81 FR 60077 - Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fee Schedule
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 169 (August 31, 2016)
Federal Register Volume 81, Issue 169 (August 31, 2016)
| Page Range | 60077-60080 | |
| FR Document | 2016-20894 |
[Federal Register Volume 81, Number 169 (Wednesday, August 31, 2016)] [Notices] [Pages 60077-60080] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-20894] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-78681; File No. SR-MIAX-2016-28] Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fee Schedule August 25, 2016. Pursuant to the provisions of Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on August 11, 2016, Miami International Securities Exchange LLC (``MIAX'' or ``Exchange'') filed with the Securities and Exchange Commission (``Commission'') a proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange is filing a proposal to amend the MIAX Options Fee Schedule (the ``Fee Schedule''). The text of the proposed rule change is available on the Exchange's Web site at http://www.miaxoptions.com/filter/wotitle/rule_filing, at MIAX's principal office, and at the Commission's Public Reference Room. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Section 1)b) of the Fee Schedule, Marketing Fee, to add to the list of symbols for which the Exchange assesses a $0.12 per contract Posted Liquidity Marketing Fee. In addition to the current symbols listed in Section 1)b), the Exchange is proposing to assess the Posted Liquidity Marketing Fee for contracts executed in DIA, FB, GDX, SLV, USO, UVXY, and VXX. The Exchange also proposes to assess the applicable per contract non-Market Maker transaction fees for executions in these new symbols, as described more fully below. A Marketing Fee is assessed on certain transactions of all Market Makers.\3\ Currently, Section 1) b) of the Fee Schedule provides that the Exchange will assess: --------------------------------------------------------------------------- \3\ See MIAX Fee Schedule, Section 1)b), entitled ``Marketing Fee'' for more detail regarding the Marketing Fee. --------------------------------------------------------------------------- (i) A Marketing Fee to all Market Makers for contracts, including mini options, they execute in their assigned classes when the contra- party to the execution is a Priority Customer. MIAX will not assess a Marketing Fee to Market Makers for contracts executed as a PRIME Agency Order, Contra-side Order, Qualified Contingent Cross Order, PRIME Participating Quote or Order, or a PRIME AOC Response in the PRIME Auction, unless it executes against an unrelated order. (ii) an additional $0.12 per contract Posted Liquidity Marketing Fee to all Market Makers for any standard options overlying EEM, GLD, IWM, QQQ, and SPY that Market Makers execute in their assigned class when the contra-party to the execution is a Priority Customer and the Priority Customer order was posted on the MIAX Book at the time of the execution. MIAX will not assess the additional Posted Liquidity Marketing Fee to Market Makers for contracts executed as a PRIME Agency Order, Contra-side Order, Qualified Contingent Cross Order, or a PRIME AOC Response or PRIME Participating Quote or Order in the PRIME Auction. MIAX will also not assess the additional Posted Liquidity Marketing Fee to Market Makers for contracts executed pursuant to a Liquidity Refresh Pause, route timer, or during the Opening Process. This Posted Liquidity Marketing Fee is in addition to the current Marketing Fee of $0.25 per contract for standard options overlying these enumerated symbols that Market Makers execute in their assigned class when the contra-party to the execution is a Priority Customer.\4\ --------------------------------------------------------------------------- \4\ See Securities Exchange Act Release No. 73848 (December 16, 2014), 79 FR 76421 (December 22, 2014) (SR-MIAX-2014-62) (Notice of Filing and Immediate Effectiveness of MIAX Posted Liquidity Marketing Fee with respect to EEM, GLD, IWM, QQQ and SPY). --------------------------------------------------------------------------- Funds collected via the Marketing Fee, including the additional $0.12 per contract Posted Liquidity Marketing Fee, are put into ``pools'' controlled by Primary Lead Market Makers (``PLMMs'') \5\ and Lead Market Makers (``LMMs'').\6\ So for example, the $0.12 per contract Posted Liquidity Marketing Fee goes into the broader Marketing Fee pool for the Directed LMM or the PLMM [[Page 60078]] in EEM, GLD, IWM, QQQ or SPY, as applicable. The PLMM or LMM controlling a certain pool of funds can then determine the Electronic Exchange Member(s) (``EEM'') \7\ to which the funds should be directed in order to encourage such EEM(s) to send orders to the Exchange. In accordance with Exchange Rule 514, an EEM can designate an order (``Directed Order'') to a specific LMM. --------------------------------------------------------------------------- \5\ The term ``Primary Lead Market Maker'' means a Lead Market Maker appointed by the Exchange to act as the Primary Lead Market Maker for the purpose of making markets in securities traded on the Exchange. The Primary Lead Market Maker is vested with the rights and responsibilities specified in Chapter VI of these Rules with respect to Primary Lead Market Makers. See Exchange Rule 100. \6\ The term ``Lead