81 FR 67408 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to the Fees Schedule
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 190 (September 30, 2016)
Federal Register Volume 81, Issue 190 (September 30, 2016)
| Page Range | 67408-67412 | |
| FR Document | 2016-23609 |
[Federal Register Volume 81, Number 190 (Friday, September 30, 2016)] [Notices] [Pages 67408-67412] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-23609] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-78930; File No. SR-CBOE-2016-070] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to the Fees Schedule September 26, 2016. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on September 22, 2016, Chicago Board Options Exchange, Incorporated (the ``Exchange'' or ``CBOE'') 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 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. --------------------------------------------------------------------------- [[Page 67409]] I. Self-Regulatory Organization's Statement of the Terms of the Substance of the Proposed Rule Change The Exchange seeks to amend its fees schedule. The text of the proposed rule change is available on the Exchange's Web site (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the Secretary, 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 its Fees Schedule, effective September 26, 2016. Specifically, the Exchange plans to list new options on two FTSE Russell indexes on September 26, 2016. More specifically, the Exchange proposes to establish fees for options that overlie the FTSE Emerging Markets Index (``FTEM''), which are schedule to be listed on September 26, 2016, and options that overlie the FTSE Developed Europe Index (``AWDE''), which are scheduled to be listed in the near future. By way of background, a specific set of proprietary products are commonly included or excluded from a variety of programs, qualification calculations and transaction fees. In lieu of listing out these products in various sections of the Fees Schedule, the Exchange uses the term ``Underlying Symbol List A'' to represent these products. Currently, Underlying Symbol List A is defined in Footnote 34 and represents the following proprietary products: OEX, XEO, RUT, RLG, RLV, RUI, FXTM, UKXM, SPX (including SPXw), SPXpm, SRO, VIX, VOLATILITY INDEXES and binary options. The Exchange notes that the reason the products in Underlying Symbol List A are often collectively included or excluded from certain programs, qualification calculations and transactions fees is because the Exchange has expended considerable resources developing and maintaining its proprietary, exclusively- listed products. Similar to the products currently represented by ``Underlying Symbol List A,'' AWDE and FTEM are not listed on any other exchange. As such, the Exchange proposes to exclude or include AWDE and FTEM in the same programs as the other products in Underlying Symbol List A, as well as add AWDE and FTEM to the definition of Underlying Symbol List A in Footnote 34. Specifically, like the other products in Underlying Symbol List A, the Exchange proposes to except AWDE and FTEM from the Liquidity Provider Sliding Scale, the Volume Incentive Program (VIP), the Marketing Fee, the Clearing Trading Permit Holder Fee Cap (``Fee Cap'') and exemption from fees for facilitation orders, and the Order Router Subsidy (ORS) and Complex Order Router Subsidy (CORS) Programs. Like all other products in Underlying Symbol List A (with the exception of SROs), the Exchange proposes to apply to AWDE and FTEM the CBOE Proprietary Products Sliding Scale. The Exchange does intend to keep AWDE and FTEM volume in the calculation of qualifying volume for the rebate of Floor Broker Trading Permit fees. The Exchange notes that although AWDE and FTEM are being added to ``Underlying Symbol List A'', it wishes to include AWDE and FTEM in the calculation of the qualifying volume for the rebate of Floor Broker Trading Permit fees. The Exchange wishes to continue to encourage Floor Brokers to execute open-outcry trades in these classes and believes that including them in the qualifying volume will provide such incentive. The Exchange next proposes to establish transaction fees for AWDE and FTEM. Particularly, the Exchange proposes to assess the same fees for AWDE and FTEM as apply to UKXM and FXTM options. Transaction fees for AWDE and FTEM options will be as follows (all listed rates are per contract): ------------------------------------------------------------------------ ------------------------------------------------------------------------ Customer................................................ $0.18 Clearing Trading Permit Holder Proprietary.............. 