81 FR 5802 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Change Modifying the NYSE Amex Options Fee Schedule To Add an Early Adopter Specialist Credit
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 22 (February 3, 2016)
Federal Register Volume 81, Issue 22 (February 3, 2016)
| Page Range | 5802-5803 | |
| FR Document | 2016-01928 |
[Federal Register Volume 81, Number 22 (Wednesday, February 3, 2016)] [Notices] [Pages 5802-5803] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-01928] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-76992; File No. SR-NYSEMKT-2016-10] Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Change Modifying the NYSE Amex Options Fee Schedule To Add an Early Adopter Specialist Credit January 28, 2016. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, on January 20, 2016, NYSE MKT LLC (the ``Exchange'' or ``NYSE MKT'') filed with the Securities and Exchange Commission (the ``Commission'') the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \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 the Substance of the Proposed Rule Change The Exchange proposes to modify the NYSE Amex Options Fee Schedule (``Fee Schedule''). The Exchange proposes to implement the fee change effective February 1, 2016. The proposed change is available on the Exchange's Web site at www.nyse.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to implement a monthly credit available to Specialists to promote trading in Binary Return Derivatives (``ByRDs''),\4\ which is a new product that the Exchange anticipates launching in February 2016. --------------------------------------------------------------------------- \4\ See Securities Exchange Act Release No. 56251 (August 14, 2007), 72 FR 46523 (August 20, 2007) (SR-Amex-2004-27) (Order approving listing of Fixed Return Options (``FROs'')); see also Securities Exchange Act Release No. 71957 (April 16, 2014), 79 FR 22563 (April 22, 2014) (SR-NYSEMKT-2014-06) (Order approving name change from FROs to Binary Return Derivatives (ByRDs) and re-launch of these products, with certain modification, and amending Obvious Errors rules to include ByRDs). ByRDs are European-style option contracts on individual stocks, exchange-traded funds and Index- Linked Securities that have a fixed return in cash based on a set strike price; satisfy specified listing criteria; and may only be exercised at expiration pursuant to the Rules of the Options Clearing Corporation. See, e.g., NYSE MKT Rule 900ByRDs. --------------------------------------------------------------------------- To encourage trading of ByRDs, the Exchange proposes to offer an incentive to Specialists appointed to trade ByRDs.\5\ Specialists that are appointed in ByRDs and eligible for the incentive payment would be known on the Exchange's Fee Schedule as ``Early Adopter Specialists.'' Specifically, effective February 1, 2016, the Exchange proposes to offer each ``Early Adopter Specialist'' a monthly credit of $335 for each class of ByRDs for which that Specialist is appointed, which the Exchange believes would provide a competitive incentive to Specialists based on market conditions and competing interests for technology.\6\ The Exchange believes the proposed incentive payment would further the Exchange's goal of introducing new products to the marketplace by encouraging Specialists to make a market for these products. --------------------------------------------------------------------------- \5\ Each Specialist must be registered with the Exchange as a Market Maker and is thus subject to the quoting requirements imposed on Market Makers. See, e.g., Rules 920NY, 925.1NY(b) and 927NY. \6\ See proposed Section I.H. of the Fee Schedule, which was previously Reserved. --------------------------------------------------------------------------- 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,\7\ in general, and furthers the objectives of Sections 6(b)(4) and (5) of the Act,\8\ in particular, because it provides for the equitable allocation of reasonable dues, fees, and other charges among its members, issuers and other persons using its facilities and does not unfairly discriminate between customers, issuers, brokers or dealers. --------------------------------------------------------------------------- \7\ 15 U.S.C. 78f(b). \8\ 15 U.S.C. 78f(b)(4) and (5). --------------------------------------------------------------------------- The Exchange believes that the proposed monthly credit is reasonable, equitable and not unfairly discriminatory for the following reasons. First, the proposed credit would generate additional order flow to the Exchange by creating incentives to quote and trade ByRDs options, which would benefit all market participants even those not eligible to receive the credit. The Exchange believes it is appropriate to offer the credit to Specialists (and not to other types of Market Makers) as the Specialists are subject to heightened continuous quoting obligations, which exceed those imposed on other Market Makers.\9\ The Exchange believes the proposed credit would recognize the contributions of each Early Adopter Specialist to the trading environment on the Exchange and is designed to attract Specialists willing to seek appointments in and, thus provide continuous quotes in, ByRDs options, which increase in the availability of ByRDs options would benefit all market participants. --------------------------------------------------------------------------- \9\ See supra n. 5. --------------------------------------------------------------------------- In addition, the Exchange has evaluated the market conditions, including the technology needs of Specialists appointed to options on ByRDs and believes the proposed monthly credit of $335 is reasonable, equitable and not unfairly discriminatory.\10\ The Exchange notes that offering market participants incentives to trade in certain newly offered products is not new of novel.\11\ --------------------------------------------------------------------------- \10\ In determining the $335 fee, the Exchange considered factors such as systems upgrades and additional data feeds that may be necessary to act as a Specialist in ByRDS. \11\ See Exchange Act Release No. 34-60536 (August 19, 2009), 74 FR 43204 (August 26, 2009) (SR-ISE-2009-59). --------------------------------------------------------------------------- For these reasons, the Exchange believes that the proposal is consistent with the Act. B. Self-Regulatory Organization's Statement on Burden on Competition In accordance with Section 6(b)(8) of the Act,\12\ the Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange believes the proposed incentive is pro-competitive as it would further the Exchange's goal of [[Page 5803]] introducing new products to the marketplace and encouraging Specialists to make a market in these products, which would in turn, benefit market participants. --------------------------------------------------------------------------- \12\ 15 U.S.C. 78f(b)(8). --------------------------------------------------------------------------- To the extent that there is an additional competitive burden on market participants that are not eligible for the credit (i.e., non- Specialists), the Exchange believes that this is appropriate because the proposal would incent Specialists to quote and trade in options on ByRDs which would enhance the quality of the Exchange's markets and increases the volume of contracts traded here. To the extent that this purpose is achieved, all of the Exchange's market participants should benefit from the improved market liquidity. Enhanced market quality and increased transaction volume that results from the anticipated increase in order flow directed to the Exchange will benefit all market participants and improve competition on the Exchange. Moreover, the Exchange believes it is appropriate to offer the credit to Specialists (and not to other types of Market Makers) as Specialists are subject to heightened continuous quoting obligations that exceed those required of other Market Makers.\13\ --------------------------------------------------------------------------- \13\ See supra n. 5. --------------------------------------------------------------------------- C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change is effective upon filing pursuant to Section 19(b)(3)(A) \14\ of the Act and subparagraph (f)(2) of Rule 19b-4 \15\ thereunder, because it establishes a due, fee, or other charge imposed by the Exchange. --------------------------------------------------------------------------- \14\ 15 U.S.C. 78s(b)(3)(A). \15\ 17 CFR 240.19b-4(f)(2). --------------------------------------------------------------------------- At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B) \16\ of the Act to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \16\ 15 U.S.C. 78s(b)(2)(B). --------------------------------------------------------------------------- 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-NYSEMKT-2016-10 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-NYSEMKT-2016-10. 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 such filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEMKT-2016-10, and should be submitted on or before February 24, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\17\ --------------------------------------------------------------------------- \17\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2016-01928 Filed 2-2-16; 8:45 am] BILLING CODE 8011-01-P
![5802 Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices
For the Commission, by the Division of The Exchange has prepared summaries, because it provides for the equitable
Trading and Markets, pursuant to delegated set forth in sections A, B, and C below, allocation of reasonable dues, fees, and
authority.11 of the most significant parts of such other charges among its members,
Robert W. Errett, statements. issuers and other persons using its
Deputy Secretary. facilities and does not unfairly
A. Self-Regulatory Organization’s
[FR Doc. 2016–01929 Filed 2–2–16; 8:45 am]
Statement of the Purpose of, and discriminate between customers,
BILLING CODE 8011–01–P
Statutory Basis for, the Proposed Rule issuers, brokers or dealers.
