82_FR_5630 82 FR 5619 - Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Modify Fees for Connectivity and Its Communication and Routing Service Known as Bats Connect

82 FR 5619 - Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Modify Fees for Connectivity and Its Communication and Routing Service Known as Bats Connect

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 11 (January 18, 2017)

Page Range5619-5622
FR Document2017-00964

Federal Register, Volume 82 Issue 11 (Wednesday, January 18, 2017)
[Federal Register Volume 82, Number 11 (Wednesday, January 18, 2017)]
[Notices]
[Pages 5619-5622]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-00964]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-79773; File No. SR-BatsEDGA-2017-01]


Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change To 
Modify Fees for Connectivity and Its Communication and Routing Service 
Known as Bats Connect

January 11, 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 January 5, 2017, Bats EDGA Exchange, Inc. (``Exchange'' or ``EDGA'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I, II, and III below, which 
Items have been prepared by the Exchange. The Exchange has designated 
the proposed rule change as one establishing or changing a member due, 
fee, or other charge imposed by the Exchange under Section 
19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\ 
which renders the proposed rule change effective upon filing with the 
Commission. 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\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend the fee schedule applicable 
to Members \5\ and non-members of the Exchange pursuant to EDGA Rules 
15.1(a) and (c) to modify its fees for physical ports, logical ports, 
and for the use of a communication and routing service known as Bats 
Connect.
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    \5\ The term ``Member'' is defined as ``any registered broker or 
dealer that has been admitted to membership in the Exchange.'' See 
Exchange Rule 1.5(n).
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    The text of the proposed rule change is available at the Exchange's 
Web site at www.bats.com, at the principal office of the Exchange, and 
at the Commission's Public Reference Room.

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

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

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

1. Purpose
    The Exchange proposes to modify its fees for physical ports, 
logical ports, and for the use of a communication and routing service 
known as Bats Connect. Each of these proposed changes are described 
below.
Physical Ports
    A physical port is utilized by a Member or non-Member to connect to 
the Exchange at the data centers where the Exchange's servers are 
located. The Exchange currently maintains a presence in two third-party 
data centers: (i) the primary data center where the Exchange's business 
is primarily conducted on a daily basis, and (ii) a secondary data 
center, which is predominantly maintained for business continuity 
purposes. The Exchange currently assesses the following physical 
connectivity fees for Members and non-Members on a monthly basis: 
$2,000 per physical port that connects to the System \6\ via 1 gigabyte 
circuit; and $4,000 per physical port that connects to the System via 
10 gigabyte circuit. The Exchange proposes to increase the fee per 
physical port that connects to the System via a 10 gigabyte circuit 
from $4,000 per month to $6,000 per month in order to cover its 
increased infrastructure costs associated with establishing physical 
ports to connect to the Exchange's Systems and enable it to continue to 
maintain and improve its market technology and services. The Exchange 
does not propose to amend the fee for a 1 gigabyte circuit, which will 
remain $2,000 per month.
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    \6\ The term ``System'' is defined as ``the electronic 
communications and trading facility designated by the Board through 
which securities orders of Users are consolidated for ranking, 
execution and, when applicable, routing away.'' See Exchange Rule 
1.5(cc).
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Logical Ports
    The Exchange currently charges for logical ports (including 
Multicast PITCH Spin Server and GRP ports) $500 per port per month. A 
logical port

[[Page 5620]]

represents a port established by the Exchange within the Exchange's 
system for trading and billing purposes. Each logical port established 
is specific to a Member or non-Member and grants that Member or non-
Member the ability to operate a specific application, such as FIX order 
entry or PITCH data receipt. Logical port fees are limited to logical 
ports in the Exchange's primary data center and no logical port fees 
are assessed for redundant secondary data center ports. The Exchange 
assesses the monthly per logical port fees to all Members' and non-
Members' logical ports. The Exchange now proposes to increase charges 
for logical ports (including Multicast PITCH Spin Server and GRP ports) 
from $500 per port per month to $550 per month. Like as for the 
proposed fee increase for physical ports described above, the proposed 
increase in logical port fees is intended to cover increased 
infrastructure costs associated with establishing ports to connect to 
the Exchange's Systems and to enable the Exchange to continue to 
maintain and improve its market technology and services.
Bats Connect
    The Exchange proposes to increase select fees related to the use of 
Bats Connect. Bats Connect is offered by the Exchange on a voluntary 
basis in a capacity similar to a vendor.\7\ In sum, Bats Connect is a 
communication service that provides subscribers an additional means to 
receive market data from and route orders to any destination connected 
to the Exchange's network. Bats Connect does not provide any advantage 
to subscribers for connecting to the Exchange's affiliates \8\ as 
compared to other methods of connectivity. The servers of the 
subscriber need not be located in the same facilities as the Exchange 
in order to subscribe to Bats Connect. Subscribers may also seek to 
utilize Bats Connect in the event of a market disruption where other 
alternative connection methods become unavailable.
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    \7\ See Exchange Rule 13.9.
    \8\ The Exchange's affiliated exchanges are Bats EDGX Exchange, 
Inc. (``EDGX''), Bats BYX Exchange, Inc. (``BYX''), and Bats BZX 
Exchange, Inc. (``BZX'').
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    The Exchange charges a monthly connectivity fee to subscribers 
utilizing Bats Connect to route orders to other exchanges and broker-
dealers that are connected to the Exchange's network via unicast 
access. The amount of the connectivity fee varies based solely on the 
bandwidth selected by the subscriber. Specifically, as set forth under 
the Unicast Access--Order Entry section of the fee schedule, the 
Exchange charges $350 for 1 Mb, $700 for 5 Mb, $950 for 10 Mb, $1,500 
for 25 Mb, $2,500 for 50 Mb, and $3,500 for 100 Mb. The Exchange 
proposes to increase those fees as follows: $500 for 1 Mb, $1,000 for 5 
Mb, and $1,250 for 10 Mb. The proposed increases are designed to cover 
increased costs related to hardware, installation, and testing, as well 
as increased expenses involved in maintaining and managing the service. 
The Exchange does not propose to increase the fees for the 25 Mb, 50 Mb 
and 100 Mb connections as those fees will remain $1,500, $2,500, and 
$3,500, respectively.
    Bats Connect also allows subscribers to receive market data feeds 
from the exchanges connected to the Exchange's network. In such case, 
the subscriber pays the Exchange a connectivity fee, which are set 
forth under the Market Data Connectivity section of the fee schedule 
and vary based solely on the amount of bandwidth required to transmit 
the selected data product to the subscriber.\9\ The proposed 
connectivity fees currently range from no charge to $11,500 based on 
the market data product the subscriber selects. The Exchange proposes 
to increase select connectivity fees for market data as follows:
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    \9\ Subscribers pays any fees charged by the exchange providing 
the market data feed directly to that exchange.

