81_FR_73046 81 FR 72842 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Its Price List To Eliminate Take Fees for Bonds Executed on the NYSE BondsSM

81 FR 72842 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Its Price List To Eliminate Take Fees for Bonds Executed on the NYSE BondsSM

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 204 (October 21, 2016)

Page Range72842-72844
FR Document2016-25466

Federal Register, Volume 81 Issue 204 (Friday, October 21, 2016)
[Federal Register Volume 81, Number 204 (Friday, October 21, 2016)]
[Notices]
[Pages 72842-72844]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-25466]


=======================================================================
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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-79106; File No. SR-NYSE-2016-65]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Its Price List To Eliminate Take Fees for Bonds Executed on the 
NYSE Bonds\SM\ System

October 17, 2016.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on October 3, 2016, New York Stock Exchange LLC (``NYSE'' 
or the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I, 
II, and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Price List to eliminate take 
fees for bonds executed on the NYSE Bonds\SM\ system. The proposed rule 
change is available on the Exchange's Web site at www.nyse.com, at the 
principal office of the Exchange, and at the Commission's Public 
Reference Room.

[[Page 72843]]

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Price List to eliminate take 
fees for bonds executed on the NYSE Bonds system. The Exchange 
currently charges transaction fees to liquidity takers for transactions 
executed on NYSE Bonds with a staggered fee schedule based on the 
number of bonds purchased or sold. Currently, the transaction fee for 
orders that take liquidity from the NYSE Bonds Book is $0.50 per bond 
for executions of one to ten (10) bonds; $0.20 per bond for executions 
of eleven (11) to twenty-five (25) bonds; and $0.10 per bond for 
executions of twenty-six (26) bonds or more. The Exchange also 
currently has a fee cap of $100 per execution.
    The Exchange proposes to eliminate the take fee for all bonds 
executed on NYSE Bonds. The Exchange also proposes to remove text from 
the fee schedule regarding the maximum fee per execution because that 
text would no longer be applicable once the take fee is eliminated.
    Additionally, the Exchange recently adopted the Liquidity Provider 
Incentive Program, a voluntary rebate program that pays Users \4\ of 
NYSE Bonds a monthly rebate provided Users who opt into the rebate 
program meet specified quoting requirements.\5\ Users who opt in to the 
Liquidity Provider Incentive Program are subject to a transaction fee 
for orders that provide liquidity to the NYSE Bonds Book of $0.50 per 
bond.\6\ For orders that take liquidity from the NYSE Bonds Book, the 
current tiered fees noted above apply. However, with this proposed rule 
change, Users who opt into the Liquidity Provider Incentive Program 
would no longer be subject to fees for orders that take liquidity. To 
reflect the elimination of take fees as proposed herein, the Exchange 
proposes to delete text from the fee schedule regarding the 
applicability of standard execution fees under the Liquidity Provider 
Incentive Program for orders that take liquidity from the NYSE Bonds 
Book because that text would no longer be applicable.
---------------------------------------------------------------------------

    \4\ Rule 86(b)(2)(M) defines a User as any Member or Member 
Organization, Sponsored Participant, or Authorized Trader that is 
authorized to access NYSE Bonds.
    \5\ See Securities Exchange Act Release Nos. 77591 (April 12, 
2016), 81 FR 22656 (April 18, 2016) (SR-NYSE-2016-26); and 77812 
(May 11, 2016), 81 FR 30594 May 17, 2016) (SR-NYSE-2016-34).
    \6\ The Exchange recently adopted a fee waiver applicable to 
Users that provide liquidity in 800 or more qualifying CUSIPs quoted 
on the NYSE Bonds Book, and a fee cap of $5,000 per month applicable 
to all Users that do not attain the fee waiver. See Securities 
Exchange Act Release No. 78108 (June 21, 2016), 81 FR 41636 (June 
27, 2016) (SR-NYSE-2016-42).
---------------------------------------------------------------------------

    The proposed rule change is intended to provide Users with a 
greater incentive to transact on the NYSE Bonds system.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\7\ in general, and furthers the 
objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\8\ in 
particular, because it provides for the equitable allocation of 
reasonable dues, fees, and other charges among its members, issuers and 
other persons using its facilities and does not unfairly discriminate 
between customers, issuers, brokers or dealers.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4), (5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed changes to eliminate the 
transaction fee for orders that take liquidity from the NYSE bonds Book 
is reasonable and equitable as it is designed to incentivize the 
submission of such orders and increase order volume on the Exchange. 
The proposed fee change is a reasonable amendment to the Exchange's fee 
schedule and is equitably allocated and does not unfairly discriminate 
between customers, issuers, and brokers or dealers because all Users 
are eligible to submit (or not submit) displayed liquidity taking 
orders in bonds traded on the Exchange. The Exchange believes that the 
proposed fee change is a reasonable method to incentivize the 
submission of such orders, which the Exchange believes will result in a 
greater number of bonds transacted on the Exchange, thereby increasing 
displayed liquidity and traded volume on the Exchange.
    The Exchange is proposing to adopt a pricing model whereby Users 
that take liquidity from the NYSE Bonds system would not pay a fee. The 
proposed rule change will therefore benefit all Users that take 
liquidity from the NYSE Bonds system.
    The Exchange further believes that the proposed rule change is 
equitable and not unfairly discriminatory in that it will apply 
uniformly to all Users accessing the NYSE Bonds system. All similarly 
situated Users would be subject to the same fee structure, and each 
User would have the ability to determine the extent to which the 
Exchange's proposed structure will provide it with an economic 
incentive to use the NYSE Bonds system, and model its business 
accordingly.

B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with Section 6(b)(8) of the Act,\9\ the Exchange 
believes that the proposed rule change would not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. Debt securities typically trade in a decentralized 
OTC dealer market that is less liquid and transparent than the equities 
markets. The Exchange believes that the proposed change would increase 
competition with these OTC venues by creating additional incentives to 
engage in bonds transactions on the Exchange and rewarding market 
participants for actively quoting and providing liquidity in the only 
transparent bond market, which the Exchange believes will enhance 
market quality.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    The Exchange notes that it operates in a highly competitive market 
in which market participants can readily favor competing venues that 
are not transparent. In such an environment, the Exchange must 
continually review, and consider adjusting its fees and rebates to 
remain competitive with other exchanges as well as with alternative 
trading systems and other venues that are not required to comply with 
the statutory standards applicable to exchanges. Because competitors 
are free to modify their own fees and credits in response, and because 
market participants may readily adjust their order routing practices, 
the Exchange believes that the degree to which fee changes in this 
market may impose any burden on competition is extremely limited. As a 
result of all of these considerations, the Exchange does not believe 
that the proposed change will impair the ability of member 
organizations or competing order execution venues to maintain their 
competitive standing in the financial markets.

[[Page 72844]]

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

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \10\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \11\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \12\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

IV. Solicitation of Comments

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

Electronic 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-NYSE-2016-65 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-NYSE-2016-65. 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-NYSE-2016-65, and should be 
submitted on or before November 14, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-25466 Filed 10-20-16; 8:45 am]
 BILLING CODE 8011-01-P



                                                    72842                         Federal Register / Vol. 81, No. 204 / Friday, October 21, 2016 / Notices

                                                    telephone for advice on filing                          Priority Mail Contract 248 to                         Kenneth R. Moeller; Comments Due:
                                                    alternatives.                                           Competitive Product List and Notice of                October 25, 2016.
                                                    FOR FURTHER INFORMATION CONTACT:
                                                                                                            Filing (Under Seal) of Unredacted                       7. Docket No(s).: CP2017–17; Filing
                                                    David A. Trissell, General Counsel, at                  Governors’ Decision, Contract, and                    Title: Notice of United States Postal
                                                    202–789–6820.                                           Supporting Data; Filing Acceptance                    Service of Filing a Functionally
                                                                                                            Date: October 14, 2016; Filing Authority:             Equivalent Global Expedited Package
                                                    SUPPLEMENTARY INFORMATION:
                                                                                                            39 U.S.C. 3642 and 39 CFR 3020.30 et                  Services 3 Negotiated Service
                                                    Table of Contents                                       seq.; Public Representative: Curtis E.                Agreement and Application for Non-
                                                                                                            Kidd; Comments Due: October 24, 2016.                 Public Treatment of Materials Filed
                                                    I. Introduction
                                                    II. Docketed Proceeding(s)                                2. Docket No(s).: MC2017–6 and                      Under Seal; Filing Acceptance Date:
                                                                                                            CP2017–12; Filing Title: Request of the               October 14, 2016; Filing Authority: 39
                                                    I. Introduction                                         United States Postal Service to Add                   CFR 3015.5; Public Representative:
                                                       The Commission gives notice that the                 Priority Mail Express & Priority Mail                 Curtis E. Kidd; Comments Due: October
                                                    Postal Service filed request(s) for the                 Contract 37 to Competitive Product List               26, 2016.
                                                    Commission to consider matters related                  and Notice of Filing (Under Seal) of                    This notice will be published in the
                                                    to negotiated service agreement(s). The                 Unredacted Governors’ Decision,                       Federal Register.
                                                    request(s) may propose the addition or                  Contract, and Supporting Data; Filing
                                                                                                                                                                  Stacy L. Ruble,
                                                    removal of a negotiated service                         Acceptance Date: October 14, 2016;
                                                                                                                                                                  Secretary.
                                                    agreement from the market dominant or                   Filing Authority: 39 U.S.C. 3642 and 39
                                                                                                            CFR 3020.30 et seq.; Public                           [FR Doc. 2016–25461 Filed 10–20–16; 8:45 am]
                                                    the competitive product list, or the
                                                    modification of an existing product                     Representative: Curtis E. Kidd;                       BILLING CODE 7710–FW–P

