82 FR 38979 - Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Chapter VI, Section A of Its Pricing Schedule Relating to the Exchange's Monthly Permit Fees for PSX Only Members
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 157 (August 16, 2017)
Federal Register Volume 82, Issue 157 (August 16, 2017)
| Page Range | 38979-38981 | |
| FR Document | 2017-17276 |
[Federal Register Volume 82, Number 157 (Wednesday, August 16, 2017)] [Notices] [Pages 38979-38981] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-17276] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-81374; File No. SR-Phlx-2017-63] Self-Regulatory Organizations; NASDAQ PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Chapter VI, Section A of Its Pricing Schedule Relating to the Exchange's Monthly Permit Fees for PSX Only Members August 10, 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 July 31, 2017, NASDAQ PHLX LLC (``Phlx'' or ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``Commission'') the proposed rule change as described in Items I, II, and III, 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. --------------------------------------------------------------------------- [[Page 38980]] I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend Chapter VI, Section A of its Pricing Schedule relating to the Exchange's monthly permit fees for PSX only members. The text of the proposed rule change is available on the Exchange's Web site at http://nasdaqphlx.cchwallstreet.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 the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend Chapter VI, Section A of its Pricing Schedule to add a new exemption from the $4,000 per month ``PSX Only Permit Fee'' that the Exchange assesses to ``PSX only'' members and member organizations. A ``PSX only'' member or member organization is one that only does business only [sic] on PSX and not on the PHLX options market. Presently, the Exchange waives this Permit Fee if a PSX only member or member organization executes at least 1,000 shares per day, on average, in a given month. The Exchange proposes to also waive the Permit Fee during any month in which a PSX only member's or member organization's business on the Exchange is limited to ``clearing- only.'' For the purpose of the proposal, the term ``clearing-only'' means that the PSX only member or member organization: (1) Does not execute any trades on PSX throughout a given month; (2) maintains no active connections to execute trades on PSX during that month (either through its own MPID or through a sponsored access relationship on behalf of another member or member organization); and (3) maintains PSX membership for the sole purpose of clearing trades on behalf of another member or member organization that is actively trading on PSX. The purpose of the proposal is to enhance its fee structure for members and member organizations that limit their business on the Exchange during a given month to only clearing trades on behalf of others. The Exchange has determined that assessing clearing-only members and member organizations a monthly PSX Only Permit Fee is unnecessary given that the PSX Only Permit Fee exists for two purposes that do not apply to those that engage in clearing-only. First, the PSX Only Permit Fee serves as the price that members and member organizations pay for the privilege of executing trades on PSX. However, unlike other PSX members and member organizations, clearing firms do not obtain their PSX membership to execute trades and they do not, in fact, execute trades on PSX. The PSX Only Permit Fee also exists to defray the costs that the Exchange incurs to examine and oversee those of its members and member organizations for which the Exchange acts as the Designated Examination Authority. Again, however, the Exchange does not serve as the Designated Examination Authority for clearing-only firms and it therefore does not incur these costs. Moreover, the Exchange believes that the assessment of the monthly PSX Only Permit Fee to clearing-only members and member organizations serves as a disincentive for clearing firms to provide their valuable services to other Exchange members and member organizations. The Exchange wishes to encourage, rather than discourage, clearing firms to participate on the Exchange. Indeed, the Exchange hopes that waiving the PSX Only Permit Fee for clearing-only members and member organizations will not only attract new clearing firms to PSX, but it will also more generally attract additional trading participation and trading on PSX. This proposal is part of an effort to nurture the growth of PSX. 2. Statutory Basis The Exchange believes that its proposal is consistent with Section 6(b) of the Act,\3\ in general, and furthers the objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\4\ in particular, in that it provides for the equitable allocation of reasonable dues, fees and other charges among members and issuers and other persons using any facility, and