81 FR 90009 - Self-Regulatory Organizations; Bats EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Fees for Use of the Exchange's Equities Platform

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 239 (December 13, 2016)

Page Range		90009-90010
FR Document		2016-29806
Federal Register, Volume 81 Issue 239 (Tuesday, December 13, 2016)
[Federal Register Volume 81, Number 239 (Tuesday, December 13, 2016)]
[Notices]
[Pages 90009-90010]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-29806]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-79501; File No. SR-BatsEDGX-2016-68]


Self-Regulatory Organizations; Bats EDGX Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change to Fees 
for Use of the Exchange's Equities Platform

December 7, 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 November 30, 2016, Bats EDGX Exchange, Inc. (the ``Exchange'' 
or ``EDGX'') 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 
Exchange has designated the proposed rule change as one establishing or 
changing a member due, fee, or other charge imposed by the Exchange 
under Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) 
thereunder,\4\ which renders the proposed rule change 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 filed a proposal to amend the fee schedule applicable 
to Members \5\ and non-members of the Exchange pursuant to EDGX Rules 
15.1(a) and (c).
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    \5\ The term ``Member'' is defined as ``any registered broker or 
dealer that has been admitted to membership in the Exchange.'' See 
Exchange Rule 1.5(n).
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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 parts of such 
statements.

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

1. Purpose
    The Exchange proposes to amend its fee schedule to remove the 
Cross-Asset Tier under footnote 1, Add Volume Tiers.
    The Exchange determines the liquidity adding rebate that it will 
provide to Members using the Exchange's tiered pricing structure. 
Currently, the Exchange provides various rebates under footnote 1 of 
the fee schedule for a Member dependent on the Member's ADV \6\ as a 
percentage

[[Page 90010]]

of the TCV \7\ or OCV \8\ for orders that yield fee codes B, V, Y, 3, 
and 4. The Exchange currently has ten Add Volume Tiers under footnote 
1. Under such pricing structure, a Member will receive a rebate of 
anywhere between $0.0025 and $0.0033 per share executed, depending on 
the tier for which such Member qualifies.
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    \6\ As defined in the Exchange's fee schedule available at 
http://www.bats.com/us/equities/membership/fee_schedule/edgx/.
    \7\ Id.
    \8\ As defined in the EDGX Options' fee schedule available at 
http://www.bats.com/us/options/membership/fee_schedule/edgx/.
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    The Exchange now proposes to amend the Add Volume Tiers under 
footnote 1 to remove an existing tier called the Cross-Asset Tier. 
Under the Cross-Asset tier, a Member receives an enhanced rebate of 
$0.0028 per share where that: (i) Member has on the Exchange's equity 
options trading platform (``EDGX Options'') an ADV in Firm\9\ orders 
equal to or greater than 0.15% of average OCV; and (2) Member has an 
ADAV\10\ equal to or greater than 0.12% of average TCV. The Exchange is 
proposing to eliminate the tier because the rebate has not achieved the 
desired effect, despite being designed to incentivize Members to add 
liquidity in two asset classes, both in EDGX equities and EDGX Options. 
As such, the Exchange is proposing to eliminate the text in footnote 1 
related to the Cross-Asset Tier.
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    \9\ Id.
    \10\ As defined in the Exchange's fee schedule available at 
http://batstrading.com/support/fee_schedule/edgx/.
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Implementation Date
    The Exchange proposes to implement this amendment to its fee 
schedule on December 1, 2016.
2. Statutory Basis
    The Exchange believes that the proposed removal of the Cross-Asset 
Tier represents an equitable allocation of reasonable dues, fees, and 
other charges among Members and other persons using its facilities 
because, as described above, the additional rebate offered under this 
tier is not affecting Members' behavior in the manner originally 
conceived by the Exchange. While the Exchange acknowledges the benefit 
of Members entering orders that add liquidity in two asset classes, the 
Exchange has generally determined that it is providing an additional 
rebate for liquidity that would be added on the Exchange regardless of 
whether the tier existed. As such, the Exchange also believes that the 
proposed elimination of the Cross-Asset Tier would be non-
discriminatory in that it currently applies equally to all Members and, 
upon elimination, would no longer be available to any Members. Further, 
it will allow the Exchange to explore other ways in which it may 
enhance market quality for all Members.

