Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the Fees for NYSE MKT Order Imbalances, 1560-1565 [2015-00214]
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Federal Register / Vol. 80, No. 7 / Monday, January 12, 2015 / Notices
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are not Fridays in which monthly or
quarterly options expire.5 These short
term option series may be listed in
strike price intervals of $0.50, $1, or
$2.50 depending on the strike price and
whether the option trades in dollar
increments in the related monthly
expiration.6 Specifically, the Exchange
may list short term option series at
strike price intervals of $0.50 or greater
where the strike price is less than $75,
or for option classes that trade in one
dollar increments in the related nonshort term option, $1 or greater where
the strike price is between $75 and
$150, and $2.50 or greater where the
strike price is above $150.7 During the
month prior to expiration of an option
class that is selected for the Short Term
Option Series Program, the strike price
intervals for the related non-short term
option shall be the same as the strike
price intervals for the short term
option.8
The Exchange also currently operates
a $2.50 Strike Price Program that
permits monthly expiration options in
classes admitted to the $2.50 Strike
Price Program to trade in $2.50 intervals
where the strike price is greater than
$25 but less than $50; or between $50
and $100 if the strikes are no more than
$10 from the closing price of the
underlying stock in its primary market
on the preceding day.9 In certain
instances, these strike price parameters
conflict with the strike prices allowed
for related non-short term options as
dollar strikes between $75 and $100
otherwise allowed under the Short Term
Option Series Program may be within
$0.50 of strikes listed pursuant to the
$2.50 Strike Price Program. As a result,
the Exchange has proposed to amend
Supplementary Material .12 to Rule 504
to extend the $0.50 strike price intervals
currently allowed for short term options
with strike prices less than $75 to short
term options with strike prices less than
$100. With this proposed change, short
term options in non-index option
classes will trade in: (1) $0.50 or greater
intervals for strike prices less than $100,
or for option classes that trade in one
dollar increments in the related nonshort term option; (2) $1 or greater
intervals for strike prices that are
between $100 and $150; and (3) $2.50
or greater intervals for strike prices
above $150.
With regard to the impact of the
proposal on system capacity, the
Exchange states that it has analyzed its
capacity and represents that it and the
Options Price Reporting Authority
(‘‘OPRA’’) have the necessary systems
capacity to handle any potential
additional traffic associated with this
proposed rule change.10 In addition, the
Exchange states that it believes that its
members will not experience a capacity
issue as a result of this proposal.11
Furthermore, the Exchange states that it
does not believe the proposed rule
change will cause fragmentation of
liquidity.12
III. Discussion and Commission
Findings
After careful review, the Commission
finds that the proposed rule change is
consistent with the requirements of the
Act and the rules and regulations
thereunder applicable to a national
securities exchange.13 In particular, the
Commission finds that the proposed
rule change is consistent with Section
6(b)(5) of the Act,14 which requires,
among other things, that the rules of a
national securities exchange be
designed to promote just and equitable
principles of trade, to prevent
fraudulent and manipulative acts, to
remove impediments to and perfect the
mechanism of a free and open market
and a national market system, and, in
general, to protect investors and the
public interest. The Commission
believes that the proposed change may
provide the investing public and other
market participants more flexibility to
closely tailor their investment and
hedging decisions in short term options,
as well as in related non-short term
options, thus allowing them to better
manage their risk exposure.
In approving this proposal, the
Commission notes that the Exchange
has represented that it and OPRA have
the necessary systems capacity to
handle the potential additional traffic
associated with this proposed rule
change.15 The Exchange further stated
that it believes its members will not
have a capacity issue as a result of the
proposal and that it does not believe
this expansion will cause fragmentation
of liquidity.16
10 See
Notice, supra note 4, at 69975.
11 Id.
5 See
6 See
Supplementary Material .02 to ISE Rule 504.
Supplementary Material .12 to ISE Rule 504.
7 Id.
8 See Supplementary Material .02(e) to ISE Rule
504.
9 See ISE Rule 504(g). The term ‘‘primary market’’
is defined in ISE Rule 100(a)(37) as the principal
market in which an underlying security is traded.
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12 Id.
13 In approving the proposed rule change, the
Commission has considered its impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
14 15 U.S.C. 78f(b)(5).
15 See Notice, supra note 4, at 69975.
16 Id.
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IV. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act 17 that the
proposed rule change (SR–ISE–2014–52)
be, and hereby is, approved.
For the Commission, by the Division
of Trading and Markets, pursuant to
delegated authority.18
Brent J. Fields,
Secretary.
[FR Doc. 2015–00218 Filed 1–9–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73995; File No. SR–
NYSEMKT–2014–114]
Self-Regulatory Organizations; NYSE
MKT LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending the Fees for
NYSE MKT Order Imbalances
January 6, 2015.