                                                    currently appearing on the market                       Comments Due: October 24, 2016.
                                                    dominant or the competitive product                       3. Docket No(s).: CP2017–13; Filing
                                                    list.                                                   Title: Notice of United States Postal                 SECURITIES AND EXCHANGE
                                                       Section II identifies the docket                     Service of Filing a Functionally                      COMMISSION
                                                    number(s) associated with each Postal                   Equivalent Global Expedited Package
                                                    Service request, the title of each Postal               Services 3 Negotiated Service                         [Release No. 34–79106; File No. SR–NYSE–
                                                    Service request, the request’s acceptance               Agreement and Application for Non-                    2016–65]
                                                    date, and the authority cited by the                    Public Treatment of Materials Filed
                                                                                                            Under Seal; Filing Acceptance Date:                   Self-Regulatory Organizations; New
                                                    Postal Service for each request. For each                                                                     York Stock Exchange LLC; Notice of
                                                    request, the Commission appoints an                     October 14, 2016; Filing Authority: 39
                                                                                                            CFR 3015.5; Public Representative:                    Filing and Immediate Effectiveness of
                                                    officer of the Commission to represent                                                                        Proposed Rule Change To Amend Its
                                                    the interests of the general public in the              Jennaca D. Upperman; Comments Due:
                                                                                                            October 25, 2016.                                     Price List To Eliminate Take Fees for
                                                    proceeding, pursuant to 39 U.S.C. 505                                                                         Bonds Executed on the NYSE BondsSM
                                                    (Public Representative). Section II also                  4. Docket No(s).: CP2017–14; Filing
                                                                                                            Title: Notice of United States Postal                 System
                                                    establishes comment deadline(s)
                                                    pertaining to each request.                             Service of Filing a Functionally                      October 17, 2016.
                                                       The public portions of the Postal                    Equivalent Global Expedited Package                      Pursuant to Section 19(b)(1) 1 of the
                                                    Service’s request(s) can be accessed via                Services 3 Negotiated Service                         Securities Exchange Act of 1934 (the
                                                    the Commission’s Web site (http://                      Agreement and Application for Non-                    ‘‘Act’’) 2 and Rule 19b–4 thereunder,3
                                                    www.prc.gov). Non-public portions of                    Public Treatment of Materials Filed                   notice is hereby given that, on October
                                                    the Postal Service’s request(s), if any,                Under Seal; Filing Acceptance Date:                   3, 2016, New York Stock Exchange LLC
                                                    can be accessed through compliance                      October 14, 2016; Filing Authority: 39                (‘‘NYSE’’ or the ‘‘Exchange’’) filed with
                                                    with the requirements of 39 CFR                         CFR 3015.5; Public Representative:                    the Securities and Exchange
                                                    3007.40.                                                Jennaca D. Upperman; Comments Due:                    Commission (the ‘‘Commission’’) the
                                                       The Commission invites comments on                   October 25, 2016.                                     proposed rule change as described in
                                                    whether the Postal Service’s request(s)                   5. Docket No(s).: CP2017–15; Filing                 Items I, II, and III below, which Items
                                                    in the captioned docket(s) are consistent               Title: Notice of United States Postal                 have been prepared by the self-
                                                    with the policies of title 39. For                      Service of Filing a Functionally                      regulatory organization. The
                                                    request(s) that the Postal Service states               Equivalent Global Expedited Package                   Commission is publishing this notice to
                                                    concern market dominant product(s),                     Services 3 Negotiated Service                         solicit comments on the proposed rule
                                                    applicable statutory and regulatory                     Agreement and Application for Non-                    change from interested persons.
                                                    requirements include 39 U.S.C. 3622, 39                 Public Treatment of Materials Filed
                                                    U.S.C. 3642, 39 CFR part 3010, and 39                   Under Seal; Filing Acceptance Date:                   I. Self-Regulatory Organization’s
                                                    CFR part 3020, subpart B. For request(s)                October 14, 2016; Filing Authority: 39                Statement of the Terms of Substance of
                                                    that the Postal Service states concern                  CFR 3015.5; Public Representative:                    the Proposed Rule Change
                                                    competitive product(s), applicable                      Kenneth R. Moeller; Comments Due:                       The Exchange proposes to amend its
                                                    statutory and regulatory requirements                   October 25, 2016.                                     Price List to eliminate take fees for
                                                    include 39 U.S.C. 3632, 39 U.S.C. 3633,                   6. Docket No(s).: CP2017–16; Filing                 bonds executed on the NYSE BondsSM
                                                                                                            Title: Notice of United States Postal
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    39 U.S.C. 3642, 39 CFR part 3015, and                                                                         system. The proposed rule change is
                                                    39 CFR part 3020, subpart B. Comment                    Service of Filing a Functionally                      available on the Exchange’s Web site at
                                                    deadline(s) for each request appear in                  Equivalent Global Expedited Package                   www.nyse.com, at the principal office of
                                                    section II.                                             Services 3 Negotiated Service                         the Exchange, and at the Commission’s
                                                                                                            Agreement and Application for Non-                    Public Reference Room.
                                                    II. Docketed Proceeding(s)                              Public Treatment of Materials Filed
                                                      1. Docket No(s).: MC2017–5 and                        Under Seal; Filing Acceptance Date:                     1 15 U.S.C. 78s(b)(1).
                                                    CP2017–11; Filing Title: Request of the                 October 14, 2016; Filing Authority: 39                  2 15 U.S.C. 78a.
                                                    United States Postal Service to Add                     CFR 3015.5; Public Representative:                      3 17 CFR 240.19b–4.




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                                                                                  Federal Register / Vol. 81, No. 204 / Friday, October 21, 2016 / Notices                                         72843

                                                    II. Self-Regulatory Organization’s                      liquidity from the NYSE Bonds Book,                   change will therefore benefit all Users
                                                    Statement of the Purpose of, and                        the current tiered fees noted above                   that take liquidity from the NYSE Bonds
                                                    Statutory Basis for, the Proposed Rule                  apply. However, with this proposed rule               system.
                                                    Change                                                  change, Users who opt into the                          The Exchange further believes that the
                                                       In its filing with the Commission, the               Liquidity Provider Incentive Program                  proposed rule change is equitable and
                                                    self-regulatory organization included                   would no longer be subject to fees for                not unfairly discriminatory in that it
                                                    statements concerning the purpose of,                   orders that take liquidity. To reflect the            will apply uniformly to all Users
                                                    and basis for, the proposed rule change                 elimination of take fees as proposed                  accessing the NYSE Bonds system. All
                                                    and discussed any comments it received                  herein, the Exchange proposes to delete               similarly situated Users would be
                                                    on the proposed rule change. The text                   text from the fee schedule regarding the              subject to the same fee structure, and
                                                    of those statements may be examined at                  applicability of standard execution fees              each User would have the ability to
                                                    the places specified in Item IV below.                  under the Liquidity Provider Incentive                determine the extent to which the
                                                    The Exchange has prepared summaries,                    Program for orders that take liquidity                Exchange’s proposed structure will
                                                    set forth in sections A, B, and C below,                from the NYSE Bonds Book because that                 provide it with an economic incentive
                                                    of the most significant parts of such                   text would no longer be applicable.                   to use the NYSE Bonds system, and
                                                    statements.                                                The proposed rule change is intended               model its business accordingly.
                                                                                                            to provide Users with a greater incentive             B. Self-Regulatory Organization’s
                                                    A. Self-Regulatory Organization’s                       to transact on the NYSE Bonds system.
                                                    Statement of the Purpose of, and the                                                                          Statement on Burden on Competition
                                                    Statutory Basis for, the Proposed Rule                  2. Statutory Basis                                       In accordance with Section 6(b)(8) of
                                                    Change                                                     The Exchange believes that the                     the Act,9 the Exchange believes that the
                                                                                                            proposed rule change is consistent with               proposed rule change would not impose
                                                    1. Purpose                                                                                                    any burden on competition that is not
                                                                                                            Section 6(b) of the Act,7 in general, and
                                                       The Exchange proposes to amend its                   furthers the objectives of Sections                   necessary or appropriate in furtherance
                                                    Price List to eliminate take fees for                   6(b)(4) and 6(b)(5) of the Act,8 in                   of the purposes of the Act. Debt
                                                    bonds executed on the NYSE Bonds                        particular, because it provides for the               securities typically trade in a
                                                    system. The Exchange currently charges                  equitable allocation of reasonable dues,              decentralized OTC dealer market that is
                                                    transaction fees to liquidity takers for                fees, and other charges among its                     less liquid and transparent than the
                                                    transactions executed on NYSE Bonds                     members, issuers and other persons                    equities markets. The Exchange believes
                                                    with a staggered fee schedule based on                  using its facilities and does not unfairly            that the proposed change would
                                                    the number of bonds purchased or sold.                  discriminate between customers,                       increase competition with these OTC
                                                    Currently, the transaction fee for orders               issuers, brokers or dealers.                          venues by creating additional incentives
                                                    that take liquidity from the NYSE Bonds                    The Exchange believes that the                     to engage in bonds transactions on the
                                                    Book is $0.50 per bond for executions of                proposed changes to eliminate the                     Exchange and rewarding market
                                                    one to ten (10) bonds; $0.20 per bond for               transaction fee for orders that take                  participants for actively quoting and
                                                    executions of eleven (11) to twenty-five                liquidity from the NYSE bonds Book is                 providing liquidity in the only
                                                    (25) bonds; and $0.10 per bond for                      reasonable and equitable as it is                     transparent bond market, which the
                                                    executions of twenty-six (26) bonds or                  designed to incentivize the submission                Exchange believes will enhance market
                                                    more. The Exchange also currently has                   of such orders and increase order                     quality.
                                                    a fee cap of $100 per execution.                        volume on the Exchange. The proposed                     The Exchange notes that it operates in
                                                       The Exchange proposes to eliminate                   fee change is a reasonable amendment                  a highly competitive market in which
                                                    the take fee for all bonds executed on                  to the Exchange’s fee schedule and is                 market participants can readily favor
                                                    NYSE Bonds. The Exchange also                           equitably allocated and does not                      competing venues that are not
                                                    proposes to remove text from the fee                    unfairly discriminate between                         transparent. In such an environment,
                                                    schedule regarding the maximum fee                      customers, issuers, and brokers or                    the Exchange must continually review,
                                                    per execution because that text would                   dealers because all Users are eligible to             and consider adjusting its fees and
                                                    no longer be applicable once the take fee               submit (or not submit) displayed                      rebates to remain competitive with other
                                                    is eliminated.                                          liquidity taking orders in bonds traded               exchanges as well as with alternative
                                                       Additionally, the Exchange recently                                                                        trading systems and other venues that
                                                                                                            on the Exchange. The Exchange believes
                                                    adopted the Liquidity Provider                                                                                are not required to comply with the
                                                                                                            that the proposed fee change is a
                                                    Incentive Program, a voluntary rebate                                                                         statutory standards applicable to
                                                                                                            reasonable method to incentivize the
                                                    program that pays Users 4 of NYSE                                                                             exchanges. Because competitors are free
                                                                                                            submission of such orders, which the
                                                    Bonds a monthly rebate provided Users                                                                         to modify their own fees and credits in
                                                                                                            Exchange believes will result in a
                                                    who opt into the rebate program meet                                                                          response, and because market
                                                                                                            greater number of bonds transacted on
                                                    specified quoting requirements.5 Users                                                                        participants may readily adjust their
                                                    who opt in to the Liquidity Provider                    the Exchange, thereby increasing
                                                                                                            displayed liquidity and traded volume                 order routing practices, the Exchange
                                                    Incentive Program are subject to a                                                                            believes that the degree to which fee
                                                    transaction fee for orders that provide                 on the Exchange.
                                                                                                               The Exchange is proposing to adopt a               changes in this market may impose any
                                                    liquidity to the NYSE Bonds Book of                                                                           burden on competition is extremely
                                                                                                            pricing model whereby Users that take
                                                    $0.50 per bond.6 For orders that take                                                                         limited. As a result of all of these
                                                                                                            liquidity from the NYSE Bonds system
                                                                                                                                                                  considerations, the Exchange does not
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                      4 Rule 86(b)(2)(M) defines a User as any Member
                                                                                                            would not pay a fee. The proposed rule
                                                    or Member Organization, Sponsored Participant, or
                                                                                                                                                                  believe that the proposed change will
                                                    Authorized Trader that is authorized to access          more qualifying CUSIPs quoted on the NYSE Bonds       impair the ability of member
                                                    NYSE Bonds.                                             Book, and a fee cap of $5,000 per month applicable    organizations or competing order
                                                      5 See Securities Exchange Act Release Nos. 77591      to all Users that do not attain the fee waiver. See   execution venues to maintain their
                                                    (April 12, 2016), 81 FR 22656 (April 18, 2016) (SR–     Securities Exchange Act Release No. 78108 (June
                                                                                                            21, 2016), 81 FR 41636 (June 27, 2016) (SR–NYSE–      competitive standing in the financial
                                                    NYSE–2016–26); and 77812 (May 11, 2016), 81 FR
                                                    30594 May 17, 2016) (SR–NYSE–2016–34).                  2016–42).                                             markets.
                                                      6 The Exchange recently adopted a fee waiver            7 15 U.S.C. 78f(b).

