82 FR 28153 - Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing of a Proposed Rule Change To Adopt Rule 15.130 To Establish the Procedures for Resolving Potential Disputes Related to CAT Fees Charged to Industry Members
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 117 (June 20, 2017)
Federal Register Volume 82, Issue 117 (June 20, 2017)
| Page Range | 28153-28156 | |
| FR Document | 2017-12886 |
[Federal Register Volume 82, Number 117 (Tuesday, June 20, 2017)] [Notices] [Pages 28153-28156] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-12886] [[Page 28153]] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-80936; File No. SR-IEX-2017-21] Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing of a Proposed Rule Change To Adopt Rule 15.130 To Establish the Procedures for Resolving Potential Disputes Related to CAT Fees Charged to Industry Members June 15, 2017. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given that, on June 6, 2017, the Investors Exchange LLC (``IEX'' or the ``Exchange'') filed with the Securities and Exchange Commission (the ``Commission'' or ``SEC'') the proposed rule change as described in Items I and II below, which Items have been prepared by the self- regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 15 U.S.C. 78a. \3\ 17 CFR 240.19b-4. --------------------------------------------------------------------------- I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Exchange Act''),\4\ and Rule 19b-4 thereunder,\5\ Investors Exchange LLC (``IEX'' or ``Exchange'') is filing with the Commission a proposed rule change to adopt Rule 15.130 (Consolidated Audit Trail--Fee Dispute Resolution) to establish the procedures for resolving potential disputes related to CAT Fees charged to Industry Members.\6\ The text of the proposed rule change is available at the Exchange's Web site at www.iextrading.com, at the principal office of the Exchange, and at the Commission's Public Reference Room. --------------------------------------------------------------------------- \4\ 15 U.S.C. 78s(b)(1). \5\ 17 CFR 240.19b-4. \6\ 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. --------------------------------------------------------------------------- II. Self-Regulatory Organization's Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The self-regulatory organization 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 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,\7\ NASDAQ PHLX LLC, The NASDAQ Stock Market LLC, New York Stock Exchange LLC, NYSE MKT LLC, NYSE Arca, Inc. and NYSE National, Inc.\8\ (collectively, the ``Participants'') filed with the Commission, pursuant to Section 11A of the Exchange Act\9\ and Rule 608 of Regulation NMS thereunder,\10\ the National Market System Plan Governing the Consolidated Audit Trail (the ``CAT NMS Plan'' or ``Plan'').\11\ 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,\12\ and approved by the Commission, as modified, on November 15, 2016.\13\ 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.\14\ 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'').\15\ 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.\16\ Accordingly, IEX has filed a proposed rule change with the SEC to adopt the Consolidated Audit Trail Funding Fees, which will require Industry Members that are IEX members to pay the CAT Fees determined by the Operating Committee.\17\ IEX submits this rule filing to adopt Rule 15.130 (Consolidated Audit Trail--Fee Dispute Resolution) to establish the procedures for resolving potential disputes related to CAT Fees charged to Industry Members. Proposed Rule 15.130 is described below. --------------------------------------------------------------------------- \7\ 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). \8\ 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). \9\ 15 U.S.C. 78k-1. \10\ 17 CFR 242.608. \11\ 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. \12\ Securities Exchange Act Rel. No. 77724 (Apr. 27, 2016), 81 FR 30614 (May 17, 2016). \13\ Securities Exchange Act Rel. No. 79318 (Nov. 15, 2016), 81 FR 84696 (Nov. 23, 2016) (``Approval Order''). \14\ The Plan also serves as the limited liability company agreement for the Company. \15\ Section 11.1(b) of the CAT NMS Plan. \16\ Id. \17\ See SR-IEX-2017-03 [sic] filed with the Commission on May 3 [sic], 2017. --------------------------------------------------------------------------- (1) Definitions Paragraph (a) of Proposed Rule 15.130 sets forth the definitions for Proposed Rule 15.130. Paragraph (a)(1) of Proposed Rule 15.130 states that, for purposes of Rule 15.130, the terms ``CAT NMS Plan'', ``Industry Member'', ``Operating Committee'', and ``Participant'' are defined as set forth in the Rule 11.610 (Consolidated Audit Trail-- Definitions), and the term ``CAT Fee'' is defined as set forth in the Consolidated Audit Trail Funding Fees. In addition, IEX proposes to add paragraph (a)(2) to Proposed Rule 15.130. New paragraph (a)(2) would define the term ``Subcommittee'' to mean a subcommittee designated by the [[Page 28154]] 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 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. IEX proposes to adopt paragraph (b) of Proposed Rule 15.130. Paragraph (b) of Proposed Rule 15.130 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 15.130. 