82 FR 43433 - Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Modify the NYSE American Options Fee Schedule

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 178 (September 15, 2017)

Page Range		43433-43436
FR Document		2017-19584
Federal Register, Volume 82 Issue 178 (Friday, September 15, 2017)
[Federal Register Volume 82, Number 178 (Friday, September 15, 2017)]
[Notices]
[Pages 43433-43436]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-19584]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81569; File No. SR-NYSEAMER-2017-13]


Self-Regulatory Organizations; NYSE American LLC; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Modify 
the NYSE American Options Fee Schedule

September 11, 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 September 1, 2017, NYSE American LLC (the ``Exchange'' 
or ``NYSE American'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I, 
II, and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to modify the NYSE American Options Fee 
Schedule (``Fee Schedule''). The Exchange proposes to implement the fee 
change effective September 1, 2017. The proposed change is available on 
the Exchange's Web site at www.nyse.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 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 those 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this filing is to modify the Fee Schedule, effective 
September 1, 2017. Specifically, the Exchange proposes to amend the 
American Customer Engagement (``ACE'') Program to modify various 
credits offered and to establish certain credits provided depending on 
the type of Electronic transactions (e.g., whether it is a simple or 
complex execution). The Exchange also proposes to add ``Simple Order'' 
to the glossary of defined terms in the Fee Schedule.
    Section I.E. of the Fee Schedule describes the Exchange's ACE 
Program. The ACE Program features a base tier and five higher tiers 
expressed as a percentage of TCADV \4\ and provides two alternative 
methods by which Order Flow Providers (each an ``OFP'') may receive per 
contract credits for Electronic Customer volume that the OFP, as agent, 
submits to the Exchange.\5\ The Exchange proposes to modify the 
qualifications for certain of the tiers.
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    \4\ See Fee Schedule, Section I.E., available here, https://www.nyse.com/publicdocs/nyse/markets/american-options/NYSE_American_Options_Fee_Schedule.pdf. See also Fee Schedule, Key 
Terms and Definitions (defining TCADV as ``Total Industry Customer 
equity and ETF option average daily volume. TCADV includes OCC 
calculated Customer volume of all types, including Complex Order 
transactions and QCC transactions, in equity and ETF options'').
    \5\ The volume thresholds are based on an OFP's Customer volume 
transacted Electronically as a percentage of total industry Customer 
equity and ETF options volumes as reported by the Options Clearing 
Corporation (the ``OCC''). See OCC Monthly Statistics Reports, 
available here, http://www.theocc.com/webapps/monthly-volume-reports.
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    Currently, an OFP that achieves 0.75% or less of Customer 
Electronic ADV (``CADV'') as a percent of TCADV falls within the Base 
Tier and is not eligible to receive ACE Credits. To qualify for Tier 1 
or 2, an OFP may achieve a level of CADV that is equal to or greater 
than certain percentages of the OFP's October 2015 volume 
(collectively, the ``Step Up'' qualifications):
     For Tier 1, an OFP qualifies by achieving CADV that 
exceeds October 2015 volume by at least 0.20% to be eligible for a 
$0.14 per contract credit;
     For Tier 2, the OFP may qualify by achieving CADV that 
exceeds October 2015 volume by at least 0.35% to be eligible for a 
$0.18 per contract credit.\6\ An OFP that achieves Tier 2 is also 
eligible to receive a more favorable $0.19 per contract credit on 
Electronic Customer Complex Orders.\7\
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    \6\ As an alternative to the Step Up qualification basis, an OFP 
may qualify for Tier 2 (and receive the same $0.18 per contract 
credit) by achieving greater than 0.75 CADV.
    \7\ See Fee Schedule, Section I.E., n. 1 (providing that the 
credit for Customer Complex Orders is provided regardless of whether 
the Complex Order trades against interest in the Complex Order Book 
or with individual orders and quotes in the Consolidated Book).
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    The Exchange proposes to eliminate Step Up qualifications and to 
instead provide that OFPs may qualify for ACE credits based solely on 
percentages of monthly TCADV. The Exchange believes this proposed 
change would provide the opportunity to all Exchange participants to 
meet the same reasonable, yet meaningful standard to qualify for the 
ACE Program credits. Thus, as proposed, an OFP that achieves monthly 
CADV of at least 0.40% would qualify for Tier 1; and an OFP that 
achieves monthly CADV of greater than 0.75% would qualify for Tier 
2.\8\ Consistent with the change, the Exchange proposes to modify the 
Fee Schedule to reflect that an OFP that achieves monthly CADV of less 
than 0.40% falls within the Base Tier and, as is the case today, would 
therefore be ineligible for ACE credits.\9\
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    \8\ See proposed Fee Schedule, Section I.E.
    \9\ The Enhanced Credits are only available to those OFPs who 
have an Affiliated NYSE American Options Market Making firm or an 
Appointed MM that has committed to the 1 Year Prepayment Program, 
Balance of the Year Program, or the 3 Year Prepayment Program, 
respectively, as described in Section I.D. See Fee Schedule, Section 
I.E.

