82_FR_13948 82 FR 13899 - Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify the Qualified Contingent Cross and Solicitation Rebate Tiers

82 FR 13899 - Self-Regulatory Organizations; International Securities Exchange, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify the Qualified Contingent Cross and Solicitation Rebate Tiers

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 49 (March 15, 2017)

Page Range13899-13901
FR Document2017-05086

Federal Register, Volume 82 Issue 49 (Wednesday, March 15, 2017)
[Federal Register Volume 82, Number 49 (Wednesday, March 15, 2017)]
[Notices]
[Pages 13899-13901]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-05086]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80185; File No. SR-ISE-2017-17]


Self-Regulatory Organizations; International Securities Exchange, 
LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule 
Change To Modify the Qualified Contingent Cross and Solicitation Rebate 
Tiers

March 9, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on February 27, 2017, the International Securities Exchange, LLC 
(``ISE'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``SEC'' or ``Commission'') the proposed rule change as 
described in Items I and II, below, which Items have been prepared by 
the Exchange. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes a rule change to amend the Schedule of Fees 
to modify the Qualified Contingent Cross and Solicitation rebate tiers.
    The text of the proposed rule change is available on the Exchange's 
Web site at www.ise.com, at the principal office of the Exchange, and 
at the Commission's Public Reference Room.

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

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

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

1. Purpose
    Currently, members using QCC and/or other solicited crossing 
orders, including solicited orders executed in the Solicitation, 
Facilitation or Price Improvement Mechanisms, receive rebates for each 
originating contract side in all symbols traded on the Exchange. Once a 
member reaches a certain volume threshold in QCC orders and/or 
solicited crossing orders during a month, the Exchange provides rebates 
to that Member for all of its QCC and solicited crossing order traded 
contracts for that month. The applicable rebates are applied on QCC and 
solicited crossing order traded contracts once the volume threshold is 
met. Members receive the Non-``Customer to Customer'' rebate for all 
QCC and/or other solicited crossing orders except for QCC and solicited 
orders between two Priority Customers. QCC and solicited orders between 
two Priority Customers receive the ``Customer to Customer'' rebate or 
``Customer to Customer'' Rebate PLUS, respectively.\3\ Non-``Customer 
to Customer'' and ``Customer to Customer'' volume is aggregated in 
determining the applicable volume tier.

[[Page 13900]]

The current volume threshold and corresponding rebates are as follows:
---------------------------------------------------------------------------

    \3\ The PLUS rebate is for Members with total monthly 
unsolicited originating Facilitation contract side volume of 175,000 
or more.

----------------------------------------------------------------------------------------------------------------
                                                                                                 ``Customer to
               Originating contract sides                Non-``Customer to    ``Customer to    Customer'' rebate
                                                          Customer''rebate  Customer'' rebate         PLUS
----------------------------------------------------------------------------------------------------------------
0 to 99,999............................................              $0.00              $0.00              $0.00
100,000 to 199,999.....................................             (0.05)             (0.01)             (0.05)
200,000 to 499,999.....................................             (0.07)             (0.01)             (0.05)
500,000 to 699,999.....................................             (0.08)             (0.03)             (0.05)
700,000 to 999,999.....................................             (0.09)             (0.03)             (0.05)
1,000,000+.............................................             (0.11)             (0.03)             (0.05)
----------------------------------------------------------------------------------------------------------------

    The Exchange now proposes to make two changes to the QCC and 
Solicitation rebate. First, the Exchange proposes to aggregate volume 
from affiliates in determining the Member's tier for purposes of the 
QCC and Solicitation rebate. As proposed, all eligible volume from 
affiliated Members will be aggregated in determining QCC and 
Solicitation volume totals, provided there is at least 75% common 
ownership between the Members as reflected on each Member's Form BD, 
Schedule A. The Exchange believes that aggregating volume across 
Members that share at least 75% common ownership will allow Members to 
continue to execute trades on the Exchange through separate broker-
dealer entities for different types of volume, while receiving rebates 
based on the aggregate volume being executed across such entities. The 
Exchange currently aggregates volume from affiliated Members in 
determining applicable fees and rebates, including, for example, the 
Crossing Fee Cap,\4\ and believes that it is appropriate to now extend 
this treatment to the QCC and Solicitation rebate.
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 70873 (November 14, 
2013), 78 FR 69714 (November 20, 2013) (SR-ISE-2013-56).
---------------------------------------------------------------------------

