80 FR 51342 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the NYSE Arca Equities Schedule of Fees and Charges for Exchange Services To Modify the Credits the Exchange Provides for Routing Certain Orders to the New York Stock Exchange LLC

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 163 (August 24, 2015)

[Federal Register Volume 80, Number 163 (Monday, August 24, 2015)]
[Notices]
[Pages 51342-51343]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-20791]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75722; File No. SR-NYSEARCA-2015-70]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending the NYSE 
Arca Equities Schedule of Fees and Charges for Exchange Services To 
Modify the Credits the Exchange Provides for Routing Certain Orders to 
the New York Stock Exchange LLC

August 18, 2015.
    Pursuant to section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on August 3, 2015, NYSE Arca, Inc. (the ``Exchange'' or 
``NYSE Arca'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the NYSE Arca Equities Schedule of 
Fees and Charges for Exchange Services (``Fee Schedule'') to modify the 
credits the Exchange provides for routing certain orders to the New 
York Stock Exchange LLC (``NYSE''). The text of the proposed rule 
change is available on the Exchange's Web site at www.nyse.com, at the 
principal office of the Exchange, and at the Commission's Public 
Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the Fee Schedule to modify the Tier 
1 and Tier 2 credits the Exchange provides for routing PO+ Orders \4\ 
to the NYSE and make corresponding changes in the Basic Rate pricing.
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    \4\ A PO+ Order is a Primary Only Order (i.e., a market or limit 
order that is to be routed to the primary market) that is entered 
for participation in the primary market, other than for 
participation in the primary market opening or primary market re-
opening. See NYSE Arca Equities Rule 7.31(f)(1)(C).
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    A PO+ Order is designed to route to the primary listing market of 
the security underlying the order (i.e., NYSE, NASDAQ, etc.) 
immediately upon arrival and the order therefore does not rest on the 
Exchange's order book. Because PO+ Orders do not rest on the Exchange's 
book, the Exchange charges fees or provides credits for those orders 
based on the fees or credits of the destination primary listing market, 
which are the fees and credits that the Exchange is charged by the 
primary listing market that receives the order.
    In a recent rule filing, the NYSE modified its fee structure for 
equities transaction by decreasing the level of rebate that it provides 
to its members that provide liquidity from $0.0015 per share to $0.0014 
per share.\5\ In order to maintain the same relationship between the 
rate that the Exchange charges for a PO+ Order and the rebate provided 
by the destination venue, the Exchange is also amending the per share 
credit for PO+ Orders routed to the NYSE that provide liquidity to the 
NYSE to $0.0014 per share. The Exchange proposes corresponding changes 
to the Basic Rate pricing section of the Fee Schedule.
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    \5\ See Securities Exchange Act Release No. 75353 (July 2, 
2015), 80 FR 39468 (July 9, 2015) (SR-NYSE-2015-30).
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    The proposed changes are not otherwise intended to address any 
other issues, and the Exchange is not aware of any problems that ETP 
Holders would have in complying with the proposed changes.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with section 6(b) of the Act,\6\ in general, and furthers the 
objectives of sections 6(b)(4) and (5) of the Act,\7\ in particular, 
because it provides for the equitable allocation of reasonable dues, 
fees, and other charges among its members, issuers and other persons 
using its facilities and does not unfairly discriminate between 
customers, issuers, brokers or dealers.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4) and (5).
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    The Exchange believes that the proposed changes to routing credits 
for PO+ Orders that provide liquidity to the NYSE are reasonable 
because the Exchange's credits for routing an order that does not rest 
on the Exchange's order book, but rather is designed to route to the 
primary listing market on arrival, are closely related to the NYSE's 
rebates for its members for providing liquidity, and the proposed 
change is consistent with the recent change to the NYSE Price List to 
lower its rebate for providing liquidity. While the proposed change 
would result in a decrease in the per share credit for PO+ Orders 
routed to the NYSE that provide liquidity to the NYSE, the rebate that 
the Exchange would provide to ETP Holders is competitive with the rate 
that NYSE provides to its members for providing liquidity and would 
maintain the same relationship between the rebate provide

[[Page 51343]]

by the venue to which the PO+ Order is routed and the fees charged by 
the Exchange for such orders. Further, the proposed change is equitable 
and not unfairly discriminatory because the rebate would apply 
uniformly across pricing tiers and all similarly situated ETP Holders 
would be subject to the same credit.
    Finally, the Exchange believes that it is subject to significant 
competitive forces, as described below in the Exchange's statement 
regarding the burden on competition. For these reasons, the Exchange 
believes that the proposal is consistent with the Act.

B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with section 6(b)(8) of the Act,\8\ the Exchange 
believes that the proposed rule change would not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. In particular, the routing credits would not place 
a burden on competition because the Exchange is maintaining the 
existing relationship between the rebate provided by the Exchange for 
PO+ Order that are routed to the NYSE that provide liquidity on the 
NYSE and the rebate the NYSE provides to its members that provide 
liquidity.\9\
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    \8\ 15 U.S.C. 78f(b)(8).
    \9\ See supra note 5.
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    The Exchange notes that it operates in a highly competitive market 
in which market participants can readily favor competing venues. In 
such an environment, the Exchange must continually review, and consider 
adjusting, its fees and credits to remain competitive with other 
exchanges. For the reasons described above, the Exchange believes that 
this proposal promotes a competitive environment.

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

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

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

    The foregoing rule change is effective upon filing pursuant to 
section 19(b)(3)(A) \10\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \11\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
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    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
section 19(b)(2)(B)\12\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \12\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEARCA-2015-70 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-NYSEARCA-2015-70. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing will also be available 
for inspection and copying at the NYSE's principal office and on its 
Internet Web site at www.nyse.com. All comments received will be posted 
without change; the Commission does not edit personal identifying 
information from submissions. You should submit only information that 
you wish to make available publicly. All submissions should refer to 
File Number SR-NYSEARCA-2015-70 and should be submitted on or before 
September 14, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-20791 Filed 8-21-15; 8:45 am]
BILLING CODE 8011-01-P