Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Related to Fees for Use of BATS Y-Exchange, Inc., 21975-21977 [2014-08823]
Download as PDF
Federal Register / Vol. 79, No. 75 / Friday, April 18, 2014 / Notices
To support its Notice, the Postal
Service filed a copy of the Agreement,
a copy of the Governors’ Decision
authorizing the product, a certification
of compliance with 39 U.S.C. 3633(a),
and an application for non-public
treatment of certain materials. It also
filed supporting financial workpapers.
II. Notice of Commission Action
The Commission establishes Docket
No. CP2014–41 for consideration of
matters raised by the Notice.
The Commission invites comments on
whether the Postal Service’s filing is
consistent with 39 U.S.C. 3632, 3633, or
3642, 39 CFR part 3015, and 39 CFR
part 3020, subpart B. Comments are due
no later than April 22, 2014. The public
portions of the filing can be accessed via
the Commission’s Web site (https://
www.prc.gov).
The Commission appoints Kenneth R.
Moeller to serve as Public
Representative in this docket.
III. Ordering Paragraphs
It is ordered:
1. The Commission establishes Docket
No. CP2014–41 for consideration of the
matters raised by the Postal Service’s
Notice.
2. Pursuant to 39 U.S.C. 505, Kenneth
R. Moeller is appointed to serve as an
officer of the Commission to represent
the interests of the general public in this
proceeding (Public Representative).
3. Comments are due no later than
April 22, 2014.
4. The Secretary shall arrange for
publication of this order in the Federal
Register.
By the Commission.
Shoshana M. Grove,
Secretary.
[FR Doc. 2014–08909 Filed 4–17–14; 8:45 am]
BILLING CODE 7710–FW–P
POSTAL REGULATORY COMMISSION
[Docket No. CP2014–43; Order No. 2052]
New Postal Product
Postal Regulatory Commission.
Notice.
The Commission is noticing a
recent Postal Service filing requesting
the addition of a Global Plus 2C
negotiated service agreement to the
competitive product list. This notice
informs the public of the filing, invites
public comment, and takes other
administrative steps.
mstockstill on DSK4VPTVN1PROD with NOTICES
SUMMARY:
Contract Negotiated Service Agreement and
Application for Non-Public Treatment of Materials
Filed Under Seal, April 14, 2014 (Notice).
VerDate Mar<15>2010
16:54 Apr 17, 2014
Comments are due: April 22,
2014.
Submit comments
electronically via the Commission’s
Filing Online system at https://
www.prc.gov. Those who cannot submit
comments electronically should contact
the person identified in the FOR FURTHER
INFORMATION CONTACT section by
telephone for advice on filing
alternatives.
ADDRESSES:
FOR FURTHER INFORMATION CONTACT:
David A. Trissell, General Counsel, at
202–789–6820.
SUPPLEMENTARY INFORMATION:
Table of Contents
Jkt 232001
public in this proceeding (Public
Representative).
3. Comments are due no later than
April 22, 2014.
4. The Secretary shall arrange for
publication of this order in the Federal
Register.
By the Commission.
Shoshana M. Grove,
Secretary.
[FR Doc. 2014–08911 Filed 4–17–14; 8:45 am]
BILLING CODE 7710–FW–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–71940; File No. SR–BYX–
2014–005]
I. Introduction
II. Notice of Commission Action
III. Ordering Paragraphs
I. Introduction
On April 14, 2014, the Postal Service
filed notice that it has entered into an
additional Global Plus 2C negotiated
service agreement (Agreement).1
To support its Notice, the Postal
Service filed a copy of the Agreement,
a copy of the Governors’ Decision
authorizing the product, a certification
of compliance with 39 U.S.C. 3633(a),
and an application for non-public
treatment of certain materials. It also
filed supporting financial workpapers.
II. Notice of Commission Action
The Commission establishes Docket
No. CP2014–43 for consideration of
matters raised by the Notice.
The Commission invites comments on
whether the Postal Service’s filing is
consistent with 39 U.S.C. 3632, 3633, or
3642, 39 CFR part 3015, and 39 CFR
part 3020, subpart B. Comments are due
no later than April 22, 2014. The public
portions of the filing can be accessed via
the Commission’s Web site (https://
www.prc.gov).
The Commission appoints Manon A.
Boudreault to serve as Public
Representative in this docket.
III. Ordering Paragraphs
AGENCY:
ACTION:
DATES:
It is ordered:
1. The Commission establishes Docket
No. CP2014–43 for consideration of the
matters raised by the Postal Service’s
Notice.
2. Pursuant to 39 U.S.C. 505, Manon
A. Boudreault is appointed to serve as
an officer of the Commission to
represent the interests of the general
Self-Regulatory Organizations; BATS
Y-Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Related to Fees for Use
of BATS Y-Exchange, Inc.
April 14, 2014.
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 April 1,
2014, BATS Y-Exchange, Inc. (the
‘‘Exchange’’ or ‘‘BYX’’) 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 BYX 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
1 15
1 Notice
of the United States Postal Service of
Filing a Functionally Equivalent Global Plus 2C
Contract Negotiated Service Agreement and
Application for Non-Public Treatment of Materials
Filed Under Seal, April 14, 2014 (Notice).
PO 00000
Frm 00085
Fmt 4703
Sfmt 4703
21975
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(ii).
4 17 CFR 240.19b–4(f)(2).
5 A Member is any registered broker or dealer that
has been admitted to membership in the Exchange.
2 17
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21976
Federal Register / Vol. 79, No. 75 / Friday, April 18, 2014 / Notices
at https://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.
mstockstill on DSK4VPTVN1PROD with NOTICES
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange recently amended its
fee schedule, effective April 1, 2014, to
modify the rebates it provides for orders
that remove liquidity and the fees it
charges to add liquidity.6 Specifically,
the Exchange adopted a standard rebate
of $0.0015 per share for all orders that
remove liquidity in securities priced
$1.00 and above, with the exception of
Mid-Point Peg Order 7 liquidity (‘‘MidPoint Peg liquidity’’). For executions
that add displayed liquidity in
securities priced $1.00 or above, the
Exchange adopted a standard liquidity
adding fee of $0.0017 per share, subject
to reduced fees for Members that qualify
for tiered pricing based on volume
added to the Exchange.
The Exchange proposes to increase
both the standard rebate to remove
liquidity and the standard fee to add
displayed liquidity by $0.0001 per
share. Thus, for executions that remove
liquidity in securities priced $1.00 and
above, with the exception of Mid-Point
Peg liquidity, the Exchange proposes to
increase the standard rebate of $0.0015
per share to $0.0016 per share. For
executions that add displayed liquidity
in securities priced $1.00 or above, the
Exchange proposes to increase the
standard liquidity adding fee of $0.0017
per share to $0.0018 per share, subject
to reduced fees for Members that qualify
for tiered pricing based on volume
added to the Exchange. The Exchange
does not propose any other changes to
the recently adopted changes.
6 See SR–BYX–2014–004, available at https://
batstrading.com/regulation/rule_filings/byx/.
7 As defined in Exchange Rule 11.9(c)(9).
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16:54 Apr 17, 2014
Jkt 232001
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.8
Specifically, the Exchange believes that
the proposed rule change is consistent
with Section 6(b)(4) of the Act,9 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 levels at a
particular venue to be excessive.
The changes to Exchange execution
fees and rebates proposed by this filing
are intended to attract order flow to the
Exchange by continuing to offer
competitive pricing while also allowing
the Exchange to continue to offer
incentives to provide aggressively
priced displayed liquidity.
With respect to the proposed changes
to the pricing structure for removing
liquidity from the Exchange, the
Exchange believes that its proposal is
reasonable because the change provides
only a slight additional increase to the
recently adopted changes. The Exchange
also believes that the rebate for
removing liquidity in securities priced
$1.00 or above are reasonable and
equitably allocated because the
proposed changes will increase the
rebate for all orders that remove
liquidity (other than orders that remove
Mid-Point Peg liquidity). The proposed
rebates are equitably allocated and not
unfairly discriminatory because the
rebates will apply equally to all
Members.
With respect to the slight increase to
the fees charged to add displayed
liquidity in securities priced $1.00 or
above, the Exchange believes that the
proposed fees are reasonable, equitably
allocated and not unfairly
discriminatory as they are designed to
attract additional removing liquidity to
the Exchange. So, while the Exchange is
proposing to increase fees on a per share
basis, it is simultaneously providing
higher rebates to all Members for
removing liquidity. Thus, although the
change increases the fee for orders that
provide liquidity, it provides an
offsetting increase in the rebate for
8 15
9 15
PO 00000
U.S.C. 78f.
U.S.C. 78f(b)(4).
Frm 00086
Fmt 4703
Sfmt 4703
orders removing liquidity. The tiered
pricing structure and reduced fees for
Members that qualify are equitably
allocated and not unfairly
discriminatory for the reasons described
when the pricing structure was
adopted.10
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
is extremely competitive, Members may
choose to preference other market
centers ahead of the Exchange if they
believe that they can receive better fees
or rebates elsewhere. Further, such
changes are necessarily competitive
because they are intended to provide
incentives to Members that will result in
increased activity on the Exchange.
The Exchange also believes that its
pricing for removing liquidity is
`
appropriately competitive vis-a-vis the
Exchange’s competitors, with at least
one such competitor, NASDAQ OMX
BX, Inc. (‘‘NASDAQ BX’’), offering a
similar pricing model.11 In a
competitive environment, the Exchange
must continually adjust its fees to
remain competitive with other
exchanges and alternative liquidity
sources. Because competitors are free to
modify their own fees in response, and
because market participants may readily
adjust their order routing practices, the
Exchange believes that the degree to
which fee changes in this market may
impose any burden on competition is
extremely limited. The proposed
changes are, in fact, a direct response to
an adjustment by NASDAQ BX in
response to the Exchange’s recent
change to its pricing structure.12 Thus,
the modifications described herein are a
direct response to competition, which
should be viewed as a positive signal
that a competitive market exists. If the
changes are unattractive to market
participants, it is likely that the
Exchange will lose market share as a
result. Accordingly, the Exchange does
not believe that the proposed changes
will impair the ability of Members or
competing order execution venues to
maintain their competitive standing in
the financial markets. Finally, the
Exchange does not believe that any of
10 See
supra note 6.
NASDAQ BX Pricing List available at
https://www.nasdaqtrader.com/Trader.aspx?id=bx_
pricing.
12 See Nasdaq Equity Trader Alert #2014–28
available at https://www.nasdaqtrader.com/
TraderNews.aspx?id=ETA2014–28.
11 See
E:\FR\FM\18APN1.SGM
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Federal Register / Vol. 79, No. 75 / Friday, April 18, 2014 / Notices
the changes represent a significant
departure from previous pricing offered
by the Exchange or pricing offered by
the Exchange’s competitors.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 13 and paragraph (f) of Rule
19b–4 thereunder.14 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:
mstockstill on DSK4VPTVN1PROD with NOTICES
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–
BYX–2014–005 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BYX–2014–005. 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
13 15
U.S.C. 78s(b)(3)(A).
14 17 CFR 240.19b–4(f).
VerDate Mar<15>2010
16:54 Apr 17, 2014
Jkt 232001
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–BYX–
2014–005 and should be submitted on
or before May 9, 2014.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.15
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2014–08823 Filed 4–17–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–71939; File No. SR–BYX–
2014–004]
Self-Regulatory Organizations; BATS
Y-Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Related to Fees for Use
of BATS Y-Exchange, Inc.
April 14, 2014.
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 March 31,
2014, BATS Y-Exchange, Inc. (the
‘‘Exchange’’ or ‘‘BYX’’) 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
15 17
CFR 200.30–3(a)(12).
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).
21977
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 BYX 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 https://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 Exchange proposes to modify its
fee schedule effective April 1, 2014, in
order to: (i) Modify the tiers applicable
to the Exchange’s tiered pricing
structure; (ii) modify the rebates that the
Exchange provides for orders that
remove liquidity; (iii) modify the fees
that the Exchange charges to add
liquidity; (iv) adopt separate fees
applicable to adding and removing MidPoint Peg Order 6 liquidity (‘‘Mid-Point
Peg liquidity’’); (v) eliminate a specific
fee for orders that add non-displayed
liquidity to the Exchange and are
removed by Retail Orders (as defined
below); and (vi) modify the destinations
subject to the Exchange’s ‘‘One Under/
Better’’ pricing model for Destination
Specific Orders (as defined below). In
connection with these changes, the
Exchange is also proposing to make
1 15
PO 00000
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5 A Member is any registered broker or dealer that
has been admitted to membership in the Exchange.
6 As defined in Exchange Rule 11.9(c)(9).
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Agencies
[Federal Register Volume 79, Number 75 (Friday, April 18, 2014)]
[Notices]
[Pages 21975-21977]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-08823]
=======================================================================
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-71940; File No. SR-BYX-2014-005]
Self-Regulatory Organizations; BATS Y-Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Related to
Fees for Use of BATS Y-Exchange, Inc.
April 14, 2014.
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 April 1, 2014, BATS Y-Exchange, Inc. (the ``Exchange'' or
``BYX'') 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 BYX 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
[[Page 21976]]
at https://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 Exchange recently amended its fee schedule, effective April 1,
2014, to modify the rebates it provides for orders that remove
liquidity and the fees it charges to add liquidity.\6\ Specifically,
the Exchange adopted a standard rebate of $0.0015 per share for all
orders that remove liquidity in securities priced $1.00 and above, with
the exception of Mid-Point Peg Order \7\ liquidity (``Mid-Point Peg
liquidity''). For executions that add displayed liquidity in securities
priced $1.00 or above, the Exchange adopted a standard liquidity adding
fee of $0.0017 per share, subject to reduced fees for Members that
qualify for tiered pricing based on volume added to the Exchange.
---------------------------------------------------------------------------
\6\ See SR-BYX-2014-004, available at https://batstrading.com/regulation/rule_filings/byx/.
\7\ As defined in Exchange Rule 11.9(c)(9).
---------------------------------------------------------------------------
The Exchange proposes to increase both the standard rebate to
remove liquidity and the standard fee to add displayed liquidity by
$0.0001 per share. Thus, for executions that remove liquidity in
securities priced $1.00 and above, with the exception of Mid-Point Peg
liquidity, the Exchange proposes to increase the standard rebate of
$0.0015 per share to $0.0016 per share. For executions that add
displayed liquidity in securities priced $1.00 or above, the Exchange
proposes to increase the standard liquidity adding fee of $0.0017 per
share to $0.0018 per share, subject to reduced fees for Members that
qualify for tiered pricing based on volume added to the Exchange. The
Exchange does not propose any other changes to the recently adopted
changes.
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.\8\
Specifically, the Exchange believes that the proposed rule change is
consistent with Section 6(b)(4) of the Act,\9\ 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 levels at a
particular venue to be excessive.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f.
\9\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
The changes to Exchange execution fees and rebates proposed by this
filing are intended to attract order flow to the Exchange by continuing
to offer competitive pricing while also allowing the Exchange to
continue to offer incentives to provide aggressively priced displayed
liquidity.
With respect to the proposed changes to the pricing structure for
removing liquidity from the Exchange, the Exchange believes that its
proposal is reasonable because the change provides only a slight
additional increase to the recently adopted changes. The Exchange also
believes that the rebate for removing liquidity in securities priced
$1.00 or above are reasonable and equitably allocated because the
proposed changes will increase the rebate for all orders that remove
liquidity (other than orders that remove Mid-Point Peg liquidity). The
proposed rebates are equitably allocated and not unfairly
discriminatory because the rebates will apply equally to all Members.
With respect to the slight increase to the fees charged to add
displayed liquidity in securities priced $1.00 or above, the Exchange
believes that the proposed fees are reasonable, equitably allocated and
not unfairly discriminatory as they are designed to attract additional
removing liquidity to the Exchange. So, while the Exchange is proposing
to increase fees on a per share basis, it is simultaneously providing
higher rebates to all Members for removing liquidity. Thus, although
the change increases the fee for orders that provide liquidity, it
provides an offsetting increase in the rebate for orders removing
liquidity. The tiered pricing structure and reduced fees for Members
that qualify are equitably allocated and not unfairly discriminatory
for the reasons described when the pricing structure was adopted.\10\
---------------------------------------------------------------------------
\10\ See supra note 6.
---------------------------------------------------------------------------
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 is extremely competitive,
Members may choose to preference other market centers ahead of the
Exchange if they believe that they can receive better fees or rebates
elsewhere. Further, such changes are necessarily competitive because
they are intended to provide incentives to Members that will result in
increased activity on the Exchange.
The Exchange also believes that its pricing for removing liquidity
is appropriately competitive vis-[agrave]-vis the Exchange's
competitors, with at least one such competitor, NASDAQ OMX BX, Inc.
(``NASDAQ BX''), offering a similar pricing model.\11\ In a competitive
environment, the Exchange must continually adjust its fees to remain
competitive with other exchanges and alternative liquidity sources.
Because competitors are free to modify their own fees in response, and
because market participants may readily adjust their order routing
practices, the Exchange believes that the degree to which fee changes
in this market may impose any burden on competition is extremely
limited. The proposed changes are, in fact, a direct response to an
adjustment by NASDAQ BX in response to the Exchange's recent change to
its pricing structure.\12\ Thus, the modifications described herein are
a direct response to competition, which should be viewed as a positive
signal that a competitive market exists. If the changes are
unattractive to market participants, it is likely that the Exchange
will lose market share as a result. Accordingly, the Exchange does not
believe that the proposed changes will impair the ability of Members or
competing order execution venues to maintain their competitive standing
in the financial markets. Finally, the Exchange does not believe that
any of
[[Page 21977]]
the changes represent a significant departure from previous pricing
offered by the Exchange or pricing offered by the Exchange's
competitors.
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\11\ See NASDAQ BX Pricing List available at https://www.nasdaqtrader.com/Trader.aspx?id=bx_pricing.
\12\ See Nasdaq Equity Trader Alert 2014-28 available
at https://www.nasdaqtrader.com/TraderNews.aspx?id=ETA2014-28.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \13\ and paragraph (f) of Rule 19b-4
thereunder.\14\ 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.
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\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-BYX-2014-005 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-BYX-2014-005. 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 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-BYX-2014-005 and should be
submitted on or before May 9, 2014.
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\15\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2014-08823 Filed 4-17-14; 8:45 am]
BILLING CODE 8011-01-P