0.25 CBOE Market-Maker/DPM................................... 0.20 Joint Back-Office, Broker-Dealer, Non-Trading Permit 0.65 Holder Market-Maker, Professional/Voluntary Professional (non-AIM Electronic)...................... Joint Back-Office, Broker-Dealer, Non-Trading Permit 0.25 Holder Market-Maker, Professional/Voluntary Professional (Manual and AIM).......................... ------------------------------------------------------------------------ The Exchange also proposes to apply to AWDE and FTEM, like RUI, RLV, and RLG, and RUT, the Floor Brokerage Fee of $0.04 per contract ($0.02 per contract for crossed orders). The Exchange also proposes to apply to AWDE and FTEM the CFLEX Surcharge Fee of $0.10 per contract for all AWDE and FTEM orders executed electronically on CFLEX, capped at $250 per trade (i.e., first 2,500 contracts per trade). The CFLEX Surcharge Fee assists the Exchange in recouping the cost of developing and maintaining the CFLEX system. The Exchange notes that the CFLEX Surcharge Fee (and $250 cap) also applies to other proprietary index options, including products in Underlying Symbol List A. The Exchange currently assesses an Index License Surcharge for RUT of $0.45 per contract for all non-customer orders. Because the fees associated with the license for AWDE and FTEM are lower than the license fees for RUT, the Exchange proposes to assess a Surcharge of $0.10 per contract in order to recoup the costs associated with the AWDE and FTEM license. In order to promote and encourage trading of AWDE and FTEM, the Exchange proposes to waive all transaction fees (including the Floor Brokerage Fee, Index License Surcharge and CFLEX Surcharge Fee) for AWDE and FTEM transactions through December 31, 2016. In order to promote and encourage trading of UKXM, FXTM, RUI, RLV and RLG, the Exchange also proposes to extend the waiver of transaction fees (including the Floor Brokerage Fee, Index License Surcharge and CFLEX Surcharge Fee) for UKXM, FXTM, RUI, RLV and RLG. The Exchange proposes to amend Footnote 40 to the Fees Schedule to make clear that transaction fees for AWDE, FTEM, RUI, RLV, RLG, UKXM and FXTM will be waived through December 31, 2016. The Exchange is also offering a compensation plan to the Designated [[Page 67410]] Primary Market-Maker(s) (``DPM(s)'') appointed in AWDE and FTEM to offset the initial DPM costs. The Exchange proposes to add AWDE and FTEM to Footnote 43 to the Fees Schedule, which currently provides that DPM(s) appointed for an entire month in either FXTM or UKXM will receive a payment of $7,500 per class per month through December 31, 2016. Because AWDE and FTEM are scheduled to be listed on September 26, 2016, the appointed DPM(s) will not have an appointment in AWDE and FTEM for the entire month of September; thus, the DPM(s) will not receive compensation for September 2016. The DPM(s) appointed for the entire month of October, November, etc. will receive compensation of $7,500 for each entire month the DPM is appointed in AWDE and FTEM through December 31, 2016. 2. Statutory Basis The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the ``Act'') and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.\3\ Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) \4\ requirements that the rules of an exchange be 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 regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. Additionally, the Exchange believes the proposed rule change is consistent with Section 6(b)(4) of the Act,\5\ which requires that Exchange rules provide for the equitable allocation of reasonable dues, fees, and other charges among its Trading Permit Holders and other persons using its facilities. --------------------------------------------------------------------------- \3\ 15 U.S.C. 78f(b). \4\ 15 U.S.C. 78f(b)(5). \5\ 15 U.S.C. 78f(b)(4). --------------------------------------------------------------------------- Particularly, the Exchange believes it is reasonable to charge different fee amounts to different user types in the manner proposed because the proposed fees are consistent with the price differentiation that exists today for other index products, including RUT, RUI, RLV, and RLG. The Exchange also believes that the proposed fee amounts for AWDE and FTEM orders are reasonable because the proposed fee amounts are the same already assessed for similar products (e.g., RUT, RUI, RLV, and RLG), as well as are within the range of amounts assessed for the Exchange's other proprietary products.\6\ --------------------------------------------------------------------------- \6\ See CBOE Fees Schedule, Specified Proprietary Index Options Rate Table. --------------------------------------------------------------------------- The Exchange believes that it is equitable and not unfairly discriminatory to assess lower fees to Customers as compared to other market participants because Customer order flow enhances liquidity on the Exchange for the benefit of all market participants. Specifically, customer liquidity benefits all market participants by providing more trading opportunities, which attracts Market-Makers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants. The fees offered to customers are intended to attract more customer trading volume to the Exchange. Moreover, the options industry has a long history of providing preferential pricing to Customers, and the Exchange's current Fees Schedule currently does so in many places, as do the fees structures of many other exchanges. Finally, all fee amounts listed as applying to Customers will be applied equally to all Customers (meaning that all Customers will be assessed the same amount). The Exchange believes that it is equitable and not unfairly discriminatory to, assess lower fees to Market-Makers as compared to other market