    In addition, the Exchange proposes to eliminate the current tier 
4--i.e., from 500,000 to 699,999 originating contract sides--and merge 
this tier into current tier 5. With this proposed change, Members that 
execute between 500,000 and 999,999 originating contract sides of 
eligible volume will earn the current tier 5 rebates--i.e., a Non-
``Customer to Customer'' rebate of $0.09 per originating contract side, 
a ``Customer-to-Customer'' rebate of $0.03 per originating contract 
side and a ``Customer-to-Customer'' rebate PLUS of $0.05 per 
originating contract side. The Exchange believes that this change will 
incentivize members to execute more QCC and/or other solicited crossing 
orders on the Exchange in order to qualify for enhanced rebates. The 
new tier schedule and rebates are shown in the following table:

----------------------------------------------------------------------------------------------------------------
                                                         Non-``Customer to                       ``Customer to
               Originating contract sides                    Customer''       ``Customer to    Customer'' rebate
                                                               rebate       Customer'' rebate         PLUS
----------------------------------------------------------------------------------------------------------------
0 to 99,999............................................              $0.00              $0.00              $0.00
100,000 to 199,999.....................................             (0.05)             (0.01)             (0.05)
200,000 to 499,999.....................................             (0.07)             (0.01)             (0.05)
500,000 to 999,999.....................................             (0.09)             (0.03)             (0.05)
1,000,000+.............................................             (0.11)             (0.03)             (0.05)
----------------------------------------------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Act,\5\ in general, and Section 
6(b)(4) of the Act,\6\ in particular, in that it is designed to provide 
for the equitable allocation of reasonable dues, fees, and other 
charges among its members and other persons using its facilities.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

    The Exchange believes that it is reasonable, equitable, and not 
unfairly discriminatory to aggregate volume amongst corporate 
affiliates for purposes of the QCC and Solicitation rebate as this 
change is intended to avoid disparate treatment of firms that have 
divided their various business activities between separate corporate 
entities as compared to firms that operate those business activities 
within a single corporate entity. By way of example, many firms that 
are Members of the Exchange operate several different business lines 
within the same corporate entity. In contrast, other firms may be part 
of a corporate structure that separates those business lines into 
different corporate affiliates, either for business, compliance or 
historical reasons. Those corporate affiliates, in turn, are required 
to maintain separate memberships with the Exchange in order to access 
the Exchange. The Exchange currently aggregates volume executed by 
affiliates for other fees and rebates,\7\ and now proposes to similarly 
aggregate volume executed by affiliates for purposes of the QCC and 
Solicitation rebate. The proposed definition of ``affiliate'' to be 
used to aggregate volume for the QCC and Solicitation rebate is 
consistent with definitions used by the Exchange in other contexts.\8\
---------------------------------------------------------------------------

    \7\ See e.g., supra note 4.
    \8\ Id.
---------------------------------------------------------------------------

    In addition, the Exchange believes that the proposed changes to the 
QCC and Solicitation rebate tier schedule are reasonable and equitable 
as the proposed changes simplify the Exchange's tier structure, and 
provide more favorable rebates to members due to the reduced volume 
thresholds for achieving current tier 5 rebates. As explained above, 
the Exchange is eliminating the current tier 4 and merging it into 
current tier 5, thereby giving members a higher rebate for the same 
volume. The Exchange believes that this change will incentivize members 
to bring additional QCC and/or other solicited crossing order volume to 
the Exchange in order to benefit from the enhanced rebates. The 
Exchange also believes that the proposed changes

[[Page 13901]]

to the tier schedule are not unfairly discriminatory as all members 
will be able to attain higher rebates by executing the required volume 
of QCC and/or other solicited crossing orders on the Exchange.

