82 FR 26549 - Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing of a Proposed Rule Change To Adopt Rule 4.17, Consolidated Audit Trail-Fee Dispute Resolution
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 108 (June 7, 2017)
Federal Register Volume 82, Issue 108 (June 7, 2017)
| Page Range | 26549-26552 | |
| FR Document | 2017-11746 |
[Federal Register Volume 82, Number 108 (Wednesday, June 7, 2017)] [Notices] [Pages 26549-26552] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-11746] [[Page 26549]] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-80835; File No. SR-BatsEDGA-2017-14] Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing of a Proposed Rule Change To Adopt Rule 4.17, Consolidated Audit Trail--Fee Dispute Resolution June 1, 2017. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ``Act'' or ``Exchange Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on May 23, 2017, Bats EDGA Exchange, Inc. (the ``Exchange'' or ``EDGA'') filed with the Securities and Exchange Commission (``Commission'' or ``SEC'') 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 filed a proposal to adopt Rule 4.17 (Consolidated Audit Trail--Fee Dispute Resolution) to establish the procedures for resolving potential disputes related to CAT Fees charged to Industry Members.\3\ --------------------------------------------------------------------------- \3\ Unless otherwise specified, capitalized terms used in this rule filing are defined as set forth herein, or in the Consolidated Audit Trail Funding Fees Rule, the CAT Compliance Rule Series or in the CAT NMS Plan. --------------------------------------------------------------------------- The text of the proposed rule change is available at the Exchange's Web site at www.bats.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 parts of such statements. A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose Bats BYX Exchange, Inc., Bats BZX Exchange, Inc., Bats EDGA Exchange, Inc., Bats EDGX Exchange, Inc., BOX Options Exchange LLC, C2 Options Exchange, Incorporated, Chicago Board Options Exchange, Incorporated, Chicago Stock Exchange, Inc., Financial Industry Regulatory Authority, Inc. (``FINRA''), Investors' Exchange LLC, Miami International Securities Exchange, LLC, MIAX PEARL, LLC, NASDAQ BX, Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC,\4\ NASDAQ PHLX LLC, The NASDAQ Stock Market LLC, New York Stock Exchange LLC, NYSE MKT LLC, NYSE Arca, Inc. and NYSE National, Inc.\5\ (collectively, the ``Participants'') filed with the Commission, pursuant to Section 11A of the Exchange Act \6\ and Rule 608 of Regulation NMS thereunder,\7\ the National Market System Plan Governing the Consolidated Audit Trail (the ``CAT NMS Plan'' or ``Plan'').\8\ The Participants filed the Plan to comply with Rule 613 of Regulation NMS under the Exchange Act. The Plan was published for comment in the Federal Register on May 17, 2016,\9\ and approved by the Commission, as modified, on November 15, 2016.\10\ The Plan is designed to create, implement and maintain a consolidated audit trail (``CAT'') that would capture customer and order event information for orders in NMS Securities and OTC Equity Securities, across all markets, from the time of order inception through routing, cancellation, modification, or execution in a single consolidated data source. The Plan accomplishes this by creating CAT NMS, LLC (the ``Company''), of which each Participant is a member, to operate the CAT.\11\ Under the CAT NMS Plan, the Operating Committee of the Company (``Operating Committee'') has discretion to establish funding for the Company to operate the CAT, including establishing fees that the Participants will pay, and establishing fees for Industry Members that will be implemented by the Participants (``CAT Fees'').\12\ The Participants are required to file with the SEC under Section 19(b) of the Exchange Act any such CAT Fees applicable to Industry Members that the Operating Committee approves.\13\ Accordingly, the Exchange has filed a proposed rule change with the SEC to adopt the Consolidated Audit Trail Funding Fees, which will require Industry Members that are Members of the Exchange to pay the CAT Fees determined by the Operating Committee.\14\ The Exchange submits this rule filing to adopt Rule 4.17 (Consolidated Audit Trail--Fee Dispute Resolution) to establish the procedures for resolving potential disputes related to CAT Fees charged to Industry Members. Proposed Rule 4.17 is described below. --------------------------------------------------------------------------- \4\ ISE Gemini, LLC, ISE Mercury, LLC and International Securities Exchange, LLC have been renamed Nasdaq GEMX, LLC, Nasdaq MRX, LLC, and Nasdaq ISE, LLC, respectively. See Securities Exchange Act Rel. No. 80248 (Mar. 15, 2017), 82 FR 14547 (Mar. 21, 2017); Securities Exchange Act Rel. No. 80326 (Mar. 29, 2017), 82 FR 16460 (Apr. 4, 2017); and Securities Exchange Act Rel. No. 80325 (Mar. 29, 2017), 82 FR 16445 (Apr. 4, 2017). \5\ National Stock Exchange, Inc. has been renamed NYSE National, Inc. See Securities