicates that the Congress intended particular, in that it provides for an
included in EDGX Depth, EDGA Depth, equitable allocation of reasonable fees
that the market system ‘evolve through
BYX Depth, and BZX Depth.20 among recipients of the data and is not
the interplay of competitive forces as
Currently, an External Distributor could designed to permit unfair
unnecessary regulatory restrictions are
create a competing product to the BATS discrimination among customers,
removed’ and that the SEC wield its
One Premium Feed 21 by purchasing brokers, or dealers. The proposal to
regulatory power ‘in those situations
each of these depth of book products amend the description of the Enterprise
where competition may not be
from the individual BATS Exchanges fee within the fee schedule is equitable
sufficient,’ such as in the creation of a
and then performing its own aggregation and reasonable because the changes are
‘consolidated transactional reporting
and consolidation functions. The designed to clarify the fee schedule and
system.’
combined External Distributor fees for Id. at 535 (quoting H.R. Rep. No. 94– avoid potential investor confusion. The
these individual data feeds of the BATS 229 at 92 (1975), as reprinted in 1975 proposed changes do not amend the
Exchanges is $12,500 per month.22 An U.S.C.C.A.N. 323). The court agreed amount or application of the BATS One
External Distributor that seeks to create with the Commission’s conclusion that Enterprise fee. The proposed changes
a competing product to the BATS One ‘‘Congress intended that ‘competitive are also non-discriminatory as they
Summary Feed could instead subscribe forces should dictate the services and would apply to all recipient firms
practices that constitute the U.S. uniformly [sic].
television under alternative fee schedules that are national market system for trading
subject to maximum fee of $50,000 per month. See
B. Self-Regulatory Organization’s
Nasdaq Rule 7039(b). The NYSE charges a Digit equity securities.’ ’’ 25 Statement on Burden on Competition
Media Enterprise fee of $40,000 per month for the As explained below in the Exchange’s
The Exchange does not believe that
NYSE Trade Digital Media product. See Securities Statement on Burden on Competition,
Exchange Act Release No. 69272 (April 2, 2013), 78 the proposed rule change will result in
the Exchange believes that there is
FR 20983 (April 8, 2013) (SR–NYSE–2013–23). any burden on competition that is not
substantial evidence of competition in
19 See BATS One Fee Proposals, supra note 7.
necessary or appropriate in furtherance
20 See EDGA Rule 13.8, EDGX Rule 13.8, BZX the marketplace for data and that the
of the purposes of the Act, as amended.
Rule 11.22(a) and (c), and BYX Rule 11.22 (a) and Commission can rely upon such
(c) for a description of the depth of book feeds evidence in concluding that the fees 26 Section 916 of the Dodd-Frank Wall Street
offered by each of the BATS Exchanges.
21 Like the Exchange, an External Distributor
established in this filing are the product Reform and Consumer Protection Act of 2010 (the
would also be able to create a competing product ‘‘Dodd-Frank Act’’) amended paragraph (A) of
to the BATS One Summary Feed from the data 23 See supra note 6. See also BATS Rule 11.22(d) Section 19(b)(3) of the Act, 15 U.S.C. 78s(b)(3), to
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received via EDGX Depth, EDGA Depth, BYX and (g). make clear that all exchange fees for market data
Depth, and BZX Depth, without having to 24 The monthly External Distributor fee is $1,250 may be filed by exchanges on an immediately
separately purchase the top and last sale feeds from per month for EDGX Top and EDGX Last Sale (as effective basis.
27 See Securities Exchange Act Release No. 63291
each of the BATS Exchanges. proposed herein), free for EDGA Top and EDGA
22 The monthly External Distributor fee is $2,500 Last Sale, $1,250 for BYX Top and BYX Last Sale, (Nov. 9, 2010), 75 FR 70311 (November 17, 2010)
per month for EDGX Depth, $2,500 per month for and $2,500 for BZX Top and BZX Last Sale. See (SR–NYSEArca–2010–97).
EDGA Depth, $2,500 for BYX Depth, and $5,000 for BATS One Fee Proposals, supra note 7. 28 15 U.S.C. 78f.
BZX Depth. 25 NetCoalition, 615 F.3d at 535. 29 15 U.S.C. 78f(b)(4).