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

    The Exchange does not believe its proposed amendment to its fee 
schedule would impose any burden on competition that is not necessary 
or appropriate in furtherance of the purposes of the Act.
    The Exchange does not believe that its proposal to remove the 
Cross-Asset Tier under footnote 1 would burden competition, but, 
rather, enhance the Exchange's ability to compete with other market 
centers. As described above, the Exchange believes that it is offering 
enhanced rebates for orders that would be submitted to the Exchange 
without the enhanced rebate, which prevents the Exchange from being 
able to offer other rebates or reduced fees that might be able to 
enhance market quality to the benefit of all Members. As such, removing 
the Cross-Asset Tier will allow the Exchange other opportunities to 
enhance market quality on the Exchange and ultimately, better compete 
with other market centers.

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

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from Members or other interested 
parties.

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 \11\ and paragraph (f) of Rule 19b-4 
thereunder.\12\ 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.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f).
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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-BatsEDGX-2016-68 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-BatsEDGX-2016-68. 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-BatsEDGX-2016-68, and should 
be submitted on or before January 3, 2017.

    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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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2016-29806 Filed 12-12-16; 8:45 am]
 BILLING CODE 8011-01-P
Federal Register / Vol. 81, No. 239 / Tuesday, December 13, 2016 / Notices 90009

