80 FR 71871 - Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 221 (November 17, 2015)

Page Range		71871-71873
FR Document		2015-29223
Federal Register, Volume 80 Issue 221 (Tuesday, November 17, 2015)
[Federal Register Volume 80, Number 221 (Tuesday, November 17, 2015)]
[Notices]
[Pages 71871-71873]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-29223]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76419; File No. SR-BATS-2015-99]


Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change Related to 
Fees

November 10, 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 November 2, 2015, BATS Exchange, Inc. (the ``Exchange'' or 
``BATS'') 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\ 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 \5\ and non-members of the Exchange pursuant to 
BATS Rules 15.1(a) and (c) (``Fee Schedule'').
---------------------------------------------------------------------------

    \5\ 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 [sic]. 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.

[[Page 71872]]

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 increase the fee for orders yielding fee 
code D, which results from an order routed to the New York Stock 
Exchange (``NYSE'') using Destination Specific, RDOT, RDOX, TRIM or 
SLIM routing strategy. The Exchange has previously provided a 
discounted fee for certain orders routed to the largest market centers 
measured by volume (NYSE, NYSE Arca and NASDAQ), which, in each 
instance has been $0.0001 less per share for orders routed to such 
market centers by the Exchange than such market centers currently 
charge for removing liquidity (referred to by the Exchange as ``One 
Under'' pricing). NYSE is implementing certain pricing changes 
effective November 2, 2015, including modification from a fee to remove 
liquidity of $0.0027 per share to a fee of $0.00275 per share.\6\ Based 
on the changes in pricing at NYSE, the Exchange is proposing to 
increase its fee for orders executed at NYSE that yield fee code D so 
that the fee remains $0.0001 less per share for orders routed to NYSE. 
Specifically, the Exchange proposes to increase the fee charged for 
such orders from $0.0026 per share to $0.00265 per share.
---------------------------------------------------------------------------

    \6\ See NYSE Trader Update, Fee Changes Effective November 2, 
dated October 30, 2015, available at https://www.nyse.com/publicdocs/nyse/markets/nyse/NYSE_Client_Notice_Fee_Change_11_2015.pdf.
---------------------------------------------------------------------------

    In addition to the change proposed above, the Exchange proposes to 
change certain references on the Fee Schedule in connection with the 
launch of the options exchange operated by the Exchange's affiliate, 
EDGX Exchange, Inc. (``EDGX Options''). First, the Exchange propose 
[sic] to modify references in the Definitions section of the fee 
schedule and Unicast Access section under BATS Connect fees to refer to 
``BZX Options'' instead of ``BATS Options''. Second, the Exchange 
proposes to add reference to EDGX Options in the list of Exchange 
affiliates to which such fees do not apply.
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,\7\ in general, and 
furthers the objectives of Section 6(b)(4),\8\ 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 believes that its proposal to increase the fee 
for Members' orders that yield fee code D from $0.0026 per share to 
$0.00265 per share represents an equitable allocation of reasonable 
dues, fees, and other charges among Members and other persons using its 
facilities in that they are designed to provide a reduced fee for 
orders routed to NYSE through Exchange routing strategies as compared 
to applicable fees for executions if such routed orders were instead 
executed directly by the Member at NYSE. Furthermore, the Exchange 
notes that routing through the Exchange is voluntary. Lastly, the 
Exchange also believes that the proposed amendment is non-
discriminatory because it applies uniformly to all Members. The 
Exchange also believes that the changes to add EDGX Options to the list 
of affiliates under Unicast Access and the re-naming of BATS Options as 
BZX Options is consistent with the Act. Such changes reflect and are in 
connection with the launch of EDGX Options but do not result in any 
material change to the Exchange's Fee Schedule or impose any new or 
different fee.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f.
    \8\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

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

    These proposed rule changes do 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 any of these changes 
represent 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 changes will impair the 
ability of Members or competing venues to maintain their competitive 
standing in the financial markets. The Exchange believes that its 
proposal to charge a fee of $0.00265 per share for Members' orders that 
yield fee code D would increase intermarket competition because it 
offers customers an alternative means to route to NYSE at a discounted 
rate. The Exchange believes that its proposal would not burden 
intramarket competition because the proposed rate would apply uniformly 
to all Members.