Exchange Act Rel. No. 79902 (Jan. 30, 2017), 82 FR 9258 (Feb. 3, 2017). \6\ 15 U.S.C. 78k-1. \7\ 17 CFR 242.608. \8\ See Letter from the Participants to Brent J. Fields, Secretary, Commission, dated September 30, 2014; and Letter from Participants to Brent J. Fields, Secretary, Commission, dated February 27, 2015. On December 24, 2015, the Participants submitted an amendment to the CAT NMS Plan. See Letter from Participants to Brent J. Fields, Secretary, Commission, dated December 23, 2015. \9\ Securities Exchange Act Rel. No. 77724 (Apr. 27, 2016), 81 FR 30614 (May 17, 2016). \10\ Securities Exchange Act Rel. No. 79318 (Nov. 15, 2016), 81 FR 84696 (Nov. 23, 2016) (``Approval Order''). \11\ The Plan also serves as the limited liability company agreement for the Company. \12\ Section 11.1(b) of the CAT NMS Plan. \13\ Id. \14\ See Securities Exchange Act Release No. 80256 (March 15, 2017), 82 FR 10101 (March 21, 2017) (SR-BatsEDGA-2017-03) [sic]. --------------------------------------------------------------------------- (1) Definitions Paragraph (a) of Proposed Rule 4.17 sets forth the definitions for Proposed Rule 4.17. Paragraph (a)(1) of Proposed Rule 4.17 states that, for purposes of Rule 4.17, the terms ``CAT NMS Plan'', ``Industry Member'', ``Operating Committee'', and ``Participant'' are defined as set forth in the Rule 4.5 (Consolidated Audit Trail--Definitions), and the term ``CAT Fee'' is defined as set forth in the Consolidated Audit Trail Funding Fees. In addition, the Exchange proposes to add paragraph (a)(2) to Proposed Rule 4.17. New paragraph (a)(2) would define the term ``Subcommittee'' to mean a subcommittee designated by the Operating Committee pursuant to the CAT NMS Plan. This definition is the same substantive definition as set forth in Section 1.1 of the CAT NMS Plan. (2) Fee Dispute Resolution Section 11.5 of the CAT NMS Plan requires Participants to adopt rules requiring that disputes with respect to [[Page 26550]] fees charged to Industry Members pursuant to the CAT NMS Plan be determined by the Operating Committee or Subcommittee. Section 11.5 of the CAT NMS Plan also states that decisions by the Operating Committee or Subcommittee on such matters shall be binding on Industry Members, without prejudice to the right of any Industry Member to seek redress from the SEC pursuant to SEC Rule 608 or in any other appropriate forum. The Exchange proposes to adopt paragraph (b) of Proposed Rule 4.17. Paragraph (b) of Proposed Rule 4.17 states that disputes initiated by an Industry Member with respect to CAT Fees charged to such Industry Member pursuant to the Consolidated Audit Trail Funding Fees, including disputes related to the designated tier and the fee calculated pursuant to such tier, shall be resolved by the Operating Committee, or a Subcommittee designated by the Operating Committee, of the CAT NMS Plan, pursuant to the Fee Dispute Resolution Procedures adopted pursuant to the CAT NMS Plan and set forth in paragraph (c) of Proposed Rule 4.17. Decisions on such matters shall be binding on Industry Members, without prejudice to the rights of any such Industry Member to seek redress from the SEC or in any other appropriate forum. The Operating Committee has adopted ``Fee Dispute Resolution Procedures'' governing the manner in which disputes regarding CAT Fees charged pursuant to the Consolidated Audit Trail Funding Fees will be addressed. These Fee Dispute Resolution Procedures, as they relate to Industry Members, are set forth in paragraph (c) of Proposed Rule 4.17. Specifically, the Fee Dispute Resolution Procedures provide the procedure for Industry Members that dispute CAT Fees charged to such Industry Member pursuant to one or more of the Participants' Consolidated Audit Trail Funding Fees Rules, including disputes related to the designated tier and the fee calculated pursuant to such tier, to apply for an opportunity to be heard and to have the CAT Fees charged to such Industry Member reviewed. The Procedures are modeled after the adverse action procedures adopted by various exchanges,\15\ and will be posted on the Web site for the CAT NMS Plan Web site.\16\ --------------------------------------------------------------------------- \15\ See, e.g., Chapter X of Bats EDGA Exchange, Inc. (Adverse Action); and Chapter X of NYSE National, Inc. (Adverse Action). \16\ The CAT NMS Plan Web site is www.catnmsplan.com. --------------------------------------------------------------------------- Under these Procedures, an Industry Member that disputes CAT Fees charged to such Industry Member and that desires to have an opportunity to be heard with respect to such disputed CAT Fees must file a written application with the Company within 15 business days after being notified of such disputed CAT Fees. The application must identify the disputed CAT Fees, state the specific reasons why the applicant takes exception to such CAT Fees, and set forth the relief sought. In addition, if the applicant intends to submit any additional documents, statements, arguments or other material in support of the application, the