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[[Page 43434]]

    The Exchange also proposes to modify the credits for various Tiers 
and to set forth separate credits based on transaction type. Currently, 
the ACE program provides various credits, applied on a per contract 
basis, on all Customer Electronic executions in Standard Options; the 
ACE program also offers more favorable credit for electronic Customer 
Complex Orders to OFPs that achieve Tiers 2, 4 or 5.\10\ An OFP may be 
eligible for enhanced ACE credits based on the Exchange's Prepayment 
Programs (the ``Enhanced Credits'').\11\ The Exchange proposes to 
modify the ACE Program to reflect differing credits based on the 
execution of Simple Orders--sometimes referred to by the Exchange as 
single-leg orders--and to establish ACE credits at each of the five 
tiers for execution of Complex Orders. In this regard, the Exchange 
proposes to define a ``Simple Order,'' as ``any order to purchase or 
sell contracts in a single listed option series'' and to make clear 
that ``[a] Simple Order is sometimes referred to in NYSE American Rules 
as a single-leg order (e.g., Rules 928NY and 980NY).'' \12\
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    \10\ See supra note 7 (regarding more favorable $0.19 credit 
available for OFPs that achieve Tier 2); see also Fee Schedule, 
Section I.E., n. 2 (regarding more favorable $0.25 per contract 
credit available for OFPs that achieve Tier 4 or 5, provided the OFP 
executes more than 0.50% of TCADV in Initiating CUBE Orders in a 
calendar month).
    \11\ See supra note 9.
    \12\ See proposed Fee Schedule, Key Terms and Definitions.
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    As proposed, an OFP that qualifies for Tier 1 would receive a 
credit of $0.12 per contract on executions of Customer Simple Orders, 
or, if eligible, an Enhanced Credit of $0.13 per contract. An OFP that 
qualifies for Tier 1 would receive a credit of $0.19 per contract for 
executions of Complex Orders,\13\ or, if eligible, an Enhanced Credit 
of $0.20 or $0.21 per contract, respectively, depending on whether the 
OFP is a participant in the 1- or 3-Year Prepayment Program.
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    \13\ As noted herein (see supra note 7), under Tier 2, the 
Exchange currently offers a credit of $0.19 per contract for 
executions of Customer Complex Orders.
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    As proposed, an OFP that qualifies for Tier 2 would receive a 
credit of $0.14 per contract on executions of Customer Simple Orders, 
or, if eligible, an Enhanced Credit of $0.15 or $0.16 per contract, 
respectively, depending on whether a participant in the 1- or 3-Year 
Prepayment Program. The Exchange proposes to offer an OFP that 
qualifies for Tier 2 the same credits for executions of Complex Orders 
as is offered to OFPs that achieve Tier 1 (i.e., $0.19 per contract or, 
if eligible, an Enhanced Credit of $0.20 or $0.21 per contract, 
respectively, depending on whether the OFP is a participant in the 1- 
or 3-Year Prepayment Program).
    For clarity purposes, the Exchange is proposing to specify ACE 
credits for Complex Order executions available to an OFP that achieve 
Tiers 3, 4, or 5, which credits are equivalent to ACE credits currently 
available to an OFP that achieve these Tiers.
    Consistent with the foregoing proposal to differentiate ACE credits 
for executions in Simple Orders and Complex Orders, the Exchange 
proposes to modify notes 1 and 2 to Section I.E. (referred to simply as 
``note 1'' and ``note 2''). Regarding note 1, the Exchange proposes to 
remove language made superfluous by these changes (i.e., to delete 
reference to the $0.19 credit for certain Complex Orders) and to make 
clear that ``[t]he credit for Customer Complex Order executions will be 
provided regardless of whether the Complex Order trades against 
interest in the Complex Order Book or with individual orders and quotes 