                                                    applicable to Users that provide liquidity in 800 or      8 15 U.S.C. 78f(b)(4), (5).                           9 15   U.S.C. 78f(b)(8).



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                                                    72844                          Federal Register / Vol. 81, No. 204 / Friday, October 21, 2016 / Notices

                                                    C. Self-Regulatory Organization’s                       rules/sro.shtml). Copies of the                       proposed rule change from interested
                                                    Statement on Comments on the                            submission, all subsequent                            persons.
                                                    Proposed Rule Change Received From                      amendments, all written statements
                                                                                                                                                                  I. Self-Regulatory Organization’s
                                                    Members, Participants, or Others                        with respect to the proposed rule
                                                                                                                                                                  Statement of the Terms of Substance of
                                                      No written comments were solicited                    change that are filed with the
                                                                                                                                                                  the Proposed Rule Change
                                                    or received with respect to the proposed                Commission, and all written
                                                                                                            communications relating to the                           The Exchange proposes to amend
                                                    rule change.
                                                                                                            proposed rule change between the                      Chapter XV, entitled ‘‘Options Pricing,’’
                                                    III. Date of Effectiveness of the                       Commission and any person, other than                 at Section 3, entitled ‘‘NASDAQ
                                                    Proposed Rule Change and Timing for                     those that may be withheld from the                   Options Market—Access Services.’’
                                                    Commission Action                                       public in accordance with the                         Chapter XV governs pricing for
                                                       The foregoing rule change is effective               provisions of 5 U.S.C. 552, will be                   Exchange members using the NASDAQ
                                                    upon filing pursuant to Section                         available for Web site viewing and                    Options Market LLC (‘‘NOM’’), the
                                                    19(b)(3)(A) 10 of the Act and                           printing in the Commission’s Public                   Exchange’s facility for executing and
                                                    subparagraph (f)(2) of Rule 19b–4 11                    Reference Room, 100 F Street NE.,                     routing standardized equity and index
                                                    thereunder, because it establishes a due,               Washington, DC 20549 on official                      options. The Exchange proposes to
                                                    fee, or other charge imposed by the                     business days between the hours of                    amend Specialized Quote Feed (‘‘SQF’’)
                                                    Exchange.                                               10:00 a.m. and 3:00 p.m. Copies of such               Port 3 Fees.
                                                       At any time within 60 days of the                    filing also will be available for                        The text of the proposed rule change
                                                    filing of such proposed rule change, the                inspection and copying at the principal               is available on the Exchange’s Web site
                                                    Commission summarily may                                office of the Exchange. All comments                  at http://nasdaq.cchwallstreet.com, at
                                                                                                            received will be posted without change;               the principal office of the Exchange, and
                                                    temporarily suspend such rule change if
                                                                                                                                                                  at the Commission’s Public Reference
                                                    it appears to the Commission that such                  the Commission does not edit personal
                                                                                                                                                                  Room.
                                                    action is necessary or appropriate in the               identifying information from
                                                    public interest, for the protection of                  submissions. You should submit only                   II. Self-Regulatory Organization’s
                                                    investors, or otherwise in furtherance of               information that you wish to make                     Statement of the Purpose of, and
                                                    the purposes of the Act. If the                         available publicly. All submissions                   Statutory Basis for, the Proposed Rule
                                                    Commission takes such action, the                       should refer to File Number SR–NYSE–                  Change
                                                    Commission shall institute proceedings                  2016–65, and should be submitted on or                   In its filing with the Commission, the
                                                    under Section 19(b)(2)(B) 12 of the Act to              before November 14, 2016.                             Exchange included statements
                                                    determine whether the proposed rule                       For the Commission, by the Division of              concerning the purpose of and basis for
                                                    change should be approved or                            Trading and Markets, pursuant to delegated            the proposed rule change and discussed
                                                    disapproved.                                            authority.13                                          any comments it received on the
                                                    IV. Solicitation of Comments                            Robert W. Errett,                                     proposed rule change. The text of these
                                                                                                            Deputy Secretary.                                     statements may be examined at the
                                                      Interested persons are invited to                                                                           places specified in Item IV below. The
                                                                                                            [FR Doc. 2016–25466 Filed 10–20–16; 8:45 am]
                                                    submit written data, views, and                                                                               Exchange has prepared summaries, set
                                                                                                            BILLING CODE 8011–01–P
                                                    arguments concerning the foregoing,                                                                           forth in sections A, B, and C below, of
                                                    including whether the proposed rule                                                                           the most significant aspects of such
                                                    change is consistent with the Act.                                                                            statements.
                                                                                                            SECURITIES AND EXCHANGE
                                                    Comments may be submitted by any of
                                                                                                            COMMISSION                                            A. Self-Regulatory Organization’s
                                                    the following methods:
                                                                                                            [Release No. 34–79105; File No. SR–                   Statement of the Purpose of, and
                                                    Electronic Comments                                                                                           Statutory Basis for, the Proposed Rule
                                                                                                            NASDAQ–2016–133]
                                                      • Use the Commission’s Internet                                                                             Change
                                                    comment form (http://www.sec.gov/                       Self-Regulatory Organizations; The
                                                                                                                                                                  1. Purpose
                                                    rules/sro.shtml); or                                    NASDAQ Stock Market LLC; Notice of
                                                      • Send an email to rule-comments@                     Filing and Immediate Effectiveness of                    The Exchange proposes to amend the
                                                    sec.gov. Please include File Number SR–                 Proposed Rule Change To Amend                         SQF Port Fees in Chapter XV, Section 3
                                                    NYSE–2016–65 on the subject line.                       Specialized Quote Feed Port Fees                      of the NOM Rules, while the Exchange
                                                                                                                                                                  transitions to state-of-the-art hardware
                                                    Paper Comments                                          October 17, 2016.                                     and software architecture to achieve a
                                                      • Send paper comments in triplicate                      Pursuant to Section 19(b)(1) of the                more efficient and more robust
                                                    to Brent J. Fields, Secretary, Securities               Securities Exchange Act of 1934                       infrastructure to support the growing
                                                    and Exchange Commission, 100 F Street                   (‘‘Act’’),1 and Rule 19b–4 thereunder,2               needs of our Options Participants
                                                    NE., Washington, DC 20549–1090.                         notice is hereby given that on October                (‘‘NOM Refresh’’). In connection with
                                                    All submissions should refer to File                    3, 2016, The NASDAQ Stock Market                      the NOM Refresh, NOM Market Makers
                                                    Number SR–NYSE–2016–65. This file                       LLC (‘‘Nasdaq’’ or ‘‘Exchange’’) filed                will be required to make changes to
                                                    number should be included on the                        with the Securities and Exchange
                                                    subject line if email is used. To help the              Commission (‘‘SEC’’ or ‘‘Commission’’)                   3 SQF ports are ports that receive inbound quotes
asabaliauskas on DSK3SPTVN1PROD with NOTICES