------------------------------------------------------------------------
                Data feed                   Current fee    Proposed fee
------------------------------------------------------------------------
UQDF/UTDF/OMDF..........................            $650          $1,200
CQS/CTS.................................           1,000           1,400
OPRA....................................           3,500           4,500
Nasdaq TotalView........................           1,300           1,500
Nasdaq BX TotalView.....................             650           1,000
Nasdaq PSX TotalView....................             350             750
NYSE Integrated.........................          11,500          14,500
NYSE ArcaBook...........................           1,000           1,250
NYSE MKT OpenBook Ultra.................             150             500
NYSE Alerts.............................             250             500
NYSE Imbalances.........................             100             500
NYSE Arca Trades........................             250             500
BBDS/TDDS...............................             100             500
------------------------------------------------------------------------

    The proposed increases are designed to allow the Exchange to cover 
the increased costs related to the amount of bandwidth required to 
provide connectivity to receive market data as well as the costs of 
maintaining that infrastructure.
    The Exchange also charges a discounted fee of $4,160 per month for 
subscribers who purchase connectivity to a bundle of select market data 
products, known as the U.S. Equities Select + SIP Bundle. The following 
market data products are included in the bundle: UQDF/UTDF/OMDF, CQS/
CTS, Nasdaq TotalView, Nasdaq BX TotalView, Nasdaq PSX TotalView, NYSE 
ArcaBook, NYSE MKT OpenBook Ultra, and BBDS/TDDS.\10\ Absent the 
discount, a subscriber purchasing connectivity through Bats Connect for 
each of these market data products would currently pay a total monthly 
fee of $5,200. Instead, a subscriber who purchases connectivity to each 
of the above market data products is charged a monthly fee of $4,160, 
which represents a 20% discount. The Exchange proposes to add NYSE 
OpenBook Ultra to the bundle. Also, in light of the proposed changes 
outlined above, the Exchange proposes to increase the discounted rate 
of the bundle to $5,910 per month, which would now represent a 40% 
discount from the rate of $9,850 a subscriber purchasing connectivity 
through Bats Connect for each of these market data

[[Page 5621]]

products would be charged under the proposed rule change.
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    \10\ The Exchange also proposes to correct a typographical error 
in referencing BBDS/TDDS in its description of the U.S. Equity 
Select + SIP bundle.
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    Lastly, the Exchange proposes to charge a discounted fee of $6,390 
per month for subscribers who purchase connectivity to the OPRA, UQDF/
UTDF/OMDF, and CQS/CTS data feeds, to be known as the OPRA + SIP 
Bundle. Absent the discount, a subscriber purchasing connectivity 
through Bats Connect for each of these market data products would pay a 
total monthly fee of $7,100. Instead, a subscriber who purchases 
connectivity to each of the above market data products is charged a 
monthly fee of $6,390, which represents a 10% discount.
Implementation Date
    The Exchange proposes to implement this amendment to its fee 
schedule on January 3, 2017.\11\
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    \11\ The Exchange initially filed the proposed rule change on 
December 27, 2016. (SR-BatsEDGA-2016-33). On January 5, 2017, the 
Exchange withdrew SR-BatsEDGA-2016-33 and submitted this filing.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the objectives of Section 6 of the Act,\12\ in general, and 
furthers the objectives of Section 6(b)(4),\13\ in particular, as it is 
designed to provide for the equitable allocation of reasonable dues, 
fees and other charges among its Members and other persons using its 
facilities. The Exchange also notes that it operates in a highly-
competitive market in which market participants can readily direct 
order flow to competing venues if they deem fee levels at a particular 
venue to be excessive. The proposed rule change reflects a competitive 
pricing structure designed to incent market participants to direct 
their order flow to the Exchange. The Exchange believes that the 
proposed rates are equitable and non-discriminatory in that they apply 
uniformly to all Members. The Exchange believes the fees and credits 
remain competitive with those charged by other venues and therefore 
continue to be reasonable and equitably allocated to Members.
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    \12\ 15 U.S.C. 78f.
    \13\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that the proposal represents an equitable 
allocation of reasonable dues, fees, and other charges as its fees for 
physical connectivity are reasonably constrained by competitive 
alternatives. If a particular exchange charges excessive fees for 
connectivity, affected Members and non-Members may opt to terminate 
their connectivity arrangements with that exchange, and adopt a 
possible range of alternative strategies, including routing to the 
applicable exchange through another participant or market center or 
taking that exchange's data indirectly. Accordingly, if the Exchange 
charges excessive fees, it would stand to lose not only connectivity 
revenues but also revenues associated with the execution of orders 
routed to it, and, to the extent applicable, market data revenues. The 
Exchange believes that this competitive dynamic imposes powerful 
restraints on the ability of any exchange to charge unreasonable fees 
for connectivity.
    Furthermore, the proposed rule change is also an equitable 
allocation of reasonable dues, fees, and other charges as the Exchange 
believes that the increased fees obtained will enable it to cover its 
increased infrastructure costs associated with establishing physical 
ports to connect to the Exchange's Systems. The additional revenue from 
the increased fees will also enable the Exchange to continue to 
maintain and improve its market technology and services.
Physical Ports
    The Exchange believes that the proposed fees for a 10 gigabyte 
circuit of $6,000 per month is reasonable in that they are less than 
analogous fees charged by the Nasdaq Stock Market LLC (``Nasdaq'') and 
NYSE Arca, Inc. (``Arca''), which range from $10,000--$15,000 per month 
for 10 gigabyte circuits.\14\ The Exchange believes that the proposed 
rates are equitable and non-discriminatory in that they apply uniformly 
to all Members and non-Members. Members and non-Members will continue 
to choose whether they want more than one physical port and choose the 
method of connectivity based on their specific needs. All Exchange 
Members that voluntarily select various service options will be charged 
the same amount for the same services. As is true of all physical 
connectivity, all Members and non-Members have the option to select any 
connectivity option, and there is no differentiation with regard to the 
fees charged for the service.
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    \14\ See Nasdaq Rule 7034(b) and the NYSE Arca fee schedule 
available at https://www.nyse.com/publicdocs/nyse/markets/nyse-arca/NYSE_Arca_Marketplace_Fees.pdf (dated December 2, 2016).
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Logical Ports
    The Exchange believes that the increase of fees for logical ports 
represents an equitable allocation of reasonable dues, fees and other 
charges. The Exchange believes that its proposed changes to logical 
port fees are reasonable in light of the benefits to Exchange 
participants of direct market access and receipt of data. The Exchange 
believes its proposed fees are reasonable because Nasdaq and NYSE Arca 
charge comparable rates for logical ports to access such markets.\15\
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    \15\ See Nasdaq Rule 7015(b) (charging a fee of $575 per month 
for FIX Trading Ports) and the NYSE Arca fee schedule available at 
https://www.nyse.com/publicdocs/nyse/markets/nyse-arca/NYSE_Arca_Marketplace_Fees.pdf (dated December 2, 2016) (charging a 
fee of $550 per month for ports for order/quote entry).
---------------------------------------------------------------------------