Market Maker'' means a Member registered with the Exchange for the purpose of making markets in securities traded on the Exchange and that is vested with the rights and responsibilities specified in Chapter VI of these Rules with respect to Lead Market Makers. When a Lead Market Maker is appointed to act in the capacity of a Primary Lead Market Maker, the additional rights and responsibilities of a Primary Lead Market Maker specified in Chapter VI of these Rules will apply. See Exchange Rule 100. \7\ The term ``Electronic Exchange Member'' means the holder of a Trading Permit who is not a Market Maker. Electronic Exchange Members are deemed ``members'' under the Act. See Exchange Rule 100. --------------------------------------------------------------------------- The purpose of the Posted Liquidity Marketing Fee is to further encourage Members to post additional Priority Customer orders on the Exchange's Book in the enumerated high volume symbols. Increased Priority Customer orders on the Exchange's Book in these symbols provides for greater liquidity, which benefits all market participants on the Exchange. The Exchange now proposes to add to the following high volume symbols to its Posted Liquidity Marketing Fee program: DIA, FB, GDX, SLV, USO, UVXY, and VXX,\8\ as reflected in the proposed amendments to Section (1)(b) and Footnote 15 of the Fee Schedule. The practice of encouraging increased retail customer order flow in order to attract professional liquidity providers (Market Makers) is, and has been, commonly applied in the options markets. As such, marketing fee programs \9\ and posting incentive programs \10\ are based on attracting public customer order flow. Additional incentives intended to increase order flow in high volume symbols are, and have been, commonly offered in the options markets.\11\ The proposed Posted Liquidity Marketing Fee with respect to high volume symbols DIA, FB, GDX, SLV, USO, UVXY, and VXX similarly is intended to attract Priority Customer order flow, which will increase liquidity, thereby providing greater trading opportunities and tighter spreads for other market participants and causing a corresponding increase in order flow from such other market participants. Increasing the number of orders sent to the Exchange will in turn provide tighter and more liquid markets, and therefore attract more business overall. --------------------------------------------------------------------------- \8\ DIA, FB, GDX, SLV, USO, UVXY, and VXX had among the highest MIAX volume by class as reported by the Options Clearing Corporation (``OCC'') for June 2016. See http://www.optionsclearing.com/webapps/volbyclass-reports?reportClass=miax. \9\ See MIAX Fee Schedule, Section (1)( b); Chicago Board Options Exchange, Incorporated (``CBOE'') Fees Schedule, p. 4; NYSE Amex Options Fee Schedule, p. 7. \10\ See NYSE Arca, Inc. (``Arca'') Options Fees and Charges Schedule, page 5. \11\ See International Securities Exchange, LLC (``ISE'') Schedule of Fees, p. 6 ; Arca Option Fees and Charges Schedule, p. 5. --------------------------------------------------------------------------- The Exchange also proposes to adopt the same additional $0.50 per contract transaction fee for options overlying DIA, FB, GDX, SLV, USO, UVXY, and VXX executed by non-MIAX Market Makers as currently applies to options overlying EEM, GLD, IWM, QQQ, and SPY executed by non-MIAX Market Makers as set forth in footnote 8, Section (1)(a)(ii) of the Fee Schedule.\12\ The purpose of the proposed fee change is to assess the transaction fee for non-MIAX Market Makers in the new symbols (DIA, FB, GDX, SLV, USO, UVXY, and VXX) that are being added to the Exchange's Posted Liquidity Marketing Fee, in the same manner as the current symbols that are included in each fee. --------------------------------------------------------------------------- \12\ See Securities Exchange Act Release No. 73850 (December 16, 2014), 79 FR 76424 (December 22, 2014) (SR-MIAX-2014-63) (Notice of Filing and Immediate Effectiveness of MIAX non-Market Maker Transaction Fee with respect to EEM, GLD, IWM, QQQ and SPY). --------------------------------------------------------------------------- 2. Statutory Basis MIAX believes that its proposed rule change is consistent with Section 6(b) of the Act \13\ in general, and in particular, furthers the objectives of Section 6(b)(4) of the Act,\14\ in that it is an equitable allocation of reasonable dues, fees, and other charges among its Members and other persons using its facilities, and 6(b)(5) of the Act,\15\ in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in facilitating transactions in securities, to remove impediments to and perfect the mechanisms of a free and open market and a national market system and, in general, to protect investors and the public interest. --------------------------------------------------------------------------- \13\ 15 U.S.C. 78f(b). \14\ 15 U.S.C. 78f(b)(4). \15\ 15 U.S.C. 78f(b)(1) and (b)(5). --------------------------------------------------------------------------- The proposed changes are designed to incentivize order flow providers to post additional Priority Customer orders in DIA, FB, GDX, SLV, USO, UVXY, and VXX options on the Exchange's Book. The proposed marketing fee rate is reasonable in that although it may result in a marketing fee that is slightly higher than similar marketing fee programs, it is still in the range of marketing fee programs on other competing exchanges which charge lower marketing fees for Penny Pilot options classes versus non-Penny Pilot options classes.