81 FR 54873 - Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Related to Transaction and Regulatory Fees
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 159 (August 17, 2016)
Federal Register Volume 81, Issue 159 (August 17, 2016)
| Page Range | 54873-54877 | |
| FR Document | 2016-19581 |
[Federal Register Volume 81, Number 159 (Wednesday, August 17, 2016)] [Notices] [Pages 54873-54877] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-19581] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-78550; File No. SR-IEX-2016-09] Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Related to Transaction and Regulatory Fees August 11, 2016. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (``Act''),\2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, on August 5, 2016, the Investors Exchange LLC (``IEX'' or the ``Exchange'') 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 self-regulatory organization. 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\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change Pursuant to the provisions of Section 19(b)(1) under the Securities Exchange Act of 1934 (``Act''),\4\ and Rule 19b-4 thereunder,\5\ Investors Exchange LLC (``IEX'' or ``Exchange'') is filing with the Securities and Exchange Commission (``Commission'') a proposed rule change to (i) adopt transaction fees applicable to Members \6\ of the Exchange pursuant to IEX Rule 15.110(a) and (c) (``Fee Schedule''), and (ii) adopt regulatory fees related to the Central Registration Depository (``CRD system''), which will be collected by the Financial Industry Regulatory Authority, Inc. (``FINRA'') pursuant to IEX Rule 15.110(a). The Exchange proposes to implement the rule change effective with its exchange launch. The text of the proposed rule change is available at the Exchange's Web site at www.iextrading.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. --------------------------------------------------------------------------- \4\ 15 U.S.C. 78s(b)(1). \5\ 17 CRF [sic] 240.19b-4. \6\ See, IEX Rule 1.160(s). --------------------------------------------------------------------------- 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 these statement [sic] may be examined at the places specified in Item IV below. The self-regulatory organization has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose Transaction Fees The Exchange proposes to implement a fee schedule applicable to use of the Exchange commencing on the date it begins operating as a national securities exchange. The Exchange currently intends to commence operations as a national securities exchange on or about August 19, 2016. IEX proposes to implement the Fee Schedule described herein, which will be applicable to transactions executed in all trading sessions, effective with its exchange launch. (A) Displayed Match Fee The Exchange does not propose to charge any fee to Members for executions on IEX that include resting interest with displayed priority (i.e., an order or portion of a reserve order that is booked and ranked with display priority on the Order Book either as the IEX best bid or best offer (``BBO'') or at a worse price on the Order Book) for both the liquidity adding and liquidity removing order.\7\ --------------------------------------------------------------------------- \7\ This pricing is referred to by the Exchange as ``Displayed Match Fee'' on the proposed Fee Schedule with a Fee Code of `L' to be provided by the Exchange on execution reports. --------------------------------------------------------------------------- (B) Non-Displayed Match Fee The Exchange proposes to charge $0.0009 per share (or 0.30% of the total dollar value of the transaction for securities priced below $1.00) to Members for executions on IEX that include resting interest with non-displayed priority (i.e., an order or portion of a reserve order that is booked and ranked with non-display priority on the Order Book either at the NBBO midpoint or at a worse price on the Order Book) for both the liquidity adding and liquidity removing order,\8\ with the exception of executions on the Exchange where the adding and removing order originated from the same Exchange Member and displayable orders removing non-displayed liquidity upon entry, each as described below. --------------------------------------------------------------------------- \8\ This pricing is referred to by the Exchange as ``Non- Displayed Match Fee'' on the proposed Fee Schedule with a Fee Code of `I' to be provided by the Exchange on execution reports. --------------------------------------------------------------------------- Notwithstanding the foregoing, the Exchange does not propose to charge any fee to Members for executions on IEX that involve taking resting interest with non-displayed priority where (a) the liquidity removing order was displayable (i.e., the order would have booked and displayed if posted to the Order Book) and (b) on a monthly basis, at least 90% of the liquidity removing Member's aggregate executions of displayable orders added liquidity during such calendar month. However, in such transactions, the non-displayed liquidity adding interest will be subject to the Non-Displayed Match Fee described above. (C) Internalization Fee The Exchange does not propose to charge any fee to Members for executions on IEX when the adding and removing order originated from the same Exchange Member.\9\ Orders from different market participant identifiers of the same broker dealer, with the same Central Registration Depository registration number, would be treated as originating from the same Exchange Member. --------------------------------------------------------------------------- \9\ This pricing is referred to by the Exchange as ``Internalization Fee'' on the proposed Fee Schedule with a Fee Code of `S' to be provided by the Exchange on execution reports. --------------------------------------------------------------------------- (D) Routing Charges The Exchange proposes to pass the fee or rebate from an away trading center to the Member and charge a fee of $0.0001 per share for all routing options offered by the Exchange. All charges for routing are applicable only in the event that an [[Page 54874]] order is executed on an away trading center.\10\ --------------------------------------------------------------------------- \10\ The Exchange will provide the Fee Code from away market centers on execution reports of routed transactions. In the proposed Fee Schedule, the Fee Code of ``Alpha'' is used to indicate this behavior. --------------------------------------------------------------------------- (E) Other Fees The Exchange does not propose to charge fees for membership, connectivity port fees, or market data. Regulatory Fees IEX is proposing to adopt certain regulatory fees under Rule 15.110(a) related to the CRD system, which are collected by FINRA.\11\ As proposed, FINRA will collect and retain certain regulatory fees via the CRD system for the registration of persons associated with an Exchange Members [sic] that are not also FINRA members. The CRD system fees are use-based and there is no distinction in the cost incurred by FINRA if the user is a FINRA member or a member of an exchange but not a FINRA member. Accordingly, IEX is proposing to adopt the fees under IEX Rule 15.110(a) to mirror those assessed by FINRA pursuant to Section (4) of Schedule A to the FINRA By-Laws. As proposed, the fees are as follows: \12\ --------------------------------------------------------------------------- \11\ The CRD system is the central licensing and registration system for the U.S. securities industry. The CRD system enables individuals and firms seeking registration with multiple states and self-regulatory organizations to do so by submitting a single form, fingerprint card and a combined payment of fees to FINRA. Through the CRD system, FINRA maintains the qualification, employment and disciplinary histories of registered associated persons of broker dealers. \12\ The Exchange has only adopted the CRD system fees charged by FINRA to Non-FINRA Members when such fees are applicable. In this regard, certain FINRA CRD system fees and requirements are specific to FINRA members, but do not apply to IEX Members that are not also FINRA members. IEX Members that are also FINRA members are charged CRD system fees according to Section (4) of Schedule A to the FINRA By-Laws. (1) $100 for each initial Form U4 filed for the registration of a representative or principal; (2) $110 for the additional processing of each initial or amended Form U4, Form U5 or Form BD that includes the initial reporting, amendment, or certification of one or more disclosure events or proceedings; (3) $45 annual for each of the Member's registered representatives and principals for system processing; (4) $15 for processing and posting to the CRD system each set of fingerprint cards submitted electronically by the Member, plus a pass-through of any other charge imposed by the United States Department of Justice for processing each set of fingerprints; (5) $30 for processing and posting to the CRD system each set of fingerprint cards submitted in non-electronic format by the Member, plus a pass-through of any other charge imposed by the United States Department of Justice for processing each set of fingerprints; and (6) $30 for processing and posting to the CRD system each set of fingerprint results and identifying information that has been processed through a self-regulatory organization other than FINRA. 