proposed VaR Floor would protect FICC only one method. The Commission will III below, which Items have been
in the event that FICC is required to post all comments on the Commission’s prepared by the Exchange. The
liquidate a large mortgage-backed Internet Web site (http://www.sec.gov/ Exchange has designated the proposed
securities portfolio in stressed market rules/sro.shtml). Copies of the rule change as one establishing or
conditions and therefore would enhance submission, all subsequent changing a member due, fee, or other
FICC’s ability to limit its credit amendments, all written statements charge imposed by the Exchange under
exposures to participants. with respect to the proposed rule Section 19(b)(3)(A)(ii) of the Act 3 and
change that are filed with the Rule 19b–4(f)(2) thereunder,4 which
(C) Clearing Agency’s Statement on Commission, and all written renders the proposed rule change
Comments on the Proposed Rule communications relating to the effective upon filing with the
Change Received From Members, proposed rule change between the Commission. The Commission is
Participants, or Others Commission and any person, other than publishing this notice to solicit
Written comments relating to the those that may be withheld from the comments on the proposed rule change
proposed rule changes have not been public in accordance with the from interested persons.
solicited or received. FICC will notify provisions of 5 U.S.C. 552, will be
the Commission of any written available for Web site viewing and I. Self-Regulatory Organization’s
comments received by FICC. printing in the Commission’s Public Statement of the Terms of the Substance
Reference Room, 100 F Street, NE., of the Proposed Rule Change
III. Date of Effectiveness of the
Washington, DC 20549 on official The Exchange filed a proposal to
Proposed Rule Change and Timing for
business days between the hours of amend the fee schedule applicable to
Commission Action 10:00 a.m. and 3:00 p.m. Copies of the Members 5 and non-members of the
Within 45 days of the date of filing also will be available for Exchange pursuant to EDGX Rules
publication of this notice in the Federal inspection and copying at the principal 15.1(a) and (c).
Register or within such longer period office of FICC and on FICC’s Web site
up to 90 days (i) as the Commission may (http://www.dtcc.com/legal/sec-rule- II. Self-Regulatory Organization’s
designate if it finds such longer period filings.aspx). All comments received Statement of the Purpose of, and
to be appropriate and publishes its will be posted without change; the Statutory Basis for, the Proposed Rule
reasons for so finding or (ii) as to which Commission does not edit personal Change
the self-regulatory organization identifying information from
consents, the Commission will: submissions. You should submit only In its filing with the Commission, the
(A) By order approve or disapprove information that you wish to make Exchange included statements
such proposed rule change, or available publicly. All submissions concerning the purpose of and basis for
(B) institute proceedings to determine should refer to File Number SR–FICC– the proposed rule change and discussed
whether the proposed rule change 2016–007 and should be submitted on any comments it received on the
should be disapproved. or before January 3, 2017. proposed rule change. The text of these
The proposal shall not take effect statements may be examined at the
For the Commission, by the Division of
until all regulatory actions required Trading and Markets, pursuant to delegated
places specified in Item IV below. The
with respect to the proposal are authority.38 Exchange has prepared summaries, set
completed. Eduardo A. Aleman, forth in Sections A, B, and C below, of
the most significant parts of such
IV. Solicitation of Comments Assistant Secretary.
statements.
[FR Doc. 2016–29797 Filed 12–12–16; 8:45 am]
Interested persons are invited to
BILLING CODE 8011–01–P A. Self-Regulatory Organization’s
submit written data, views and
Statement of the Purpose of, and
arguments concerning the foregoing,
Statutory Basis for, the Proposed Rule
including whether the proposed rule
SECURITIES AND EXCHANGE Change
change is consistent with the Act. COMMISSION
Comments may be submitted by any of 1. Purpose
the following methods: [Release No. 34–79501; File No. SR–
BatsEDGX–2016–68] The Exchange proposes to amend its
Electronic Comments fee schedule to remove the Cross-Asset
• Use the Commission’s Internet Self-Regulatory Organizations; Bats Tier under footnote 1, Add Volume
comment form EDGX Exchange, Inc.; Notice of Filing Tiers.
(http://www.sec.gov/rules/sro.shtml); and Immediate Effectiveness of a
The Exchange determines the
or Proposed Rule Change to Fees for Use
liquidity adding rebate that it will
• Send an email to rule-comments@ of the Exchange’s Equities Platform
provide to Members using the
sec.gov. Please include File Number SR– December 7, 2016. Exchange’s tiered pricing structure.
FICC–2016–007 on the subject line. Pursuant to Section 19(b)(1) of the Currently, the Exchange provides
Paper Comments Securities Exchange Act of 1934 (the various rebates under footnote 1 of the
‘‘Act’’),1 and Rule 19b–4 thereunder,2 fee schedule for a Member dependent
• Send paper comments in triplicate notice is hereby given that on November on the Member’s ADV 6 as a percentage
to Secretary, Securities and Exchange 30, 2016, Bats EDGX Exchange, Inc. (the
Commission, 100 F Street NE.,
pmangrum on DSK3GDR082PROD with NOTICES

‘‘Exchange’’ or ‘‘EDGX’’) filed with the 3 15 U.S.C. 78s(b)(3)(A)(ii).
Washington, DC 20549–1090. Securities and Exchange Commission 4 17 CFR 240.19b–4(f)(2).
All submissions should refer to File (the ‘‘Commission’’) the proposed rule 5 The term ‘‘Member’’ is defined as ‘‘any

Number SR–FICC–2016–007. This file change as described in Items I, II, and registered broker or dealer that has been admitted
number should be included on the to membership in the Exchange.’’ See Exchange
Rule 1.5(n).
subject line if email is used. To help the 38 17 CFR 200.30–3(a)(12). 6 As defined in the Exchange’s fee schedule
Commission process and review your 1 15 U.S.C. 78s(b)(1). available at http://www.bats.com/us/equities/
comments more efficiently, please use 2 17 CFR 240.19b–4. membership/fee_schedule/edgx/.

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Document Created: 2016-12-13 02:44:54
Document Modified: 2016-12-13 02:44:54
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 90009