is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers. --------------------------------------------------------------------------- \3\ 15 U.S.C. 78f(b). \4\ 15 U.S.C. 78f(b)(4) and (5). --------------------------------------------------------------------------- The Commission and the courts have repeatedly expressed their preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. In Regulation NMS, while adopting a series of steps to improve the current market model, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system ``has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.'' \5\ --------------------------------------------------------------------------- \5\ Securities Exchange Act Release No. 51808 (June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting Release''). --------------------------------------------------------------------------- Likewise, in NetCoalition v. Securities and Exchange Commission \6\ (``NetCoalition'') the D.C. Circuit upheld the Commission's use of a market-based approach in evaluating the fairness of market data fees against a challenge claiming that Congress mandated a cost-based approach.\7\ As the court emphasized, the Commission ``intended in Regulation NMS that `market forces, rather than regulatory requirements' play a role in determining the market data . . . to be made available to investors and at what cost.'' \8\ --------------------------------------------------------------------------- \6\ NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010). \7\ See NetCoalition, at 534-535. \8\ Id. at 537. --------------------------------------------------------------------------- Further, ``[n]o one disputes that competition for order flow is `fierce.' . . . As the SEC explained, `[i]n the U.S. national market system, buyers and sellers of securities, and the broker-dealers that act as their order-routing agents, have a wide range of choices of where to route orders for execution'; [and] `no exchange can afford to take its market share percentages for granted' because `no exchange possesses a monopoly, regulatory or otherwise, in the execution of order flow from broker dealers' . . . .'' \9\ Although the court and the SEC were discussing the cash equities markets, the Exchange believes that these views apply with equal force to the options markets. --------------------------------------------------------------------------- \9\ Id. at 539 (quoting Securities Exchange Act Release No. 59039 (December 2, 2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSEArca-2006-21)). --------------------------------------------------------------------------- The Exchange believes that waiving the monthly PSX Only Permit Fee for clearing-only members and member organization is reasonable because no justification exists for charging this Fee to members and member organizations that do not use their membership to execute trades on PSX and are not [[Page 38981]] subject to examination by the Exchange. The Exchange also believes that its definition of ``clearing-only'' is reasonable because it excludes those firms that are PSX members for purposes other than simply to clear transactions, those that execute even small volumes of trades during a given month, and even those that maintain an active capacity to execute trades during a month, either through its own MPID or through a sponsored access relationship. Finally, the Exchange proposes reasonable steps to ensure that those clearing firms that request waivers of the PSX Only Permit Fee in fact qualify for the waiver. It will require such firms to attest in writing to their ``clearing-only'' status as a condition of the Exchange granting them the waiver. The attestation form will also obligate firms to promptly notify the Exchange of any change in their statuses. The Exchange believes that the proposal is an equitable allocation and is not unfairly discriminatory because the Exchange will apply the same fee waiver to all similarly situated members and member organizations that utilize their membership on the Exchange only to engage in clearing activities. Moreover, the Exchange believes that its proposal does not discriminate against PSX only members and member organizations that execute trades on PSX because such members and member organizations can and typically do qualify for their own waivers of the monthly Permit Fee when, in a given month, they meet or exceed an average daily trading threshold of 1,000 shares. When PSX only members and member organizations do not meet or exceed this monthly trading threshold, the Exchange believes that it is justified in continuing to charge them the Permit Fee insofar as the transaction fees they generate for the Exchange are not sufficient to offset their shares of the Exchange's regulatory oversight costs.