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 15.130. 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,\18\ and will be posted on the Web site for the CAT NMS Plan Web site.\19\ --------------------------------------------------------------------------- \18\ See, e.g., Chapter X of BATS BZX Exchange, Inc. (Adverse Action); and Chapter X of NYSE National, Inc. (Adverse Action). \19\ 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, [[Page 28155]] 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 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 IEX believes that the proposed rule change is consistent with the provisions Section 6(b)(5) of the Act,\20\ which require, among other things, that the 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 [sic], and Section 6(b)(4) of the Act,\21\ 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. --------------------------------------------------------------------------- \20\ 15 U.S.C. 78f(b)(5). \21\ 15 U.S.C. 78f(b)(4). --------------------------------------------------------------------------- IEX 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 IEX 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.'' \22\ To the extent that this proposal implements, interprets or clarifies the Plan and applies specific requirements to Industry Members, IEX believes that this proposal furthers the objectives of the Plan, as identified by the SEC, and is therefore consistent with the Act. --------------------------------------------------------------------------- \22\ Approval Order at 84697. --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition Section 6(b)(8) of the Act \23\ require [sic] that Exchange rules not impose any burden on competition that is not necessary or appropriate. IEX 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. IEX notes that the proposed rule change implements Section 11.5 of the CAT NMS Plan approved by the Commission, and is designed to assist IEX 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. --------------------------------------------------------------------------- \23\ 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-IEX-2017-21 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-IEX-2017-21. 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 28156]] 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-IEX-2017-21, and should be submitted on or before July 11, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\24\ --------------------------------------------------------------------------- \24\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017-12886 Filed 6-19-17; 8:45 am] BILLING CODE 8011-01-P
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SECURITIES AND EXCHANGE on the proposed rule change. The text modified, on November 15, 2016.13 The
COMMISSION of these statements may be examined at Plan is designed to create, implement
the places specified in Item IV below. and maintain a consolidated audit trail
[Release No. 34–80936; File No. SR–IEX–
The self-regulatory organization has (‘‘CAT’’) that would capture customer
2017–21]
prepared summaries, set forth in and order event information for orders
Self-Regulatory Organizations; Sections A, B, and C below, of the most in NMS Securities and OTC Equity
Investors Exchange LLC; Notice of significant aspects of such statements. Securities, across all markets, from the
Filing of a Proposed Rule Change To time of order inception through routing,
Adopt Rule 15.130 To Establish the A. Self-Regulatory Organization’s cancellation, modification, or execution
Procedures for Resolving Potential Statement of the Purpose of, and in a single consolidated data source.
Disputes Related to CAT Fees Charged Statutory Basis for, the Proposed Rule The Plan accomplishes this by creating
to Industry Members Change CAT NMS, LLC (the ‘‘Company’’), of
which each Participant is a member, to
June 15, 2017. 1. Purpose operate the CAT.14 Under the CAT NMS
Pursuant to Section 19(b)(1) 1 of the Bats BYX Exchange, Inc., Bats BZX Plan, the Operating Committee of the
Securities Exchange Act of 1934 (the Exchange, Inc., Bats EDGA Exchange, Company (‘‘Operating Committee’’) has
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 discretion to establish funding for the
