80 FR 34753 - Self-Regulatory Organizations; EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees for Use of EDGA Exchange, Inc.
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 116 (June 17, 2015)
Federal Register Volume 80, Issue 116 (June 17, 2015)
| Page Range | 34753-34756 | |
| FR Document | 2015-14821 |
[Federal Register Volume 80, Number 116 (Wednesday, June 17, 2015)] [Notices] [Pages 34753-34756] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-14821] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-75147; File No. SR-EDGA-2015-24] Self-Regulatory Organizations; EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees for Use of EDGA Exchange, Inc. June 11, 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 June 9, 2015, EDGA Exchange, Inc. (the ``Exchange'' or ``EDGA'') 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.\3\ 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 \4\ and Rule 19b-4(f)(2) thereunder,\5\ 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\ The Commission notes that a previous version of the proposal was filed as SR-EDGA-2015-21. The proposal was withdrawn on June 9, 2015. \4\ 15 U.S.C. 78s(b)(3)(A)(ii). \5\ 17 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 its fees and rebates applicable to Members \6\ of the Exchange pursuant to EDGA Rule 15.1(a) and (c) (``Fee Schedule'') to: (i) Increase the rebate from $0.00040 per share to $0.00150 per share for orders that yield fee code A, which routes to the Nasdaq Stock Market LLC (``Nasdaq'') and adds liquidity; and (ii) adopt fees for the use of a communication and routing service known as BATS Connect. --------------------------------------------------------------------------- \6\ The term ``Member'' is defined as ``any registered broker or dealer, or any person associated with a registered broker or dealer, that has been admitted to membership in the Exchange. A Member will have the status of a ``member'' of the Exchange as that term is defined in Section 3(a)(3) of the Act.'' See Exchange Rule 1.5(n). --------------------------------------------------------------------------- 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: (i) Increase the rebate from $0.00040 per share to $0.00150 per share for orders that yield fee code A, which routes to Nasdaq and adds liquidity; and (ii) adopt fees for the use of a communication and routing service known as BATS Connect. Fee Code A In securities priced at or above $1.00, the Exchange currently provides a rebate of $0.00040 per share for Members' orders that yield fee code A, which routes to Nasdaq and adds liquidity. The Exchange proposes to amend its Fee Schedule to increase this rebate to $0.00150 per share for Members' orders that yield fee code A. The proposed change represents a pass through of the rate that BATS Trading, Inc. (``BATS Trading''), the Exchange's affiliated routing broker-dealer, is rebated for routing orders to Nasdaq when it does not qualify for a volume tiered rebate. When BATS Trading routes to Nasdaq, it is rebated a standard rate of $0.00150 per share.\7\ BATS Trading will pass through this rate on Nasdaq to the Exchange and the Exchange, in turn, will pass through this rate to its Members. The Exchange notes that the proposed change is in response to Nasdaq's June 2015 fee change where Nasdaq will no longer offer a rebate of $0.00040 per share for orders in select symbols (``Nasdaq's Select Symbol Program'') to its customers, such as [[Page 34754]] BATS Trading, and such orders will be subject to the regular Nasdaq Pricing Schedule.\8\ --------------------------------------------------------------------------- \7\ The Exchange notes that to the extent BATS Trading does or does not achieve any volume tiered discount on Nasdaq or routes an order to Nasdaq in a symbol that is not included in Nasdaq's Select Symbol Program to receive a rebate of $0.00150 per share, its rate for fee code A will not change. The Exchange further notes that, due to billing system limitations that do not allow for separate rates by tape, it will pass through the lesser rebate of $0.00150 per share for all Tapes A, B & C securities. \8\ See Nasdaq Equity Trader Alert #2015-70, Nasdaq Ends Access Fee Experiment, available at http://www.nasdaqtrader.com/TraderNews.aspx?id=ETA2015-70. --------------------------------------------------------------------------- BATS Connect On May 27, 2015, the Exchange filed a proposed rule change with the Commission to adopt a communication and routing service known as BATS Connect.\9\ The Exchange now proposes to adopt fees related to the use of BATS Connect that are equal to the fees charged for an identical service, also called BATS Connect, offered by the Exchange's affiliate, EDGX.\10\ BATS Connect is offered by the Exchange on a voluntary basis in a capacity similar to a vendor. In sum, BATS Connect is a communication service that provides subscribers an additional means to receive market data from and route orders to any destination connected to the Exchange's network. BATS Connect does not provide any advantage to subscribers for connecting to the Exchange's affiliates \11\ as compared to other method of connectivity available to subscribers. The servers of the subscriber need not be located in the same facilities as the Exchange in order to subscribe to BATS Connect. Subscribers may also seek to utilize BATS Connect in the event of a market disruption where other alternative connection methods become unavailable. --------------------------------------------------------------------------- \9\ See file no. SR-EDGA-2015-20. \10\ See the EDGX fee schedule available at http://batstrading.com/support/fee_schedule/edgx/. See