83_FR_20206 83 FR 20118 - Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify its Fee Schedule To Charge a More Deterministic Fee of $0.0003 Per Share for Executions at or Above $1.00 That Result From Removing Liquidity With an Order That is Executable at the Far Side of the NBBO

83 FR 20118 - Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify its Fee Schedule To Charge a More Deterministic Fee of $0.0003 Per Share for Executions at or Above $1.00 That Result From Removing Liquidity With an Order That is Executable at the Far Side of the NBBO

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 88 (May 7, 2018)

Page Range20118-20123
FR Document2018-09577

Federal Register, Volume 83 Issue 88 (Monday, May 7, 2018) 
[Federal Register Volume 83, Number 88 (Monday, May 7, 2018)]
[Notices]
[Pages 20118-20123]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-09577]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83147; File No. SR-IEX-2018-09]


Self-Regulatory Organizations; Investors Exchange LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Modify 
its Fee Schedule To Charge a More Deterministic Fee of $0.0003 Per 
Share for Executions at or Above $1.00 That Result From Removing 
Liquidity With an Order That is Executable at the Far Side of the NBBO

May 1, 2018.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on April 20, 2018, the Investors Exchange LLC (``IEX'' or 
the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I, 
II and III below, which Items have been prepared by the self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Pursuant to the provisions of Section 19(b)(1) under the Securities 
Exchange Act of 1934 (``Act''),\4\ and Rule 19b-4 thereunder,\5\ 
Investors Exchange LLC (``IEX'' or ``Exchange'') is filing with the 
Securities and Exchange Commission (``Commission'') a proposed rule 
change to modify its Fee Schedule, pursuant to IEX Rule 15.110(a) and 
(c), to charge a more deterministic fee of $0.0003 per share for 
executions at or above $1.00 that result from removing liquidity with 
an order that is executable at the far side of the NBBO \6\ (the 
``Spread-Crossing Remove Fee''). Consistent with the Exchange's 
existing Fee Schedule, executions below $1.00 will be 0.30% of the 
total dollar value of the transaction. Changes to the Fee Schedule 
pursuant to this proposal are effective upon filing and will be 
operative on May 1, 2018.
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    \4\ 15 U.S.C. 78s(b)(1).
    \5\ 17 CFR 240.19b-4.
    \6\ As defined by Regulation NMS Rule 600(b)(42). 17 CFR 
242.600.
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    The text of the proposed rule change is available at the Exchange's 
website at www.iextrading.com, at the principal office of the Exchange, 
and at the Commission's Public Reference Room.

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

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

[[Page 20119]]

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

1. Purpose
    The Exchange proposes to modify its Fee Schedule, pursuant to IEX 
Rule 15.110(a) and (c), to charge a more deterministic fee of $0.0003 
per share for executions at or above $1.00 that result from removing 
liquidity with an order that is executable at the far side of the NBBO 
(i.e., a buy order that is executable at the NBO or higher, or a sell 
order that is executable at the NBB or lower). In an effort to 
incentivize Members to submit displayed orders to the Exchange, the 
Exchange currently charges a fee of $0.0003 per share (or 0.30% of the 
total dollar value of the transaction for securities priced below 
$1.00) to Members for executions on IEX that provide or take resting 
interest with displayed priority (i.e., an order or portion of a 
reserve order that is booked and ranked with display priority on the 
Order Book).\7\ Furthermore, the Exchange currently charges $0.0009 per 
share (or 0.30% of the total dollar value of the transaction for 
securities priced below $1.00) to Members for executions on IEX that 
provide or take resting interest with non-displayed priority (i.e., an 
order or portion of a reserve order that is booked and ranked with non-
displayed priority on the Order Book).\8\ The Exchange does not charge 
any fee to Members for executions on IEX when the adding and removing 
order originated from the same Exchange Member.\9\
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    \7\ This pricing is referred to by the Exchange as ``Displayed 
Match Fee'' with a Fee Code of `L' provided by the Exchange on 
execution reports. See the Investors Exchange Fee Schedule, 
available on the Exchange public website.
    \8\ This pricing is referred to by the Exchange as ``Non-
Displayed Match Fee'' with a Fee Code of `I' provided by the 
Exchange on execution reports. See the Investors Exchange Fee 
Schedule, available on the Exchange public website.
    \9\ This pricing is referred to by the Exchange as 
``Internalization Fee'' with a Fee Code of `S' provided by the 
Exchange on execution reports. Orders from different market 
participant identifiers of the same broker dealer, with the same 
Central Registration Depository registration number, are treated as 
originating from the same Exchange Member. See the Investors 
Exchange Fee Schedule, available on the Exchange public website.
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    After informal discussions with various Members, the Exchange 
recognizes that some Members may be dissuaded from seeking to access 
IEX quotations at the NBBO due to the variability in execution fees 
when routing orders to the Exchange that are executable at the far side 
of the NBBO and intended to trade against the Exchange's displayed 
quotation, but inadvertently remove non-displayed liquidity resting at 
or within the spread. While such spread-crossing orders would receive 
price improvement equal to the delta between the execution price and 
the far side quotation (i.e., the difference between the trade price 
and the NBO (NBB) for buy (sell) orders),\10\ the potential for 
interacting with non-displayed liquidity resting within the spread, and 
therefore being assessed the Non-Displayed Match Fee of $0.0009 versus 
the Displayed Match Fee of $0.0003, makes it difficult for Members to 
estimate access fees on a pre-trade basis, which the Exchange believes 
thereby presents difficulties for some Members when determining which 
venues to route marketable orders to.\11\
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    \10\ The Exchange notes that when handling client orders as 
agent, IEX Members must ensure they are satisfying their duty of 
best execution, which requires that in any transaction for or with a 
customer or a customer of another broker-dealer, a member and 
persons associated with a member shall use reasonable diligence to 
ascertain the best market for the subject security and buy or sell 
in such market so that the resultant price to the customer is as 
favorable as possible under prevailing market conditions. Members 
must also conduct regular and rigorous reviews of execution quality 
in order to determine which market center to route customer orders, 
and should explicitly consider the extent to which an order may 
obtain price improvement at other venues. See FINRA Rule 5310, 
including Supplementary Material .09 thereto.
    \11\ The Exchange notes that FINRA has released guidance 
clarifying that firms should not allow access fees charged by venues 
to inappropriately affect their routing decisions, and, in general, 
a firm's routing decisions should not be unduly influenced by a 
particular venue's fee or rebate structure. See FINRA Regulatory 
Notice 15-46 (November 2015) at 6.
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    In order to reduce the variability in fees to access liquidity on 
the Exchange and thereby incentivize Members to route more orders to 
the Exchange that are executable at the far side of the NBBO, the 
Exchange is proposing to offer a more deterministic Spread-Crossing 
Remove Fee of $0.0003 per share to all executions at or above $1.00 
that result from removing liquidity with a buy (sell) order that is 
executable at the NBO (NBB). Consistent with the Exchange's existing 
Fee Schedule, executions below $1.00 will be 0.30% of the total dollar 
value of the transaction. Members will receive a Fee Code of ``N'' on 
execution reports provided by the Exchange for transactions that 
receive the Spread-Crossing Remove Fee.\12\
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    \12\ Pursuant to the Exchange's existing Fee Schedule, a Fee 
Code of ``N'' applies to executions that are part of an IPO Auction. 
Accordingly, the Exchange is proposing to replace the Fee Code for 
executions in an IPO Auction with a Fee Code of ``P''.
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    The Exchange believes that incentivizing additional spread-crossing 
interest by offering the proposed Spread-Crossing Remove Fee will 
enhance public price discovery and overall execution quality on the 
Exchange in several ways. First, as described above, to the extent 
spread-crossing interest removes non-displayed liquidity within the 
spread, the spread-crossing orders will receive price improvement equal 
to the delta between the execution price and the far side quotation, 
while the non-displayed resting interest will have received the benefit 
of trading passively and also capturing the spread in part. Similarly, 
to the extent spread-crossing interest removes displayed liquidity 
resting at the NBBO, such resting displayed liquidity will have 
increased opportunities to capture the full spread. If market makers 
and other Members are more frequently capturing the spread when resting 
displayed orders on the Exchange, such Members may be incentivized to 
enter additional aggressively priced displayed orders on the Exchange, 
thereby contributing to public price discovery, consistent with the 
overall goal of enhancing market quality.
    Pursuant to Rules 11.190(a)(1)-(3), the Exchange offers three 
general order types--market orders, limit orders, and pegged orders--
each of which have distinct functional behaviors, and are further 
controlled by various User-defined order parameters that dictate 
additional functional behaviors of the order within the Exchange's 
System.\13\ Orders entered on the Exchange are eligible to remove 
liquidity on entry pursuant to the distinct behavior of the User-
selected order type and order parameters. In addition, non-displayed 
orders that are resting on the Order Book and eligible to trade at 
least as aggressively as the Midpoint Price are eligible to remove 
liquidity on Order Execution Recheck, or ``Book Recheck'', pursuant to 
Rule 11.230(a)(4)(d). Book Recheck is a process within the IEX System 
that detects new trading opportunities for resting orders upon a change 
to the Order Book, the NBBO, or as part of processing inbound messages, 
resulting in an invitation for non-displayed orders to attempt to 
remove liquidity from the contra side.\14\
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    \13\ See Rule 11.190(b) (Order Parameters) for a full 
description of the available order parameters.
    \14\ See Rule 11.230(a)(4)(d), which provides a complete 
description of Book Recheck.
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    Pursuant the Exchange's Rules, in addition to the terms of each 
order type and order parameter, every order is subject to various legal 
and technical constraints that are designed to optimize order 
interactions within the System, and to comply with the Act and the 
rules and regulations thereunder. Rule

[[Page 20120]]

11.190(f)(1)(Order Collars) describes the IEX Order Collar, which 
prevents any incoming order or order resting on the Order Book, 
including those marked ISO, from executing at a price outside of the 
Order Collar price range (i.e., prevents buy orders from trading at 
prices above the collar and prevents sell orders from trading at prices 
below the collar).\15\ Furthermore, Rule 11.190(h)(Price Sliding) 
describes the Exchange's price sliding processes that are designed to 
ensure compliance with Regulation NMS (including the Plan to Address 
Extraordinary Market Volatility pursuant to Rule 608 thereunder (the 
``LULD Plan''),\16\ as well as Rule 201 of Regulation SHO.\17\
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    \15\ The Order Collar price range is calculated by applying the 
numerical guidelines for clearly erroneous executions to the ``Order 
Collar Reference Price'', which is defined as the most current of 
(i) the last sale price disseminated during the Regular Market 
Session on the current trade date; (ii) last trade price 
disseminated outside of the Regular Market Session (Form T, as 
communicated by the relevant SIP) on trade date which other than for 
the Form T designation would have been considered a valid last sale 
price; or (iii) if neither of the prices above are available, the 
prior days Official Closing Price from the listing exchange, 
adjusted to account for corporate actions, news events, etc. In the 
event there is no valid Order Collar Reference Price or Router 
Constraint Reference Price, the Exchange generally rejects orders 
for the security.
    \16\ See Securities Exchange Act Release No. 67091 (May 31, 
2012), 77 FR 33498 (June 6, 2012). Note, unless otherwise specified, 
capitalized terms used in reference to the LULD Plan have the same 
meaning as set forth in the LULD Plan or in Exchange rules. See also 
Rule 11.280(e)(Limit Up-Limit Down Mechanism), which sets forth the 
Exchange's methodology for re-pricing and canceling interest 
pursuant to the LULD Plan.
    \17\ 17 CFR 242.201. See also Rule 11.190(h)(4)(Short Sale Price 
Sliding).
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    If an order--based on market conditions, User instructions, 
applicable IEX Rules and/or the Act and the rules and regulations 
thereunder--is not executable at the far side of the NBBO, such order 
will not be eligible for the Spread-Crossing Remove Fee. Specifically, 
for a buy (sell) order to be deemed ``executable'' at the NBO (NBB), in 
the case of a market order, the applicable IEX Order Collar and the 
price of the Upper (Lower) LULD Price Band, as well as the result of 
any other price sliding necessary pursuant to Rule 11.190(h), must be 
marketable to the NBO (NBB) upon entry, because market orders, despite 
not having a maximum (minimum) price at which the User is willing to 
buy (sell), remain constrained by the least aggressive of the IEX Order 
Collar and the LULD Price Band, as well as the result of any other 
price sliding necessary pursuant to Rule 11.190(h). For example, in a 
Tier 1 security, if the NBBO is $10.10 by $10.20, the IEX Order Collar 
is $9.13 by $11.16, and the LULD Price Band is $9.64 by $10.65, a 
market order to buy (sell) that removes liquidity from the Order Book 
(against either displayed or non-displayed liquidity on the Order Book) 
will receive the Spread-Crossing Remove Fee, because the Upper (Lower) 
LULD Price Band of $10.65 ($9.64) (which is less aggressive than the 
IEX Order Collar, and therefore controlling), is marketable to the NBO 
(NBB) of $10.20 ($10.10).
    In the case of a limit order, the User-defined and System-adjusted 
limit price (i.e., the price at which the order is eligible to execute 
after accounting for the User-defined limit price, the IEX Order 
Collar, and the LULD Price Band, as well as the result of any other 
price sliding necessary pursuant to Rule 11.190(h)) must be executable 
at the NBO (NBB) upon entry, or on Book Recheck. For example, in a Tier 
1 security, if the NBBO is $10.10 by $10.20, the IEX Order Collar is 
$9.13 by $11.16, and the LULD Price Band is $9.64 by $10.65, a limit 
order to buy with a limit price of $10.20 that removes liquidity from 
the Order Book (against either displayed or non-displayed liquidity on 
the Order Book) will receive the Spread-Crossing Remove Fee, because 
the User-defined limit price is marketable to the NBO, and less 
aggressive than the IEX Order Collar and the LULD Price Band, and does 
not otherwise necessitate additional price sliding pursuant to Rule 
11.190(h)(4).
    As a general matter, pegged orders do not qualify for the Spread-
Crossing Remove Fee, because such orders, by their terms, are 
explicitly designed to capture the spread in full or in part by 
executing at prices that are equal to or more passive than the Midpoint 
Price. However, pursuant to Rule 11.190(h)(3)(C)(i), in the event the 
market becomes locked (i.e., the price of the NBB is equal to the price 
of NBO), the Exchange considers the Midpoint Price to be equal to the 
locking price. Therefore, in a locked market, Midpoint Peg \18\ and 
Discretionary Peg \19\ orders that remove liquidity at the locking 
price on entry or on Book Recheck will receive the Spread-Crossing 
Remove Fee. For example, if the NBBO is locked at $10.10 by $10.10, a 
Midpoint Peg order to buy (sell) that removes liquidity at $10.10 will 
receive the Spread-Crossing Remove Fee. In contrast, Primary Peg orders 
are never eligible to remove liquidity, and therefore will never 
receive the Spread-Crossing Remove Fee.\20\
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    \18\ Pursuant to Rule 11.190(b)(9), upon entry and on Book 
Recheck, Midpoint Peg orders attempt to remove all available 
liquidity at the less aggressive of the Midpoint Price or the orders 
limit price, if any.
    \19\ Pursuant to Rule 11.190(b)(10), upon entry and on Book 
Recheck, Discretionary Peg orders attempt to remove all available 
liquidity at the less aggressive of the Midpoint Price or the orders 
limit price, if any.
    \20\ Pursuant to Rule 11.190(b)(8), upon entry, Primary Peg 
orders attempt to remove liquidity at the less aggressive of one (1) 
MPV less aggressive than the NBB (NBO) for buy (sell) orders or the 
orders limit price, if any. Therefore, because the System will not 
generate an internally locked or crossed book (as a result of 
execution and price sliding logic, including the Exchange's price 
sliding processes for non-displayed orders (the ``Midpoint Price 
Constraint''), which restricts non-displayed orders from resting on 
the Order Book at a price more aggressive than the midpoint of the 
NBBO, Primary Peg orders Primary Peg orders are never eligible to 
remove liquidity. Accordingly, Primary Peg orders are not eligible 
for Book Recheck.
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    Similarly, when a short sale price test restriction \21\ is in 
effect, short sale orders not marked short exempt that are priced at or 
more aggressive than the NBB are subject to the short sale price 
sliding process pursuant to Rule 11.190(h)(4) and are therefore never 
executable at or below the NBB. Accordingly, when a short sale price 
test restriction is in effect, short sale orders not marked short 
exempt that are priced to execute at or below the NBB will not receive 
the Spread-Crossing Remove Fee. For example, for a security subject to 
the short sale price test restriction, if the NBBO is $10.10 by $10.20, 
and IEX receives a non-displayed short sale limit order not marked 
short exempt with a limit price of $10.10, such order is ineligible for 
execution at its limit price pursuant to Rule 11.190(h)(4)(B), would 
only be executable above the current NBB upon entry or on Book Recheck, 
and would otherwise be repriced and ranked by the System on the Order 
Book non-displayed pursuant to the Midpoint Price Constraint at the 
current Midpoint Price.\22\ Accordingly, such order is never executable 
at the NBB, and therefore would not receive the Spread-Crossing Remove 
Fee.
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    \21\ Generally, if the current NBB for a covered security 
decreased by 10% or more from the security's closing price as 
determined by the listing market, Rule 201 of Regulation SHO 
prohibits the execution or display of a short sale order not marked 
short exempt at a price that is less than or equal to the NBB. See 
17 CFR 242.201.
    \22\ To continue to this example, if the Exchange has non-
displayed liquidity to buy resting on the Order Book at $10.11, a 
short sale order not marked short exempt would be eligible to remove 
such interest upon entry (or, if such interest was entered after the 
short sale order, on Book Recheck), but would not receive the 
Spread-Crossing Remove Fee, because such order is not executable at 
the NBB.
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    Finally, in the case of a crossed market (i.e., when the price of 
the NBB is higher than the NBO), all removers of liquidity will receive 
the Spread-Crossing Remove Fee. For example, if the NBBO is crossed at 
$10.13 by

[[Page 20121]]

$10.10, and IEX has a displayed offer at $10.10, a limit order to buy 
with a limit price of $10.10 or higher that removes liquidity will 
receive the Spread-Crossing Remove Fee. While the Exchange believes the 
arbitrage opportunity provides a natural incentive for market 
participants to resolve the crossing quotation, the Exchange intends to 
further incentivize such market improving behavior by charging such 
removers the proposed Spread-Crossing Remove Fee.
    The Exchange notes that executions subject to the Crumbling Quote 
Remove Fee are not eligible for the Spread-Crossing Remove Fee.\23\ 
Accordingly, transactions that are subject to the Crumbling Quote 
Remove Fee that remove liquidity with an order executable at the far 
side of the NBBO will be charged the Crumbling Quote Remove Fee, rather 
than the Spread-Crossing Remove Fee. Furthermore, the Exchange is not 
proposing any change to the Internalization Fee whereby no fee is 
charged for executions when the adding and removing order originated 
from the same Exchange Member. Thus, transactions that qualify for the 
Internalization Fee and the proposed Spread-Crossing Remove Fee will be 
charged the Internalization Fee rather than the Spread-Crossing Remove 
Fee, since the IEX Fee Schedule provides that to the extent a Member 
receives multiple Fee Codes on an execution, the lower fee shall 
apply.\24\
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    \23\ See Fee Code Q (Crumbling Quote Remove Fee Indicator), 
along with the footnote appurtenant thereto in the Investors 
Exchange Fee Schedule, available on the Exchange public website, 
which together describe the applicable fee for executions that take 
liquidity during periods of quote instability as defined in Rule 
11.190(g) that exceed the CQRF Threshold, which is equal to is equal 
to 5% of the sum of a Member's total monthly executions on IEX if at 
least 1,000,000 shares during the calendar month, measured on an 
MPID basis. See also Securities and Exchange Act Release No. 81484 
(August 25, 2017) 82 FR 41446 (August 31, 2017) (SR-IEX-2017-27). 
See also footnote three under Transaction Fees in the Investors 
Exchange Fee Schedule, which specifies that, except for the 
Crumbling Quote Remove Fee Code of Q, to the extent a Member 
receives multiple Fee Codes on an execution, the lower fee shall 
apply.
    \24\ See footnote three under Transaction Fees in the Investors 
Exchange Fee Schedule, which specifies that, except for the 
Crumbling Quote Remove Fee Code of Q, to the extent a Member 
receives multiple Fee Codes on an execution, the lower fee shall 
apply.
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2. Statutory Basis
    IEX believes that the proposed rule change is consistent with the 
provisions of Section 6(b) \25\ of the Act in general, and furthers the 
objectives of Sections 6(b)(4) \26\ of the Act, in particular, in that 
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 believes that the proposed fee change is 
reasonable, fair and equitable, and non-discriminatory. The Exchange 
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.
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    \25\ 15 U.S.C. 78f.
    \26\ 15 U.S.C. 78f(b)(4).
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    As proposed, the Spread-Crossing Remove Fee is designed to reduce 
the variability in fees to access liquidity on the Exchange, therefore 
making the Exchange's Fee Schedule more clear and predictable to the 
benefit of all market participants. Furthermore, as discussed in the 
Purpose section, the Exchange believes that to the extent the proposed 
Spread-Crossing Remove Fee incentivizes additional spread-crossing 
orders on the Exchange, resting displayed interest will have enhanced 
opportunities to capture the spread, which may result in additional 
aggressively priced orders being entered on the Exchange, thereby 
contributing to public price discovery, consistent with the overall 
goal of enhancing market quality.
    The Exchange does not believe that the proposed change represents a 
significant departure from pricing currently offered by the Exchange. 
As described in the Purpose section, the proposed Spread-Crossing 
Remove Fee is equal to the Displayed Match Fee, and less than the Non-
Displayed Match Fee, thus falling within the range of transaction fees 
currently charged by the Exchange. Furthermore, the proposed Spread-
Crossing Remove Fee is substantially lower than the fee for removing 
liquidity on competing exchanges with a ``maker-taker'' fee structure 
(i.e., that provide a rebate to liquidity adders and charge liquidity 
removers).\27\
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    \27\ See, e.g., the New York Stock Exchange (``NYSE'') trading 
fee schedule on its public website reflects fees to ``take'' 
liquidity ranging from $0.0024-$0.0030 depending on the type of 
market participant, order and execution; the Nasdaq Stock Market 
(``Nasdaq'') trading fee schedule on its public website reflects 
fees to ``remove'' liquidity ranging from $0.0025-$0.0030 per share 
for shares executed in continuous trading at or above $1.00 or 0.30% 
of total dollar volume for shares executed below $1.00; the Cboe BZX 
Exchange (``Cboe BZX'') trading fee schedule on its public website 
reflects fees for ``removing'' liquidity ranging from $0.0025-
$0.0030, for shares executed in continuous trading at or above $1.00 
or 0.30% of total dollar volume for shares executed below $1.00.
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    As proposed, Members that remove non-displayed liquidity on the 
Exchange will be charged disparate fees depending on whether or not the 
removing order was executable at the far side of the NBBO. For example, 
a limit order with a User-defined and system-adjusted limit price that 
is marketable to the Midpoint Price that removes non-displayed 
liquidity at the Midpoint Price will be charged the Non-Displayed Match 
Fee, whereas a limit order with a User-defined and system-adjusted 
limit price that is executable at the far side of the NBBO that removes 
non-displayed liquidity at the Midpoint Price will be charged the 
Spread-Crossing Remove Fee. The Exchange believes it is reasonable, 
equitable and not unfairly discriminatory to charge disparate fees for 
removing liquidity on the Exchange depending on whether or not the 
removing order was executable at the far side of the NBBO, because 
spread-crossing orders are willing to interact with the Exchange's 
resting displayed orders, thereby potentially incentivizing Members to 
enter more aggressively priced displayed orders by enhancing 
opportunities for such orders to capture the full spread.
    The Exchange believes incentivizing market makers and other Members 
to enter more aggressively priced displayed orders on the Exchange by 
enhancing trading opportunities at the NBBO significantly contributes 
to public price discovery, consistent with the overall goal of 
enhancing market quality. Furthermore, removers of non-displayed 
liquidity that are not willing to cross the spread are receiving the 
benefit of trading more passively and receiving price improvement, 
which the Exchange believes is a substantial incentive and benefit in 
and of itself.\28\ Similarly, non-displayed orders resting on the 
Exchange are receiving the benefit of resting passively on the Order 
Book and capturing the spread in whole or in part. Therefore, the 
Exchange believes it is reasonable, equitable and not unfairly 
discriminatory to charge Members that add non-displayed liquidity a 
different fee then Members that remove non-displayed liquidity with an 
order that is executable at the far side of the NBBO.\29\
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    \28\ The Exchange notes the spread-crossing removers may also 
receive such price improvement to the extent they remove non-
displayed liquidity resting within the spread. However, such price 
improvement is not guaranteed, and spread-crossing removers 
consciously choose to pay the full spread with only the possibility 
of price improvement.
    \29\ The Exchange also notes that it is common for Exchange's to 
charge Members different fees for adding and removing liquidity, and 
thus the Exchange's proposal is not novel in this regard. See, e.g., 
the New York Stock Exchange (``NYSE'') trading fee schedule on its 
public website which reflects fees to ``take'' liquidity ranging 
from $0.0024-$0.0030 depending on the type of market participant, 
order and execution. Additionally, NYSE fees to ``add'' liquidity 
range from $0.0018-$0.0030 per share for shares executed in 
continuous trading; [sic]

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[[Page 20122]]

    The Exchange also believes that it is reasonable, fair and 
equitable, and non-discriminatory to not offer the proposed Spread-
Crossing Remove Fee to orders that are subject to the Crumbling Quote 
Remove Fee because such executions are necessarily a part of a trading 
strategy that the Exchange believes evidences a form of predatory 
latency arbitrage that leverages low latency proprietary market data 
feeds and connectivity along with predictive models to chase short-term 
price momentum and successfully target resting orders at unstable 
prices. Furthermore, if the Exchange were to apply the Spread-Crossing 
Remove Fee to executions that are subject to the Crumbling Quote Remove 
Fee, it would frustrate its fundamental purpose of disincentivizing 
predatory trading strategies to further incentivize additional resting 
liquidity, including displayed liquidity, on IEX. Thus, a Member that 
removes liquidity with spread-crossing orders that are subject to the 
Crumbling Quote Remove Fee, should not be afforded the benefit of the 
proposed Spread-Crossing Remove Fee on such executions.
    The Exchange also notes that the Crumbling Quote Remove Fee, in 
combination with the proposed Spread-Crossing Remove Fee, is designed 
to incentivize spread-crossing interest that is not part of what the 
Exchange believes is a predatory trading strategy, therefore 
potentially increasing the entry of orders executable at the far side 
of the NBBO during periods of relative market stability. If the Spread-
Crossing Remove Fee is successful in this regard, the opportunity for 
execution and the resultant execution performance for non-displayed 
resting orders within the spread, as well as displayed orders resting 
at the NBBO, would be significantly enhanced. Consequently, enhanced 
trading opportunities may incentivize the entry of non-displayed orders 
resting at or within the spread, as well as displayed order resting at 
the NBBO, thereby contributing to the post-trade and pre-trade public 
price discovery process, respectively. Accordingly, the Exchange 
believes that the Crumbling Quote Remove Fee, in combination with the 
proposed Spread-Crossing Remove Fee, is reasonable, fair and equitable, 
and non-discriminatory.
    Additionally, the Exchange believes that it is reasonable, fair and 
equitable, and non-discriminatory to continue to charge the 
Internalization Fee rather than the Spread-Crossing Remove Fee when the 
adding and removing order originated from the same Exchange Member. IEX 
believes that the same factors that support not charging fees for such 
transactions, as described in its rule filing adopting this fee 
structure, continue to be relevant.\30\ Specifically, not charging a 
fee is designed to incentivize Members (and their customers) to send 
orders to IEX that may otherwise be internalized off exchange, with the 
goal of increasing order interaction on IEX. Internalization on IEX is 
not guaranteed, and the additional order flow that does not internalize 
is available to trade by all Members.
---------------------------------------------------------------------------

    \30\ See Securities Exchange Act Release No. 78550 (August 11, 
2016), 81 FR 54873 (August 17, 2016) (SR-IEX-2016-09).
---------------------------------------------------------------------------

    Finally, the Exchange believes that the proposed fees are 
nondiscriminatory because they will apply uniformly to all Members.

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

    IEX does not believe that the proposed rule change will result in 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange does not believe 
that the proposed rule change will impose any burden on intermarket 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. The Exchange operates in a highly competitive 
market in which market participants can readily favor competing venues 
if fee schedules at other venues are viewed as more favorable. 
Consequently, the Exchange believes that the degree to which IEX fees 
could impose any burden on competition is extremely limited and does 
not believe that such fees would burden competition between Members or 
competing venues in a manner that is not necessary or appropriate in 
furtherance of the purposes of the Act. Moreover, as noted in the 
Statutory Basis section, the Exchange does not believe that the 
proposed changes represent a significant departure from its current fee 
structure, and competing venues are able to adopt comparable pricing.
    The Exchange does not believe that the proposed rule change will 
impose any burden on intramarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act because, while 
different fees are assessed in some circumstances, these different fees 
are not based on the type of Member entering the orders that match but 
on the type of order entered and the market conditions in which such 
order was entered. Moreover, the proposed Spread-Crossing Remove Fee 
will apply equally to all Members that remove liquidity with an order 
executable at the far side of the NBBO. The Exchange notes that all 
Members can submit any of the Exchange's approved order types and order 
parameters, including orders that are executable at the far side of the 
NBBO. Further, the proposed fee changes continue to be intended to 
encourage market participants to bring increased order flow to the 
Exchange, which benefits all market participants.

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

    Written comments were neither solicited nor received.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) \31\ of the Act.
---------------------------------------------------------------------------

    \31\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \32\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \32\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File No. SR-IEX-2018-09 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange

[[Page 20123]]

Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File No. SR-IEX-2018-09. 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 No. SR-IEX-2018-09, and should be submitted on or 
before May 29, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\33\
---------------------------------------------------------------------------

    \33\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-09577 Filed 5-4-18; 8:45 am]
 BILLING CODE 8011-01-P

20118 Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Notices 5745.41 This proposed rule change is Commission process and review your ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 consistent with those filings and raises comments more efficiently, please use notice is hereby given that, on April 20, no novel issues. The Shares will be only one method. The Commission will 2018, the Investors Exchange LLC purchased and sold in the secondary post all comments on the Commission’s (‘‘IEX’’ or the ‘‘Exchange’’) filed with the market at prices directly linked to the internet website (http://www.sec.gov/ Securities and Exchange Commission Fund’s next-determined NAV using the rules/sro.shtml). Copies of the (the ‘‘Commission’’) the proposed rule trading protocol called ‘‘NAV-Based submission, all subsequent change as described in Items I, II and III Trading,’’ and the Fund’s permitted amendments, all written statements below, which Items have been prepared investments will be consistent with with respect to the proposed rule by the self-regulatory organization. The those approved in prior filings. change that are filed with the Commission is publishing this notice to Accordingly, the Commission believes Commission, and all written solicit comments on the proposed rule that waiver of the 30-day operative communications relating to the change from interested persons. delay is consistent with the protection proposed rule change between the of investors and the public interest and Commission and any person, other than I. Self-Regulatory Organization’s hereby waives the operative delay and those that may be withheld from the Statement of the Terms of Substance of designates the proposed rule change public in accordance with the the Proposed Rule Change operative upon filing.42 provisions of 5 U.S.C. 552, will be At any time within 60 days of the available for website viewing and Pursuant to the provisions of Section filing of the proposed rule change, the printing in the Commission’s Public 19(b)(1) under the Securities Exchange Commission summarily may Reference Room, 100 F Street NE, Act of 1934 (‘‘Act’’),4 and Rule 19b–4 temporarily suspend such rule change if Washington, DC 20549 on official thereunder,5 Investors Exchange LLC it appears to the Commission that such business days between the hours of (‘‘IEX’’ or ‘‘Exchange’’) is filing with the action is necessary or appropriate in the 10:00 a.m. and 3:00 p.m. Copies of the Securities and Exchange Commission public interest, for the protection of filing also will be available for (‘‘Commission’’) a proposed rule change investors, or otherwise in furtherance of inspection and copying at the principal to modify its Fee Schedule, pursuant to the purposes of the Act. office of the Exchange. All comments IEX Rule 15.110(a) and (c), to charge a IV. Solicitation of Comments received will be posted without change. more deterministic fee of $0.0003 per Persons submitting comments are share for executions at or above $1.00 Interested persons are invited to cautioned that we do not redact or edit that result from removing liquidity with submit written data, views, and personal identifying information from an order that is executable at the far side arguments concerning the foregoing, comment submissions. You should including whether the proposed rule of the NBBO 6 (the ‘‘Spread-Crossing submit only information that you wish Remove Fee’’). Consistent with the change is consistent with the Act. to make available publicly. All Comments may be submitted by any of Exchange’s existing Fee Schedule, submissions should refer to File executions below $1.00 will be 0.30% of the following methods: Number SR–NASDAQ–2018–032, and the total dollar value of the transaction. Electronic Comments should be submitted on or before May Changes to the Fee Schedule pursuant 29, 2018. • Use the Commission’s internet to this proposal are effective upon filing comment form (http://www.sec.gov/ For the Commission, by the Division of and will be operative on May 1, 2018. Trading and Markets, pursuant to delegated rules/sro.shtml); or The text of the proposed rule change authority.43 • Send an email to rule-comments@ is available at the Exchange’s website at sec.gov. Please include File Number SR– Eduardo A. Aleman, Assistant Secretary. www.iextrading.com, at the principal NASDAQ–2018–032 on the subject line. office of the Exchange, and at the [FR Doc. 2018–09572 Filed 5–4–18; 8:45 am] Paper Comments Commission’s Public Reference Room. BILLING CODE 8011–01–P • Send paper comments in triplicate II. Self-Regulatory Organization’s to Secretary, Securities and Exchange Statement of the Purpose of, and Commission, 100 F Street NE, SECURITIES AND EXCHANGE Statutory Basis for, the Proposed Rule Washington, DC 20549–1090. COMMISSION Change All submissions should refer to File [Release No. 34–83147; File No. SR–IEX– Number SR–NASDAQ–2018–032. This In its filing with the Commission, the 2018–09] file number should be included on the self-regulatory organization included subject line if email is used. To help the Self-Regulatory Organizations; statements concerning the purpose of Investors Exchange LLC; Notice of and basis for the proposed rule change 41 See, e.g., Securities Exchange Act Release Nos. Filing and Immediate Effectiveness of and discussed any comments it received 82730 (Feb. 16, 2018), 83 FR 8118 (Feb. 23, 2018) Proposed Rule Change To Modify its on the proposed rule change. The text (SR–NASDAQ–2017–131) (Order Granting Approval of a Proposed Rule Change To List and Fee Schedule To Charge a More of these statement may be examined at Trade the Shares of the Reinhart Intermediate Bond Deterministic Fee of $0.0003 Per Share the places specified in Item IV below. NextShares Fund Under Nasdaq Rule 5745) and for Executions at or Above $1.00 That The self-regulatory organization has 82564 (Jan. 22, 2018), 83 FR 3842 (Jan. 26, 2018) Result From Removing Liquidity With prepared summaries, set forth in (SR–NASDAQ–2017–123) (Order Granting Approval of a Proposed Rule Change, as Modified an Order That is Executable at the Far Sections A, B, and C below, of the most Side of the NBBO daltland on DSKBBV9HB2PROD with NOTICES by Amendment No. 1, To List and Trade Shares of significant aspects of such statements. the Causeway International Value NextSharesTM and the Causeway Global Value NextSharesTM May 1, 2018. 2 15 Under Nasdaq Rule 5745). U.S.C. 78a. Pursuant to Section 19(b)(1) 1 of the 3 17 CFR 240.19b–4. 42 For purposes only of waiving the 30-day Securities Exchange Act of 1934 (the 4 15 U.S.C. 78s(b)(1). operative delay, the Commission also has 5 17 CFR 240.19b–4. considered the proposed rule’s impact on 43 17 CFR 200.30–3(a)(12). efficiency, competition, and capital formation. See 6 As defined by Regulation NMS Rule 600(b)(42). 15 U.S.C. 78c(f). 1 15 U.S.C. 78s(b)(1). 17 CFR 242.600. VerDate Sep<11>2014 17:38 May 04, 2018 Jkt 244001 PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 E:\FR\FM\07MYN1.SGM 07MYN1

Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Notices 20119 A. Self-Regulatory Organization’s inadvertently remove non-displayed enhance public price discovery and Statement of the Purpose of, and the liquidity resting at or within the spread. overall execution quality on the Statutory Basis for, the Proposed Rule While such spread-crossing orders Exchange in several ways. First, as Change would receive price improvement equal described above, to the extent spread- to the delta between the execution price crossing interest removes non-displayed 1. Purpose and the far side quotation (i.e., the liquidity within the spread, the spread- The Exchange proposes to modify its difference between the trade price and crossing orders will receive price Fee Schedule, pursuant to IEX Rule the NBO (NBB) for buy (sell) orders),10 improvement equal to the delta between 15.110(a) and (c), to charge a more the potential for interacting with non- the execution price and the far side deterministic fee of $0.0003 per share displayed liquidity resting within the quotation, while the non-displayed for executions at or above $1.00 that spread, and therefore being assessed the resting interest will have received the result from removing liquidity with an Non-Displayed Match Fee of $0.0009 benefit of trading passively and also order that is executable at the far side versus the Displayed Match Fee of capturing the spread in part. Similarly, of the NBBO (i.e., a buy order that is $0.0003, makes it difficult for Members to the extent spread-crossing interest executable at the NBO or higher, or a to estimate access fees on a pre-trade removes displayed liquidity resting at sell order that is executable at the NBB basis, which the Exchange believes the NBBO, such resting displayed or lower). In an effort to incentivize thereby presents difficulties for some liquidity will have increased Members to submit displayed orders to Members when determining which opportunities to capture the full spread. the Exchange, the Exchange currently venues to route marketable orders to.11 If market makers and other Members are charges a fee of $0.0003 per share (or In order to reduce the variability in more frequently capturing the spread 0.30% of the total dollar value of the fees to access liquidity on the Exchange when resting displayed orders on the transaction for securities priced below and thereby incentivize Members to Exchange, such Members may be $1.00) to Members for executions on IEX route more orders to the Exchange that incentivized to enter additional that provide or take resting interest with are executable at the far side of the aggressively priced displayed orders on displayed priority (i.e., an order or NBBO, the Exchange is proposing to the Exchange, thereby contributing to portion of a reserve order that is booked offer a more deterministic Spread- public price discovery, consistent with and ranked with display priority on the Crossing Remove Fee of $0.0003 per the overall goal of enhancing market Order Book).7 Furthermore, the share to all executions at or above $1.00 quality. Exchange currently charges $0.0009 per that result from removing liquidity with Pursuant to Rules 11.190(a)(1)–(3), the share (or 0.30% of the total dollar value a buy (sell) order that is executable at Exchange offers three general order of the transaction for securities priced the NBO (NBB). Consistent with the types—market orders, limit orders, and below $1.00) to Members for executions Exchange’s existing Fee Schedule, pegged orders—each of which have on IEX that provide or take resting executions below $1.00 will be 0.30% of distinct functional behaviors, and are interest with non-displayed priority the total dollar value of the transaction. further controlled by various User- (i.e., an order or portion of a reserve Members will receive a Fee Code of ‘‘N’’ defined order parameters that dictate order that is booked and ranked with on execution reports provided by the additional functional behaviors of the non-displayed priority on the Order Exchange for transactions that receive order within the Exchange’s System.13 Book).8 The Exchange does not charge the Spread-Crossing Remove Fee.12 Orders entered on the Exchange are any fee to Members for executions on The Exchange believes that eligible to remove liquidity on entry IEX when the adding and removing incentivizing additional spread-crossing pursuant to the distinct behavior of the order originated from the same interest by offering the proposed User-selected order type and order Exchange Member.9 Spread-Crossing Remove Fee will parameters. In addition, non-displayed After informal discussions with orders that are resting on the Order 10 The Exchange notes that when handling client various Members, the Exchange Book and eligible to trade at least as orders as agent, IEX Members must ensure they are recognizes that some Members may be satisfying their duty of best execution, which aggressively as the Midpoint Price are dissuaded from seeking to access IEX requires that in any transaction for or with a eligible to remove liquidity on Order quotations at the NBBO due to the customer or a customer of another broker-dealer, a Execution Recheck, or ‘‘Book Recheck’’, variability in execution fees when member and persons associated with a member shall use reasonable diligence to ascertain the best pursuant to Rule 11.230(a)(4)(d). Book routing orders to the Exchange that are market for the subject security and buy or sell in Recheck is a process within the IEX executable at the far side of the NBBO such market so that the resultant price to the System that detects new trading and intended to trade against the customer is as favorable as possible under opportunities for resting orders upon a prevailing market conditions. Members must also Exchange’s displayed quotation, but conduct regular and rigorous reviews of execution change to the Order Book, the NBBO, or quality in order to determine which market center as part of processing inbound messages, 7 This pricing is referred to by the Exchange as to route customer orders, and should explicitly resulting in an invitation for non- ‘‘Displayed Match Fee’’ with a Fee Code of ‘L’ consider the extent to which an order may obtain provided by the Exchange on execution reports. See price improvement at other venues. See FINRA displayed orders to attempt to remove the Investors Exchange Fee Schedule, available on Rule 5310, including Supplementary Material .09 liquidity from the contra side.14 the Exchange public website. thereto. Pursuant the Exchange’s Rules, in 8 This pricing is referred to by the Exchange as 11 The Exchange notes that FINRA has released addition to the terms of each order type ‘‘Non-Displayed Match Fee’’ with a Fee Code of ‘I’ guidance clarifying that firms should not allow and order parameter, every order is provided by the Exchange on execution reports. See access fees charged by venues to inappropriately the Investors Exchange Fee Schedule, available on affect their routing decisions, and, in general, a subject to various legal and technical the Exchange public website. firm’s routing decisions should not be unduly constraints that are designed to optimize daltland on DSKBBV9HB2PROD with NOTICES 9 This pricing is referred to by the Exchange as influenced by a particular venue’s fee or rebate order interactions within the System, ‘‘Internalization Fee’’ with a Fee Code of ‘S’ structure. See FINRA Regulatory Notice 15–46 and to comply with the Act and the provided by the Exchange on execution reports. (November 2015) at 6. Orders from different market participant identifiers 12 Pursuant to the Exchange’s existing Fee rules and regulations thereunder. Rule of the same broker dealer, with the same Central Schedule, a Fee Code of ‘‘N’’ applies to executions 13 See Rule 11.190(b) (Order Parameters) for a full Registration Depository registration number, are that are part of an IPO Auction. Accordingly, the treated as originating from the same Exchange Exchange is proposing to replace the Fee Code for description of the available order parameters. Member. See the Investors Exchange Fee Schedule, executions in an IPO Auction with a Fee Code of 14 See Rule 11.230(a)(4)(d), which provides a available on the Exchange public website. ‘‘P’’. complete description of Book Recheck. VerDate Sep<11>2014 17:38 May 04, 2018 Jkt 244001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\07MYN1.SGM 07MYN1

20120 Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Notices 11.190(f)(1)(Order Collars) describes the market order to buy (sell) that removes Crossing Remove Fee. In contrast, IEX Order Collar, which prevents any liquidity from the Order Book (against Primary Peg orders are never eligible to incoming order or order resting on the either displayed or non-displayed remove liquidity, and therefore will Order Book, including those marked liquidity on the Order Book) will never receive the Spread-Crossing ISO, from executing at a price outside of receive the Spread-Crossing Remove Remove Fee.20 the Order Collar price range (i.e., Fee, because the Upper (Lower) LULD Similarly, when a short sale price test prevents buy orders from trading at Price Band of $10.65 ($9.64) (which is restriction 21 is in effect, short sale prices above the collar and prevents sell less aggressive than the IEX Order orders not marked short exempt that are orders from trading at prices below the Collar, and therefore controlling), is priced at or more aggressive than the collar).15 Furthermore, Rule marketable to the NBO (NBB) of $10.20 NBB are subject to the short sale price 11.190(h)(Price Sliding) describes the ($10.10). sliding process pursuant to Rule Exchange’s price sliding processes that In the case of a limit order, the User- 11.190(h)(4) and are therefore never are designed to ensure compliance with defined and System-adjusted limit price executable at or below the NBB. Regulation NMS (including the Plan to (i.e., the price at which the order is Accordingly, when a short sale price Address Extraordinary Market Volatility eligible to execute after accounting for test restriction is in effect, short sale pursuant to Rule 608 thereunder (the the User-defined limit price, the IEX orders not marked short exempt that are ‘‘LULD Plan’’),16 as well as Rule 201 of Order Collar, and the LULD Price Band, priced to execute at or below the NBB Regulation SHO.17 as well as the result of any other price will not receive the Spread-Crossing If an order—based on market sliding necessary pursuant to Rule Remove Fee. For example, for a security conditions, User instructions, applicable 11.190(h)) must be executable at the subject to the short sale price test IEX Rules and/or the Act and the rules NBO (NBB) upon entry, or on Book restriction, if the NBBO is $10.10 by and regulations thereunder—is not Recheck. For example, in a Tier 1 $10.20, and IEX receives a non- executable at the far side of the NBBO, security, if the NBBO is $10.10 by displayed short sale limit order not such order will not be eligible for the $10.20, the IEX Order Collar is $9.13 by marked short exempt with a limit price Spread-Crossing Remove Fee. $11.16, and the LULD Price Band is of $10.10, such order is ineligible for Specifically, for a buy (sell) order to be $9.64 by $10.65, a limit order to buy execution at its limit price pursuant to deemed ‘‘executable’’ at the NBO (NBB), with a limit price of $10.20 that removes Rule 11.190(h)(4)(B), would only be in the case of a market order, the liquidity from the Order Book (against executable above the current NBB upon applicable IEX Order Collar and the either displayed or non-displayed entry or on Book Recheck, and would price of the Upper (Lower) LULD Price liquidity on the Order Book) will otherwise be repriced and ranked by the Band, as well as the result of any other receive the Spread-Crossing Remove System on the Order Book non- price sliding necessary pursuant to Rule Fee, because the User-defined limit displayed pursuant to the Midpoint 11.190(h), must be marketable to the price is marketable to the NBO, and less Price Constraint at the current Midpoint NBO (NBB) upon entry, because market aggressive than the IEX Order Collar and Price.22 Accordingly, such order is orders, despite not having a maximum the LULD Price Band, and does not never executable at the NBB, and (minimum) price at which the User is otherwise necessitate additional price therefore would not receive the Spread- willing to buy (sell), remain constrained sliding pursuant to Rule 11.190(h)(4). Crossing Remove Fee. by the least aggressive of the IEX Order As a general matter, pegged orders do Finally, in the case of a crossed Collar and the LULD Price Band, as well not qualify for the Spread-Crossing market (i.e., when the price of the NBB as the result of any other price sliding is higher than the NBO), all removers of Remove Fee, because such orders, by necessary pursuant to Rule 11.190(h). liquidity will receive the Spread- their terms, are explicitly designed to For example, in a Tier 1 security, if the Crossing Remove Fee. For example, if capture the spread in full or in part by NBBO is $10.10 by $10.20, the IEX the NBBO is crossed at $10.13 by executing at prices that are equal to or Order Collar is $9.13 by $11.16, and the more passive than the Midpoint Price. LULD Price Band is $9.64 by $10.65, a 20 Pursuant to Rule 11.190(b)(8), upon entry, However, pursuant to Rule Primary Peg orders attempt to remove liquidity at 15 The Order Collar price range is calculated by 11.190(h)(3)(C)(i), in the event the the less aggressive of one (1) MPV less aggressive applying the numerical guidelines for clearly market becomes locked (i.e., the price of than the NBB (NBO) for buy (sell) orders or the erroneous executions to the ‘‘Order Collar Reference the NBB is equal to the price of NBO), orders limit price, if any. Therefore, because the Price’’, which is defined as the most current of (i) the Exchange considers the Midpoint System will not generate an internally locked or the last sale price disseminated during the Regular crossed book (as a result of execution and price Market Session on the current trade date; (ii) last Price to be equal to the locking price. sliding logic, including the Exchange’s price sliding trade price disseminated outside of the Regular Therefore, in a locked market, Midpoint processes for non-displayed orders (the ‘‘Midpoint Market Session (Form T, as communicated by the Peg 18 and Discretionary Peg 19 orders Price Constraint’’), which restricts non-displayed relevant SIP) on trade date which other than for the that remove liquidity at the locking orders from resting on the Order Book at a price Form T designation would have been considered a more aggressive than the midpoint of the NBBO, valid last sale price; or (iii) if neither of the prices price on entry or on Book Recheck will Primary Peg orders Primary Peg orders are never above are available, the prior days Official Closing receive the Spread-Crossing Remove eligible to remove liquidity. Accordingly, Primary Price from the listing exchange, adjusted to account Fee. For example, if the NBBO is locked Peg orders are not eligible for Book Recheck. for corporate actions, news events, etc. In the event at $10.10 by $10.10, a Midpoint Peg 21 Generally, if the current NBB for a covered there is no valid Order Collar Reference Price or security decreased by 10% or more from the Router Constraint Reference Price, the Exchange order to buy (sell) that removes liquidity security’s closing price as determined by the listing generally rejects orders for the security. at $10.10 will receive the Spread- market, Rule 201 of Regulation SHO prohibits the 16 See Securities Exchange Act Release No. 67091 execution or display of a short sale order not (May 31, 2012), 77 FR 33498 (June 6, 2012). Note, 18 Pursuant to Rule 11.190(b)(9), upon entry and marked short exempt at a price that is less than or daltland on DSKBBV9HB2PROD with NOTICES unless otherwise specified, capitalized terms used on Book Recheck, Midpoint Peg orders attempt to equal to the NBB. See 17 CFR 242.201. in reference to the LULD Plan have the same remove all available liquidity at the less aggressive 22 To continue to this example, if the Exchange meaning as set forth in the LULD Plan or in of the Midpoint Price or the orders limit price, if has non-displayed liquidity to buy resting on the Exchange rules. See also Rule 11.280(e)(Limit Up- any. Order Book at $10.11, a short sale order not marked Limit Down Mechanism), which sets forth the 19 Pursuant to Rule 11.190(b)(10), upon entry and short exempt would be eligible to remove such Exchange’s methodology for re-pricing and on Book Recheck, Discretionary Peg orders attempt interest upon entry (or, if such interest was entered canceling interest pursuant to the LULD Plan. to remove all available liquidity at the less after the short sale order, on Book Recheck), but 17 17 CFR 242.201. See also Rule aggressive of the Midpoint Price or the orders limit would not receive the Spread-Crossing Remove Fee, 11.190(h)(4)(Short Sale Price Sliding). price, if any. because such order is not executable at the NBB. VerDate Sep<11>2014 17:38 May 04, 2018 Jkt 244001 PO 00000 Frm 00089 Fmt 4703 Sfmt 4703 E:\FR\FM\07MYN1.SGM 07MYN1

Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Notices 20121 $10.10, and IEX has a displayed offer at equitable allocation of reasonable dues, side of the NBBO. For example, a limit $10.10, a limit order to buy with a limit fees and other charges among its order with a User-defined and system- price of $10.10 or higher that removes Members and other persons using its adjusted limit price that is marketable to liquidity will receive the Spread- facilities. The Exchange believes that the Midpoint Price that removes non- Crossing Remove Fee. While the the proposed fee change is reasonable, displayed liquidity at the Midpoint Exchange believes the arbitrage fair and equitable, and non- Price will be charged the Non-Displayed opportunity provides a natural incentive discriminatory. The Exchange operates Match Fee, whereas a limit order with for market participants to resolve the in a highly competitive market in which a User-defined and system-adjusted crossing quotation, the Exchange market participants can readily direct limit price that is executable at the far intends to further incentivize such order flow to competing venues if they side of the NBBO that removes non- market improving behavior by charging deem fee levels at a particular venue to displayed liquidity at the Midpoint such removers the proposed Spread- be excessive. Price will be charged the Spread- Crossing Remove Fee. As proposed, the Spread-Crossing Crossing Remove Fee. The Exchange The Exchange notes that executions Remove Fee is designed to reduce the believes it is reasonable, equitable and subject to the Crumbling Quote Remove variability in fees to access liquidity on not unfairly discriminatory to charge Fee are not eligible for the Spread- the Exchange, therefore making the disparate fees for removing liquidity on Crossing Remove Fee.23 Accordingly, Exchange’s Fee Schedule more clear and the Exchange depending on whether or transactions that are subject to the predictable to the benefit of all market not the removing order was executable Crumbling Quote Remove Fee that participants. Furthermore, as discussed at the far side of the NBBO, because remove liquidity with an order in the Purpose section, the Exchange spread-crossing orders are willing to executable at the far side of the NBBO believes that to the extent the proposed interact with the Exchange’s resting will be charged the Crumbling Quote Spread-Crossing Remove Fee displayed orders, thereby potentially Remove Fee, rather than the Spread- incentivizes additional spread-crossing incentivizing Members to enter more Crossing Remove Fee. Furthermore, the orders on the Exchange, resting aggressively priced displayed orders by Exchange is not proposing any change displayed interest will have enhanced enhancing opportunities for such orders to the Internalization Fee whereby no opportunities to capture the spread, to capture the full spread. fee is charged for executions when the which may result in additional The Exchange believes incentivizing adding and removing order originated aggressively priced orders being entered market makers and other Members to from the same Exchange Member. Thus, on the Exchange, thereby contributing to enter more aggressively priced transactions that qualify for the public price discovery, consistent with displayed orders on the Exchange by Internalization Fee and the proposed the overall goal of enhancing market enhancing trading opportunities at the Spread-Crossing Remove Fee will be quality. NBBO significantly contributes to charged the Internalization Fee rather The Exchange does not believe that public price discovery, consistent with than the Spread-Crossing Remove Fee, the proposed change represents a the overall goal of enhancing market since the IEX Fee Schedule provides significant departure from pricing quality. Furthermore, removers of non- that to the extent a Member receives currently offered by the Exchange. As displayed liquidity that are not willing multiple Fee Codes on an execution, the described in the Purpose section, the to cross the spread are receiving the lower fee shall apply.24 proposed Spread-Crossing Remove Fee benefit of trading more passively and is equal to the Displayed Match Fee, and receiving price improvement, which the 2. Statutory Basis less than the Non-Displayed Match Fee, Exchange believes is a substantial IEX believes that the proposed rule thus falling within the range of incentive and benefit in and of itself.28 change is consistent with the provisions transaction fees currently charged by the Similarly, non-displayed orders resting of Section 6(b) 25 of the Act in general, Exchange. Furthermore, the proposed on the Exchange are receiving the and furthers the objectives of Sections Spread-Crossing Remove Fee is benefit of resting passively on the Order 6(b)(4) 26 of the Act, in particular, in that substantially lower than the fee for Book and capturing the spread in whole it is designed to provide for the removing liquidity on competing or in part. Therefore, the Exchange exchanges with a ‘‘maker-taker’’ fee believes it is reasonable, equitable and 23 See Fee Code Q (Crumbling Quote Remove Fee structure (i.e., that provide a rebate to not unfairly discriminatory to charge Indicator), along with the footnote appurtenant liquidity adders and charge liquidity thereto in the Investors Exchange Fee Schedule, Members that add non-displayed available on the Exchange public website, which removers).27 liquidity a different fee then Members together describe the applicable fee for executions As proposed, Members that remove that remove non-displayed liquidity that take liquidity during periods of quote non-displayed liquidity on the with an order that is executable at the instability as defined in Rule 11.190(g) that exceed Exchange will be charged disparate fees the CQRF Threshold, which is equal to is equal to far side of the NBBO.29 5% of the sum of a Member’s total monthly depending on whether or not the executions on IEX if at least 1,000,000 shares during removing order was executable at the far 28 The Exchange notes the spread-crossing the calendar month, measured on an MPID basis. removers may also receive such price improvement See also Securities and Exchange Act Release No. 27 See, e.g., the New York Stock Exchange to the extent they remove non-displayed liquidity 81484 (August 25, 2017) 82 FR 41446 (August 31, (‘‘NYSE’’) trading fee schedule on its public website resting within the spread. However, such price 2017) (SR–IEX–2017–27). See also footnote three reflects fees to ‘‘take’’ liquidity ranging from improvement is not guaranteed, and spread- under Transaction Fees in the Investors Exchange $0.0024–$0.0030 depending on the type of market crossing removers consciously choose to pay the Fee Schedule, which specifies that, except for the participant, order and execution; the Nasdaq Stock full spread with only the possibility of price Crumbling Quote Remove Fee Code of Q, to the Market (‘‘Nasdaq’’) trading fee schedule on its improvement. extent a Member receives multiple Fee Codes on an public website reflects fees to ‘‘remove’’ liquidity 29 The Exchange also notes that it is common for execution, the lower fee shall apply. daltland on DSKBBV9HB2PROD with NOTICES ranging from $0.0025–$0.0030 per share for shares Exchange’s to charge Members different fees for 24 See footnote three under Transaction Fees in executed in continuous trading at or above $1.00 or adding and removing liquidity, and thus the the Investors Exchange Fee Schedule, which 0.30% of total dollar volume for shares executed Exchange’s proposal is not novel in this regard. See, specifies that, except for the Crumbling Quote below $1.00; the Cboe BZX Exchange (‘‘Cboe BZX’’) e.g., the New York Stock Exchange (‘‘NYSE’’) Remove Fee Code of Q, to the extent a Member trading fee schedule on its public website reflects trading fee schedule on its public website which receives multiple Fee Codes on an execution, the fees for ‘‘removing’’ liquidity ranging from $0.0025– reflects fees to ‘‘take’’ liquidity ranging from lower fee shall apply. $0.0030, for shares executed in continuous trading $0.0024–$0.0030 depending on the type of market 25 15 U.S.C. 78f. at or above $1.00 or 0.30% of total dollar volume participant, order and execution. Additionally, 26 15 U.S.C. 78f(b)(4). for shares executed below $1.00. Continued VerDate Sep<11>2014 17:38 May 04, 2018 Jkt 244001 PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 E:\FR\FM\07MYN1.SGM 07MYN1

20122 Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Notices The Exchange also believes that it is when the adding and removing order and the market conditions in which reasonable, fair and equitable, and non- originated from the same Exchange such order was entered. Moreover, the discriminatory to not offer the proposed Member. IEX believes that the same proposed Spread-Crossing Remove Fee Spread-Crossing Remove Fee to orders factors that support not charging fees for will apply equally to all Members that that are subject to the Crumbling Quote such transactions, as described in its remove liquidity with an order Remove Fee because such executions rule filing adopting this fee structure, executable at the far side of the NBBO. are necessarily a part of a trading continue to be relevant.30 Specifically, The Exchange notes that all Members strategy that the Exchange believes not charging a fee is designed to can submit any of the Exchange’s evidences a form of predatory latency incentivize Members (and their approved order types and order arbitrage that leverages low latency customers) to send orders to IEX that parameters, including orders that are proprietary market data feeds and may otherwise be internalized off executable at the far side of the NBBO. connectivity along with predictive exchange, with the goal of increasing Further, the proposed fee changes models to chase short-term price order interaction on IEX. Internalization continue to be intended to encourage momentum and successfully target on IEX is not guaranteed, and the market participants to bring increased resting orders at unstable prices. additional order flow that does not order flow to the Exchange, which Furthermore, if the Exchange were to internalize is available to trade by all benefits all market participants. apply the Spread-Crossing Remove Fee Members. to executions that are subject to the Finally, the Exchange believes that C. Self-Regulatory Organization’s Crumbling Quote Remove Fee, it would the proposed fees are nondiscriminatory Statement on Comments on the frustrate its fundamental purpose of because they will apply uniformly to all Proposed Rule Change Received From disincentivizing predatory trading Members. Members, Participants, or Others strategies to further incentivize Written comments were neither additional resting liquidity, including B. Self-Regulatory Organization’s solicited nor received. displayed liquidity, on IEX. Thus, a Statement on Burden on Competition Member that removes liquidity with IEX does not believe that the III. Date of Effectiveness of the spread-crossing orders that are subject proposed rule change will result in any Proposed Rule Change and Timing for to the Crumbling Quote Remove Fee, burden on competition that is not Commission Action should not be afforded the benefit of the necessary or appropriate in furtherance The foregoing rule change has become proposed Spread-Crossing Remove Fee of the purposes of the Act. The effective pursuant to Section on such executions. Exchange does not believe that the 19(b)(3)(A)(ii) 31 of the Act. The Exchange also notes that the proposed rule change will impose any At any time within 60 days of the Crumbling Quote Remove Fee, in burden on intermarket competition that filing of the proposed rule change, the combination with the proposed Spread- is not necessary or appropriate in Commission summarily may Crossing Remove Fee, is designed to furtherance of the purposes of the Act. temporarily suspend such rule change if incentivize spread-crossing interest that The Exchange operates in a highly it appears to the Commission that such is not part of what the Exchange competitive market in which market action is necessary or appropriate in the believes is a predatory trading strategy, participants can readily favor competing public interest, for the protection of therefore potentially increasing the venues if fee schedules at other venues investors, or otherwise in furtherance of entry of orders executable at the far side are viewed as more favorable. the purposes of the Act. If the of the NBBO during periods of relative Consequently, the Exchange believes Commission takes such action, the market stability. If the Spread-Crossing that the degree to which IEX fees could Commission shall institute proceedings Remove Fee is successful in this regard, impose any burden on competition is under Section 19(b)(2)(B) 32 of the Act to the opportunity for execution and the extremely limited and does not believe determine whether the proposed rule resultant execution performance for that such fees would burden change should be approved or non-displayed resting orders within the competition between Members or disapproved. spread, as well as displayed orders competing venues in a manner that is IV. Solicitation of Comments resting at the NBBO, would be not necessary or appropriate in significantly enhanced. Consequently, furtherance of the purposes of the Act. Interested persons are invited to enhanced trading opportunities may Moreover, as noted in the Statutory submit written data, views, and incentivize the entry of non-displayed Basis section, the Exchange does not arguments concerning the foregoing, orders resting at or within the spread, as believe that the proposed changes including whether the proposed rule well as displayed order resting at the represent a significant departure from change is consistent with the Act. NBBO, thereby contributing to the post- its current fee structure, and competing Comments may be submitted by any of trade and pre-trade public price venues are able to adopt comparable the following methods: discovery process, respectively. pricing. Electronic Comments Accordingly, the Exchange believes that The Exchange does not believe that the Crumbling Quote Remove Fee, in the proposed rule change will impose • Use the Commission’s internet combination with the proposed Spread- any burden on intramarket competition comment form (http://www.sec.gov/ Crossing Remove Fee, is reasonable, fair that is not necessary or appropriate in rules/sro.shtml); or and equitable, and non-discriminatory. furtherance of the purposes of the Act • Send an email to rule-comments@ Additionally, the Exchange believes because, while different fees are sec.gov. Please include File No. SR– that it is reasonable, fair and equitable, assessed in some circumstances, these IEX–2018–09 on the subject line. daltland on DSKBBV9HB2PROD with NOTICES and non-discriminatory to continue to different fees are not based on the type Paper Comments charge the Internalization Fee rather of Member entering the orders that than the Spread-Crossing Remove Fee match but on the type of order entered • Send paper comments in triplicate to Secretary, Securities and Exchange NYSE fees to ‘‘add’’ liquidity range from $0.0018– 30 See Securities Exchange Act Release No. 78550 31 15 U.S.C. 78s(b)(3)(A)(ii). $0.0030 per share for shares executed in continuous (August 11, 2016), 81 FR 54873 (August 17, 2016) trading; [sic] (SR–IEX–2016–09). 32 15 U.S.C. 78s(b)(2)(B). VerDate Sep<11>2014 17:38 May 04, 2018 Jkt 244001 PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 E:\FR\FM\07MYN1.SGM 07MYN1

Federal Register / Vol. 83, No. 88 / Monday, May 7, 2018 / Notices 20123 Commission, 100 F Street NE, the Securities and Exchange SECURITIES AND EXCHANGE Washington, DC 20549–1090. Commission (‘‘Commission’’), pursuant COMMISSION All submissions should refer to File No. to Section 19(b)(1) of the Securities SR–IEX–2018–09. This file number Exchange Act of 1934 (‘‘Exchange [Release No. 34–83141; File No. SR–Phlx– should be included on the subject line Act’’) 1 and Rule 19b-4 thereunder,2 a 2018–32] if email is used. To help the proposed rule change to adopt the Route Commission process and review your QCT Cross routing option. The proposed Self-Regulatory Organizations; Nasdaq comments more efficiently, please use rule change was published for comment PHLX LLC; Notice of Filing and only one method. The Commission will in the Federal Register on March 20, Immediate Effectiveness of Proposed post all comments on the Commission’s 2018.3 The Commission has received no Rule Change To Adopt a New Market internet website (http://www.sec.gov/ comment letters on the proposed rule Order Spread Protection rules/sro.shtml). Copies of the change. May 1, 2018. submission, all subsequent amendments, all written statements Section 19(b)(2) of the Act 4 provides Pursuant to Section 19(b)(1) of the with respect to the proposed rule that within 45 days of the publication of Securities Exchange Act of 1934 change that are filed with the notice of the filing of a proposed rule (‘‘Act’’),1 and Rule 19b–4 thereunder,2 Commission, and all written change, or within such longer period up notice is hereby given that on April 20, communications relating to the to 90 days as the Commission may 2018, Nasdaq PHLX LLC (‘‘Phlx’’ or proposed rule change between the designate if it finds such longer period ‘‘Exchange’’) filed with the Securities Commission and any person, other than to be appropriate and publishes its and Exchange Commission those that may be withheld from the reasons for so finding, or as to which the (‘‘Commission’’) the proposed rule public in accordance with the self-regulatory organization consents, change as described in Items I and II provisions of 5 U.S.C. 552, will be the Commission shall either approve the below, which Items have been prepared available for website viewing and proposed rule change, disapprove the by the Exchange. The Commission is printing in the Commission’s Public proposed rule change, or institute publishing this notice to solicit Reference Room, 100 F Street NE, proceedings to determine whether the comments on the proposed rule change Washington, DC 20549, on official from interested persons. proposed rule change should be business days between the hours of disapproved. The 45th day after I. Self-Regulatory Organization’s 10:00 a.m. and 3:00 p.m. Copies of the publication of the notice for this Statement of the Terms of Substance of filing also will be available for proposed rule change is May 4, 2018. the Proposed Rule Change inspection and copying at the principal The Commission is extending this 45- office of the Exchange. All comments The Exchange proposes to adopt a day time period. new Market Order Spread Protection. received will be posted without change. Persons submitting comments are The Commission finds it appropriate The text of the proposed rule change cautioned that we do not redact or edit to designate a longer period within is available on the Exchange’s website at personal identifying information from which to take action on the proposed http://nasdaqphlx.cchwallstreet.com/, comment submissions. You should rule change so that it has sufficient time at the principal office of the Exchange, submit only information that you wish to consider this proposed rule change. and at the Commission’s Public to make available publicly. All Accordingly, the Commission, pursuant Reference Room. submissions should refer to File No. to Section 19(b)(2) of the Act,5 II. Self-Regulatory Organization’s SR–IEX–2018–09, and should be designates June 18, 2018, as the date by Statement of the Purpose of, and submitted on or before May 29, 2018. which the Commission shall either Statutory Basis for, the Proposed Rule For the Commission, by the Division of approve or disapprove, or institute Change Trading and Markets, pursuant to delegated proceedings to determine whether to In its filing with the Commission, the authority.33 disapprove, the proposed rule change Exchange included statements Eduardo A. Aleman, (File No. SR–CHX–2018–001). concerning the purpose of and basis for Assistant Secretary. For the Commission, by the Division of the proposed rule change and discussed [FR Doc. 2018–09577 Filed 5–4–18; 8:45 am] Trading and Markets, pursuant to delegated any comments it received on the BILLING CODE 8011–01–P authority.6 proposed rule change. The text of these Eduardo A. Aleman, statements may be examined at the Assistant Secretary. places specified in Item IV below. The SECURITIES AND EXCHANGE Exchange has prepared summaries, set [FR Doc. 2018–09573 Filed 5–4–18; 8:45 am] COMMISSION forth in sections A, B, and C below, of BILLING CODE 8011–01–P [Release No. 34–83143; File No. SR–CHX– the most significant aspects of such 2018–001] statements. Self-Regulatory Organizations; A. Self-Regulatory Organization’s Chicago Stock Exchange, Inc.; Notice Statement of the Purpose of, and of Designation of a Longer Period on Statutory Basis for, the Proposed Rule Commission Action on a Proposed Change Rule Change To Adopt the Route QCT daltland on DSKBBV9HB2PROD with NOTICES 1. Purpose 1 15 U.S.C. 78s(b)(1). Cross Routing Option 2 17 CFR 240.19b–4. The purpose of this rule change is to May 1, 2018. 3 See Securities Exchange Act Release No. 82870 adopt a new Market Order Spread On March 6, 2018, the Chicago Stock (March 14, 2018), 83 FR 12214. Protection rule similar to The Nasdaq Exchange, Inc. (‘‘Exchange’’) filed with 4 15 U.S.C. 78s(b)(2). 5 Id. 1 15 U.S.C. 78s(b)(1). 33 17 CFR 200.30–3(a)(12). 6 17 CFR 200.30–3(a)(31). 2 17 CFR 240.19b–4. VerDate Sep<11>2014 17:38 May 04, 2018 Jkt 244001 PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 E:\FR\FM\07MYN1.SGM 07MYN1


Document Created: 2018-05-05 02:48:54
Document Modified: 2018-05-05 02:48:54
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 Citation83 FR 20118 
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