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

    In accordance with Section 6(b)(8) of the Act,\9\ the Exchange does 
not believe that the proposed rule change will impose any burden on 
intermarket or intramarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. The proposed 
rule change merely allows for the aggregation of volume from affiliates 
for purposes of the QCC and Solicitation rebate, consistent with 
treatment of volume for other purposes in the Schedule of Fees, and 
with volume aggregation on other options markets. The Exchange operates 
in a highly competitive market in which market participants can readily 
direct their order flow to competing venues. In such an environment, 
the Exchange must continually review, and consider adjusting, its fees 
and rebates to remain competitive with other exchanges. For the reasons 
described above, the Exchange believes that the proposed fee changes 
reflect this competitive environment.
---------------------------------------------------------------------------

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

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 Act,\10\ and Rule 19b-4(f)(2) \11\ thereunder. 
At any time within 60 days of the filing of the proposed rule change, 
the Commission summarily may temporarily suspend such rule change if it 
appears to the Commission that such action is: (i) Necessary or 
appropriate in the public interest; (ii) for the protection of 
investors; or (iii) otherwise in furtherance of the purposes of the 
Act. If the Commission takes such action, the Commission shall 
institute proceedings to determine whether the proposed rule should be 
approved or disapproved.
---------------------------------------------------------------------------

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

IV. Solicitation of Comments

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

Electronic 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-ISE-2017-17 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-ISE-2017-17. 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 the 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-ISE-2017-17 and should be 
submitted on or before April 5, 2017.
---------------------------------------------------------------------------

    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-05086 Filed 3-14-17; 8:45 am]
BILLING CODE 8011-01-P



                                                                                    Federal Register / Vol. 82, No. 49 / Wednesday, March 15, 2017 / Notices                                                13899