also Securities Exchange Act Release No. 73780 (December 8, 2014), 79 FR 73942 (December 12, 2014) (SR-EDGX-2014-28) and file no. SR-EDGX-2015-27. \11\ The Exchange's affiliated exchanges are EDGX, BATS Exchange, Inc. (``BZX''), and BATS Y-Exchange, Inc. (``BYX''). The Exchange understands that its affiliated Exchange's intend to file identical proposed rule changes to adopt the fees for the BATS Connect service with the Commission. The Exchange also notes that its affiliated Exchanges have also filed proposed rule changes with the Commission to adopt rules describing the BATS Connect service. --------------------------------------------------------------------------- The Exchange will charge a monthly connectivity fee to subscribers utilizing BATS Connect to route orders to other exchanges and broker- dealers that are connected to the Exchange's network. The amount of the connectivity fee varies based solely on the bandwidth selected by the subscriber. Specifically, the Exchange proposes to charge $350 for 1 Mb, $700 for 5 Mb, $950 for 10 Mb, $1,500 for 25 Mb, $2,500 for 50 Mb, and $3,500 for 100 Mb. BATS Connect would also allow subscribers to receive market data feeds from the exchanges connected to the Exchange's network. In such case, the subscriber would pay the Exchange a connectivity fee, which varies and is based solely on the amount of bandwidth required to transmit the selected data product to the subscriber. The proposed connectivity fees are set forth in the Exhibit 5 attached hereto and range from no charge to $11,500 based on the market data product the subscriber selects. The Exchange also proposes to adopt a discounted fee of $4,160 per month for subscribers who purchase connectivity to a bundle of select market data products. The following market data products would be included in the bundle: UQDF/UTDF/OMDF, CQS/CTS, Nasdaq TotalView, Nasdaq BX TotalView, Nasdaq PSX TotalView, NYSE ArcaBook, NYSE MKT OpenBook Ultra, and BBS/TTDS. Absent the discount, a subscriber purchasing connectivity through BATS Connect for each of these market data products would pay a total monthly fee of $5,200. As proposed, a subscriber who purchases connectivity to each of the above market data products would be charged a monthly fee of $4,160, which represents a 20% discount. The subscribers would pay any fees charged by the exchange providing the market data feed directly to that exchange. The Exchange notes that it will not charge a fee to subscribers utilizing BATS Connect to route orders to or receive market data products from the Exchange's affiliates, EDGX, BZX, and BYX. BATS Connect provides subscribers a means to access exchanges and market centers on the Exchange's network. In all cases, BATS Connect subscribers would be continue to be liable for the necessary fees charged by that exchange or market center, including any required connectivity fees. Market participants who chose a method other than BATS Connect to connect to another exchange or market center would also pay any required connectivity fees directly to that exchange or market center. Likewise, BATS Connect subscribers would be liable for any connectivity fees charged by the Exchange's affiliate. Implementation Date The Exchange proposes to implement these amendments to its Fee Schedule immediately. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,\12\ in general, and furthers the objectives of Section 6(b)(4),\13\ in particular, as it is designed to provide for the equitable allocation of reasonable dues, fees and other charges among its Members and other persons using its facilities. The Exchange also notes that it operates in a highly- competitive market in which market participants can readily direct order flow to competing venues if they deem fee levels at a particular venue to be excessive. The proposed rule change reflects a competitive pricing structure designed to incent market participants to direct their order flow to the Exchange. The Exchange believes that the proposed rates are equitable and non-discriminatory in that they apply uniformly to all Members. The Exchange believes the fees and credits remain competitive with those charged by other venues and therefore continue to be reasonable and equitably allocated to Members. --------------------------------------------------------------------------- \12\ 15 U.S.C. 78f. \13\ 15 U.S.C. 78f(b)(4). --------------------------------------------------------------------------- Fee Code A The Exchange believes that its proposal to increase the pass through rebate for Members' orders that yield fee code A from $0.00040 to $0.00150 per share represents an equitable allocation of reasonable dues, fees, and other charges among Members and other persons using its facilities. Prior to Nasdaq's Select Symbol Program, Nasdaq provided BATS Trading a rebate of $0.00150 per share for orders yielding fee code A, which BATS Trading passed through to the Exchange and the Exchange passed through to its Members. In June 2015, Nasdaq terminated its Select Symbol Program, thereby increasing the rebate it provides its customers, such as BATS Trading, from a rebate of $0.00040 per share to its standard rebate of $0.00150 per share for orders that are routed to Nasdaq in symbols included in its Select Symbol Program.