82 FR 59897 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Amendment No. 2 to Proposed Rule Change Amending the Consolidated Audit Trail Funding Fees

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 240 (December 15, 2017)

Page Range		59897-59900
FR Document		2017-27021

Federal Register, Volume 82 Issue 240 (Friday, December 15, 2017)

[Federal Register Volume 82, Number 240 (Friday, December 15, 2017)]
[Notices]
[Pages 59897-59900]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2017-27021]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82261; File No. SR-NYSE-2017-22]

Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing of Amendment No. 2 to Proposed Rule Change Amending
the Consolidated Audit Trail Funding Fees

December 11, 2017.
On May 10, 2017, New York Stock Exchange LLC (``Exchange'' or
``NYSE'') filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a
proposed rule change to adopt a fee schedule to establish the fees for
Industry Members related to the National Market System Plan Governing
the Consolidated Audit Trail (``CAT NMS Plan''). The proposed rule
change was published in the Federal Register for comment on May 22,
2017.\3\ The Commission received seven comment letters on the proposed
rule change,\4\ and a response to comments from the Participants.\5\ On
June 30, 2017, the Commission temporarily suspended and initiated
proceedings to determine whether to approve or disapprove the proposed
rule change.\6\ The Commission thereafter received seven comment
letters,\7\ and a response to comments from the Participants.\8\ On
October 25, 2017, the Exchange filed Amendment No. 1 to the proposed
rule change.\9\ On November 9, 2017, the Commission extended the time
period within which to approve the proposed rule change or disapprove
the proposed rule change to January 14, 2018.\10\ On November 29, 2017,
the Exchange filed Amendment No. 2 to the proposed rule change, as
described in Items I and II below, which

[[Page 59898]]

Items have been prepared by the Exchange. The Commission is publishing
this notice to solicit comments from interested persons on Amendment
No. 2.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ See Securities Exchange Act Release No. 80693 (May 16,
2017), 82 FR 23363 (May 22, 2017) (``Original Proposal'').
\4\ Since the CAT NMS Plan Participants' proposed rule changes
to adopt fees to be charged to Industry Members to fund the
consolidated audit trail are substantively identical, the Commission
is considering all comments received on the proposed rule changes
regardless of the comment file to which they were submitted. See
text accompanying note 12 infra, for a list of the CAT NMS Plan
Participants. See Letter from Theodore R. Lazo, Managing Director
and Associate General Counsel, Securities Industry and Financial
Markets Association, to Brent J. Fields, Secretary, Commission
(dated June 6, 2017), available at: https://www.sec.gov/comments/sr-batsbzx-2017-38/batsbzx201738-1788188-153228.pdf; Letter from
Patricia L. Cerny and Steven O'Malley, Compliance Consultants, to
Brent J. Fields, Secretary, Commission (dated June 12, 2017),
available at: https://www.sec.gov/comments/sr-cboe-2017-040/cboe2017040-1799253-153675.pdf; Letter from Daniel Zinn, General
Counsel, OTC Markets Group Inc., to Eduardo A. Aleman, Assistant
Secretary, Commission (dated June 13, 2017), available at: https://www.sec.gov/comments/sr-finra-2017-011/finra2017011-1801717-153703.pdf; Letter from Joanna Mallers, Secretary, FIA Principal
Traders Group, to Brent J. Fields, Secretary, Commission (dated June
22, 2017), available at: https://www.sec.gov/comments/sr-cboe-2017-040/cboe2017040-1819670-154195.pdf; Letter from Stuart J. Kaswell,
Executive Vice President and Managing Director, General Counsel,
Managed Funds Association, to Brent J. Fields, Secretary, Commission
(dated June 23, 2017), available at: https://www.sec.gov/comments/sr-finra-2017-011/finra2017011-1822454-154283.pdf; and Letter from
Suzanne H. Shatto, Investor, to Commission (dated June 27, 2017),
available at: https://www.sec.gov/comments/sr-batsedgx-2017-22/batsedgx201722-154443.pdf. The Commission also received a comment
letter which is not pertinent to these proposed rule changes. See
Letter from Christina Crouch, Smart Ltd., to Brent J. Fields,
Secretary, Commission (dated June 5, 2017), available at: https://www.sec.gov/comments/sr-batsbzx-2017-38/batsbzx201738-1785545-153152.htm.
\5\ See Letter from CAT NMS Plan Participants to Brent J.
Fields, Secretary, Commission (dated June 29, 2017), available at:
https://www.sec.gov/comments/sr-batsbyx-2017-11/batsbyx201711-1832632-154584.pdf.
\6\ See Securities Exchange Act Release No. 81067 (June 30,
2017), 82 FR 31656 (July 7, 2017).
\7\ See Letter from W. Hardy Callcott, Partner, Sidley Austin
LLP, to Brent J. Fields, Secretary, Commission (dated July 27,
2017), available at: https://www.sec.gov/comments/sr-batsbyx-2017-11/batsbyx201711-2148338-157737.pdf; Letter from Kevin Coleman,
General Counsel and Chief Compliance Officer, Belvedere Trading LLC,
to Brent J. Fields, Secretary, Commission (dated July 28, 2017),
available at: https://www.sec.gov/comments/sr-batsbyx-2017-11/batsbyx201711-2148360-157740.pdf; Letter from Joanna Mallers,
Secretary, FIA Principal Traders Group, to Brent J. Fields,
Secretary, Commission (dated July 28, 2017), available at: https://www.sec.gov/comments/sr-batsbyx-2017-11/batsbyx201711-2151228-157745.pdf; Letter from Theodore R. Lazo, Managing Director and
Associate General Counsel, SIFMA, to Brent J. Fields, Secretary,
Commission (dated July 28, 2017), available at: https://www.sec.gov/comments/sr-batsbyx-2017-11/batsbyx201711-2150977-157744.pdf; Letter
from Stuart J. Kaswell, Executive Vice President and Managing
Director, General Counsel, Managed Funds Association, to Brent J.
Fields, Secretary, Commission (dated July 28, 2017), available at:
https://www.sec.gov/comments/sr-batsbyx-2017-11/batsbyx201711-2150818-157743.pdf; Letter from John Kinahan, Chief Executive
Officer, Group One Trading, L.P., to Brent J. Fields, Secretary,
Commission (dated August 10, 2017), available at: https://
www.sec.gov/comments/sr-finra-2017-011/finra2017011-2214568-160619.pdf; Letter from Joseph Molluso, Executive Vice President and
CFO, Virtu Financial, to Brent J. Fields, Commission (dated August
18, 2017), available at: https://www.sec.gov/comments/sr-finra-2017-011/finra2017011-2238648-160830.pdf.
\8\ See Letter from Michael Simon, Chair, CAT NMS Plan Operating
Committee, to Brent J. Fields, Commission, Secretary (dated November
2, 2017), available at https://www.sec.gov/comments/sr-batsbyx-2017-11/batsbyx201711-2674608-161412.pdf.
\9\ Amendment No. 1 to the proposed rule change replaced and
superseded the Original Proposal in its entirety. See Securities
Exchange Act Release No. 82260 (December 11, 2017).
\10\ See Securities Exchange Act Release No. 82049 (November 9,
2017), 82 FR 53549 (November 16, 2017).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

The Exchange proposes to amend the NYSE Price List (``Price List'')
to adopt the fees for Industry Members related to the National Market
System Plan Governing the Consolidated Audit Trail (the ``CAT NMS
Plan'' or ``Plan'').\11\ On October 25, 2017, NYSE filed an amendment
to the Original Proposal (``First Amendment''). The Exchange files this
proposed rule change (the ``Second Amendment'') to amend the Original
Proposal, as amended by the First Amendment. The proposed rule change
is available on the Exchange's website at www.nyse.com, at the
principal office of the Exchange, and at the Commission's Public
Reference Room.
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\11\ Unless otherwise specified, capitalized terms used in this
rule filing are defined as set forth herein, the CAT Compliance Rule
or in the CAT NMS Plan.
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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
BOX Options Exchange LLC, Cboe BYX Exchange, Inc., Cboe BZX
Exchange, Inc., Cboe EDGA Exchange, Inc., Cboe EDGX Exchange, Inc.,
Cboe C2 Exchange, Inc., Cboe Exchange, Inc., Chicago Stock Exchange,
Inc., Financial Industry Regulatory Authority, Inc. (``FINRA''),
Investors' Exchange LLC, Miami International Securities Exchange, LLC,
MIAX PEARL, LLC, NASDAQ BX, Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC,
Nasdaq MRX, LLC, NASDAQ PHLX LLC, The NASDAQ Stock Market LLC, New York
Stock Exchange LLC, NYSE American LLC, NYSE Arca, Inc. and NYSE
National, Inc.\12\ (collectively, the ``Participants'') filed with the
Commission, pursuant to Section 11A of the Exchange Act\13\ and Rule
608 of Regulation NMS thereunder,\14\ the CAT NMS Plan.\15\ The
Participants filed the Plan to comply with Rule 613 of Regulation NMS
under the Exchange Act. The Plan was published for comment in the
Federal Register on May 17, 2016,\16\ and approved by the Commission,
as modified, on November 15, 2016.\17\ The Plan is designed to create,
implement and maintain a consolidated audit trail (``CAT'') that would
capture customer and order event information for orders in NMS
Securities and OTC Equity Securities, across all markets, from the time
of order inception through routing, cancellation, modification, or
execution in a single consolidated data source. The Plan accomplishes
this by creating CAT NMS, LLC (the ``Company''), of which each
Participant is a member, to operate the CAT.\18\ Under the CAT NMS
Plan, the Operating Committee of the Company (``Operating Committee'')
has discretion to establish funding for the Company to operate the CAT,
including establishing fees that the Participants will pay, and
establishing fees for Industry Members that will be implemented by the
Participants (``CAT Fees'').\19\ The Participants are required to file
with the SEC under Section 19(b) of the Exchange Act any such CAT Fees
applicable to Industry Members that the Operating Committee
approves.\20\ Accordingly, the Exchange submitted the Original Proposal
to adopt the Consolidated Audit Trail Funding Fees, which would require
Industry Members that are Exchange members to pay the CAT Fees
determined by the Operating Committee.
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\12\ Note that Bats BYX Exchange, Inc., Bats BZX Exchange, Inc.,
Bats EDGA Exchange, Inc., Bats EDGX Exchange, Inc., LLC, C2 Options
Exchange, Incorporated, and Chicago Board Options Exchange,
Incorporated, have been renamed Cboe BYX Exchange, Inc., Cboe BZX
Exchange, Inc., Cboe EDGA Exchange, Inc., Cboe EDGX Exchange, Inc.,
Cboe C2 Exchange, Inc., Cboe Exchange, Inc., respectively.
\13\ 15 U.S.C. 78k-1.
\14\ 17 CFR 242.608.
\15\ See Letter from the Participants to Brent J. Fields,
Secretary, Commission, dated September 30, 2014; and Letter from
Participants to Brent J. Fields, Secretary, Commission, dated
February 27, 2015. On December 24, 2015, the Participants submitted
an amendment to the CAT NMS Plan. See Letter from Participants to
Brent J. Fields, Secretary, Commission, dated December 23, 2015.
\16\ Securities Exchange Act Rel. No. 77724 (Apr. 27, 2016), 81
FR 30614 (May 17, 2016).
\17\ Securities Exchange Act Rel. No. 79318 (Nov. 15, 2016), 81
FR 84696 (Nov. 23, 2016) (``Approval Order'').
\18\ The Plan also serves as the limited liability company
agreement for the Company.
\19\ Section 11.1(b) of the CAT NMS Plan.
\20\ Id.
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The Commission published the Original Proposal for public comment
in the Federal Register on May 22, 2017,\21\ and received comments in
response to the Original Proposal or similar fee filings by other
Participants.\22\ On June 30, 2017, the Commission suspended, and
instituted proceedings to determine whether to approve or disapprove,
the Original Proposal.\23\ The Commission received seven comment
letters in response to those proceedings.\24\
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\21\ Securities Exchange Act Rel. No. 80693 (May 16, 2017), 82
FR 23363 (May 22, 2017) (SR-NYSE-2017-22).
\22\ For a summary of comments, see generally Securities
Exchange Act Rel. No. 81067 (June 30, 2017), 82 FR 31656 (July 7,
2017) (``Suspension Order'').
\23\ Suspension Order.
\24\ See Letter from Stuart J. Kaswell, Executive Vice
President, Managing Director and General Counsel, Managed Funds
Association, to Brent J. Fields, Secretary, SEC (July 28, 2017)
(``MFA Letter''); Letter from Theodore R. Lazo, Managing Director
and Associate General Counsel, SIFMA, to Brent J. Fields, Secretary,
SEC (July 28, 2017) (``SIFMA Letter''); Joanna Mallers, Secretary,
FIA Principal Traders Group, to Brent J. Fields, Secretary, SEC
(July 28, 2017) (``FIA Principal Traders Group Letter''); Letter
from Kevin Coleman, General Counsel & Chief Compliance Officer,
Belvedere Trading LLC, to Brent J. Fields, Secretary, SEC (July 28,
2017) (``Belvedere Letter''); Letter from W. Hardy Callcott, Sidley
Austin LLP, to Brent J. Fields, Secretary, SEC (July 27, 2017)
(``Sidley Letter''); Letter from John Kinahan, Chief Executive
Officer, Group One Trading, L.P., to Brent J. Fields, Secretary, SEC
(Aug. 10, 2017) (``Group One Letter''); and Letter from Joseph
Molluso, Executive Vice President, Virtu Financial, to Brent J.
Fields, Secretary, SEC (Aug. 18, 2017) (``Virtu Financial Letter'').
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In response to the comments on the Original Proposal, the Operating
Committee determined to make the following changes to the funding
model: (1) Add two additional CAT Fee tiers for Equity Execution
Venues; (2) discount the market share of Execution Venue ATSs
exclusively trading OTC Equity Securities as well as the market share
of the FINRA over-the-counter reporting facility (``ORF'') by the
average shares per trade ratio between NMS Stocks and OTC Equity
Securities (calculated as 0.17% based on available data from the second
quarter of June 2017) when calculating the market share of Execution
Venue ATS exclusively trading OTC Equity Securities and FINRA; (3)
discount the Options Market Maker quotes by the trade to quote ratio
for options (calculated as 0.01% based on available data for June 2016
through June 2017) when calculating message traffic for Options Market
Makers; (4) discount equity market maker quotes by the trade to quote
ratio for equities (calculated as 5.43% based on available

[[Page 59899]]

data for June 2016 through June 2017) when calculating message traffic
for equity market makers; (5) decrease the number of tiers for Industry
Members (other than the Execution Venue ATSs) from nine to seven; (6)
change the allocation of CAT costs between Equity Execution Venues and
Options Execution Venues from 75%/25% to 67%/33%; (7) adjust tier
percentages and recovery allocations for Equity Execution Venues,
Options Execution Venues and Industry Members (other than Execution
Venue ATSs); (8) focus the comparability of CAT Fees on the individual
entity level, rather than primarily on the comparability of affiliated
entities; (9) commence invoicing of CAT Reporters as promptly as
possible following the latest of the operative date of the Consolidated
Audit Trail Funding Fees for each of the Participants and the operative
date of the CAT NMS Plan amendment adopting CAT Fees for Participants;
and (10) require the proposed fees to automatically expire two years
from the operative date of the CAT NMS Plan amendment adopting CAT Fees
for Participants. On October 25, 2017, the Exchange filed the First
Amendment and proposed to amend the Original Proposal to reflect these
changes.
NYSE submits this Second Amendment to the revise the proposal as
set forth in the First Amendment to discount the OTC Equity Securities
market share of all Execution Venue ATSs trading OTC Equity Securities,
rather than applying the discount solely to those Execution Venue ATSs
that exclusively trade OTC Equity Securities, when calculating the
market share of Execution Venue ATS trading OTC Equity Securities. As
discussed in the First Amendment:

The Operating Committee determined to discount the market share
of Execution Venue ATSs exclusively trading OTC Equity Securities as
well as the market share of the FINRA ORF in recognition of the
different trading characteristics of the OTC Equity Securities
market as compared to the market in NMS Stocks. Many OTC Equity
Securities are priced at less than one dollar--and a significant
number at less than one penny--per share and low-priced shares tend
to trade in larger quantities. Accordingly, a disproportionately
large number of shares are involved in transactions involving OTC
Equity Securities versus NMS Stocks. Because the proposed fee tiers
are based on market share calculated by share volume, Execution
Venue ATSs exclusively trading OTC Equity Securities and FINRA would
likely be subject to higher tiers than their operations may
warrant.\25\
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\25\ See SR-NYSE-2017-22, Amendment 1, Section 3(a), at page 23.

The Operating Committee believes that this argument applies equally
to both Execution Venue ATSs exclusively trading OTC Equity Securities
and to Execution Venue ATSs that trade OTC Equity Securities as well as
other securities. Accordingly, NYSE proposes to amend paragraph (b)(2)
of the Consolidated Audit Trail Funding Fees to apply the discount to
all Execution Venue ATSs trading OTC Equity Securities. Specifically,
the Exchange proposes to change the parenthetical regarding the OTC
Equity Securities discount in paragraph (b)(2) of the proposed fee
schedule from ``with a discount for Equity ATSs exclusively trading OTC
Equity Securities based on the average shares per trade ratio between
NMS Stocks and OTC Equity Securities'' to ``with a discount for OTC
Equity Securities market share of Equity ATSs trading OTC Equity
Securities based on the average shares per trade ratio between NMS
Stocks and OTC Equity Securities.''
Additionally, the Exchange proposes to delete footnote 45 in
Section 3(a) on page 23 of the First Amendment as the footnote is
erroneous and was included inadvertently.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6(b)(4) of the Act,\26\ because it
provides for the equitable allocation of reasonable dues, fees, and
other charges among members and issuers and other persons using its
facilities. The Exchange believes the proposed rule change is also
consistent with Section 6(b)(5) of the Act,\27\ which requires, among
other things, that the Exchange's rules be designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, and, in general, to protect investors
and the public interest, and not designed to permit unfair
discrimination between customers, issuers, brokers and dealers. The
Exchange believes that the proposed rule change is consistent with the
Act, and that the proposed fees are reasonable, equitably allocated and
not unfairly discriminatory. In particular, the Exchange believes that
the proposed rule change would treat all Equity ATSs trading OTC Equity
Securities in a comparable manner when calculating applicable fees. In
addition, the proposed fee structure would take into consideration
distinctions in securities trading operations of CAT Reporters,
including all ATSs trading OTC Equity Securities.
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\26\ 15 U.S.C. 78f(b)(4).
\27\ 15 U.S.C. 78f(b)(6).
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B. Self-Regulatory Organization's Statement on Burden on Competition

Section 6(b)(8) of the Act \28\ require that the Exchange's rules
not impose any burden on competition that is not necessary or
appropriate. The Exchange does not believe that the proposed rule
change will result in any burden on competition that is not necessary
or appropriate in furtherance of the purposes of the Act. As previously
described, the Exchange believes that the proposed rule change fairly
and equitably allocates costs among CAT Reporters. In particular, the
proposed rule change is structured to impose comparable fees on
similarly situated CAT Reporters. The Exchange believes that the
proposed rule change would treat all Equity ATSs trading OTC Equity
Securities in a comparable manner when calculating applicable fees. In
addition, the proposed rule change would take into consideration
distinctions in securities trading operations of CAT Reporters,
including all ATSs trading OTC Equity Securities. Moreover, the
Operating Committee believes that the proposed rule change addresses
certain competitive concerns raised by commenters related to ATSs
trading OTC Equity Securities.
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\28\ 15 U.S.C. 78f(b)(8).
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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. Solicitation of Comments

Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposal, as
amended by Amendment No. 1 and Amendment No. 2, 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-NYSE-2017-22 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.

[[Page 59900]]

All submissions should refer to File Number SR-NYSE-2017-22. 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 website (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 website 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. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NYSE-2017-22, and should be submitted on
or before January 5, 2018.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\29\
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\29\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2017-27021 Filed 12-14-17; 8:45 am]
BILLING CODE 8011-01-P

Federal Register / Vol. 82, No. 240 / Friday, December 15, 2017 / Notices 59897

Paper Comments SECURITIES AND EXCHANGE comments from the Participants.5 On
COMMISSION June 30, 2017, the Commission
• Send paper comments in triplicate temporarily suspended and initiated
to Secretary, Securities and Exchange [Release No. 34–82261; File No. SR–NYSE–
2017–22]
proceedings to determine whether to
Commission, 100 F Street NE, approve or disapprove the proposed
Washington, DC 20549–1090. Self-Regulatory Organizations; New rule change.6 The Commission
All submissions should refer to File York Stock Exchange LLC; Notice of thereafter received seven comment
Filing of Amendment No. 2 to letters,7 and a response to comments
Number SR–CBOE–2017–040. This file
Proposed Rule Change Amending the from the Participants.8 On October 25,
number should be included on the
Consolidated Audit Trail Funding Fees 2017, the Exchange filed Amendment
subject line if email is used. To help the No. 1 to the proposed rule change.9 On
Commission process and review your December 11, 2017. November 9, 2017, the Commission
comments more efficiently, please use On May 10, 2017, New York Stock extended the time period within which
only one method. The Commission will Exchange LLC (‘‘Exchange’’ or ‘‘NYSE’’) to approve the proposed rule change or
post all comments on the Commission’s filed with the Securities and Exchange disapprove the proposed rule change to
internet website (http://www.sec.gov/ Commission (‘‘Commission’’), pursuant January 14, 2018.10 On November 29,
rules/sro.shtml). Copies of the to Section 19(b)(1) of the Securities 2017, the Exchange filed Amendment
submission, all subsequent Exchange Act of 1934 (‘‘Act’’) 1 and Rule No. 2 to the proposed rule change, as
amendments, all written statements 19b–4 thereunder,2 a proposed rule described in Items I and II below, which
with respect to the proposed rule change to adopt a fee schedule to
change that are filed with the establish the fees for Industry Members Commission (dated June 5, 2017), available at:
Commission, and all written related to the National Market System https://www.sec.gov/comments/sr-batsbzx-2017-38/
Plan Governing the Consolidated Audit batsbzx201738-1785545-153152.htm.
communications relating to the 5 See Letter from CAT NMS Plan Participants to

proposed rule change between the Trail (‘‘CAT NMS Plan’’). The proposed Brent J. Fields, Secretary, Commission (dated June
Commission and any person, other than rule change was published in the 29, 2017), available at: https://www.sec.gov/
Federal Register for comment on May comments/sr-batsbyx-2017-11/batsbyx201711-
those that may be withheld from the 1832632-154584.pdf.
22, 2017.3 The Commission received
public in accordance with the 6 See Securities Exchange Act Release No. 81067
seven comment letters on the proposed
provisions of 5 U.S.C. 552, will be rule change,4 and a response to
(June 30, 2017), 82 FR 31656 (July 7, 2017).
7 See Letter from W. Hardy Callcott, Partner,
available for website viewing and
Sidley Austin LLP, to Brent J. Fields, Secretary,
printing in the Commission’s Public 1 15 U.S.C. 78s(b)(1). Commission (dated July 27, 2017), available at:
Reference Room, 100 F Street NE, 2 17 CFR 240.19b–4. https://www.sec.gov/comments/sr-batsbyx-2017-11/
Washington, DC 20549, on official 3 See Securities Exchange Act Release No. 80693 batsbyx201711-2148338-157737.pdf; Letter from
(May 16, 2017), 82 FR 23363 (May 22, 2017) Kevin Coleman, General Counsel and Chief
business days between the hours of Compliance Officer, Belvedere Trading LLC, to
(‘‘Original Proposal’’).
10:00 a.m. and 3:00 p.m. Copies of the 4 Since the CAT NMS Plan Participants’ proposed Brent J. Fields, Secretary, Commission (dated July
filing also will be available for rule changes to adopt fees to be charged to Industry 28, 2017), available at: https://www.sec.gov/
comments/sr-batsbyx-2017-11/batsbyx201711-
inspection and copying at the principal Members to fund the consolidated audit trail are
2148360-157740.pdf; Letter from Joanna Mallers,
substantively identical, the Commission is
office of the Exchange. All comments considering all comments received on the proposed Secretary, FIA Principal Traders Group, to Brent J.
received will be posted without change. rule changes regardless of the comment file to Fields, Secretary, Commission (dated July 28, 2017),
available at: https://www.sec.gov/comments/sr-
Persons submitting comments are which they were submitted. See text accompanying
batsbyx-2017-11/batsbyx201711-2151228-
cautioned that we do not redact or edit note 12 infra, for a list of the CAT NMS Plan
Participants. See Letter from Theodore R. Lazo, 157745.pdf; Letter from Theodore R. Lazo,
personal identifying information from Managing Director and Associate General Counsel, Managing Director and Associate General Counsel,
comment submissions. You should Securities Industry and Financial Markets SIFMA, to Brent J. Fields, Secretary, Commission
Association, to Brent J. Fields, Secretary, (dated July 28, 2017), available at: https://
submit only information that you wish www.sec.gov/comments/sr-batsbyx-2017-11/
Commission (dated June 6, 2017), available at:
to make available publicly. All https://www.sec.gov/comments/sr-batsbzx-2017-38/ batsbyx201711-2150977-157744.pdf; Letter from
submissions should refer to File batsbzx201738-1788188-153228.pdf; Letter from Stuart J. Kaswell, Executive Vice President and
Patricia L. Cerny and Steven O’Malley, Compliance Managing Director, General Counsel, Managed
Number SR–CBOE–2017–040, and Funds Association, to Brent J. Fields, Secretary,
Consultants, to Brent J. Fields, Secretary,
should be submitted on or before Commission (dated June 12, 2017), available at: Commission (dated July 28, 2017), available at:
January 5, 2018. https://www.sec.gov/comments/sr-cboe-2017-040/ https://www.sec.gov/comments/sr-batsbyx-2017-11/
cboe2017040-1799253-153675.pdf; Letter from batsbyx201711-2150818-157743.pdf; Letter from
For the Commission, by the Division of Daniel Zinn, General Counsel, OTC Markets Group John Kinahan, Chief Executive Officer, Group One
Trading and Markets, pursuant to delegated Inc., to Eduardo A. Aleman, Assistant Secretary, Trading, L.P., to Brent J. Fields, Secretary,
Commission (dated June 13, 2017), available at: Commission (dated August 10, 2017), available at:
authority.98 https://www.sec.gov/comments/sr-finra-2017-011/
https://www.sec.gov/comments/sr-finra-2017-011/
Robert W. Errett, finra2017011-1801717-153703.pdf; Letter from finra2017011-2214568-160619.pdf; Letter from
Joseph Molluso, Executive Vice President and CFO,
Deputy Secretary. Joanna Mallers, Secretary, FIA Principal Traders
Group, to Brent J. Fields, Secretary, Commission Virtu Financial, to Brent J. Fields, Commission
[FR Doc. 2017–26994 Filed 12–14–17; 8:45 am] (dated August 18, 2017), available at: https://
(dated June 22, 2017), available at: https://
BILLING CODE 8011–01–P www.sec.gov/comments/sr-cboe-2017-040/ www.sec.gov/comments/sr-finra-2017-011/
cboe2017040-1819670-154195.pdf; Letter from finra2017011-2238648-160830.pdf.
8 See Letter from Michael Simon, Chair, CAT
Stuart J. Kaswell, Executive Vice President and
Managing Director, General Counsel, Managed NMS Plan Operating Committee, to Brent J. Fields,
Funds Association, to Brent J. Fields, Secretary, Commission, Secretary (dated November 2, 2017),
Commission (dated June 23, 2017), available at: available at https://www.sec.gov/comments/sr-
sradovich on DSK3GMQ082PROD with NOTICES

https://www.sec.gov/comments/sr-finra-2017-011/ batsbyx-2017-11/batsbyx201711-2674608-
finra2017011-1822454-154283.pdf; and Letter from 161412.pdf.
9 Amendment No. 1 to the proposed rule change
Suzanne H. Shatto, Investor, to Commission (dated
June 27, 2017), available at: https://www.sec.gov/ replaced and superseded the Original Proposal in
comments/sr-batsedgx-2017-22/batsedgx201722- its entirety. See Securities Exchange Act Release
154443.pdf. The Commission also received a No. 82260 (December 11, 2017).
comment letter which is not pertinent to these 10 See Securities Exchange Act Release No. 82049

proposed rule changes. See Letter from Christina (November 9, 2017), 82 FR 53549 (November 16,
98 17 CFR 200.30–3(a)(12). Crouch, Smart Ltd., to Brent J. Fields, Secretary, 2017).

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59900 Federal Register / Vol. 82, No. 240 / Friday, December 15, 2017 / Notices

All submissions should refer to File SECURITIES AND EXCHANGE and a response to comments from the
Number SR–NYSE–2017–22. This file COMMISSION CAT NMS Plan Participants.5 On June
number should be included on the 30, 2017, the Commission temporarily
[Release No. 34–82279; File No. SR– suspended and initiated proceedings to
subject line if email is used. To help the BatsBZX–2017–38]
Commission process and review your determine whether to approve or
comments more efficiently, please use Self-Regulatory Organizations; Cboe disapprove the proposed rule change.6
only one method. The Commission will BZX Exchange, Inc.; Notice of Filing of The Commission thereafter received
post all comments on the Commission’s Amendment No. 2 to the Proposed seven comment letters,7 and a response
internet website (http://www.sec.gov/ Rule Change To Amend the Schedule to comments from the Participants.8 On
of Fees and Assessments To Adopt a November 3, 2017, the Exchange filed
rules/sro.shtml). Copies of the
Fee Schedule To Establish Fees for Amendment No. 1 to the proposed rule
submission, all subsequent
Industry Members Related to the change.9 On November 9, 2017, the
amendments, all written statements Commission extended the time period
with respect to the proposed rule National Market System Plan
Governing the Consolidated Audit Trail within which to approve the proposed
change that are filed with the rule change or disapprove the proposed
Commission, and all written December 11, 2017.
communications relating to the finra2017011-1822454-154283.pdf; and Letter from
proposed rule change between the I. Introduction Suzanne H. Shatto, Investor, to Commission (dated
Commission and any person, other than June 27, 2017), available at: https://www.sec.gov/
On May 23, 2017, Bats BZX Exchange comments/sr-batsedgx-2017-22/batsedgx201722-
those that may be withheld from the Inc., n/k/a Cboe BZX Exchange, Inc., 154443.pdf. The Commission also received a
public in accordance with the (‘‘Exchange’’ or ‘‘SRO’’) filed with the comment letter which is not pertinent to these
provisions of 5 U.S.C. 552, will be Securities and Exchange Commission proposed rule changes. See Letter from Christina
Crouch, Smart Ltd., to Brent J. Fields, Secretary,
available for website viewing and (‘‘Commission’’), pursuant to Section Commission (dated June 5, 2017), available at:
printing in the Commission’s Public 19(b)(1) of the Securities Exchange Act https://www.sec.gov/comments/sr-batsbzx-2017-38/
Reference Room, 100 F Street NE, of 1934 (‘‘Act’’) 1 and Rule 19b–4 batsbzx201738-1785545-153152.htm.
5 See Letter from CAT NMS Plan Participants to
Washington, DC 20549, on official thereunder,2 a proposed rule change to
Brent J. Fields, Secretary, Commission (dated June
business days between the hours of adopt a fee schedule to establish the fees 29, 2017), available at: https://www.sec.gov/
10:00 a.m. and 3:00 p.m. Copies of the for Industry Members related to the comments/sr-batsbyx-2017-11/batsbyx201711-
filing also will be available for National Market System Plan Governing 1832632-154584.pdf.
6 See Securities Exchange Act Release No. 81067
inspection and copying at the principal the Consolidated Audit Trail (‘‘CAT
(June 30, 2017), 82 FR 31656 (July 7, 2017).
office of the Exchange. All comments NMS Plan’’). The proposed rule change 7 See Letter from W. Hardy Callcott, Partner,

received will be posted without change. was published in the Federal Register Sidley Austin LLP, to Brent J. Fields, Secretary,
for comment on June 6, 2017.3 The Commission (dated July 27, 2017), available at:
Persons submitting comments are
Commission received seven comment https://www.sec.gov/comments/sr-batsbyx-2017-11/
cautioned that we do not redact or edit batsbyx201711-2148338-157737.pdf; Letter from
letters on the proposed rule change,4
personal identifying information from Kevin Coleman, General Counsel and Chief
comment submissions. You should Compliance Officer, Belvedere Trading LLC, to
1 15 U.S.C. 78s(b)(1). Brent J. Fields, Secretary, Commission (dated July
submit only information that you wish 2 17 CFR 240.19b–4. 28, 2017), available at: https://www.sec.gov/
to make available publicly. All 3 See Securities Exchange Act Release No. 80822 comments/sr-batsbyx-2017-11/batsbyx201711-
submissions should refer to File (May 31, 2017), 82 FR 26148 (June 6, 2017) 2148360-157740.pdf; Letter from Joanna Mallers,
(‘‘Original Proposal’’). Secretary, FIA Principal Traders Group, to Brent J.
Number SR–NYSE–2017–22, and 4 Since the CAT NMS Plan Participants’ proposed Fields, Secretary, Commission (dated July 28, 2017),
should be submitted on or before rule changes to adopt fees to be charged to Industry available at: https://www.sec.gov/comments/sr-
January 5, 2018. Members to fund the consolidated audit trail are batsbyx-2017-11/batsbyx201711-2151228-
substantively identical, the Commission is 157745.pdf; Letter from Theodore R. Lazo,
For the Commission, by the Division of considering all comments received on the proposed Managing Director and Associate General Counsel,
Trading and Markets, pursuant to delegated rule changes regardless of the comment file to SIFMA, to Brent J. Fields, Secretary, Commission
authority.29 which they were submitted. See text accompanying (dated July 28, 2017), available at: https://
note 12 infra, for a list of the CAT NMS Plan www.sec.gov/comments/sr-batsbyx-2017-11/
Robert W. Errett, Participants. See Letter from Theodore R. Lazo, batsbyx201711-2150977-157744.pdf; Letter from
Deputy Secretary. Managing Director and Associate General Counsel, Stuart J. Kaswell, Executive Vice President and
Securities Industry and Financial Markets Managing Director, General Counsel, Managed
[FR Doc. 2017–27021 Filed 12–14–17; 8:45 am] Funds Association, to Brent J. Fields, Secretary,
Association, to Brent J. Fields, Secretary,
BILLING CODE 8011–01–P Commission (dated June 6, 2017), available at: Commission (dated July 28, 2017), available at:
https://www.sec.gov/comments/sr-batsbzx-2017-38/ https://www.sec.gov/comments/sr-batsbyx-2017-11/
batsbzx201738-1788188-153228.pdf; Letter from batsbyx201711-2150818-157743.pdf; Letter from
Patricia L. Cerny and Steven O’Malley, Compliance John Kinahan, Chief Executive Officer, Group One
Consultants, to Brent J. Fields, Secretary, Trading, L.P., to Brent J. Fields, Secretary,
Commission (dated June 12, 2017), available at: Commission (dated August 10, 2017), available at:
https://www.sec.gov/comments/sr-cboe-2017-040/ https://www.sec.gov/comments/sr-finra-2017-011/
cboe2017040-1799253-153675.pdf; Letter from finra2017011-2214568-160619.pdf; Letter from
Daniel Zinn, General Counsel, OTC Markets Group Joseph Molluso, Executive Vice President and CFO,
Inc., to Eduardo A. Aleman, Assistant Secretary, Virtu Financial, to Brent J. Fields, Commission
Commission (dated June 13, 2017), available at: (dated August 18, 2017), available at: https://
https://www.sec.gov/comments/sr-finra-2017-011/ www.sec.gov/comments/sr-finra-2017-011/
finra2017011-1801717-153703.pdf; Letter from finra2017011-2238648-160830.pdf.
8 See Letter from Michael Simon, Chair, CAT
Joanna Mallers, Secretary, FIA Principal Traders
sradovich on DSK3GMQ082PROD with NOTICES

Group, to Brent J. Fields, Secretary, Commission NMS Plan Operating Committee, to Brent J. Fields,
(dated June 22, 2017), available at: https:// Commission, Secretary (dated November 2, 2017),
www.sec.gov/comments/sr-cboe-2017-040/ available at: https://www.sec.gov/comments/sr-
cboe2017040-1819670-154195.pdf; Letter from batsbyx-2017-11/batsbyx201711-2674608-
Stuart J. Kaswell, Executive Vice President and 161412.pdf.
Managing Director, General Counsel, Managed 9 Amendment No. 1 to the proposed rule change

Funds Association, to Brent J. Fields, Secretary, replaced and superseded the Original Proposal in
Commission (dated June 23, 2017), available at: its entirety. See Securities Exchange Act Release
29 17 CFR 200.30–3(a)(12). https://www.sec.gov/comments/sr-finra-2017-011/ No. 34–82278 (December 11, 2017).

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Document Created: 2017-12-15 03:37:45
Document Modified: 2017-12-15 03:37:45

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 59897