                                                     C. Self-Regulatory Organization’s                       Commission and any person, other than                 I. Self-Regulatory Organization’s
                                                     Statement on Comments on the                            those that may be withheld from the                   Statement of the Terms of Substance of
                                                     Proposed Rule Change Received From                      public in accordance with the                         the Proposed Rule Change
                                                     Members, Participants, or Others                        provisions of 5 U.S.C. 552, will be                      The Exchange proposes a rule change
                                                       The Exchange has not solicited, and                   available for Web site viewing and                    to amend the Schedule of Fees to
                                                     does not intend to solicit, comments on                 printing in the Commission’s Public                   modify the Qualified Contingent Cross
                                                     this proposed rule change. The                          Reference Room, 100 F Street NE.,                     and Solicitation rebate tiers.
                                                     Exchange has not received any                           Washington, DC 20549, on official                        The text of the proposed rule change
                                                     unsolicited written comments from                       business days between the hours of                    is available on the Exchange’s Web site
                                                     Members or other interested parties.                    10:00 a.m. and 3:00 p.m. Copies of the                at www.ise.com, at the principal office
                                                     III. Date of Effectiveness of the                       filing also will be available for                     of the Exchange, and at the
                                                     Proposed Rule Change and Timing for                     inspection and copying at the principal               Commission’s Public Reference Room.
                                                     Commission Action                                       office of the Exchange. All comments                  II. Self-Regulatory Organization’s
                                                                                                             received will be posted without change;               Statement of the Purpose of, and
                                                        The foregoing rule change has become
                                                     effective pursuant to Section 19(b)(3)(A)               the Commission does not edit personal                 Statutory Basis for, the Proposed Rule
                                                     of the Act 17 and paragraph (f) of Rule                 identifying information from                          Change
                                                     19b–4 thereunder.18 At any time within                  submissions. You should submit only
                                                                                                             information that you wish to make                       In its filing with the Commission, the
                                                     60 days of the filing of the proposed rule                                                                    Exchange included statements
                                                     change, the Commission summarily may                    available publicly. All submissions
                                                                                                                                                                   concerning the purpose of and basis for
                                                     temporarily suspend such rule change if                 should refer to File No. SR–BatsEDGX–
                                                                                                                                                                   the proposed rule change and discussed
                                                     it appears to the Commission that such                  2017–12, and should be submitted on or
                                                                                                                                                                   any comments it received on the
                                                     action is necessary or appropriate in the               before April 5, 2017.
                                                                                                                                                                   proposed rule change. The text of these
                                                     public interest, for the protection of                    For the Commission, by the Division of              statements may be examined at the
                                                     investors, or otherwise in furtherance of               Trading and Markets, pursuant to delegated            places specified in Item IV below. The
                                                     the purposes of the Act.                                authority.19                                          Exchange has prepared summaries, set
                                                     IV. Solicitation of Comments                            Eduardo A. Aleman,                                    forth in sections A, B, and C below, of
                                                       Interested persons are invited to                     Assistant Secretary.                                  the most significant aspects of such
                                                     submit written data, views, and                         [FR Doc. 2017–05087 Filed 3–14–17; 8:45 am]           statements.
                                                     arguments concerning the foregoing,                     BILLING CODE 8011–01–P                                A. Self-Regulatory Organization’s
                                                     including whether the proposed rule                                                                           Statement of the Purpose of, and
                                                     change is consistent with the Act.                                                                            Statutory Basis for, the Proposed Rule
                                                     Comments may be submitted by any of                     SECURITIES AND EXCHANGE                               Change
                                                     the following methods:                                  COMMISSION
                                                                                                                                                                   1. Purpose
                                                     Electronic Comments
                                                                                                             [Release No. 34–80185; File No. SR–ISE–                  Currently, members using QCC and/or
                                                       • Use the Commission’s Internet                                                                             other solicited crossing orders,
                                                                                                             2017–17]
                                                     comment form (http://www.sec.gov/                                                                             including solicited orders executed in
                                                     rules/sro.shtml); or                                    Self-Regulatory Organizations;                        the Solicitation, Facilitation or Price
                                                       • Send an email to rule-comments@                                                                           Improvement Mechanisms, receive
                                                                                                             International Securities Exchange,
                                                     sec.gov. Please include File No. SR–                                                                          rebates for each originating contract side
                                                                                                             LLC; Notice of Filing and Immediate
                                                     BatsEDGX–2017–12 on the subject line.                                                                         in all symbols traded on the Exchange.
                                                                                                             Effectiveness of Proposed Rule
                                                     Paper Comments                                          Change To Modify the Qualified                        Once a member reaches a certain
                                                                                                                                                                   volume threshold in QCC orders and/or
                                                       • Send paper comments in triplicate                   Contingent Cross and Solicitation
                                                                                                             Rebate Tiers                                          solicited crossing orders during a
                                                     to Secretary, Securities and Exchange
                                                                                                                                                                   month, the Exchange provides rebates to
                                                     Commission, 100 F Street NE.,
                                                                                                             March 9, 2017.                                        that Member for all of its QCC and
                                                     Washington, DC 20549–1090.
                                                                                                                                                                   solicited crossing order traded contracts
                                                     All submissions should refer to File No.                   Pursuant to Section 19(b)(1) of the
                                                                                                                                                                   for that month. The applicable rebates
                                                     SR–BatsEDGX–2017–12. This file                          Securities Exchange Act of 1934
                                                                                                                                                                   are applied on QCC and solicited
                                                     number should be included on the                        (‘‘Act’’),1 and Rule 19b–4 thereunder,2               crossing order traded contracts once the
                                                     subject line if email is used. To help the              notice is hereby given that on February               volume threshold is met. Members
                                                     Commission process and review your                      27, 2017, the International Securities                receive the Non-‘‘Customer to
                                                     comments more efficiently, please use                   Exchange, LLC (‘‘ISE’’ or ‘‘Exchange’’)               Customer’’ rebate for all QCC and/or
                                                     only one method. The Commission will                    filed with the Securities and Exchange                other solicited crossing orders except for
                                                     post all comments on the Commission’s                   Commission (‘‘SEC’’ or ‘‘Commission’’)                QCC and solicited orders between two
                                                     Internet Web site (http://www.sec.gov/                  the proposed rule change as described                 Priority Customers. QCC and solicited
                                                     rules/sro.shtml). Copies of the                         in Items I and II, below, which Items                 orders between two Priority Customers
                                                     submission, all subsequent                              have been prepared by the Exchange.                   receive the ‘‘Customer to Customer’’
asabaliauskas on DSK3SPTVN1PROD with NOTICES2




