Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Amendments to the EDGX Exchange, Inc. Fee Schedule, 7620-7622 [2011-2950]
Download as PDF
<![CDATA[
7620
Federal Register / Vol. 76, No. 28 / Thursday, February 10, 2011 / Notices
basis of whether they opt to direct
orders to the Exchange and thereby
make use of its order execution services.
In particular, the Exchange notes that
the proposed fees are consistent with
Rule 610(c) under Regulation NMS,6
which found that fees not in excess of
$0.0030 per share executed would
promote the objective of equal
regulation and preventing excessive
fees. As the Commission determined in
that matter, competition is best able to
determine whether a strategy of
charging fees set at lower levels, or of
charging a higher fee and paying a
higher rebate, will be successful.7
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, as amended.
Because the market for order execution
and routing is extremely competitive,
members may readily favor the
Exchange’s competitors in making order
routing decisions to the extent that they
deem PSX’s fees to be excessive.
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 e-mail to rulecomments@sec.gov. Please include File
Number SR–Phlx–2011–11 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
IV. Solicitation of Comments
All submissions should refer to File
Number SR–Phlx–2011–11. This file
number should be included on the
subject line if e-mail 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
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 on official business
days between the hours of 10 a.m. and
3 p.m. Copies of such filing also will be
available for inspection and copying at
the principal offices 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–Phlx–2011–11, and should
be submitted on or before March 3,
2011.
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.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Cathy H. Ahn,
Deputy Secretary.
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
jdjones on DSK8KYBLC1PROD with NOTICES
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act.8 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.
6 17
CFR 242.610(c).
Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496, 37596 (June 29, 2005).
8 15 U.S.C. 78s(b)(3)(A)(ii).
7 Securities
VerDate Mar<15>2010
15:10 Feb 09, 2011
Jkt 223001
[FR Doc. 2011–2951 Filed 2–9–11; 8:45 am]
BILLING CODE 8011–01–P
9 17
PO 00000
CFR 200.30–3(a)(12).
Frm 00090
Fmt 4703
Sfmt 4703
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–63837; File No. SR–EDGX–
2011–03]
Self-Regulatory Organizations; EDGX
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Relating to Amendments
to the EDGX Exchange, Inc. Fee
Schedule
February 3, 2011.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on February
1, 2011, the EDGX Exchange, Inc. (the
‘‘Exchange’’ or the ‘‘EDGX’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which items
have been prepared by the selfregulatory organization. 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 its
fees and rebates applicable to Members 3
of the Exchange pursuant to EDGX Rule
15.1(a) and (c). All of the changes
described herein are applicable to EDGX
Members. The text of the proposed rule
change is available on the Exchange’s
Internet Web site at https://
www.directedge.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of these statements may be examined at
the places specified in Item IV below.
The self-regulatory organization has
prepared summaries, set forth in
sections A, B and C below, of the most
significant aspects of such statements.
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 A Member is any registered broker or dealer, or
any person associated with a registered broker or
dealer, that has been admitted to membership in the
Exchange.
2 17
E:\FR\FM\10FEN1.SGM
10FEN1
Federal Register / Vol. 76, No. 28 / Thursday, February 10, 2011 / Notices
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
jdjones on DSK8KYBLC1PROD with NOTICES
1. Purpose
In SR–EDGX–2010–10,4 the Exchange
filed for immediate effectiveness a rule
filing to charge for legacy ISE 5 Financial
Information Exchange (‘‘FIX’’) sessions
(‘‘Sessions’’) used to connect to EDGX
and thereby, amended its fee schedule
accordingly.6 These Sessions are logical
ports used to enter orders into the
Exchange’s trading system and to
receive order messages from the
Exchange. The Sessions are currently
being used to send orders to EDGX by
certain legacy Members of the ISE who
became Members of EDGX. The
amendment to the fee schedule enabled
the Exchange to continue to bill
Members for these Sessions until they
are terminated.
