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, 27274-27276 [2013-11017]

Download as PDF 27274 Federal Register / Vol. 78, No. 90 / Thursday, May 9, 2013 / Notices and liquidity in the market for SPY and SPY options should mitigate the market fragmentation and price protection concerns that commenters raised.53 Moreover, the Commission notes that the proposal is limited to jumbo options on SPY and in order to expand the trading of jumbo options beyond those overlying SPY, BOX would be required to file new proposed rule changes with the Commission pursuant to Section 19(b) of the Act.54 Proposals to expand jumbo options to cover other underlying securities that do not exhibit the depth and liquidity of the SPY and SPY options markets potentially could give rise to concern. Finally, the Commission expects BOX to monitor the trading of Jumbo SPY Options to evaluate whether any issues develop. As a national securities exchange, the Exchange is required, under Section 6(b)(1) of the Act,55 to enforce compliance by its members and persons associated with its members with the provisions of the Act, Commission rules and regulations thereunder, and its own rules. In this regard, the Commission notes that the Exchange’s rules that apply to the trading of standard options would apply to Jumbo SPY Options. The Commission also notes that the Exchange’s existing market maker quoting obligations would apply to Jumbo SPY Options.56 In addition, the Commission notes that intermarket trade-through protection would apply to Jumbo SPY Options to the extent that they are traded on more than one market. IV. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,57 that the proposed rule change (SR–BOX–2013– 06) be, and hereby is, approved. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.58 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2013–11002 Filed 5–8–13; 8:45 am] mstockstill on DSK4VPTVN1PROD with NOTICES BILLING CODE 8011–01–P 53 See OCC Exchange Volume by Class, available at https://theocc.com/webapps/volbyclass-reports (indicating that SPY options are currently the most actively traded options in terms of volume). 54 See Notice, supra note 3, at n.5. 55 15 U.S.C. 78f(b)(1). 56 See BOX Rule 8050. 57 15 U.S.C. 78s(b)(2). 58 17 CFR 200.30–3(a)(12). VerDate Mar<15>2010 17:18 May 08, 2013 Jkt 229001 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–69510; File No. SR–EDGX– 2013–15] 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 May 3, 2013. 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 May 1, 2013, EDGX Exchange, Inc. (the ‘‘Exchange’’ or ‘‘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. 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 www.directedge.com, at the Exchange’s principal office, and at the Public Reference Room of the Commission. 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 As defined in Exchange Rule 1.5(n). 2 17 PO 00000 Frm 00097 Fmt 4703 Sfmt 4703 A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose In securities priced at or above $1.00, the Exchange currently provides a rebate of $0.0002 per share for Members’ orders that yield Flag BY, which routes to BATS BYX (‘‘BYX’’) and removes liquidity using routing strategies ROUC, ROUE, or ROBY.4 The Exchange proposes to amend its fee schedule to assess no charge (‘‘free’’) nor provide any rebate for Members’ orders that yield Flag BY. When Direct Edge ECN LLC (d/b/a DE Route) (‘‘DE Route’’), the Exchange’s affiliated routing brokerdealer, routes to BYX, it is rebated $0.0005 per share for adding an average daily volume of 50,000 shares per day on BYX.5 However, DE Route will pass through the non-tiered rate on BYX (no fee nor rebate) to the Exchange and the Exchange, in turn, will pass through no fee nor rebate to its Members.6 In securities priced at $1.00 or above, the Exchange currently assesses a charge of $0.0005 per share for Members’ orders that yield Flag RY, which routes to BYX and adds liquidity. The Exchange proposes to amend its fee schedule to increase the rate it charges Members from $0.0005 per share to $0.0007 per share for Flag RY. The proposed change represents a pass through of the rate that DE Route is charged for routing orders to BYX that do not qualify for additional volume tiered discounts.7 DE