in the Consolidated Book.'' \14\ In addition, the Exchange proposes to 
delete the reference to note 1 that appears solely in Tier 2 and to 
instead add reference to note 1 in each column of the table setting 
forth the proposed ACE credit for ``Complex'' executions.\15\ To 
further streamline the Fee Schedule, the Exchange proposes to merge 
information from note 2 into proposed note 1 (resulting in the deletion 
of note 2).\16\
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    \14\ See proposed Fee Schedule, Section I.E., n. 1.
    \15\ See proposed Fee Schedule, Section I.E.
    \16\ See proposed Fee Schedule, Section I.E., n. 1 (making clear 
that the potential $0.25 credit available to OFPs that achieve Tiers 
4 or 5 (described supra at note 10) is an alternative more favorable 
credit to the proposed (base) credits for such OFPs, which range 
from $0.19-$0.24). OFPs that are eligible for more than one credit 
will always receive the more favorable credit.
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    The Exchange is also proposing a modification to the calculation of 
an OFP's Electronic volume. The Exchange would no longer provide 
overweighting in the calculation for Customer orders that take 
liquidity. The Exchange believes that eliminating the overweighting of 
such orders, coupled with the proposed modifications to the ACE credits 
offered, should incent OFPs to send a variety of different orders to 
NYSE American Options, including Complex Orders to rest in the Complex 
Order Book.
    The proposed modifications to the ACE Program are designed to 
further encourage market participants to direct order flow to the 
Exchange in an effort to achieve the modified (more achievable) 
qualification thresholds as well as to encourage OFPs to direct Complex 
Order flow to the Exchange in an effort to qualify for the proposed 
(more favorable) rebates. To the extent this purposes [sic] is 
achieved, all Exchange participants would benefit from any additional 
volume and liquidity through increased opportunities to trade as well 
as enhancing price discovery.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\17\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\18\ in particular, 
because it provides for the equitable allocation of reasonable dues, 
fees, and other charges among its members, issuers and other persons 
using its facilities and does not unfairly discriminate between 
customers, issuers, brokers or dealers.
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    \17\ 15 U.S.C. 78f(b).
    \18\ 15 U.S.C. 78f(b)(4) and (5).
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    The Exchange believes that the proposed amendments to the ACE 
Program are reasonable, equitable and not unfairly discriminatory 
because they would enhance the incentives to OFPs to transact Customer 
orders on the Exchange, which would benefit all market participants by 
providing more trading opportunities and tighter spreads, even to those 
market participants that do not participate in the ACE Program. 
Additionally, the Exchange believes the proposed changes to the ACE 
Program are consistent with the Act because they may attract greater 
volume and liquidity to the Exchange, which would benefit all market 
participants by providing tighter quoting and better prices, all of 
which perfects the mechanism for a free and open market and national 
market system.
    Specifically, the Exchange believes that the proposal to eliminate 
Step Up qualifications (for Tiers 1 and 2) would provide the 
opportunity to all Exchange participants to meet the same reasonable, 
yet meaningful standard to qualify for the ACE Program credits. The 
Exchange believes that the proposed modified qualification thresholds 
to achieve Tier 1 or 2 are reasonably offset by the slightly reduced 
credits for an OFP's Simple Order executions. The Exchange believes 
Tiers 1 and 2, as modified, would encourage market participants to 
direct order flow (especially Simple Orders) to the Exchange in an 
effort to achieve the