Inc., Bats EDGX Exchange, Inc., BOX
notice is hereby given that, on June 6, Company to operate the CAT, including
Options Exchange LLC, C2 Options
2017, the Investors Exchange LLC establishing fees that the Participants
Exchange, Incorporated, Chicago Board will pay, and establishing fees for
(‘‘IEX’’ or the ‘‘Exchange’’) filed with the
Securities and Exchange Commission Options Exchange, Incorporated, Industry Members that will be
(the ‘‘Commission’’ or ‘‘SEC’’) the Chicago Stock Exchange, Inc., Financial implemented by the Participants (‘‘CAT
proposed rule change as described in Industry Regulatory Authority, Inc. Fees’’).15 The Participants are required
Items I and II below, which Items have (‘‘FINRA’’), Investors’ Exchange LLC, to file with the SEC under Section 19(b)
been prepared by the self-regulatory Miami International Securities of the Exchange Act any such CAT Fees
organization. The Commission is Exchange, LLC, MIAX PEARL, LLC, applicable to Industry Members that the
publishing this notice to solicit NASDAQ BX, Inc., Nasdaq GEMX, LLC, Operating Committee approves.16
comments on the proposed rule change Nasdaq ISE, LLC, Nasdaq MRX, LLC,7 Accordingly, IEX has filed a proposed
from interested persons. NASDAQ PHLX LLC, The NASDAQ rule change with the SEC to adopt the
Stock Market LLC, New York Stock Consolidated Audit Trail Funding Fees,
I. Self-Regulatory Organization’s which will require Industry Members
Exchange LLC, NYSE MKT LLC, NYSE
Statement of the Terms of Substance of that are IEX members to pay the CAT
Arca, Inc. and NYSE National, Inc.8
the Proposed Rule Change Fees determined by the Operating
(collectively, the ‘‘Participants’’) filed
Pursuant to Section 19(b)(1) of the with the Commission, pursuant to Committee.17 IEX submits this rule
Securities Exchange Act of 1934 Section 11A of the Exchange Act9 and filing to adopt Rule 15.130
(‘‘Exchange Act’’),4 and Rule 19b–4 Rule 608 of Regulation NMS (Consolidated Audit Trail—Fee Dispute
thereunder,5 Investors Exchange LLC thereunder,10 the National Market Resolution) to establish the procedures
(‘‘IEX’’ or ‘‘Exchange’’) is filing with the for resolving potential disputes related
System Plan Governing the
Commission a proposed rule change to to CAT Fees charged to Industry
Consolidated Audit Trail (the ‘‘CAT
adopt Rule 15.130 (Consolidated Audit Members. Proposed Rule 15.130 is
NMS Plan’’ or ‘‘Plan’’).11 The described below.
Trail—Fee Dispute Resolution) to
Participants filed the Plan to comply
establish the procedures for resolving (1) Definitions
potential disputes related to CAT Fees with Rule 613 of Regulation NMS under
charged to Industry Members.6 The text the Exchange Act. The Plan was Paragraph (a) of Proposed Rule 15.130
of the proposed rule change is available published for comment in the Federal sets forth the definitions for Proposed
at the Exchange’s Web site at Register on May 17, 2016,12 and Rule 15.130. Paragraph (a)(1) of
www.iextrading.com, at the principal approved by the Commission, as Proposed Rule 15.130 states that, for
office of the Exchange, and at the purposes of Rule 15.130, the terms
Commission’s Public Reference Room. 7 ISE Gemini, LLC, ISE Mercury, LLC and ‘‘CAT NMS Plan’’, ‘‘Industry Member’’,
International Securities Exchange, LLC have been ‘‘Operating Committee’’, and
II. Self-Regulatory Organization’s renamed Nasdaq GEMX, LLC, Nasdaq MRX, LLC,
‘‘Participant’’ are defined as set forth in
Statement of the Purpose of, and the and Nasdaq ISE, LLC, respectively. See Securities
Exchange Act Rel. No. 80248 (Mar. 15, 2017), 82 FR the Rule 11.610 (Consolidated Audit
Statutory Basis for, the Proposed Rule 14547 (Mar. 21, 2017); Securities Exchange Act Rel. Trail—Definitions), and the term ‘‘CAT
Change No. 80326 (Mar. 29, 2017), 82 FR 16460 (Apr. 4, Fee’’ is defined as set forth in the
2017); and Securities Exchange Act Rel. No. 80325
In its filing with the Commission, the (Mar. 29, 2017), 82 FR 16445 (Apr. 4, 2017).
Consolidated Audit Trail Funding Fees.
self-regulatory organization included 8 National Stock Exchange, Inc. has been renamed In addition, IEX proposes to add
statements concerning the purpose of NYSE National, Inc. See Securities Exchange Act paragraph (a)(2) to Proposed Rule
and basis for the proposed rule change Rel. No. 79902 (Jan. 30, 2017), 82 FR 9258 (Feb. 3, 15.130. New paragraph (a)(2) would
2017). define the term ‘‘Subcommittee’’ to
and discussed any comments it received 9 15 U.S.C. 78k–1.
10 17 CFR 242.608.
mean a subcommittee designated by the
1 15 U.S.C. 78s(b)(1). 11 See Letter from the Participants to Brent J.
sradovich on DSK3GMQ082PROD with NOTICES
2 15 U.S.C. 78a. 13 Securities Exchange Act Rel. No. 79318 (Nov.
Fields, Secretary, Commission, dated September 30,
3 17 CFR 240.19b–4.