\16\ The proposed marketing fee is fair, equitable, and not unreasonably discriminatory because it will apply equally to all Market Makers that execute against Priority Customer orders in DIA, FB, GDX, SLV, USO, UVXY, and VXX options posted on the Exchange's Book. All similarly situated Market Makers that execute against Priority Customer orders in DIA, FB, GDX, SLV, USO, UVXY, and VXX options that are posted to the Exchange's Book are subject to the same marketing fee, and access to the Exchange is offered on terms that are not unfairly discriminatory. In addition, the proposal is equitable and not unfairly discriminatory because, while only posted Priority Customer order flow qualifies for the additional marketing fee, an increase in Priority Customer orders posted to the Exchange's Book will bring greater volume and liquidity as market participants compete to trade with the additional Priority Customer order flow, which benefits all market participants by providing more trading opportunities and tighter spreads. Market participants want to trade with Priority Customer order flow. To the extent the posting of Priority Customer orders on the Exchange's Book is increased by the proposal, market participants will increasingly compete for the opportunity to trade on the Exchange, including sending more orders and providing narrower and larger sized quotations in their effort to trade with such Priority Customer order flow. The resulting increased volume and liquidity will benefit non-Market Makers that do not pay the proposed fee and do not qualify for the marketing fee program at all, by providing more trading opportunities and tighter spreads as market participants increasingly compete by sending more orders and providing narrower and larger sized quotations in the effort to trade with such Priority Customer order flow. In addition, the proposed change is equitable and not unfairly discriminatory because it is designed to allow LMMs to encourage greater order flow to be sent to the Exchange. The Exchange believes it is equitable to assess marketing fees on Market Makers and not non-Market Makers because the benefits of the marketing fee program flow to PLMM and Directed LMMs that can use the marketing fee funds to attract additional flow to the Exchange, which benefits Market Makers. An LMM could amass a greater pool of funds to use to incentivize order flow providers to send order flow to the Exchange. This increased order flow would benefit all market participants on the Exchange as well. --------------------------------------------------------------------------- \16\ See CBOE Fees Schedule, p. 4; NYSE Amex Options Fee Schedule, p. 7. --------------------------------------------------------------------------- [[Page 60079]] The Exchange believes that its proposal to assess the additional Posted Liquidity Marketing Fee for transactions in DIA, FB, GDX, SLV, USO, UVXY, and VXX options, and not other options classes, is consistent with other options markets that provide additional incentives to increase order flow in high volume symbols including assessing different marketing fees for Penny options classes as compared to non-Penny options classes.\17\ The Exchange believes that establishing different pricing for DIA, FB, GDX, SLV, USO, UVXY, and VXX Penny Pilot options is reasonable, equitable, and not unfairly discriminatory because DIA, FB, GDX, SLV, USO, UVXY, and VXX options are more liquid options \18\ as compared to other Penny Pilot options and the Exchange wants to provide incentive for order flow providers to send such orders to MIAX in order to increase trading opportunities and overall volume executed on the Exchange. --------------------------------------------------------------------------- \17\ See CBOE Fees Schedule, p. 4; NYSE Amex Options Fee Schedule, p. 7; ISE Schedule of Fees, p. 13; NYSE Arca Options Fees and Charges Schedule, p. 5. \18\ See supra note 8. --------------------------------------------------------------------------- Further, the Exchange's proposed transaction fees for non-MIAX Market Makers in DIA, FB, GDX, SLV, USO, UVXY, and VXX are reasonable in order to ensure that the net transaction fees for non-MIAX Market Makers remain higher than Market Makers in a manner that is designed to encourage market participants to become members and register as Market Makers versus otherwise sending orders to the Exchange as a non-MIAX Market Maker in order to avoid a higher transaction fee. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange 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 proposal is designed to encourage an increase in Priority Customer orders in DIA, FB, GDX, SLV, USO, UVXY, and VXX options posted to the Exchange's Book in order to bring greater volume and liquidity, which benefit all market participants by providing more trading opportunities and tighter spreads. An increase in the submission of Priority Customer orders in DIA, FB, GDX, SLV, USO, UVXY, and VXX options on the Exchange's Book should result in an increase in competition for the opportunity to trade on the Exchange by, among other things, sending more orders and providing narrower and larger sized quotations in the effort to trade with such Priority Customer order flow. The resulting increased volume and liquidity will benefit non-Market Makers that do not pay the proposed fee and do not qualify for the marketing fee program at all, by providing more trading opportunities and tighter spreads. To the extent that there is additional competitive burden on market participants that are not Priority Customers or Market Makers or trading in other symbols, the Exchange believes that this is appropriate because the proposal should encourage Members to direct additional order flow to the Exchange and thus provide additional liquidity that enhances the quality of its markets and increases the volume of contracts traded on the Exchange. The Exchange believes that all of the Exchange's market participants will 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. The Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues if they deem fee levels at a particular venue to be excessive. In such an environment, the Exchange must continually adjust its fees to remain competitive with other exchanges and to attract order flow to the Exchange. The Exchange believes that the proposed rule change reflects this competitive environment because it establishes a fee structure in a manner that encourages market participants to direct their order flow, to provide liquidity, and to attract additional transaction volume to the Exchange. 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)(ii) of the Act,\19\ and Rule 19b-4(f)(2) \20\ 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. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. --------------------------------------------------------------------------- \19\ 15 U.S.C. 78s(b)(3)(A)(ii). \20\ 17 CFR 240.19b-4(f)(2). --------------------------------------------------------------------------- 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-MIAX-2016-28 on the subject line. Paper Comments Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-MIAX-2016-28. 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-MIAX- [[Page 60080]] 2016-28, and should be submitted on or before September 21, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\21\ --------------------------------------------------------------------------- \21\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2016-20894 Filed 8-30-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 169 / Wednesday, August 31, 2016 / Notices 60077
submission, all subsequent comments on the proposed rule change Market Makers for contracts executed as
amendments, all written statements from interested persons. a PRIME Agency Order, Contra-side
with respect to the proposed rule Order, Qualified Contingent Cross
I. Self-Regulatory Organization’s
change that are filed with the Order, PRIME Participating Quote or
Statement of the Terms of Substance of
Commission, and all written Order, or a PRIME AOC Response in the
the Proposed Rule Change
communications relating to the PRIME Auction, unless it executes
proposed rule change between the The Exchange is filing a proposal to against an unrelated order.
Commission and any person, other than amend the MIAX Options Fee Schedule (ii) an additional $0.12 per contract
those that may be withheld from the (the ‘‘Fee Schedule’’). Posted Liquidity Marketing Fee to all
public in accordance with the The text of the proposed rule change Market Makers for any standard options
provisions of 5 U.S.C. 552, will be is available on the Exchange’s Web site overlying EEM, GLD, IWM, QQQ, and
available for Web site viewing and at http://www.miaxoptions.com/filter/ SPY that Market Makers execute in their
printing in the Commission’s Public wotitle/rule_filing, at MIAX’s principal assigned class when the contra-party to
Reference Room, 100 F Street NE., office, and at the Commission’s Public the execution is a Priority Customer and
Washington, DC 20549, on official Reference Room. the Priority Customer order was posted
business days between the hours of II. Self-Regulatory Organization’s on the MIAX Book at the time of the
10:00 a.m. and 3:00 p.m. Copies of the Statement of the Purpose of, and execution. MIAX will not assess the
filing also will be available for Statutory Basis for, the Proposed Rule additional Posted Liquidity Marketing
inspection and copying at the principal Change Fee to Market Makers for contracts
office of the Exchange. All comments executed as a PRIME Agency Order,
In its filing with the Commission, the Contra-side Order, Qualified Contingent
received will be posted without change;
Exchange included statements Cross Order, or a PRIME AOC Response
the Commission does not edit personal
concerning the purpose of and basis for or PRIME Participating Quote or Order
identifying information from
the proposed rule change and discussed in the PRIME Auction. MIAX will also
submissions. You should submit only
any comments it received on the not assess the additional Posted
information that you wish to make
proposed rule change. The text of these Liquidity Marketing Fee to Market
available publicly. All submissions
statements may be examined at the Makers for contracts executed pursuant
should refer to File Number SR–Phlx–
places specified in Item IV below. The to a Liquidity Refresh Pause, route
2016–89 and should be submitted on or
Exchange has prepared summaries, set timer, or during the Opening Process.
before September 21, 2016.
forth in sections A, B, and C below, of This Posted Liquidity Marketing Fee is
For the Commission, by the Division of the most significant aspects of such
Trading and Markets, pursuant to delegated in addition to the current Marketing Fee
statements. of $0.25 per contract for standard
authority.17
Brent J. Fields, A. Self-Regulatory Organization’s options overlying these enumerated
Secretary. Statement of the Purpose of, and symbols that Market Makers execute in
Statutory Basis for, the Proposed Rule their assigned class when the contra-
[FR Doc. 2016–20960 Filed 8–30–16; 8:45 am]
Change party to the execution is a Priority
BILLING CODE 8011–01–P
Customer.4
1. Purpose Funds collected via the Marketing
The Exchange proposes to amend Fee, including the additional $0.12 per
SECURITIES AND EXCHANGE
Section 1)b) of the Fee Schedule, contract Posted Liquidity Marketing
COMMISSION
Marketing Fee, to add to the list of Fee, are put into ‘‘pools’’ controlled by
symbols for which the Exchange Primary Lead Market Makers
[Release No. 34–78681; File No. SR–MIAX– assesses a $0.12 per contract Posted (‘‘PLMMs’’) 5 and Lead Market Makers
2016–28] Liquidity Marketing Fee. In addition to (‘‘LMMs’’).6 So for example, the $0.12
the current symbols listed in Section per contract Posted Liquidity Marketing
Self-Regulatory Organizations; Miami
1)b), the Exchange is proposing to assess Fee goes into the broader Marketing Fee
International Securities Exchange LLC;
the Posted Liquidity Marketing Fee for pool for the Directed LMM or the PLMM
Notice of Filing and Immediate
contracts executed in DIA, FB, GDX,
Effectiveness of a Proposed Rule
SLV, USO, UVXY, and VXX. The 4 See Securities Exchange Act Release No. 73848
Change To Amend Its Fee Schedule (December 16, 2014), 79 FR 76421 (December 22,
Exchange also proposes to assess the
2014) (SR–MIAX–2014–62) (Notice of Filing and
August 25, 2016. applicable per contract non-Market Immediate Effectiveness of MIAX Posted Liquidity
Maker transaction fees for executions in Marketing Fee with respect to EEM, GLD, IWM,
Pursuant to the provisions of Section
these new symbols, as described more QQQ and SPY).
19(b)(1) of the Securities Exchange Act
fully below. 5 The term ‘‘Primary Lead Market Maker’’ means
of 1934 (‘‘Act’’),1 and Rule 19b–4 A Marketing Fee is assessed on a Lead Market Maker appointed by the Exchange to
thereunder,2 notice is hereby given that certain transactions of all Market act as the Primary Lead Market Maker for the
on August 11, 2016, Miami International purpose of making markets in securities traded on
Makers.3 Currently, Section 1) b) of the the Exchange. The Primary Lead Market Maker is
Securities Exchange LLC (‘‘MIAX’’ or Fee Schedule provides that the vested with the rights and responsibilities specified
‘‘Exchange’’) filed with the Securities Exchange will assess: in Chapter VI of these Rules with respect to Primary
and Exchange Commission (i) A Marketing Fee to all Market Lead Market Makers. See Exchange Rule 100.