[[Page 43435]]

modified (more achievable) qualification thresholds. Further, the 
proposal to set forth ACE credits for Complex Orders would encourage 
OFPs that transact Customer Complex Orders to direct this order flow to 
the Exchange in an effort to qualify for the proposed (more favorable) 
rebates. The Exchange believes that all Exchange participants would 
benefit from the any [sic] additional volume and liquidity (resulting 
from the proposed changes) through increased opportunities to trade as 
well as enhancing price discovery. To the extent this goal is achieved, 
the Exchange would improve its overall competitiveness and strengthen 
its market quality for all market participants. The Exchange notes that 
other exchanges similarly offer credits for executions of Complex 
Orders and such credits are therefore not new or novel.\19\
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    \19\ See MIAX Options fee schedule, Section 1.a.ii. (Priority 
Customer Rebate Program), available here, https://www.miaxoptions.com/sites/default/files/fee_schedule-files/MIAX_Options_Fee_Schedule_08072017.pdf (offering per contracts 
credits ranging from $0.21-$0.25 for complex orders). See also The 
Chicago Board Options Exchange, Inc. (``CBOE'') fee schedule, Volume 
Incentive Program, at p. 3, available here, http://www.cboe.com/publish/feeschedule/CBOEFeeSchedule.pdf (offering per contracts 
credits ranging from $0.20-$0.25 for complex orders).
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    The proposal to define ``Simple Orders,'' in the Fee Schedule is 
likewise reasonable, equitable and not unfairly discriminatory because 
it would add clarity and transparency to the Fee Schedule to the 
benefit of all market participants.
    The Exchange believes that the proposal to eliminate the 
overweighting in the calculation for Customer orders that take 
liquidity is likewise reasonable, equitable and not unfairly 
discriminatory because eliminating the overweighting of such orders, 
coupled with the proposed modifications to the ACE credits offered, 
should incent OFPs to send a variety of different orders to NYSE 
American Options, including Complex Orders to rest in the Complex Order 
Book.
    For these reasons, the Exchange believes that the proposal is 
consistent with the Act.

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

    In accordance with Section 6(b)(8) of the Act,\20\ the Exchange 
does not believe that the proposed rule change would impose any burden 
on competition that is not necessary or appropriate in furtherance of 
the purposes of the Act. The Exchange believes the proposed amendments 
to the ACE Program are pro-competitive as the changes should encourage 
OFPs to direct Customer order flow--including Complex Orders--to the 
Exchange and any resulting increase in volume and liquidity to the 
Exchange would benefit all Exchange participants through increased 
opportunities to trade as well as enhancing price discovery. To the 
extent that this purpose is achieved, this proposal would enhance the 
quality of the Exchange's markets and increase the volume of contracts 
traded here. In turn, all the Exchange's market participants would 
benefit from the improved market liquidity. If the proposed changes 
make the Exchange a more attractive marketplace for market participants 
at other exchanges, such market participants are welcome to become ATP 
Holders. The Exchange notes that other exchanges similarly offer 
credits for executions of Complex Orders and such credits are not new 
or novel and would allow the Exchange to better compete with other 
options exchanges.\21\
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    \20\ 15 U.S.C. 78f(b)(8).
    \21\ See supra note 19.
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    The Exchange notes that it operates in a highly competitive market 
in which market participants can readily favor competing venues. In 
such an environment, the Exchange must continually review, and consider 
adjusting, its fees and credits to remain competitive with other 
exchanges. For the reasons described above, the Exchange believes that 
the proposed rule change reflects this competitive environment.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \22\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \23\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
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    \22\ 15 U.S.C. 78s(b)(3)(A).
    \23\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \24\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \24\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEAMER-2017-13 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-NYSEAMER-2017-13. 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

[[Page 43436]]

available publicly. All submissions should refer to File Number SR-
NYSEAMER-2017-13, and should be submitted on or before October 6, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\25\
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    \25\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-19584 Filed 9-14-17; 8:45 am]
 BILLING CODE 8011-01-P
Federal Register / Vol. 82, No. 178 / Friday, September 15, 2017 / Notices 43433