The Exchange believes that the
Change
proposed monthly credit is reasonable,
SECURITIES AND EXCHANGE 1. Purpose equitable and not unfairly
COMMISSION The purpose of this filing is to discriminatory for the following
implement a monthly credit available to reasons. First, the proposed credit
[Release No. 34–76992; File No. SR–
NYSEMKT–2016–10] Specialists to promote trading in Binary would generate additional order flow to
Return Derivatives (‘‘ByRDs’’),4 which is the Exchange by creating incentives to
Self-Regulatory Organizations; NYSE a new product that the Exchange quote and trade ByRDs options, which
MKT LLC; Notice of Filing and anticipates launching in February 2016. would benefit all market participants
Immediate Effectiveness of Proposed To encourage trading of ByRDs, the even those not eligible to receive the
Change Modifying the NYSE Amex Exchange proposes to offer an incentive credit. The Exchange believes it is
Options Fee Schedule To Add an Early to Specialists appointed to trade appropriate to offer the credit to
Adopter Specialist Credit ByRDs.5 Specialists that are appointed Specialists (and not to other types of
in ByRDs and eligible for the incentive Market Makers) as the Specialists are
January 28, 2016. payment would be known on the subject to heightened continuous
Pursuant to Section 19(b)(1) 1 of the Exchange’s Fee Schedule as ‘‘Early quoting obligations, which exceed those
Securities Exchange Act of 1934 (the Adopter Specialists.’’ Specifically, imposed on other Market Makers.9 The
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 effective February 1, 2016, the Exchange Exchange believes the proposed credit
notice is hereby given that, on January proposes to offer each ‘‘Early Adopter would recognize the contributions of
20, 2016, NYSE MKT LLC (the Specialist’’ a monthly credit of $335 for each Early Adopter Specialist to the
‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with each class of ByRDs for which that trading environment on the Exchange
the Securities and Exchange Specialist is appointed, which the and is designed to attract Specialists
Commission (the ‘‘Commission’’) the Exchange believes would provide a willing to seek appointments in and,
proposed rule change as described in competitive incentive to Specialists thus provide continuous quotes in,
Items I, II, and III below, which Items based on market conditions and ByRDs options, which increase in the
have been prepared by the self- competing interests for technology.6 The availability of ByRDs options would
regulatory organization. The Exchange believes the proposed benefit all market participants.
Commission is publishing this notice to incentive payment would further the In addition, the Exchange has
solicit comments on the proposed rule Exchange’s goal of introducing new evaluated the market conditions,
change from interested persons. products to the marketplace by including the technology needs of
I. Self-Regulatory Organization’s encouraging Specialists to make a Specialists appointed to options on
Statement of the Terms of the Substance market for these products. ByRDs and believes the proposed
of the Proposed Rule Change monthly credit of $335 is reasonable,
2. Statutory Basis
equitable and not unfairly
The Exchange proposes to modify the The Exchange believes that the discriminatory.10 The Exchange notes
NYSE Amex Options Fee Schedule proposed rule change is consistent with that offering market participants
(‘‘Fee Schedule’’). The Exchange Section 6(b) of the Act,7 in general, and incentives to trade in certain newly
proposes to implement the fee change furthers the objectives of Sections offered products is not new of novel.11
effective February 1, 2016. The 6(b)(4) and (5) of the Act,8 in particular, For these reasons, the Exchange
proposed change is available on the believes that the proposal is consistent
Exchange’s Web site at www.nyse.com, 4 See Securities Exchange Act Release No. 56251
with the Act.
(August 14, 2007), 72 FR 46523 (August 20, 2007)
at the principal office of the Exchange, (SR–Amex–2004–27) (Order approving listing of
and at the Commission’s Public B. Self-Regulatory Organization’s
Fixed Return Options (‘‘FROs’’)); see also Securities
Reference Room. Exchange Act Release No. 71957 (April 16, 2014),
Statement on Burden on Competition
79 FR 22563 (April 22, 2014) (SR–NYSEMKT– In accordance with Section 6(b)(8) of
II. Self-Regulatory Organization’s 2014–06) (Order approving name change from FROs
the Act,12 the Exchange does not believe
Statement of the Purpose of, and to Binary Return Derivatives (ByRDs) and re-launch
of these products, with certain modification, and that the proposed rule change will
Statutory Basis for, the Proposed Rule amending Obvious Errors rules to include ByRDs). impose any burden on competition that
Change ByRDs are European-style option contracts on is not necessary or appropriate in
individual stocks, exchange-traded funds and
In its filing with the Commission, the Index-Linked Securities that have a fixed return in furtherance of the purposes of the Act.