\10\ --------------------------------------------------------------------------- \10\ See also Securities Exchange Act Release No. 34-72784 (Aug. 7, 2014), 79 FR 47506 (Aug. 13, 2014) (discussing the Exchange's rationale for its existing PSX Only Permit Fee waiver). --------------------------------------------------------------------------- B. Self-Regulatory Organization's Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. In terms of inter-market competition, the Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues if they deem fee levels at a particular venue to be excessive, or rebate opportunities available at other venues to be more favorable. In such an environment, the Exchange must continually adjust its fees to remain competitive with other exchanges and with alternative trading systems that have been exempted from compliance with the statutory standards applicable to exchanges. Because competitors are free to modify their own fees in response, and because market participants may readily adjust their order routing practices, the Exchange believes that the degree to which fee changes in this market may impose any burden on competition is extremely limited. In this instance, the proposed waiver of the monthly PSX Only Permit Fee will not impose any burden on competition. To the contrary, the Exchange believes that its proposal is pro-competitive because it may encourage additional clearing firms to provide clearing services on the Exchange, which in turn may attract additional trading participants and trading activity. 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.\11\ --------------------------------------------------------------------------- \11\ 15 U.S.C. 78s(b)(3)(A)(ii). --------------------------------------------------------------------------- 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. 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-Phlx-2017-63 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-Phlx-2017-63. 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-Phlx-2017-63, and should be submitted on or before September 6, 2017. --------------------------------------------------------------------------- \12\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\12\ Robert W. Errett, Deputy Secretary. [FR Doc. 2017-17276 Filed 8-15-17; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 82, No. 157 / Wednesday, August 16, 2017 / Notices 38979
thereby promoting market transparency. and that will enhance competition Commission and any person, other than
The Exchange may halt trading during among market participants, to the those that may be withheld from the
the day in which an interruption to the benefit of investors and the marketplace. public in accordance with the
dissemination of the IOPV occurs, or the provisions of 5 U.S.C. 552, will be
C. Self-Regulatory Organization’s
value of the underlying Futures available for Web site viewing and
Statement on Comments on the
Contracts occurs. If the interruption to printing in the Commission’s Public
the dissemination of the IOPV or the Proposed Rule Change Received From
Members, Participants, or Others Reference Room, 100 F Street NE.,
value of the underlying Futures Washington, DC 20549 on official
Contracts persists past the trading day No written comments were solicited business days between the hours of
in which it occurred, the Exchange will or received with respect to the proposed 10:00 a.m. and 3:00 p.m. Copies of the
halt trading no later than the beginning rule change.
filing also will be available for
of the trading day following the III. Date of Effectiveness of the inspection and copying at the principal
interruption. If the Exchange becomes
Proposed Rule Change and Timing for office of the Exchange. All comments
aware that the NAV, the NAV per Share
Commission Action received will be posted without change;
and the Disclosed Portfolio with respect
to a series of Managed Trust Securities Within 45 days of the date of the Commission does not edit personal
are not disseminated to all market publication of this notice in the Federal identifying information from
participants at the same time, it will halt Register or up to 90 days (i) as the submissions. You should submit only
trading in such series until such time as Commission may designate if it finds information that you wish to make
the NAV, the NAV per Share and the such longer period to be appropriate available publicly. All submissions
Disclosed Portfolio are available to all and publishes its reasons for so finding should refer to File Number SR–
market participants. Trading in Shares or (ii) as to which the self-regulatory NYSEArca–2017–85 and should be
of the Trust will be halted if the circuit organization consents, the Commission submitted on or before September 6,
breaker parameters under NYSE Arca will: 2017.
Equities Rule 7.12 have been reached or (A) By order approve or disapprove For the Commission, by the Division of
because of market conditions or for the proposed rule change; or Trading and Markets, pursuant to delegated
reasons that, in the view of the (B) institute proceedings to determine authority.23
Exchange, make trading in the Shares whether the proposed rule change
should be disapproved. Robert W. Errett,
inadvisable. Moreover, prior to the
commencement of trading, the Exchange Deputy Secretary.