Bats Connect
    The Exchange also believes that its proposed fees for Bats Connect 
provide for the equitable allocation of reasonable dues, fees and other 
charges among members and other persons using its facilities. First, 
the Exchange charges a connectivity fee to subscribers utilizing Bats 
Connect to route orders to other exchanges and market centers that are 
connected to the Exchange's network, which varies based solely on the 
amount of bandwidth selected by the subscriber. The proposed increased 
connectivity fees remain reasonable and competitive as compared to 
similar fees charged by other exchanges. For purposes of order routing, 
the Exchange proposes to now charge $500 for 1 Mb, $1,000 for 5 Mb, and 
$1,250 for 10 Mb. The New York Stock Exchange, Inc. (``NYSE'') 
currently charges $300 for 1 Mb, $700 for 5 Mb, and $900 for 10 Mb.\16\ 
In addition, the proposed rates continue to be less than what a 
subscriber would pay to connect directly to another exchange.\17\ The 
Exchange notes that, overall, the connectivity fee for routing of 
orders to other market centers proposed by the Exchange is similar to 
that charged by the NYSE.
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    \16\ See Section 3.6.1 of NYSE's SFTI Americas Product and 
Service List available at http://www.nyxdata.com/docs/connectivity.
    \17\ See e.g., Nasdaq Rule 7034(b) and the Co-Location section 
of the NYSE Arca fee schedule available at https://www.nyse.com/publicdocs/nyse/markets/nyse-arca/NYSE_Arca_Marketplace_Fees.pdf 
(dated December 2, 2016).
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    Second, with regard to utilizing Bats Connect to receive market 
data products from other exchanges, the Exchange only charges 
subscribers a connectivity fee, the amount of which is based solely on 
the amount of bandwidth required to transmit that specific data product 
to the subscribers. The Exchange believes it is necessary to increase 
the rates for select market data feeds as described herein to address 
changes in bandwidth necessary to receive such feeds. The increased 
fees will also enable the Exchange to continue to cover the increased 
infrastructure costs while also enabling it to continue to maintain and 
improve the service.

[[Page 5622]]

    The amounts of the connectivity fees continue to be reasonable as 
compared to similar fees charged by other exchanges. For example, for 
market data connectivity, Nasdaq charges $1,412 per month for CQS/CTS 
data feed, and the Exchange proposes to charge $1,400 per month 
connectivity for CQS/CTS data feed.\18\
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    \18\ See Nasdaq Rule 7034 (setting forth Nasdaq's connectivity 
fees for receipt of third party market data products).
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    The Exchange believes it is reasonable to offer such discounted 
pricing to subscribers who purchase connectivity to a bundle of market 
data products as it would enable them to reduce their overall 
connectivity costs for the receipt of market data. The Exchange is not 
required by any rule or regulation to make Bats Connect available; nor 
are subscribers required by any rule or regulation to utilize Bats 
Connect. Accordingly, subscribers can discontinue use at any time and 
for any reason, including due to an assessment of the reasonableness of 
fees charged. Moreover, the Exchange believes the proposed fees are 
reasonable and equitable because they continue to be based on the 
Exchange's costs to cover the amount of bandwidth required to provide 
connectivity to the select bundle of data feeds. The proposed fees will 
continue to allow the Exchange to recoup this cost, while providing 
subscribers with an alternative means to connect to the select bundle 
of data feeds at a discounted rate.
    Lastly, the Exchange believes the proposed fees are reasonable and 
equitable because they are based on the Exchange's costs to cover 
hardware, installation, testing and connection, as well as expenses 
involved in maintaining and managing the service. The proposed fees 
allow the Exchange to recoup these costs, while providing subscribers 
with an alternative means to connect to other exchange and market 
centers. The Exchange believes that the proposed fees are reasonable 
and equitable in that they reflect the costs and the benefit of 
providing alternative connectivity.

(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. As discussed above, the 
Exchange believes that fees for connectivity are constrained by the 
robust competition for order flow among exchanges and non-exchange 
markets. The Exchange does not believe that the proposed changes 
represent a significant departure from previous pricing offered by the 
Exchange or pricing offered by the Exchange's competitors. 
Additionally, Members may opt to disfavor the Exchange's pricing if 
they believe that alternatives offer them better value. Further, 
excessive fees for connectivity would serve to impair an exchange's 
ability to compete for order flow rather than burdening competition.
    Lastly, the Exchange does not believe the proposed fees for Bats 
Connect will result in any burden on competition. The proposed rule 
change is designed to provide subscribers with an alternative means to 
access other market centers on the Exchange's network if they choose or 
in the event of a market disruption where other alternative connection 
methods become unavailable. Bats Connect is not the exclusive method to 
connect to these market centers and subscribers may utilize alternative 
methods to connect to the product if they believe the Exchange's 
proposed pricing is unreasonable or otherwise. Therefore, the Exchange 
does not believe the proposed rule change will have any effect on 
competition.