self-regulatory organization included cash based on a set strike price; satisfy specified The Exchange believes the proposed
statements concerning the purpose of, listing criteria; and may only be exercised at incentive is pro-competitive as it would
and basis for, the proposed rule change expiration pursuant to the Rules of the Options further the Exchange’s goal of
Clearing Corporation. See, e.g., NYSE MKT Rule
and discussed any comments it received 900ByRDs.
mstockstill on DSK4VPTVN1PROD with NOTICES
on the proposed rule change. The text 5 Each Specialist must be registered with the 9 See supra n. 5.
10 Indetermining the $335 fee, the Exchange
of those statements may be examined at Exchange as a Market Maker and is thus subject to
the quoting requirements imposed on Market considered factors such as systems upgrades and
the places specified in Item IV below. Makers. See, e.g., Rules 920NY, 925.1NY(b) and additional data feeds that may be necessary to act
927NY. as a Specialist in ByRDS.
11 17 CFR 200.30–3(a)(12). 6 See proposed Section I.H. of the Fee Schedule, 11 See Exchange Act Release No. 34–60536
1 15 U.S.C. 78s(b)(1). which was previously Reserved. (August 19, 2009), 74 FR 43204 (August 26, 2009)
2 15 U.S.C. 78a. 7 15 U.S.C. 78f(b). (SR–ISE–2009–59).
3 17 CFR 240.19b–4. 8 15 U.S.C. 78f(b)(4) and (5). 12 15 U.S.C. 78f(b)(8).
VerDate Sep<11>2014 19:14 Feb 02, 2016 Jkt 238001 PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 E:\FR\FM\03FEN1.SGM 03FEN1](https://thefederalregister.org/doc/81_FR_5824/page/1.svg)
![Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices 5803
introducing new products to the change should be approved or For the Commission, by the Division of
marketplace and encouraging disapproved. Trading and Markets, pursuant to delegated
Specialists to make a market in these authority.17
products, which would in turn, benefit IV. Solicitation of Comments Robert W. Errett,
market participants. Deputy Secretary.
Interested persons are invited to
To the extent that there is an submit written data, views, and [FR Doc. 2016–01928 Filed 2–2–16; 8:45 am]
additional competitive burden on BILLING CODE 8011–01–P
arguments concerning the foregoing,
market participants that are not eligible
including whether the proposed rule
for the credit (i.e., non-Specialists), the
change is consistent with the Act.
Exchange believes that this is SECURITIES AND EXCHANGE
Comments may be submitted by any of
appropriate because the proposal would COMMISSION
incent Specialists to quote and trade in the following methods:
[Release No. 34–76996; File No. SR–
options on ByRDs which would Electronic Comments NYSEMKT–2016–12]
enhance the quality of the Exchange’s
markets and increases the volume of • Use the Commission’s Internet Self-Regulatory Organizations; NYSE
contracts traded here. To the extent that comment form (http://www.sec.gov/ MKT LLC; Notice of Filing of Proposed
this purpose is achieved, all of the rules/sro.shtml); or Rule Change Amending the NYSE MKT
Exchange’s market participants should • Send an email to rule-comments@ Company Guide To Create a New
benefit from the improved market sec.gov. Please include File Number SR– Section 146 Under Which a Certain
liquidity. Enhanced market quality and NYSEMKT–2016–10 on the subject line. Category of Newly Listed Issuers
increased transaction volume that Would Be Entitled To Receive
results from the anticipated increase in Paper Comments Complimentary Products and Services
order flow directed to the Exchange will From the Exchange
benefit all market participants and • Send paper comments in triplicate
improve competition on the Exchange. to Secretary, Securities and Exchange January 28, 2016.