IV. Solicitation of Comments [FR Doc. 2017–17275 Filed 8–15–17; 8:45 am]
will inform its ETP Holders in the
Bulletin of the special characteristics Interested persons are invited to BILLING CODE 8011–01–P
and risks associated with trading the submit written data, views, and
Shares. arguments concerning the foregoing,
The proposed rule change is designed including whether the proposed rule SECURITIES AND EXCHANGE
to perfect the mechanism of a free and change is consistent with the Act. COMMISSION
open market and, in general, to protect Comments may be submitted by any of
investors and the public interest given the following methods: [Release No. 34–81374; File No. SR–Phlx–
that it will facilitate the listing and Electronic Comments 2017–63]
trading of an additional type of
exchange-traded product that will • Use the Commission’s Internet Self-Regulatory Organizations;
principally hold futures contracts and comment form (http://www.sec.gov/
NASDAQ PHLX LLC; Notice of Filing
that will enhance competition among rules/sro.shtml); or
and Immediate Effectiveness of
market participants, to the benefit of • Send an email to rule-comments@
sec.gov. Please include File Number SR– Proposed Rule Change To Amend
investors and the marketplace. As noted Chapter VI, Section A of Its Pricing
above, the Exchange has in place NYSEArca–2017–85 on the subject line.
Schedule Relating to the Exchange’s
surveillance procedures relating to Paper Comments Monthly Permit Fees for PSX Only
trading in the Shares and may obtain
information via the ISG from other • Send paper comments in triplicate Members
exchanges that are members of the ISG to Secretary, Securities and Exchange
August 10, 2017.
or with which the Exchange has entered Commission, 100 F Street NE.,
into a CSSA. In addition, as noted Washington, DC 20549–1090. Pursuant to Section 19(b)(1) of the
above, investors will have ready access All submissions should refer to File Securities Exchange Act of 1934
to information regarding the IOPV and Number SR–NYSEArca–2017–85. This (‘‘Act’’),1 and Rule 19b–4 thereunder,2
quotation and last sale information for file number should be included on the notice is hereby given that on July 31,
the Shares. subject line if email is used. To help the 2017, NASDAQ PHLX LLC (‘‘Phlx’’ or
Commission process and review your ‘‘Exchange’’) filed with the Securities
B. Self-Regulatory Organization’s comments more efficiently, please use and Exchange Commission (‘‘SEC’’ or
Statement on Burden on Competition only one method. The Commission will ‘‘Commission’’) the proposed rule
The Exchange does not believe that post all comments on the Commission’s change as described in Items I, II, and
asabaliauskas on DSKBBXCHB2PROD with NOTICES
the proposed rule change will impose Internet Web site (http://www.sec.gov/ III, below, which Items have been
any burden on competition that is not rules/sro.shtml). Copies of the prepared by the Exchange. The
necessary or appropriate in furtherance submission, all subsequent Commission is publishing this notice to
of the purposes of the Exchange Act. amendments, all written statements solicit comments on the proposed rule
The Exchange notes that the proposed with respect to the proposed rule change from interested persons.
rule change will facilitate the listing and change that are filed with the
trading of an additional type of actively- Commission, and all written 23 17 CFR 200.30–3(a)(12).
managed exchange-traded product that communications relating to the 1 15 U.S.C. 78s(b)(1).
will principally hold futures contracts, proposed rule change between the 2 17 CFR 240.19b–4.
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![38980 Federal Register / Vol. 82, No. 157 / Wednesday, August 16, 2017 / Notices
I. Self-Regulatory Organization’s sole purpose of clearing trades on behalf discrimination between customers,
Statement of the Terms of Substance of of another member or member issuers, brokers, or dealers.