2014; and Letter from Participants to Brent J. Fields, 15, 2016), 81 FR 84696 (Nov. 23, 2016) (‘‘Approval
4 15 U.S.C. 78s(b)(1).
Secretary, Commission, dated February 27, 2015. Order’’).
5 17 CFR 240.19b–4. 14 The Plan also serves as the limited liability
On December 24, 2015, the Participants submitted
6 Unless otherwise specified, capitalized terms an amendment to the CAT NMS Plan. See Letter company agreement for the Company.
15 Section 11.1(b) of the CAT NMS Plan.
used in this rule filing are defined as set forth from Participants to Brent J. Fields, Secretary,
herein, or in the Consolidated Audit Trail Funding Commission, dated December 23, 2015. 16 Id.
Fees Rule, the CAT Compliance Rule Series or in 12 Securities Exchange Act Rel. No. 77724 (Apr. 17 See SR–IEX–2017–03 [sic] filed with the
the CAT NMS Plan. 27, 2016), 81 FR 30614 (May 17, 2016). Commission on May 3 [sic], 2017.
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![Federal Register / Vol. 82, No. 117 / Tuesday, June 20, 2017 / Notices 28155
his or her place of business or by equitable principles of trade, and, in III. Date of Effectiveness of the
deposit in the United States post office, general, to protect investors and the Proposed Rule Change and Timing for
postage prepaid, by registered or public interest, and not designed to Commission Action
certified mail, addressed to the permit unfair discrimination between Within 45 days of the date of
applicant at its, his or her last known customers, issuers, brokers and dealer publication of this notice in the Federal
business or residence address. The [sic], and Section 6(b)(4) of the Act,21 Register or within such longer period
Procedures also state that any time which requires that Exchange rules up to 90 days (i) as the Commission may
limits imposed under the Procedures for provide for the equitable allocation of designate if it finds such longer period
the submission of answers, petitions or reasonable dues, fees, and other charges to be appropriate and publishes its
other materials may be extended by among members and issuers and other reasons for so finding or (ii) as to which
permission of the Operating Committee. persons using its facilities. the Exchange consents, the Commission
All papers and documents relating to IEX believes that this proposal is
will:
review by the Fee Review Subcommittee consistent with the Act because it
or the Operating Committee must be implements, interprets or clarifies (A) By order approve or disapprove
submitted to the Fee Review Section 11.5 of the Plan, and is designed such proposed rule change, or
Subcommittee or Operating Committee, to assist IEX and its Industry Members (B) institute proceedings to determine
as applicable. in meeting regulatory obligations whether the proposed rule change
The Procedures also note that pursuant to the Plan. In approving the should be disapproved.
decisions on such CAT Fee disputes Plan, the SEC noted that the Plan ‘‘is IV. Solicitation of Comments
made pursuant to these Procedures will necessary and appropriate in the public
be binding on Industry Members, Interested persons are invited to
interest, for the protection of investors
without prejudice to the rights of any submit written data, views, and
and the maintenance of fair and orderly
such Industry Member to seek redress arguments concerning the foregoing,
markets, to remove impediments to, and
from the SEC or in any other including whether the proposed rule
perfect the mechanism of a national
appropriate forum. change is consistent with the Act.
market system, or is otherwise in
Finally, an Industry Member that files Comments may be submitted by any of
furtherance of the purposes of the
a written application with the Company the following methods:
Act.’’ 22 To the extent that this proposal
regarding disputed CAT Fees in implements, interprets or clarifies the Electronic Comments
accordance with these Procedures is not Plan and applies specific requirements
required to pay such disputed CAT Fees • Use the Commission’s Internet
to Industry Members, IEX believes that comment form (http://www.sec.gov/
until the dispute is resolved in this proposal furthers the objectives of
accordance with these Procedures, rules/sro.shtml); or
the Plan, as identified by the SEC, and • Send an email to rule-comments@
including any review by the SEC or in is therefore consistent with the Act.
any other appropriate forum. For these sec.gov. Please include File Number SR–
purposes, the disputed CAT Fees means B. Self-Regulatory Organization’s IEX–2017–21 on the subject line.
the amount of the invoiced CAT Fees Statement on Burden on Competition Paper Comments
that the Industry Member has asserted Section 6(b)(8) of the Act 23 require • Send paper comments in triplicate
pursuant to these Procedures that such [sic] that Exchange rules not impose any to Secretary, Securities and Exchange
Industry Member does not owe to the burden on competition that is not Commission, 100 F Street NE.,
Company. The Industry Member must necessary or appropriate. IEX does not Washington, DC 20549–1090.
pay any invoiced CAT Fees that are not believe that the proposed rule change
disputed CAT Fees when due as set All submissions should refer to File
will result in any burden on
forth in the original invoice. Number SR–IEX–2017–21. This file
competition that is not necessary or
Once the dispute regarding CAT Fees number should be included on the
appropriate in furtherance of the
is resolved pursuant to these subject line if email is used. To help the
purposes of the Act. IEX notes that the
Procedures, if it is determined that the Commission process and review your
proposed rule change implements
Industry Member owes any of the comments more efficiently, please use
Section 11.5 of the CAT NMS Plan
disputed CAT Fees, then the Industry only one method. The Commission will
approved by the Commission, and is
Member must pay such disputed CAT post all comments on the Commission’s
designed to assist IEX in meeting its
Fees that are owed as well as interest on Internet Web site (http://www.sec.gov/
regulatory obligations pursuant to the
such disputed CAT Fees from the rules/sro.shtml). Copies of the
Plan. Similarly, all national securities
original due date (that is, 30 days after submission, all subsequent
exchanges and FINRA are proposing
receipt of the original invoice of such amendments, all written statements
this proposed rule to implement the
CAT Fees) until such disputed CAT with respect to the proposed rule
requirements of the CAT NMS Plan.
Fees are paid at a per annum rate equal change that are filed with the
Therefore, this is not a competitive rule
to the lesser of (i) the Prime Rate plus Commission, and all written
filing and, therefore, it does not raise
300 basis points, or (ii) the maximum communications relating to the
competition issues between and among
rate permitted by applicable law. proposed rule change between the
the exchanges and FINRA.
Commission and any person, other than
2. Statutory Basis C. Self-Regulatory Organization’s those that may be withheld from the
IEX believes that the proposed rule Statement on Comments on the public in accordance with the
Proposed Rule Change Received From provisions of 5 U.S.C. 552, will be
sradovich on DSK3GMQ082PROD with NOTICES
change is consistent with the provisions
Section 6(b)(5) of the Act,20 which Members, Participants, or Others available for Web site viewing and
require, among other things, that the Written comments were neither printing in the Commission’s Public
Exchange rules must be designed to solicited nor received. Reference Room, 100 F Street NE.,
prevent fraudulent and manipulative Washington, DC 20549, on official
acts and practices, to promote just and 21 15 U.S.C. 78f(b)(4). business days between the hours of
22 Approval Order at 84697. 10:00 a.m. and 3:00 p.m. Copies of the
20 15 U.S.C. 78f(b)(5). 23 15 U.S.C. 78f(b)(8) filing also will be available for
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![28156 Federal Register / Vol. 82, No. 117 / Tuesday, June 20, 2017 / Notices
inspection and copying at the principal limitations and conditions, to writing within 60 days of this
office of the Exchange. All comments whistleblowers who voluntarily provide publication. Please direct your written
received will be posted without change; the Commission with original comments to Pamela Dyson, Director/
the Commission does not edit personal information about a violation of the Chief Information Officer, Securities
identifying information from federal securities laws that leads to the and Exchange Commission, c/o Remi
submissions. You should submit only successful enforcement of a covered Pavlik-Simon, 100 F St. NE.,
information that you wish to make judicial or administrative action, or of a Washington, DC 20549; or send an email
available publicly. All submissions related action. The Rules define certain to: PRA_Mailbox@sec.gov.
should refer to File Number SR–IEX– terms critical to the operation of the Dated: June 15, 2017.
2017–21, and should be submitted on or whistleblower program, outline the
Eduardo A. Aleman,
before July 11, 2017. procedures for applying for awards and
the Commission’s procedures for Assistant Secretary.
For the Commission, by the Division of
making decisions on claims, and [FR Doc. 2017–12832 Filed 6–19–17; 8:45 am]
Trading and Markets, pursuant to delegated
authority.24 generally explain the scope of the BILLING CODE 8011–01–P
Eduardo A. Aleman, whistleblower program to the public
Assistant Secretary. and to potential whistleblowers.
Form TCR is a form submitted by SECURITIES AND EXCHANGE
[FR Doc. 2017–12886 Filed 6–19–17; 8:45 am] COMMISSION
whistleblowers who wish to provide
BILLING CODE 8011–01–P
information to the Commission and its
staff regarding potential violations of the Sunshine Act Meeting
SECURITIES AND EXCHANGE securities laws. Form TCR is required Notice is hereby given, pursuant to
COMMISSION for submission of information under the the provisions of the Government in the
Rules. The Commission estimates that it
Sunshine Act, Pub. L. 94–409, that the
Proposed Collection; Comment takes a whistleblower, on average, one
Securities and Exchange Commission
Request and one-half hours to complete Form
will hold a closed meeting on Thursday,
TCR. Based on the receipt of
Upon Written Request, Copies Available June 22, 2017 at 2 p.m.
approximately 700 annual responses on
From: Securities and Exchange average for the past three fiscal years, Commissioners, Counsel to the
Commission, Office of FOIA the Commission estimates that the Commissioners, the Secretary to the
Services, 100 F Street NE., annual PRA burden of Form TCR is Commission, and recording secretaries
Washington, DC 20549–2736. 1,050 hours. will attend the closed meeting. Certain
Extension: Form WB–APP is a form that is staff members who have an interest in
Implementing the Whistleblower submitted by whistleblowers filing a the matters also may be present.
Provisions of Section 21F of the claim for a whistleblower award. Form The General Counsel of the
Securities Exchange Act of 1934—Form WB–APP is required for application for Commission, or his designee, has
TCR and Form WB–APP, OMB Control an award under the Rules. The
No. 3235–0686, SEC File No. 270–625. certified that, in his opinion, one or
Commission estimates that it takes a more of the exemptions set forth in 5
Notice is hereby given that, pursuant whistleblower, on average, two hours to U.S.C. 552b(c)(3), (5), (7), 9(B) and (10)
to the Paperwork Reduction Act of 1995 complete Form WB–APP. The and 17 CFR 200.402(a)(3), (a)(5), (a)(7),
(44 U.S.C. 3501 et seq.), the Securities completion time depends largely on the (a)(9)(ii) and (a)(10), permit
and Exchange Commission complexity of the alleged violation and consideration of the scheduled matters
(‘‘Commission’’) is soliciting comments the amount of information the at the closed meeting.
on the collection of information whistleblower possesses in support of
summarized below. The Commission Chairman Clayton, as duty officer,
his or her application for an award.
plans to submit an extension for this voted to consider the items listed for the
Based on the receipt of approximately
current collection of information to the closed meeting in closed session.
150 annual responses on average for the
Office of Management and Budget for past three fiscal years, the Commission The subject matters of the closed
approval. estimates that the annual PRA burden of meeting will be:
In Release No. 34–64545,1 the Form WB–APP is 300 hours. The total Institution and settlement of
Commission adopted rules (‘‘Rules’’) estimated annual reporting burden for injunctive actions;
and forms to implement Section 21F of Form TCR and Form WB–APP is 1,350 Institution and settlement of
the Securities Exchange Act of 1934 hours. administrative proceedings; and
entitled ‘‘Securities Whistleblower Written comments are invited on: (a)
Incentives and Protection,’’ which was Whether this collection of information Other matters relating to enforcement
created by Section 922 of the Dodd- is necessary for the proper performance proceedings.
Frank Wall Street Reform and Consumer of the functions of the agency, including At times, changes in Commission
Protection Act (‘‘Dodd-Frank Act’’).2 whether the information will have priorities require alterations in the
The Rules describe the whistleblower practical utility; (b) the accuracy of the scheduling of meeting items.
program that the Commission has agency’s estimate of the burden imposed For further information and to
established pursuant to the Dodd-Frank by the collection of information; (c) ascertain what, if any, matters have been
Act which requires the Commission to ways to enhance the quality, utility, and added, deleted or postponed; please
clarity of the information collected; and
sradovich on DSK3GMQ082PROD with NOTICES
pay an award, subject to certain contact Brent J. Fields from the Office of
(d) ways to minimize the burden of the the Secretary at (202) 551–5400.
24 17 CFR 200.30–3(a)(12). collection of information on Dated: June 15, 2017.
1 Implementation of the Whistleblower Provisions respondents, including through the use
of Section 21F of the Securities Exchange Act of Brent J. Fields,
of automated collection techniques or
1934, Release No. 34–64545; File No. S7–33–10 Secretary.
(adopted May 25, 2011). other forms of information technology.
2 Public Law 111–203, 922(a), 124 Stat 1841 Consideration will be given to [FR Doc. 2017–12898 Filed 6–16–17; 11:15 am]
(2010). comments and suggestions submitted in BILLING CODE 8011–01–P
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Document Created: 2017-06-20 02:20:56
Document Modified: 2017-06-20 02:20:56
| 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 28153 |
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