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![17794 Federal Register / Vol. 80, No. 63 / Thursday, April 2, 2015 / Notices
BATS One Digital Media Enterprise Fee cost to purchase is not justified by the Non-Substantive Change to the
The BATS One Feed Digital Media returns any particular vendor or Description of the BATS One Enterprise
Enterprise fee will enhance competition subscriber would achieve through the Fee
because it provides investors with an purchase. The proposal to amend the
alternative option for receiving market Finally, although the BATS description of the Enterprise fee within
data and competes directly with similar Exchanges are the exclusive distributors the fee schedule will not have any
market data products currently offered of the individual data feeds from which impact on completion [sic]. The
by the NYSE and Nasdaq.30 The certain data elements would be taken to proposed changes are designed to clarify
Exchange notes that there is already create the BATS One Feed, the the fee schedule and avoid potential
actual competition for products similar Exchange is not the exclusive investor confusion and do not amend
to the BATS One Feed. The NYSE offers distributor of the aggregated and the amount or application of the BATS
BQT which provides BBO and last sale One Enterprise fee.
consolidated information that would
information for the NYSE, NYSE Arca
compose the BATS One Feed. The C. Self-Regulatory Organization’s
Equities, Inc. and NYSE MKT LLC.31
Exchange has taken into consideration Statement on Comments on the
Nasdaq offers Nasdaq Basic, a filed
its affiliated relationship with BYX, Proposed Rule Change Received From
market data product, and through its
EDGA, and EDGX in its design of the Members, Participants, or Others
affiliate, offers NLS Plus which provides
a unified view of last sale information BATS One Feed to assure that vendors The Exchange has neither solicited
similar to the BATS One Feed.32 The would be able to offer a similar product nor received written comments on the
existence of these competing data on the same terms as the Exchange from proposed rule change.
products demonstrates that there is a cost perspective. While the BATS III. Date of Effectiveness of the
ample, existing competition for Exchanges are the exclusive distributors Proposed Rule Change and Timing for
products such as the BATS One Feed of the individual data feeds from which Commission Action
and the fees associated by such products certain data elements may be taken to
is constrained by competition. create the BATS One Feed, they are not The foregoing rule change has become
In establishing the proposed fees, the effective pursuant to Section 19(b)(3)(A)
the exclusive distributors of the
Exchange considered the of the Act 34 and paragraph (f) of Rule
aggregated and consolidated 19b–4 thereunder.35 At any time within
competitiveness of the market for information that comprises the BATS
proprietary data and all of the 60 days of the filing of the proposed rule
One Feed. As discussed in in [sic] the change, the Commission summarily may
implications of that competition. The BATS One Fee Proposal,33 any entity
Exchange believes that it has considered temporarily suspend such rule change if
may separately purchase the individual it appears to the Commission that such
all relevant factors in order to establish
underlying products, and if they so action is necessary or appropriate in the
fair, reasonable, and not unreasonably
discriminatory fees and an equitable choose, perform a similar aggregation public interest, for the protection of
allocation of fees among all Users. The and consolidation function that the investors, or otherwise in furtherance of
existence of alternatives to the BATS Exchange performs in creating the BATS the purposes of the Act.
One Feed, including the existing One Feed, and offer a data feed with the
IV. Solicitation of Comments
underlying feeds, consolidated data, and same information included in the BATS
proprietary data from other sources, One Feed to sell and distribute it to its Interested persons are invited to
ensures that the Exchange cannot set clients with no greater cost than the submit written data, views, and
unreasonable fees, or fees that are Exchange. arguments concerning the foregoing,
unreasonably discriminatory, when including whether the proposed rule
To enable such competition, the change is consistent with the Act.
vendors and subscribers can elect these amount of the proposed Digital Media
alternatives or choose not to purchase a Comments may be submitted by any of
Enterprise license compared to the cost the following methods:
specific proprietary data product if its of the individual data feeds from the
BATS Exchanges would enable a vendor Electronic Comments
30 See Nasdaq Basic, http://
www.nasdaqtrader.com/ to receive the underlying data feeds and • Use the Commission’s Internet
Trader.aspx?id=nasdaqbasic (last visited May 29, offer a similar product on a competitive comment form (http://www.sec.gov/
2014) (data feed offering the BBO and Last Sale basis and with no greater cost than the rules/sro.shtml); or
information for all U.S. exchange-listed securities
based on liquidity within the Nasdaq market center, Exchange. The amount of the proposed • Send an email to rule-comments@
as well as trades reported to the FINRA/Nasdaq Digital Media Enterprise license, sec.gov. Please include File Number SR–
Trade Reporting Facility (‘‘TRF’’)); Nasdaq NLS coupled with the Data Consolidation BATS–2015–24 on the subject line.
Plus, http://www.nasdaqtrader.com/
Trader.aspx?id=NLSplus (last visited July 8, 2014) Fee, is not lower than the cost to a Paper Comments
(data feed providing last sale data as well as vendor of receiving the underlying data • Send paper comments in triplicate
consolidated volume from the following Nasdaq feeds to create a competing product.
OMX markets for U.S. exchange-listed securities: to Brent J. Fields, Secretary, Securities
Nasdaq, FINRA/Nasdaq TRF, Nasdaq OMX BX, and Therefore, the amount of the proposed and Exchange Commission, 100 F Street
Nasdaq OMX PSX); Securities Exchange Act Digital Media Enterprise license the NE., Washington, DC 20549–1090.
Release No. 73553 (November 6, 2014), 79 FR 67491 Exchange would charge clients for the
(November 13, 2014) (SR–NYSE–2014–40) (Notice All submissions should refer to File
of Amendment No. 1 and Order Granting BATS One Feed compared to the cost of
Number SR–BATS–2015–24. This file
Accelerated Approval to a Proposed Rule Change, the individual data feeds from the BATS
as Modified by Amendment No.1, To Establish the number should be included on the
Exchanges would enable a vendor to
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NYSE Best Quote & Trades (‘‘BQT’’) Data Feed); subject line if email is used. To help the
http://www.nyxdata.com/Data-Products/NYSE- receive the underlying data feeds and Commission process and review your
Best-Quote-and-Trades (last visited May 27, 2014) offer a similar product on a competitive comments more efficiently, please use
(data feed providing unified view of BBO and last basis and with no greater cost than the
sale information for the NYSE, NYSE Arca, and only one method. The Commission will
NYSE MKT).
Exchange.
31 Id. 34 15 U.S.C. 78s(b)(3)(A).
32 Id. 33 See BATS One Fee Proposals, supra note 7. 35 17 CFR 240.19b–4(f).
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![Federal Register / Vol. 80, No. 63 / Thursday, April 2, 2015 / Notices 17795
post all comments on the Commission’s the Exchange filed Amendment No. 1 to U.S. Bank, N.A.(the ‘‘Administrator’’ or
Internet Web site (http://www.sec.gov/ the proposed rule change, which ‘‘Custodian’’) will serve as the
rules/sro.shtml). Copies of the amended and replaced the proposal in administrator, custodian and transfer
submission, all subsequent its entirety. The proposed rule change agent for the Fund. Quasar Distributors,
amendments, all written statements was published for comment in the LLC will be the principal underwriter
with respect to the proposed rule Federal Register on February 20, 2015.3 and distributor of the Shares.
change that are filed with the No comments on the proposal have been The investment objective of the Fund
Commission, and all written received. This order approves the will be to seek long-term capital
communications relating to the proposed rule change, as modified by appreciation. Under normal
proposed rule change between the Amendment No. 1. circumstances,7 the Fund will invest at
Commission and any person, other than least 80% of its net assets in companies
those that may be withheld from the I. The Exchange’s Description of the included in the IBD® 50 Index (‘‘Index’’)
public in accordance with the Proposed Rule Change and in U.S. exchange-traded equities.8
provisions of 5 U.S.C. 552, will be The Exchange proposes to list and Typically, the Fund will hold U.S.
available for Web site viewing and trade the Shares under NYSE Arca exchange-traded common stocks as well
printing in the Commission’s Public Equities Rule 8.600, which governs the as U.S. exchange-traded master limited
Reference Room, 100 F Street NE., listing and trading of Managed Fund partnerships (‘‘MLPs’’), real estate
Washington, DC 20549–1090, on official Shares on the Exchange. The Shares will investment trusts (‘‘REITs’’), royalty
business days between the hours of be offered by Academy Funds Trust (the trusts and business development
10:00 a.m. and 3:00 p.m. Copies of such ‘‘Trust’’), an open-end management companies (‘‘BDCs’’). It will invest
filing also will be available for investment company.4 The Fund will primarily in U.S. equity securities but
inspection and copying at the principal issue and sell Shares only in ‘‘Creation may, to a lesser extent, invest in equity
office of the Exchange. All comments Unit’’ size at the NAV next determined securities of foreign companies in both
received will be posted without change; after receipt, on any business day, of an developed and emerging markets,
the Commission does not edit personal order in proper form.5 generally through American depositary
identifying information from The investment adviser to the Fund receipts (‘‘ADRs’’). The Fund may invest
submissions. You should submit only will be Innovator Management LLC (the in companies of any size.
information that you wish to make ‘‘Adviser’’). Penserra Capital Other Portfolio Holdings. The Fund
available publicly. All submissions Management LLC will be the Fund’s may invest in money market securities
should refer to File Number SR–BATS– sub-adviser (‘‘Sub-Adviser’’). Neither for liquidity and cash management
2015–24, and should be submitted on or the Adviser nor the Sub-Adviser is purposes or if the Adviser or Sub-
before April 23, 2015. registered as a broker-dealer. The Adviser determines that securities
For the Commission, by the Division of Adviser is not affiliated with a broker- meeting the Fund’s investment objective
Trading and Markets, pursuant to delegated dealer. The Sub-Adviser is affiliated and policies are not otherwise readily
authority.36 with a broker-dealer and has available for purchase. Money market
Brent J. Fields, implemented a ‘‘fire wall’’ with respect securities include (i) short-term U.S.