                                                     amendments, all written statements                      The Commission is publishing this                     rebate or ‘‘Customer to Customer’’
                                                     with respect to the proposed rule                       notice to solicit comments on the                     Rebate PLUS, respectively.3 Non-
                                                     change that are filed with the                          proposed rule change from interested                  ‘‘Customer to Customer’’ and ‘‘Customer
                                                     Commission, and all written                             persons.                                              to Customer’’ volume is aggregated in
                                                     communications relating to the                                                                                determining the applicable volume tier.
                                                     proposed rule change between the
                                                                                                               19 17 CFR 200.30–3(a)(12).                            3 The PLUS rebate is for Members with total
                                                       17 15                                                   1 15 U.S.C. 78s(b)(1).
                                                             U.S.C. 78s(b)(3)(A).                                                                                  monthly unsolicited originating Facilitation
                                                       18 17 CFR 240.19b–4(f).                                 2 17 CFR 240.19b–4.                                 contract side volume of 175,000 or more.



                                                VerDate Sep<11>2014   18:19 Mar 14, 2017   Jkt 241001   PO 00000   Frm 00112   Fmt 4703   Sfmt 4703   E:\FR\FM\15MRN1.SGM   15MRN1


                                                     13900                                 Federal Register / Vol. 82, No. 49 / Wednesday, March 15, 2017 / Notices

                                                     The current volume threshold and
                                                     corresponding rebates are as follows:

                                                                                                                                                                                                                                      ‘‘Customer to
                                                                                                                                                                                     Non-‘‘Customer to        ‘‘Customer to
                                                                                                Originating contract sides                                                                                                          Customer’’ rebate
                                                                                                                                                                                     Customer’’rebate       Customer’’ rebate             PLUS

                                                     0 to 99,999 .................................................................................................................               $0.00                     $0.00               $0.00
                                                     100,000 to 199,999 ....................................................................................................                     (0.05)                    (0.01)              (0.05)
                                                     200,000 to 499,999 ....................................................................................................                     (0.07)                    (0.01)              (0.05)
                                                     500,000 to 699,999 ....................................................................................................                     (0.08)                    (0.03)              (0.05)
                                                     700,000 to 999,999 ....................................................................................................                     (0.09)                    (0.03)              (0.05)
                                                     1,000,000+ .................................................................................................................                (0.11)                    (0.03)              (0.05)



                                                        The Exchange now proposes to make                                      execute trades on the Exchange through                             Members that execute between 500,000
                                                     two changes to the QCC and Solicitation                                   separate broker-dealer entities for                                and 999,999 originating contract sides of
                                                     rebate. First, the Exchange proposes to                                   different types of volume, while                                   eligible volume will earn the current tier
                                                     aggregate volume from affiliates in                                       receiving rebates based on the aggregate                           5 rebates—i.e., a Non-‘‘Customer to
                                                     determining the Member’s tier for                                         volume being executed across such                                  Customer’’ rebate of $0.09 per
                                                     purposes of the QCC and Solicitation                                      entities. The Exchange currently                                   originating contract side, a ‘‘Customer-
                                                     rebate. As proposed, all eligible volume                                  aggregates volume from affiliated                                  to-Customer’’ rebate of $0.03 per
                                                     from affiliated Members will be                                           Members in determining applicable fees                             originating contract side and a
                                                     aggregated in determining QCC and                                         and rebates, including, for example, the                           ‘‘Customer-to-Customer’’ rebate PLUS of
                                                     Solicitation volume totals, provided                                      Crossing Fee Cap,4 and believes that it                            $0.05 per originating contract side. The
                                                                                                                               is appropriate to now extend this
                                                     there is at least 75% common                                                                                                                 Exchange believes that this change will
                                                                                                                               treatment to the QCC and Solicitation
                                                     ownership between the Members as                                          rebate.                                                            incentivize members to execute more
                                                     reflected on each Member’s Form BD,                                          In addition, the Exchange proposes to                           QCC and/or other solicited crossing
                                                     Schedule A. The Exchange believes that                                    eliminate the current tier 4—i.e., from                            orders on the Exchange in order to
                                                     aggregating volume across Members that                                    500,000 to 699,999 originating contract                            qualify for enhanced rebates. The new
                                                     share at least 75% common ownership                                       sides—and merge this tier into current                             tier schedule and rebates are shown in
                                                     will allow Members to continue to                                         tier 5. With this proposed change,                                 the following table:

                                                                                                                                                                                                                                      ‘‘Customer to
                                                                                                                                                                                     Non-‘‘Customer to        ‘‘Customer to
                                                                                                Originating contract sides                                                                                                          Customer’’ rebate
                                                                                                                                                                                     Customer’’ rebate      Customer’’ rebate             PLUS

                                                     0 to 99,999 .................................................................................................................               $0.00                     $0.00               $0.00
                                                     100,000 to 199,999 ....................................................................................................                     (0.05)                    (0.01)              (0.05)
                                                     200,000 to 499,999 ....................................................................................................                     (0.07)                    (0.01)              (0.05)
                                                     500,000 to 999,999 ....................................................................................................                     (0.09)                    (0.03)              (0.05)
                                                     1,000,000+ .................................................................................................................                (0.11)                    (0.03)              (0.05)



                                                     2. Statutory Basis                                                        corporate entity. By way of example,                               rebate is consistent with definitions
                                                                                                                               many firms that are Members of the                                 used by the Exchange in other contexts.8
                                                       The Exchange believes that the                                                                                                                In addition, the Exchange believes
                                                                                                                               Exchange operate several different
                                                     proposed rule change is consistent with                                                                                                      that the proposed changes to the QCC
                                                                                                                               business lines within the same
                                                     the provisions of Section 6 of the Act,5                                                                                                     and Solicitation rebate tier schedule are
                                                     in general, and Section 6(b)(4) of the                                    corporate entity. In contrast, other firms
                                                                                                                               may be part of a corporate structure that                          reasonable and equitable as the
                                                     Act,6 in particular, in that it is designed                                                                                                  proposed changes simplify the
                                                     to provide for the equitable allocation of                                separates those business lines into
                                                                                                                               different corporate affiliates, either for                         Exchange’s tier structure, and provide
                                                     reasonable dues, fees, and other charges                                                                                                     more favorable rebates to members due
                                                     among its members and other persons                                       business, compliance or historical
                                                                                                                                                                                                  to the reduced volume thresholds for
                                                     using its facilities.                                                     reasons. Those corporate affiliates, in
                                                                                                                                                                                                  achieving current tier 5 rebates. As
                                                       The Exchange believes that it is                                        turn, are required to maintain separate                            explained above, the Exchange is
                                                     reasonable, equitable, and not unfairly                                   memberships with the Exchange in                                   eliminating the current tier 4 and
                                                     discriminatory to aggregate volume                                        order to access the Exchange. The                                  merging it into current tier 5, thereby
                                                     amongst corporate affiliates for purposes                                 Exchange currently aggregates volume                               giving members a higher rebate for the
                                                     of the QCC and Solicitation rebate as                                     executed by affiliates for other fees and                          same volume. The Exchange believes
                                                     this change is intended to avoid                                          rebates,7 and now proposes to similarly                            that this change will incentivize
asabaliauskas on DSK3SPTVN1PROD with NOTICES2




                                                     disparate treatment of firms that have                                    aggregate volume executed by affiliates                            members to bring additional QCC and/
                                                     divided their various business activities                                 for purposes of the QCC and Solicitation                           or other solicited crossing order volume
                                                     between separate corporate entities as                                    rebate. The proposed definition of                                 to the Exchange in order to benefit from
                                                     compared to firms that operate those                                      ‘‘affiliate’’ to be used to aggregate                              the enhanced rebates. The Exchange
                                                     business activities within a single                                       volume for the QCC and Solicitation                                also believes that the proposed changes
                                                       4 See Securities Exchange Act Release No. 70873                            5 15   U.S.C. 78f.                                                7 See   e.g., supra note 4.
                                                     (November 14, 2013), 78 FR 69714 (November 20,                               6 15   U.S.C. 78f(b)(4).                                          8 Id.
                                                     2013) (SR–ISE–2013–56).