2. Statutory Basis Transaction Fees IEX believes that the proposed rule change is consistent with the provisions of Section 6(b) \13\ of the Act in general, and furthers the objectives of Sections [sic] 6(b)(4) \14\ of the Act, in particular, in that 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. Additionally, IEX believes that the proposed fees are consistent with the investor protection objectives of Section 6(b)(5) \15\ of the Act in particular in that they are designed to promote just and equitable principles of trade, to remove impediments to a free and open market and national market system, and in general to protect investors and the public interest. --------------------------------------------------------------------------- \13\ 15 U.S.C. 78f. \14\ 15 U.S.C. 78f(b)(4). \15\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The proposed Fee Schedule set forth herein is designed to minimize incentives for trading and order routing decisions based solely on rebates that could create conflicts of interest by skewing economic incentives related to such decisions. In addition, by not offering rebates, IEX has simplified its order type offering to avoid order types designed to assure receipt of a rebate.\16\ By contrast, as proposed, IEX will charge relatively low fees for all executed shares, and which will be significantly lower than many other exchange fees charged for removing (or taking) liquidity.\17\ Moreover, IEX believes that adders of liquidity can be incentivized to rest shares by offering a market model and order types designed to protect their interests as opposed to the payment of a rebate. --------------------------------------------------------------------------- \16\ In an address on equity market structure on June 5, 2014, Chair Mary Jo White called upon the exchanges to conduct a comprehensive review of their order types and how they operate, as well as to ``consider appropriate rule changes to help clarify the nature of their order types and how they interact with each other, and how they support fair, orderly, and efficient markets.'' (See, speech by Chair Mary Jo White at Sandler O'Neill & Partners, L.P. Global Exchange and Brokerage Conference, New York, N.Y., available at http://www.sec.gov/News/Speech/Detail/Speech/1370542004312) \17\ For example, the New York Stock Exchange trading fee schedule on its public Web site reflects fees to ``take'' liquidity ranging from $0.0024-$0.00275 depending on the type of market participant, order and execution (See, https://www.nyse.com/markets/nyse/trading-info/fees). The Nasdaq Stock Market (``Nasdaq'') trading fee schedule on its public Web site reflects fees to ``remove'' liquidity ranging from $0.0030 per share for shares executed at or above $1.00 or 0.30% of total dollar volume for shares executed below $1.00 (See, http://nasdaqtrader.com/Trader.aspx?id=PriceListTrading2). BATS BZX Exchange (``BZX) trading fee schedule on its public Web site reflects fees for ``removing'' liquidity ranging from $0.0030 for shares executed at or above $1.00 or 0.30% of total dollar volume for shares executed below $1.00, subject to certain limited exceptions for orders trading in the opening, IPO or halt auctions BZX listed securities (See, https://www.batstrading.com/support/fee_schedule/bzx/). --------------------------------------------------------------------------- IEX believes that it is appropriate, reasonable and consistent with the Act, to charge the $0.0009 per share Non-Displayed Match Fee, because it is within the transaction fee range charged by other exchanges.\18\ IEX also believes that it is appropriate, reasonable and consistent with the Act, not to charge a fee for transactions that include execution of an order with displayed priority on the Order Book. This fee structure is designed to incentivize Members to send IEX aggressively priced displayable orders, thereby contributing to price discovery and consistent with the overall goal of enhancing market quality. IEX believes that not charging a fee for both the liquidity adder and remover is equitable and not unfairly discriminatory because it is designed to facilitate execution of, and enhance trading opportunities for, displayable orders, thereby further incentivizing entry of displayed orders. --------------------------------------------------------------------------- \18\ Id. --------------------------------------------------------------------------- In addition, the Exchange believes that it is appropriate, and consistent with the Act, to not charge a fee to Members with respect to displayable orders that remove non-displayed liquidity upon entry so long as at least 90% of the Member's aggregate executed shares of displayable orders added liquidity during the month in question. This flexibility is designed to address limited inadvertent liquidity removal for Exchange Members who are largely adding displayed liquidity. Under these circumstances, the Member generally intends to add displayed liquidity on IEX, and the Exchange therefore believes that it is appropriate to provide a fee incentive to such order, subject to the 90% limitation described herein, to further encourage aggressively priced displayed orders. The Exchange also believes that it is appropriate, reasonable and consistent with the Act, to charge the $0.0009 per share Non-Displayed Match Fee to Members for the resting, non-displayed order that matches with the displayable order under such circumstances because the reduced fee for Members entering displayable orders removing non-displayed liquidity is a narrowly drawn incentive to address unintended [[Page 54875]] consequences. Accordingly, the Exchange believes that it is appropriate to charge the $0.0009 per share Non-Displayed Match Fee for such orders. The Exchange also notes that most other national securities exchanges charge different fees to members for adding and removing liquidity, and that this aspect of IEX's proposed Fee Schedule does not raise any new or novel issues that have not previously been considered by the Commission in connection with the fees of other national securities exchanges.\19\ --------------------------------------------------------------------------- \19\ See, for example https://www.nyse.com/markets/nyse/trading-info/fees, http://nasdaqtrader.com/Trader.aspx?id=PriceListTrading2, and https://www.batstrading.com/support/fee_schedule/bzx/). --------------------------------------------------------------------------- With respect to internalized trades, the proposal to charge no fee is designed to incentivize Members (and their customers) to send orders to IEX that may otherwise be internalized off exchange. As broker operated ATSs and internalization mechanisms have proliferated to account for nearly 40% of trading volume,\20\ natural investor trading interest has become increasingly dispersed across these venues, while the overall trading volume on regulated exchanges has declined.