Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Related to Fees for Use of BATS Exchange, Inc., 78460-78462 [2013-30761]

Download as PDF 78460 Federal Register / Vol. 78, No. 248 / Thursday, December 26, 2013 / Notices origin code, and account designation. On the other hand, an authorized trade reporter handling a block order which cannot be immediately entered into OCX.BETS must prepare a written order ticket that includes the account designation, date, time of receipt, buy or sell, the contract and expiration month, the quantity of contracts, and the requested price. Such orders must be entered into OCX.BETS when it becomes executable or when it has been privately negotiated. Finally, Rule 417(h) will be added to clarify the two methods by which block trades can be traded. First, block trades can be competitively executed on OCX.BETS by placing anonymous bids or offers (utilizing the central limit order book functionality of OCX.BETS). Block trades can also be privately negotiated and reported to the OCX.BETS system as bilateral trades. emcdonald on DSK67QTVN1PROD with NOTICES 2. Statutory Basis OneChicago believes that the proposed rule change is consistent with Section 6(b) of the Act,2 in general, and furthers the objectives of Section 6(b)(5) of the Act,3 in particular, in that it is designed to foster cooperation and coordination with persons engaged in facilitating transactions in securities, and remove impediments to and perfect the mechanism of a free and open market and national market system. OneChicago believes that clarifying and consolidating its reporting and recordkeeping requirements for parties to block trades will foster cooperation and coordination with persons engaged in block trades because block participants will more easily locate and identify their reporting and recordkeeping requirements. B. Self-Regulatory Organization’s Statement on Burden on Competition OneChicago does not believe that the rule changes will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The Exchange believes that the proposed rule change is equitable and not unfairly discriminatory because it merely consolidates and clarifies the obligations of parties to block trades, and does not impose any new, material requirements on market participants. OneChicago believes the rule change enhances competition on our marketplace, as market participants can choose whether to execute blocks directly on OCX.BETS or to privately negotiate blocks and then report them to 2 15 U.S.C. 78f(b). 3 15 U.S.C. 78(f)(b)(5). VerDate Mar<15>2010 18:06 Dec 24, 2013 Jkt 232001 OCX.BETS. Additionally, market participants may also choose to execute block size transactions in our CBOEdirect based Central Order Book. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Comments on the OneChicago proposed rule change have not been solicited and none have been received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action OneChicago filed the proposed rule change with the CFTC on September 10, 2012, and the proposed rule change became effective with the CFTC on September 25, 2012. OneChicago did not file the proposed rule changes concurrently with the SEC. Instead, OneChicago filed the proposed rule change on December 18, 2013.4 At any time within 60 days of the date of effectiveness 5 of the proposed rule change, the Commission, after consultation with the CFTC, may summarily abrogate the proposed rule change and require that the proposed rule change be refiled in accordance with the provisions of Section 19(b)(1) 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 • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– OC–2013–03 on the subject line. All submissions should refer to File Number SR–OC–2013–03. 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 (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, 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 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–OC– 2013–03, and should be submitted on or before January 16, 2014. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.6 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2013–30766 Filed 12–24–13; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Paper Comments [Release No. 34–71140; File No. SR–BATS– 2013–063] • Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090. Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Related to Fees for Use of BATS Exchange, Inc. 4 Section 19(b)(7)(B) of the Act provides that a proposed rule change filed with the SEC pursuant to section 19(b)(7)(A) of the Act shall be filed concurrently with the CFTC. 5 Section 19(b)(7)(C) of the Act provides, inter alia, that ‘‘[a]ny proposed rule change of a selfregulatory organization that has taken effect pursuant to [Section 19(b)(7)(B) of the Act] may be enforced by such self-regulatory organization to the extent such rule is not inconsistent with the provisions of this title, the rules and regulations thereunder, and applicable Federal law.’’ PO 00000 Frm 00136 Fmt 4703 Sfmt 4703 December 19, 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 December 9, 2013, BATS Exchange, Inc. (the 6 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\26DEN1.SGM 26DEN1 Federal Register / Vol. 78, No. 248 / Thursday, December 26, 2013 / Notices ‘‘Exchange’’ or ‘‘BATS’’) 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 Exchange. The Exchange has designated the proposed rule change as one establishing or changing a member due, fee, or other charge imposed by the Exchange under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b–4(f)(2) thereunder,4 which renders the proposed rule change effective upon filing with the Commission. 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 the Substance of the Proposed Rule Change The Exchange filed a proposal to amend the fee schedule applicable to Members 5 and non-members of the Exchange pursuant to BATS Rules 15.1(a) and (c). Changes to the fee schedule pursuant to this proposal are effective upon filing. The text of the proposed rule change is available at the Exchange’s Web site at http://www.batstrading.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant parts of such statements. emcdonald on DSK67QTVN1PROD with NOTICES A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of the proposed rule change is to modify the ‘‘Equities Pricing’’ section of its fee schedule effective December 9, 2013, in order to temporarily amend the way that the Exchange calculates rebates for adding 3 15 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). 5 A Member is any registered broker or dealer that has been admitted to membership in the Exchange. 4 17 VerDate Mar<15>2010 18:06 Dec 24, 2013 Jkt 232001 liquidity to the Exchange. Specifically, the Exchange is proposing to exclude odd lot executions from the calculation of average daily TCV, as defined below, as it relates to ‘‘Equities Pricing’’ until February 1, 2014. The Exchange currently offers a tiered structure for determining the rebates that Members receive for executions that add liquidity to the Exchange. Under the tiered pricing structure, the Exchange provides different rebates to Members based on a Member’s ADAV or ADV 6 as a percentage of average daily TCV,7 as well as a possible additional rebate where a Member’s order sets or joins the NBBO and that Member meets or exceeds a certain threshold of ADAV or ADV as a percentage of average daily TCV. The Exchange notes that it is not proposing to modify any of the existing rebates or the percentage thresholds at which a Member may qualify for certain rebates. Rather, as mentioned above, the Exchange is proposing to modify the ‘‘Equities Pricing’’ section of its fee schedule in order to temporarily exclude odd lot executions from the calculation of average daily TCV. The Exchange is proposing to exclude odd lot executions from the calculation of average daily TCV through January 31, 2014 because recent amendments to the Consolidated Tape Association and NASDAQ UTP Plans 8 require that odd lots be reported to the consolidated tape. Beginning on December 9, 2013, exchanges and trade reporting facilities are required to report odd lot executions to the consolidated transaction reporting plan and, as currently defined, odd lots would be included in the calculation of 6 As provided in the ‘‘Equities Pricing’’ section of the fee schedule, ‘‘ADAV’’ means average daily added volume calculated as the number of shares added and ‘‘ADV’’ means average daily volume calculated as the number of shares added or removed, combined, per day. ADAV and ADV are calculated on a monthly basis, excluding shares added or removed on any day that trading is not available on the Exchange for more than 60 minutes during regular trading hours but continues on other markets during such time (‘‘Exchange Outage’’) and on the last Friday in June (the ‘‘Russell Reconstitution Day’’). Routed shares are not included in ADAV or ADV calculation. With prior notice to the Exchange, a Member may aggregate ADAV or ADV with other Members that control, are controlled by, or are under common control with such Member (as evidenced on such Member’s Form BD). 7 As provided in the ‘‘Equities Pricing’’ section of the fee schedule, ‘‘TCV’’ means total consolidated volume calculated as the volume reported by all exchanges and trade reporting facilities to a consolidated transaction reporting plan for the month for which the fees apply, excluding any day that the Exchange experiences an Exchange Outage and the Russell Reconstitution Day. 8 Securities Exchange Act Release No. 70794 (October 31, 2013), 78 FR 66789 (November 6, 2013) (SR–CTA–2013–05); Securities Exchange Act Release No. 70793 (October 31, 2013), 78 FR 66788 (November 6, 2013) (File No. S7–24–89). PO 00000 Frm 00137 Fmt 4703 Sfmt 4703 78461 TCV. As such, the Exchange is proposing to amend the definition of TCV in order to exclude odd lots from the calculation of TCV until January 31, 2014. When calculating ADAV or ADV as a percentage of TCV, the Exchange has historically included odd lots in the Member’s ADV and ADAV, but excluded them from TCV since they have not been included in the trades reported to consolidated transaction reporting plans. Accordingly, the proposal intends to exclude odd lots from TCV for the first two billing cycles in which odd lots are reported to the consolidated transaction reporting plans in order to create a period during which odd lot reporting behavior can be observed without affecting the rebates for which a Member will qualify. The Exchange believes that excluding such odd lots will help to eliminate uncertainty faced by Members as to their monthly ADAV or ADV as a percentage of average daily TCV because of the additional reported volume and the rebates that this percentage will qualify for, providing Members with an increased certainty as to their monthly cost for trades executed on the Exchange. Further, excluding such odd lots through January 31, 2014 will allow the Exchange to evaluate the impact that odd lot orders would have on Member rebates. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder that are applicable to a national securities exchange, and, in particular, with the requirements of Section 6 of the Act.9 Specifically, the Exchange believes that the proposed rule change is consistent with Section 6(b)(4) of the Act,10 in that it provides for the equitable allocation of reasonable dues, fees and other charges among members and other persons using any facility or system which the Exchange operates or controls. 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 structures at a particular venue to be unreasonable and/or excessive. With respect to the proposed changes to the tiered pricing structure for adding liquidity to the Exchange, the Exchange believes that its proposal is reasonable because, as explained above, it will help provide Members with a greater level of certainty as to their level of rebates for 9 15 U.S.C. 78f. U.S.C. 78f(b)(4). 10 15 E:\FR\FM\26DEN1.SGM 26DEN1 78462 Federal Register / Vol. 78, No. 248 / Thursday, December 26, 2013 / Notices December and January. The Exchange also believes that its proposal is reasonable because it is not changing the thresholds to become eligible or the dollar value associated with the rebates and, moreover, by continuing to exclude odd lots from the calculation of average daily TCV, Members will be more likely to meet the minimum or higher tier thresholds for December and January, which will provide additional incentive to Members to increase their participation on the Exchange in order to meet the next tier. In addition, the Exchange believes that the proposed changes to fees are equitably allocated among Exchange constituents as the methodology for calculating ADV and TCV will apply equally to all Members. Volume-based tiers such as the liquidity adding tiers maintained by the Exchange have been widely adopted in the equities markets, and are equitable and not unfairly discriminatory because they are open to all members on an equal basis and provide rebates that are reasonably related to the value to an exchange’s market quality associated with higher levels of market activity, such as higher levels of liquidity provision and introduction of higher volumes of orders into the price and volume discovery process. Accordingly, the Exchange believes that the proposal is equitably allocated and not unfairly discriminatory because it is consistent with the overall goals of enhancing market quality. B. Self-Regulatory Organization’s Statement on Burden on Competition emcdonald on DSK67QTVN1PROD with NOTICES The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The proposed changes will help the Exchange to continue to incentivize higher levels of liquidity at a tighter spread while providing more stable and predictable costs to its Members. As stated above, 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 structures to be unreasonable or excessive. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange has neither solicited nor received written comments on the proposed rule change. VerDate Mar<15>2010 18:06 Dec 24, 2013 Jkt 232001 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 11 and paragraph (f) of Rule 19b–4 thereunder.12 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. IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– BATS–2013–063 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–BATS–2013–063. 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 (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, 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 such 11 15 12 17 PO 00000 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f). Frm 00138 Fmt 4703 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–BATS– 2013–063 and should be submitted on or before January 16, 2014. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2013–30761 Filed 12–24–13; 8:45 am] BILLING CODE 8011–01–P SOCIAL SECURITY ADMINISTRATION [Docket No. SSA–2013–0054] Open Government: Use of Genetic Information in Documenting and Evaluating Disability; Extension of Comment Period Social Security Administration. Notice of extension of comment AGENCY: ACTION: period. On November 26, 2013, we announced in the Federal Register that we were soliciting ideas and comments about the use of genetic information in the disability determination process via an online forum. We stated that the forum would be open until December 26, 2013. We are extending that deadline until January 16, 2014. DATES: The forum will be open for your ideas and comments until January 16, 2014. FOR FURTHER INFORMATION CONTACT: Cheryl A. Williams, Office of Medical Listings Improvement, Social Security Administration, 6401 Security Boulevard, Baltimore, Maryland 21235– 6401, (410) 965–1020. For information on eligibility or filing for benefits, call our national toll-free number, 1–800– 772–1213, or TTY 1–800–325–0778, or visit our Internet site, Social Security Online, at http:// www.socialsecurity.gov. SUPPLEMENTARY INFORMATION: On November 26, 2013, we announced in the Federal Register that we were soliciting ideas and comments about the use of genetic information in the disability determination process via an online forum that would be open until December 26, 2013.1 We have SUMMARY: 13 17 1 78 Sfmt 4703 E:\FR\FM\26DEN1.SGM CFR 200.30–3(a)(12). FR 70617. 26DEN1

Agencies

[Federal Register Volume 78, Number 248 (Thursday, December 26, 2013)]
[Notices]
[Pages 78460-78462]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-30761]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-71140; File No. SR-BATS-2013-063]


Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Related to 
Fees for Use of BATS Exchange, Inc.

December 19, 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 December 9, 2013, BATS Exchange, Inc. (the

[[Page 78461]]

``Exchange'' or ``BATS'') 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 
Exchange. The Exchange has designated the proposed rule change as one 
establishing or changing a member due, fee, or other charge imposed by 
the Exchange under Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-
4(f)(2) thereunder,\4\ which renders the proposed rule change effective 
upon filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    The Exchange filed a proposal to amend the fee schedule applicable 
to Members \5\ and non-members of the Exchange pursuant to BATS Rules 
15.1(a) and (c). Changes to the fee schedule pursuant to this proposal 
are effective upon filing.
---------------------------------------------------------------------------

    \5\ A Member is any registered broker or dealer that has been 
admitted to membership in the Exchange.
---------------------------------------------------------------------------

    The text of the proposed rule change is available at the Exchange's 
Web site at http://www.batstrading.com, at the principal office of the 
Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
Sections A, B, and C below, of the most significant parts of such 
statements.

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

1. Purpose
    The purpose of the proposed rule change is to modify the ``Equities 
Pricing'' section of its fee schedule effective December 9, 2013, in 
order to temporarily amend the way that the Exchange calculates rebates 
for adding liquidity to the Exchange. Specifically, the Exchange is 
proposing to exclude odd lot executions from the calculation of average 
daily TCV, as defined below, as it relates to ``Equities Pricing'' 
until February 1, 2014.
    The Exchange currently offers a tiered structure for determining 
the rebates that Members receive for executions that add liquidity to 
the Exchange. Under the tiered pricing structure, the Exchange provides 
different rebates to Members based on a Member's ADAV or ADV \6\ as a 
percentage of average daily TCV,\7\ as well as a possible additional 
rebate where a Member's order sets or joins the NBBO and that Member 
meets or exceeds a certain threshold of ADAV or ADV as a percentage of 
average daily TCV. The Exchange notes that it is not proposing to 
modify any of the existing rebates or the percentage thresholds at 
which a Member may qualify for certain rebates. Rather, as mentioned 
above, the Exchange is proposing to modify the ``Equities Pricing'' 
section of its fee schedule in order to temporarily exclude odd lot 
executions from the calculation of average daily TCV.
---------------------------------------------------------------------------

    \6\ As provided in the ``Equities Pricing'' section of the fee 
schedule, ``ADAV'' means average daily added volume calculated as 
the number of shares added and ``ADV'' means average daily volume 
calculated as the number of shares added or removed, combined, per 
day. ADAV and ADV are calculated on a monthly basis, excluding 
shares added or removed on any day that trading is not available on 
the Exchange for more than 60 minutes during regular trading hours 
but continues on other markets during such time (``Exchange 
Outage'') and on the last Friday in June (the ``Russell 
Reconstitution Day''). Routed shares are not included in ADAV or ADV 
calculation. With prior notice to the Exchange, a Member may 
aggregate ADAV or ADV with other Members that control, are 
controlled by, or are under common control with such Member (as 
evidenced on such Member's Form BD).
    \7\ As provided in the ``Equities Pricing'' section of the fee 
schedule, ``TCV'' means total consolidated volume calculated as the 
volume reported by all exchanges and trade reporting facilities to a 
consolidated transaction reporting plan for the month for which the 
fees apply, excluding any day that the Exchange experiences an 
Exchange Outage and the Russell Reconstitution Day.
---------------------------------------------------------------------------

    The Exchange is proposing to exclude odd lot executions from the 
calculation of average daily TCV through January 31, 2014 because 
recent amendments to the Consolidated Tape Association and NASDAQ UTP 
Plans \8\ require that odd lots be reported to the consolidated tape. 
Beginning on December 9, 2013, exchanges and trade reporting facilities 
are required to report odd lot executions to the consolidated 
transaction reporting plan and, as currently defined, odd lots would be 
included in the calculation of TCV. As such, the Exchange is proposing 
to amend the definition of TCV in order to exclude odd lots from the 
calculation of TCV until January 31, 2014. When calculating ADAV or ADV 
as a percentage of TCV, the Exchange has historically included odd lots 
in the Member's ADV and ADAV, but excluded them from TCV since they 
have not been included in the trades reported to consolidated 
transaction reporting plans. Accordingly, the proposal intends to 
exclude odd lots from TCV for the first two billing cycles in which odd 
lots are reported to the consolidated transaction reporting plans in 
order to create a period during which odd lot reporting behavior can be 
observed without affecting the rebates for which a Member will qualify. 
The Exchange believes that excluding such odd lots will help to 
eliminate uncertainty faced by Members as to their monthly ADAV or ADV 
as a percentage of average daily TCV because of the additional reported 
volume and the rebates that this percentage will qualify for, providing 
Members with an increased certainty as to their monthly cost for trades 
executed on the Exchange. Further, excluding such odd lots through 
January 31, 2014 will allow the Exchange to evaluate the impact that 
odd lot orders would have on Member rebates.
---------------------------------------------------------------------------

    \8\ Securities Exchange Act Release No. 70794 (October 31, 
2013), 78 FR 66789 (November 6, 2013) (SR-CTA-2013-05); Securities 
Exchange Act Release No. 70793 (October 31, 2013), 78 FR 66788 
(November 6, 2013) (File No. S7-24-89).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder that are applicable to a national securities exchange, and, 
in particular, with the requirements of Section 6 of the Act.\9\ 
Specifically, the Exchange believes that the proposed rule change is 
consistent with Section 6(b)(4) of the Act,\10\ in that it provides for 
the equitable allocation of reasonable dues, fees and other charges 
among members and other persons using any facility or system which the 
Exchange operates or controls. 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 structures at a 
particular venue to be unreasonable and/or excessive.
---------------------------------------------------------------------------

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

    With respect to the proposed changes to the tiered pricing 
structure for adding liquidity to the Exchange, the Exchange believes 
that its proposal is reasonable because, as explained above, it will 
help provide Members with a greater level of certainty as to their 
level of rebates for

[[Page 78462]]

December and January. The Exchange also believes that its proposal is 
reasonable because it is not changing the thresholds to become eligible 
or the dollar value associated with the rebates and, moreover, by 
continuing to exclude odd lots from the calculation of average daily 
TCV, Members will be more likely to meet the minimum or higher tier 
thresholds for December and January, which will provide additional 
incentive to Members to increase their participation on the Exchange in 
order to meet the next tier. In addition, the Exchange believes that 
the proposed changes to fees are equitably allocated among Exchange 
constituents as the methodology for calculating ADV and TCV will apply 
equally to all Members.
    Volume-based tiers such as the liquidity adding tiers maintained by 
the Exchange have been widely adopted in the equities markets, and are 
equitable and not unfairly discriminatory because they are open to all 
members on an equal basis and provide rebates that are reasonably 
related to the value to an exchange's market quality associated with 
higher levels of market activity, such as higher levels of liquidity 
provision and introduction of higher volumes of orders into the price 
and volume discovery process. Accordingly, the Exchange believes that 
the proposal is equitably allocated and not unfairly discriminatory 
because it is consistent with the overall goals of enhancing market 
quality.

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The proposed changes will help 
the Exchange to continue to incentivize higher levels of liquidity at a 
tighter spread while providing more stable and predictable costs to its 
Members. As stated above, 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 structures to be 
unreasonable or excessive.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange has neither solicited nor received written comments on 
the proposed rule change.

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 \11\ and paragraph (f) of Rule 19b-4 
thereunder.\12\ 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.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-BATS-2013-063 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-BATS-2013-063. 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 (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, 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 such 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-BATS-2013-063 and should be 
submitted on or before January 16, 2014.
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    \13\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-30761 Filed 12-24-13; 8:45 am]
BILLING CODE 8011-01-P