\14\ Therefore, the Exchange believes that the proposed change in fee code A from a rebate of $0.00040 per share to a rebate of $0.00150 per share is equitable and reasonable because it accounts for the pricing changes on Nasdaq. In addition, the proposal allows the Exchange to continue to charge its Members a pass-through rate for orders that are routed to Nasdaq. The Exchange notes that routing through BATS Trading is voluntary. Lastly, the Exchange also believes that the proposed amendment is non-discriminatory because it applies uniformly to all Members. --------------------------------------------------------------------------- \14\ See supra note 7. --------------------------------------------------------------------------- [[Page 34755]] BATS Connect The Exchange also believes that its proposal is consistent with Section 6(b)(4) of the Act,\15\ in that it provides for the equitable allocation of reasonable dues, fees and other charges among members and other persons using its facilities. First, the Exchange will charge a connectivity fee to subscribers utilizing BATS Connect to route orders to other exchanges and market centers that are connected to the Exchange's network, which varies based solely on the amount of bandwidth selected by the subscriber. The amounts of the connectivity fees are also reasonable as compared to similar fees charged by other exchanges. For purposes of order routing, the Exchange proposes to charge $350 for 1 Mb, $700 for 5 Mb, $950 for 10 Mb, $1,500 for 25 Mb, $2,500 for 50 Mb, and $3,500 for 100 Mb. The New York Stock Exchange, Inc. (``NYSE'') currently charges $300 for 1 Mb, $700 for 5 Mb, $900 for 10 Mb, $1,500 for 25 Mb, $2,000 for 50 Mb, and $2,600 for 100 Mb.\16\ The Exchange notes that, overall, the connectivity fee for routing of orders to other market centers proposed by the Exchange is similar to than that charged by the NYSE. --------------------------------------------------------------------------- \15\ 15 U.S.C. 78f(b)(4). \16\ See NYSE's SFTI Americas Product and Service List available at http://www.nyxdata.com/docs/connectivity. --------------------------------------------------------------------------- Second, with regard to utilizing BATS Connect to receive market data products from other exchanges, the Exchange would only charge subscribers a connectivity fee, the amount of which is based solely on the amount of bandwidth required to transmit that specific data product to the subscribers. The amounts of the connectivity fees are also reasonable as compared to similar fees charged by other exchanges. For example, for market data connectivity, the Nasdaq Stock Market LLC (``Nasdaq'') charges $1,412 per month for CQS/CTS data feed, and the Exchange proposes to charge $1,000 per month connectivity for CQS/CTS data feed.\17\ The Exchange notes that, overall, the connectivity fee for receipt of other market centers' data feed proposed by the Exchange is similar to that charged by Nasdaq. --------------------------------------------------------------------------- \17\ See Nasdaq Rule 7034 (setting forth Nasdaq's connectivity fees for receipt of third party market data products). --------------------------------------------------------------------------- The Exchange believes it is reasonable to offer such discounted pricing to subscribers who purchase connectivity to a bundle of market data products as it would enable them to reduce their overall connectivity costs for the receipt of market data. As stated above, BATS Connect is offered and purchased on a voluntary basis and subscribers can discontinue use at any time and for any reason, including due to an assessment of the reasonableness of fees charged. Moreover, the Exchange believes the proposed fees are reasonable and equitable because they continue to be based on the Exchange's costs to cover the amount of bandwidth required to provide connectivity to the select bundle of data feeds. The proposed fees will continue to allow the Exchange to recoup this cost, while providing subscribers with an alternative means to connect to the select bundle of data feeds at a discounted rate. The subscribers would pay any fees: (i) Charged by the exchange providing the market data feed directly to that exchange (ii) charged by a market center to which they routed an order and an execution occurred directly to that market center. The Exchange itself would not charge any additional fees.\18\ BATS Connect is offered and purchased on a voluntary basis, in that neither the Exchange nor subscribers are required by any rule or regulation to make this product available. Accordingly, subscribers can discontinue use at any time and for any reason, including due to an assessment of the reasonableness of fees charged. --------------------------------------------------------------------------- \18\ The Exchange's rules and fees would not address the fees or manner of operation of any destination to which the subscriber asked that an order be routed. --------------------------------------------------------------------------- Moreover, the Exchange believes the proposed fees are reasonable and equitable because they are based on the Exchange's costs to cover hardware, installation, testing and connection, as well as expenses involved in maintaining and managing the service. The proposed fees allow the Exchange to recoup these costs, while providing subscribers with an alternative means to connect to other exchange and market centers. The Exchange believes that the proposed fees are reasonable and equitable in that they reflect the costs and the benefit of providing alternative connectivity. The Exchange also believes it is equitable and reasonable to provide BATS Connect to subscribers for no charge to route orders to or receive market data products from the Exchange's affiliates. BATS Connect provides subscribers a means to access exchanges and market centers on the Exchange's network. In all cases, BATS Connect subscribers would be continue to be liable for the necessary fees charged by the Exchange, its affiliate, or another exchange or market center, including any required connectivity fees. As stated above, BATS Connect is offered and purchased on a voluntary basis, and subscribers and market participants may choose an alternative method to connect to the Exchange, its affiliates, or another exchange or market center connected to the Exchange's network. Such other services may also offer at no charge connectivity to certain exchanges or a group of exchanges.