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

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from Members or other interested 
parties.

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) of the Act \19\ and paragraph (f) of Rule 19b-4 
thereunder.\20\ 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 
necessary or appropriate in the public interest, for the protection of 
investors, or otherwise in furtherance of the purposes of the Act.
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    \19\ 15 U.S.C. 78s(b)(3)(A).
    \20\ 17 CFR 240.19b-4(f).
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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 rule-comments@sec.gov. Please include 
File Number SR-BatsEDGA-2017-01 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-BatsEDGA-2017-01. 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-BatsEDGA-2017-01 and should 
be submitted on or before February 8, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\21\
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    \21\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-00964 Filed 1-17-17; 8:45 am]
 BILLING CODE 8011-01-P



                                                                               Federal Register / Vol. 82, No. 11 / Wednesday, January 18, 2017 / Notices                                                        5619

                                                  Electronic Comments                                       SECURITIES AND EXCHANGE                                concerning the purpose of and basis for
                                                                                                            COMMISSION                                             the proposed rule change and discussed
                                                    • Use the Commission’s Internet                                                                                any comments it received on the
                                                  comment form (http://www.sec.gov/                         [Release No. 34–79773; File No. SR–
                                                                                                            BatsEDGA–2017–01]
                                                                                                                                                                   proposed rule change. The text of these
                                                  rules/sro.shtml); or                                                                                             statements may be examined at the
                                                    • Send an email to rule-comments@                       Self-Regulatory Organizations; Bats                    places specified in Item IV below. The
                                                  sec.gov. Please include File Number SR–                   EDGA Exchange, Inc.; Notice of Filing                  Exchange has prepared summaries, set
                                                  BatsEDGX–2017–02 on the subject line.                     and Immediate Effectiveness of a                       forth in Sections A, B, and C below, of
                                                                                                            Proposed Rule Change To Modify Fees                    the most significant parts of such
                                                  Paper Comments                                            for Connectivity and Its                               statements.
                                                    • Send paper comments in triplicate                     Communication and Routing Service                      (A) Self-Regulatory Organization’s
                                                  to Secretary, Securities and Exchange                     Known as Bats Connect                                  Statement of the Purpose of, and
                                                  Commission, 100 F Street NE.,                             January 11, 2017.                                      Statutory Basis for, the Proposed Rule
                                                  Washington, DC 20549–1090.                                   Pursuant to Section 19(b)(1) of the                 Change
                                                  All submissions should refer to File                      Securities Exchange Act of 1934                        1. Purpose
                                                                                                            (‘‘Act’’),1 and Rule 19b–4 thereunder,2                   The Exchange proposes to modify its
                                                  Number SR–BatsEDGX–2017–02. This
                                                                                                            notice is hereby given that on January 5,              fees for physical ports, logical ports, and
                                                  file number should be included on the
                                                                                                            2017, Bats EDGA Exchange, Inc.                         for the use of a communication and
                                                  subject line if email is used. To help the
                                                                                                            (‘‘Exchange’’ or ‘‘EDGA’’) filed with the              routing service known as Bats Connect.
                                                  Commission process and review your                        Securities and Exchange Commission
                                                  comments more efficiently, please use                                                                            Each of these proposed changes are
                                                                                                            (‘‘Commission’’) the proposed rule                     described below.
                                                  only one method. The Commission will                      change as described in Items I, II, and
                                                  post all comments on the Commission’s                     III below, which Items have been                       Physical Ports
                                                  Internet Web site (http://www.sec.gov/                    prepared by the Exchange. The                             A physical port is utilized by a
                                                  rules/sro.shtml). Copies of the                           Exchange has designated the proposed                   Member or non-Member to connect to
                                                  submission, all subsequent                                rule change as one establishing or                     the Exchange at the data centers where
                                                  amendments, all written statements                        changing a member due, fee, or other                   the Exchange’s servers are located. The
                                                  with respect to the proposed rule                         charge imposed by the Exchange under                   Exchange currently maintains a
                                                  change that are filed with the                            Section 19(b)(3)(A)(ii) of the Act 3 and               presence in two third-party data centers:
                                                  Commission, and all written                               Rule 19b–4(f)(2) thereunder,4 which                    (i) the primary data center where the
                                                  communications relating to the                            renders the proposed rule change                       Exchange’s business is primarily
                                                  proposed rule change between the                          effective upon filing with the                         conducted on a daily basis, and (ii) a
                                                  Commission and any person, other than                     Commission. The Commission is                          secondary data center, which is
                                                  those that may be withheld from the                       publishing this notice to solicit                      predominantly maintained for business
                                                  public in accordance with the                             comments on the proposed rule change                   continuity purposes. The Exchange
                                                  provisions of 5 U.S.C. 552, will be                       from interested persons.                               currently assesses the following
                                                  available for Web site viewing and                        I. Self-Regulatory Organization’s                      physical connectivity fees for Members
                                                  printing in the Commission’s Public                       Statement of the Terms of Substance of                 and non-Members on a monthly basis:
                                                  Reference Room, 100 F Street NE.,                         the Proposed Rule Change                               $2,000 per physical port that connects
                                                  Washington, DC 20549, on official                                                                                to the System 6 via 1 gigabyte circuit;
                                                                                                               The Exchange filed a proposal to                    and $4,000 per physical port that
                                                  business days between the hours of                        amend the fee schedule applicable to                   connects to the System via 10 gigabyte
                                                  10:00 a.m. and 3:00 p.m. Copies of the                    Members 5 and non-members of the                       circuit. The Exchange proposes to
                                                  filing also will be available for                         Exchange pursuant to EDGA Rules                        increase the fee per physical port that
                                                  inspection and copying at the principal                   15.1(a) and (c) to modify its fees for                 connects to the System via a 10 gigabyte
                                                  office of the Exchange. All comments                      physical ports, logical ports, and for the             circuit from $4,000 per month to $6,000
                                                  received will be posted without change;                   use of a communication and routing                     per month in order to cover its
                                                  the Commission does not edit personal                     service known as Bats Connect.                         increased infrastructure costs associated
                                                  identifying information from                                 The text of the proposed rule change                with establishing physical ports to
                                                  submissions. You should submit only                       is available at the Exchange’s Web site                connect to the Exchange’s Systems and
                                                  information that you wish to make                         at www.bats.com, at the principal office               enable it to continue to maintain and
                                                  available publicly. All submissions                       of the Exchange, and at the                            improve its market technology and
                                                  should refer to File Number SR–                           Commission’s Public Reference Room.                    services. The Exchange does not
                                                  BatsEDGX–2017–02 and should be                            II. Self-Regulatory Organization’s                     propose to amend the fee for a 1
                                                  submitted on or before February 8, 2017.                  Statement of the Purpose of, and                       gigabyte circuit, which will remain
                                                    For the Commission, by the Division of                  Statutory Basis for, the Proposed Rule                 $2,000 per month.
                                                  Trading and Markets, pursuant to delegated                Change                                                 Logical Ports
                                                  authority.21                                                 In its filing with the Commission, the                The Exchange currently charges for
                                                  Eduardo A. Aleman,                                        Exchange included statements                           logical ports (including Multicast PITCH
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                                                  Assistant Secretary.                                                                                             Spin Server and GRP ports) $500 per
                                                                                                              1 15 U.S.C. 78s(b)(1).
                                                  [FR Doc. 2017–00965 Filed 1–17–17; 8:45 am]                                                                      port per month. A logical port
                                                                                                              2 17 CFR 240.19b–4.
                                                  BILLING CODE 8011–01–P                                      3 15 U.S.C. 78s(b)(3)(A)(ii).
                                                                                                                                                                     6 The term ‘‘System’’ is defined as ‘‘the electronic
                                                                                                              4 17 CFR 240.19b–4(f)(2).
                                                                                                                                                                   communications and trading facility designated by
                                                                                                              5 The term ‘‘Member’’ is defined as ‘‘any
                                                                                                                                                                   the Board through which securities orders of Users
                                                                                                            registered broker or dealer that has been admitted     are consolidated for ranking, execution and, when
                                                                                                            to membership in the Exchange.’’ See Exchange          applicable, routing away.’’ See Exchange Rule
                                                    21 17   CFR 200.30–3(a)(12).                            Rule 1.5(n).                                           1.5(cc).



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                                                  5620                                  Federal Register / Vol. 82, No. 11 / Wednesday, January 18, 2017 / Notices

                                                  represents a port established by the                                        Connect. Bats Connect is offered by the                                      for 5 Mb, $950 for 10 Mb, $1,500 for 25
                                                  Exchange within the Exchange’s system                                       Exchange on a voluntary basis in a                                           Mb, $2,500 for 50 Mb, and $3,500 for
                                                  for trading and billing purposes. Each                                      capacity similar to a vendor.7 In sum,                                       100 Mb. The Exchange proposes to
                                                  logical port established is specific to a                                   Bats Connect is a communication                                              increase those fees as follows: $500 for
                                                  Member or non-Member and grants that                                        service that provides subscribers an                                         1 Mb, $1,000 for 5 Mb, and $1,250 for
                                                  Member or non-Member the ability to                                         additional means to receive market data                                      10 Mb. The proposed increases are
                                                  operate a specific application, such as                                     from and route orders to any destination                                     designed to cover increased costs
                                                  FIX order entry or PITCH data receipt.                                      connected to the Exchange’s network.                                         related to hardware, installation, and
                                                  Logical port fees are limited to logical                                    Bats Connect does not provide any                                            testing, as well as increased expenses
                                                  ports in the Exchange’s primary data                                        advantage to subscribers for connecting                                      involved in maintaining and managing
                                                  center and no logical port fees are                                         to the Exchange’s affiliates 8 as                                            the service. The Exchange does not
                                                  assessed for redundant secondary data                                       compared to other methods of                                                 propose to increase the fees for the 25
                                                  center ports. The Exchange assesses the                                     connectivity. The servers of the                                             Mb, 50 Mb and 100 Mb connections as
                                                  monthly per logical port fees to all                                        subscriber need not be located in the                                        those fees will remain $1,500, $2,500,
                                                  Members’ and non-Members’ logical                                           same facilities as the Exchange in order                                     and $3,500, respectively.
                                                  ports. The Exchange now proposes to                                         to subscribe to Bats Connect.
                                                  increase charges for logical ports                                          Subscribers may also seek to utilize Bats                                       Bats Connect also allows subscribers
                                                  (including Multicast PITCH Spin Server                                      Connect in the event of a market                                             to receive market data feeds from the
                                                  and GRP ports) from $500 per port per                                       disruption where other alternative                                           exchanges connected to the Exchange’s
                                                  month to $550 per month. Like as for                                        connection methods become                                                    network. In such case, the subscriber
                                                  the proposed fee increase for physical                                      unavailable.                                                                 pays the Exchange a connectivity fee,
                                                  ports described above, the proposed                                            The Exchange charges a monthly                                            which are set forth under the Market
                                                  increase in logical port fees is intended                                   connectivity fee to subscribers utilizing                                    Data Connectivity section of the fee
                                                  to cover increased infrastructure costs                                     Bats Connect to route orders to other                                        schedule and vary based solely on the
                                                  associated with establishing ports to                                       exchanges and broker-dealers that are                                        amount of bandwidth required to
                                                  connect to the Exchange’s Systems and                                       connected to the Exchange’s network                                          transmit the selected data product to the
                                                  to enable the Exchange to continue to                                       via unicast access. The amount of the                                        subscriber.9 The proposed connectivity
                                                  maintain and improve its market                                             connectivity fee varies based solely on                                      fees currently range from no charge to
                                                  technology and services.                                                    the bandwidth selected by the                                                $11,500 based on the market data
                                                                                                                              subscriber. Specifically, as set forth                                       product the subscriber selects. The
                                                  Bats Connect                                                                under the Unicast Access—Order Entry                                         Exchange proposes to increase select
                                                    The Exchange proposes to increase                                         section of the fee schedule, the                                             connectivity fees for market data as
                                                  select fees related to the use of Bats                                      Exchange charges $350 for 1 Mb, $700                                         follows:

                                                                                                                                Data feed                                                                                        Current fee    Proposed fee