participants other than Customers because Market-Makers, unlike other market participants, take on a number of obligations, including quoting obligations, that other market participants do not have. Further, these lower fees offered to Market-Makers are intended to incent Market-Makers to quote and trade more on the Exchange, thereby providing more trading opportunities for all market participants. Additionally, the proposed fee for Market-Makers will be applied equally to all Market-Makers (meaning that all Market-Makers will be assessed the same amount). This concept also applies to orders from all other origins. It should also be noted that all fee amounts described herein are intended to attract greater order flow to the Exchange in AWDE and FTEM which should therefore serve to benefit all Exchange market participants. Similarly, it is equitable and not unfairly discriminatory to assess lower fees to Clearing Trading Permit Holder Proprietary orders than those of other market participants (except Customers and Market-Makers) because Clearing Trading Permit Holders also have a number of obligations (such as membership with the Options Clearing Corporation), significant regulatory burdens, and financial obligations, that other market participants do not need to take on. The Exchange also notes that the AWDE and FTEM fee amounts for each separate type of market participant will be assessed equally to all such market participants (i.e. all Broker-Dealer orders will be assessed the same amount, all Joint Back-Office orders will be assessed the same amount, etc.). The Exchange believes the proposed AIM transaction fees for Brokers Dealers, Non-Trading Permit Holder Market-Makers, Professionals/ Voluntary Professionals, JBOs and Customers are reasonable because the amounts are still lower than assessed for AIM transactions in other proprietary products.\7\ The Exchange believes it's equitable and not unfairly discriminatory to assess lower fees for AIM executions as compared to electronic executions because AIM is a price-improvement mechanism, which the Exchange wishes to encourage and support. --------------------------------------------------------------------------- \7\ Id. --------------------------------------------------------------------------- Assessing the Floor Brokerage Fee of $0.04 per contract for non- crossed orders and $0.02 per contract for crossed orders to Floor Brokers (and not other market participants) trading AWDE and FTEM orders is equitable and not unfairly discriminatory because only Floor Brokers are statutorily capable of representing orders in the trading crowd, for which they charge a commission. Moreover, this fee is already assessed, in the same amounts, to the other products in Underlying Symbol List A, including UKXM, FXTM, RUT, RUI, RLV, and RLG. The Exchange believes that assessing an Index License Surcharge Fee of $0.10 per contract to AWDE and FTEM transactions is reasonable because the Surcharge helps recoup some of the costs associated with the license for AWDE and FTEM options. Additionally, the Exchange notes that the Surcharge amount is the same as, and in some cases lower than, the amount assessed as an Index License Surcharge to other index products. The proposed Surcharge is also equitable and not unfairly discriminatory because the amount will be assessed to all market participants to whom the Surcharge applies. Not applying the AWDE and FTEM Index License Surcharge Fee to Customer orders is equitable and not [[Page 67411]] unfairly discriminatory because this is designed to attract Customer AWDE and FTEM orders, which increases liquidity and provides greater trading opportunities to all market participants. Additionally, it is equitable and not unfairly discriminatory to assess a lower License Index Surcharge amount to AWDE and FTEM transactions as compared to RUT transactions because the costs of the license associated with RUT is greater. Similarly, the Exchange believes assessing a CFLEX Surcharge Fee of $0.10 per contract for all AWDE and FTEM orders executed electronically on CFLEX and capping it at $250 (i.e., first 2,500 contracts per trade) is reasonable because it is the same amount currently charged to other proprietary index products for the same transactions.\8\ The proposed Surcharge is also equitable and not unfairly discriminatory because the amount will be assessed to all market participants to whom the CFLEX Surcharge applies. --------------------------------------------------------------------------- \8\ See CBOE Fees Schedule, Index Options Rate Table--All Index Products Excluding Underlying Symbol List A, CFLEX Surcharge Fee and Specified Proprietary Index Options Rate Table--Underlying Symbol List A, CFLEX Surcharge Fee. --------------------------------------------------------------------------- Excepting AWDE and FTEM from the Liquidity Provider Sliding Scale, VIP, the Marketing Fee, the Fee Cap, and the exemption from fees for facilitation orders and the ORS and CORS Programs is reasonable because other Underlying Symbol List A products (i.e., other products that are exclusively-listed) are excepted from those same items. This is equitable and not unfairly discriminatory for the same reason; it seems equitable to except AWDE and FTEM from items on the Fees Schedule from which other proprietary products are also excepted. The Exchange believes it is reasonable, equitable and not unfairly discriminatory to waive all transaction fees, including the Floor Brokerage fee, the License Index Surcharge and CFLEX Surcharge Fee because it promotes and encourages trading of these new products and applies to all Trading Permit Holders (``TPHs''). Applying to AWDE and FTEM to the CBOE Proprietary Products Sliding Scale is reasonable because it also applies to other Underlying Symbol List A products. This is equitable and not unfairly discriminatory for the same reason; it seems equitable to apply to AWDE and FTEM the same items on the Fees Schedule that apply to Underlying Symbol List A options classes (i.e., proprietary options classes that are not listed on other exchanges). The Exchange believes it's reasonable, equitable and not unfairly discriminatory to continue to include AWDE and FTEM in the calculation of the qualifying volume for the Floor Broker Trading Permit Fees rebate because the Exchange wishes to support and encourage open-outcry trading of AWDE and FTEM, which allows for price improvement and has a number of positive impacts on the market system. Finally, the Exchange believes that it is equitable and not unfairly discriminatory to compensate DPM(s) that are appointed for an entire month in either AWDE and FTEM. DPM(s) incur costs when receiving an appointment, and in the case of AWDE and FTEM, the Exchange believes it is appropriate to provide compensation to the DPM(s) to offset those costs. B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule changes will impose any burden on competition that are 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 intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because, while different fees are assessed to different market participants in some circumstances, these different market participants have different obligations and different circumstances as discussed above. For example, Market-Makers have quoting obligations that other market participants do not have. The Exchange does not believe that the proposed rule change to waive all transaction fees through December 31, 2016 will impose any burden on intramarket competition because it applies to all TPHs and encourages trading in these new products. The Exchange does not believe that the proposed rule changes will impose any burden on intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because AWDE and FTEM will be exclusively listed on CBOE. To the extent that the proposed changes make CBOE a more attractive marketplace for market participants at other exchanges, such market participants are welcome to become CBOE market participants. C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act \9\ and paragraph (f) of Rule 19b-4 \10\ 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 will institute proceedings to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \9\ 15 U.S.C. 78s(b)(3)(A). \10\ 17 CFR 240.19b-4(f). --------------------------------------------------------------------------- IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic 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-CBOE-2016-070 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-CBOE-2016-070. 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 [[Page 67412]] 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-CBOE-2016-070, and should be submitted on or before October 21, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\11\ --------------------------------------------------------------------------- \11\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Brent J. Fields, Secretary. [FR Doc. 2016-23609 Filed 9-29-16; 8:45 am] BILLING CODE 8011-01-P
![67408 Federal Register / Vol. 81, No. 190 / Friday, September 30, 2016 / Notices
and by removing the CPDA option, the change that are filed with the approving the proposed rule change, as
proposed rule change, as modified by Commission, and all written modified by Amendment No. 1, on an
Amendment No. 1, will establish a communications relating to the accelerated basis, pursuant to Section
process that will streamline Cover of proposed rule change between the 19(b)(2) of the Act.19
Protect transactions, allocations, and Commission and any person, other than
recordkeeping for Participants. Further, those that may be withheld from the V. Conclusion
as DTC explains in the Notice, the public in accordance with the On the basis of the foregoing, the
proposed rule change, as modified by provisions of 5 U.S.C. 552, will be Commission finds that the proposal, as
Amendment No. 1, will reduce for DTC available for Web site viewing and modified by Amendment No. 1, is
the risks, burdens, and costs associated printing in the Commission’s Public consistent with the requirements of the
with its current processing of such Reference Room, 100 F Street NE., Act and in particular with the
transactions. Therefore, adding the Washington, DC 20549 on official requirements of Section 17A of the
CPAP option and removing the CPDA business days between the hours of Act 20 and the rules and regulations
option will promote the prompt and 10:00 a.m. and 3:00 p.m. Copies of the thereunder.