proceedings to determine whether the I. Self-Regulatory Organization’s OFP, as agent, submits to the Exchange.5
proposed rule change should be Statement of the Terms of Substance of The Exchange proposes to modify the
disapproved. The 45th day for this filing the Proposed Rule Change qualifications for certain of the tiers.
is September 15, 2017. Currently, an OFP that achieves
The Exchange proposes to modify the 0.75% or less of Customer Electronic
The Commission is extending the 45- NYSE American Options Fee Schedule ADV (‘‘CADV’’) as a percent of TCADV
day time period for Commission action (‘‘Fee Schedule’’). The Exchange falls within the Base Tier and is not
on the proposed rule change. The proposes to implement the fee change eligible to receive ACE Credits. To
Commission finds that it is appropriate effective September 1, 2017. The qualify for Tier 1 or 2, an OFP may
to designate a longer period within proposed change is available on the achieve a level of CADV that is equal to
which to take action on the proposed Exchange’s Web site at www.nyse.com, or greater than certain percentages of the
rule change so that it has sufficient time at the principal office of the Exchange, OFP’s October 2015 volume
to consider and take action on the and at the Commission’s Public (collectively, the ‘‘Step Up’’
Exchange’s proposed rule change. Reference Room. qualifications):
Accordingly, the Commission, II. Self-Regulatory Organization’s • For Tier 1, an OFP qualifies by
pursuant to Section 19(b)(2) of the Act,8 Statement of the Purpose of, and achieving CADV that exceeds October
Statutory Basis for, the Proposed Rule 2015 volume by at least 0.20% to be
designates October 30, 2017, as the date
Change eligible for a $0.14 per contract credit;
by which the Commission should either • For Tier 2, the OFP may qualify by
approve or disapprove, or institute In its filing with the Commission, the achieving CADV that exceeds October
proceedings to determine whether to self-regulatory organization included 2015 volume by at least 0.35% to be
disapprove, the proposed rule change statements concerning the purpose of, eligible for a $0.18 per contract credit.6
(File Number SR–Phlx–2017–34). and basis for, the proposed rule change An OFP that achieves Tier 2 is also
For the Commission, by the Division of and discussed any comments it received eligible to receive a more favorable
Trading and Markets, pursuant to delegated on the proposed rule change. The text $0.19 per contract credit on Electronic
authority.9 of those statements may be examined at Customer Complex Orders.7
the places specified in Item IV below. The Exchange proposes to eliminate
Eduardo A. Aleman,
The Exchange has prepared summaries, Step Up qualifications and to instead
Assistant Secretary. set forth in sections A, B, and C below, provide that OFPs may qualify for ACE
[FR Doc. 2017–19581 Filed 9–14–17; 8:45 am] of the most significant parts of such credits based solely on percentages of
BILLING CODE 8011–01–P statements. monthly TCADV. The Exchange
A. Self-Regulatory Organization’s believes this proposed change would
Statement of the Purpose of, and the provide the opportunity to all Exchange
SECURITIES AND EXCHANGE participants to meet the same
COMMISSION Statutory Basis for, the Proposed Rule
Change reasonable, yet meaningful standard to
qualify for the ACE Program credits.
[Release No. 34–81569; File No. SR– 1. Purpose Thus, as proposed, an OFP that achieves
NYSEAMER–2017–13] The purpose of this filing is to modify monthly CADV of at least 0.40% would
the Fee Schedule, effective September 1, qualify for Tier 1; and an OFP that
Self-Regulatory Organizations; NYSE achieves monthly CADV of greater than
2017. Specifically, the Exchange
American LLC; Notice of Filing and proposes to amend the American 0.75% would qualify for Tier 2.8
Immediate Effectiveness of a Proposed Customer Engagement (‘‘ACE’’) Program Consistent with the change, the
Rule Change To Modify the NYSE to modify various credits offered and to Exchange proposes to modify the Fee
American Options Fee Schedule establish certain credits provided Schedule to reflect that an OFP that
depending on the type of Electronic achieves monthly CADV of less than
September 11, 2017. 0.40% falls within the Base Tier and, as
transactions (e.g., whether it is a simple
Pursuant to Section 19(b)(1) 1 of the or complex execution). The Exchange is the case today, would therefore be
Securities Exchange Act of 1934 (the also proposes to add ‘‘Simple Order’’ to ineligible for ACE credits.9
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 the glossary of defined terms in the Fee 5 The volume thresholds are based on an OFP’s
notice is hereby given that, on Schedule. Customer volume transacted Electronically as a
September 1, 2017, NYSE American Section I.E. of the Fee Schedule percentage of total industry Customer equity and
LLC (the ‘‘Exchange’’ or ‘‘NYSE describes the Exchange’s ACE Program. ETF options volumes as reported by the Options
American’’) filed with the Securities The ACE Program features a base tier Clearing Corporation (the ‘‘OCC’’). See OCC
Monthly Statistics Reports, available here, http://
and Exchange Commission (the and five higher tiers expressed as a www.theocc.com/webapps/monthly-volume-reports.
‘‘Commission’’) the proposed rule percentage of TCADV 4 and provides 6 As an alternative to the Step Up qualification