\21\ IEX believes that one of the factors driving broker decisions to trade away from regulated exchanges has been exchange access fees. Accordingly, this fee structure is designed with the goal to increase resultant order interaction on IEX. In this regard, IEX believes that increased liquidity on IEX would have several benefits to investors in securities traded on IEX. First, it would increase opportunities for investors' orders to interact directly, thereby concurrently reducing the need for unnecessary intermediation and the associated implicit costs, including potential information leakage and gaming. Second, to the extent Exchange Members post more displayed orders on IEX, price discovery would be enhanced drawing more natural trading interest to the public markets which would deepen liquidity and dampen the impact of shocks from liquidity demand. Third, orders executed on IEX rather than being internalized on broker-operated platforms, will have the benefit of exchange transparency, regulation, and oversight. Additionally, because IEX prices orders based on direct market data feeds of protected markets,\22\ the quality of executions on IEX may be enhanced compared to orders that are internalized on certain broker-operated platforms that price orders based on SIP market data feeds. --------------------------------------------------------------------------- \20\ See, for example, BATS Market Volume Summary for June 14, 2016 available at http://batstrading.com/market_summary/. \21\ See, for example a speech by former Commissioner Luis A. Aguilar on May 11, 2015 entitled ``U.S. Equity Market Structure: Making Our Markets Work Better for Investors'' (available at http://www.sec.gov/news/statement/us-equity-market-structure.html#_ednref1), and speech by Commission Chair Mary Jo White on June 5, 2014 entitled ``Enhancing our Equity Market Structure'' (available at http://www.sec.gov/News/Speech/Detail/Speech/1370542004312#_ednref17). \22\ See IEX Rule 11.410(a)(2)-(4), which describes IEX's use of proprietary market data feeds and those of the Securities Information Processors. --------------------------------------------------------------------------- It is important to note that orders entered by the same broker (that by their terms could be executable against each other) are not guaranteed to be matched against each other, and each order is individually at market risk for execution against contra-side orders from other Members. Moreover, Members sending orders eligible for this fee structure are subject to all existing IEX and FINRA rules applicable to customer orders, including without limitation those pertaining to wash sales, best execution, and customer priority. (See for example, Chapter 10 of the IEX Rules and FINRA Rules 5210, 5310 and 5320). Moreover, IEX believes that there are precedents for exchanges to charge fees that distinguish between different types of members to incentivize certain types of members. These fee structures may discriminate in favor of certain types of members but not in an unfairly discriminatory manner in violation of the Act. In this regard, most other exchanges offer reduced fees to members that reach certain volume based tiers. Such fee structures, while nominally available to all members, are targeted to incentivize larger members with enough volume to reach the volume-based tiers. For example, the NYSE fee schedule provides rebates of up to $0.0022 per share for members generally that provide greater than 1.10% of consolidated average trading volume compared to no rebate for firms that do not reach specified volume tiers. And NYSE floor brokers, which have no unique obligations to the market, receive higher rebates at certain volume levels, as well as lower take fees, compared to NYSE member firms generally.\23\ --------------------------------------------------------------------------- \23\ See, https://www.nyse.com/markets/nyse/trading-info/fees. --------------------------------------------------------------------------- Similarly, the IEX fee structure is designed to incentivize Members to send orders to a regulated exchange and enable IEX to compete more effectively with internalizers and dark pools that provide internalized matching. Notwithstanding that IEX will not pay for order flow, the Exchange believes that some Members may nonetheless choose to direct order flow to IEX as a regulated exchange in order to benefit from real-time reporting and regulatory oversight, and that not charging a fee will help IEX to compete for such order flow. The Exchange does not believe that this fee incentive is unfairly discriminatory because it is available to any IEX Member, consistent with applicable FINRA and IEX rules, and potentially benefits all members because the fee incentive may result in increased order flow and liquidity in IEX. As noted above, internalization on IEX is not guaranteed, and the additional order flow that does not internalize is available to trade by all Members, and would enhance price discovery if such order flow results in more displayed orders. Trading on the IEX alternative trading system (``ATS'') directly supports the Exchange's contention that the proposed pricing structure will provide benefits to Members generally and is not unfairly discriminatory. IEX has offered comparable pricing on its ATS. Between January 1, 2016 and June 30, 2016, internalized transactions occurred across 66 of 145 ATS subscribers with a range of business models (e.g., full service, agency, and retail broker-dealers).\24\ During the period January 1, 2016 through June 30, 2016, approximately 454 million shares internalized on the IEX ATS. For those transactions on the IEX ATS that included self-matched volume, the liquidity removing orders also executed against approximately 63 million resting shares of other subscribers.\25\ Thus, IEX does not believe that the internalization fee incentive has had an unfairly discriminatory impact in practice, since internalized transactions occurred across a large number of different types of subscribers, providing collateral liquidity benefits to other subscribers. --------------------------------------------------------------------------- \24\ Between January 1, 2016 and June 30, 2016, only 2.97 percent of overall subscribers' volume was from internalized transactions. \25\ During the same period, there were also approximately 578 million unexecuted shares from the incoming orders that self- matched. --------------------------------------------------------------------------- Additionally, the Exchange believes that its proposed fee codes, to be provided on execution and routing reports, will provide transparency and predictability to Members as to applicable transaction fees. In this regard, IEX notes that Members will be able to maintain a tally of executions of displayable orders eligible for no fee for taking non- displayed liquidity by calculating, on a monthly basis, whether the proportion of their executed displayable orders that added liquidity is 90% or more of their total monthly volume of executed displayable orders. Using IEX execution reports, Members [[Page 54876]] can calculate whether the sum of executions with Fee Code L and a Last Liquidity Indicator (FIX tag 851) of `1' (Added Liquidity), divided by the sum of executions with Fee Code L is at least 90%. In summary, IEX believes that the proposed fee structure for internalized transactions is reasonable, fair and equitable, and not an unfairly discriminatory allocation of fees because it will provide all Members with incentives not to avoid sending orders to IEX that will contribute to enhanced liquidity and price discovery on a regulated exchange. While not all Members necessarily will have the ability to directly benefit from the proposed fee structure for internalized transactions, as noted above internalization is not guaranteed so IEX believes that Members generally may indirectly benefit from an increase in order flow that does not internalize on IEX, as has been the case on the ATS. With respect to orders routed to other exchanges, the proposal to pass through fees charged by such other away trading centers for executed shares plus charge a fee of $0.0001 payable to IEX is a reasonable, fair and equitable, and not an unfairly discriminatory allocation of fees because the fee is applicable to all Members in an equivalent manner. The $0.0001 fee payable to IEX is not inconsistent with the fees charged by other exchanges for routed orders, since many of their routing fees are variable based on the fees and rebates charged by such other venues.