                                                    Commission process and review your                      the proposed rule change as described                 at any time within that month. The SQF Port allows
                                                                                                            in Items I, II, and III, below, which Items           a NOM Market Maker to access information such as
                                                    comments more efficiently, please use                                                                         execution reports and other relevant data through
                                                    only one method. The Commission will                    have been prepared by the Exchange.                   a single feed. For example, this data would show
                                                    post all comments on the Commission’s                   The Commission is publishing this                     which symbols are trading on NOM and the current
                                                    Internet Web site (http://www.sec.gov/                  notice to solicit comments on the                     state of an options symbol (i.e., open for trading,
                                                                                                                                                                  trading, halted or closed). Auction notifications and
                                                                                                                                                                  execution reports are also available. NOM Market
                                                      10 15 U.S.C. 78s(b)(3)(A).                              13 17 CFR 200.30–3(a)(12).                          Makers rely on data available through the SQF Port
                                                      11 17 CFR 240.19b–4(f)(2).                              1 15 U.S.C. 78s(b)(1).                              to provide them the necessary information to
                                                      12 15 U.S.C. 78s(b)(2)(B).                              2 17 CFR 240.19b–4.                                 perform market making activities.



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Document Created: 2018-02-13 16:36:13
Document Modified: 2018-02-13 16:36:13
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation81 FR 72842 

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