change as described in Items I, II, and two alternative methods by which Order basis, an OFP may qualify for Tier 2 (and receive
Flow Providers (each an ‘‘OFP’’) may the same $0.18 per contract credit) by achieving
III below, which Items have been greater than 0.75 CADV.
prepared by the self-regulatory receive per contract credits for 7 See Fee Schedule, Section I.E., n. 1 (providing

organization. The Commission is Electronic Customer volume that the that the credit for Customer Complex Orders is
publishing this notice to solicit provided regardless of whether the Complex Order
4 See Fee Schedule, Section I.E., available here, trades against interest in the Complex Order Book
comments on the proposed rule change
mstockstill on DSK30JT082PROD with NOTICES

https://www.nyse.com/publicdocs/nyse/markets/ or with individual orders and quotes in the
from interested persons. american-options/NYSE_American_Options_Fee_ Consolidated Book).
8 See proposed Fee Schedule, Section I.E.
Schedule.pdf. See also Fee Schedule, Key Terms
8 Id. and Definitions (defining TCADV as ‘‘Total Industry 9 The Enhanced Credits are only available to

9 17 CFR 200.30–3(a)(31). Customer equity and ETF option average daily those OFPs who have an Affiliated NYSE American
1 15
volume. TCADV includes OCC calculated Customer Options Market Making firm or an Appointed MM
U.S.C. 78s(b)(1). volume of all types, including Complex Order that has committed to the 1 Year Prepayment
2 15 U.S.C. 78a.
transactions and QCC transactions, in equity and Program, Balance of the Year Program, or the 3 Year
3 17 CFR 240.19b–4. ETF options’’). Continued

VerDate Sep<11>2014 17:07 Sep 14, 2017 Jkt 241001 PO 00000 Frm 00109 Fmt 4703 Sfmt 4703 E:\FR\FM\15SEN1.SGM 15SEN1
Federal Register / Vol. 82, No. 178 / Friday, September 15, 2017 / Notices 43435