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 \9\ and paragraph (f) of Rule 19b-4 
thereunder.\10\ At any time within 60 days of the filing of the 
proposed rule change, the Commission summarily may temporarily suspend 
such rule change if it appears to the Commission that such action is 
necessary or appropriate in the public interest, for the protection of 
investors, or otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 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 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-BATS-2015-99 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange

[[Page 71873]]

Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-BATS-2015-99. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-BATS-2015-99, and should be 
submitted on or before December 8, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-29223 Filed 11-16-15; 8:45 am]
 BILLING CODE 8011-01-P
Federal Register / Vol. 80, No. 221 / Tuesday, November 17, 2015 / Notices 71871

Dated: November 12, 2015. dealer 1 and that the average amount of Dated: November 10, 2015.
Brent J. Fields, time to prepare and file the annual audit Robert W. Errett,
Secretary. report is 100 hours per OTC derivatives Deputy Secretary.
[FR Doc. 2015–29408 Filed 11–13–15; 11:15 am] dealer per year, for a total reporting [FR Doc. 2015–29202 Filed 11–16–15; 8:45 am]
BILLING CODE 8011–01–P
burden of 180 hours per OTC BILLING CODE 8011–01–P
derivatives dealer annually. Thus the
staff estimates that the total industry-
SECURITIES AND EXCHANGE wide reporting burden to comply with SECURITIES AND EXCHANGE
COMMISSION the requirements of Rule 17a–12 is 900 COMMISSION
hours per year (180 × 5). Further, the
Submission for OMB Review; Commission estimates that the total [Release No. 34–76419; File No. SR–BATS–
Comment Request internal compliance cost associated 2015–99]
with this requirement is approximately
Upon Written Request, Copies Available $255,000 per year.2 The average annual Self-Regulatory Organizations; BATS
From: Securities and Exchange reporting cost per broker-dealer for an Exchange, Inc.; Notice of Filing and
Commission, Office of FOIA Services, independent public accountant to Immediate Effectiveness of a Proposed
100 F Street NE., Washington, DC examine the financial statements is Rule Change Related to Fees
20549–2736. approximately $46,300 per broker-
November 10, 2015.
Extension: dealer. Thus, the total industry-wide
Rule 17a–12/Form X–17A–5 Part IIB; SEC annual reporting cost is approximately Pursuant to Section 19(b)(1) of the
File No. 270–442, OMB Control No. $231,500 ($46,300 × 5). Securities Exchange Act of 1934 (the
3235–0498. ‘‘Act’’),1 and Rule 19b–4 thereunder,2
An agency may not conduct or
sponsor, and a person is not required to notice is hereby given that on November
Notice is hereby given that pursuant 2, 2015, BATS Exchange, Inc. (the
to the Paperwork Reduction Act of 1995 respond to, a collection of information
unless it displays a currently valid OMB ‘‘Exchange’’ or ‘‘BATS’’) filed with the
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
Securities and Exchange Commission control number.
(‘‘Commission’’) the proposed rule
(‘‘Commission’’) has submitted to the The public may view background change as described in Items I, II and III
Office of Management and Budget documentation for this information below, which Items have been prepared
(‘‘OMB’’) a request for approval of collection at the following Web site: by the Exchange. The Exchange has
extension of the previously approved www.reginfo.gov. Comments should be designated the proposed rule change as
collection of information provided for in directed to: (i) Desk Officer for the one establishing or changing a member
Rule 17a–12 (17 CFR 240.17a–12) and Securities and Exchange Commission, due, fee, or other charge imposed by the
Part IIB of Form X–17A–5 (17 CFR
Office of Information and Regulatory Exchange under Section 19(b)(3)(A)(ii)
249.617) under the Securities Exchange
Affairs, Office of Management and of the Act 3 and Rule 19b–4(f)(2)
Act of 1934 (15 U.S.C. 78a et seq.).
Budget, Room 10102, New Executive thereunder,4 which renders the
Rule17a–12 requires OTC derivatives Office Building, Washington, DC 20503, proposed rule change effective upon
dealers to file quarterly Financial and or by sending an email to: Shagufta_ filing with the Commission. The
Operational Combined Uniform Single Ahmed@omb.eop.gov; and (ii) Pamela Commission is publishing this notice to
Reports (‘‘FOCUS’’ reports) on Part IIB Dyson, Director/Chief Information solicit comments on the proposed rule
of Form X–17A–5, the basic document Officer, Securities and Exchange change from interested persons.
for reporting the financial and
Commission, c/o Remi Pavlik-Simon, I. Self-Regulatory Organization’s
operational condition of over-the-
100 F Street NE., Washington, DC Statement of the Terms of Substance of
counter (‘‘OTC’’) derivatives dealers.
Rule 17a–12 also requires that OTC 20549, or by sending an email to PRA_ the Proposed Rule Change
derivatives dealers file audited financial Mailbox@sec.gov. Comments must be
statements annually. The reports submitted to OMB within 30 days of The Exchange filed a proposal to
required under Rule 17a–12 provide the this notice. amend its fees and rebates applicable to
Commission with information used to Members 5 and non-members of the
monitor the operations of OTC 1 Based upon an average of 4 responses per year Exchange pursuant to BATS Rules
derivatives dealers and to enforce their and an average of 20 hours spent preparing each 15.1(a) and (c) (‘‘Fee Schedule’’).
response.
compliance with the Commission’s 2 Based on staff experience, an OTC derivatives
The text of the proposed rule change
rules. These reports also enable the is available at the Exchange’s Web site
dealer likely would have a Compliance Manager
Commission to review the business gather the necessary information and prepare and at www.batstrading.com, at the
activities of OTC derivatives dealers and file the quarterly reports and annual audit report principal office of the Exchange, and at
to anticipate, where possible, how these and supporting schedules. According to the the Commission’s Public Reference
dealers may be affected by significant Securities Industry and Financial Markets Room.
economic events. Association Report on Management and
Professional Earnings in the Securities Industry 1 15
There are currently four registered U.S.C. 78s(b)(1).
dated October 2013, which provides base salary and 2 17
OTC derivatives dealers. The staff CFR 240.19b–4.
mstockstill on DSK4VPTVN1PROD with NOTICES