                                                  UQDF/UTDF/OMDF .................................................................................................................................................                       $650            $1,200
                                                  CQS/CTS .................................................................................................................................................................             1,000             1,400
                                                  OPRA .......................................................................................................................................................................          3,500             4,500
                                                  Nasdaq TotalView ....................................................................................................................................................                 1,300             1,500
                                                  Nasdaq BX TotalView ..............................................................................................................................................                      650             1,000
                                                  Nasdaq PSX TotalView ...........................................................................................................................................                        350               750
                                                  NYSE Integrated ......................................................................................................................................................               11,500            14,500
                                                  NYSE ArcaBook ......................................................................................................................................................                  1,000             1,250
                                                  NYSE MKT OpenBook Ultra ...................................................................................................................................                             150               500
                                                  NYSE Alerts .............................................................................................................................................................               250               500
                                                  NYSE Imbalances ....................................................................................................................................................                    100               500
                                                  NYSE Arca Trades ..................................................................................................................................................                     250               500
                                                  BBDS/TDDS ............................................................................................................................................................                  100               500



                                                    The proposed increases are designed                                       market data products are included in                                         a monthly fee of $4,160, which
                                                  to allow the Exchange to cover the                                          the bundle: UQDF/UTDF/OMDF, CQS/                                             represents a 20% discount. The
                                                  increased costs related to the amount of                                    CTS, Nasdaq TotalView, Nasdaq BX                                             Exchange proposes to add NYSE
                                                  bandwidth required to provide                                               TotalView, Nasdaq PSX TotalView,                                             OpenBook Ultra to the bundle. Also, in
                                                  connectivity to receive market data as                                      NYSE ArcaBook, NYSE MKT OpenBook                                             light of the proposed changes outlined
                                                  well as the costs of maintaining that                                       Ultra, and BBDS/TDDS.10 Absent the                                           above, the Exchange proposes to
                                                  infrastructure.                                                             discount, a subscriber purchasing                                            increase the discounted rate of the
                                                    The Exchange also charges a                                               connectivity through Bats Connect for                                        bundle to $5,910 per month, which
                                                  discounted fee of $4,160 per month for                                      each of these market data products                                           would now represent a 40% discount
                                                  subscribers who purchase connectivity                                       would currently pay a total monthly fee                                      from the rate of $9,850 a subscriber
                                                  to a bundle of select market data                                           of $5,200. Instead, a subscriber who                                         purchasing connectivity through Bats
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                                                  products, known as the U.S. Equities                                        purchases connectivity to each of the                                        Connect for each of these market data
                                                  Select + SIP Bundle. The following                                          above market data products is charged

                                                    7 See  Exchange Rule 13.9.                                                  9 Subscribers pays any fees charged by the                                 its description of the U.S. Equity Select + SIP
                                                    8 The  Exchange’s affiliated exchanges are Bats                           exchange providing the market data feed directly to                          bundle.
                                                  EDGX Exchange, Inc. (‘‘EDGX’’), Bats BYX                                    that exchange.
                                                  Exchange, Inc. (‘‘BYX’’), and Bats BZX Exchange,                              10 The Exchange also proposes to correct a

                                                  Inc. (‘‘BZX’’).                                                             typographical error in referencing BBDS/TDDS in



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                                                                             Federal Register / Vol. 82, No. 11 / Wednesday, January 18, 2017 / Notices                                                       5621

                                                  products would be charged under the                     range of alternative strategies, including             Exchange participants of direct market
                                                  proposed rule change.                                   routing to the applicable exchange                     access and receipt of data. The
                                                    Lastly, the Exchange proposes to                      through another participant or market                  Exchange believes its proposed fees are
                                                  charge a discounted fee of $6,390 per                   center or taking that exchange’s data                  reasonable because Nasdaq and NYSE
                                                  month for subscribers who purchase                      indirectly. Accordingly, if the Exchange               Arca charge comparable rates for logical
                                                  connectivity to the OPRA, UQDF/                         charges excessive fees, it would stand to              ports to access such markets.15
                                                  UTDF/OMDF, and CQS/CTS data feeds,                      lose not only connectivity revenues but
                                                  to be known as the OPRA + SIP Bundle.                                                                          Bats Connect
                                                                                                          also revenues associated with the
                                                  Absent the discount, a subscriber                       execution of orders routed to it, and, to                 The Exchange also believes that its
                                                  purchasing connectivity through Bats                    the extent applicable, market data                     proposed fees for Bats Connect provide
                                                  Connect for each of these market data                   revenues. The Exchange believes that                   for the equitable allocation of reasonable
                                                  products would pay a total monthly fee                  this competitive dynamic imposes                       dues, fees and other charges among
                                                  of $7,100. Instead, a subscriber who                    powerful restraints on the ability of any              members and other persons using its
                                                  purchases connectivity to each of the                   exchange to charge unreasonable fees                   facilities. First, the Exchange charges a
                                                  above market data products is charged                   for connectivity.                                      connectivity fee to subscribers utilizing
                                                  a monthly fee of $6,390, which                            Furthermore, the proposed rule                       Bats Connect to route orders to other
                                                  represents a 10% discount.                              change is also an equitable allocation of              exchanges and market centers that are
                                                                                                          reasonable dues, fees, and other charges               connected to the Exchange’s network,
                                                  Implementation Date                                                                                            which varies based solely on the
                                                                                                          as the Exchange believes that the
                                                    The Exchange proposes to implement                    increased fees obtained will enable it to              amount of bandwidth selected by the
                                                  this amendment to its fee schedule on                   cover its increased infrastructure costs               subscriber. The proposed increased
                                                  January 3, 2017.11                                      associated with establishing physical                  connectivity fees remain reasonable and
                                                  2. Statutory Basis                                      ports to connect to the Exchange’s                     competitive as compared to similar fees
                                                                                                          Systems. The additional revenue from                   charged by other exchanges. For
                                                     The Exchange believes that the                       the increased fees will also enable the                purposes of order routing, the Exchange
                                                  proposed rule change is consistent with                 Exchange to continue to maintain and                   proposes to now charge $500 for 1 Mb,
                                                  the objectives of Section 6 of the Act,12               improve its market technology and                      $1,000 for 5 Mb, and $1,250 for 10 Mb.
                                                  in general, and furthers the objectives of              services.                                              The New York Stock Exchange, Inc.
                                                  Section 6(b)(4),13 in particular, as it is                                                                     (‘‘NYSE’’) currently charges $300 for 1
                                                  designed to provide for the equitable                   Physical Ports                                         Mb, $700 for 5 Mb, and $900 for 10
                                                  allocation of reasonable dues, fees and                    The Exchange believes that the                      Mb.16 In addition, the proposed rates
                                                  other charges among its Members and                     proposed fees for a 10 gigabyte circuit                continue to be less than what a
                                                  other persons using its facilities. The                 of $6,000 per month is reasonable in                   subscriber would pay to connect
                                                  Exchange also notes that it operates in                 that they are less than analogous fees                 directly to another exchange.17 The
                                                  a highly-competitive market in which                    charged by the Nasdaq Stock Market                     Exchange notes that, overall, the
                                                  market participants can readily direct                  LLC (‘‘Nasdaq’’) and NYSE Arca, Inc.                   connectivity fee for routing of orders to
                                                  order flow to competing venues if they                  (‘‘Arca’’), which range from $10,000—                  other market centers proposed by the
                                                  deem fee levels at a particular venue to                $15,000 per month for 10 gigabyte                      Exchange is similar to that charged by
                                                  be excessive. The proposed rule change                  circuits.14 The Exchange believes that                 the NYSE.
                                                  reflects a competitive pricing structure                the proposed rates are equitable and                      Second, with regard to utilizing Bats
                                                  designed to incent market participants                  non-discriminatory in that they apply                  Connect to receive market data products
                                                  to direct their order flow to the                       uniformly to all Members and non-                      from other exchanges, the Exchange
                                                  Exchange. The Exchange believes that                    Members. Members and non-Members                       only charges subscribers a connectivity
                                                  the proposed rates are equitable and                    will continue to choose whether they                   fee, the amount of which is based solely
                                                  non-discriminatory in that they apply                   want more than one physical port and                   on the amount of bandwidth required to
                                                  uniformly to all Members. The                           choose the method of connectivity                      transmit that specific data product to
                                                  Exchange believes the fees and credits                  based on their specific needs. All                     the subscribers. The Exchange believes
                                                  remain competitive with those charged                   Exchange Members that voluntarily                      it is necessary to increase the rates for
                                                  by other venues and therefore continue                  select various service options will be                 select market data feeds as described
                                                  to be reasonable and equitably allocated                charged the same amount for the same                   herein to address changes in bandwidth
                                                  to Members.                                             services. As is true of all physical                   necessary to receive such feeds. The
                                                     The Exchange believes that the                       connectivity, all Members and non-                     increased fees will also enable the
                                                  proposal represents an equitable                        Members have the option to select any                  Exchange to continue to cover the
                                                  allocation of reasonable dues, fees, and                connectivity option, and there is no                   increased infrastructure costs while also
                                                  other charges as its fees for physical                  differentiation with regard to the fees                enabling it to continue to maintain and
                                                  connectivity are reasonably constrained                 charged for the service.                               improve the service.
                                                  by competitive alternatives. If a                       Logical Ports                                             15 See Nasdaq Rule 7015(b) (charging a fee of $575
                                                  particular exchange charges excessive
                                                                                                            The Exchange believes that the                       per month for FIX Trading Ports) and the NYSE
                                                  fees for connectivity, affected Members                                                                        Arca fee schedule available at https://
                                                  and non-Members may opt to terminate                    increase of fees for logical ports                     www.nyse.com/publicdocs/nyse/markets/nyse-arca/
                                                  their connectivity arrangements with                    represents an equitable allocation of                  NYSE_Arca_Marketplace_Fees.pdf (dated December
                                                  that exchange, and adopt a possible                     reasonable dues, fees and other charges.               2, 2016) (charging a fee of $550 per month for ports
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                                                                                                          The Exchange believes that its proposed                for order/quote entry).
                                                                                                                                                                    16 See Section 3.6.1 of NYSE’s SFTI Americas
                                                    11 The Exchange initially filed the proposed rule     changes to logical port fees are                       Product and Service List available at http://
                                                  change on December 27, 2016. (SR–BatsEDGA–              reasonable in light of the benefits to                 www.nyxdata.com/docs/connectivity.
                                                  2016–33). On January 5, 2017, the Exchange                                                                        17 See e.g., Nasdaq Rule 7034(b) and the Co-
                                                  withdrew SR–BatsEDGA–2016–33 and submitted                14 See Nasdaq Rule 7034(b) and the NYSE Arca         Location section of the NYSE Arca fee schedule
                                                  this filing.                                            fee schedule available at https://www.nyse.com/        available at https://www.nyse.com/publicdocs/
                                                    12 15 U.S.C. 78f.
                                                                                                          publicdocs/nyse/markets/nyse-arca/NYSE_Arca_           nyse/markets/nyse-arca/NYSE_Arca_Marketplace_
                                                    13 15 U.S.C. 78f(b)(4).                               Marketplace_Fees.pdf (dated December 2, 2016).         Fees.pdf (dated December 2, 2016).



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                                                  5622                        Federal Register / Vol. 82, No. 11 / Wednesday, January 18, 2017 / Notices

                                                     The amounts of the connectivity fees                 proposed changes represent a significant                   Electronic Comments
                                                  continue to be reasonable as compared                   departure from previous pricing offered
                                                  to similar fees charged by other                        by the Exchange or pricing offered by                        • Use the Commission’s Internet
                                                  exchanges. For example, for market data                 the Exchange’s competitors.                                comment form (http://www.sec.gov/
                                                  connectivity, Nasdaq charges $1,412 per                 Additionally, Members may opt to                           rules/sro.shtml); or
                                                  month for CQS/CTS data feed, and the                    disfavor the Exchange’s pricing if they                      • Send an email to rule-comments@
                                                  Exchange proposes to charge $1,400 per                  believe that alternatives offer them                       sec.gov. Please include File Number SR–
                                                  month connectivity for CQS/CTS data                     better value. Further, excessive fees for                  BatsEDGA–2017–01 on the subject line.
                                                  feed.18                                                 connectivity would serve to impair an
                                                     The Exchange believes it is reasonable               exchange’s ability to compete for order                    Paper Comments
                                                  to offer such discounted pricing to                     flow rather than burdening competition.
                                                  subscribers who purchase connectivity                      Lastly, the Exchange does not believe                     • Send paper comments in triplicate
                                                  to a bundle of market data products as                  the proposed fees for Bats Connect will                    to Secretary, Securities and Exchange
                                                  it would enable them to reduce their                    result in any burden on competition.                       Commission, 100 F Street NE.,
                                                  overall connectivity costs for the receipt              The proposed rule change is designed to                    Washington, DC 20549–1090.
                                                  of market data. The Exchange is not                     provide subscribers with an alternative                    All submissions should refer to File
                                                  required by any rule or regulation to                   means to access other market centers on                    Number SR–BatsEDGA–2017–01. This
                                                  make Bats Connect available; nor are                    the Exchange’s network if they choose                      file number should be included on the
                                                  subscribers required by any rule or                     or in the event of a market disruption                     subject line if email is used. To help the
                                                  regulation to utilize Bats Connect.                     where other alternative connection                         Commission process and review your
                                                  Accordingly, subscribers can                            methods become unavailable. Bats                           comments more efficiently, please use
                                                  discontinue use at any time and for any                 Connect is not the exclusive method to
                                                                                                                                                                     only one method. The Commission will
                                                  reason, including due to an assessment                  connect to these market centers and
                                                                                                                                                                     post all comments on the Commission’s
                                                  of the reasonableness of fees charged.                  subscribers may utilize alternative
                                                                                                          methods to connect to the product if                       Internet Web site (http://www.sec.gov/
                                                  Moreover, the Exchange believes the
                                                  proposed fees are reasonable and                        they believe the Exchange’s proposed                       rules/sro.shtml). Copies of the
                                                  equitable because they continue to be                   pricing is unreasonable or otherwise.                      submission, all subsequent
                                                  based on the Exchange’s costs to cover                  Therefore, the Exchange does not                           amendments, all written statements
                                                  the amount of bandwidth required to                     believe the proposed rule change will                      with respect to the proposed rule
                                                  provide connectivity to the select                      have any effect on competition.                            change that are filed with the
                                                  bundle of data feeds. The proposed fees                                                                            Commission, and all written
                                                                                                          (C) Self-Regulatory Organization’s                         communications relating to the
                                                  will continue to allow the Exchange to
                                                                                                          Statement on Comments on the                               proposed rule change between the
                                                  recoup this cost, while providing
                                                                                                          Proposed Rule Change Received From                         Commission and any person, other than
                                                  subscribers with an alternative means to
                                                                                                          Members, Participants or Others
                                                  connect to the select bundle of data                                                                               those that may be withheld from the
                                                  feeds at a discounted rate.                               The Exchange has not solicited, and                      public in accordance with the
                                                     Lastly, the Exchange believes the                    does not intend to solicit, comments on                    provisions of 5 U.S.C. 552, will be
                                                  proposed fees are reasonable and                        this proposed rule change. The                             available for Web site viewing and
                                                  equitable because they are based on the                 Exchange has not received any                              printing in the Commission’s Public
                                                  Exchange’s costs to cover hardware,                     unsolicited written comments from                          Reference Room, 100 F Street NE.,
                                                  installation, testing and connection, as                Members or other interested parties.                       Washington, DC 20549, on official
                                                  well as expenses involved in                            III. Date of Effectiveness of the                          business days between the hours of
                                                  maintaining and managing the service.                   Proposed Rule Change and Timing for                        10:00 a.m. and 3:00 p.m. Copies of the
                                                  The proposed fees allow the Exchange                    Commission Action                                          filing also will be available for
                                                  to recoup these costs, while providing                                                                             inspection and copying at the principal
                                                  subscribers with an alternative means to                   The foregoing rule change has become
                                                                                                          effective pursuant to Section 19(b)(3)(A)                  office of the Exchange. All comments
                                                  connect to other exchange and market
                                                                                                          of the Act 19 and paragraph (f) of Rule                    received will be posted without change;
                                                  centers. The Exchange believes that the
                                                  proposed fees are reasonable and                        19b–4 thereunder.20 At any time within                     the Commission does not edit personal
                                                  equitable in that they reflect the costs                60 days of the filing of the proposed rule                 identifying information from
                                                  and the benefit of providing alternative                change, the Commission summarily may                       submissions. You should submit only
                                                  connectivity.                                           temporarily suspend such rule change if                    information that you wish to make
                                                                                                          it appears to the Commission that such                     available publicly. All submissions
                                                  (B) Self-Regulatory Organization’s                      action is necessary or appropriate in the                  should refer to File Number SR–
                                                  Statement on Burden on Competition                      public interest, for the protection of                     BatsEDGA–2017–01 and should be
                                                    The Exchange does not believe that                    investors, or otherwise in furtherance of                  submitted on or before February 8, 2017.
                                                  the proposed rule change will impose                    the purposes of the Act.
                                                                                                                                                                       For the Commission, by the Division of
                                                  any burden on competition not                           IV. Solicitation of Comments                               Trading and Markets, pursuant to delegated
                                                  necessary or appropriate in furtherance                                                                            authority.21
                                                  of the purposes of the Act. As discussed                  Interested persons are invited to
                                                                                                          submit written data, views, and                            Eduardo A. Aleman,
                                                  above, the Exchange believes that fees
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                                                  for connectivity are constrained by the                 arguments concerning the foregoing,                        Assistant Secretary.
                                                  robust competition for order flow among                 including whether the proposed rule                        [FR Doc. 2017–00964 Filed 1–17–17; 8:45 am]
                                                  exchanges and non-exchange markets.                     change is consistent with the Act.                         BILLING CODE 8011–01–P
                                                  The Exchange does not believe that the                  Comments may be submitted by any of
                                                                                                          the following methods:
                                                    18 See Nasdaq Rule 7034 (setting forth Nasdaq’s
                                                                                                            19 15   U.S.C. 78s(b)(3)(A).
                                                  connectivity fees for receipt of third party market
                                                  data products).                                           20 17   CFR 240.19b–4(f).                                  21 17   CFR 200.30–3(a)(12).



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Document Created: 2018-02-01 15:19:48
Document Modified: 2018-02-01 15:19:48
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation82 FR 5619 

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