                                                VerDate Sep<11>2014         18:19 Mar 14, 2017         Jkt 241001      PO 00000       Frm 00113        Fmt 4703      Sfmt 4703       E:\FR\FM\15MRN1.SGM     15MRN1


                                                                                   Federal Register / Vol. 82, No. 49 / Wednesday, March 15, 2017 / Notices                                                  13901

                                                     to the tier schedule are not unfairly                    IV. Solicitation of Comments                             For the Commission, by the Division of
                                                     discriminatory as all members will be                                                                           Trading and Markets, pursuant to delegated
                                                     able to attain higher rebates by                           Interested persons are invited to                    authority.12
                                                     executing the required volume of QCC                     submit written data, views, and                        Eduardo A. Aleman,
                                                     and/or other solicited crossing orders on                arguments concerning the foregoing,                    Assistant Secretary.
                                                     the Exchange.                                            including whether the proposed rule
                                                                                                                                                                     [FR Doc. 2017–05086 Filed 3–14–17; 8:45 am]
                                                                                                              change is consistent with the Act.
                                                     B. Self-Regulatory Organization’s                        Comments may be submitted by any of                    BILLING CODE 8011–01–P
                                                     Statement on Burden on Competition                       the following methods:
                                                       In accordance with Section 6(b)(8) of                  Electronic Comments                                    SECURITIES AND EXCHANGE
                                                     the Act,9 the Exchange does not believe                                                                         COMMISSION
                                                     that the proposed rule change will                         • Use the Commission’s Internet
                                                     impose any burden on intermarket or                      comment form (http://www.sec.gov/                      [Release No. 34–80193; File No. SR–FINRA–
                                                     intramarket competition that is not                      rules/sro.shtml); or                                   2017–006]
                                                     necessary or appropriate in furtherance                    • Send an email to rule-comments@
                                                     of the purposes of the Act. The                          sec.gov. Please include File Number SR–                Self-Regulatory Organizations;
                                                     proposed rule change merely allows for                   ISE–2017–17 on the subject line.                       Financial Industry Regulatory
                                                     the aggregation of volume from affiliates                                                                       Authority, Inc.; Notice of Filing of a
                                                     for purposes of the QCC and Solicitation                 Paper Comments                                         Proposed Rule Change To Amend Rule
                                                     rebate, consistent with treatment of                                                                            6191 To Implement an Anonymous,
                                                     volume for other purposes in the                           • Send paper comments in triplicate
                                                                                                              to Secretary, Securities and Exchange                  Grouped Masking Methodology for
                                                     Schedule of Fees, and with volume                                                                               Over-the-Counter Activity in
                                                     aggregation on other options markets.                    Commission, 100 F Street NE.,
                                                                                                              Washington, DC 20549–1090.                             Connection With Web Site Data
                                                     The Exchange operates in a highly                                                                               Publication of Appendix B Data
                                                     competitive market in which market                       All submissions should refer to File                   Pursuant to the Regulation NMS Plan
                                                     participants can readily direct their                    Number SR–ISE–2017–17. This file                       To Implement a Tick Size Pilot
                                                     order flow to competing venues. In such                  number should be included on the                       Program
                                                     an environment, the Exchange must                        subject line if email is used. To help the
                                                     continually review, and consider                         Commission process and review your                     March 9, 2017.
                                                     adjusting, its fees and rebates to remain                comments more efficiently, please use                     Pursuant to Section 19(b)(1) of the
                                                     competitive with other exchanges. For                    only one method. The Commission will
                                                     the reasons described above, the                                                                                Securities Exchange Act of 1934
                                                                                                              post all comments on the Commission’s                  (‘‘Act’’) 1 and Rule 19b–4 thereunder,2
                                                     Exchange believes that the proposed fee                  Internet Web site (http://www.sec.gov/
                                                     changes reflect this competitive                                                                                notice is hereby given that on March 3,
                                                                                                              rules/sro.shtml). Copies of the                        2017, Financial Industry Regulatory
                                                     environment.
                                                                                                              submission, all subsequent                             Authority, Inc. (‘‘FINRA’’) filed with the
                                                     C. Self-Regulatory Organization’s                        amendments, all written statements                     Securities and Exchange Commission
                                                     Statement on Comments on the                             with respect to the proposed rule                      (‘‘SEC’’ or ‘‘Commission’’) the proposed
                                                     Proposed Rule Change Received From                       change that are filed with the                         rule change as described in Items I, II,
                                                     Members, Participants, or Others                         Commission, and all written                            and III below, which Items have been
                                                                                                              communications relating to the                         prepared by FINRA. The Commission is
                                                       No written comments were either                        proposed rule change between the
                                                     solicited or received.                                                                                          publishing this notice to solicit
                                                                                                              Commission and any person, other than                  comments on the proposed rule change
                                                     III. Date of Effectiveness of the                        those that may be withheld from the                    from interested persons.
                                                     Proposed Rule Change and Timing for                      public in accordance with the
                                                     Commission Action                                        provisions of 5 U.S.C. 552, will be                    I. Self-Regulatory Organization’s
                                                                                                              available for Web site viewing and                     Statement of the Terms of Substance of
                                                        The foregoing rule change has become                  printing in the Commission’s Public                    the Proposed Rule Change
                                                     effective pursuant to Section                            Reference Room, 100 F Street NE.,
                                                     19(b)(3)(A)(ii) of the Act,10 and Rule                                                                             FINRA is proposing to amend Rule
                                                                                                              Washington, DC 20549, on official                      6191 to implement an anonymous,
                                                     19b–4(f)(2) 11 thereunder. At any time                   business days between the hours of
                                                     within 60 days of the filing of the                                                                             grouped masking methodology for over-
                                                                                                              10:00 a.m. and 3:00 p.m. Copies of the                 the-counter (‘‘OTC’’) activity in
                                                     proposed rule change, the Commission
                                                                                                              filing also will be available for                      connection with Web site data
                                                     summarily may temporarily suspend
                                                                                                              inspection and copying at the principal                publication of Appendix B data
                                                     such rule change if it appears to the
                                                     Commission that such action is: (i)                      office of the Exchange. All comments                   pursuant to the Regulation NMS Plan to
                                                     Necessary or appropriate in the public                   received will be posted without change;                Implement a Tick Size Pilot Program
                                                     interest; (ii) for the protection of                     the Commission does not edit personal                  (‘‘Plan’’).
                                                     investors; or (iii) otherwise in                         identifying information from
                                                                                                                                                                        The text of the proposed rule change
asabaliauskas on DSK3SPTVN1PROD with NOTICES2