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
23, 2014, NYSE MKT LLC (‘‘NYSE
MKT’’ or the ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. 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 the
fees for NYSE MKT Order Imbalances to
establish eligibility requirements for
redistribution on a managed nondisplay basis and an access fee for
managed non-display data recipients,
operative on January 1, 2015. The text
of the proposed rule change is available
on the Exchange’s Web site at
www.nyse.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
self-regulatory organization included
17 15
U.S.C. 78f(b)(2).
CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
18 17
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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 those 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
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1. Purpose
The Exchange proposes to establish
eligibility requirements for
redistribution of NYSE MKT Order
Imbalances on a managed non-display
basis and to establish an access fee for
managed non-display data recipients of
NYSE MKT Order Imbalances, operative
January 1, 2015.
Non-Display Use of NYSE MKT
market data means accessing,
processing, or consuming NYSE MKT
market data delivered via direct and/or
Redistributor 3 data feeds for a purpose
other than in support of a data
recipient’s display or further internal or
external redistribution. A Redistributor
approved for Managed Non-Display
Services manages and controls the
access to NYSE MKT Order Imbalances
and does not allow for further internal
distribution or external redistribution of
NYSE MKT Order Imbalances by the
data recipients. Managed Non-Display
Services Fees apply when a data
recipient’s non-display applications are
hosted by a Redistributor that has been
approved for Managed Non-Display
Services.
A Redistributor approved for
Managed Non-Display Services is
required to report to the Exchange on a
monthly basis the data recipients that
are receiving NYSE MKT Order
Imbalances through the Redistributor’s
Managed Non-Display Service. A data
recipient receiving NYSE MKT Order
Imbalances through a Redistributor’s
Managed Non-Display Service does not
have any reporting requirements.
Currently, to be approved for
Managed Non-Display Services, a
Redistributor of the Managed NonDisplay Services must be approved
under the Exchange’s Unit-of-Count
policy.4 The Exchange is proposing to
3 ‘‘Redistributor’’ means a vendor or any other
person that provides an NYSE data product to a
data recipient or to any system that a data recipient
uses, irrespective of the means of transmission or
access.
4 See Securities Exchange Act Release Nos. 61936
(Apr. 16, 2010), 75 FR 21088 (Apr. 22, 2010)(SR–
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retire the Unit-of-Count Policy,5 and as
a result, eligibility for Managed NonDisplay Services of NYSE MKT Order
Imbalances would no longer be based on
eligibility under the Unit-of-Count
Policy. The Exchange proposes instead
to establish eligibility requirements
specifically for the redistribution of
market data for Managed Non-Display
Services. The Exchange also proposes to
add an access fee that would apply to
a data recipient that receives NYSE
MKT Order Imbalances from an
approved Redistributor of Managed
Non-Display Services.
The proposed eligibility requirements
for the provision of Managed NonDisplay Services would be similar to the
eligibility requirements for the Unit-ofCount Policy in that they would require
the Redistributor to manage and control
the access to NYSE MKT Order
Imbalances for data recipients’ nondisplay applications and not allow for
further internal distribution or external
redistribution of the information by data
recipients. In addition, to be eligible to
provide Managed Non-Display Services,
the Redistributor would be required to
(a) host the data recipients’ non-display
applications in equipment located in the
Redistributor’s data center and/or
hosted space/cage and (b) offer NYSE
MKT Order Imbalances in the
Redistributor’s own messaging formats
(rather than using raw NYSE message
formats) by reformatting and/or altering
NYSE MKT Order Imbalances prior to
retransmission without affecting the
integrity of NYSE MKT Order
Imbalances and without rendering
NYSE MKT Order Imbalances
inaccurate, unfair, uninformative,
fictitious, misleading or discriminatory.
The proposed eligibility requirements
are similar to data distribution models
NYSEAmex–2010–30 (notice) and 62187 (May 27,
2010), 75 FR 31500 (June 2, 2014) (SR–NYSEAmex–
2010–35) (approval order) (Unit-of-Count Policy
filing). See also Securities Exchange Act Release
Nos. 69285 (April 3, 2013), 78 FR 21172(Apr. 9,
2013) (SR–NYSEMKT–2013–32) and 72020 (Sept. 9,
2014), 79 FR 55040 (Sept. 15, 2014) (SR–
NYSEMKT–2014–72) (establishing fees for nondisplay use of NYSE MKT Order Imbalances). The
Unit-of-Count Policy currently applies to NYSE
MKT OpenBook, NYSE MKT Trades and NYSE
MKT BBO as a method for counting Users. For
NYSE MKT Order Imbalances, the Policy sets the
criteria for eligibility for Managed Non-Display
Services.
5 The Exchange has separately proposed to retire
the Unit-of-Count Policy and modify the eligibility
requirements for Managed Non-Display Services for
all of its proprietary market data products,
including NYSE MKT Order Imbalances, and
thereby harmonize the eligibility requirements for
all NYSE MKT data products that have Managed
Non-Display fees. See SR–NYSEMKT–2014–113
(amending fees for NYSE MKT OpenBook) and SR–
NYSEMKT–2014–115 (amending fees for NYSE
MKT BBO and NYSE MKT Trades) (collectively,
‘‘NYSE MKT 2014 Filings’’).
