83_FR_62881 83 FR 62648 - Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Exchange's Transaction Fees at Equity 7, Section 118

83 FR 62648 - Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Exchange's Transaction Fees at Equity 7, Section 118

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 233 (December 4, 2018)

Page Range62648-62651
FR Document2018-26267

Federal Register, Volume 83 Issue 233 (Tuesday, December 4, 2018)
[Federal Register Volume 83, Number 233 (Tuesday, December 4, 2018)]
[Notices]
[Pages 62648-62651]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-26267]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84668; File No. SR-BX-2018-057]


Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the 
Exchange's Transaction Fees at Equity 7, Section 118

November 28, 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 November 16, 2018, Nasdaq BX, Inc. (``BX'' or ``Exchange'') filed 
with the Securities and Exchange Commission (``SEC'' or ``Commission'') 
the proposed rule change as described in Items I, II, and III, 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 the Exchange's transaction fees at 
Equity 7, Section 118 to: (i) Eliminate a fee assessed for displayed 
orders; (ii) adopt a new fee for displayed orders; (iii) adopt a new 
fee for non-displayed orders; and (iv) adopt a Qualified Market Maker 
Program and a related fee.
    The text of the proposed rule change is available on the Exchange's 
website at http://nasdaqbx.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 purpose of the proposed rule change is to amend the Exchange's 
transaction fees at Equity 7, Section 118 to: (i) Eliminate a fee 
assessed for displayed orders; (ii) adopt a new fee for displayed 
orders; (iii) adopt a new fee for non-displayed orders; and (iv) adopt 
a Qualified Market Maker Program and a related fee.\3\
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    \3\ The Exchange initially filed the proposed pricing changes on 
November 1, 2018 (SR-BX-2018-053). On November 6, 2018, the Exchange 
withdrew that filing and replaced it with SR-BX-2018-054, which 
corrected a description of the quoting obligation under the QMM 
Program rule and made a technical correction to the purpose 
discussion. On November 16, 2018, the Exchange withdrew SR-BX-2018-
054 and submitted this filing, which makes technical changes and 
provides further description of the QMM Program.
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First Change
    The purpose of the first change is to eliminate a $0.0018 per share 
executed fee assessed for displayed orders. To qualify for the current 
fee, a member must add liquidity equal to or exceeding the member's 
Growth Target. The Growth Target is the liquidity the member added in 
January 2017 as a percent of total Consolidated Volume \4\ plus 0.04% 
of total Consolidated Volume. The fee tier has not provided adequate 
incentive to attract liquidity to the Exchange. Accordingly, the 
Exchange is proposing to eliminate the fee.
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    \4\ The term ``Consolidated Volume'' shall mean the total 
consolidated volume reported to all consolidated transaction 
reporting plans by all exchanges and trade reporting facilities 
during a month in equity securities, excluding executed orders with 
a size of less than one round lot. For purposes of calculating 
Consolidated Volume and the extent of a member's trading activity 
the date of the annual reconstitution of the Russell Investments 
Indexes shall be excluded from both total Consolidated Volume and 
the member's trading activity. See Equity 7, Section 118.
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Second Change
    The purpose of the second change is to adopt a new $0.0016 per 
share executed fee assessed for displayed orders. To qualify for the 
proposed fee, a member must add liquidity equal to or exceeding 0.06% 
of total Consolidated Volume during a month, and remove liquidity equal 
to or exceeding 0.40% of total Consolidated Volume during a month. The 
proposed new fee is similar to existing fees assessed for displayed 
orders, which require a certain level of total Consolidated Volume 
added during a month to qualify; however, the proposed new fee will 
also include a qualification requirement that a member remove a certain 
level of total Consolidated Volume during the month.
Third Change
    The purpose of the third change is to adopt a new $0.0020 per share 
executed fee for non-displayed orders (other than orders with Midpoint 
pegging). To qualify for the proposed fee, a member must meet the 
Qualified Market Maker Program qualification criteria and add 0.10% of 
total Consolidated Volume of non-displayed liquidity. The proposed new 
fee is similar to the certain existing fees assessed for non-displayed 
orders, which requires a certain level of total Consolidated Volume 
added during a month to qualify; however, the proposed new fee will 
also include a qualification requirement that a member also qualify for 
the Qualified Market Maker Program. The Qualified Market Maker Program, 
which is being proposed herein and is discussed immediately below, will 
require a member to provide market-improving behavior in the form of 
quoting and provision of total Consolidated Volume.
Fourth Change
    The purpose of the fourth change is to adopt a Qualified Market 
Maker (``QMM'') Program and a related fee. A QMM is a member that makes 
a significant contribution to market quality by providing liquidity at 
the national best bid and offer (``NBBO'') in a large number of 
securities for a significant portion of the day. A QMM may be, but is 
not required to be, a registered market maker in any security; thus, 
the QMM designation does not by itself impose a two-sided quotation 
obligation or convey any of the benefits associated with being a 
registered market maker. The designation will, however, reflect the 
QMM's commitment to provide meaningful and consistent support to market 
quality and price discovery by extensive quoting at the NBBO in a large 
number of securities. Thus, the program is designed to attract 
liquidity both from traditional market makers and from other firms that 
are willing to commit capital to support liquidity at the NBBO. In 
return for providing the required contribution of market-improving 
liquidity, a QMM will be assessed a lower rate for executions of 
displayed

[[Page 62649]]

orders in securities priced at $1 or more per share that provide 
liquidity on the Exchange System. Through the use of this incentive, 
the Exchange hopes to provide improved trading conditions for all 
market participants through narrower bid-ask spreads and increased 
depth of liquidity available at the inside market. In addition, the 
program reflects an effort to use financial incentives to encourage a 
wider variety of members to make positive commitments to promote market 
quality.
    To be designated as a QMM, a member must quote at the NBBO at least 
25% of the time during regular market hours in an average of at least 
400 securities per day during a month, and provide add volume of at 
least 0.125% of total Consolidated Volume during the month. In return 
for its contributions, the Exchange will assess a lower rate for 
executions of displayed orders in securities priced at $1 or more per 
share that provide liquidity on the Exchange System. Specifically, the 
Exchange is proposing to charge a fee of $0.0016 per share executed 
with respect to all displayed orders in securities priced at $1 or more 
per share that provide liquidity.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\5\ in general, and furthers the objectives of Sections 
6(b)(4) and 6(b)(5) of the Act,\6\ in particular, in that it provides 
for the equitable allocation of reasonable dues, fees and other charges 
among members and issuers and other persons using any facility, and is 
not designed to permit unfair discrimination between customers, 
issuers, brokers, or dealers.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4) and (5).
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    The Commission and the courts have repeatedly expressed their 
preference for competition over regulatory intervention in determining 
prices, products, and services in the securities markets. In Regulation 
NMS, while adopting a series of steps to improve the current market 
model, the Commission highlighted the importance of market forces in 
determining prices and revenues of self-regulatory organizations and, 
also, recognized that current regulation of the market system ``has 
been remarkably successful in promoting market competition in its 
broader forms that are most important to investors and listed 
companies.'' \7\
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    \7\ Securities Exchange Act Release No. 51808 (June 9, 2005), 70 
FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting 
Release'').
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    Likewise, in NetCoalition v. Securities and Exchange Commission \8\ 
(``NetCoalition'') the D.C. Circuit upheld the Commission's use of a 
market-based approach in evaluating the fairness of market data fees 
against a challenge claiming that Congress mandated a cost-based 
approach.\9\ As the court emphasized, the Commission ``intended in 
Regulation NMS that `market forces, rather than regulatory 
requirements' play a role in determining the market data . . . to be 
made available to investors and at what cost.'' \10\
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    \8\ NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010).
    \9\ See NetCoalition, at 534-535.
    \10\ Id. at 537.
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    Further, ``[n]o one disputes that competition for order flow is 
`fierce.' . . . As the SEC explained, `[i]n the U.S. national market 
system, buyers and sellers of securities, and the broker-dealers that 
act as their order-routing agents, have a wide range of choices of 
where to route orders for execution'; [and] `no exchange can afford to 
take its market share percentages for granted' because `no exchange 
possesses a monopoly, regulatory or otherwise, in the execution of 
order flow from broker dealers'. . . .'' \11\
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    \11\ Id. at 539 (quoting Securities Exchange Act Release No. 
59039 (December 2, 2008), 73 FR 74770, 74782-83 (December 9, 2008) 
(SR-NYSEArca-2006-21)).
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First Change
    The Exchange believes that elimination of the $0.0018 per share 
executed fee assessed for displayed orders that provide liquidity is 
reasonable because the Exchange continues to provide similar fees to 
members that meet the qualification criteria required to receive the 
fee. In this regard, the Exchange will provide four fee tiers ranging 
from $0.0017 per share executed to $0.0013 per share executed. For 
example, the Exchange assesses a fee of $0.0017 per share executed for 
displayed orders entered by a member that adds liquidity equal to or 
exceeding 0.15% of total Consolidated Volume during a month. Thus, 
members will continue to have opportunities to receive fees lower than 
the $0.0018 per share executed fee that is being eliminated.
    The Exchange believes that elimination of the $0.0018 per share 
executed fee assessed for displayed orders is an equitable allocation 
and is not unfairly discriminatory because the fee has not 
significantly provided incentive to market participants to provide the 
required level of total Consolidated Volume to receive the fee, and 
consequently the Exchange believes that it should eliminate the fee. 
The Exchange notes that it continues to provide opportunities to its 
members to qualify for fees lower than the $0.0018 per share executed 
fee assessed for displayed orders that provide liquidity.
Second Change
    The Exchange believes that the proposed $0.0016 per share executed 
fee is reasonable because it is similar to the fees currently assessed 
by the Exchange for displayed orders that provide liquidity. As noted 
above, the Exchange provides other fee tiers for displayed orders 
ranging from $0.0017 per share executed to $0.0013 per share executed. 
For example, the Exchange assesses a fee of $0.0017 per share executed 
for displayed orders entered by a member that adds liquidity equal to 
or exceeding 0.15% of total Consolidated Volume during a month. The 
proposed fee will provide another opportunity to members to receive a 
similar fee in return for certain levels of participation on the 
Exchange as measured by total Consolidated Volume.
    The Exchange believes that the proposed $0.0016 per share executed 
fee is an equitable allocation and is not unfairly discriminatory 
because the Exchange will apply the same fee to all similarly situated 
members. To qualify for the new fee, a member must provide certain 
minimum levels of total Consolidated Volume in both transactions that 
add and remove liquidity. The qualification criteria ensure that 
members qualifying for this fee are meaningfully participating on the 
Exchange in a given month. The Exchange notes that any member may 
qualify for the proposed fee if it meets the levels of total 
Consolidated Volume required by the fee's qualification criteria. Thus, 
the Exchange believes that this additional new fee provides all of its 
members with choice and flexibility, and is therefore an equitable 
allocation and not unfairly discriminatory.
Third Change
    The Exchange believes that the proposed $0.0020 per share executed 
fee for non-displayed orders that provide liquidity (other than orders 
with Midpoint pegging) is reasonable because it is similar to other 
fees that the Exchange assesses for non-displayed liquidity. For 
example, the Exchange currently assesses a fee of $0.0024 per share 
executed for non-displayed orders (other than orders with Midpoint 
pegging) entered by a member that adds 0.06% of total Consolidated 
Volume of non-displayed liquidity. The Exchange assesses a fee of 
$0.0030 per share

[[Page 62650]]

executed for all other non-displayed orders.\12\ The proposed fee will 
provide members with an opportunity to receive a lower fee for 
execution of their non-displayed orders. As a consequence, the Exchange 
believes that the proposed fee is reasonable.
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    \12\ The Exchange also assesses fees less than $0.0030 per share 
executed for orders with Midpoint pegging, which are non-displayed 
orders, if the member meets certain qualification criteria. See 
Equity 7, Section 118(a).
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    The Exchange believes that the proposed $0.0020 per share executed 
fee for non-displayed orders (other than orders with Midpoint pegging) 
is an equitable allocation and is not unfairly discriminatory because 
the Exchange will apply the same fee to all similarly situated members. 
Similar to the existing $0.0024 per share executed fee for non-
displayed orders (other than orders with Midpoint pegging), the 
proposed new fee requires that a member provide a certain level of 
total Consolidated Volume of non-displayed liquidity added. In addition 
to total Consolidated Volume, the proposed new fee also requires that a 
member qualify as a QMM under the proposed QMM Program, which requires 
that a member both quotes at the NBBO at least 25% of the time during 
regular market hours in an average of at least 400 securities per day 
during the month, and provides add volume of at least 0.125% total 
Consolidated Volume. Thus, not only must a member provide a certain 
level of total Consolidated Volume in non-displayed liquidity added, 
but it also must provide a certain level of total Consolidated Volume 
in both displayed and non-displayed liquidity added and quoting 
activity at the NBBO. The Exchange notes that any member may qualify as 
a QMM, and in turn also qualify for the proposed non-displayed fee, if 
the member chooses to provide the levels of liquidity and quoting at 
the NBBO required by the QMM Program and new fee qualification 
criteria. As a consequence, the Exchange believes that the proposed fee 
is an equitable allocation and not unfairly discriminatory.
Fourth Change
    The Exchange believes that the proposed $0.0016 per share executed 
fee of the QMM Program for displayed orders that provide liquidity is 
reasonable because it is similar to other fees assessed by the Exchange 
for displayed orders that provide liquidity. In addition to the 
proposed $0.0016 per share executed fee described above, the Exchange 
also has other fee tiers for displayed orders ranging from $0.0017 per 
share executed to $0.0013 per share executed. For example, the Exchange 
assesses a fee of $0.0017 per share executed for displayed orders 
entered by a member that adds liquidity equal to or exceeding 0.15% of 
total Consolidated Volume during a month. The proposed fee will provide 
another opportunity to members to be assessed a similar fee in return 
for certain levels of participation on the Exchange as measured by 
total Consolidated Volume. Unlike other fees currently assessed for 
displayed orders, the proposed QMM Program fee also requires a 
significant level of quoting at the NBBO. Thus, the proposed fee is set 
at a level that is reflective of the beneficial contributions of market 
participants that quote significantly at the NBBO and provide 
significant liquidity.
    The Exchange believes that the proposed $0.0016 per share executed 
fee and qualification criteria of the QMM Program are an equitable 
allocation and are not unfairly discriminatory because the Exchange 
will apply the same fee to all similarly situated members. Moreover, 
the proposed qualification criteria requires a member to provide a 
certain level of total Consolidated Volume in both displayed and non-
displayed liquidity added and to quote significantly at the NBBO. Any 
member may provide the level of total Consolidated Volume and quote at 
the NBBO at the levels required by the qualification criteria of the 
QMM Program. Similar to the other current fee qualification criteria, 
the QMM Program requires a member to provide a certain level of total 
Consolidated Volume to qualify. Unlike other current fee qualification 
criteria, the proposed QMM Program requires a member to quote at the 
NBBO at least 25% of the time during regular market hours in an average 
of at least 400 securities per day during the month. The Exchange notes 
that Nasdaq also has a QMM Program, in which Nasdaq members are 
required to quote at the NBBO at least 25% of the time during regular 
market hours.\13\ In contrast to the Exchange's proposal, Nasdaq 
requires a member to quote at the NBBO in an average of at least 1,000 
securities per day during the month. The Exchange believes that a lower 
requirement of 400 securities per day during the month is appropriate 
given the smaller size and volumes of the Exchange in comparison to 
Nasdaq. For these reasons, the Exchange believes that the proposed QMM 
Program fee and qualification criteria are an equitable allocation and 
are not unfairly discriminatory.
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    \13\ See Nasdaq Rule 7014(d)(2).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. In terms of inter-market 
competition, the Exchange notes that it operates in a highly 
competitive market in which market participants can readily favor 
competing venues if they deem fee levels at a particular venue to be 
excessive or rebate opportunities available at other venues to be more 
favorable. In such an environment, the Exchange must continually adjust 
its fees to remain competitive with other exchanges and with 
alternative trading systems that have been exempted from compliance 
with the statutory standards applicable to exchanges. Because 
competitors are free to modify their own fees in response, and because 
market participants may readily adjust their order routing practices, 
the Exchange believes that the degree to which fee changes in this 
market may impose any burden on competition is extremely limited.
    In this instance, the proposed changes to the fees assessed members 
for execution of all securities priced at $1 or more per share that it 
trades do not impose a burden on competition because the Exchange's 
execution services are completely voluntary and subject to extensive 
competition both from other exchanges and from off-exchange venues. The 
proposed new fees provide opportunities to members to receive lower 
fees for transactions in both displayed and non-displayed orders. The 
fees are designed to provide incentive to members to improve the market 
by requiring certain levels of total Consolidated Volume to qualify for 
the fees. Similarly, the QMM Program fee provides members the 
opportunity to be assessed lower fees for transactions if they improve 
the market by providing both significant total Consolidated Volume and 
quoting at the NBBO meaningfully in a large number of securities. In 
sum, the proposed changes are designed to make the Exchange a more 
desirable venue on which to transact; however, if the changes proposed 
herein are unattractive to market participants, it is likely that the 
Exchange will lose market share as a result. Accordingly, the Exchange 
does not believe that the proposed changes will impair the ability of 
members or competing order execution venues to maintain their 
competitive standing in the financial markets.

[[Page 62651]]

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act.\14\
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    \14\ 15 U.S.C. 78s(b)(3)(A)(ii).
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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-BX-2018-057 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-BX-2018-057. 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-BX-2018-057 and should be submitted on 
or before December 26, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-26267 Filed 12-3-18; 8:45 am]
 BILLING CODE 8011-01-P



     62648                          Federal Register / Vol. 83, No. 233 / Tuesday, December 4, 2018 / Notices

     to make available publicly. All                            any comments it received on the                       liquidity equal to or exceeding 0.40% of
     submissions should refer to File                           proposed rule change. The text of these               total Consolidated Volume during a
     Number SR–BatsBZX–2017–34, and                             statements may be examined at the                     month. The proposed new fee is similar
     should be submitted on or before                           places specified in Item IV below. The                to existing fees assessed for displayed
     December 26, 2018.                                         Exchange has prepared summaries, set                  orders, which require a certain level of
       By the Commission.                                       forth in sections A, B, and C below, of               total Consolidated Volume added
     Eduardo A. Aleman,                                         the most significant aspects of such                  during a month to qualify; however, the
                                                                statements.                                           proposed new fee will also include a
     Assistant Secretary.
                                                                                                                      qualification requirement that a member
     [FR Doc. 2018–26269 Filed 12–3–18; 8:45 am]                A. Self-Regulatory Organization’s
                                                                                                                      remove a certain level of total
     BILLING CODE 8011–01–P                                     Statement of the Purpose of, and
                                                                                                                      Consolidated Volume during the month.
                                                                Statutory Basis for, the Proposed Rule
                                                                Change                                                Third Change
     SECURITIES AND EXCHANGE                                                                                            The purpose of the third change is to
                                                                1. Purpose
     COMMISSION                                                                                                       adopt a new $0.0020 per share executed
                                                                   The purpose of the proposed rule
     [Release No. 34–84668; File No. SR–BX–                                                                           fee for non-displayed orders (other than
                                                                change is to amend the Exchange’s
     2018–057]                                                                                                        orders with Midpoint pegging). To
                                                                transaction fees at Equity 7, Section 118
                                                                                                                      qualify for the proposed fee, a member
     Self-Regulatory Organizations; Nasdaq                      to: (i) Eliminate a fee assessed for
                                                                                                                      must meet the Qualified Market Maker
     BX, Inc.; Notice of Filing and                             displayed orders; (ii) adopt a new fee for
                                                                                                                      Program qualification criteria and add
     Immediate Effectiveness of Proposed                        displayed orders; (iii) adopt a new fee
                                                                                                                      0.10% of total Consolidated Volume of
     Rule Change To Amend the                                   for non-displayed orders; and (iv) adopt
                                                                                                                      non-displayed liquidity. The proposed
     Exchange’s Transaction Fees at Equity                      a Qualified Market Maker Program and
                                                                                                                      new fee is similar to the certain existing
     7, Section 118                                             a related fee.3
                                                                                                                      fees assessed for non-displayed orders,
     November 28, 2018.
                                                                First Change                                          which requires a certain level of total
                                                                   The purpose of the first change is to              Consolidated Volume added during a
        Pursuant to Section 19(b)(1) of the
                                                                eliminate a $0.0018 per share executed                month to qualify; however, the
     Securities Exchange Act of 1934
                                                                fee assessed for displayed orders. To                 proposed new fee will also include a
     (‘‘Act’’),1 and Rule 19b–4 thereunder,2
                                                                qualify for the current fee, a member                 qualification requirement that a member
     notice is hereby given that on November
                                                                must add liquidity equal to or exceeding              also qualify for the Qualified Market
     16, 2018, Nasdaq BX, Inc. (‘‘BX’’ or
                                                                the member’s Growth Target. The                       Maker Program. The Qualified Market
     ‘‘Exchange’’) filed with the Securities
                                                                Growth Target is the liquidity the                    Maker Program, which is being
     and Exchange Commission (‘‘SEC’’ or
                                                                member added in January 2017 as a                     proposed herein and is discussed
     ‘‘Commission’’) the proposed rule
                                                                percent of total Consolidated Volume 4                immediately below, will require a
     change as described in Items I, II, and
                                                                plus 0.04% of total Consolidated                      member to provide market-improving
     III, below, which Items have been
                                                                Volume. The fee tier has not provided                 behavior in the form of quoting and
     prepared by the Exchange. The
                                                                adequate incentive to attract liquidity to            provision of total Consolidated Volume.
     Commission is publishing this notice to
     solicit comments on the proposed rule                      the Exchange. Accordingly, the                        Fourth Change
     change from interested persons.                            Exchange is proposing to eliminate the
                                                                                                                         The purpose of the fourth change is to
                                                                fee.
     I. Self-Regulatory Organization’s                                                                                adopt a Qualified Market Maker
     Statement of the Terms of Substance of                     Second Change                                         (‘‘QMM’’) Program and a related fee. A
     the Proposed Rule Change                                     The purpose of the second change is                 QMM is a member that makes a
                                                                to adopt a new $0.0016 per share                      significant contribution to market
        The Exchange proposes to amend the
                                                                executed fee assessed for displayed                   quality by providing liquidity at the
     Exchange’s transaction fees at Equity 7,
                                                                orders. To qualify for the proposed fee,              national best bid and offer (‘‘NBBO’’) in
     Section 118 to: (i) Eliminate a fee
                                                                a member must add liquidity equal to or               a large number of securities for a
     assessed for displayed orders; (ii) adopt
     a new fee for displayed orders; (iii)                      exceeding 0.06% of total Consolidated                 significant portion of the day. A QMM
     adopt a new fee for non-displayed                          Volume during a month, and remove                     may be, but is not required to be, a
     orders; and (iv) adopt a Qualified                                                                               registered market maker in any security;
     Market Maker Program and a related fee.                       3 The Exchange initially filed the proposed        thus, the QMM designation does not by
        The text of the proposed rule change                    pricing changes on November 1, 2018 (SR–BX–           itself impose a two-sided quotation
     is available on the Exchange’s website at
                                                                2018–053). On November 6, 2018, the Exchange          obligation or convey any of the benefits
                                                                withdrew that filing and replaced it with SR–BX–      associated with being a registered
     http://nasdaqbx.cchwallstreet.com/, at                     2018–054, which corrected a description of the
     the principal office of the Exchange, and                  quoting obligation under the QMM Program rule         market maker. The designation will,
     at the Commission’s Public Reference                       and made a technical correction to the purpose        however, reflect the QMM’s
     Room.
                                                                discussion. On November 16, 2018, the Exchange        commitment to provide meaningful and
                                                                withdrew SR–BX–2018–054 and submitted this            consistent support to market quality and
     II. Self-Regulatory Organization’s                         filing, which makes technical changes and provides
                                                                further description of the QMM Program.               price discovery by extensive quoting at
     Statement of the Purpose of, and                              4 The term ‘‘Consolidated Volume’’ shall mean      the NBBO in a large number of
     Statutory Basis for, the Proposed Rule                     the total consolidated volume reported to all         securities. Thus, the program is
     Change                                                     consolidated transaction reporting plans by all       designed to attract liquidity both from
                                                                exchanges and trade reporting facilities during a
        In its filing with the Commission, the                  month in equity securities, excluding executed
                                                                                                                      traditional market makers and from
     Exchange included statements                               orders with a size of less than one round lot. For    other firms that are willing to commit
     concerning the purpose of and basis for                    purposes of calculating Consolidated Volume and       capital to support liquidity at the NBBO.
                                                                the extent of a member’s trading activity the date    In return for providing the required
     the proposed rule change and discussed                     of the annual reconstitution of the Russell
                                                                Investments Indexes shall be excluded from both
                                                                                                                      contribution of market-improving
       1 15   U.S.C. 78s(b)(1).                                 total Consolidated Volume and the member’s            liquidity, a QMM will be assessed a
       2 17   CFR 240.19b–4.                                    trading activity. See Equity 7, Section 118.          lower rate for executions of displayed