(‘‘Commission’’) a proposed rule change Makers for contracts, including mini
6 The term ‘‘Lead Market Maker’’ means a
Member registered with the Exchange for the
mstockstill on DSK3G9T082PROD with NOTICES
as described in Items I, II, and III below, options, they execute in their assigned purpose of making markets in securities traded on
which Items have been prepared by the classes when the contra-party to the the Exchange and that is vested with the rights and
Exchange. The Commission is execution is a Priority Customer. MIAX responsibilities specified in Chapter VI of these
publishing this notice to solicit will not assess a Marketing Fee to
Rules with respect to Lead Market Makers. When
a Lead Market Maker is appointed to act in the
capacity of a Primary Lead Market Maker, the
17 17 CFR 200.30–3(a)(12). 3 See MIAX Fee Schedule, Section 1)b), entitled additional rights and responsibilities of a Primary
1 15 U.S.C. 78s(b)(1). ‘‘Marketing Fee’’ for more detail regarding the Lead Market Maker specified in Chapter VI of these
2 17 CFR 240.19b–4. Marketing Fee. Rules will apply. See Exchange Rule 100.
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![60080 Federal Register / Vol. 81, No. 169 / Wednesday, August 31, 2016 / Notices
2016–28, and should be submitted on or II. Self-Regulatory Organization’s to the limit price of an order, if
before September 21, 2016. Statement of the Purpose of, and applicable.5
Statutory Basis for, the Proposed Rule To reflect elimination of the sell
For the Commission, by the Division of
Change ‘‘plus’’ order instruction, the Exchange
Trading and Markets, pursuant to delegated
proposes to delete subsection (f)(4)(A) of
authority.21 In its filing with the Commission, the Rule 13, which defines the sell ‘‘plus’’
Robert W. Errett, self-regulatory organization included instruction, in its entirety. Subsection
Deputy Secretary. statements concerning the purpose of, (4)(B) of Rule 13(f), amended as
[FR Doc. 2016–20894 Filed 8–30–16; 8:45 am]
and basis for, the proposed rule change described below, would become new
and discussed any comments it received subsection (4)(A).
BILLING CODE 8011–01–P
on the proposed rule change. The text Second, the Exchange proposes to
of those statements may be examined at eliminate the buy ‘‘minus’’ order
SECURITIES AND EXCHANGE the places specified in Item IV below. instruction defined in Rule 13(f)(4)(B)
The Exchange has prepared summaries, and retain the ‘‘Buy Minus Zero Plus’’
COMMISSION
set forth in sections A, B, and C below, order. An order with a buy ‘‘minus’’
of the most significant parts of such instruction will not trade at a price that
[Release No. 34–78679; File No. SR–NYSE– statements. is higher than the last sale if the last sale
2016–59]
A. Self-Regulatory Organization’s was a ‘‘minus’’ or ‘‘zero minus’’ tick or
Self-Regulatory Organizations; New Statement of the Purpose of, and the that is higher than the last sale minus
York Stock Exchange LLC; Notice of Statutory Basis for, the Proposed Rule the minimum fractional change in the
Change stock if the last sale was a ‘‘plus’’ or
Filing and Immediate Effectiveness of
‘‘zero plus’’ tick, subject to the limit
Proposed Rule Change Amending Rule 1. Purpose price of an order, if applicable.6
13 To Eliminate Orders With a Sell Exchange rules would continue to
‘‘Plus’’ and Buy ‘‘Minus’’ Instruction The Exchange proposes to amend
Rule 13 to eliminate orders with a sell permit an order with a ‘‘Buy Minus Zero
and Retain Orders With a ‘‘Buy Minus Plus’’ instruction, which is currently a
Zero Plus’’ Instruction, and Make ‘‘plus’’ and buy ‘‘minus’’ instruction
and retain orders with a ‘‘Buy Minus sub-set of the instructions available
Conforming Changes to Rules 104, under Rule 13(f)(4)(B). A Buy Minus
Zero Plus’’ instruction, and make
107B, 123C and 1004 Zero Plus order instruction assists
conforming changes to Rules 104, 107B,
123C and 1004. The Exchange proposes member organizations with compliance
August 25, 2016.
