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 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 (http://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 (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 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 http:// 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 (http://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 (http://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 http:// www.directedge.com, on the Commission’s Web site at http://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]


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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 http://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 (http://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 (http://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.
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    \12\ The text of the proposed rule change is available on 
Exchange's Web site at http://www.directedge.com, on the 
Commission's Web site at http://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\
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    \13\ 17 CFR 200.30-3(a)(12).
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Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-2950 Filed 2-9-11; 8:45 am]
BILLING CODE 8011-01-P