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                                 Federal Register / Vol. 83, No. 233 / Tuesday, December 4, 2018 / Notices                                           62649

     orders in securities priced at $1 or more                  Likewise, in NetCoalition v. Securities            that it should eliminate the fee. The
     per share that provide liquidity on the                 and Exchange Commission 8                             Exchange notes that it continues to
     Exchange System. Through the use of                     (‘‘NetCoalition’’) the D.C. Circuit upheld            provide opportunities to its members to
     this incentive, the Exchange hopes to                   the Commission’s use of a market-based                qualify for fees lower than the $0.0018
     provide improved trading conditions for                 approach in evaluating the fairness of                per share executed fee assessed for
     all market participants through                         market data fees against a challenge                  displayed orders that provide liquidity.
     narrower bid-ask spreads and increased                  claiming that Congress mandated a cost-
                                                                                                                   Second Change
     depth of liquidity available at the inside              based approach.9 As the court
     market. In addition, the program reflects               emphasized, the Commission ‘‘intended                    The Exchange believes that the
     an effort to use financial incentives to                in Regulation NMS that ‘market forces,                proposed $0.0016 per share executed fee
     encourage a wider variety of members to                 rather than regulatory requirements’                  is reasonable because it is similar to the
     make positive commitments to promote                    play a role in determining the market                 fees currently assessed by the Exchange
     market quality.                                         data . . . to be made available to                    for displayed orders that provide
                                                             investors and at what cost.’’ 10                      liquidity. As noted above, the Exchange
        To be designated as a QMM, a                                                                               provides other fee tiers for displayed
                                                                Further, ‘‘[n]o one disputes that
     member must quote at the NBBO at least                                                                        orders ranging from $0.0017 per share
                                                             competition for order flow is ‘fierce.’
     25% of the time during regular market                                                                         executed to $0.0013 per share executed.
                                                             . . . As the SEC explained, ‘[i]n the U.S.
     hours in an average of at least 400                                                                           For example, the Exchange assesses a
                                                             national market system, buyers and
     securities per day during a month, and                                                                        fee of $0.0017 per share executed for
                                                             sellers of securities, and the broker-
     provide add volume of at least 0.125%                                                                         displayed orders entered by a member
                                                             dealers that act as their order-routing
     of total Consolidated Volume during the                                                                       that adds liquidity equal to or exceeding
                                                             agents, have a wide range of choices of
     month. In return for its contributions,                                                                       0.15% of total Consolidated Volume
                                                             where to route orders for execution’;
     the Exchange will assess a lower rate for               [and] ‘no exchange can afford to take its             during a month. The proposed fee will
     executions of displayed orders in                       market share percentages for granted’                 provide another opportunity to
     securities priced at $1 or more per share               because ‘no exchange possesses a                      members to receive a similar fee in
     that provide liquidity on the Exchange                  monopoly, regulatory or otherwise, in                 return for certain levels of participation
     System. Specifically, the Exchange is                   the execution of order flow from broker               on the Exchange as measured by total
     proposing to charge a fee of $0.0016 per                dealers’. . . .’’ 11                                  Consolidated Volume.
     share executed with respect to all                                                                               The Exchange believes that the
     displayed orders in securities priced at                First Change                                          proposed $0.0016 per share executed fee
     $1 or more per share that provide                          The Exchange believes that                         is an equitable allocation and is not
     liquidity.                                              elimination of the $0.0018 per share                  unfairly discriminatory because the
     2. Statutory Basis                                      executed fee assessed for displayed                   Exchange will apply the same fee to all
                                                             orders that provide liquidity is                      similarly situated members. To qualify
        The Exchange believes that its                       reasonable because the Exchange                       for the new fee, a member must provide
     proposal is consistent with Section 6(b)                continues to provide similar fees to                  certain minimum levels of total
     of the Act,5 in general, and furthers the               members that meet the qualification                   Consolidated Volume in both
     objectives of Sections 6(b)(4) and 6(b)(5)              criteria required to receive the fee. In              transactions that add and remove
     of the Act,6 in particular, in that it                  this regard, the Exchange will provide                liquidity. The qualification criteria
     provides for the equitable allocation of                four fee tiers ranging from $0.0017 per               ensure that members qualifying for this
     reasonable dues, fees and other charges                 share executed to $0.0013 per share                   fee are meaningfully participating on
     among members and issuers and other                     executed. For example, the Exchange                   the Exchange in a given month. The
     persons using any facility, and is not                  assesses a fee of $0.0017 per share                   Exchange notes that any member may
     designed to permit unfair                               executed for displayed orders entered                 qualify for the proposed fee if it meets
     discrimination between customers,                       by a member that adds liquidity equal                 the levels of total Consolidated Volume
     issuers, brokers, or dealers.                           to or exceeding 0.15% of total                        required by the fee’s qualification
        The Commission and the courts have                   Consolidated Volume during a month.                   criteria. Thus, the Exchange believes
     repeatedly expressed their preference                   Thus, members will continue to have                   that this additional new fee provides all
     for competition over regulatory                         opportunities to receive fees lower than              of its members with choice and
     intervention in determining prices,                     the $0.0018 per share executed fee that               flexibility, and is therefore an equitable
     products, and services in the securities                is being eliminated.                                  allocation and not unfairly
     markets. In Regulation NMS, while                          The Exchange believes that                         discriminatory.
     adopting a series of steps to improve the               elimination of the $0.0018 per share
                                                                                                                   Third Change
     current market model, the Commission                    executed fee assessed for displayed
                                                             orders is an equitable allocation and is                 The Exchange believes that the
     highlighted the importance of market
                                                             not unfairly discriminatory because the               proposed $0.0020 per share executed fee
     forces in determining prices and
                                                             fee has not significantly provided                    for non-displayed orders that provide
     revenues of self-regulatory organizations
                                                             incentive to market participants to                   liquidity (other than orders with
     and, also, recognized that current
                                                             provide the required level of total                   Midpoint pegging) is reasonable because
     regulation of the market system ‘‘has
                                                             Consolidated Volume to receive the fee,               it is similar to other fees that the
     been remarkably successful in
                                                             and consequently the Exchange believes                Exchange assesses for non-displayed
     promoting market competition in its
                                                                                                                   liquidity. For example, the Exchange
     broader forms that are most important to                  8 NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir.      currently assesses a fee of $0.0024 per
     investors and listed companies.’’ 7                     2010).                                                share executed for non-displayed orders
                                                               9 See NetCoalition, at 534–535.
       5 15
                                                                                                                   (other than orders with Midpoint
             U.S.C. 78f(b).                                    10 Id. at 537.
       6 15
                                                                                                                   pegging) entered by a member that adds
             U.S.C. 78f(b)(4) and (5).                         11 Id. at 539 (quoting Securities Exchange Act
        7 Securities Exchange Act Release No. 51808          Release No. 59039 (December 2, 2008), 73 FR
                                                                                                                   0.06% of total Consolidated Volume of
     (June 9, 2005), 70 FR 37496, 37499 (June 29, 2005)      74770, 74782–83 (December 9, 2008) (SR–               non-displayed liquidity. The Exchange
     (‘‘Regulation NMS Adopting Release’’).                  NYSEArca–2006–21)).                                   assesses a fee of $0.0030 per share


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     62650                       Federal Register / Vol. 83, No. 233 / Tuesday, December 4, 2018 / Notices

     executed for all other non-displayed                    executed. For example, the Exchange                    B. Self-Regulatory Organization’s
     orders.12 The proposed fee will provide                 assesses a fee of $0.0017 per share                    Statement on Burden on Competition
     members with an opportunity to receive                  executed for displayed orders entered                     The Exchange does not believe that
     a lower fee for execution of their non-                 by a member that adds liquidity equal                  the proposed rule change will impose
     displayed orders. As a consequence, the                 to or exceeding 0.15% of total                         any burden on competition not
     Exchange believes that the proposed fee                 Consolidated Volume during a month.                    necessary or appropriate in furtherance
     is reasonable.                                          The proposed fee will provide another                  of the purposes of the Act. In terms of
        The Exchange believes that the                       opportunity to members to be assessed                  inter-market competition, the Exchange
     proposed $0.0020 per share executed fee                 a similar fee in return for certain levels             notes that it operates in a highly
     for non-displayed orders (other than                    of participation on the Exchange as                    competitive market in which market
     orders with Midpoint pegging) is an                     measured by total Consolidated Volume.                 participants can readily favor competing
     equitable allocation and is not unfairly                Unlike other fees currently assessed for               venues if they deem fee levels at a
     discriminatory because the Exchange                     displayed orders, the proposed QMM                     particular venue to be excessive or
     will apply the same fee to all similarly                Program fee also requires a significant                rebate opportunities available at other
     situated members. Similar to the                        level of quoting at the NBBO. Thus, the                venues to be more favorable. In such an
     existing $0.0024 per share executed fee                 proposed fee is set at a level that is                 environment, the Exchange must
     for non-displayed orders (other than                    reflective of the beneficial contributions             continually adjust its fees to remain
     orders with Midpoint pegging), the                      of market participants that quote                      competitive with other exchanges and
     proposed new fee requires that a                        significantly at the NBBO and provide                  with alternative trading systems that
     member provide a certain level of total                 significant liquidity.                                 have been exempted from compliance
     Consolidated Volume of non-displayed                       The Exchange believes that the
     liquidity added. In addition to total                                                                          with the statutory standards applicable
                                                             proposed $0.0016 per share executed fee                to exchanges. Because competitors are
     Consolidated Volume, the proposed                       and qualification criteria of the QMM
     new fee also requires that a member                                                                            free to modify their own fees in
                                                             Program are an equitable allocation and                response, and because market
     qualify as a QMM under the proposed                     are not unfairly discriminatory because
     QMM Program, which requires that a                                                                             participants may readily adjust their
                                                             the Exchange will apply the same fee to                order routing practices, the Exchange
     member both quotes at the NBBO at                       all similarly situated members.
     least 25% of the time during regular                                                                           believes that the degree to which fee
                                                             Moreover, the proposed qualification                   changes in this market may impose any
     market hours in an average of at least                  criteria requires a member to provide a
     400 securities per day during the month,                                                                       burden on competition is extremely
                                                             certain level of total Consolidated                    limited.
     and provides add volume of at least
                                                             Volume in both displayed and non-                         In this instance, the proposed changes
     0.125% total Consolidated Volume.
                                                             displayed liquidity added and to quote                 to the fees assessed members for
     Thus, not only must a member provide
                                                             significantly at the NBBO. Any member                  execution of all securities priced at $1
     a certain level of total Consolidated
                                                             may provide the level of total                         or more per share that it trades do not
     Volume in non-displayed liquidity
                                                             Consolidated Volume and quote at the                   impose a burden on competition
     added, but it also must provide a certain
                                                             NBBO at the levels required by the                     because the Exchange’s execution
     level of total Consolidated Volume in
                                                             qualification criteria of the QMM                      services are completely voluntary and
     both displayed and non-displayed
                                                             Program. Similar to the other current fee              subject to extensive competition both
     liquidity added and quoting activity at
     the NBBO. The Exchange notes that any                   qualification criteria, the QMM Program                from other exchanges and from off-
     member may qualify as a QMM, and in                     requires a member to provide a certain                 exchange venues. The proposed new
     turn also qualify for the proposed non-                 level of total Consolidated Volume to                  fees provide opportunities to members
     displayed fee, if the member chooses to                 qualify. Unlike other current fee                      to receive lower fees for transactions in
     provide the levels of liquidity and                     qualification criteria, the proposed                   both displayed and non-displayed
     quoting at the NBBO required by the                     QMM Program requires a member to                       orders. The fees are designed to provide
     QMM Program and new fee                                 quote at the NBBO at least 25% of the                  incentive to members to improve the
     qualification criteria. As a consequence,               time during regular market hours in an                 market by requiring certain levels of
     the Exchange believes that the proposed                 average of at least 400 securities per day             total Consolidated Volume to qualify for
     fee is an equitable allocation and not                  during the month. The Exchange notes                   the fees. Similarly, the QMM Program
     unfairly discriminatory.                                that Nasdaq also has a QMM Program,                    fee provides members the opportunity
                                                             in which Nasdaq members are required                   to be assessed lower fees for
     Fourth Change                                           to quote at the NBBO at least 25% of the               transactions if they improve the market
       The Exchange believes that the                        time during regular market hours.13 In                 by providing both significant total
     proposed $0.0016 per share executed fee                 contrast to the Exchange’s proposal,                   Consolidated Volume and quoting at the
     of the QMM Program for displayed                        Nasdaq requires a member to quote at                   NBBO meaningfully in a large number
     orders that provide liquidity is                        the NBBO in an average of at least 1,000               of securities. In sum, the proposed
     reasonable because it is similar to other               securities per day during the month.                   changes are designed to make the
     fees assessed by the Exchange for                       The Exchange believes that a lower                     Exchange a more desirable venue on
     displayed orders that provide liquidity.                requirement of 400 securities per day                  which to transact; however, if the
     In addition to the proposed $0.0016 per                 during the month is appropriate given                  changes proposed herein are
     share executed fee described above, the                 the smaller size and volumes of the                    unattractive to market participants, it is
     Exchange also has other fee tiers for                   Exchange in comparison to Nasdaq. For                  likely that the Exchange will lose
     displayed orders ranging from $0.0017                   these reasons, the Exchange believes                   market share as a result. Accordingly,
     per share executed to $0.0013 per share                 that the proposed QMM Program fee                      the Exchange does not believe that the
                                                             and qualification criteria are an                      proposed changes will impair the ability
        12 The Exchange also assesses fees less than         equitable allocation and are not unfairly              of members or competing order
     $0.0030 per share executed for orders with              discriminatory.                                        execution venues to maintain their
     Midpoint pegging, which are non-displayed orders,
     if the member meets certain qualification criteria.                                                            competitive standing in the financial
     See Equity 7, Section 118(a).                             13 See   Nasdaq Rule 7014(d)(2).                     markets.


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                                     Federal Register / Vol. 83, No. 233 / Tuesday, December 4, 2018 / Notices                                                   62651

     C. Self-Regulatory Organization’s                          those that may be withheld from the                   the Exchange’s best priced Order under
     Statement on Comments on the                               public in accordance with the                         Rule 4756(c)(2). While these
     Proposed Rule Change Received From                         provisions of 5 U.S.C. 552, will be                   amendments are effective upon filing,
     Members, Participants, or Others                           available for website viewing and                     the Exchange has designated the
       No written comments were either                          printing in the Commission’s Public                   proposed amendments to be operative
     solicited or received.                                     Reference Room, 100 F Street NE,                      in the first quarter of 2019, and will
                                                                Washington, DC 20549, on official                     announce the precise date by Equity
     III. Date of Effectiveness of the                          business days between the hours of                    Trader Alert at least thirty days prior to
     Proposed Rule Change and Timing for                        10:00 a.m. and 3:00 p.m. Copies of the                implementation.
     Commission Action                                          filing also will be available for                        The text of the proposed rule change
        The foregoing rule change has become                    inspection and copying at the principal               is available on the Exchange’s website at
     effective pursuant to Section                              office of the Exchange. All comments                  http://nasdaqbx.cchwallstreet.com/, at
     19(b)(3)(A)(ii) of the Act.14                              received will be posted without change.               the principal office of the Exchange, and
        At any time within 60 days of the                       Persons submitting comments are                       at the Commission’s Public Reference
     filing of the proposed rule change, the                    cautioned that we do not redact or edit               Room.
     Commission summarily may                                   personal identifying information from
     temporarily suspend such rule change if                    comment submissions. You should                       II. Self-Regulatory Organization’s
     it appears to the Commission that such                     submit only information that you wish                 Statement of the Purpose of, and
     action is: (i) Necessary or appropriate in                 to make available publicly. All                       Statutory Basis for, the Proposed Rule
     the public interest; (ii) for the protection               submissions should refer to File                      Change
     of investors; or (iii) otherwise in                        Number SR–BX–2018–057 and should
                                                                be submitted on or before December 26,                  In its filing with the Commission, the
     furtherance of the purposes of the Act.                                                                          Exchange included statements
     If the Commission takes such action, the                   2018.
                                                                                                                      concerning the purpose of and basis for
     Commission shall institute proceedings                       For the Commission, by the Division of              the proposed rule change and discussed
     to determine whether the proposed rule                     Trading and Markets, pursuant to delegated
                                                                                                                      any comments it received on the
     should be approved or disapproved.                         authority.15
                                                                                                                      proposed rule change. The text of these
                                                                Eduardo A. Aleman,
     IV. Solicitation of Comments                                                                                     statements may be examined at the
                                                                Assistant Secretary.
       Interested persons are invited to                                                                              places specified in Item IV below. The
                                                                [FR Doc. 2018–26267 Filed 12–3–18; 8:45 am]
     submit written data, views, and                                                                                  Exchange has prepared summaries, set
                                                                BILLING CODE 8011–01–P                                forth in sections A, B, and C below, of
     arguments concerning the foregoing,
     including whether the proposed rule                                                                              the most significant aspects of such
     change is consistent with the Act.                                                                               statements.
                                                                SECURITIES AND EXCHANGE
     Comments may be submitted by any of                        COMMISSION                                            A. Self-Regulatory Organization’s
     the following methods:                                                                                           Statement of the Purpose of, and
                                                                [Release No. 34–84674; File No. SR–BX–
     Electronic Comments                                        2018–058]                                             Statutory Basis for, the Proposed Rule
                                                                                                                      Change
       • Use the Commission’s internet
                                                                Self-Regulatory Organizations; Nasdaq                 1. Purpose
     comment form (http://www.sec.gov/                          BX, Inc.; Notice of Filing and
     rules/sro.shtml); or                                       Immediate Effectiveness of Proposed
       • Send an email to rule-comments@                                                                                 The Exchange is proposing to amend
                                                                Rule Change To Amend Rule 4756(c)(2)                  Rule 4756 to allow the Exchange to
     sec.gov. Please include File Number SR–
     BX–2018–057 on the subject line.                                                                                 aggregate Displayed 3 odd-lot Orders
                                                                November 28, 2018.
                                                                                                                      across price levels for transmission to
     Paper Comments                                                Pursuant to Section 19(b)(1) of the                network processors as the Exchange’s
                                                                Securities Exchange Act of 1934
       • Send paper comments in triplicate                      (‘‘Act’’),1 and Rule 19b–4 thereunder,2
                                                                                                                      best ranked Displayed Order(s), which
     to Secretary, Securities and Exchange                                                                            is based on how NYSE Arca, Inc.
                                                                notice is hereby given that on November               handles such orders pursuant to NYSE
     Commission, 100 F Street NE,                               16, 2018, Nasdaq BX, Inc. (‘‘BX’’ or
     Washington, DC 20549–1090.                                                                                       Arca Rule 7.36–E(b)(3).4 Rule 4756
                                                                ‘‘Exchange’’) filed with the Securities
     All submissions should refer to File                                                                             concerns entry and display of Quotes 5
                                                                and Exchange Commission (‘‘SEC’’ or
     Number SR–BX–2018–057. This file                           ‘‘Commission’’) the proposed rule
     number should be included on the                           change as described in Items I and II
                                                                                                                        3 Display is an Order Attribute that allows the

     subject line if email is used. To help the                                                                       price and size of an Order to be displayed to market
                                                                below, which Items have been prepared                 participants via market data feeds. Certain Order
     Commission process and review your                         by the Exchange. The Commission is                    Types may be non-displayed if they are not
     comments more efficiently, please use                      publishing this notice to solicit                     assigned a Display Order Attribute, and all non-
     only one method. The Commission will                       comments on the proposed rule change
                                                                                                                      displayed Orders may be referred to as ‘‘Non-
     post all comments on the Commission’s                                                                            Displayed Orders’’ (See Rule 4703(b)(3)(A) [sic]). In
                                                                from interested persons.                              contrast, an Order with a Display Order Attribute
     internet website (http://www.sec.gov/                                                                            may be referred to as a ‘‘Displayed Order.’’ See Rule
     rules/sro.shtml). Copies of the                            I. Self-Regulatory Organization’s                     4703(k).
     submission, all subsequent                                 Statement of the Terms of Substance of                  4 See Securities Exchange Act Release No. 74796

     amendments, all written statements                         the Proposed Rule Change                              (April 23, 2015), 80 FR 23838 (April 29, 2015) (SR–
                                                                                                                      NYSEArca–2015–08).
     with respect to the proposed rule                             The Exchange proposes to allow the                   5 The term ‘‘Quote’’ means a single bid or offer
     change that are filed with the                             Exchange to aggregate Displayed odd-lot               quotation submitted to the System by a Market
     Commission, and all written                                Orders across price levels for                        Maker or Equities Electronic Communications
     communications relating to the                             transmission to network processors as                 Network and designated for display (price and size)
     proposed rule change between the                                                                                 next to the Participant’s Market Participant
                                                                                                                      Identifier in the Exchange Book. Quotes are entered
     Commission and any person, other than                        15 17 CFR 200.30–3(a)(12).                          in the form of Orders with Attribution (as defined
                                                                  1 15 U.S.C. 78s(b)(1).                              in Rule 4703). Accordingly, all Quotes are also
       14 15   U.S.C. 78s(b)(3)(A)(ii).                           2 17 CFR 240.19b–4.                                 Orders. See Rule 4701(d).



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Document Created: 2018-12-04 00:43:06
Document Modified: 2018-12-04 00:43:06
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 62648 

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