same should be so stated and identified. The Company will refer applications for hearing and review promptly to the Subcommittee designated by the Operating Committee pursuant to Section 4.12 of the CAT NMS Plan with responsibility for conducting the reviews of CAT Fee disputes pursuant to these Procedures. This Subcommittee will be referred to as the Fee Review Subcommittee. The members of the Fee Review Subcommittee will be subject to the provisions of Section 4.3(d) of the CAT NMS Plan regarding recusal and Conflicts of Interest. The Fee Review Subcommittee will keep a record of the proceedings. The Fee Review Subcommittee will hold hearings promptly. The Fee Review Subcommittee will set a hearing date. The parties to the hearing shall furnish the Fee Review Subcommittee with all materials relevant to the proceedings at least 72 hours prior to the date of the hearing. Each party will have the right to inspect and copy the other party's materials prior to the hearing. The parties to the hearing will consist of the applicant and a representative of the Company who shall present the reasons for the action taken by the Company that allegedly aggrieved the applicant. The applicant is entitled to be accompanied, represented and advised by counsel at all stages of the proceedings. The Fee Review Subcommittee will determine all questions concerning the admissibility of evidence and will otherwise regulate the conduct of the hearing. Each of the parties will be permitted to make an opening statement, present witnesses and documentary evidence, cross examine opposing witnesses and present closing arguments orally or in writing as determined by the Fee Review Subcommittee. The Fee Review Subcommittee also will have the right to question all parties and witnesses to the proceeding. The Fee Review Subcommittee must keep a record of the hearing. The formal rules of evidence will not apply. The Fee Review Subcommittee must set forth its decision in writing and send the written decision to the parties to the proceeding. Such decisions will contain the reasons supporting the conclusions of the Fee Review Subcommittee. The decision of the Fee Review Subcommittee will be subject to review by the Operating Committee either on its own motion within 20 business days after issuance of the decision or upon written request submitted by the applicant within 15 business days after issuance of the decision. The applicant's petition must be in writing and must specify the findings and conclusions to which the applicant objects, together with the reasons for such objections. Any objection to a decision not specified in writing will be considered to have been abandoned and may be disregarded. Parties may petition to submit a written argument to the Operating Committee and may request an opportunity to make an oral argument before the Operating Committee. The Operating Committee will have sole discretion to grant or deny either request. The Operating Committee will conduct the review. The review will be made upon the record and will be made after such further proceedings, if any, as the Operating Committee may order. Based upon such record, the Operating Committee may affirm, reverse or modify, in whole or in part, the decision of the Fee Review Subcommittee. The decision of the Operating Committee will be in writing, will be sent to the parties to the proceeding and will be final. The Procedures state that a final decision regarding the disputed CAT Fees by the Operating Committee, or the Fee Review Subcommittee (if there is no review by the Operating Committee), must be provided within 90 days of the date on which the Industry Member filed a written application regarding disputed CAT Fees with the Company. The Operating Committee may extend the 90-day time limit at its discretion. In addition, the Procedures state that any notices or other documents may be served upon the applicant either personally or by leaving the same at its, his or her place of business or by deposit in the United States post office, postage prepaid, by registered or certified mail, addressed to the applicant at its, his or her last known business or residence address. The Procedures also state that any time limits imposed under the Procedures for the submission of answers, petitions or [[Page 26551]] other materials may be extended by permission of the Operating Committee. All papers and documents relating to review by the Fee Review Subcommittee or the Operating Committee must be submitted to the Fee Review Subcommittee or Operating Committee, as applicable. The Procedures also note that decisions on such CAT Fee disputes made pursuant to these Procedures will be binding on Industry Members, without prejudice to the rights of any such Industry Member to seek redress from the SEC or in any other appropriate forum. Finally, an Industry Member that files a written application with the Company regarding disputed CAT Fees in accordance with these Procedures is not required to pay such disputed CAT Fees until the dispute is resolved in accordance with these Procedures, including any review by the SEC or in any other appropriate forum. For these purposes, the disputed CAT Fees means the amount of the invoiced CAT Fees that the Industry Member has asserted pursuant to these Procedures that such Industry Member does not owe to the Company. The Industry Member must pay any invoiced CAT Fees that are not disputed CAT Fees when due as set forth in the original invoice. Once the dispute regarding CAT Fees is resolved pursuant to these Procedures, if it is determined that the Industry Member owes any of the disputed CAT Fees, then the Industry Member must pay such disputed CAT Fees that are owed as well as interest on such disputed CAT Fees from the original due date (that is, 30 days after receipt of the original invoice of such CAT Fees) until such disputed CAT Fees are paid at a per annum rate equal to the lesser of (i) the Prime Rate plus 300 basis points, or (ii) the maximum rate permitted by applicable law. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the provisions of Section 6(b)(5) of the Act,\17\ which require, among other things, that Exchange rules must be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest, and not designed to permit unfair discrimination between customers, issuers, brokers and dealer, and Section 15A(b)(5) [sic] of the Act,\18\ which requires that Exchange rules provide for the equitable allocation of reasonable dues, fees, and other charges among members and issuers and other persons using its facilities. --------------------------------------------------------------------------- \17\ 15 U.S.C. 78f(b)(5). \18\ 15 U.S.C. 78o-3(b)(5) [sic]. --------------------------------------------------------------------------- The Exchange believes that this proposal is consistent with the Act because it implements, interprets or clarifies Section 11.5 of the Plan, and is designed to assist the Exchange and its Industry Members in meeting regulatory obligations pursuant to the Plan. In approving the Plan, the SEC noted that the Plan ``is necessary and appropriate in the public interest, for the protection of investors and the maintenance of fair and orderly markets, to remove impediments to, and perfect the mechanism of a national market system, or is otherwise in furtherance of the purposes of the Act.'' \19\ To the extent that this proposal implements, interprets or clarifies the Plan and applies specific requirements to Industry Members, the Exchange believes that this proposal furthers the objectives of the Plan, as identified by the SEC, and is therefore consistent with the Act. --------------------------------------------------------------------------- \19\ Approval Order at 84697. --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition Section 6(b)(8) of the Act \20\ require [sic] that Exchange rules not impose any burden on competition that is not necessary or appropriate. The Exchange does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange notes that the proposed rule change implements Section 11.5 of the CAT NMS Plan approved by the Commission, and is designed to assist the Exchange in meeting its regulatory obligations pursuant to the Plan. Similarly, all national securities exchanges and FINRA are proposing this proposed rule to implement the requirements of the CAT NMS Plan. Therefore, this is not a competitive rule filing and, therefore, it does not raise competition issues between and among the exchanges and FINRA. --------------------------------------------------------------------------- \20\ 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 Written comments were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the Exchange consents, the Commission will: (A) By order approve or disapprove such proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-BatsEDGA-2017-14 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-BatsEDGA-2017-14. 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 [[Page 26552]] 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-BatsEDGA-2017-14, and should be submitted on or before June 28, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\21\ --------------------------------------------------------------------------- \21\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-11746 Filed 6-6-17; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 82, No. 108 / Wednesday, June 7, 2017 / Notices 26549
SECURITIES AND EXCHANGE A. Self-Regulatory Organization’s cancellation, modification, or execution
COMMISSION Statement of the Purpose of, and in a single consolidated data source.
Statutory Basis for, the Proposed Rule The Plan accomplishes this by creating
[Release No. 34–80835; File No. SR– Change CAT NMS, LLC (the ‘‘Company’’), of
BatsEDGA–2017–14] which each Participant is a member, to
1. Purpose
operate the CAT.11 Under the CAT NMS
Self-Regulatory Organizations; Bats Bats BYX Exchange, Inc., Bats BZX Plan, the Operating Committee of the
EDGA Exchange, Inc.; Notice of Filing Exchange, Inc., Bats EDGA Exchange, Company (‘‘Operating Committee’’) has