                                                     furtherance of the purposes of the Act.                  submissions. You should submit only
                                                                                                              information that you wish to make                      is available on FINRA’s Web site at
                                                     If the Commission takes such action, the                                                                        http://www.finra.org, at the principal
                                                     Commission shall institute proceedings                   available publicly. All submissions
                                                                                                              should refer to File Number SR–ISE–                    office of FINRA and at the
                                                     to determine whether the proposed rule
                                                                                                              2017–17 and should be submitted on or                  Commission’s Public Reference Room.
                                                     should be approved or disapproved.
                                                                                                              before April 5, 2017.
                                                       9 15 U.S.C. 78f(b)(8).
                                                       10 15                                                                                                           1 15   U.S.C. 78s(b)(1).
                                                             U.S.C. 78s(b)(3)(A)(ii).
                                                       11 17 CFR 240.19b–4(f)(2).                               12 17   CFR 200.30–3(a)(12).                           2 17   CFR 240.19b–4.



                                                VerDate Sep<11>2014    18:19 Mar 14, 2017   Jkt 241001   PO 00000   Frm 00114    Fmt 4703   Sfmt 4703   E:\FR\FM\15MRN1.SGM     15MRN1



Document Created: 2017-03-15 06:04:36
Document Modified: 2017-03-15 06:04:36
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 Citation82 FR 13899 

2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR