Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Its Fee Schedule To Modify the Exchange's Connectivity Fees, 67016-67019 [2016-23497]
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67016
Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Notices
requirements, which depend on the type
of annuity payable. The requirements
for obtaining the annuities are
prescribed in 20 CFR 216 and 220.
To collect the information needed to
help determine an applicant’s
entitlement to, and the amount of, an
employee retirement annuity the RRB
uses Forms AA–1, Application for
Employee Annuity; AA–1d, Application
for Determination of Employee
Disability; G–204, Verification of
Workers Compensation/Public
Disability Benefit Information, and
electronic Forms AA–1cert, Application
Summary and Certification, and AA–
1sum, Application Summary.
The AA–1 application process obtains
information from an applicant about
their marital history, work history,
military service, benefits from other
governmental agencies, railroad
pensions and Medicare entitlement for
either an age and service or disability
annuity. An RRB representative
interviews the applicant either at a field
office, an itinerant point, or by
telephone. During the interview, the
RRB representative enters the
information obtained into an on-line
information system. Upon completion of
the interview, the on-line information
system generates Form AA–1cert,
Application Summary and Certification,
or Form AA–1sum, Application
Summary, a summary of the information
that was provided for the applicant to
review and approve. Form AA–1cert
documents approval using the
traditional pen and ink ‘‘wet’’ signature,
and Form AA–1sum documents
approval using the alternative signature
method called Attestation. When the
RRB representative is unable to contact
the applicant in person or by telephone,
for example, the applicant lives in
another country, a manual version of
Form AA–1 is used.
Form AA–1d, Application for
Determination of Employee’s Disability,
is completed by an employee who is
filing for a disability annuity under the
RRA, or a disability freeze under the
Social Security Act for early Medicare
based on a disability. Form G–204,
Verification of Worker’s Compensation/
Public Disability Benefit Information, is
used to obtain and verify information
concerning a worker’s compensation or
a public disability benefit that is or will
be paid by a public agency to a disabled
railroad employee.
One response is requested of each
respondent. Completion of the forms is
required to obtain/retain a benefit.
Previous Requests for Comments: The
RRB has already published the initial
60-day notice (81 FR 47183 on July 20,
2016) required by 44 U.S.C. 3506(c)(2).
That request elicited no comments.
Title: Application for Employee
Annuity Under the Railroad Retirement
Act.
OMB Control Number: 3220–0002.
Form(s) submitted: AA–1, AA–1cert,
AA–1d, AA–1sum and G–204.
Type of request: Revision of a
currently approved collection.
Affected public: Individuals or
Households.
Abstract: The Railroad Retirement Act
provides for payment of age, disability
and supplemental annuities to qualified
employees. The application and related
forms obtain information about the
applicant’s family work history, military
service, disability benefits from other
government agencies and public or
private pensions. The information is
used to determine entitlement to and
the amount of the annuity applied for.
Changes proposed: The RRB proposes
the following changes to Forms AA–1
and AA–1d:
• Deletion of Item 35a-d from Form
AA–1, regarding the relinquishment of
seniority rights;
• the relocation of current Items 52–
53 from Form AA–1d to proposed Items
48a-b on Form AA–1, regarding whether
an applicant had filed or expected to file
a lawsuit or claim against a person or
company for a personal injury that
resulted in the payment of sickness
benefits by the RRB, as the potential for
uncollected sickness benefits can apply
to both a disability applicant as well as
an applicant qualified for an age and
service annuity.
• Comparable revisions to electronic
equivalent forms (AA–1cert and AA–
1sum) are also being proposed.
No other changes are proposed.
The burden estimate for the ICR is as
follows:
Annual
responses
Form No.
Time
(minutes)
Burden
(hours)
100
4,620
8,000
2,600
5
20
62
30
29
60
85
15
103
2,310
3,867
2,600
7
5
Total ......................................................................................................................................
mstockstill on DSK3G9T082PROD with NOTICES
AA–1 (without assistance) ...........................................................................................................
AA–1cert (with assistance) ..........................................................................................................
AA–1sum (with assistance) .........................................................................................................
AA–1d (with assistance) ..............................................................................................................
AA–1d (without assistance) .........................................................................................................
G–204 ..........................................................................................................................................
15,345
........................
8,892
Additional Information or Comments:
Copies of the forms and supporting
documents can be obtained from Dana
Hickman at (312) 751–4981 or
Dana.Hickman@RRB.GOV.
Comments regarding the information
collection should be addressed to
Charles Mierzwa, Railroad Retirement
Board, 844 North Rush Street, Chicago,
Illinois, 60611–1275 or
Charles.Mierzwa@RRB.GOV and to the
OMB Desk Officer for the RRB, Fax:
202–395–6974, Email address: OIRA_
Submission@omb.eop.gov.
SECURITIES AND EXCHANGE
COMMISSION
Charles Mierzwa,
Associate Chief Information Officer for Policy
and Compliance.
[Release No. 34–78919; File No. SR–MIAX–
2016–32]
[FR Doc. 2016–23526 Filed 9–28–16; 8:45 am]
BILLING CODE 7905–01–P
Self-Regulatory Organizations; Miami
International Securities Exchange LLC;
Notice of Filing and Immediate
Effectiveness of Proposed Rule
Change To Amend Its Fee Schedule To
Modify the Exchange’s Connectivity
Fees
September 23, 2016.
Pursuant to the provisions of Section
19(b)(1) of the Securities Exchange Act
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Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Notices
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 notice is hereby given that
on September 12, 2016, Miami
International Securities Exchange LLC
(‘‘MIAX’’ or ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) a 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange is filing a proposal to
amend the MIAX Options Fee Schedule
(the ‘‘Fee Schedule’’) to modify the
Exchange’s connectivity fees.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://www.miaxoptions.com/filter/
wotitle/rule_filing, at MIAX’s principal
office, 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
mstockstill on DSK3G9T082PROD with NOTICES
1. Purpose
The Exchange proposes to amend its
Fee Schedule regarding connectivity to
the Exchange. Specifically, the
Exchange proposes to amend Section 4
of the Fee Schedule, Testing and
Certification Fees, to state that Member
and Non-Member Network Connectivity
Testing and Certification Fees will not
be assessed for testing and certification
of connectivity to the Exchange’s
disaster recovery systems (for purposes
of the Fee Schedule, the ‘‘Disaster
Recovery Facility’’).3 The Exchange also
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Exchange Rule 321. See also, Securities
Exchange Act Release No. 76303 (October 29, 2015),
2 17
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18:51 Sep 28, 2016
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proposes to amend Section 5 of the Fee
Schedule, System Connectivity Fees, to
establish a new connectivity fee for 1
Gigabit (‘‘Gb’’) and 10 Gb fiber
connections to the Exchange’s Disaster
Recovery Facility.
Testing and Certification Fees
The Exchange currently offers various
bandwidth alternatives for connectivity
to the Exchange’s System,4 including a
10 Gb fiber connection, a 1 Gb fiber
connection and a 10 Gb ultra-low
latency (‘‘ULL’’) fiber connection. The
Exchange currently assesses a Member
Network Connectivity Testing and
Certification Fee of $1,000 for each 1 Gb
connection, and $4,000 for each 10 Gb
or 10 Gb ULL connection.5 NonMembers are assessed a Non-Member
Network Connectivity Testing and
Certification Fee of $1,200 for each 1 Gb
connection, and $4,200 for each 10 Gb
or 10 Gb ULL connection.6 The
Exchange proposes to amend Sections
4(c) and 4(d) of the Fee Schedule to
state that these Member and NonMember Network Connectivity Testing
and Certification Fees will not be
assessed for testing and certification of
connectivity to the Exchange’s Disaster
Recovery Facility.
The purpose of the Exchange’s
proposal not to charge Member and
Non-Member network connectivity
testing and certification fees for testing
required in order to connect to the
Disaster Recovery Facility is to
eliminate any potential impediment to
Members and Non-Members in testing
and certifying for connectivity to the
Disaster Recovery Facility, and to
encourage Members and Non-Members
to set up the connections to such
Facility for disaster recovery purposes.
System Connectivity Fees
The Exchange currently assesses
Monthly Member Network Connectivity
fees for the applicable connectivity in
any month when a Member or NonMember is credentialed to use any of the
MIAX APIs or Market Data feeds in the
production environment.
The Exchange proposes to amend the
table in Section 5 of the Fee Schedule
to explicitly reflect the monthly Member
and Non-Member Network connectivity
fees as they apply to the Exchange’s
primary and secondary facilities, and to
the Exchange’s Disaster Recovery
Facility. Under the proposal, fees for
80 FR 68373 (November 4, 2015) (SR–MIAX–2015–
61).
4 The term ‘‘System’’ means the automated
trading system used by the Exchange for the trading
of securities. See Exchange Rule 100.
5 See Fee Schedule Section 4(c).
6 See Fee Schedule Section 4(d).
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connectivity to the Exchange’s primary
and secondary (i.e., backup) facilities
will remain unchanged. The Exchange
is proposing to amend the table in
Section 5 to reflect the current per
connection fees for connectivity with
the primary and secondary facilities by
labelling the heading of the columns
reflecting such fees as ‘‘Primary/
Secondary Facility’’ for a 1 Gb, 10 Gb
and 10 Gb ULL connection,
respectively.
The Exchange is proposing to add
new columns to the table in Section 5
with the heading ‘‘Disaster Recovery
Facility’’ to set forth the monthly per
connection fees for a 1 Gb and 10 Gb
connection to the Disaster Recovery
Facility. Specifically, the Exchange
proposes a monthly per connection
Network Connectivity Fee of $500 for
each 1 Gb connection to the Disaster
Recovery Facility and a monthly per
connection Network Connectivity Fee of
$2,500 for each 10 Gb connection to the
Disaster Recovery Facility for both
Members and Non-Members. The
Exchange does not propose to offer a 10
Gb ULL connection to the Disaster
Recovery Facility at this time; the 10 Gb
ULL fees will therefore remain
unchanged. The Exchange proposes to
amend the tables in Sections 5(a) and (b)
to reflect this.
The Exchange believes that the
proposed pricing for connectivity to the
Disaster Recovery Facility is reflective
of the value it will provide to users of
the Exchange. The Exchange further
believes that the assessment of
connectivity fees to the Disaster
Recovery Facility will assist the
Exchange in recouping some of the costs
to the Exchange associated with
developing and maintaining this facility
for disaster recovery use. Not charging
users a testing and certification fee for
testing required in order to connect to
the Disaster Recovery Facility should
encourage Members and Non-Members
to connect to such facility. The
Exchange notes that other exchanges
charge fees for connection to their
Disaster Recovery facilities by their
market participants.7
The Exchange proposes to implement
the proposed changes to the Fee
Schedule effective as of September 16,
2016.
2. Statutory Basis
The Exchange believes that its
proposal to amend its Fee Schedule is
7 See Chicago Board Options Exchange,
Incorporated (‘‘CBOE’’) Fees Schedule, p. 13; see
also NASDAQ PHLX LLC (‘‘Phlx’’) Pricing
Schedule, Section XI [sic].
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Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Notices
consistent with Section 6(b) of the Act 8
in general, and furthers the objectives of
Section 6(b)(4) of the Act 9 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 or system which the Exchange
operates or controls. The Exchange also
believes the proposal furthers the
objectives of Section 6(b)(5) of the Act 10
in that it is designed to promote just and
equitable principles of trade, to remove
impediments to and perfect the
mechanism of a free and open market
and a national market system, and, in
general to protect investors and the
public interest and is not designed to
permit unfair discrimination between
customers, issuers, brokers and dealers.
The Exchange believes that its
proposal is consistent with Section
6(b)(4) of the Act because the fees
assessed for the connectivity to the
Disaster Recovery Facility will allow the
Exchange to cover certain of the costs
associated with maintaining these
Facility for disaster recovery use by
users of the Exchange. The Exchange
believes that the proposal to establish
fees for the Disaster Recovery Facility
connectivity is fair, equitable and not
unreasonably discriminatory because
the fees are assessed equally among all
users according to the bandwidth that
such user determines is the best suited
for its purposes, i.e., either 1 Gb or 10
Gb, and how many connections such
Users require.
The Exchange believes that the
Exchange’s decision not to charge
Member and Non-Member network
connectivity testing and certification
fees for testing required in order to
connect to the Disaster Recovery
Facility is consistent with Section
6(b)(4) of the Act because it will
encourage Members and Non-Members
to set up the connections to such
Facility for disaster recovery purposes.
Therefore, the Exchange believes that it
is reasonable not to charge Members and
Non-Members for testing and
certification in relation to connecting to
the Disaster Recovery Facility.
The Exchange also believes the
proposed Disaster Recovery Facility
connectivity fees are equitably allocated
in that all Members and Non-Members
will be charged the same amount to
cover the connection costs depending
on the speed of the connection as well
as the number of connections selected
by such user. All Members and NonMembers may subscribe to this
8 15
U.S.C. 78f(b).
U.S.C. 78f(b)(4).
10 15 U.S.C. 78f(b)(5).
connectivity to the Disaster Recovery
Facility, and the Exchange is not
eliminating any existing connectivity.
The Exchange also believes that its
proposal is consistent with the
objectives of Section 6(b)(5) of the Act 11
because the Disaster Recovery Facility
connectivity will be beneficial to all
MIAX participants. The Exchange
anticipates that providing the
opportunity to connect to the Disaster
Recovery Facility to all users of the
Exchange will further enhance the
Exchange’s support of risk management
in the form of disaster recovery on
behalf of its Member and Non-Member
users.
The Exchange also believes that
providing connectivity testing and
certification at no cost for the Disaster
Recovery Facility is consistent with
Section 6(b)(5) of the Act because it is
being offered to all MIAX participants at
no cost. There is no differentiation
among MIAX participants with regard to
the testing and certification required to
receive the disaster recovery services
through the Disaster Recovery Facility.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will result in
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. On the
contrary, the Exchange believes that the
proposed changes should increase both
intermarket and intramarket
competition. Specifically, the Exchange
believes that the changes will promote
competition by offering MIAX
participants more flexibility in their
choice of disaster recovery services,
which will in turn enhance their trading
operations and ultimately bring greater
efficiency to trading in the marketplace.
As to 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. In such an environment, the
Exchange must continually adjust its
fees to remain competitive with other
exchanges. The Exchange believes that
the proposed changes reflect this
competitive environment and may
result in enhanced services to a market
participant. Given the robust
competition among options markets for
the services that they each offer to
market participants, expanding and
thereby enhancing the services available
on MIAX is consistent with the goals of
the Act.
9 15
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18:51 Sep 28, 2016
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act,12 and Rule
19b–4(f)(2) 13 thereunder. At any time
within 60 days of the filing of the
proposed rule change, the Commission
summarily may temporarily suspend
such rule change if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act. If the Commission
takes such action, the Commission shall
institute proceedings 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 (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
MIAX–2016–32 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–MIAX–2016–32. This file
number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://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
12 15
11 15
Jkt 238001
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U.S.C. 78f(b)(5).
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U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
29SEN1
Federal Register / Vol. 81, No. 189 / Thursday, September 29, 2016 / Notices
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–MIAX–
2016–32 and should be submitted on or
before October 20, 2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Brent J. Fields,
Secretary.
[FR Doc. 2016–23497 Filed 9–28–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–78912; File No. SR–
NASDAQ–2016–130]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend
Nasdaq’s Fees at Rule 7014(f)
September 23, 2016.
mstockstill on DSK3G9T082PROD with NOTICES
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
September 16, 2016, The NASDAQ
Stock Market LLC (‘‘Nasdaq’’ 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.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
Exchange’s fees at Rule 7014(f) to: (i)
14 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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Change the criteria required to receive
the rebates provided by the Lead Market
Maker (‘‘LMM’’) Program; (ii) change the
rebates offered by the LMM Program;
and (iii) rename the program the
Designated Liquidity Provider (‘‘DLP’’)
Program, as described further below.
While these amendments are effective
upon filing, the Exchange has
designated the proposed amendments to
be operative on October 3, 2016.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://nasdaq.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: (i) Change the criteria
required to receive the rebates provided
by the LMM Program; (ii) change the
rebates offered by the LMM Program;
and (iii) rename the program the
Designated Liquidity Provider Program.
The LMM Program is designed to
provide incentives to market makers to
make markets in certain exchangetraded products (‘‘ETPs’’). To achieve
this goal, Nasdaq provides credits to a
designated LMM for execution of a
Qualified Security. Under Rule
7014(f)(1), a Qualified Security is
defined as an exchange-traded fund or
index-linked security listed on Nasdaq
pursuant to Nasdaq Rules 5705
(Exchange Traded Funds: Portfolio
Depository Receipts and Index Fund
Shares), 5710 (Securities Linked to the
Performance of Indexes and
Commodities, Including Currencies),
5720 (Trust Issued Receipts), 5735
(Managed Fund Shares), or 5745
(NextShares), and it must have at least
one LMM.
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67019
An LMM is a registered Nasdaq
market maker for a Qualified Security
that has committed to maintain
minimum performance standards. An
LMM is selected by Nasdaq based on
several factors including, but not
limited to, experience with making
markets in exchange-traded funds and
index-linked securities, adequacy of
capital, willingness to promote Nasdaq
as a marketplace, issuer preference,
operational capacity, support personnel,
and history of adherence to Nasdaq
rules and securities laws. Nasdaq may
limit the number of LMMs in a security,
or modify a previously established limit,
upon prior written notice to members.
Rule 7014(f)(4) sets forth the criteria
required, and the rebates and reduced
fees provided, by the LMM Program.
Currently, there are three tiers based on
the amount of time an LMM is at the
national best bid and offer (‘‘NBBO’’).
Specifically, if an LMM is above 15% to
20% at the NBBO, it qualifies for: (i) A
Displayed Liquidity Rebate (for
executions $1 per share and above) of
$0.0040 per executed share; (ii) a
Displayed Liquidity Rebate (for
executions less than $1 per share) of
$0.0000 per executed share; and (iii) a
maximum fee of $0.0005 per executed
share for participation in the Halt,
Opening, and Closing Crosses.3 If an
LMM is above 20% to 50% at the
NBBO, it qualifies for: (i) A Displayed
Liquidity Rebate (for executions $1 per
share and above) of $0.0043 per
executed share; (ii) a Displayed
Liquidity Rebate (for executions less
than $1 per share) of $0.0000 per
executed share; and (iii) a maximum fee
of $0.0000 per executed share for
participation in the Halt, Opening, and
Closing Crosses. Last, if an LMM is
above 50% at the NBBO, it qualifies for:
(i) A Displayed Liquidity Rebate (for
executions $1 per share and above) of
$0.0046 per executed share; (ii) a
Displayed Liquidity Rebate (for
executions less than $1 per share) of
$0.0000 per executed share; and (iii) a
maximum fee of $0.0000 per executed
share for participation in the Halt,
Opening, and Closing Crosses.
The Exchange is proposing to amend
the rebates and criteria under the
program to also take into consideration
certain characteristics of the individual
ETP.
3 A member participating in the Halt Cross would
otherwise be assessed a fee of $0.0010 per share
executed (see Rule 7018(f)). A member participating
in the Opening Cross would otherwise be assessed
a fee of no less than $0.0008 per share executed (see
Rule 7018(e)). A member participating in the
Closing Cross would otherwise be assessed a fee of
no less than $0.0008 per share executed (see Rule
7018(d)).
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]]>Agencies
[Federal Register Volume 81, Number 189 (Thursday, September 29, 2016)]
[Notices]
[Pages 67016-67019]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-23497]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-78919; File No. SR-MIAX-2016-32]
Self-Regulatory Organizations; Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change To Amend Its Fee Schedule To Modify the Exchange's
Connectivity Fees
September 23, 2016.
Pursuant to the provisions of Section 19(b)(1) of the Securities
Exchange Act
[[Page 67017]]
of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby
given that on September 12, 2016, Miami International Securities
Exchange LLC (``MIAX'' or ``Exchange'') filed with the Securities and
Exchange Commission (``Commission'') a 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 is filing a proposal to amend the MIAX Options Fee
Schedule (the ``Fee Schedule'') to modify the Exchange's connectivity
fees.
The text of the proposed rule change is available on the Exchange's
Web site at https://www.miaxoptions.com/filter/wotitle/rule_filing, at
MIAX's principal office, 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 its Fee Schedule regarding
connectivity to the Exchange. Specifically, the Exchange proposes to
amend Section 4 of the Fee Schedule, Testing and Certification Fees, to
state that Member and Non-Member Network Connectivity Testing and
Certification Fees will not be assessed for testing and certification
of connectivity to the Exchange's disaster recovery systems (for
purposes of the Fee Schedule, the ``Disaster Recovery Facility'').\3\
The Exchange also proposes to amend Section 5 of the Fee Schedule,
System Connectivity Fees, to establish a new connectivity fee for 1
Gigabit (``Gb'') and 10 Gb fiber connections to the Exchange's Disaster
Recovery Facility.
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\3\ See Exchange Rule 321. See also, Securities Exchange Act
Release No. 76303 (October 29, 2015), 80 FR 68373 (November 4, 2015)
(SR-MIAX-2015-61).
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Testing and Certification Fees
The Exchange currently offers various bandwidth alternatives for
connectivity to the Exchange's System,\4\ including a 10 Gb fiber
connection, a 1 Gb fiber connection and a 10 Gb ultra-low latency
(``ULL'') fiber connection. The Exchange currently assesses a Member
Network Connectivity Testing and Certification Fee of $1,000 for each 1
Gb connection, and $4,000 for each 10 Gb or 10 Gb ULL connection.\5\
Non-Members are assessed a Non-Member Network Connectivity Testing and
Certification Fee of $1,200 for each 1 Gb connection, and $4,200 for
each 10 Gb or 10 Gb ULL connection.\6\ The Exchange proposes to amend
Sections 4(c) and 4(d) of the Fee Schedule to state that these Member
and Non-Member Network Connectivity Testing and Certification Fees will
not be assessed for testing and certification of connectivity to the
Exchange's Disaster Recovery Facility.
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\4\ The term ``System'' means the automated trading system used
by the Exchange for the trading of securities. See Exchange Rule
100.
\5\ See Fee Schedule Section 4(c).
\6\ See Fee Schedule Section 4(d).
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The purpose of the Exchange's proposal not to charge Member and
Non-Member network connectivity testing and certification fees for
testing required in order to connect to the Disaster Recovery Facility
is to eliminate any potential impediment to Members and Non-Members in
testing and certifying for connectivity to the Disaster Recovery
Facility, and to encourage Members and Non-Members to set up the
connections to such Facility for disaster recovery purposes.
System Connectivity Fees
The Exchange currently assesses Monthly Member Network Connectivity
fees for the applicable connectivity in any month when a Member or Non-
Member is credentialed to use any of the MIAX APIs or Market Data feeds
in the production environment.
The Exchange proposes to amend the table in Section 5 of the Fee
Schedule to explicitly reflect the monthly Member and Non-Member
Network connectivity fees as they apply to the Exchange's primary and
secondary facilities, and to the Exchange's Disaster Recovery Facility.
Under the proposal, fees for connectivity to the Exchange's primary and
secondary (i.e., backup) facilities will remain unchanged. The Exchange
is proposing to amend the table in Section 5 to reflect the current per
connection fees for connectivity with the primary and secondary
facilities by labelling the heading of the columns reflecting such fees
as ``Primary/Secondary Facility'' for a 1 Gb, 10 Gb and 10 Gb ULL
connection, respectively.
The Exchange is proposing to add new columns to the table in
Section 5 with the heading ``Disaster Recovery Facility'' to set forth
the monthly per connection fees for a 1 Gb and 10 Gb connection to the
Disaster Recovery Facility. Specifically, the Exchange proposes a
monthly per connection Network Connectivity Fee of $500 for each 1 Gb
connection to the Disaster Recovery Facility and a monthly per
connection Network Connectivity Fee of $2,500 for each 10 Gb connection
to the Disaster Recovery Facility for both Members and Non-Members. The
Exchange does not propose to offer a 10 Gb ULL connection to the
Disaster Recovery Facility at this time; the 10 Gb ULL fees will
therefore remain unchanged. The Exchange proposes to amend the tables
in Sections 5(a) and (b) to reflect this.
The Exchange believes that the proposed pricing for connectivity to
the Disaster Recovery Facility is reflective of the value it will
provide to users of the Exchange. The Exchange further believes that
the assessment of connectivity fees to the Disaster Recovery Facility
will assist the Exchange in recouping some of the costs to the Exchange
associated with developing and maintaining this facility for disaster
recovery use. Not charging users a testing and certification fee for
testing required in order to connect to the Disaster Recovery Facility
should encourage Members and Non-Members to connect to such facility.
The Exchange notes that other exchanges charge fees for connection to
their Disaster Recovery facilities by their market participants.\7\
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\7\ See Chicago Board Options Exchange, Incorporated (``CBOE'')
Fees Schedule, p. 13; see also NASDAQ PHLX LLC (``Phlx'') Pricing
Schedule, Section XI [sic].
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The Exchange proposes to implement the proposed changes to the Fee
Schedule effective as of September 16, 2016.
2. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is
[[Page 67018]]
consistent with Section 6(b) of the Act \8\ in general, and furthers
the objectives of Section 6(b)(4) of the Act \9\ 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 or system which the Exchange operates or controls. The
Exchange also believes the proposal furthers the objectives of Section
6(b)(5) of the Act \10\ in that it is designed to promote just and
equitable principles of trade, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general to protect investors and the public interest and is not
designed to permit unfair discrimination between customers, issuers,
brokers and dealers.
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\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(4).
\10\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that its proposal is consistent with Section
6(b)(4) of the Act because the fees assessed for the connectivity to
the Disaster Recovery Facility will allow the Exchange to cover certain
of the costs associated with maintaining these Facility for disaster
recovery use by users of the Exchange. The Exchange believes that the
proposal to establish fees for the Disaster Recovery Facility
connectivity is fair, equitable and not unreasonably discriminatory
because the fees are assessed equally among all users according to the
bandwidth that such user determines is the best suited for its
purposes, i.e., either 1 Gb or 10 Gb, and how many connections such
Users require.
The Exchange believes that the Exchange's decision not to charge
Member and Non-Member network connectivity testing and certification
fees for testing required in order to connect to the Disaster Recovery
Facility is consistent with Section 6(b)(4) of the Act because it will
encourage Members and Non-Members to set up the connections to such
Facility for disaster recovery purposes. Therefore, the Exchange
believes that it is reasonable not to charge Members and Non-Members
for testing and certification in relation to connecting to the Disaster
Recovery Facility.
The Exchange also believes the proposed Disaster Recovery Facility
connectivity fees are equitably allocated in that all Members and Non-
Members will be charged the same amount to cover the connection costs
depending on the speed of the connection as well as the number of
connections selected by such user. All Members and Non-Members may
subscribe to this connectivity to the Disaster Recovery Facility, and
the Exchange is not eliminating any existing connectivity.
The Exchange also believes that its proposal is consistent with the
objectives of Section 6(b)(5) of the Act \11\ because the Disaster
Recovery Facility connectivity will be beneficial to all MIAX
participants. The Exchange anticipates that providing the opportunity
to connect to the Disaster Recovery Facility to all users of the
Exchange will further enhance the Exchange's support of risk management
in the form of disaster recovery on behalf of its Member and Non-Member
users.
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\11\ 15 U.S.C. 78f(b)(5).
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The Exchange also believes that providing connectivity testing and
certification at no cost for the Disaster Recovery Facility is
consistent with Section 6(b)(5) of the Act because it is being offered
to all MIAX participants at no cost. There is no differentiation among
MIAX participants with regard to the testing and certification required
to receive the disaster recovery services through the Disaster Recovery
Facility.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. On the contrary,
the Exchange believes that the proposed changes should increase both
intermarket and intramarket competition. Specifically, the Exchange
believes that the changes will promote competition by offering MIAX
participants more flexibility in their choice of disaster recovery
services, which will in turn enhance their trading operations and
ultimately bring greater efficiency to trading in the marketplace.
As to 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. In such an environment, the Exchange must continually
adjust its fees to remain competitive with other exchanges. The
Exchange believes that the proposed changes reflect this competitive
environment and may result in enhanced services to a market
participant. Given the robust competition among options markets for the
services that they each offer to market participants, expanding and
thereby enhancing the services available on MIAX is consistent with the
goals of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\12\ and Rule 19b-4(f)(2) \13\ thereunder.
At any time within 60 days of the filing of the proposed rule change,
the Commission summarily may temporarily suspend such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act. If the Commission takes such
action, the Commission shall institute proceedings to determine whether
the proposed rule should be approved or disapproved.
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\12\ 15 U.S.C. 78s(b)(3)(A)(ii).
\13\ 17 CFR 240.19b-4(f)(2).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-MIAX-2016-32 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-MIAX-2016-32. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://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
[[Page 67019]]
proposed rule change between the Commission and any person, other than
those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549 on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-MIAX-2016-32 and should be
submitted on or before October 20, 2016.
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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Brent J. Fields,
Secretary.
[FR Doc. 2016-23497 Filed 9-28-16; 8:45 am]
BILLING CODE 8011-01-P