the Proposed Rule Change organization that is actively trading on The Commission and the courts have
The Exchange proposes to amend PSX. repeatedly expressed their preference
Chapter VI, Section A of its Pricing The purpose of the proposal is to for competition over regulatory
Schedule relating to the Exchange’s enhance its fee structure for members intervention in determining prices,
monthly permit fees for PSX only and member organizations that limit products, and services in the securities
members. The text of the proposed rule their business on the Exchange during a markets. In Regulation NMS, while
change is available on the Exchange’s given month to only clearing trades on adopting a series of steps to improve the
Web site at http:// behalf of others. The Exchange has current market model, the Commission
nasdaqphlx.cchwallstreet.com/, at the determined that assessing clearing-only highlighted the importance of market
principal office of the Exchange, and at members and member organizations a forces in determining prices and SRO
the Commission’s Public Reference monthly PSX Only Permit Fee is revenues and, also, recognized that
Room. unnecessary given that the PSX Only current regulation of the market system
Permit Fee exists for two purposes that ‘‘has been remarkably successful in
II. Self-Regulatory Organization’s do not apply to those that engage in promoting market competition in its
Statement of the Purpose of, and clearing-only. First, the PSX Only broader forms that are most important to
Statutory Basis for, the Proposed Rule Permit Fee serves as the price that investors and listed companies.’’ 5
Change members and member organizations pay Likewise, in NetCoalition v. Securities
In its filing with the Commission, the for the privilege of executing trades on and Exchange Commission 6
Exchange included statements PSX. However, unlike other PSX (‘‘NetCoalition’’) the D.C. Circuit upheld
concerning the purpose of and basis for members and member organizations, the Commission’s use of a market-based
the proposed rule change and discussed clearing firms do not obtain their PSX approach in evaluating the fairness of
any comments it received on the membership to execute trades and they market data fees against a challenge
proposed rule change. The text of these do not, in fact, execute trades on PSX. claiming that Congress mandated a cost-
statements may be examined at the The PSX Only Permit Fee also exists to based approach.7 As the court
places specified in Item IV below. The defray the costs that the Exchange emphasized, the Commission ‘‘intended
Exchange has prepared summaries, set incurs to examine and oversee those of in Regulation NMS that ‘market forces,
forth in sections A, B, and C below, of its members and member organizations rather than regulatory requirements’
the most significant aspects of such for which the Exchange acts as the play a role in determining the market
statements. Designated Examination Authority. data . . . to be made available to
Again, however, the Exchange does not investors and at what cost.’’ 8
A. Self-Regulatory Organization’s serve as the Designated Examination Further, ‘‘[n]o one disputes that
Statement of the Purpose of, and the Authority for clearing-only firms and it competition for order flow is ‘fierce.’
Statutory Basis for, the Proposed Rule therefore does not incur these costs. . . . As the SEC explained, ‘[i]n the U.S.
Change Moreover, the Exchange believes that national market system, buyers and
1. Purpose the assessment of the monthly PSX Only sellers of securities, and the broker-
Permit Fee to clearing-only members dealers that act as their order-routing
The Exchange proposes to amend and member organizations serves as a
Chapter VI, Section A of its Pricing agents, have a wide range of choices of
disincentive for clearing firms to where to route orders for execution’;
Schedule to add a new exemption from provide their valuable services to other
the $4,000 per month ‘‘PSX Only Permit [and] ‘no exchange can afford to take its
Exchange members and member market share percentages for granted’
Fee’’ that the Exchange assesses to ‘‘PSX organizations. The Exchange wishes to
only’’ members and member because ‘no exchange possesses a
encourage, rather than discourage, monopoly, regulatory or otherwise, in
organizations. A ‘‘PSX only’’ member or clearing firms to participate on the
member organization is one that only the execution of order flow from broker
Exchange. Indeed, the Exchange hopes dealers’ . . . .’’ 9 Although the court
does business only [sic] on PSX and not that waiving the PSX Only Permit Fee
on the PHLX options market. and the SEC were discussing the cash
for clearing-only members and member equities markets, the Exchange believes
Presently, the Exchange waives this organizations will not only attract new
Permit Fee if a PSX only member or that these views apply with equal force
clearing firms to PSX, but it will also to the options markets.
member organization executes at least more generally attract additional trading
1,000 shares per day, on average, in a The Exchange believes that waiving
participation and trading on PSX. This the monthly PSX Only Permit Fee for
given month. The Exchange proposes to proposal is part of an effort to nurture
also waive the Permit Fee during any clearing-only members and member
the growth of PSX. organization is reasonable because no
month in which a PSX only member’s
or member organization’s business on 2. Statutory Basis justification exists for charging this Fee
the Exchange is limited to ‘‘clearing- to members and member organizations
The Exchange believes that its
only.’’ For the purpose of the proposal, that do not use their membership to
proposal is consistent with Section 6(b)
the term ‘‘clearing-only’’ means that the execute trades on PSX and are not
of the Act,3 in general, and furthers the
PSX only member or member objectives of Sections 6(b)(4) and 6(b)(5) 5 Securities Exchange Act Release No. 51808
asabaliauskas on DSKBBXCHB2PROD with NOTICES
organization: (1) Does not execute any of the Act,4 in particular, in that it (June 9, 2005), 70 FR 37496, 37499 (June 29, 2005)
trades on PSX throughout a given provides for the equitable allocation of (‘‘Regulation NMS Adopting Release’’).
month; (2) maintains no active reasonable dues, fees and other charges 6 NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir.
connections to execute trades on PSX among members and issuers and other 2010).
7 See NetCoalition, at 534–535.
during that month (either through its persons using any facility, and is not 8 Id. at 537.
own MPID or through a sponsored designed to permit unfair 9 Id. at 539 (quoting Securities Exchange Act
access relationship on behalf of another Release No. 59039 (December 2, 2008), 73 FR
member or member organization); and 3 15 U.S.C. 78f(b). 74770, 74782–83 (December 9, 2008) (SR–
(3) maintains PSX membership for the 4 15 U.S.C. 78f(b)(4) and (5). NYSEArca–2006–21)).
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![Federal Register / Vol. 82, No. 157 / Wednesday, August 16, 2017 / Notices 38981
subject to examination by the Exchange. rebate opportunities available at other Electronic Comments
The Exchange also believes that its venues to be more favorable. In such an
definition of ‘‘clearing-only’’ is environment, the Exchange must • Use the Commission’s Internet
reasonable because it excludes those continually adjust its fees to remain comment form (http://www.sec.gov/
firms that are PSX members for competitive with other exchanges and rules/sro.shtml); or
purposes other than simply to clear with alternative trading systems that • Send an email to rule-comments@
transactions, those that execute even have been exempted from compliance sec.gov. Please include File Number SR–
small volumes of trades during a given with the statutory standards applicable Phlx–2017–63 on the subject line.
month, and even those that maintain an to exchanges. Because competitors are
active capacity to execute trades during free to modify their own fees in Paper Comments
a month, either through its own MPID response, and because market • Send paper comments in triplicate
or through a sponsored access participants may readily adjust their to Secretary, Securities and Exchange
relationship. Finally, the Exchange order routing practices, the Exchange
proposes reasonable steps to ensure that Commission, 100 F Street NE.,
believes that the degree to which fee
those clearing firms that request waivers Washington, DC 20549–1090.