Route passes through the charge to the Exchange and the Exchange, in turn, passes through the charge to its Members. The Exchange notes that the proposed change is in response to BYX’s April 2013 fee filing with the Commission, wherein BYX increased the rate it charges its customers, such as DE Route, from a charge of $0.0005 per share to a charge of $0.0007 per share for orders 4 As defined in Exchange Rule 11.9(b)(2). Securities Exchange Act Release No. 69317 (April 5, 2013), 78 FR 21651 (April 11, 2013) (SR– BYX–2013–012) (amending the rebate BYX provides for removing liquidity from the BYX order book for executions by members that add a daily average volume of at least 50,000 shares from $0.0002 per share to $0.0005 per share). 6 The Exchange notes that to the extent DE Route does or does not achieve any volume tiered rebate on BYX, its rate for Flag BY will not change. See BYX Fee Schedule, https://cdn.batstrading.com/ resources/regulation/rule_book/BATSExchanges_Fee_Schedules.pdf (offering no rebate to remove liquidity from BYX for executions by its members that do not qualify for an enhanced rebate). 7 The Exchange notes that to the extent DE Route does or does not achieve any volume tiered rebate on BYX, its rate for Flag RY will not change. 5 See E:\FR\FM\09MYN1.SGM 09MYN1 Federal Register / Vol. 78, No. 90 / Thursday, May 9, 2013 / Notices that are routed to BYX and add liquidity.8 The Exchange proposes to implement these amendments to its fee schedule on May 1, 2013. 2. Statutory Basis mstockstill on DSK4VPTVN1PROD with NOTICES The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,9 in general, and furthers the objectives of Section 6(b)(4),10 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 its proposal to decrease the rebate for Flag BY and pass through no charge nor rebate for Members’ orders that yield Flag BY represents an equitable allocation of reasonable dues, fees and other charges among its Members and other persons using its facilities. First, the elimination of the rebate allows the Exchange to have additional revenue to offset its administrative, operational, and infrastructure costs. Second, the proposed rate (free) is competitive as it is in line with the non-tiered rebates for adding liquidity to BYX. When DE Route, the Exchange’s affiliated routing broker-dealer, routes to BYX, it is rebated $0.0005 per share provided it adds an average daily volume of 50,000 shares per day on BYX. However, when DE Route does not meet such volume threshold on BYX, it is assessed no fee nor rebate (free). The proposed rate (free) 11 represents a rate that matches the non-tiered rate provided by BYX. The rate is also in line with what BATS Exchange, Inc. (‘‘BZX’’) rebates for routing to BYX.12 Lastly, the Exchange also believes that the proposed amendment is non-discriminatory because it applies uniformly to all Members. 8 See Securities Exchange Act Release No. 69317 (April 5, 2013), 78 FR 21651 (April 11, 2013) (SR– BYX–2013–012) (amending the rate BYX charges for adding displayed liquidity to the BYX order book for executions by members that do not qualify for a reduced charge from $0.0005 per share to $0.0007 per share). 9 15 U.S.C. 78f. 10 15 U.S.C. 78f(b)(4). 11 See BYX Fee Schedule, https:// cdn.batstrading.com/resources/regulation/ rule_book/BATS-Exchanges_Fee_Schedules.pdf (offering no rebate to remove liquidity from BYX for executions by its members that do not qualify for an enhanced rebate). 12 For example, when orders using BZX’s TRIM/ TRIM2/TRIM3 routing strategies execute at BYX Exchange, a rebate of $0.0002 per share is provided. This is a rate that is in between the tiered rebate of $0.0005 per share and non-tiered rate (free) from BYX. See BATS BZX Fee Schedule, https:// cdn.batstrading.com/resources/regulation/ rule_book/BATS-Exchanges_Fee_Schedules.pdf. VerDate Mar<15>2010 17:18 May 08, 2013 Jkt 229001 The Exchange believes that its proposal to pass through a charge of $0.0007 for Members’ orders that yield Flag RY represents an equitable allocation of reasonable dues, fees, and other charges among Members of the Exchange and other persons using its facilities because the Exchange does not levy additional fees or offer additional rebates for orders that it routes to BYX through DE Route. Prior to BYX’s April 2013 fee filing, BYX charged DE Route a fee of $ 0.0005 per share for orders yielding Flag RY, which DE Route passed through to the Exchange and the Exchange passed through to its Members. In BYX’s April 2013 fee filing, BYX increased the rate it charges its customers, such as DE Route, from $0.0005 per share to a charge of $0.0007 per share for orders that are routed to BYX and add liquidity. Therefore, the Exchange believes that the proposed change in Flag RY from a fee of $0.0005 per share to a fee of $0.0007 per share is equitable and reasonable because it accounts for the pricing changes on BYX. In addition, the proposal allows the Exchange to continue to charge its Members a pass-through rate for orders that are routed to BYX and add liquidity using DE Route. The Exchange notes that routing through DE Route is voluntary. Lastly, the Exchange also believes that the proposed amendment is non-discriminatory because it applies uniformly to all Members. B. Self-Regulatory Organization’s Statement on Burden on Competition These proposed rule changes do not impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that any of these changes represent a significant departure from previous pricing offered by the Exchange or pricing offered by any of the Exchange’s competitors. Additionally, Members may opt to disfavor the Exchange’s pricing if they believe that alternatives offer them better value. Accordingly, the Exchange believes that the proposed changes would not impair the ability of Members or competing venues to maintain their competitive standing in the financial markets. The Exchange believes that its proposal to pass through no charge nor rebate for Members’ orders that yield Flag BY would not burden intermarket competition because the proposed rate is in line with BYX’s non-tiered rate and rates for routing to BYX from BZX. Additionally, for customers that do not have sufficient volume to satisfy BYX’s tier, Flag BY offers customers an alternative means to route to BYX and PO 00000 Frm 00098 Fmt 4703 Sfmt 4703 27275 remove liquidity for the same price as entering orders on BYX directly. The Exchange believes its proposal would not burden intramarket competition because the proposed rate would apply uniformly to all Members. The Exchange believes that its proposal to pass through a charge of $0.0007 per share for Members’ orders that yield Flag RY would increase intermarket competition because it offers customers an alternative means to route to BYX and add liquidity for the same price as entering orders on BYX directly. The Exchange believes that its proposal would not burden intramarket competition because the proposed rate would apply uniformly to all Members. The Exchange believes that its proposal would increase competition for routing services because the market for order execution is competitive and the Exchange’s proposal provides customers with another alternative to route their orders. The Exchange notes that routing through DE Route is voluntary. 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)(A) of the Act 13 and Rule 19b–4(f)(2) 14 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: 13 15 14 17 E:\FR\FM\09MYN1.SGM U.S.C. 78s(b)(3)(A). CFR 240.19b–4 (f)(2). 09MYN1 27276 Federal Register / Vol. 78, No. 90 / Thursday, May 9, 2013 / Notices Electronic Comments DEPARTMENT OF STATE • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rulecomments@sec.gov. Please include File Number SR–EDGX–2013–15 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. mstockstill on DSK4VPTVN1PROD with NOTICES All submissions should refer to File Number SR–EDGX–2013–15. 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 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–EDGX– 2013–15 and should be submitted on or before May 30, 2013. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.15 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2013–11017 Filed 5–8–13; 8:45 am] BILLING CODE 8011–01–P 15 17 CFR 200.30–3(a)(12). VerDate Mar<15>2010 17:18 May 08, 2013 Jkt 229001 [Public Notice 8315] Culturally Significant Object Imported for Exhibition Determinations: ‘‘Goya’s Two Hares’’ Notice is hereby given of the following determinations: Pursuant to the authority vested in me by the Act of October 19, 1965 (79 Stat. 985; 22 U.S.C. 2459), Executive Order 12047 of March 27, 1978, the Foreign Affairs Reform and Restructuring Act of 1998 (112 Stat. 2681, et seq.; 22 U.S.C. 6501 note, et seq.), Delegation of Authority No. 234 of October 1, 1999, Delegation of Authority No. 236–3 of August 28, 2000 (and, as appropriate, Delegation of Authority No. 257 of April 15, 2003), I hereby determine that the object to be included in the exhibition ‘‘Goya’s Two Hares,’’ imported from abroad for temporary exhibition within the United States, is of cultural significance. The object is imported pursuant to a loan agreement with the foreign owner or custodian. I also determine that the exhibition or display of the exhibit object at The Metropolitan Museum of Art, New York, NY, from on or about May 18, 2013, until on or about May 31, 2014, and at possible additional exhibitions or venues yet to be determined, is in the national interest. I have ordered that Public Notice of these Determinations be published in the Federal Register. FOR FURTHER INFORMATION CONTACT: For further information, including a list of the exhibit object, contact Julie Simpson, Attorney-Adviser, Office of the Legal Adviser, U.S. Department of State (telephone: 202–632–6467). The mailing address is U.S. Department of State, SA–5, L/PD, Fifth Floor (Suite 5H03), Washington, DC 20522–0505. SUMMARY: Office of Management and Budget Circular No. A–130, Appendix I. DATES: This system of records will be effective on June 18, 2013, unless we receive comments that will result in a contrary determination. ADDRESSES: Any persons interested in commenting on the amended system of records may do so by writing to the Director; Office of Information Programs and Services, A/GIS/IPS; Department of State, SA–2; 515 22nd Street NW., Washington, DC 20522–8001. FOR FURTHER INFORMATION CONTACT: Director; Office of Information Programs and Services, A/GIS/IPS; Department of State, SA–2; 515 22nd Street NW., Washington, DC 20522–8001. SUPPLEMENTARY INFORMATION: The Department of State proposes that the current system retain the name ‘‘Security Records’’ (previously published as 72 FR 73057). The records maintained in State-36, Security Records, capture data related to incidents and threats affecting U.S. Government personnel, U.S. Government information, or U.S. Government facilities world-wide for a variety of legal purposes including Federal and state law enforcement and counterterrorism purposes. The information maintained in Security Records may also be used to determine general suitability for employment or retention in employment, to grant a contract or issue a license, grant, or security clearance. The proposed system will include modifications to all of the sections. The Department’s report was filed with the Office of Management and Budget. The amended system description, ‘‘Security Records, State– 36,’’ will read as set forth below. Dated: May 3, 2013. J. Adam Ereli, Principal Deputy Assistant Secretary, Bureau of Educational and Cultural Affairs, Department of State. Joyce A. Barr, Assistant Secretary for Administration, U.S. Department of State. [FR Doc. 2013–11096 Filed 5–8–13; 8:45 am] SYSTEM NAME: STATE—36 Security Records. BILLING CODE 4710–05–P SECURITY CLASSIFICATION: Unclassified and Classified. DEPARTMENT OF STATE SYSTEM LOCATION: [Public Notice 8314] Privacy Act; System of Records: Security Records, State-36 Notice is hereby given that the Department of State proposes to amend an existing system of records, Security Records, State-36, pursuant to the provisions of the Privacy Act of 1974, as amended (5 U.S.C. 552a) and SUMMARY: PO 00000 Frm 00099 Fmt 4703 Sfmt 4703 Department of State and its annexes, Bureau of Diplomatic Security, various field and regional offices throughout the United States, and abroad at some U.S. embassies and U.S. consulates. CATEGORIES OF INDIVIDUALS COVERED BY THE SYSTEM: Present and former employees of the Department of State; applicants for E:\FR\FM\09MYN1.SGM 09MYN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 78, Number 90 (Thursday, May 9, 2013)]
[Notices]
[Pages 27274-27276]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-11017]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69510; File No. SR-EDGX-2013-15]

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

May 3, 2013.
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 May 1, 2013, EDGX Exchange, Inc. (the ``Exchange'' or ``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.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

The Exchange proposes to amend 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 www.directedge.com, at the Exchange's principal
office, and at the Public Reference Room of the Commission.
---------------------------------------------------------------------------

\3\ As defined in Exchange Rule 1.5(n).
---------------------------------------------------------------------------

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.

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

1. Purpose
In securities priced at or above $1.00, the Exchange currently
provides a rebate of $0.0002 per share for Members' orders that yield
Flag BY, which routes to BATS BYX (``BYX'') and removes liquidity using
routing strategies ROUC, ROUE, or ROBY.\4\ The Exchange proposes to
amend its fee schedule to assess no charge (``free'') nor provide any
rebate for Members' orders that yield Flag BY. When Direct Edge ECN LLC
(d/b/a DE Route) (``DE Route''), the Exchange's affiliated routing
broker-dealer, routes to BYX, it is rebated $0.0005 per share for
adding an average daily volume of 50,000 shares per day on BYX.\5\
However, DE Route will pass through the non-tiered rate on BYX (no fee
nor rebate) to the Exchange and the Exchange, in turn, will pass
through no fee nor rebate to its Members.\6\
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\4\ As defined in Exchange Rule 11.9(b)(2).
\5\ See Securities Exchange Act Release No. 69317 (April 5,
2013), 78 FR 21651 (April 11, 2013) (SR-BYX-2013-012) (amending the
rebate BYX provides for removing liquidity from the BYX order book
for executions by members that add a daily average volume of at
least 50,000 shares from $0.0002 per share to $0.0005 per share).
\6\ The Exchange notes that to the extent DE Route does or does
not achieve any volume tiered rebate on BYX, its rate for Flag BY
will not change. See BYX Fee Schedule, https://cdn.batstrading.com/resources/regulation/rule_book/BATS-Exchanges_Fee_Schedules.pdf
(offering no rebate to remove liquidity from BYX for executions by
its members that do not qualify for an enhanced rebate).
---------------------------------------------------------------------------

In securities priced at $1.00 or above, the Exchange currently
assesses a charge of $0.0005 per share for Members' orders that yield
Flag RY, which routes to BYX and adds liquidity. The Exchange proposes
to amend its fee schedule to increase the rate it charges Members from
$0.0005 per share to $0.0007 per share for Flag RY. The proposed change
represents a pass through of the rate that DE Route is charged for
routing orders to BYX that do not qualify for additional volume tiered
discounts.\7\ DE Route passes through the charge to the Exchange and
the Exchange, in turn, passes through the charge to its Members. The
Exchange notes that the proposed change is in response to BYX's April
2013 fee filing with the Commission, wherein BYX increased the rate it
charges its customers, such as DE Route, from a charge of $0.0005 per
share to a charge of $0.0007 per share for orders

[[Page 27275]]

that are routed to BYX and add liquidity.\8\
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\7\ The Exchange notes that to the extent DE Route does or does
not achieve any volume tiered rebate on BYX, its rate for Flag RY
will not change.
\8\ See Securities Exchange Act Release No. 69317 (April 5,
2013), 78 FR 21651 (April 11, 2013) (SR-BYX-2013-012) (amending the
rate BYX charges for adding displayed liquidity to the BYX order
book for executions by members that do not qualify for a reduced
charge from $0.0005 per share to $0.0007 per share).
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The Exchange proposes to implement these amendments to its fee
schedule on May 1, 2013.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the objectives of Section 6 of the Act,\9\ in general, and
furthers the objectives of Section 6(b)(4),\10\ 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.
---------------------------------------------------------------------------

\9\ 15 U.S.C. 78f.
\10\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

The Exchange believes that its proposal to decrease the rebate for
Flag BY and pass through no charge nor rebate for Members' orders that
yield Flag BY represents an equitable allocation of reasonable dues,
fees and other charges among its Members and other persons using its
facilities. First, the elimination of the rebate allows the Exchange to
have additional revenue to offset its administrative, operational, and
infrastructure costs. Second, the proposed rate (free) is competitive
as it is in line with the non-tiered rebates for adding liquidity to
BYX. When DE Route, the Exchange's affiliated routing broker-dealer,
routes to BYX, it is rebated $0.0005 per share provided it adds an
average daily volume of 50,000 shares per day on BYX. However, when DE
Route does not meet such volume threshold on BYX, it is assessed no fee
nor rebate (free). The proposed rate (free) \11\ represents a rate that
matches the non-tiered rate provided by BYX. The rate is also in line
with what BATS Exchange, Inc. (``BZX'') rebates for routing to BYX.\12\
Lastly, the Exchange also believes that the proposed amendment is non-
discriminatory because it applies uniformly to all Members.
---------------------------------------------------------------------------

\11\ See BYX Fee Schedule, https://cdn.batstrading.com/resources/regulation/rule_book/BATS-Exchanges_Fee_Schedules.pdf (offering
no rebate to remove liquidity from BYX for executions by its members
that do not qualify for an enhanced rebate).
\12\ For example, when orders using BZX's TRIM/TRIM2/TRIM3
routing strategies execute at BYX Exchange, a rebate of $0.0002 per
share is provided. This is a rate that is in between the tiered
rebate of $0.0005 per share and non-tiered rate (free) from BYX. See
BATS BZX Fee Schedule, https://cdn.batstrading.com/resources/regulation/rule_book/BATS-Exchanges_Fee_Schedules.pdf.
---------------------------------------------------------------------------

The Exchange believes that its proposal to pass through a charge of
$0.0007 for Members' orders that yield Flag RY represents an equitable
allocation of reasonable dues, fees, and other charges among Members of
the Exchange and other persons using its facilities because the
Exchange does not levy additional fees or offer additional rebates for
orders that it routes to BYX through DE Route. Prior to BYX's April
2013 fee filing, BYX charged DE Route a fee of $ 0.0005 per share for
orders yielding Flag RY, which DE Route passed through to the Exchange
and the Exchange passed through to its Members. In BYX's April 2013 fee
filing, BYX increased the rate it charges its customers, such as DE
Route, from $0.0005 per share to a charge of $0.0007 per share for
orders that are routed to BYX and add liquidity. Therefore, the
Exchange believes that the proposed change in Flag RY from a fee of
$0.0005 per share to a fee of $0.0007 per share is equitable and
reasonable because it accounts for the pricing changes on BYX. In
addition, the proposal allows the Exchange to continue to charge its
Members a pass-through rate for orders that are routed to BYX and add
liquidity using DE Route. The Exchange notes that routing through DE
Route is voluntary. Lastly, the Exchange also believes that the
proposed amendment is non-discriminatory because it applies uniformly
to all Members.

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

These proposed rule changes do not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act. The Exchange does not believe that any of these changes
represent a significant departure from previous pricing offered by the
Exchange or pricing offered by any of the Exchange's competitors.
Additionally, Members may opt to disfavor the Exchange's pricing if
they believe that alternatives offer them better value. Accordingly,
the Exchange believes that the proposed changes would not impair the
ability of Members or competing venues to maintain their competitive
standing in the financial markets.
The Exchange believes that its proposal to pass through no charge
nor rebate for Members' orders that yield Flag BY would not burden
intermarket competition because the proposed rate is in line with BYX's
non-tiered rate and rates for routing to BYX from BZX. Additionally,
for customers that do not have sufficient volume to satisfy BYX's tier,
Flag BY offers customers an alternative means to route to BYX and
remove liquidity for the same price as entering orders on BYX directly.
The Exchange believes its proposal would not burden intramarket
competition because the proposed rate would apply uniformly to all
Members.
The Exchange believes that its proposal to pass through a charge of
$0.0007 per share for Members' orders that yield Flag RY would increase
intermarket competition because it offers customers an alternative
means to route to BYX and add liquidity for the same price as entering
orders on BYX directly. The Exchange believes that its proposal would
not burden intramarket competition because the proposed rate would
apply uniformly to all Members.
The Exchange believes that its proposal would increase competition
for routing services because the market for order execution is
competitive and the Exchange's proposal provides customers with another
alternative to route their orders. The Exchange notes that routing
through DE Route is voluntary.

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)(A) of the Act \13\ and Rule 19b-4(f)(2) \14\ 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.
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\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 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:

[[Page 27276]]

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-EDGX-2013-15 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-2013-15. 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 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-EDGX-2013-15 and should be
submitted on or before May 30, 2013.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
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\15\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-11017 Filed 5-8-13; 8:45 am]
BILLING CODE 8011-01-P

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