of a Proposed Rule Change To Adopt Inc., Bats EDGX Exchange, Inc., BOX discretion to establish funding for the
Rule 4.17, Consolidated Audit Trail— Options Exchange LLC, C2 Options Company to operate the CAT, including
Fee Dispute Resolution Exchange, Incorporated, Chicago Board establishing fees that the Participants
Options Exchange, Incorporated, will pay, and establishing fees for
June 1, 2017. Chicago Stock Exchange, Inc., Financial Industry Members that will be
Industry Regulatory Authority, Inc. implemented by the Participants (‘‘CAT
Pursuant to Section 19(b)(1) of the (‘‘FINRA’’), Investors’ Exchange LLC,
Securities Exchange Act of 1934 (the Fees’’).12 The Participants are required
Miami International Securities to file with the SEC under Section 19(b)
‘‘Act’’ or ‘‘Exchange Act’’),1 and Rule Exchange, LLC, MIAX PEARL, LLC,
19b–4 thereunder,2 notice is hereby of the Exchange Act any such CAT Fees
NASDAQ BX, Inc., Nasdaq GEMX, LLC, applicable to Industry Members that the
given that on May 23, 2017, Bats EDGA Nasdaq ISE, LLC, Nasdaq MRX, LLC,4
Exchange, Inc. (the ‘‘Exchange’’ or Operating Committee approves.13
NASDAQ PHLX LLC, The NASDAQ Accordingly, the Exchange has filed a
‘‘EDGA’’) filed with the Securities and Stock Market LLC, New York Stock
Exchange Commission (‘‘Commission’’ proposed rule change with the SEC to
Exchange LLC, NYSE MKT LLC, NYSE adopt the Consolidated Audit Trail
or ‘‘SEC’’) the proposed rule change as Arca, Inc. and NYSE National, Inc.5 Funding Fees, which will require
described in Items I and II below, which (collectively, the ‘‘Participants’’) filed Industry Members that are Members of
Items have been prepared by the with the Commission, pursuant to the Exchange to pay the CAT Fees
Exchange. The Commission is Section 11A of the Exchange Act 6 and determined by the Operating
publishing this notice to solicit Rule 608 of Regulation NMS Committee.14 The Exchange submits
comments on the proposed rule change thereunder,7 the National Market this rule filing to adopt Rule 4.17
from interested persons. System Plan Governing the (Consolidated Audit Trail—Fee Dispute
I. Self-Regulatory Organization’s Consolidated Audit Trail (the ‘‘CAT Resolution) to establish the procedures
Statement of the Terms of Substance of NMS Plan’’ or ‘‘Plan’’).8 The for resolving potential disputes related
the Proposed Rule Change Participants filed the Plan to comply to CAT Fees charged to Industry
with Rule 613 of Regulation NMS under Members. Proposed Rule 4.17 is
The Exchange filed a proposal to the Exchange Act. The Plan was described below.
adopt Rule 4.17 (Consolidated Audit published for comment in the Federal
Trail—Fee Dispute Resolution) to Register on May 17, 2016,9 and (1) Definitions
establish the procedures for resolving approved by the Commission, as Paragraph (a) of Proposed Rule 4.17
potential disputes related to CAT Fees modified, on November 15, 2016.10 The sets forth the definitions for Proposed
charged to Industry Members.3 Plan is designed to create, implement Rule 4.17. Paragraph (a)(1) of Proposed
The text of the proposed rule change and maintain a consolidated audit trail Rule 4.17 states that, for purposes of
is available at the Exchange’s Web site (‘‘CAT’’) that would capture customer Rule 4.17, the terms ‘‘CAT NMS Plan’’,
at www.bats.com, at the principal office and order event information for orders ‘‘Industry Member’’, ‘‘Operating
of the Exchange, and at the in NMS Securities and OTC Equity Committee’’, and ‘‘Participant’’ are
Commission’s Public Reference Room. Securities, across all markets, from the defined as set forth in the Rule 4.5
time of order inception through routing, (Consolidated Audit Trail—Definitions),
II. Self-Regulatory Organization’s and the term ‘‘CAT Fee’’ is defined as
Statement of the Purpose of, and 4 ISE Gemini, LLC, ISE Mercury, LLC and set forth in the Consolidated Audit Trail
Statutory Basis for, the Proposed Rule International Securities Exchange, LLC have been Funding Fees. In addition, the Exchange
renamed Nasdaq GEMX, LLC, Nasdaq MRX, LLC,
Change and Nasdaq ISE, LLC, respectively. See Securities proposes to add paragraph (a)(2) to
Exchange Act Rel. No. 80248 (Mar. 15, 2017), 82 FR Proposed Rule 4.17. New paragraph
In its filing with the Commission, the 14547 (Mar. 21, 2017); Securities Exchange Act Rel. (a)(2) would define the term
Exchange included statements No. 80326 (Mar. 29, 2017), 82 FR 16460 (Apr. 4, ‘‘Subcommittee’’ to mean a
concerning the purpose of and basis for 2017); and Securities Exchange Act Rel. No. 80325
(Mar. 29, 2017), 82 FR 16445 (Apr. 4, 2017). subcommittee designated by the
the proposed rule change and discussed 5 National Stock Exchange, Inc. has been renamed Operating Committee pursuant to the
any comments it received on the NYSE National, Inc. See Securities Exchange Act CAT NMS Plan. This definition is the
proposed rule change. The text of these Rel. No. 79902 (Jan. 30, 2017), 82 FR 9258 (Feb. 3, same substantive definition as set forth
statements may be examined at the 2017).
6 15 U.S.C. 78k–1. in Section 1.1 of the CAT NMS Plan.
places specified in Item IV below. The 7 17 CFR 242.608.