accurate clearance and settlement of filing also will be available for
securities, consistent with the inspection and copying at the principal It is therefore ordered, pursuant to
requirements of the Act, in particular office of DTC and on DTCC’s Web site Section 19(b)(2) of the Act, that
Section 17A(b)(3)(F), cited above. (http://dtcc.com/legal/sec-rule- proposed rule change SR–DTC–2016–
As the proposed rule change pertains filings.aspx). All comments received 005, as modified by Amendment No. 1,
to technical changes to the Procedures, will be posted without change; the be, and hereby is, APPROVED on an
the Commission finds the technical Commission does not edit personal accelerated basis.21
changes also consistent with Section identifying information from For the Commission, by the Division of
17A(b)(3)(F) of the Act 17 because submissions. You should submit only Trading and Markets, pursuant to delegated
technical updates to the Procedures to information that you wish to make authority.22
make them more clear, consistent, and available publicly. All submissions Brent J. Fields,
current for Participants that rely on the should refer to File Number SR–DTC– Secretary.
Procedures support the prompt and 2016–005 and should be submitted on [FR Doc. 2016–23615 Filed 9–29–16; 8:45 am]
accurate clearance and settlement of or before October 21, 2016.
BILLING CODE 8011–01–P
securities transactions. IV. Accelerated Approval of the
III. Solicitation of Comments on Proposed Rule Change, as Modified by
Amendment No. 1 Amendment No. 1 SECURITIES AND EXCHANGE
The Commission, pursuant to Section COMMISSION
Interested persons are invited to
submit written data, views, and 19(b)(2) of the Act,18 finds good cause
arguments concerning Amendment No. to approve the proposed rule change, as [Release No. 34–78930; File No. SR–CBOE–
1 to File Number SR–DTC–2016–005, modified by Amendment No. 1, prior to 2016–070]
including whether Amendment No. 1 is the thirtieth day after the date of
publication of Amendment No. 1 in the Self-Regulatory Organizations;
consistent with the Act. Comments may
Federal Register. In Amendment No.1, Chicago Board Options Exchange,
be submitted by any of the following
DTC clarifies that when a Participant Incorporated; Notice of Filing and
methods:
submits a Protect directly to the Offer Immediate Effectiveness of a Proposed
Electronic Comments Agent, such Participant could still Rule Change Relating to the Fees
• Use the Commission’s Internet request that DTC process the Cover. As Schedule
comment form (http://www.sec.gov/ such, Amendment No. 1 proposes to set September 26, 2016.
rules/sro.shtml); or forth in the Guide that, once a
• Send an email to rule-comments@ Participant has accepted an Offer Pursuant to Section 19(b)(1) of the
sec.gov. Please include File Number SR– through the Offer Agent via a hard copy Securities Exchange Act of 1934 (the
DTC–2016–005 on the subject line. Notice of Guaranteed Delivery ‘‘Act’’),1 and Rule 19b–4 thereunder,2
submitted directly to the Offer Agent, a notice is hereby given that on
Paper Comments September 22, 2016, Chicago Board
Participant would need to either (a)
• Send paper comments in triplicate submit the Cover directly to the Offer Options Exchange, Incorporated (the
to Secretary, Securities and Exchange Agent, or (b) request that DTC manually ‘‘Exchange’’ or ‘‘CBOE’’) filed with the
Commission, 100 F Street NE., process the Cover, but not through Securities and Exchange Commission
Washington, DC 20549. PTOP/PSOP. (the ‘‘Commission’’) the proposed rule
All submissions should refer to File As discussed more fully above, the change as described in Items I, II, and
Number SR–DTC–2016–005. This file Commission finds that the proposed III below, which Items have been
number should be included on the rule change, as modified by Amendment prepared by the Exchange. The
subject line if email is used. To help the No. 1, will streamline DTC’s processing Commission is publishing this notice to
Commission process and review your of Cover of Protect transactions and solicit comments on the proposed rule
comments more efficiently, please use reduce for DTC the risks, burdens, and change from interested persons.
only one method. The Commission will costs associated with its current
post all comments on the Commission’s processing of such transactions, thereby
mstockstill on DSK3G9T082PROD with NOTICES
19 Id.
Internet Web site (http://www.sec.gov/ promoting the prompt and accurate 20 15 U.S.C. 78q–1.
21 In approving the proposed rule change, the
rules/sro.shtml). Copies of the clearance and settlement of securities,
Commission considered the proposal’s impact on
submission, all subsequent consistent with Section 17A(b)(3)(F), efficiency, competition, and capital formation. 15
amendments, all written statements cited above. Accordingly, the U.S.C. 78c(f).
with respect to the proposed rule Commission finds good cause for 22 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
17 Id. 18 15 U.S.C. 78s(b)(2). 2 17 CFR 240.19b–4.
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![67412 Federal Register / Vol. 81, No. 190 / Friday, September 30, 2016 / Notices
Reference Room, 100 F Street NE., threshold that Equity Trading Permit and an Explanatory Note 1 which will
Washington, DC 20549 on official (‘‘ETP’’) Holders 3 will be required to create two different price structures
business days between the hours of meet to continue to pay for [sic] the depending on the amount of liquidity
10:00 a.m. and 3:00 p.m. Copies of such current liquidity-taking fee in securities that an ETP Holder adds on the
filing also will be available for priced $1.00 or greater and establish a Exchange. Specifically, the Exchange
inspection and copying at the principal different, higher liquidity-taking fee for will charge the current ‘‘taker’’ fee of
office of the Exchange. All comments ETP Holders that do not meet the new $0.0003 per executed share for any
received will be posted without change; volume threshold; and (2) make marketable liquidity-removing order in
the Commission does not edit personal ministerial changes to the Fee Schedule. securities priced at $1.00 or greater to
identifying information from The text of the proposed rule change any ETP Holder that executes at least
submissions. You should submit only is available on the Exchange’s Web site 50,000 shares of liquidity-adding
information that you wish to make at http://www.nsx.com, at the principal volume during a calendar month. An
available publicly. All submissions office of the Exchange, and at the ETP Holder that does not execute at
should refer to File Number SR–CBOE– Commission’s Public Reference Room. least 50,000 shares of liquidity-adding
2016–070, and should be submitted on volume during a calendar month will be
or before October 21, 2016. II. Self-Regulatory Organization’s charged $0.0030 per executed share for
Statement of the Purpose of, and any liquidity-removing order in
For the Commission, by the Division of Statutory Basis for, the Proposed Rule
Trading and Markets, pursuant to delegated securities priced at $1.00 or greater.
authority.11
Change After each calendar month, the
Brent J. Fields, In its filing with the Commission, the Exchange will calculate the number of
Secretary. Exchange included statements shares of liquidity-adding volume that
[FR Doc. 2016–23609 Filed 9–29–16; 8:45 am] concerning the purpose of and basis for each ETP Holder executed and apply
BILLING CODE 8011–01–P
the proposed rule change and discussed the appropriate fee for the ETP Holder’s
any comments it received on the liquidity-taking executions that calendar
proposed rule change. The text of these month.
SECURITIES AND EXCHANGE statements may be examined at the The Exchange also proposes to make
COMMISSION places specified in Item IV below. The the ministerial change of adjusting the
Exchange has prepared summaries, set numbering for Explanatory Notes in
[Release No. 34–78931; File No. SR–NSX– forth in sections A, B, and C below, of light of the addition of proposed
2016–11]
the most significant parts of such Explanatory Note 1.