\19\ Therefore, the Exchange believes that the [sic] providing BATS Connect to subscribers at no charge to route orders to or receive market data products from the Exchange's affiliates is reasonable and equitable as they will continue to be liable to the Exchange or its affiliate for any required connectivity fees. --------------------------------------------------------------------------- \19\ See NYSE's SFTI Americas Product and Service List available at http://www.nyxdata.com/docs/connectivity (offering at no charge connectivity to the NYSE, NYSE MKT LLC, and NYSE Arca, Inc.). --------------------------------------------------------------------------- Lastly, the Exchange also believes that the proposed amendments to its fee schedule are non-discriminatory because they will apply uniformly to all subscribers. All subscribers that voluntarily select various service options will be charged the same amount for the same services. All subscribers have the option to select any connectivity option, and there is no differentiation among subscribers with regard to the fees charged for the service. Further, the benefits of selecting such services are the same for all subscribers, irrespective of whether their servers are located in the same facility as the Exchange. (B) Self-Regulatory Organization's Statement on Burden on Competition The Exchange believes its proposed amendments to its Fee Schedule would not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed change represents a significant departure from previous pricing offered by the Exchange or pricing offered by the Exchange's competitors. Additionally, Members may opt to disfavor the Exchange's pricing if they believe that alternatives offer them better value. Accordingly, the Exchange does not believe that the proposed change will impair the ability of Members or competing venues to maintain their competitive standing in the financial markets. Fee Code A The Exchange believes that its proposal to pass through a rebate of $0.00150 per share for Members' orders that yield fee code A would increase intermarket competition because it offers customers an alternative means to [[Page 34756]] route to Nasdaq for a similar rate as entering orders in certain symbols on Nasdaq directly. The Exchange believes that its proposal would not burden intramarket competition because the proposed rate would apply uniformly to all Members. BATS Connect The Exchange believes the proposed fees for BATS Connect will not result in any burden on competition. The proposed rule change is designed to provide subscribers with an alternative means to access other market centers on the Exchange's network if they choose or in the event of a market disruption where other alternative connection methods become unavailable. BATS Connect is not the exclusive method to connect to these market centers and subscribers may utilize alternative methods to connect to the product if they believe the Exchange's proposed pricing is unreasonable or otherwise. Therefore, the Exchange does not believe the proposed rule change will have any effect on competition. (C) Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any unsolicited written comments from Members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act \20\ and paragraph (f) of Rule 19b-4 thereunder.\21\ 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. --------------------------------------------------------------------------- \20\ 15 U.S.C. 78s(b)(3)(A). \21\ 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-EDGA-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-EDGA-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 post all comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission's Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing will also be available for inspection and copying at the 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-EDGA-2015-24 and should be submitted on or before July 8, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\22\ --------------------------------------------------------------------------- \22\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2015-14821 Filed 6-16-15; 8:45 am] BILLING CODE 8011-01-P
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proposed requirement that the members SECURITIES AND EXCHANGE II. Self-Regulatory Organization’s
of the ROC consist of either directors of COMMISSION Statement of the Purpose of, and
the Exchange or directors of NYSE Statutory Basis for, the Proposed Rule
[Release No. 34–75147; File No. SR–EDGA–
Regulation who satisfy the 2015–24]
Change
independence requirements of the In its filing with the Commission, the
Exchange’s Company Director Self-Regulatory Organizations; EDGA Exchange included statements
Independence Policy, and the Exchange, Inc.; Notice of Filing and concerning the purpose of and basis for
provisions relating to the removal of a Immediate Effectiveness of a Proposed the proposed rule change and discussed
member of the ROC either for cause or Rule Change Related to Fees for Use any comments it received on the
for failing to qualify as independent, of EDGA Exchange, Inc. proposed rule change. The text of these
should help ensure the continued statements may be examined at the
June 11, 2015.