to eliminate orders with a sell ‘‘plus’’ with the ‘‘safe harbor’’ provisions of
Pursuant to Section 19(b)(1) 1 of the and buy ‘‘minus’’ instruction for all Rule 10b–18 under the Act (‘‘Rule 10b–
Securities Exchange Act of 1934 (the securities both to streamline its rules 18’’) for issuer repurchases.7 One of the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 and reduce complexity among its order four provisions required to meet the safe
notice is hereby given that on August type offerings.4 harbor provision is if the purchase price
19, 2016, New York Stock Exchange of a security does not exceed the highest
Because of the technology changes
LLC (‘‘NYSE’’ or the ‘‘Exchange’’) filed independent bid or the last independent
associated with the proposed rule
with the Securities and Exchange transaction price.8 Because an order
change, the Exchange proposes to
Commission (the ‘‘Commission’’) the with a Buy Minus Zero Plus instruction
announce the implementation date of
proposed rule change as described in will not trade at a price that is higher
the elimination of the order types via
Items I and II below, which Items have than the last sale, member organizations
Trader Update.
been prepared by the self-regulatory can use this instruction to facilitate their
organization. The Commission is Elimination of Sell ‘‘Plus’’ and Buy compliance with at least one of the
‘‘Minus’’ Order Instructions (Rule 13) conditions of the safe harbor provision
publishing this notice to solicit
of Rule 10b–18.9
comments on the proposed rule change The Exchange proposes to eliminate, To reflect elimination of the buy
from interested persons. and thus delete from its rules, sell ‘‘minus’’ order instruction and retention
‘‘plus’’ and buy ‘‘minus’’ order of the ‘‘Buy Minus Zero Plus’’
I. Self-Regulatory Organization’s instructions, as defined in Rule
Statement of the Terms of Substance of instruction, the Exchange proposes to
13(f)(4)(A) and (B), respectively. Rule add ‘‘Zero Plus’’ after ‘‘buy minus’’ in
the Proposed Rule Change 13(f)(4)(B) would also be amended to the first sentence of proposed new Rule
retain a ‘‘Buy Minus Zero Plus’’ 13(f)(4)(A), capitalize ‘‘buy minus,’’ and
The Exchange proposes to (1) amend
instruction. delete the phrase ‘‘if the last sale was a
Rule 13 to eliminate orders with a sell
First, the Exchange proposes to ‘minus’ or ‘zero minus’ tick or that is
‘‘plus’’ and buy ‘‘minus’’ instruction
eliminate the sell ‘‘plus’’ order higher than the last sale minus the
and retain orders with a ‘‘Buy Minus
instruction. An order with a sell ‘‘plus’’ minimum fractional change in the stock
Zero Plus’’ instruction, and (2) make
instruction is an order that will not
conforming changes to Rules 104, 107B, trade at a price that is lower than the 5 See Rule 13(f)(4)(A).
123C and 1004. The proposed rule last sale if the last sale was a ‘‘plus’’ or 6 See Rule 13(f)(4)(B).
change is available on the Exchange’s ‘‘zero plus’’ tick or that is lower than the 7 See 17 CFR 240.10b–18.
Web site at www.nyse.com, at the last sale plus the minimum fractional 8 See 17 CFR 240.10b–18(b)(3). The other three
principal office of the Exchange, and at change in the stock if the last sale was conditions relate to time of purchases, volume of
mstockstill on DSK3G9T082PROD with NOTICES
the Commission’s Public Reference purchases, and a requirement that only one broker
a ‘‘minus’’ or ‘‘zero minus’’ tick, subject or dealer be involved in such repurchases on a
Room. single day.
4 See, e.g., Mary Jo White, Chair, Securities and 9 The Exchange does not represent that an order
21 17 CFR 200.30–3(a)(12). Exchange Commission, Speech at the Sandler with a Buy Minus Zero Plus instruction is
1 15 U.S.C. 78s(b)(1).
O’Neill & Partners, L.P. Global Exchange and guaranteed to meet the requirements of the safe
Brokerage Conference (June 5, 2014) (available at harbor provision of Rule 10b–18; rather, this
2 15 U.S.C. 78a.
www.sec.gov/News/Speech/Detail/Speech/ instruction is available to member organizations to
3 17 CFR 240.19b–4. 1370542004312#.U5HI-fmwJiw). facilitate their own compliance with Rule 10b–18.
VerDate Sep<11>2014 21:59 Aug 30, 2016 Jkt 238001 PO 00000 Frm 00105 Fmt 4703 Sfmt 4703 E:\FR\FM\31AUN1.SGM 31AUN1](https://thefederalregister.org/doc/81_FR_60246/page/4.svg)
Document Created: 2018-02-02 12:15:21
Document Modified: 2018-02-02 12:15:21
| 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 60077 |
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