Secretary. to such broker-dealer regarding access to government securities; (ii) commercial
[FR Doc. 2015–07519 Filed 4–1–15; 8:45 am] information concerning the composition paper rated in the highest short-term
BILLING CODE 8011–01–P of or changes to the Fund’s portfolio.6 rating category by a nationally
recognized statistical ratings
3 See Securities Exchange Act Release No. 74278
(February 13, 2015), 80 FR 9294. wall’’ between the investment adviser and the
SECURITIES AND EXCHANGE 4 The Trust is registered under the 1940 Act. On broker-dealer reflects the applicable open-end
COMMISSION October 9, 2014 and on December 19, 2014, the fund’s portfolio, not an underlying benchmark
[Release No. 34–74595; File No. SR– Trust filed with the Commission amendments to its index, as is the case with index-based funds. The
registration statement on Form N–1A under the Exchange states that, in the event (a) the Adviser
NYSEArca–2015–04]
Securities Act of 1933 (15 U.S.C. 77a) (‘‘Securities or the Sub-Adviser becomes a registered broker-
Act’’) and under the 1940 Act relating to the Fund dealer or becomes newly affiliated with a broker-
Self-Regulatory Organizations; NYSE (File Nos. 333–146827 and 811–22135) dealer, or (b) any new adviser or any sub-adviser
Arca, Inc.; Order Approving Proposed (‘‘Registration Statement’’). In addition, the is a registered broker-dealer or becomes affiliated
Rule Change, as Modified by Commission has issued an order granting certain with a broker-dealer, it will implement a fire wall
Amendment No. 1, Relating to the exemptive relief to the Trust under the 1940 Act. with respect to its relevant personnel or its broker-
See Investment Company Act Release No. 31248 dealer affiliate regarding access to information
Listing and Trading of Shares of the (September 9, 2014) (File No. 812–14308) concerning the composition and/or changes to the
Innovator IBD® 50 Fund Under NYSE (‘‘Exemptive Order’’). Fund’s portfolio, and will be subject to procedures
Arca Equities Rule 8.600 5 A Creation Unit consists of 25,000 Shares, and designed to prevent the use and dissemination of
the size of a Creation Unit is subject to change. See material non-public information regarding such
March 27, 2015. Notice, supra note 3, 80 FR at 9296. portfolio.
7 The term ‘‘under normal circumstances’’ means,
On January 30, 2015, NYSE Arca, Inc. 6 Commentary .06 to Rule 8.600 provides that, if
the investment adviser to the investment company without limitation, the absence of extreme volatility
(the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed or trading halts in the equity markets or the
issuing Managed Fund Shares is affiliated with a
with the Securities and Exchange broker-dealer, such investment adviser shall erect a financial markets generally; operational issues
Commission (‘‘Commission’’), pursuant ‘‘fire wall’’ between the investment adviser and the causing dissemination of inaccurate market
to Section 19(b)(1) of the Securities broker-dealer with respect to access to information information; or force majeure type events such as
concerning the composition and/or changes to such systems failure, natural or man-made disaster, act
Exchange Act of 1934 (‘‘Act’’) 1 and Rule of God, armed conflict, act of terrorism, riot or labor
investment company portfolio. In addition,
19b–4 thereunder,2 a proposed rule Commentary .06 requires that personnel who make disruption or any similar intervening circumstance.
tkelley on DSK3SPTVN1PROD with NOTICES
change to list and trade shares decisions on the open-end fund’s portfolio 8 The Index is a computer-generated stock index
(‘‘Shares’’) of the Innovator IBD® 50 composition must be subject to procedures published by Investor’s Business Daily® (‘‘IBD®’’).
Fund (‘‘Fund’’). On February 12, 2015, designed to prevent the use and dissemination of IBD® uses proprietary fundamental and technical
material nonpublic information regarding the open- ratings to compile what IBD® considers the 50
end fund’s portfolio. Commentary .06 to Rule 8.600 leading growth companies that trade on U.S.
36 17 CFR 200.30–3(a)(12). is similar to Commentary .03(a)(i) and (iii) to NYSE national securities exchanges. Companies included
1 15 U.S.C. 78s(b)(1). Arca Equities Rule 5.2(j)(3); however, Commentary in the Index must meet minimum earnings, sales,
2 17 CFR 240.19b–4. .06 in connection with the establishment of a ‘‘fire profit margin, volume and technical requirements.
VerDate Sep<11>2014 18:52 Apr 01, 2015 Jkt 235001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 E:\FR\FM\02APN1.SGM 02APN1](https://thefederalregister.org/doc/80_FR_17854/page/5.svg)
Document Created: 2018-02-21 10:03:59
Document Modified: 2018-02-21 10:03:59
| 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 17791 |
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