\26\ Accordingly, the IEX proposed approach raises no new or novel issues. --------------------------------------------------------------------------- \26\ See, for example, Nasdaq Stock Market Rule 7018(a)(1). --------------------------------------------------------------------------- As described more fully below in the Exchange's statement regarding the burden on competition, the Exchange believes that it is subject to significant competitive forces, and that its proposed fee structure is an appropriate effort to address such forces. IEX also believes that not charging a fee for membership, connectivity or market data is reasonable because it may incentivize broker-dealers to become members of the Exchange and to therefore direct order flow to IEX. As a new exchange, IEX will operate in a highly competitive environment, and not charging fees for such services and access is designed to enable it to compete effectively. In conclusion, the Exchange also submits that its proposed fee structure satisfies the requirements of Sections 6(b)(4) and 6(b)(5) of the Act for the reasons discussed above in that it does not permit unfair discrimination between customers, issuers, brokers, or dealers, and is designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system. For the foregoing reasons, the Exchange believes that its simplified fee structure is consistent with the Act, in that it is designed to promote just and equitable principles of trade, to remove impediments to a free and open market and national market system and in general to protect investors and the public interest. Regulatory Fees IEX believes that the proposed rule change is consistent with the provisions of Section 6(b) \27\ of the Act in general, and furthers the objectives of Section 6(b)(4) \28\ of the Act, in particular, in that it provides for the equitable allocation of reasonable fees and other charges among its members, and does not unfairly discriminate between customers, issuers, brokers and dealers. All similarly situated Members are subject to the same fee structure, and every Member firm must use the CRD system for registration and disclosure. --------------------------------------------------------------------------- \27\ 15 U.S.C. 78f. \28\ 15 U.S.C. 78f(b)(4). --------------------------------------------------------------------------- The proposed fees are reasonable because they are identical to those adopted by FINRA for use of the CRD system for disclosure and the registration of associated persons of FINRA members.\29\ As FINRA noted in its filing adopting its existing fees, it believes the fees are reasonable based on the increased costs associated with operating and maintaining the CRD system, and listed a number of enhancements made to the CRD system since the last fee increase, including: (1) Incorporation of various uniform registration form changes; (2) electronic fingerprint processing; (3) Web EFTTM, which allows subscribing firms to submit batch filings to the CRD system; (4) increases in the number and types of reports available through the CRD system; and (5) significant changes to BrokerCheck, including making BrokerCheck easier to use and expanding the amount of information made available through the system.\30\ These increased costs are similarly borne by FINRA when a member of IEX that is not a member of FINRA uses the CRD system, so the fees collected for such use should mirror the fees assessed on FINRA members, as is proposed by IEX. FINRA further noted its belief that the proposed fees are reasonable because they help to ensure the integrity of the information in the CRD system, which is important because the Commission, FINRA, other self-regulatory organizations and state securities regulators use the CRD system to make licensing and registration decisions, among other things.\31\ --------------------------------------------------------------------------- \29\ See Securities Exchange Act Release No. 67247 (June 25, 2012), 77 FR 38866 (June 29, 2012) (SR-FINRA-2012-30). \30\ See supra, note 27 [sic], at 77 FR 38866, 38868. \31\ See supra [sic], at 77 FR 38866, 38868. --------------------------------------------------------------------------- The Exchange also believes that the proposed fees, like FINRA's fees, are consistent with an equitable allocation of fees because the fees will apply equally to all individuals and members required to report information to the CRD system. Thus, those members that register more individuals or submit more filings through the CRD system will generally pay more in fees than those members that use the CRD system to a lesser extent. In addition, the proposed fees, like FINRA's fees, are equitable and not unfairly discriminatory because they will result in the same regulatory fees being charged to all IEX Members required to report information to the CRD system and for services performed by FINRA, regardless of whether or not such Member is a FINRA member. B. Self-Regulatory Organization's Statement on Burden on Competition Transaction Fees IEX 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. The Exchange does not believe that the proposed rule change will impose any burden on intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act. To the contrary, the Exchange believes that the proposed pricing structure will increase competition and hopefully draw additional volume to the Exchange. The Exchange will operate in a highly competitive market in which market participants can readily favor competing venues if fee schedules at other venues are viewed as more favorable. As a new exchange, IEX expects to face intense competition from existing exchanges and other non-exchange venues that provide markets for equities trading. Consequently, the Exchange believes that the degree to which IEX fees could impose any burden on competition is extremely limited, and does not believe that such fees would burden competition of Members or competing venues in a manner that is not necessary or appropriate in furtherance of the purposes of the Act. [[Page 54877]] The Exchange does not believe that the proposed rule change will impose any burden on intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because, while different fees are assessed in some circumstances, these different fees are not based on the type of Member entering the orders that match but on the type of order entered and all Members can submit any type of order. Further, the proposed fees are intended to encourage market participants to bring increased volume to the Exchange, which benefits all market participants. Regulatory Fees IEX 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. Specifically, the Exchange believes that the proposed fees will result in the same regulatory fees being charged to all Members required to report information to the CRD system and for services performed by FINRA, regardless of whether or not such Members are FINRA members. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act \32\ and paragraph (f) of Rule 19b-4 \33\ thereunder. 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. --------------------------------------------------------------------------- \32\ 15 U.S.C. 78s(b)(3)(A). \33\ 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-IEX-2016-09 on the subject line. Paper Comments Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-IEX-2016-09. 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-IEX-2016-09, and should be submitted on or before September 7, 2016. --------------------------------------------------------------------------- \34\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\34\ Robert W. Errett, Deputy Secretary. [FR Doc. 2016-19581 Filed 8-16-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 159 / Wednesday, August 17, 2016 / Notices 54873
inspection and copying at the principal fees related to the Central Registration (B) Non-Displayed Match Fee
office of the Exchange. All comments Depository (‘‘CRD system’’), which will
received will be posted without change; be collected by the Financial Industry The Exchange proposes to charge
the Commission does not edit personal Regulatory Authority, Inc. (‘‘FINRA’’) $0.0009 per share (or 0.30% of the total
identifying information from pursuant to IEX Rule 15.110(a). The dollar value of the transaction for
submissions. You should submit only Exchange proposes to implement the securities priced below $1.00) to
information that you wish to make rule change effective with its exchange Members for executions on IEX that
available publicly. All submissions launch. The text of the proposed rule include resting interest with non-
should refer to File Number SR–CBOE– change is available at the Exchange’s displayed priority (i.e., an order or
2016–059 and should be submitted on Web site at www.iextrading.com, at the portion of a reserve order that is booked
or before September 7, 2016. principal office of the Exchange, and at and ranked with non-display priority on
For the Commission, by the Division of
the Commission’s Public Reference the Order Book either at the NBBO
Trading and Markets, pursuant to delegated Room. midpoint or at a worse price on the
authority.22 II. Self-Regulatory Organization’s Order Book) for both the liquidity
Robert W. Errett, Statement of the Purpose of, and adding and liquidity removing order,8
Deputy Secretary. Statutory Basis for, the Proposed Rule with the exception of executions on the
[FR Doc. 2016–19584 Filed 8–16–16; 8:45 am] Change Exchange where the adding and
removing order originated from the
BILLING CODE 8011–01–P In its filing with the Commission, the same Exchange Member and displayable
self-regulatory organization included orders removing non-displayed liquidity
statements concerning the purpose of upon entry, each as described below.
SECURITIES AND EXCHANGE and basis for the proposed rule change
COMMISSION and discussed any comments it received Notwithstanding the foregoing, the
[Release No. 34–78550; File No. SR–IEX– on the proposed rule change. The text Exchange does not propose to charge
2016–09] of these statement [sic] may be any fee to Members for executions on
examined at the places specified in Item IEX that involve taking resting interest
Self-Regulatory Organizations; IV below. The self-regulatory with non-displayed priority where (a)
Investors Exchange LLC; Notice of organization has prepared summaries, the liquidity removing order was
Filing and Immediate Effectiveness of set forth in Sections A, B, and C below, displayable (i.e., the order would have
Proposed Rule Change Related to of the most significant aspects of such booked and displayed if posted to the
Transaction and Regulatory Fees statements. Order Book) and (b) on a monthly basis,
August 11, 2016. A. Self-Regulatory Organization’s at least 90% of the liquidity removing
Pursuant to Section 19(b)(1) 1 of the Statement of the Purpose of, and the Member’s aggregate executions of
Securities Exchange Act of 1934 Statutory Basis for, the Proposed Rule displayable orders added liquidity
(‘‘Act’’),2 and Rule 19b–4 thereunder,3 Change during such calendar month. However,
notice is hereby given that, on August in such transactions, the non-displayed
1. Purpose liquidity adding interest will be subject
5, 2016, the Investors Exchange LLC
(‘‘IEX’’ or the ‘‘Exchange’’) filed with the Transaction Fees to the Non-Displayed Match Fee
Securities and Exchange Commission described above.
The Exchange proposes to implement
(‘‘Commission’’) the proposed rule a fee schedule applicable to use of the (C) Internalization Fee
change as described in Items I, II and III Exchange commencing on the date it
below, which Items have been prepared begins operating as a national securities The Exchange does not propose to
by the self-regulatory organization. The exchange. The Exchange currently charge any fee to Members for
Commission is publishing this notice to intends to commence operations as a executions on IEX when the adding and
solicit comments on the proposed rule national securities exchange on or about removing order originated from the
change from interested persons. August 19, 2016. IEX proposes to same Exchange Member.9 Orders from
implement the Fee Schedule described different market participant identifiers
I. Self-Regulatory Organization’s
herein, which will be applicable to of the same broker dealer, with the same
Statement of the Terms of Substance of
transactions executed in all trading Central Registration Depository
the Proposed Rule Change
sessions, effective with its exchange registration number, would be treated as
Pursuant to the provisions of Section launch. originating from the same Exchange
19(b)(1) under the Securities Exchange Member.
Act of 1934 (‘‘Act’’),4 and Rule 19b–4 (A) Displayed Match Fee
thereunder,5 Investors Exchange LLC The Exchange does not propose to (D) Routing Charges
(‘‘IEX’’ or ‘‘Exchange’’) is filing with the charge any fee to Members for
The Exchange proposes to pass the fee
Securities and Exchange Commission executions on IEX that include resting
or rebate from an away trading center to
(‘‘Commission’’) a proposed rule change interest with displayed priority (i.e., an
the Member and charge a fee of $0.0001
to (i) adopt transaction fees applicable order or portion of a reserve order that
per share for all routing options offered
to Members 6 of the Exchange pursuant is booked and ranked with display
by the Exchange. All charges for routing
to IEX Rule 15.110(a) and (c) (‘‘Fee priority on the Order Book either as the
IEX best bid or best offer (‘‘BBO’’) or at are applicable only in the event that an
Schedule’’), and (ii) adopt regulatory
mstockstill on DSK3G9T082PROD with NOTICES
a worse price on the Order Book) for
8 This pricing is referred to by the Exchange as
22 17 CFR 200.30–3(a)(12). both the liquidity adding and liquidity ‘‘Non-Displayed Match Fee’’ on the proposed Fee
1 15 U.S.C. 78s(b)(1). removing order.7 Schedule with a Fee Code of ‘I’ to be provided by
2 15 U.S.C. 78a.
the Exchange on execution reports.
3 17 CFR 240.19b–4.
7 This pricing is referred to by the Exchange as 9 This pricing is referred to by the Exchange as
4 15 U.S.C. 78s(b)(1).
‘‘Displayed Match Fee’’ on the proposed Fee ‘‘Internalization Fee’’ on the proposed Fee Schedule
5 17 CRF [sic] 240.19b–4.
Schedule with a Fee Code of ‘L’ to be provided by with a Fee Code of ‘S’ to be provided by the
6 See, IEX Rule 1.160(s). the Exchange on execution reports. Exchange on execution reports.
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![54874 Federal Register / Vol. 81, No. 159 / Wednesday, August 17, 2016 / Notices
order is executed on an away trading (6) $30 for processing and posting to the believes that adders of liquidity can be
center.10 CRD system each set of fingerprint results incentivized to rest shares by offering a
and identifying information that has been market model and order types designed
(E) Other Fees processed through a self-regulatory
organization other than FINRA.
to protect their interests as opposed to
The Exchange does not propose to the payment of a rebate.
charge fees for membership, IEX believes that it is appropriate,
2. Statutory Basis
connectivity port fees, or market data. reasonable and consistent with the Act,
Transaction Fees to charge the $0.0009 per share Non-
Regulatory Fees
IEX believes that the proposed rule Displayed Match Fee, because it is
IEX is proposing to adopt certain change is consistent with the provisions within the transaction fee range charged
regulatory fees under Rule 15.110(a) of Section 6(b) 13 of the Act in general, by other exchanges.18 IEX also believes
related to the CRD system, which are and furthers the objectives of Sections that it is appropriate, reasonable and
collected by FINRA.11 As proposed, [sic] 6(b)(4) 14 of the Act, in particular, consistent with the Act, not to charge a
FINRA will collect and retain certain in that it is designed to provide for the fee for transactions that include
regulatory fees via the CRD system for equitable allocation of reasonable dues, execution of an order with displayed
the registration of persons associated fees and other charges among its priority on the Order Book. This fee
with an Exchange Members [sic] that are Members and other persons using its structure is designed to incentivize
not also FINRA members. The CRD facilities. Additionally, IEX believes that Members to send IEX aggressively
system fees are use-based and there is the proposed fees are consistent with priced displayable orders, thereby
no distinction in the cost incurred by the investor protection objectives of contributing to price discovery and
FINRA if the user is a FINRA member Section 6(b)(5) 15 of the Act in particular consistent with the overall goal of
or a member of an exchange but not a in that they are designed to promote just enhancing market quality. IEX believes
FINRA member. Accordingly, IEX is and equitable principles of trade, to that not charging a fee for both the
proposing to adopt the fees under IEX remove impediments to a free and open liquidity adder and remover is equitable
Rule 15.110(a) to mirror those assessed market and national market system, and and not unfairly discriminatory because
by FINRA pursuant to Section (4) of in general to protect investors and the it is designed to facilitate execution of,
Schedule A to the FINRA By-Laws. As public interest. and enhance trading opportunities for,
proposed, the fees are as follows: 12 The proposed Fee Schedule set forth displayable orders, thereby further
(1) $100 for each initial Form U4 filed for herein is designed to minimize incentivizing entry of displayed orders.
the registration of a representative or incentives for trading and order routing In addition, the Exchange believes
principal; decisions based solely on rebates that that it is appropriate, and consistent
(2) $110 for the additional processing of could create conflicts of interest by with the Act, to not charge a fee to
each initial or amended Form U4, Form U5 Members with respect to displayable
or Form BD that includes the initial skewing economic incentives related to
reporting, amendment, or certification of one such decisions. In addition, by not orders that remove non-displayed
or more disclosure events or proceedings; offering rebates, IEX has simplified its liquidity upon entry so long as at least
(3) $45 annual for each of the Member’s order type offering to avoid order types 90% of the Member’s aggregate executed
registered representatives and principals for designed to assure receipt of a rebate.16 shares of displayable orders added
system processing; By contrast, as proposed, IEX will liquidity during the month in question.
(4) $15 for processing and posting to the charge relatively low fees for all This flexibility is designed to address
CRD system each set of fingerprint cards limited inadvertent liquidity removal
submitted electronically by the Member, plus
executed shares, and which will be
a pass-through of any other charge imposed significantly lower than many other for Exchange Members who are largely
by the United States Department of Justice for exchange fees charged for removing (or adding displayed liquidity. Under these
processing each set of fingerprints; taking) liquidity.17 Moreover, IEX circumstances, the Member generally
(5) $30 for processing and posting to the intends to add displayed liquidity on
CRD system each set of fingerprint cards 13 15 U.S.C. 78f. IEX, and the Exchange therefore
submitted in non-electronic format by the 14 15 U.S.C. 78f(b)(4). believes that it is appropriate to provide
Member, plus a pass-through of any other 15 15 U.S.C. 78f(b)(5).
a fee incentive to such order, subject to
charge imposed by the United States 16 In an address on equity market structure on
the 90% limitation described herein, to
Department of Justice for processing each set June 5, 2014, Chair Mary Jo White called upon the
of fingerprints; and exchanges to conduct a comprehensive review of further encourage aggressively priced
their order types and how they operate, as well as displayed orders. The Exchange also
10 The Exchange will provide the Fee Code from to ‘‘consider appropriate rule changes to help believes that it is appropriate,
away market centers on execution reports of routed clarify the nature of their order types and how they reasonable and consistent with the Act,
transactions. In the proposed Fee Schedule, the Fee interact with each other, and how they support fair,
orderly, and efficient markets.’’ (See, speech by to charge the $0.0009 per share Non-
Code of ‘‘Alpha’’ is used to indicate this behavior.
11 The CRD system is the central licensing and Chair Mary Jo White at Sandler O’Neill & Partners, Displayed Match Fee to Members for the
registration system for the U.S. securities industry. L.P. Global Exchange and Brokerage Conference, resting, non-displayed order that
The CRD system enables individuals and firms New York, N.Y., available at http://www.sec.gov/ matches with the displayable order
seeking registration with multiple states and self- News/Speech/Detail/Speech/1370542004312)
17 For example, the New York Stock Exchange
under such circumstances because the
regulatory organizations to do so by submitting a
single form, fingerprint card and a combined trading fee schedule on its public Web site reflects reduced fee for Members entering
payment of fees to FINRA. Through the CRD fees to ‘‘take’’ liquidity ranging from $0.0024– displayable orders removing non-
system, FINRA maintains the qualification, $0.00275 depending on the type of market displayed liquidity is a narrowly drawn
employment and disciplinary histories of registered participant, order and execution (See, https://
www.nyse.com/markets/nyse/trading-info/fees).
incentive to address unintended
associated persons of broker dealers.
mstockstill on DSK3G9T082PROD with NOTICES
12 The Exchange has only adopted the CRD The Nasdaq Stock Market (‘‘Nasdaq’’) trading fee
system fees charged by FINRA to Non-FINRA schedule on its public Web site reflects fees to ranging from $0.0030 for shares executed at or
Members when such fees are applicable. In this ‘‘remove’’ liquidity ranging from $0.0030 per share above $1.00 or 0.30% of total dollar volume for
regard, certain FINRA CRD system fees and for shares executed at or above $1.00 or 0.30% of shares executed below $1.00, subject to certain
requirements are specific to FINRA members, but total dollar volume for shares executed below $1.00 limited exceptions for orders trading in the
do not apply to IEX Members that are not also (See, http://nasdaqtrader.com/ opening, IPO or halt auctions BZX listed securities
FINRA members. IEX Members that are also FINRA Trader.aspx?id=PriceListTrading2). BATS BZX (See, https://www.batstrading.com/support/fee_
members are charged CRD system fees according to Exchange (‘‘BZX) trading fee schedule on its public schedule/bzx/).
Section (4) of Schedule A to the FINRA By-Laws. Web site reflects fees for ‘‘removing’’ liquidity 18 Id.
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![54876 Federal Register / Vol. 81, No. 159 / Wednesday, August 17, 2016 / Notices
can calculate whether the sum of between customers, issuers, brokers, or the proposed fees are reasonable
executions with Fee Code L and a Last dealers, and is designed to promote just because they help to ensure the integrity
Liquidity Indicator (FIX tag 851) of ‘1’ and equitable principles of trade, to of the information in the CRD system,
(Added Liquidity), divided by the sum remove impediments to and perfect the which is important because the
of executions with Fee Code L is at least mechanism of a free and open market Commission, FINRA, other self-
90%. and a national market system. For the regulatory organizations and state
In summary, IEX believes that the foregoing reasons, the Exchange believes securities regulators use the CRD system
proposed fee structure for internalized that its simplified fee structure is to make licensing and registration
transactions is reasonable, fair and consistent with the Act, in that it is decisions, among other things.31
equitable, and not an unfairly designed to promote just and equitable The Exchange also believes that the
discriminatory allocation of fees principles of trade, to remove proposed fees, like FINRA’s fees, are
because it will provide all Members impediments to a free and open market consistent with an equitable allocation
with incentives not to avoid sending and national market system and in of fees because the fees will apply
orders to IEX that will contribute to general to protect investors and the equally to all individuals and members
enhanced liquidity and price discovery public interest. required to report information to the
on a regulated exchange. While not all CRD system. Thus, those members that
Members necessarily will have the Regulatory Fees register more individuals or submit
ability to directly benefit from the IEX believes that the proposed rule more filings through the CRD system
proposed fee structure for internalized change is consistent with the provisions will generally pay more in fees than
transactions, as noted above of Section 6(b) 27 of the Act in general, those members that use the CRD system
internalization is not guaranteed so IEX and furthers the objectives of Section to a lesser extent. In addition, the
believes that Members generally may 6(b)(4) 28 of the Act, in particular, in that proposed fees, like FINRA’s fees, are
indirectly benefit from an increase in it provides for the equitable allocation equitable and not unfairly
order flow that does not internalize on of reasonable fees and other charges discriminatory because they will result
IEX, as has been the case on the ATS. among its members, and does not in the same regulatory fees being
With respect to orders routed to other unfairly discriminate between charged to all IEX Members required to
exchanges, the proposal to pass through customers, issuers, brokers and dealers. report information to the CRD system
fees charged by such other away trading All similarly situated Members are and for services performed by FINRA,
centers for executed shares plus charge subject to the same fee structure, and regardless of whether or not such
a fee of $0.0001 payable to IEX is a every Member firm must use the CRD Member is a FINRA member.
reasonable, fair and equitable, and not system for registration and disclosure.
The proposed fees are reasonable B. Self-Regulatory Organization’s
an unfairly discriminatory allocation of Statement on Burden on Competition
fees because the fee is applicable to all because they are identical to those
adopted by FINRA for use of the CRD Transaction Fees
Members in an equivalent manner. The
$0.0001 fee payable to IEX is not system for disclosure and the IEX does not believe that the
inconsistent with the fees charged by registration of associated persons of proposed rule change will result in any
other exchanges for routed orders, since FINRA members.29 As FINRA noted in burden on competition that is not
many of their routing fees are variable its filing adopting its existing fees, it necessary or appropriate in furtherance
based on the fees and rebates charged by believes the fees are reasonable based on of the purposes of the Act. The
such other venues.26 Accordingly, the the increased costs associated with Exchange does not believe that the
IEX proposed approach raises no new or operating and maintaining the CRD proposed rule change will impose any
novel issues. system, and listed a number of burden on intermarket competition that
As described more fully below in the enhancements made to the CRD system is not necessary or appropriate in
Exchange’s statement regarding the since the last fee increase, including: (1) furtherance of the purposes of the Act.
burden on competition, the Exchange Incorporation of various uniform To the contrary, the Exchange believes
believes that it is subject to significant registration form changes; (2) electronic that the proposed pricing structure will
competitive forces, and that its fingerprint processing; (3) Web EFTTM, increase competition and hopefully
proposed fee structure is an appropriate which allows subscribing firms to draw additional volume to the
effort to address such forces. submit batch filings to the CRD system; Exchange. The Exchange will operate in
IEX also believes that not charging a (4) increases in the number and types of a highly competitive market in which
fee for membership, connectivity or reports available through the CRD market participants can readily favor
market data is reasonable because it may system; and (5) significant changes to competing venues if fee schedules at
incentivize broker-dealers to become BrokerCheck, including making other venues are viewed as more
members of the Exchange and to BrokerCheck easier to use and favorable. As a new exchange, IEX
therefore direct order flow to IEX. As a expanding the amount of information expects to face intense competition from
new exchange, IEX will operate in a made available through the system.30 existing exchanges and other non-
highly competitive environment, and These increased costs are similarly exchange venues that provide markets
not charging fees for such services and borne by FINRA when a member of IEX for equities trading. Consequently, the
access is designed to enable it to that is not a member of FINRA uses the Exchange believes that the degree to
compete effectively. CRD system, so the fees collected for which IEX fees could impose any
In conclusion, the Exchange also such use should mirror the fees assessed burden on competition is extremely
on FINRA members, as is proposed by limited, and does not believe that such
mstockstill on DSK3G9T082PROD with NOTICES
submits that its proposed fee structure
satisfies the requirements of Sections IEX. FINRA further noted its belief that fees would burden competition of
6(b)(4) and 6(b)(5) of the Act for the Members or competing venues in a
27 15 U.S.C. 78f.
reasons discussed above in that it does 28 15
manner that is not necessary or
U.S.C. 78f(b)(4).
not permit unfair discrimination 29 See Securities Exchange Act Release No. 67247
appropriate in furtherance of the
(June 25, 2012), 77 FR 38866 (June 29, 2012) (SR– purposes of the Act.
26 See, for example, Nasdaq Stock Market Rule FINRA–2012–30).
7018(a)(1). 30 See supra, note 27 [sic], at 77 FR 38866, 38868. 31 See supra [sic], at 77 FR 38866, 38868.
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![Federal Register / Vol. 81, No. 159 / Wednesday, August 17, 2016 / Notices 54877
The Exchange does not believe that Electronic Comments SECURITIES AND EXCHANGE
the proposed rule change will impose COMMISSION
any burden on intramarket competition • Use the Commission’s Internet
comment form (http://www.sec.gov/ [Release No. 34–78556; File No. SR–NYSE–
that is not necessary or appropriate in 2016–45]
furtherance of the purposes of the Act rules/sro.shtml); or
because, while different fees are • Send an email to rule-comments@ Self-Regulatory Organizations; New
assessed in some circumstances, these sec.gov. Please include File Number SR– York Stock Exchange LLC; Notice of
different fees are not based on the type IEX–2016–09 on the subject line. Filing of Proposed Rule Change
of Member entering the orders that Amending the Co-location Services
Paper Comments Offered by the Exchange To Add
match but on the type of order entered
and all Members can submit any type of • Send paper comments in triplicate Certain Access and Connectivity Fees
order. Further, the proposed fees are to Secretary, Securities and Exchange August 11, 2016.
intended to encourage market Commission, 100 F Street NE., Pursuant to section 19(b)(1) 1 of the
participants to bring increased volume Washington, DC 20549–1090. Securities Exchange Act of 1934 (the
to the Exchange, which benefits all ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
All submissions should refer to File
market participants. notice is hereby given that, on July 29,
Number SR–IEX–2016–09. This file
Regulatory Fees number should be included on the 2016, New York Stock Exchange LLC
subject line if email is used. To help the (‘‘NYSE’’ or the ‘‘Exchange’’) filed with
IEX does not believe that the the Securities and Exchange
Commission process and review your
proposed rule change will result in any Commission (the ‘‘Commission’’) the
comments more efficiently, please use
burden on competition that is not proposed rule change as described in
only one method. The Commission will Items I, II, and III below, which Items
necessary or appropriate in furtherance post all comments on the Commission’s
of the purposes of the Act. Specifically, have been prepared by the self-
Internet Web site (http://www.sec.gov/ regulatory organization. The
the Exchange believes that the proposed rules/sro.shtml). Copies of the
fees will result in the same regulatory Commission is publishing this notice to
submission, all subsequent solicit comments on the proposed rule
fees being charged to all Members amendments, all written statements
required to report information to the change from interested persons.
with respect to the proposed rule
CRD system and for services performed change that are filed with the I. Self-Regulatory Organization’s
by FINRA, regardless of whether or not Commission, and all written Statement of the Terms of the Substance
such Members are FINRA members. communications relating to the of the Proposed Rule Change
C. Self-Regulatory Organization’s proposed rule change between the The Exchange proposes to amend the
Statement on Comments on the Commission and any person, other than co-location services offered by the
Proposed Rule Change Received From those that may be withheld from the Exchange as follows: (1) To provide
Members, Participants, or Others public in accordance with the additional information regarding the
provisions of 5 U.S.C. 552, will be access to trading and execution services
Written comments were neither available for Web site viewing and and connectivity to data provided to
solicited nor received. printing in the Commission’s Public Users with local area networks available
Reference Room, 100 F Street NE., in the data center; and (2) to establish
III. Date of Effectiveness of the fees relating to User’s access to trading
Proposed Rule Change and Timing for Washington, DC 20549, on official
and execution services; connectivity to
Commission Action business days between the hours of
data feeds and to testing and
10:00 a.m. and 3:00 p.m. Copies of the certification feeds; access to clearing;
The foregoing rule change has become filing also will be available for and other services. In addition, this
effective pursuant to Section 19(b)(3)(A) inspection and copying at the principal proposed rule change reflects changes to
of the Act 32 and paragraph (f) of Rule office of the Exchange. All comments the Exchange’s Price List related to
19b–4 33 thereunder. At any time within received will be posted without change; these co-location services. The proposed
60 days of the filing of the proposed rule the Commission does not edit personal rule change is available on the
change, the Commission summarily may identifying information from Exchange’s Web site at www.nyse.com,
temporarily suspend such rule change if submissions. You should submit only at the principal office of the Exchange,
it appears to the Commission that such information that you wish to make and at the Commission’s Public
action is necessary or appropriate in the available publicly. All submissions Reference Room.
public interest, for the protection of should refer to File Number SR–IEX–
II. Self-Regulatory Organization’s
investors, or otherwise in furtherance of 2016–09, and should be submitted on or
Statement of the Purpose of, and
the purposes of the Act. before September 7, 2016. Statutory Basis for, the Proposed Rule
IV. Solicitation of Comments For the Commission, by the Division of Change
Trading and Markets, pursuant to delegated
In its filing with the Commission, the
Interested persons are invited to authority.34
self-regulatory organization included
submit written data, views, and Robert W. Errett, statements concerning the purpose of,
arguments concerning the foregoing,
mstockstill on DSK3G9T082PROD with NOTICES
Deputy Secretary. and basis for, the proposed rule change
including whether the proposed rule [FR Doc. 2016–19581 Filed 8–16–16; 8:45 am] and discussed any comments it received
change is consistent with the Act. on the proposed rule change. The text
BILLING CODE 8011–01–P
Comments may be submitted by any of of those statements may be examined at
the following methods:
1 15 U.S.C. 78s(b)(1).
32 15 U.S.C. 78s(b)(3)(A). 2 15 U.S.C. 78a.
33 17 CFR 240.19b–4(f). 34 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4.
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Document Created: 2018-02-09 11:35:15
Document Modified: 2018-02-09 11:35:15
| 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 | 81 FR 54873 |
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