The Exchange notes that all Members
have transitioned their order entry to
other ports and no firms currently send
orders over ISE FIX sessions as of
February 1, 2011. Therefore, effective
February 1, 2011, the Exchange will be
discontinuing the ISE FIX sessions as all
Members of EDGX that previously used
ISE FIX sessions have transitioned to
their Direct EDGX Sessions.
In SR–EDGX–2011–01, the Exchange
added the ROOC routing option in Rule
11.9(b)(3)(p) for orders that the entering
firm wishes to designate for
participation in the opening or closing
process of a primary listing market
(NYSE, Nasdaq, NYSE Amex, or NYSE
Arca) if received before the opening/
closing time of such market. If shares
remain unexecuted after attempting to
execute in the opening or closing
process, they are either posted to the
book, executed, or routed like a ROUT
routing option, as described in Rule
11.9(b)(3)(h). In this filing, the Exchange
proposes to add the corresponding flags
for the use of the ROOC strategy to its
4 See Securities Exchange Act Release No. 62640
(August 4, 2010), 75 FR 48734 (August 11, 2010)
(SR–EDGX–2010–10).
5 A wholly-owned subsidiary of Direct Edge
Holdings, LLC (prior to July 16, 2010) previously
operated the ISE Stock Exchange as a facility of ISE.
These Session fees are identical to the fees filed
previously filed by and billed for by the ISE. See
Securities Exchange Act Release No. 56379
(September 10, 2007), 72 FR 52591 (September 14,
2007) (SR–ISE–2007–79).
6 As stated in SR–ISE–2007–79, the ISE used the
FIX protocol, which Members program to in order
to develop applications that send trading
commands and/or queries to and receive broadcasts
and/or transactions from the trading system. The
protocol processes quotes, receives orders from
Members, tracks activity in the underlying markets,
when applicable, executes trades in the matching
engine, and broadcasts trade details to participating
Members.
VerDate Mar<15>2010
15:10 Feb 09, 2011
Jkt 223001
fee schedule and assign corresponding
fees. If the entering firm wishes the
order to participate in the listing market
close via the ROOC strategy, it will be
assigned a flag of ‘‘CL’’ and a fee of
$0.0010 per share, except for NYSE
Arca. This fee represents a blended rate
of all four primary listing market fees for
participation in the market close. For
ease of administration, the Exchange
uses this blended rate as it represents an
average fee from the primary listing
markets. However, a flag of ‘‘O’’ will be
yielded and the associated fee for the
‘‘O’’ flag, $0.0005 per share, will be
assessed, if the order is routed to the
NYSE Arca closing process. This is
clarified in proposed footnote 9 to the
fee schedule and represents a pass
through of the NYSE Arca fee. If the
entering firm wishes to designate that
the order participate in the opening
process of NYSE Amex and it adds
liquidity, it will be assigned a flag of ‘‘8’’
and a rebate of $0.0015 per share. This
rebate represents a pass through of the
NYSE Amex rebate. If the entering firm
wishes to designate that the order
participate in the opening process of
NYSE Arca and it adds liquidity, it will
be assigned a flag of ‘‘9’’ and a rebate of
$0.0021 per share. This rebate
represents a pass through of the NYSE
Arca rebate. The Exchange proposes to
add these flags effective February 1,
2011 but not implement them until the
ROOC strategy is effective, which is on
or about February 14, 2011.
Currently, the ‘‘K’’ flag is yielded
when an order is routed to BATS BZX
Exchange using the ROBA order type.
The Exchange proposes that this flag be
yielded and its associated fee of $0.0025
per share be assessed when an order is
routed to Nasdaq PSX using the ROUC
order type, as defined in Rule
11.9(b)(3)(a).7 This fee of $0.0025 per
share represents a pass through of the
Nasdaq PSX rate.
Currently, stocks priced below $1.00
are charged 0.20% of the dollar value of
the transaction when routed to Nasdaq
and removing liquidity in securities on
all Tapes, as noted in footnote 3 of the
fee schedule and as indicated on
corresponding flag J. The Exchange
proposes to increase this fee to 0.30% of
the dollar value of the transaction to
reflect an increase in rate provided by
Nasdaq, effective January 3, 2011.