Self-Regulatory Organizations; statements. Pursuant to Exchange Rule 16.1(c),
National Stock Exchange, Inc.; Notice the Exchange will ‘‘provide ETP Holders
A. Self-Regulatory Organization’s with notice of all relevant dues, fees,
of Filing and Immediate Effectiveness Statement of the Purpose of, and
of Proposed Rule Change To Amend assessments and charges of the
Statutory Basis for, the Proposed Rule Exchange’’ through the issuance of an
the Fee and Rebate Schedule To Change
Create a Liquidity-Adding Volume Information Circular and will post the
Threshold To Benefit From the Current 1. Purpose Fee Schedule and the instant rule filing
Liquidity Taking Fee in Securities on the Exchange’s Web site,
The Exchange proposes to amend its
Priced $1.00 or Greater www.nsx.com.
Fee Schedule, issued pursuant to Rule
16.1, with the goal of maximizing the 2. Statutory Basis
September 26, 2016.
effectiveness of its business model and The Exchange believes that the
Pursuant to Section 19(b)(1) of the
continuing to provide ETP Holders a proposed rule change is consistent with
Securities Exchange Act of 1934 (the
cost-effective execution venue. To the provisions of Section 6(b) of the
‘‘Act’’) 1 and Rule 19b–4 thereunder,2
further incentivize ETP Holders to post Act,5 in general and, in particular,
notice is hereby given that on
liquidity on the NSX Book,4 the Section 6(b)(4) of the Act,6 which
September 20, 2016, National Stock
Exchange is proposing to create a requires that the rules of a national
Exchange, Inc. (‘‘NSX’’ or the
monthly, liquidity-adding volume securities exchange provide for the
‘‘Exchange’’) filed with the Securities
threshold that an ETP Holder must equitable allocation of reasonable dues,
and Exchange Commission
reach to continue to pay the current fees, and other charges among its
(‘‘Commission’’) the proposed rule
liquidity-taking fee for securities priced members and issuers and other persons
change, as described in Items I, II, and
$1.00 or greater. The Exchange proposes using its facilities. The proposed rule
III below, which Items have been
to adopt a different, higher liquidity- change is also consistent with Section
prepared by the Exchange. The
taking fee for ETP Holders that do not 6(b)(5) of the Act,7 which requires,
Commission is publishing this notice to
meet the new liquidity-adding volume among other things, that the rules of a
solicit comments on the proposed rule
threshold. national securities exchange not permit
change from interested persons.
Currently, the Exchange charges ETP unfair discrimination between
I. Self-Regulatory Organization’s Holders $0.0003 per share executed for customers, issuers, brokers, or dealers,
Statement of the Terms of Substance of liquidity-taking orders in symbols and be designed to promote just and
the Proposed Rule Change priced at $1.00 or greater. The Exchange equitable principles of trade, to remove
The Exchange is proposing to amend proposes to amend its fee schedule to impediments to and perfect the
add language in the Transaction Fees
mstockstill on DSK3G9T082PROD with NOTICES
its Fee and Rebate Schedule (the ‘‘Fee mechanism of a free and open market
Schedule’’), issued pursuant to and Rebates section of the Fee Schedule and a national market system.
Exchange Rule 16.1, to: (1) Create a The Exchange submits that the
3 Exchange Rule 1.5E(1) defines ‘‘ETP’’ as the
monthly, liquidity-adding volume Equity Trading Permit issued by the Exchange for
proposed liquidity-adding volume
effecting approved securities transactions on the
11 17 CFR 200.30–3(a)(12). 5 15 U.S.C. 78f(b).
Exchange’s trading facilities.
1 15 U.S.C. 78s(b)(1). 4 Exchange Rule 1.5N(1) defines ‘‘NSX Book’’ as 6 15 U.S.C. 78f(b)(4).
2 17 CFR 240.19b–4. the trading systems’ electronic file of orders. 7 15 U.S.C. 78f(b)(5).
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Document Created: 2018-02-09 13:34:19
Document Modified: 2018-02-09 13:34:19
| 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 67408 |
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