bonus information for middle-management and 3 15 U.S.C. 78s(b)(3)(A)(ii).
expects that one additional firm will professional positions within the securities 4 17 CFR 240.19b–4(f)(2).
register as an OTC derivatives dealer industry, the hourly cost of a compliance manager, 5 The term ‘‘Member’’ is defined as ‘‘any
within the next three years. The staff which the Commission staff has modified to
registered broker or dealer, or any person associated
estimates that the average amount of account for an 1800-hour work year and multiplied with a registered broker or dealer, that has been
by 5.35 to account for bonuses, firm size, employee admitted to membership in the Exchange [sic]. A
time necessary to prepare and file the benefits, and overhead, is approximately $283/hour. Member will have the status of a ‘‘member’’ of the
quarterly reports required by the rule is $283/hour times 900 hours = $254,700, rounded to Exchange as that term is defined in Section 3(a)(3)
eighty hours per OTC derivatives $255,000. of the Act.’’ See Exchange Rule 1.5(n).

VerDate Sep<11>2014 18:14 Nov 16, 2015 Jkt 238001 PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 E:\FR\FM\17NON1.SGM 17NON1
Federal Register / Vol. 80, No. 221 / Tuesday, November 17, 2015 / Notices 71873

Commission, 100 F Street NE., ‘‘Act’’),1 and Rule 19b–4 thereunder,2 A. Self-Regulatory Organization’s
Washington, DC 20549–1090. notice is hereby given that on November Statement of the Purpose of, and
All submissions should refer to File 2, 2015, C2 Options Exchange, Statutory Basis for, the Proposed Rule
Number SR–BATS–2015–99. This file Incorporated (the ‘‘Exchange’’ or ‘‘C2’’) Change
number should be included on the filed with the Securities and Exchange 1. Purpose
subject line if email is used. To help the Commission (the ‘‘Commission’’) the
Commission process and review your The Exchange proposes to amend
proposed rule change as described in
comments more efficiently, please use Interpretation and Policy .07 to Rule 3.4
Items I, II, and III below, which Items
only one method. The Commission will (Qualification and Registration) to
have been prepared by the Exchange. replace the Proprietary Trader (PT)
post all comments on the Commission’s The Commission is publishing this
Internet Web site (http://www.sec.gov/ registration category and qualification
notice to solicit comments on the examination (Series 56) with the
rules/sro.shtml). Copies of the proposed rule change from interested Securities Trader (TD) registration
submission, all subsequent persons. category and qualification examination
amendments, all written statements
I. Self-Regulatory Organization’s (Series 57). In addition, the Exchange
with respect to the proposed rule
Statement of the Terms of Substance of proposes to replace the Proprietary
change that are filed with the
the Proposed Rule Change Trader Principal (TP) registration
Commission, and all written
category with a Securities Trader
communications relating to the
The Exchange proposes to amend Principal (TP) registration category for
proposed rule change between the
Interpretation and Policy .07 to Rule 3.4 individual TPHs or associated person
Commission and any person, other than
(Qualification and Registration) [sic] who either: (i) Supervise or
those that may be withheld from the
regarding the categories of registration monitor proprietary trading, market-
public in accordance with the
and respective qualification making and/or brokerage activities for
provisions of 5 U.S.C. 552, will be
examinations required for individual broker-dealers; (ii) supervise or train
available for Web site viewing and
Permit Holder [sic] and associated those engaged in proprietary trading,
printing in the Commission’s Public
persons of Permit Holders that engage in market-making and/or effecting
Reference Room, 100 F Street NE.,
transactions on behalf of a broker-
Washington, DC 20549, on official the securities activities of the Permit
dealer, with respect to those activities;
