81 FR 7171 - Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fee Schedule To Lower Certain Fees for Non-Auction Transactions on the BOX Market LLC (“BOX”) Options Facility

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 27 (February 10, 2016)

Page Range		7171-7172
FR Document		2016-02607
Federal Register, Volume 81 Issue 27 (Wednesday, February 10, 2016)
[Federal Register Volume 81, Number 27 (Wednesday, February 10, 2016)]
[Notices]
[Pages 7171-7172]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-02607]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77055; File No. SR-BOX-2016-02]


Self-Regulatory Organizations; BOX Options Exchange LLC; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change To 
Amend the Fee Schedule To Lower Certain Fees for Non-Auction 
Transactions on the BOX Market LLC (``BOX'') Options Facility

February 4, 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 January 27, 2016, BOX Options Exchange LLC (the ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I, II, and III below, which 
Items have been prepared by the Exchange. The Exchange filed the 
proposed rule change pursuant to Section 19(b)(3)(A)(ii) of the Act,\3\ 
and Rule 19b-4(f)(2) thereunder,\4\ which renders the proposal 
effective upon filing with the Commission. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    The Exchange is filing with the Securities and Exchange Commission 
(``Commission'') a proposed rule change to amend the Fee Schedule to 
lower certain fees for Non-Auction transactions on the BOX Market LLC 
(``BOX'') options facility. While changes to the fee schedule pursuant 
to this proposal will be effective upon filing, the changes will become 
operative on February 1, 2016. The text of the proposed rule change is 
available from the principal office of the Exchange, at the 
Commission's Public Reference Room and also on the Exchange's Internet 
Web site at http://boxexchange.com.

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 make changes to Section I.A. of the BOX 
Fee Schedule, Exchange Fees for Non-Auction Transactions.
    Specifically, the Exchange proposes to amend certain fees in the 
pricing model outlined in Section I.A. (Non-Auction Transactions).\5\ 
In this section, fees and credits are assessed depending on upon three 
factors: (i) The account type of the Participant submitting the order; 
(ii) whether the Participant is a liquidity provider or liquidity 
taker; and (iii) the account type of the contra party. Non-Auction 
Transactions in Penny Pilot Classes are assessed different fees or 
credits than Non-Auction Transactions in Non-Penny Pilot Classes.
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    \5\ Non-Auction Transactions are those transactions executed on 
the BOX Book.
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    Specifically, the Exchange proposes to reduce the Taker fees for 
Professional Customers, Broker Dealers and Market Makers interacting 
with Public Customers in Penny Pilot Classes. The fee for Professional 
Customers and Broker Dealers taking liquidity against Public Customers 
will be lowered to $0.50 from $0.64 and the fee for Market Makers 
taking liquidity against Public Customers will be lowered to $0.50 from 
$0.55.
    These transactions will remain exempt from the Liquidity Fees and 
Credits outlined in Section II of the BOX Fee Schedule. The revised fee 
structure for Non-Auction Transactions will be as follows:

----------------------------------------------------------------------------------------------------------------
                                                        Penny pilot classes           Non-penny pilot classes
         Account type             Contra party   ---------------------------------------------------------------
                                                     Maker fee       Taker fee       Maker fee       Taker fee
----------------------------------------------------------------------------------------------------------------
Public Customer...............  Public Customer.           $0.00           $0.00           $0.00           $0.00
                                Professional                0.00            0.00            0.00            0.00
                                 Customer/Broker
                                 Dealer.
                                Market Maker....            0.00            0.00            0.00            0.00
Professional Customer or        Public Customer.            0.60            0.50            0.95            1.07
 Broker Dealer.
                                Professional                0.25            0.40            0.35            0.40
                                 Customer/Broker
                                 Dealer.
                                Market Maker....            0.25            0.44            0.35            0.44
Market Maker..................  Public Customer.            0.51            0.50            0.85            1.03
                                Professional                0.00            0.05            0.00            0.10
                                 Customer/Broker
                                 Dealer.
                                Market Maker....            0.00            0.29            0.00            0.29
----------------------------------------------------------------------------------------------------------------


[[Page 7172]]

    The Exchange also proposes to make non-substantive technical 
chances [sic] to Section I.A. of the BOX Fee Schedule (Non-Auction 
Transactions) and remove references to credits.
2. Statutory Basis
    The Exchange believes that the proposal is consistent with the 
requirements of Section 6(b) of the Act, in general, and Section 
6(b)(4) and 6(b)(5) of the Act,\6\ in particular, in that it provides 
for the equitable allocation of reasonable dues, fees, and other 
charges among BOX Participants and other persons using its facilities 
and does not unfairly discriminate between customers, issuers, brokers 
or dealers. The proposed changes will allow the Exchange to be 
competitive with other exchanges and to apply fees and credits [sic] in 
a manner that is equitable among all BOX Participants. Further, the 
Exchange operates within a highly competitive market in which market 
participants can readily direct order flow to any other competing 
exchange if they determine fees at a particular exchange to be 
excessive.
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78f(b)(4) and (5).
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    The Exchange believes it is equitable, reasonable and not unfairly 
discriminatory to assess fees according to the account type of the 
Participant originating the order and the contra party. This fee 
structure has been in place on the Exchange for some time and the 
Exchange is simply adjusting certain credits [sic] within the 
structure.\7\ The result of this structure is that a Participant does 
not know the fee it will be charged when submitting certain orders. 
Therefore, the Participant must recognize that it could be charged the 
highest applicable fee on the Exchange's schedule, which may, instead, 
be lowered or changed to a credit depending upon how the order 
interacts.
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    \7\ See Securities Exchange Act Release No. 73547 (November 6, 
2014), 79 FR 67520 (November 13, 2014) (Notice of Filing and 
Immediate Effectiveness of SR-BOX-2014-25).
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    The Exchange believes the proposed fees for Non-Auction [sic] for 
Professional Customers, Broker Dealers and Market Makers when taking 
liquidity against Public Customers are reasonable, equitable and not 
unfairly discriminatory. The Exchange believes these fees are 
reasonable as they are in line with the current fees assessed by other 
competing exchanges.\8\
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    \8\ Miami Securities International Exchange, LLC (``MIAX'') 
charges $0.45 to firms and $0.47 to non-MIAX market makers, broker 
dealers and public customers other than priority customers for 
execution in Penny Pilot issues and NASDAQ OMX PHLX LLC (``PHLX'') 
charges $0.48 to professional customers, broker dealers and firms 
for execution in Penny Pilot issues. In addition, NASDAQ Options 
Market LLC (``NOM'') and BATS BZX Exchange (``BATS'') charge a $0.50 
take fee for removing liquidity in Penny Pilot issues.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange believes that the 
proposed adjustments to fees and rebates [sic] in the Non-Auction 
Transactions fee structure will not impose a burden on competition 
among various Exchange Participants. Rather, BOX believes that the 
changes will result in the Participants being charged appropriately for 
these transactions and are designed to enhance competition in Non-
Auction transactions on BOX. Submitting an order is entirely voluntary 
and Participants can determine which type of order they wish to submit, 
if any, to the Exchange. Further, the Exchange believes that this 
proposal will enhance competition between exchanges because it is 
designed to allow the Exchange to better compete with other exchanges 
for order flow.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or 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 Exchange Act \9\ and Rule 19b-4(f)(2) 
thereunder,\10\ because it establishes or changes a due, or fee.
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    \9\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \10\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend the rule 
change if it appears to the Commission that the action is necessary or 
appropriate in the public interest, for the protection of investors, or 
would otherwise further 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.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-BOX-2016-02 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-BOX-2016-02. 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-BOX-2016-02, and should be 
submitted on or before March 2, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-02607 Filed 2-9-16; 8:45 am]
 BILLING CODE 8011-01-P
Federal Register / Vol. 81, No. 27 / Wednesday, February 10, 2016 / Notices 7171

printing in the Commission’s Public Securities and Exchange Commission Exchange has prepared summaries, set
Reference Room, 100 F Street NE., (‘‘Commission’’) the proposed rule forth in Sections A, B, and C below, of
Washington, DC 20549, on official change as described in Items I, II, and the most significant aspects of such
business days between the hours of III below, which Items have been statements.
10:00 a.m. and 3:00 p.m. Copies of such prepared by the Exchange. The
A. Self-Regulatory Organization’s
filing will also be available for Exchange filed the proposed rule change
inspection and copying at the principal Statement of the Purpose of, and
pursuant to Section 19(b)(3)(A)(ii) of the
office of the Exchange. All comments Statutory Basis for, the Proposed Rule
Act,3 and Rule 19b–4(f)(2) thereunder,4
received will be posted without change; Change
which renders the proposal effective
the Commission does not edit personal upon filing with the Commission. The 1. Purpose
identifying information from Commission is publishing this notice to
submissions. You should submit only The Exchange proposes to make
solicit comments on the proposed rule
information that you wish to make changes to Section I.A. of the BOX Fee
change from interested persons.
available publicly. All submissions Schedule, Exchange Fees for Non-
should refer to File No. SR–Phlx–2016– I. Self-Regulatory Organization’s Auction Transactions.
10 and should be submitted on or before Statement of the Terms of the Substance Specifically, the Exchange proposes to
March 2, 2016. of the Proposed Rule Change amend certain fees in the pricing model
The Exchange is filing with the outlined in Section I.A. (Non-Auction
For the Commission, by the Division of
Securities and Exchange Commission Transactions).5 In this section, fees and
Trading and Markets, pursuant to delegated
authority.25 (‘‘Commission’’) a proposed rule change credits are assessed depending on upon
Robert W. Errett, to amend the Fee Schedule to lower three factors: (i) The account type of the
certain fees for Non-Auction Participant submitting the order; (ii)
Deputy Secretary.
transactions on the BOX Market LLC whether the Participant is a liquidity
[FR Doc. 2016–02606 Filed 2–9–16; 8:45 am]
(‘‘BOX’’) options facility. While changes provider or liquidity taker; and (iii) the
BILLING CODE 8011–01–P
to the fee schedule pursuant to this account type of the contra party. Non-
proposal will be effective upon filing, Auction Transactions in Penny Pilot
the changes will become operative on Classes are assessed different fees or
SECURITIES AND EXCHANGE
February 1, 2016. The text of the credits than Non-Auction Transactions
COMMISSION
proposed rule change is available from in Non-Penny Pilot Classes.
[Release No. 34–77055; File No. SR–BOX– the principal office of the Exchange, at Specifically, the Exchange proposes to
2016–02] reduce the Taker fees for Professional
the Commission’s Public Reference
Room and also on the Exchange’s Customers, Broker Dealers and Market
Self-Regulatory Organizations; BOX
Internet Web site at http:// Makers interacting with Public
Options Exchange LLC; Notice of
boxexchange.com. Customers in Penny Pilot Classes. The
Filing and Immediate Effectiveness of
fee for Professional Customers and
a Proposed Rule Change To Amend II. Self-Regulatory Organization’s Broker Dealers taking liquidity against
the Fee Schedule To Lower Certain Statement of the Purpose of, and Public Customers will be lowered to
Fees for Non-Auction Transactions on Statutory Basis for, the Proposed Rule $0.50 from $0.64 and the fee for Market
the BOX Market LLC (‘‘BOX’’) Options Change Makers taking liquidity against Public
Facility
In its filing with the Commission, the Customers will be lowered to $0.50 from
February 4, 2016. Exchange included statements $0.55.
Pursuant to Section 19(b)(1) of the concerning the purpose of and basis for These transactions will remain
Securities Exchange Act of 1934 (the the proposed rule change and discussed exempt from the Liquidity Fees and
‘‘Act’’),1 and Rule 19b–4 thereunder,2 any comments it received on the Credits outlined in Section II of the BOX
notice is hereby given that on January proposed rule change. The text of these Fee Schedule. The revised fee structure
27, 2016, BOX Options Exchange LLC statements may be examined at the for Non-Auction Transactions will be as
(the ‘‘Exchange’’) filed with the places specified in Item IV below. The follows:

Penny pilot classes Non-penny pilot classes
Account type Contra party
Maker fee Taker fee Maker fee Taker fee

Public Customer ............................... Public Customer ............................... $0.00 $0.00 $0.00 $0.00
Professional Customer/Broker Deal- 0.00 0.00 0.00 0.00
er.
Market Maker ................................... 0.00 0.00 0.00 0.00
Professional Customer or Broker Public Customer ............................... 0.60 0.50 0.95 1.07
Dealer.
Professional Customer/Broker Deal- 0.25 0.40 0.35 0.40
er.
Market Maker ................................... 0.25 0.44 0.35 0.44
asabaliauskas on DSK9F6TC42PROD with NOTICES2

Market Maker .................................... Public Customer ............................... 0.51 0.50 0.85 1.03
Professional Customer/Broker Deal- 0.00 0.05 0.00 0.10
er.
Market Maker ................................... 0.00 0.29 0.00 0.29

25 17 CFR 200.30–3(a)(12). 2 17 CFR 240.19b–4. 4 17CFR 240.19b–4(f)(2).
1 15 5 Non-Auction Transactions are those transactions
U.S.C. 78s(b)(1). 3 15 U.S.C. 78s(b)(3)(A)(ii).
executed on the BOX Book.

VerDate Sep<11>2014 17:22 Feb 09, 2016 Jkt 238001 PO 00000 Frm 00108 Fmt 4703 Sfmt 4703 E:\FR\FM\10FEN1.SGM 10FEN1
7172 Federal Register / Vol. 81, No. 27 / Wednesday, February 10, 2016 / Notices

The Exchange also proposes to make B. Self-Regulatory Organization’s change is consistent with the Act.
non-substantive technical chances [sic] Statement on Burden on Competition Comments may be submitted by any of
to Section I.A. of the BOX Fee Schedule The Exchange does not believe that the following methods:
(Non-Auction Transactions) and remove the proposed rule change will impose
references to credits. Electronic Comments
any burden on competition not
2. Statutory Basis necessary or appropriate in furtherance • Use the Commission’s Internet
The Exchange believes that the of the purposes of the Act. The comment form (http://www.sec.gov/
proposal is consistent with the Exchange believes that the proposed rules/sro.shtml); or
requirements of Section 6(b) of the Act, adjustments to fees and rebates [sic] in • Send an email to rule-comments@
in general, and Section 6(b)(4) and the Non-Auction Transactions fee sec.gov. Please include File Number SR–
6(b)(5) of the Act,6 in particular, in that structure will not impose a burden on BOX–2016–02 on the subject line.
it provides for the equitable allocation competition among various Exchange
of reasonable dues, fees, and other Participants. Rather, BOX believes that Paper Comments
charges among BOX Participants and the changes will result in the
Participants being charged appropriately • Send paper comments in triplicate
other persons using its facilities and to Secretary, Securities and Exchange
does not unfairly discriminate between for these transactions and are designed
to enhance competition in Non-Auction Commission, 100 F Street NE.,
customers, issuers, brokers or dealers. Washington, DC 20549–1090.
The proposed changes will allow the transactions on BOX. Submitting an
Exchange to be competitive with other order is entirely voluntary and All submissions should refer to File
exchanges and to apply fees and credits Participants can determine which type Number SR–BOX–2016–02. This file
[sic] in a manner that is equitable among of order they wish to submit, if any, to number should be included on the
all BOX Participants. Further, the the Exchange. Further, the Exchange subject line if email is used. To help the
Exchange operates within a highly believes that this proposal will enhance Commission process and review your
competitive market in which market competition between exchanges because comments more efficiently, please use
participants can readily direct order it is designed to allow the Exchange to only one method. The Commission will
flow to any other competing exchange if better compete with other exchanges for post all comments on the Commission’s
they determine fees at a particular order flow. Internet Web site (http://www.sec.gov/
exchange to be excessive. C. Self-Regulatory Organization’s rules/sro.shtml). Copies of the
The Exchange believes it is equitable, Statement on Comments on the submission, all subsequent
reasonable and not unfairly Proposed Rule Change Received From amendments, all written statements
discriminatory to assess fees according Members, Participants, or Others with respect to the proposed rule
to the account type of the Participant change that are filed with the
originating the order and the contra No written comments were either
solicited or received. Commission, and all written
party. This fee structure has been in
communications relating to the
place on the Exchange for some time III. Date of Effectiveness of the proposed rule change between the
and the Exchange is simply adjusting Proposed Rule Change and Timing for Commission and any person, other than
certain credits [sic] within the Commission Action those that may be withheld from the
structure.7 The result of this structure is
The foregoing rule change has become public in accordance with the
that a Participant does not know the fee
it will be charged when submitting effective pursuant to Section provisions of 5 U.S.C. 552, will be
certain orders. Therefore, the Participant 19(b)(3)(A)(ii) of the Exchange Act 9 and available for Web site viewing and
must recognize that it could be charged Rule 19b–4(f)(2) thereunder,10 because printing in the Commission’s Public
the highest applicable fee on the it establishes or changes a due, or fee. Reference Room, 100 F Street NE.,
Exchange’s schedule, which may, At any time within 60 days of the Washington, DC 20549 on official
instead, be lowered or changed to a filing of the proposed rule change, the business days between the hours of
credit depending upon how the order Commission summarily may 10:00 a.m. and 3:00 p.m. Copies of such
interacts. temporarily suspend the rule change if filing also will be available for
The Exchange believes the proposed it appears to the Commission that the inspection and copying at the principal
fees for Non-Auction [sic] for action is necessary or appropriate in the office of the Exchange. All comments
Professional Customers, Broker Dealers public interest, for the protection of received will be posted without change;
and Market Makers when taking investors, or would otherwise further the Commission does not edit personal
liquidity against Public Customers are the purposes of the Act. If the identifying information from
reasonable, equitable and not unfairly Commission takes such action, the submissions. You should submit only
discriminatory. The Exchange believes Commission shall institute proceedings information that you wish to make
these fees are reasonable as they are in to determine whether the proposed rule available publicly. All submissions
line with the current fees assessed by should be approved or disapproved. should refer to File Number SR–BOX–
other competing exchanges.8 2016–02, and should be submitted on or
IV. Solicitation of Comments before March 2, 2016.
6 15 U.S.C. 78f(b)(4) and (5). Interested persons are invited to For the Commission, by the Division of
submit written data, views, and
asabaliauskas on DSK9F6TC42PROD with NOTICES2

7 See Securities Exchange Act Release No. 73547
Trading and Markets, pursuant to delegated
(November 6, 2014), 79 FR 67520 (November 13, arguments concerning the foregoing,
2014) (Notice of Filing and Immediate Effectiveness authority.11
of SR–BOX–2014–25).
including whether the proposed rule
Robert W. Errett,
8 Miami Securities International Exchange, LLC

(‘‘MIAX’’) charges $0.45 to firms and $0.47 to non- in Penny Pilot issues. In addition, NASDAQ Deputy Secretary.
MIAX market makers, broker dealers and public Options Market LLC (‘‘NOM’’) and BATS BZX [FR Doc. 2016–02607 Filed 2–9–16; 8:45 am]
customers other than priority customers for Exchange (‘‘BATS’’) charge a $0.50 take fee for
removing liquidity in Penny Pilot issues. BILLING CODE 8011–01–P
execution in Penny Pilot issues and NASDAQ OMX
9 15 U.S.C. 78s(b)(3)(A)(ii).
PHLX LLC (‘‘PHLX’’) charges $0.48 to professional
customers, broker dealers and firms for execution 10 17 CFR 240.19b–4(f)(2). 11 17 CFR 200.30–3(a)(12).

VerDate Sep<11>2014 17:22 Feb 09, 2016 Jkt 238001 PO 00000 Frm 00109 Fmt 4703 Sfmt 9990 E:\FR\FM\10FEN1.SGM 10FEN1
Document Created: 2016-02-10 00:19:25
Document Modified: 2016-02-10 00:19:25
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 7171