modified (more achievable) pro-competitive as the changes should investors, or otherwise in furtherance of
qualification thresholds. Further, the encourage OFPs to direct Customer the purposes of the Act. If the
proposal to set forth ACE credits for order flow—including Complex Commission takes such action, the
Complex Orders would encourage OFPs Orders—to the Exchange and any Commission shall institute proceedings
that transact Customer Complex Orders resulting increase in volume and under Section 19(b)(2)(B) 24 of the Act to
to direct this order flow to the Exchange liquidity to the Exchange would benefit determine whether the proposed rule
in an effort to qualify for the proposed all Exchange participants through change should be approved or
(more favorable) rebates. The Exchange increased opportunities to trade as well disapproved.
believes that all Exchange participants as enhancing price discovery. To the IV. Solicitation of Comments
would benefit from the any [sic] extent that this purpose is achieved, this
additional volume and liquidity proposal would enhance the quality of Interested persons are invited to
(resulting from the proposed changes) the Exchange’s markets and increase the submit written data, views, and
through increased opportunities to trade volume of contracts traded here. In turn, arguments concerning the foregoing,
as well as enhancing price discovery. To all the Exchange’s market participants including whether the proposed rule
the extent this goal is achieved, the would benefit from the improved change is consistent with the Act.
Exchange would improve its overall market liquidity. If the proposed Comments may be submitted by any of
competitiveness and strengthen its changes make the Exchange a more the following methods:
market quality for all market attractive marketplace for market Electronic Comments
participants. The Exchange notes that participants at other exchanges, such
• Use the Commission’s Internet
other exchanges similarly offer credits market participants are welcome to
comment form (http://www.sec.gov/
for executions of Complex Orders and become ATP Holders. The Exchange
rules/sro.shtml); or
such credits are therefore not new or notes that other exchanges similarly • Send an email to rule-comments@
novel.19 offer credits for executions of Complex sec.gov. Please include File Number SR–
The proposal to define ‘‘Simple Orders and such credits are not new or NYSEAMER–2017–13 on the subject
Orders,’’ in the Fee Schedule is likewise novel and would allow the Exchange to line.
reasonable, equitable and not unfairly better compete with other options
discriminatory because it would add exchanges.21 Paper Comments
clarity and transparency to the Fee The Exchange notes that it operates in • Send paper comments in triplicate
Schedule to the benefit of all market a highly competitive market in which to Secretary, Securities and Exchange
participants. market participants can readily favor Commission, 100 F Street NE.,
The Exchange believes that the competing venues. In such an Washington, DC 20549–1090.
proposal to eliminate the overweighting environment, the Exchange must All submissions should refer to File
in the calculation for Customer orders continually review, and consider Number SR–NYSEAMER–2017–13. This
that take liquidity is likewise adjusting, its fees and credits to remain file number should be included on the
reasonable, equitable and not unfairly competitive with other exchanges. For subject line if email is used. To help the
discriminatory because eliminating the the reasons described above, the Commission process and review your
overweighting of such orders, coupled Exchange believes that the proposed comments more efficiently, please use
with the proposed modifications to the rule change reflects this competitive only one method. The Commission will
ACE credits offered, should incent OFPs environment. post all comments on the Commission’s
to send a variety of different orders to Internet Web site (http://www.sec.gov/
NYSE American Options, including C. Self-Regulatory Organization’s
Statement on Comments on the rules/sro.shtml). Copies of the
Complex Orders to rest in the Complex submission, all subsequent
Order Book. Proposed Rule Change Received From
Members, Participants, or Others amendments, all written statements
For these reasons, the Exchange
with respect to the proposed rule
believes that the proposal is consistent No written comments were solicited
change that are filed with the
with the Act. or received with respect to the proposed
Commission, and all written
rule change.
B. Self-Regulatory Organization’s communications relating to the
Statement on Burden on Competition III. Date of Effectiveness of the proposed rule change between the
In accordance with Section 6(b)(8) of Proposed Rule Change and Timing for Commission and any person, other than
the Act,20 the Exchange does not believe Commission Action those that may be withheld from the
that the proposed rule change would The foregoing rule change is effective public in accordance with the
impose any burden on competition that upon filing pursuant to Section provisions of 5 U.S.C. 552, will be
is not necessary or appropriate in 19(b)(3)(A) 22 of the Act and available for Web site viewing and
furtherance of the purposes of the Act. subparagraph (f)(2) of Rule 19b–4 23 printing in the Commission’s Public
The Exchange believes the proposed thereunder, because it establishes a due, Reference Room, 100 F Street NE.,
amendments to the ACE Program are fee, or other charge imposed by the Washington, DC 20549, on official
Exchange. business days between the hours of
19 See MIAX Options fee schedule, Section 1.a.ii. At any time within 60 days of the 10:00 a.m. and 3:00 p.m. Copies of the
(Priority Customer Rebate Program), available here, filing of such proposed rule change, the filing also will be available for
https://www.miaxoptions.com/sites/default/files/ inspection and copying at the principal
fee_schedule-files/MIAX_Options_Fee_Schedule_
Commission summarily may
office of the Exchange. All comments
mstockstill on DSK30JT082PROD with NOTICES

08072017.pdf (offering per contracts credits ranging temporarily suspend such rule change if
from $0.21–$0.25 for complex orders). See also The it appears to the Commission that such received will be posted without change;
Chicago Board Options Exchange, Inc. (‘‘CBOE’’) fee action is necessary or appropriate in the the Commission does not edit personal
schedule, Volume Incentive Program, at p. 3, identifying information from
available here, http://www.cboe.com/publish/
public interest, for the protection of
feeschedule/CBOEFeeSchedule.pdf (offering per
submissions. You should submit only
contracts credits ranging from $0.20–$0.25 for 21 See supra note 19. information that you wish to make
complex orders). 22 15 U.S.C. 78s(b)(3)(A).
20 15 U.S.C. 78f(b)(8). 23 17 CFR 240.19b–4(f)(2). 24 15 U.S.C. 78s(b)(2)(B).

VerDate Sep<11>2014 17:07 Sep 14, 2017 Jkt 241001 PO 00000 Frm 00111 Fmt 4703 Sfmt 4703 E:\FR\FM\15SEN1.SGM 15SEN1
Document Created: 2017-09-15 00:18:06
Document Modified: 2017-09-15 00:18:06
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 43433