business days between the hours of Holder on the Exchange. Specifically,
and/or (iii) are officers, partners or
10:00 a.m. and 3:00 p.m. Copies of the the Exchange proposes to replace the directors of a Permit Holder, as
filing also will be available for Proprietary Trader registration category described in paragraph (a)(2) of
inspection and copying at the principal and the Series 56 Proprietary Trader Interpretation and Policy .07 to Rule 3.4.
office of the Exchange. All comments registration qualification examination The Exchange also proposes to replace
received will be posted without change; for Proprietary Traders with the the Proprietary Trader Compliance
the Commission does not edit personal Securities Trader category of registration Officer (CT) registration category with
identifying information from and the Series 57 Securities Trader the Securities Trader Compliance
submissions. You should submit only registration qualification examination Officer (CT) registration category for
information that you wish to make for Securities Traders respectively. The Chief Compliance Officers (or
available publicly. All submissions text of the proposed rule change is individuals performing similar
should refer to File Number SR–BATS–
available on the Exchange’s Web site functions) of a TPH or TPH
2015–99, and should be submitted on or
(http://www.cboe.com/AboutCBOE/ organization. This filing is, in all
before December 8, 2015.
CBOELegalRegulatoryHome.aspx), at material respects, based upon SR–
For the Commission, by the Division of the Exchange’s Office of the Secretary, FINRA–2015–017, which was recently
Trading and Markets, pursuant to delegated approved by the Securities and
and at the Commission’s Public
authority.11 Exchange Commission (‘‘SEC’’ or
Reference Room.
Robert W. Errett, ‘‘Commission’’).3
Deputy Secretary. II. Self-Regulatory Organization’s Rule 3.4 sets forth various
[FR Doc. 2015–29223 Filed 11–16–15; 8:45 am] Statement of the Purpose of, and qualification and registration
BILLING CODE 8011–01–P Statutory Basis for, the Proposed Rule requirements that individual Permit
Change Holders and associated persons must
satisfy in order to transact business on
SECURITIES AND EXCHANGE In its filing with the Commission, the the Exchange. Among the qualification
COMMISSION Exchange included statements and registration requirements set forth
concerning the purpose of and basis for in Rule 3.4, Interpretation and Policy
[Release No. 34–76408; File No. SR–C2– the proposed rule change and discussed .07 provides that individual Permit
2015–027] any comments it received on the Holders and associated persons that
proposed rule change. The text of these engage in proprietary trading, market-
Self-Regulatory Organizations; C2 statements may be examined at the making, or effect transactions on behalf
Options Exchange, Incorporated; places specified in Item IV below. The of a broker-dealer must register and
Notice of Filing and Immediate Exchange has prepared summaries, set qualify as a Proprietary Trader (TP) in
Effectiveness of a Proposed Rule forth in sections A, B, and C below, of WebCRD.4 To qualify as a Proprietary
mstockstill on DSK4VPTVN1PROD with NOTICES

Change Relating to Qualification and the most significant aspects of such
Registration of Permit Holders statements. 3 See Securities Exchange Act Release No. 75783

(August 28, 2015) (Order Approving a Proposed
November 10, 2015. Rule Change To Establish the Securities Trader and
Pursuant to Section 19(b)(1) of the Securities Trader Principal Registration Categories)
(SR–FINRA–2015–017).
Securities Exchange Act of 1934 (the 4 WebCRD is a secure registration and licensing
1 15 U.S.C. 78s(b)(1). system operated by FINRA and is the central
11 17 CFR 200.30–3(a)(12). 2 17 CFR 240.19b–4. Continued

VerDate Sep<11>2014 18:14 Nov 16, 2015 Jkt 238001 PO 00000 Frm 00104 Fmt 4703 Sfmt 4703 E:\FR\FM\17NON1.SGM 17NON1
Document Created: 2015-12-14 14:01:06
Document Modified: 2015-12-14 14:01:06
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 71871