Exchange has prepared summaries, set (2) Fee Dispute Resolution
8 See Letter from the Participants to Brent J.
forth in Sections A, B, and C below, of Fields, Secretary, Commission, dated September 30, Section 11.5 of the CAT NMS Plan
the most significant parts of such 2014; and Letter from Participants to Brent J. Fields, requires Participants to adopt rules
statements. Secretary, Commission, dated February 27, 2015. requiring that disputes with respect to
sradovich on DSK3GMQ082PROD with NOTICES
On December 24, 2015, the Participants submitted
an amendment to the CAT NMS Plan. See Letter
1 15 11 The Plan also serves as the limited liability
U.S.C. 78s(b)(1). from Participants to Brent J. Fields, Secretary,
2 17CFR 240.19b–4. Commission, dated December 23, 2015. company agreement for the Company.
3 Unless otherwise specified, capitalized terms 9 Securities Exchange Act Rel. No. 77724 (Apr. 12 Section 11.1(b) of the CAT NMS Plan.
27, 2016), 81 FR 30614 (May 17, 2016). 13 Id.
used in this rule filing are defined as set forth
herein, or in the Consolidated Audit Trail Funding 10 Securities Exchange Act Rel. No. 79318 (Nov. 14 See Securities Exchange Act Release No. 80256
Fees Rule, the CAT Compliance Rule Series or in 15, 2016), 81 FR 84696 (Nov. 23, 2016) (‘‘Approval (March 15, 2017), 82 FR 10101 (March 21, 2017)
the CAT NMS Plan. Order’’). (SR–BatsEDGA–2017–03) [sic].
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other materials may be extended by the equitable allocation of reasonable III. Date of Effectiveness of the
permission of the Operating Committee. dues, fees, and other charges among Proposed Rule Change and Timing for
All papers and documents relating to members and issuers and other persons Commission Action
review by the Fee Review Subcommittee using its facilities. Within 45 days of the date of
or the Operating Committee must be publication of this notice in the Federal
The Exchange believes that this
submitted to the Fee Review Register or within such longer period
proposal is consistent with the Act
Subcommittee or Operating Committee,
because it implements, interprets or up to 90 days (i) as the Commission may
as applicable.
clarifies Section 11.5 of the Plan, and is designate if it finds such longer period
The Procedures also note that
decisions on such CAT Fee disputes designed to assist the Exchange and its to be appropriate and publishes its
made pursuant to these Procedures will Industry Members in meeting regulatory reasons for so finding or (ii) as to which
be binding on Industry Members, obligations pursuant to the Plan. In the Exchange consents, the Commission
without prejudice to the rights of any approving the Plan, the SEC noted that will:
such Industry Member to seek redress the Plan ‘‘is necessary and appropriate (A) By order approve or disapprove
from the SEC or in any other in the public interest, for the protection such proposed rule change, or
appropriate forum. (B) institute proceedings to determine
of investors and the maintenance of fair
Finally, an Industry Member that files whether the proposed rule change
and orderly markets, to remove
a written application with the Company should be disapproved.
impediments to, and perfect the
regarding disputed CAT Fees in mechanism of a national market system, IV. Solicitation of Comments
accordance with these Procedures is not or is otherwise in furtherance of the
required to pay such disputed CAT Fees Interested persons are invited to
purposes of the Act.’’ 19 To the extent submit written data, views, and
until the dispute is resolved in that this proposal implements,
accordance with these Procedures, arguments concerning the foregoing,
interprets or clarifies the Plan and including whether the proposed rule
including any review by the SEC or in
applies specific requirements to change is consistent with the Act.
any other appropriate forum. For these
purposes, the disputed CAT Fees means Industry Members, the Exchange Comments may be submitted by any of
the amount of the invoiced CAT Fees believes that this proposal furthers the the following methods:
that the Industry Member has asserted objectives of the Plan, as identified by
Electronic Comments
pursuant to these Procedures that such the SEC, and is therefore consistent with
the Act. • Use the Commission’s Internet
Industry Member does not owe to the
comment form (http://www.sec.gov/
Company. The Industry Member must B. Self-Regulatory Organization’s rules/sro.shtml); or
pay any invoiced CAT Fees that are not Statement on Burden on Competition • Send an email to rule-comments@
disputed CAT Fees when due as set
sec.gov. Please include File Number SR–
forth in the original invoice. Section 6(b)(8) of the Act 20 require
Once the dispute regarding CAT Fees BatsEDGA–2017–14 on the subject line.
[sic] that Exchange rules not impose any
is resolved pursuant to these burden on competition that is not Paper Comments
Procedures, if it is determined that the necessary or appropriate. The Exchange • Send paper comments in triplicate
Industry Member owes any of the does not believe that the proposed rule to Secretary, Securities and Exchange
disputed CAT Fees, then the Industry change will result in any burden on Commission, 100 F Street NE.,
Member must pay such disputed CAT competition that is not necessary or Washington, DC 20549–1090.
Fees that are owed as well as interest on appropriate in furtherance of the
such disputed CAT Fees from the All submissions should refer to File
purposes of the Act. The Exchange notes Number SR–BatsEDGA–2017–14. This
original due date (that is, 30 days after
that the proposed rule change file number should be included on the
receipt of the original invoice of such
CAT Fees) until such disputed CAT implements Section 11.5 of the CAT subject line if email is used. To help the
Fees are paid at a per annum rate equal NMS Plan approved by the Commission, Commission process and review your
to the lesser of (i) the Prime Rate plus and is designed to assist the Exchange comments more efficiently, please use
300 basis points, or (ii) the maximum in meeting its regulatory obligations only one method. The Commission will
rate permitted by applicable law. pursuant to the Plan. Similarly, all post all comments on the Commission’s
national securities exchanges and Internet Web site (http://www.sec.gov/
2. Statutory Basis FINRA are proposing this proposed rule rules/sro.shtml). Copies of the
The Exchange believes that the to implement the requirements of the submission, all subsequent
proposed rule change is consistent with CAT NMS Plan. Therefore, this is not a amendments, all written statements
the provisions of Section 6(b)(5) of the competitive rule filing and, therefore, it with respect to the proposed rule
Act,17 which require, among other does not raise competition issues change that are filed with the
things, that Exchange rules must be between and among the exchanges and Commission, and all written
designed to prevent fraudulent and FINRA. communications relating to the
manipulative acts and practices, to proposed rule change between the
promote just and equitable principles of C. Self-Regulatory Organization’s Commission and any person, other than
trade, and, in general, to protect Statement on Comments on the those that may be withheld from the
investors and the public interest, and Proposed Rule Change Received From public in accordance with the
provisions of 5 U.S.C. 552, will be
sradovich on DSK3GMQ082PROD with NOTICES
not designed to permit unfair Members, Participants or Others
discrimination between customers, available for Web site viewing and
issuers, brokers and dealer, and Section Written comments were neither printing in the Commission’s Public
15A(b)(5) [sic] of the Act,18 which solicited nor received. Reference Room, 100 F Street NE.,
requires that Exchange rules provide for Washington, DC 20549, on official
business days between the hours of
17 15 U.S.C. 78f(b)(5). 19 Approval Order at 84697. 10:00 a.m. and 3:00 p.m. Copies of the
18 15 U.S.C. 78o–3(b)(5) [sic]. 20 15 U.S.C. 78f(b)(8). filing also will be available for
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![26552 Federal Register / Vol. 82, No. 108 / Wednesday, June 7, 2017 / Notices
inspection and copying at the principal book quotations for all displayed orders disseminated over IEX DEEP.4
office of the Exchange. All comments resting on the Order Book disseminated Accordingly, the Exchange proposes to
received will be posted without change; on the IEX Data Platform; and to add amend Rule 11.330(a)(2) to offer
the Commission does not edit personal Rule 11.330(a)(5) to offer Historical Data aggregated depth of book quotations on
identifying information from (‘‘HIST’’), an additional data product the IEX Data Platform for all displayed
submissions. You should submit only that offers historical data. The Exchange orders resting on the Order Book at each
information that you wish to make has designated this proposal as non- price level, rather than providing only
available publicly. All submissions controversial and provided the ten (10) price levels. The IEX Data
should refer to File Number SR– Commission with the notice required by Platform will continue to offer
BatsEDGA–2017–14, and should be Rule 19b–4(f)(6)(iii) under the Act. aggregated top of book quotations for all
submitted on or before June 28, 2017. displayed orders resting on the Order
The text of the proposed rule change
For the Commission, by the Division of is available at the Exchange’s Web site Book, and execution information (i.e.,
Trading and Markets, pursuant to delegated at www.iextrading.com, at the principal last sale information) for executions on
authority.21
office of the Exchange, and at the the Exchange. Furthermore, the IEX
Eduardo A. Aleman,
Commission’s Public Reference Room. Data Platform will continue to be
Assistant Secretary. provided free of charge. In addition,
[FR Doc. 2017–11746 Filed 6–6–17; 8:45 am] II. Self-Regulatory Organization’s after informal discussions with market
BILLING CODE 8011–01–P Statement of the Purpose of, and the participants and other users, the
Statutory Basis for, the Proposed Rule Exchange has determined that there is
Change demand for historical market data
SECURITIES AND EXCHANGE related to quotations and transaction
COMMISSION In its filing with the Commission, the information on the Exchange.
self-regulatory organization included Accordingly, the Exchange is proposing
[Release No. 34–80845; File No. SR–IEX– statements concerning the purpose of
2017–19]
to offer HIST, a data product that offers
and basis for the proposed rule change historical data for download from the
Self-Regulatory Organizations; and discussed any comments it received Exchange’s public Web site. HIST will
Investors Exchange LLC; Notice of on the proposed rule change. The text include the same substantive data that
Filing and Immediate Effectiveness of of these statements may be examined at is provided in real time via TOPS and
Proposed Rule Change To Remove the the places specified in Item IV below. DEEP on a T+1 basis via the Exchange’s
Ten (10) Price Level Limitation on The self-regulatory organization has public Web site, free of charge.
Aggregated Depth of Book Quotations prepared summaries, set forth in As is the case currently with respect
Disseminated on the IEX Data Sections A, B, and C below, of the most to TOPS, DEEP and the IEX Data
Platform, and To Add Rule 11.330(a)(5) significant aspects of such statements. Platform, the aggregated best bid and
To Offer Historical Data offer (‘‘BBO’’) and last sale information
A. Self-Regulatory Organization’s
disseminated through the proposed IEX
June 1, 2017. Statement of the Purpose of, and the
Data Platform will be reported under the
Pursuant to Section 19(b)(1) 1 of the Statutory Basis for, the Proposed Rule
Consolidated Tape Association (‘‘CTA’’)
Securities Exchange Act of 1934 (the Change
Plan or the Nasdaq/UTP Plan. The
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 1. Purpose Exchange will release such information
notice is hereby given that, on May 23, to the IEX Data Platform in compliance
2017, the Investors Exchange LLC The Exchange proposes to amend with Rule 603(a) of Regulation NMS,
(‘‘IEX’’ or the ‘‘Exchange’’) filed with the Rule 11.330(a)(2) to remove the ten (10) which requires that exchanges distribute
Securities and Exchange Commission price level limitation on aggregated market data on terms that are ‘‘fair and
(the ‘‘Commission’’) the proposed rule depth of book quotations for all reasonable’’ and ‘‘not unreasonably
change as described in Items I and II displayed orders resting on the Order discriminatory,’’ and prohibits an
below, which Items have been prepared Book disseminated on the IEX Data exchange from releasing data relating to
by the self-regulatory organization. The Platform; and to add Rule 11.330(a)(5) to quotes and trades to its customers
Commission is publishing this notice to offer Historical Data (‘‘HIST’’), an through proprietary feeds before it sends
solicit comments on the proposed rule additional data product that offers its quotes and trade reports for inclusion
change from interested persons. historical data. Currently, Rule in the consolidated feeds.5
I. Self-Regulatory Organization’s 11.330(a)(2) states that the IEX Data The Exchange plans to implement the
Statement of the Terms of Substance of Platform is a data feed, available proposed changes on May 15, 2017,
the Proposed Rule Change through the Exchange’s public Web site, which is the scheduled launch date of
that offers aggregated top of book IEX DEEP, and the IEX Data Platform.6
Pursuant to the provisions of Section quotations for all displayed orders
19(b)(1) under the Securities Exchange resting on the Order Book, aggregated 2. Statutory Basis
Act of 1934 (‘‘Act’’), and Rule 19b–4 depth of book quotations for all IEX believes that the proposed rule
thereunder, Investors Exchange LLC displayed orders resting on the Order change is consistent with the provisions
(‘‘IEX’’ or the ‘‘Exchange’’) is filing with Book for up to ten (10) price levels, and
the Securities and Exchange execution information (i.e., last sale 4 See IEX Rule 11.330(a)(3), describing IEX DEEP.
Commission (‘‘Commission’’) a information) for executions on the 5 See Regulation NMS, 70 FR 37,496, 37,567 (June
sradovich on DSK3GMQ082PROD with NOTICES
proposed rule change to amend Rule Exchange. The Exchange believes that 29, 2005) (adopting release); see also Concept
11.330(a)(2) to remove the ten (10) price market participants that make use of the
Release, 75 FR at 3601 (January 21, 2010).
6 See IEX Trading Alert #2017–011, April 19,
level limitation on aggregated depth of IEX Data Platform would benefit from 2017 (https://www.iextrading.com/trading/alerts/
21 17
receiving all aggregated depth of book 2017/011/). The Commission notes that the
CFR 200.30–3(a)(12). Exchange originally filed the proposed rule change
1 15 U.S.C. 78s(b)(1).
quotations for all orders resting on the
on May 12, 2017 (SR–IEX–2017–17) but withdrew
2 15 U.S.C. 78a. Order Book at every price level, in the that filing and replaced it with the current filing on
3 17 CFR 240.19b–4. same manner that such information is May 23, 2017.
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Document Created: 2017-06-07 02:01:05
Document Modified: 2017-06-07 02:01:05
| 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 | 82 FR 26549 |
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