changes in this market may impose any
of the PSX Only Permit Fee in fact burden on competition is extremely All submissions should refer to File
qualify for the waiver. It will require limited. Number SR–Phlx–2017–63. This file
such firms to attest in writing to their number should be included on the
In this instance, the proposed waiver
‘‘clearing-only’’ status as a condition of subject line if email is used. To help the
of the monthly PSX Only Permit Fee
the Exchange granting them the waiver. Commission process and review your
will not impose any burden on
The attestation form will also obligate comments more efficiently, please use
competition. To the contrary, the
firms to promptly notify the Exchange of only one method. The Commission will
any change in their statuses. Exchange believes that its proposal is
pro-competitive because it may post all comments on the Commission’s
The Exchange believes that the
encourage additional clearing firms to Internet Web site (http://www.sec.gov/
proposal is an equitable allocation and
provide clearing services on the rules/sro.shtml). Copies of the
is not unfairly discriminatory because
Exchange, which in turn may attract submission, all subsequent
the Exchange will apply the same fee
waiver to all similarly situated members additional trading participants and amendments, all written statements
and member organizations that utilize trading activity. with respect to the proposed rule
their membership on the Exchange only change that are filed with the
C. Self-Regulatory Organization’s
to engage in clearing activities. Commission, and all written
Statement on Comments on the
Moreover, the Exchange believes that its communications relating to the
Proposed Rule Change Received From
proposal does not discriminate against Members, Participants, or Others proposed rule change between the
PSX only members and member Commission and any person, other than
organizations that execute trades on No written comments were either those that may be withheld from the
PSX because such members and solicited or received. public in accordance with the
member organizations can and typically provisions of 5 U.S.C. 552, will be
III. Date of Effectiveness of the
do qualify for their own waivers of the available for Web site viewing and
Proposed Rule Change and Timing for
monthly Permit Fee when, in a given printing in the Commission’s Public
month, they meet or exceed an average Commission Action
Reference Room, 100 F Street NE.,
daily trading threshold of 1,000 shares. The foregoing rule change has become Washington, DC 20549, on official
When PSX only members and member effective pursuant to Section business days between the hours of
organizations do not meet or exceed this 19(b)(3)(A)(ii) of the Act.11 10:00 a.m. and 3:00 p.m. Copies of the
monthly trading threshold, the filing also will be available for
Exchange believes that it is justified in At any time within 60 days of the
filing of the proposed rule change, the inspection and copying at the principal
continuing to charge them the Permit office of the Exchange. All comments
Fee insofar as the transaction fees they Commission summarily may
temporarily suspend such rule change if received will be posted without change;
generate for the Exchange are not the Commission does not edit personal
sufficient to offset their shares of the it appears to the Commission that such
action is: (i) Necessary or appropriate in identifying information from
Exchange’s regulatory oversight costs.10
the public interest; (ii) for the protection submissions. You should submit only
B. Self-Regulatory Organization’s of investors; or (iii) otherwise in information that you wish to make
Statement on Burden on Competition furtherance of the purposes of the Act. available publicly. All submissions
The Exchange does not believe that If the Commission takes such action, the should refer to File Number SR–Phlx–
the proposed rule change will impose Commission shall institute proceedings 2017–63, and should be submitted on or
any burden on competition not to determine whether the proposed rule before September 6, 2017.
necessary or appropriate in furtherance should be approved or disapproved. For the Commission, by the Division of
of the purposes of the Act. In terms of IV. Solicitation of Comments Trading and Markets, pursuant to delegated
inter-market competition, the Exchange authority.12
notes that it operates in a highly Interested persons are invited to
asabaliauskas on DSKBBXCHB2PROD with NOTICES
Robert W. Errett,
competitive market in which market submit written data, views, and Deputy Secretary.
participants can readily favor competing arguments concerning the foregoing, [FR Doc. 2017–17276 Filed 8–15–17; 8:45 am]
venues if they deem fee levels at a including whether the proposed rule
particular venue to be excessive, or BILLING CODE 8011–01–P
change is consistent with the Act.
Comments may be submitted by any of
10 See also Securities Exchange Act Release No.
the following methods:
34–72784 (Aug. 7, 2014), 79 FR 47506 (Aug. 13,
2014) (discussing the Exchange’s rationale for its
existing PSX Only Permit Fee waiver). 11 15 U.S.C. 78s(b)(3)(A)(ii). 12 17 CFR 200.30–3(a)(12).
VerDate Sep<11>2014 18:33 Aug 15, 2017 Jkt 241001 PO 00000 Frm 00107 Fmt 4703 Sfmt 9990 E:\FR\FM\16AUN1.SGM 16AUN1](https://thefederalregister.org/doc/82_FR_39136/page/3.svg)
Document Created: 2017-08-16 10:27:00
Document Modified: 2017-08-16 10:27:00
| 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 38979 |
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