independence of the members of the places specified in Item IV below. The
Pursuant to Section 19(b)(1) of the
ROC. The proposal to establish a ROC Exchange has prepared summaries, set
Securities Exchange Act of 1934 (the
should assist the Exchange in meeting forth in Sections A, B, and C below, of
‘‘Act’’),1 and Rule 19b–4 thereunder,2
its statutory obligations to comply, and the most significant parts of such
notice is hereby given that on June 9,
to enforce compliance by its members statements.
2015, EDGA Exchange, Inc. (the
and persons associated with its ‘‘Exchange’’ or ‘‘EDGA’’) filed with the (A) Self-Regulatory Organization’s
members, with the Act, the rules and Securities and Exchange Commission Statement of the Purpose of, and
regulations thereunder, and the rules of (‘‘Commission’’) the proposed rule Statutory Basis for, the Proposed Rule
the Exchange. change as described in Items I, II and III Change
The Commission notes that, while the below, which Items have been prepared 1. Purpose
by the Exchange.3 The Exchange has
proposal removes the requirement that The Exchange proposes to: (i) Increase
designated the proposed rule change as
the independent directors who make up the rebate from $0.00040 per share to
one establishing or changing a member
the majority of the Board also be ICE due, fee, or other charge imposed by the $0.00150 per share for orders that yield
directors, it does not alter the Exchange under Section 19(b)(3)(A)(ii) fee code A, which routes to Nasdaq and
requirement under the Operating of the Act 4 and Rule 19b–4(f)(2) adds liquidity; and (ii) adopt fees for the
Agreement that a majority of the Board thereunder,5 which renders the use of a communication and routing
must satisfy the Exchange’s Company proposed rule change effective upon service known as BATS Connect.
Director Independence Policy.16 Thus, filing with the Commission. The Fee Code A
the majority of directors on the Commission is publishing this notice to
Exchange’s Board must still qualify as In securities priced at or above $1.00,
solicit comments on the proposed rule
independent directors under the the Exchange currently provides a
change from interested persons.
Exchange’s Company Director rebate of $0.00040 per share for
I. Self-Regulatory Organization’s Members’ orders that yield fee code A,
Independence Policy. Moreover,
Statement of the Terms of Substance of which routes to Nasdaq and adds
removing the requirement that the
the Proposed Rule Change liquidity. The Exchange proposes to
independent directors on the amend its Fee Schedule to increase this
Exchange’s Board also be directors of The Exchange filed a proposal to
amend its fees and rebates applicable to rebate to $0.00150 per share for
ICE may result in a more diversified Members’ orders that yield fee code A.
Board composition as candidates for Members 6 of the Exchange pursuant to
EDGA Rule 15.1(a) and (c) (‘‘Fee The proposed change represents a pass
membership on the Board who qualify through of the rate that BATS Trading,
Schedule’’) to: (i) Increase the rebate
as independent under the Company Inc. (‘‘BATS Trading’’), the Exchange’s
from $0.00040 per share to $0.00150 per
Director Independence Policy need not affiliated routing broker-dealer, is
share for orders that yield fee code A,
be limited to those candidates who also rebated for routing orders to Nasdaq
which routes to the Nasdaq Stock
serve on the board of directors of ICE. Market LLC (‘‘Nasdaq’’) and adds when it does not qualify for a volume
Accordingly, the Commission finds liquidity; and (ii) adopt fees for the use tiered rebate. When BATS Trading
that the proposed rule change is of a communication and routing service routes to Nasdaq, it is rebated a standard
consistent with the Act. known as BATS Connect. rate of $0.00150 per share.7 BATS
The text of the proposed rule change Trading will pass through this rate on
IV. Conclusion is available at the Exchange’s Web site Nasdaq to the Exchange and the
at www.batstrading.com, at the Exchange, in turn, will pass through this
It is therefore ordered, pursuant to rate to its Members. The Exchange notes
Section 19(b)(2) of the Act, that the principal office of the Exchange, and at
the Commission’s Public Reference that the proposed change is in response
proposed rule change (SR–NYSEMKT– to Nasdaq’s June 2015 fee change where
Room.
2015–27) is approved. Nasdaq will no longer offer a rebate of
For the Commission, by the Division of 1 15 U.S.C. 78s(b)(1). $0.00040 per share for orders in select
Trading and Markets, pursuant to delegated 2 17 CFR 240.19b–4. symbols (‘‘Nasdaq’s Select Symbol
authority.17 3 The Commission notes that a previous version Program’’) to its customers, such as
of the proposal was filed as SR–EDGA–2015–21.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Robert W. Errett, The proposal was withdrawn on June 9, 2015. 7 The Exchange notes that to the extent BATS
Deputy Secretary. 4 15 U.S.C. 78s(b)(3)(A)(ii).
Trading does or does not achieve any volume tiered
5 17 CFR 240.19b–4(f)(2).
[FR Doc. 2015–14822 Filed 6–16–15; 8:45 am] discount on Nasdaq or routes an order to Nasdaq
6 The term ‘‘Member’’ is defined as ‘‘any in a symbol that is not included in Nasdaq’s Select
BILLING CODE 8011–01–P
registered broker or dealer, or any person associated Symbol Program to receive a rebate of $0.00150 per
with a registered broker or dealer, that has been share, its rate for fee code A will not change. The
admitted to membership in the Exchange. A Exchange further notes that, due to billing system
Member will have the status of a ‘‘member’’ of the limitations that do not allow for separate rates by
16 See supra note 6. Exchange as that term is defined in Section 3(a)(3) tape, it will pass through the lesser rebate of
17 17 CFR 200.30–3(a)(12). of the Act.’’ See Exchange Rule 1.5(n). $0.00150 per share for all Tapes A, B & C securities.
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BATS Connect Connect is offered and purchased on a fees. As stated above, BATS Connect is
The Exchange also believes that its voluntary basis and subscribers can offered and purchased on a voluntary
proposal is consistent with Section discontinue use at any time and for any basis, and subscribers and market
6(b)(4) of the Act,15 in that it provides reason, including due to an assessment participants may choose an alternative
for the equitable allocation of reasonable of the reasonableness of fees charged. method to connect to the Exchange, its
dues, fees and other charges among Moreover, the Exchange believes the affiliates, or another exchange or market
members and other persons using its proposed fees are reasonable and center connected to the Exchange’s
facilities. First, the Exchange will charge equitable because they continue to be network. Such other services may also
a connectivity fee to subscribers based on the Exchange’s costs to cover offer at no charge connectivity to certain
utilizing BATS Connect to route orders the amount of bandwidth required to exchanges or a group of exchanges.19
to other exchanges and market centers provide connectivity to the select Therefore, the Exchange believes that
bundle of data feeds. The proposed fees the [sic] providing BATS Connect to
that are connected to the Exchange’s
will continue to allow the Exchange to subscribers at no charge to route orders
network, which varies based solely on
recoup this cost, while providing to or receive market data products from
the amount of bandwidth selected by
subscribers with an alternative means to the Exchange’s affiliates is reasonable
the subscriber. The amounts of the
connect to the select bundle of data and equitable as they will continue to be
connectivity fees are also reasonable as
feeds at a discounted rate. liable to the Exchange or its affiliate for
compared to similar fees charged by
The subscribers would pay any fees: any required connectivity fees.
other exchanges. For purposes of order Lastly, the Exchange also believes that
routing, the Exchange proposes to (i) Charged by the exchange providing
the market data feed directly to that the proposed amendments to its fee
charge $350 for 1 Mb, $700 for 5 Mb, schedule are non-discriminatory
$950 for 10 Mb, $1,500 for 25 Mb, exchange (ii) charged by a market center
to which they routed an order and an because they will apply uniformly to all
$2,500 for 50 Mb, and $3,500 for 100 subscribers. All subscribers that
Mb. The New York Stock Exchange, Inc. execution occurred directly to that
market center. The Exchange itself voluntarily select various service
(‘‘NYSE’’) currently charges $300 for 1 options will be charged the same
Mb, $700 for 5 Mb, $900 for 10 Mb, would not charge any additional fees.18
BATS Connect is offered and purchased amount for the same services. All
$1,500 for 25 Mb, $2,000 for 50 Mb, and subscribers have the option to select any
$2,600 for 100 Mb.16 The Exchange on a voluntary basis, in that neither the
Exchange nor subscribers are required connectivity option, and there is no
notes that, overall, the connectivity fee differentiation among subscribers with
for routing of orders to other market by any rule or regulation to make this
product available. Accordingly, regard to the fees charged for the
centers proposed by the Exchange is service. Further, the benefits of selecting
similar to than that charged by the subscribers can discontinue use at any
time and for any reason, including due such services are the same for all
NYSE. subscribers, irrespective of whether
Second, with regard to utilizing BATS to an assessment of the reasonableness
of fees charged. their servers are located in the same
Connect to receive market data products facility as the Exchange.
from other exchanges, the Exchange Moreover, the Exchange believes the
would only charge subscribers a proposed fees are reasonable and (B) Self-Regulatory Organization’s
connectivity fee, the amount of which is equitable because they are based on the Statement on Burden on Competition
based solely on the amount of Exchange’s costs to cover hardware,
The Exchange believes its proposed
bandwidth required to transmit that installation, testing and connection, as
amendments to its Fee Schedule would
specific data product to the subscribers. well as expenses involved in
not impose any burden on competition
The amounts of the connectivity fees are maintaining and managing the service.
that is not necessary or appropriate in
also reasonable as compared to similar The proposed fees allow the Exchange furtherance of the purposes of the Act.
fees charged by other exchanges. For to recoup these costs, while providing The Exchange does not believe that the
example, for market data connectivity, subscribers with an alternative means to proposed change represents a significant
the Nasdaq Stock Market LLC connect to other exchange and market departure from previous pricing offered
(‘‘Nasdaq’’) charges $1,412 per month centers. The Exchange believes that the by the Exchange or pricing offered by
for CQS/CTS data feed, and the proposed fees are reasonable and the Exchange’s competitors.
Exchange proposes to charge $1,000 per equitable in that they reflect the costs Additionally, Members may opt to
month connectivity for CQS/CTS data and the benefit of providing alternative disfavor the Exchange’s pricing if they
feed.17 The Exchange notes that, overall, connectivity. believe that alternatives offer them
The Exchange also believes it is better value. Accordingly, the Exchange
the connectivity fee for receipt of other
equitable and reasonable to provide does not believe that the proposed
market centers’ data feed proposed by
BATS Connect to subscribers for no change will impair the ability of
the Exchange is similar to that charged
charge to route orders to or receive Members or competing venues to
by Nasdaq.
The Exchange believes it is reasonable market data products from the maintain their competitive standing in
to offer such discounted pricing to Exchange’s affiliates. BATS Connect the financial markets.
subscribers who purchase connectivity provides subscribers a means to access
exchanges and market centers on the Fee Code A
to a bundle of market data products as
it would enable them to reduce their Exchange’s network. In all cases, BATS The Exchange believes that its
overall connectivity costs for the receipt Connect subscribers would be continue proposal to pass through a rebate of
asabaliauskas on DSK5VPTVN1PROD with NOTICES
of market data. As stated above, BATS to be liable for the necessary fees $0.00150 per share for Members’ orders
charged by the Exchange, its affiliate, or that yield fee code A would increase
15 15 U.S.C. 78f(b)(4). another exchange or market center, intermarket competition because it
16 See NYSE’s SFTI Americas Product and Service including any required connectivity offers customers an alternative means to
List available at http://www.nyxdata.com/docs/
connectivity. 18 The Exchange’s rules and fees would not 19 See NYSE’s SFTI Americas Product and Service
17 See Nasdaq Rule 7034 (setting forth Nasdaq’s address the fees or manner of operation of any List available at http://www.nyxdata.com/docs/
connectivity fees for receipt of third party market destination to which the subscriber asked that an connectivity (offering at no charge connectivity to
data products). order be routed. the NYSE, NYSE MKT LLC, and NYSE Arca, Inc.).
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![34756 Federal Register / Vol. 80, No. 116 / Wednesday, June 17, 2015 / Notices
route to Nasdaq for a similar rate as Electronic Comments SECURITIES AND EXCHANGE
entering orders in certain symbols on COMMISSION
Nasdaq directly. The Exchange believes • Use the Commission’s Internet
that its proposal would not burden comment form (http://www.sec.gov/
[Release No. 34–75156; File No. SR–
intramarket competition because the rules/sro.shtml); or
NYSEArca–2015–45]
proposed rate would apply uniformly to • Send an email to rule-comments@
all Members. sec.gov. Please include File Number SR– Self-Regulatory Organizations; NYSE
BATS Connect EDGA–2015–24 on the subject line. Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Paper Comments
The Exchange believes the proposed Rule Change Revising the Schedule for
fees for BATS Connect will not result in • Send paper comments in triplicate Implementing the Exchange’s Recently
any burden on competition. The to Brent J. Fields, Secretary, Securities Approved Rule To Provide a Price
proposed rule change is designed to and Exchange Commission, 100 F Street Protection for Market Maker Quotes
provide subscribers with an alternative NE., Washington, DC 20549–1090. Pursuant to Rule 6.61
means to access other market centers on
the Exchange’s network if they choose All submissions should refer to File June 11, 2015.
or in the event of a market disruption Number SR–EDGA–2015–24. This file Pursuant to Section 19(b)(1) 1 of the
where other alternative connection number should be included on the Securities Exchange Act of 1934 (the
methods become unavailable. BATS subject line if email is used. To help the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
Connect is not the exclusive method to Commission process and review your notice is hereby given that, on June 5,
connect to these market centers and comments more efficiently, please use 2015, NYSE Arca, Inc. (the ‘‘Exchange’’
subscribers may utilize alternative only one method. The Commission will or ‘‘NYSE Arca’’) filed with the
methods to connect to the product if post all comments on the Commission’s
they believe the Exchange’s proposed Securities and Exchange Commission
Internet Web site (http://www.sec.gov/ (the ‘‘Commission’’) the proposed rule
pricing is unreasonable or otherwise. rules/sro.shtml). Copies of the
Therefore, the Exchange does not change as described in Items I and II
submission, all subsequent below, which Items have been prepared
believe the proposed rule change will amendments, all written statements
have any effect on competition. by the self-regulatory organization. The
with respect to the proposed rule Commission is publishing this notice to
(C) Self-Regulatory Organization’s change that are filed with the solicit comments on the proposed rule
Statement on Comments on the Commission, and all written change from interested persons.
Proposed Rule Change Received From communications relating to the
Members, Participants or Others proposed rule change between the I. Self-Regulatory Organization’s
Commission and any person, other than Statement of the Terms of the Substance
The Exchange has not solicited, and those that may be withheld from the of the Proposed Rule Change
does not intend to solicit, comments on public in accordance with the
this proposed rule change. The provisions of 5 U.S.C. 552, will be The Exchange proposes to revise the
Exchange has not received any available for Web site viewing and schedule for implementing the
unsolicited written comments from printing in the Commission’s Public Exchange’s recently approved rule to
Members or other interested parties. provide a price protection for Market
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official Maker quotes pursuant to Rule 6.61. The
III. Date of Effectiveness of the
business days between the hours of text of the proposed rule change is
Proposed Rule Change and Timing for
Commission Action 10:00 a.m. and 3:00 p.m. Copies of the available on the Exchange’s Web site at
filing will also be available for www.nyse.com, at the principal office of
The foregoing rule change has become inspection and copying at the principal the Exchange, and at the Commission’s
effective pursuant to Section 19(b)(3)(A) office of the Exchange. All comments Public Reference Room.
of the Act 20 and paragraph (f) of Rule
received will be posted without change; II. Self-Regulatory Organization’s
19b–4 thereunder.21 At any time within
the Commission does not edit personal Statement of the Purpose of, and
60 days of the filing of the proposed rule
identifying information from Statutory Basis for, the Proposed Rule
change, the Commission summarily may
temporarily suspend such rule change if submissions. You should submit only Change
it appears to the Commission that such information that you wish to make
available publicly. All submissions In its filing with the Commission, the
action is necessary or appropriate in the
should refer to File Number SR–EDGA– self-regulatory organization included
public interest, for the protection of
2015–24 and should be submitted on or statements concerning the purpose of,
investors, or otherwise in furtherance of
before July 8, 2015. and basis for, the proposed rule change
the purposes of the Act.
and discussed any comments it received
For the Commission, by the Division of
IV. Solicitation of Comments on the proposed rule change. The text
Trading and Markets, pursuant to delegated
authority.22
of those statements may be examined at
Interested persons are invited to the places specified in Item IV below.
submit written data, views, and Robert W. Errett,
asabaliauskas on DSK5VPTVN1PROD with NOTICES
The Exchange has prepared summaries,
arguments concerning the foregoing, Deputy Secretary. set forth in sections A, B, and C below,
including whether the proposed rule [FR Doc. 2015–14821 Filed 6–16–15; 8:45 am] of the most significant parts of such
change is consistent with the Act.
Comments may be submitted by any of
BILLING CODE 8011–01–P statements.
the following methods:
1 15 U.S.C. 78s(b)(1).
20 15 2 15 U.S.C. 78a.
U.S.C. 78s(b)(3)(A).
21 17 CFR 240.19b–4(f). 22 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4.
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Document Created: 2015-12-15 14:23:08
Document Modified: 2015-12-15 14:23:08
| 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 34753 |
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