EDGX Exchange proposes to
implement these amendments to the
7 Rule 11.9(b)(3)(a) defines the ROUC order type
as a routing option under which an order checks the
System for available shares, and then is sent
sequentially to destinations on the System routing
table, Nasdaq OMX BX, and NYSE. If shares remain
unexecuted after routing, they are posted on the
Exchange’s book.
PO 00000
Frm 00091
Fmt 4703
Sfmt 4703
7621
Exchange fee schedule on February 1,
2011.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the objectives of Section 6 of the Act,8
in general, and furthers the objectives of
Section 6(b)(4),9 in particular, as it is
designed to provide for the equitable
allocation of reasonable dues, fees and
other charges among its members and
other persons using its facilities.
The Exchange believes that the fees
associated with the new flags described
above represent an equitable allocation
of reasonable dues, fees, and other
charges. The fee associated with the
‘‘CL’’ flag ($0.0010) (except for NYSE
Arca) represents a blended rate of all
four primary listing market fees for
participation in the market close.
However, a flag of ‘‘O’’ will be yielded
and the associated fee for the ‘‘O’’ flag,
$0.0005 per share, will be assessed, if
the order is routed to the NYSE Arca
closing process. This represents a pass
through of the NYSE Arca fee. If the
entering firm wishes to designate that
the order participate in the opening
process of NYSE Amex and it adds
liquidity, it will be assigned a flag of ‘‘8’’
and a rebate of $0.0015 per share. This
rebate represents a pass through of the
NYSE Amex rebate. If the entering firm
wishes to designate that the order
participate in the opening process of
NYSE Arca and it adds liquidity, it will
be assigned a flag of ‘‘9’’ and a rebate of
$0.0021 per share. This rebate also
represents a pass through of the NYSE
Arca rebate. The fee associated with the
K flag ($0.0025 per share) also
represents a pass through of the Nasdaq
PSX rate. In addition, as discussed
above, stocks priced below $1.00 are
now proposed to be charged 0.30% of
the dollar value of the transaction when
routed to Nasdaq and removing
liquidity in securities on all Tapes, as
noted in proposed footnote 3 of the fee
schedule. This increase in fee (from
0.20% of the dollar value of the
transaction) reflects a pass through of
the Nasdaq’s increased rate, effective
January 3, 2011.
The Exchange notes that it operates in
a highly competitive market in which
market participants can readily direct
order flow to competing venues if they
deem fee levels at a particular venue to
be excessive. The proposed rule change
reflects a competitive pricing structure
designed to incent market participants
to direct their order flow to the
Exchange. The Exchange believes that
8 15
9 15
E:\FR\FM\10FEN1.SGM
U.S.C. 78f.
U.S.C. 78f(b)(4).
10FEN1
7622
Federal Register / Vol. 76, No. 28 / Thursday, February 10, 2011 / Notices
the proposed rates are equitable in that
they apply uniformly to all Members.
The Exchange believes the fees and
credits remain competitive with those
charged by other venues and therefore
continue to be reasonable and equitably
allocated to Members.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The proposed rule change does not
impose any burden on competition that
is not necessary or appropriate in
furtherance of the purposes of the Act.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
members or other interested parties.
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) of
the Act 10 and Rule 19b–4(f)(2) 11
thereunder. At any time within 60 days
of the filing of such 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.
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
jdjones on DSK8KYBLC1PROD with NOTICES
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
11 17
U.S.C. 78s(b)(3)(A).
CFR 19b–4(f)(2).
VerDate Mar<15>2010
15:10 Feb 09, 2011
Incident: Severe Storms and Flooding.
Incident Period: 12/12/2010 through
12/19/2010.
DATES: Effective Date: 02/01/2011.
Physical Loan Application Deadline
Date: 04/04/2011.
Economic Injury (EIDL) Loan
Application Deadline Date: 11/01/2011.
ADDRESSES: Submit completed loan
applications to: U.S. Small Business
Administration, Processing and
Disbursement Center, 14925 Kingsport
Road, Fort Worth, TX 76155.
FOR FURTHER INFORMATION CONTACT: A.
Escobar, Office of Disaster Assistance,
U.S. Small Business Administration,
409 3rd Street, SW., Suite 6050,
Washington, DC 20416.
SUPPLEMENTARY INFORMATION: Notice is
hereby given that as a result of the
President’s major disaster declaration on
02/01/2011, Private Non-Profit
organizations that provide essential
services of governmental nature may file
disaster loan applications at the address
listed above or other locally announced
locations.
The following areas have been
determined to be adversely affected by
the disaster:
Primary Counties: Aroostook;
Piscataquis; Washington. And the
Tribal Lands of the Passamaquoddy
Tribe located entirely within
Washington County.
The Interest Rates are:
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Cathy H. Ahn,
Deputy Secretary.
For Physical Damage:
Non-Profit Organizations With
Credit Available Elsewhere ..
Non-Profit Organizations Without Credit Available Elsewhere: ..................................
For Economic Injury:
Non-Profit Organizations Without Credit Available Elsewhere: ..................................
[FR Doc. 2011–2950 Filed 2–9–11; 8:45 am]
BILLING CODE 8011–01–P
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration # 12461 and # 12462]
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–EDGX–2011–03 on the
subject line.
10 15
All submissions should refer to File
Number SR–EDGX–2011–03. This file
number should be included on the
subject line if e-mail 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,12 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 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
a.m. and 3 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–EDGX–
2011–03 and should be submitted on or
before March 3, 2011.
Jkt 223001
Maine Disaster # ME–00028
U.S. Small Business
Administration.
ACTION: Notice.
This is a Notice of the
Presidential declaration of a major
disaster for Public Assistance Only for
the State of Maine (FEMA–1953–DR),
dated 02/01/2011.
SUMMARY:
12 The text of the proposed rule change is
available on Exchange’s Web site at https://
www.directedge.com, on the Commission’s Web site
at https://www.sec.gov, at EDGX, and at the
Commission’s Public Reference Room.
13 17 CFR 200.30–3(a)(12).
Frm 00092
Fmt 4703
Sfmt 4703
3.250
3.000
3.000
The number assigned to this disaster
for physical damage is 12461B and for
economic injury is 12462B.
(Catalog of Federal Domestic Assistance
Numbers 59002 and 59008)
AGENCY:
PO 00000
Percent
James E. Rivera,
Associate Administrator for Disaster
Assistance.
[FR Doc. 2011–2977 Filed 2–9–11; 8:45 am]
BILLING CODE 8025–01–P
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration #12459 and #12460]
California Disaster #CA–00162
U.S. Small Business
Administration.
AGENCY:
E:\FR\FM\10FEN1.SGM
10FEN1
]]>Agencies
[Federal Register Volume 76, Number 28 (Thursday, February 10, 2011)]
[Notices]
[Pages 7620-7622]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-2950]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63837; File No. SR-EDGX-2011-03]
Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Relating to
Amendments to the EDGX Exchange, Inc. Fee Schedule
February 3, 2011.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on February 1, 2011, the EDGX Exchange, Inc. (the ``Exchange'' or
the ``EDGX'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend its fees and rebates applicable to
Members \3\ of the Exchange pursuant to EDGX Rule 15.1(a) and (c). All
of the changes described herein are applicable to EDGX Members. The
text of the proposed rule change is available on the Exchange's
Internet Web site at https://www.directedge.com.
---------------------------------------------------------------------------
\3\ A Member is any registered broker or dealer, or any person
associated with a registered broker or dealer, that has been
admitted to membership in the Exchange.
---------------------------------------------------------------------------
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in sections A, B and C below, of the
most significant aspects of such statements.
[[Page 7621]]
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
In SR-EDGX-2010-10,\4\ the Exchange filed for immediate
effectiveness a rule filing to charge for legacy ISE \5\ Financial
Information Exchange (``FIX'') sessions (``Sessions'') used to connect
to EDGX and thereby, amended its fee schedule accordingly.\6\ These
Sessions are logical ports used to enter orders into the Exchange's
trading system and to receive order messages from the Exchange. The
Sessions are currently being used to send orders to EDGX by certain
legacy Members of the ISE who became Members of EDGX. The amendment to
the fee schedule enabled the Exchange to continue to bill Members for
these Sessions until they are terminated.
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release No. 62640 (August 4,
2010), 75 FR 48734 (August 11, 2010) (SR-EDGX-2010-10).
\5\ A wholly-owned subsidiary of Direct Edge Holdings, LLC
(prior to July 16, 2010) previously operated the ISE Stock Exchange
as a facility of ISE. These Session fees are identical to the fees
filed previously filed by and billed for by the ISE. See Securities
Exchange Act Release No. 56379 (September 10, 2007), 72 FR 52591
(September 14, 2007) (SR-ISE-2007-79).
\6\ As stated in SR-ISE-2007-79, the ISE used the FIX protocol,
which Members program to in order to develop applications that send
trading commands and/or queries to and receive broadcasts and/or
transactions from the trading system. The protocol processes quotes,
receives orders from Members, tracks activity in the underlying
markets, when applicable, executes trades in the matching engine,
and broadcasts trade details to participating Members.
---------------------------------------------------------------------------
The Exchange notes that all Members have transitioned their order
entry to other ports and no firms currently send orders over ISE FIX
sessions as of February 1, 2011. Therefore, effective February 1, 2011,
the Exchange will be discontinuing the ISE FIX sessions as all Members
of EDGX that previously used ISE FIX sessions have transitioned to
their Direct EDGX Sessions.
In SR-EDGX-2011-01, the Exchange added the ROOC routing option in
Rule 11.9(b)(3)(p) for orders that the entering firm wishes to
designate for participation in the opening or closing process of a
primary listing market (NYSE, Nasdaq, NYSE Amex, or NYSE Arca) if
received before the opening/closing time of such market. If shares
remain unexecuted after attempting to execute in the opening or closing
process, they are either posted to the book, executed, or routed like a
ROUT routing option, as described in Rule 11.9(b)(3)(h). In this
filing, the Exchange proposes to add the corresponding flags for the
use of the ROOC strategy to its fee schedule and assign corresponding
fees. If the entering firm wishes the order to participate in the
listing market close via the ROOC strategy, it will be assigned a flag
of ``CL'' and a fee of $0.0010 per share, except for NYSE Arca. This
fee represents a blended rate of all four primary listing market fees
for participation in the market close. For ease of administration, the
Exchange uses this blended rate as it represents an average fee from
the primary listing markets. However, a flag of ``O'' will be yielded
and the associated fee for the ``O'' flag, $0.0005 per share, will be
assessed, if the order is routed to the NYSE Arca closing process. This
is clarified in proposed footnote 9 to the fee schedule and represents
a pass through of the NYSE Arca fee. If the entering firm wishes to
designate that the order participate in the opening process of NYSE
Amex and it adds liquidity, it will be assigned a flag of ``8'' and a
rebate of $0.0015 per share. This rebate represents a pass through of
the NYSE Amex rebate. If the entering firm wishes to designate that the
order participate in the opening process of NYSE Arca and it adds
liquidity, it will be assigned a flag of ``9'' and a rebate of $0.0021
per share. This rebate represents a pass through of the NYSE Arca
rebate. The Exchange proposes to add these flags effective February 1,
2011 but not implement them until the ROOC strategy is effective, which
is on or about February 14, 2011.
Currently, the ``K'' flag is yielded when an order is routed to
BATS BZX Exchange using the ROBA order type. The Exchange proposes that
this flag be yielded and its associated fee of $0.0025 per share be
assessed when an order is routed to Nasdaq PSX using the ROUC order
type, as defined in Rule 11.9(b)(3)(a).\7\ This fee of $0.0025 per
share represents a pass through of the Nasdaq PSX rate.
---------------------------------------------------------------------------
\7\ Rule 11.9(b)(3)(a) defines the ROUC order type as a routing
option under which an order checks the System for available shares,
and then is sent sequentially to destinations on the System routing
table, Nasdaq OMX BX, and NYSE. If shares remain unexecuted after
routing, they are posted on the Exchange's book.
---------------------------------------------------------------------------
Currently, stocks priced below $1.00 are charged 0.20% of the
dollar value of the transaction when routed to Nasdaq and removing
liquidity in securities on all Tapes, as noted in footnote 3 of the fee
schedule and as indicated on corresponding flag J. The Exchange
proposes to increase this fee to 0.30% of the dollar value of the
transaction to reflect an increase in rate provided by Nasdaq,
effective January 3, 2011.
EDGX Exchange proposes to implement these amendments to the
Exchange fee schedule on February 1, 2011.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the objectives of Section 6 of the Act,\8\ in general, and
furthers the objectives of Section 6(b)(4),\9\ in particular, as it is
designed to provide for the equitable allocation of reasonable dues,
fees and other charges among its members and other persons using its
facilities.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f.
\9\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
The Exchange believes that the fees associated with the new flags
described above represent an equitable allocation of reasonable dues,
fees, and other charges. The fee associated with the ``CL'' flag
($0.0010) (except for NYSE Arca) represents a blended rate of all four
primary listing market fees for participation in the market close.
However, a flag of ``O'' will be yielded and the associated fee for the
``O'' flag, $0.0005 per share, will be assessed, if the order is routed
to the NYSE Arca closing process. This represents a pass through of the
NYSE Arca fee. If the entering firm wishes to designate that the order
participate in the opening process of NYSE Amex and it adds liquidity,
it will be assigned a flag of ``8'' and a rebate of $0.0015 per share.
This rebate represents a pass through of the NYSE Amex rebate. If the
entering firm wishes to designate that the order participate in the
opening process of NYSE Arca and it adds liquidity, it will be assigned
a flag of ``9'' and a rebate of $0.0021 per share. This rebate also
represents a pass through of the NYSE Arca rebate. The fee associated
with the K flag ($0.0025 per share) also represents a pass through of
the Nasdaq PSX rate. In addition, as discussed above, stocks priced
below $1.00 are now proposed to be charged 0.30% of the dollar value of
the transaction when routed to Nasdaq and removing liquidity in
securities on all Tapes, as noted in proposed footnote 3 of the fee
schedule. This increase in fee (from 0.20% of the dollar value of the
transaction) reflects a pass through of the Nasdaq's increased rate,
effective January 3, 2011.
The Exchange notes that it operates in a highly competitive market
in which market participants can readily direct order flow to competing
venues if they deem fee levels at a particular venue to be excessive.
The proposed rule change reflects a competitive pricing structure
designed to incent market participants to direct their order flow to
the Exchange. The Exchange believes that
[[Page 7622]]
the proposed rates are equitable in that they apply uniformly to all
Members. The Exchange believes the fees and credits remain competitive
with those charged by other venues and therefore continue to be
reasonable and equitably allocated to Members.
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
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) of the Act \10\ and Rule 19b-4(f)(2) \11\ thereunder. At any
time within 60 days of the filing of such 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.
---------------------------------------------------------------------------
\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 19b-4(f)(2).
---------------------------------------------------------------------------
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 e-mail to rule-comments@sec.gov. Please include
File Number SR-EDGX-2011-03 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-EDGX-2011-03. This file
number should be included on the subject line if e-mail 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,\12\ 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 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 a.m. and 3 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-
EDGX-2011-03 and should be submitted on or before March 3, 2011.
---------------------------------------------------------------------------
\12\ The text of the proposed rule change is available on
Exchange's Web site at https://www.directedge.com, on the
Commission's Web site at https://www.sec.gov, at EDGX, and at the
Commission's Public Reference Room.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
---------------------------------------------------------------------------
\13\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-2950 Filed 2-9-11; 8:45 am]
BILLING CODE 8011-01-P