Moreover, the Exchange believes it is Commission, 100 F Street NE., Pursuant to Section 19(b)(1) 1 of the
appropriate to offer the credit to Washington, DC 20549–1090. Securities Exchange Act of 1934 (the
Specialists (and not to other types of All submissions should refer to File ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
Market Makers) as Specialists are Number SR–NYSEMKT–2016–10. This notice is hereby given that, on January
subject to heightened continuous 14, 2016, NYSE MKT LLC (the
file number should be included on the
quoting obligations that exceed those ‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with
subject line if email is used. To help the
required of other Market Makers.13 the Securities and Exchange
Commission process and review your
Commission (the ‘‘Commission’’) the
C. Self-Regulatory Organization’s comments more efficiently, please use
proposed rule change as described in
Statement on Comments on the only one method. The Commission will Items I, II, and III below, which Items
Proposed Rule Change Received From post all comments on the Commission’s have been prepared by the self-
Members, Participants, or Others Internet Web site (http://www.sec.gov/ regulatory organization. The
No written comments were solicited rules/sro.shtml). Copies of the Commission is publishing this notice to
or received with respect to the proposed submission, all subsequent solicit comments on the proposed rule
rule change. amendments, all written statements change from interested persons.
with respect to the proposed rule
III. Date of Effectiveness of the change that are filed with the I. Self-Regulatory Organization’s
Proposed Rule Change and Timing for Commission, and all written Statement of the Terms of Substance of
Commission Action communications relating to the the Proposed Rule Change
The foregoing rule change is effective proposed rule change between the The Exchange proposes to amend the
upon filing pursuant to Section Commission and any person, other than NYSE MKT Company Guide (the
19(b)(3)(A) 14 of the Act and those that may be withheld from the ‘‘Company Guide’’) to create a new
subparagraph (f)(2) of Rule 19b–4 15 public in accordance with the Section 146 under which a certain
thereunder, because it establishes a due, provisions of 5 U.S.C. 552, will be category of newly listed issuers would
fee, or other charge imposed by the available for Web site viewing and be entitled to receive complimentary
Exchange. printing in the Commission’s Public products and services from the
At any time within 60 days of the Reference Room, 100 F Street NE., Exchange. The proposed rule change is
filing of such proposed rule change, the Washington, DC 20549 on official available on the Exchange’s Web site at
Commission summarily may business days between the hours of www.nyse.com, at the principal office of
temporarily suspend such rule change if 10:00 a.m. and 3:00 p.m. Copies of such the Exchange, and at the Commission’s
it appears to the Commission that such filing also will be available for Public Reference Room.
action is necessary or appropriate in the inspection and copying at the principal
public interest, for the protection of II. Self-Regulatory Organization’s
office of the Exchange. All comments Statement of the Purpose of, and
investors, or otherwise in furtherance of received will be posted without change;
the purposes of the Act. If the Statutory Basis for, the Proposed Rule
the Commission does not edit personal Change
Commission takes such action, the identifying information from
mstockstill on DSK4VPTVN1PROD with NOTICES
Commission shall institute proceedings submissions. You should submit only In its filing with the Commission, the
under Section 19(b)(2)(B) 16 of the Act to information that you wish to make self-regulatory organization included
determine whether the proposed rule available publicly. All submissions statements concerning the purpose of,
13 See
should refer to File Number SR–
supra n. 5. 17 17 CFR 200.30–3(a)(12).
14 15 U.S.C. 78s(b)(3)(A).
NYSEMKT–2016–10, and should be 1 15 U.S.C.78s(b)(1).
15 17 CFR 240.19b–4(f)(2). submitted on or before February 24, 2 15 U.S.C. 78a.
16 15 U.S.C. 78s(b)(2)(B). 2016. 3 17 CFR 240.19b–4.
VerDate Sep<11>2014 19:14 Feb 02, 2016 Jkt 238001 PO 00000 Frm 00101 Fmt 4703 Sfmt 4703 E:\FR\FM\03FEN1.SGM 03FEN1](https://thefederalregister.org/doc/81_FR_5824/page/2.svg)
Document Created: 2016-02-03 00:40:17
Document Modified: 2016-02-03 00:40:17
| 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 5802 |
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR