83 FR 26726 - Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend and Reorganize Chapter IV of the GEMX Schedule of Fees

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 111 (June 8, 2018)

[Federal Register Volume 83, Number 111 (Friday, June 8, 2018)]
[Notices]
[Pages 26726-26728]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-12321]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83369; File No. SR-GEMX-2018-18]


Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend and 
Reorganize Chapter IV of the GEMX Schedule of Fees

June 4, 2018.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on May 22, 2018, Nasdaq GEMX, LLC (``GEMX'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``Commission'') the proposed 
rule change as described in Items I and II below, which Items have been 
prepared by the Exchange. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend and reorganize Chapter IV of the 
GEMX Schedule of Fees.
    The text of the proposed rule change is available on the Exchange's 
website at http://nasdaqgemx.cchwallstreet.com/, at the principal 
office of the Exchange, and at the Commission's Public Reference Room.

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

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

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

1. Purpose
    The Exchange proposes to amend Chapters IV of the GEMX Schedule of 
Fees to: (i) Eliminate the Table of

[[Page 26727]]

Contents; (ii) relocate the Port Fees currently in Section IV, E to 
Section IV, C, retitle these fees ``Ports and Other Services'' and 
amend and reorganize the current port fees; and (iv) reserve Section 
IV, Part E. Each change will be described in more detail below. The 
Exchange believes that the proposed amendments to the Schedule of Fees 
will provide more clarity as to the current fees. The Exchange notes 
that no fee changes are being introduced with this rule change. The 
Exchange is simply reorganizing its rules to conform to other Nasdaq 
affiliate markets by aligning the location and description of its rules 
on each market.
Table of Contents
    The Exchange proposes to eliminate the Table of Contents in the 
GEMX Schedule of Fees. The Table Contents are unnecessary. The website 
where the GEMX rules are listed \3\ contains hyperlinks and a skeleton 
of the available rules within the site and enables market participants 
to view all rules in that section.
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    \3\ GEMX rules are located at: http://nasdaqgemx.cchwallstreet.com/.
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Port Fees
    The Exchange currently lists all Port Fees within Chapter IV, Part 
E. The Exchange proposes to relocate the Port Fees to Chapter VI, Part 
C, which is currently reserved, and retitle those fees as ``Ports and 
Other Services.'' The Exchange believes that this title more accurately 
describes the types of fees contained in this chapter. The Exchange 
proposes to restructure the port fees. First, the Exchange proposes to 
add language at the beginning of this new chapter to state, ``The below 
charges are assessed by GEMX for connectivity to GEMX.'' The Exchange 
believes that this sentence makes clear that the fees apply to GEMX. 
The Exchange proposes to define a port as ``a logical connection or 
session that enables a market participant to send inbound messages and/
or receive outbound messages from the Exchange using various 
communication protocols.'' The Exchange believes this definition will 
assist members in distinguishing ports from other offerings.
    The Exchange proposes to restructure the port fees into 4 
categories. The Exchange proposes to list order and quote protocols 
first, order and execution offerings next, followed by data ports and 
other ports as the last section. The Exchange proposes to list data 
offerings that are offered at no cost. The Exchange believes that 
aligning its offerings, where relevant, with other affiliated markets 
\4\ will provide more transparency as to the offerings for market 
participants.
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    \4\ The Exchange offers various services across its 6 affiliated 
options markets, Nasdaq Phlx LLC, Nasdaq BX, Inc., The Nasdaq 
Options Market LLC, Nasdaq GEMX, LLC, Nasdaq MRX, LLC and Nasdaq 
ISE, LLC (``Nasdaq Affiliated Markets'').
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    The Exchange proposes to add a new section (i) and include the 
following introductory sentence, ``The following order and quote 
protocols are available on GEMX.'' The Exchange proposes to list the 
order entry protocol port fees for FIX, SQF, SQF Purge Port and OTTO in 
this section. The fees are not being amended, the existing fees are 
being relocated into new section (i).
    The Exchange proposes to add a new section (ii) and include the 
following introductory sentence, ``The following order and execution 
information is available to Members.'' The Exchange intends to list 
other port or interface information into this section that are 
available to GEMX Members. The Exchange is relocating the CTI and FIX 
DROP port fees. No changes are being made to those fees. The Exchange 
also proposes to list TradeInfo GEMX Interface into this section. The 
Exchange has recently filed to establish this Interface within the GEMX 
rules.\5\ The Exchange proposes to note this interface is available on 
GEMX at no cost.
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    \5\ See SR-GEMX-2018-17 (not yet published).
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    The Exchange proposes to add a new section (iii) and include the 
following language, ``The following data port fees apply in connection 
with data subscriptions pursuant to GEMX Rules at Chapter V. These 
ports are available to non-GEMX Members and GEMX Members.'' Today, GEMX 
does not assess a fee for these ports outlined in new section (iii). 
Similar to other Nasdaq Affiliated Markets the Exchange proposes to 
list all of the ports that Members and Non-Members obtain today at no 
cost. The Exchange believes that listing these ports in addition to the 
data subscriptions will bring more transparency to the Schedule of 
Fees.
    The Exchange proposes to add a new section (iv) entitled ``Other 
ports'' and relocate the Disaster Recovery Ports into this section. The 
Exchange also proposes to make clear that a Disaster Recovery Port is 
available for any port listed in proposed sections (i)-(iii).
    The Exchange proposes to reserve current Chapter IV, Part E.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Securities Exchange Act of 1934 (the 
``Act''),\6\ in general, and furthers the objectives of Section 6(b)(5) 
of the Act,\7\ in particular, in that it is designed to promote just 
and equitable principles of trade, to remove impediments to and perfect 
the mechanism for a free and open market and a national market system, 
and, in general, to protect investors and the public interest, by 
providing greater transparency as to the ports offered on GEMX.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
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    The Exchange's proposal to remove the Table of Contents, relocate 
the Port Fees, retitle and restructure those fees and reserve Chapter 
IV, Part E are administrative. These changes are consistent with the 
protection of investor and the public interest because the amendments 
are intended to bring greater clarity to the Rulebook. The Exchange's 
proposal to reorganize the port fees into sections and include pricing 
for ports that are offered at no cost is also consistent with the 
protection of investor and the public interest because it will bring 
greater transparency to the Exchange's current offerings.

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

    In accordance with Section 6(b)(8) of the Act,\8\ the Exchange does 
not believe that the proposed rule change will impose any burden on 
intermarket or intra-market competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. The Exchange's 
proposal does not impose an undue burden on competition, rather the 
Exchange is seeking to provide greater transparency within its rules 
with respect to the various ports offered on GEMX.
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    \8\ 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 either solicited or received.

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

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \9\ and

[[Page 26728]]

subparagraph (f)(6) of Rule 19b-4 thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \10\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \11\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, Rule 19b-4(f)(6)(iii) \12\ permits the Commission to 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposed 
rule change may become effective and operative immediately upon filing. 
The Exchange states that it believes the waiver will further the 
protection of investors and the public interest because it will provide 
greater transparency as to various ports available to market 
participants. The Exchange further states that the proposed rule change 
will bring greater clarity to the Schedule of Fees. The Commission 
believes that waiver of the 30-day operative delay is consistent with 
the protection of investors and the public interest. Therefore, the 
Commission hereby waives the 30-day operative delay and designates the 
proposed rule change as operative upon filing.\13\
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    \11\ 17 CFR 240.19b-4(f)(6).
    \12\ 17 CFR 240.19b-4(f)(6)(iii).
    \13\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) otherwise in furtherance of the 
purposes of the Act. If the Commission takes such action, the 
Commission shall institute proceedings to determine whether the 
proposed rule should be approved or disapproved.

IV. Solicitation of Comments

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

Electronic 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-GEMX-2018-18 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-GEMX-2018-18. 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-GEMX-2018-18 and should be submitted on 
or before June 29, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-12321 Filed 6-7-18; 8:45 am]
BILLING CODE 8011-01-P