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currently in use and align the Exchange
with other markets.6
The reporting requirements associated
with the Managed Non-Display Service
would not change. A Redistributor
approved for Managed Non-Display
Service would be required to report to
the Exchange on a monthly basis the
data recipients that are receiving NYSE
MKT Order Imbalances through the
Redistributor’s Managed Non-Display
Service. A data recipient receiving
NYSE MKT Order Imbalances through a
Redistributor’s Managed Non-Display
Service would continue not to have any
reporting requirements.
In addition, the Exchange proposes to
adopt an Access Fee of $250/month
applicable only to data recipients that
receive NYSE MKT Order Imbalances
from an approved Redistributor of
Managed Non-Display Services,
operative January 1, 2015. Currently, all
data recipients, including recipients of
Managed Non-Display Services, are
required to pay an Access Fee of $500/
month to receive NYSE MKT Order
Imbalances. Because the purpose of an
access fee is to charge data recipients for
access to the Exchange’s proprietary
market data, the Exchange believes it is
appropriate to charge an access fee to all
data recipients.7 In recognition that data
recipients of Managed Non-Display
Services receive NYSE MKT Order
Imbalances in a controlled format, the
Exchange proposes to reduce the Access
Fee by half for those data recipients that
only receive Managed Non-Display
Services for NYSE MKT Order
Imbalances. In connection with this
change, the Exchange also proposes to
amend the NYSE MKT LLC Equities
Proprietary Market Data Fees Schedule
to specify that the current Access Fee of
$500/month is charged to data
recipients other than those receiving
data through Managed Non-Display
Services. The proposed Managed Non6 See Securities Exchange Act Release Nos. 70748
(Oct. 23, 2013), 70748 (Oct. 23, 2013), 78 FR 64569
(Oct. 29, 2013) (SR–Phlx–2013–105) (notice of filing
and immediate effectiveness of proposed rule
change to establish non-display Managed Data
Solution for NASDAQ OMX Phlx (‘‘Phlx’’)); 70269
(Aug. 27, 2013), 78 FR 54336 (Sept. 3, 2013) (SR–
NASDAQ–2013–106) (notice of filing and
immediate effectiveness of proposed rule change to
establish non-display Managed Data Solution for
NASDAQ Stock Market (‘‘NASDAQ’’)); and 69182
(Mar. 19, 2013), 78 FR 18378 (Mar. 26, 2013) (SR–
Phlx–2013–28) (notice of filing and immediate
effectiveness of proposed rule change to establish
non-display Managed Data Solution for Phlx
equities market PSX).
7 In order to harmonize its approach to fees for
its market data products, the Exchange is proposing
to establish access fees for Managed Non-Display
Services for NYSE MKT OpenBook, NYSE MKT
BBO, and NYSE MKT Trades that is also half of the
existing access fee for each respective data feed. See
NYSE MKT 2014 Filings, supra note 5.
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Display Access Fee would be in
addition to the current Managed NonDisplay Services Fee of $100/month by
each data recipient.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the provisions of Section 6 of the Act,8
in general, and Sections 6(b)(4) and
6(b)(5) of the Act,9 in particular, in that
it provides an equitable allocation of
reasonable fees among users and
recipients of the data and is not
designed to permit unfair
discrimination among customers,
issuers, and brokers.
The Exchange believes that revising
the eligibility requirements for Managed
Non-Display Services so that the
requirements are more closely aligned
with the nature of the services being
provided is reasonable. The proposed
additional requirements for hosting in
the Redistributor’s data center and for
reformatting and/or altering the market
data prior to retransmission are also
consistent with similar requirements of
other markets for the provision of
managed data.10
The Exchange believes that the
proposed Access Fee for Managed NonDisplay Services is reasonable, because
the data is of value to recipients, and it
is reasonable to charge them a lower
access fee because they are receiving the
data through a Redistributor in a
controlled form rather than from the
Exchange in raw form. The Exchange
believes that the proposed fee directly
and appropriately reflects the significant
value of using non-display data in a
wide range of computer-automated
functions relating to both trading and
non-trading activities and that the
number and range of these functions
continue to grow through innovation
and technology developments.
NASDAQ and Phlx also both offer
managed non-display data solutions and
charge access fees for such services.11
The fee is also equitable and not
unfairly discriminatory because it
8 15
U.S.C. 78f(b).
U.S.C. 78f(b)(4), (5).
10 See supra note 6.
11 See supra note 6. NASDAQ offers a Managed
Data Solution that assesses a monthly Managed
Data Solution Administration fee of $1,500 and
monthly Subscriber fees of $60 for nonprofessionals to $300 for professionals. See
NASDAQ Rule 7026(b). Phlx charges a monthly
Managed Data Solution Administration fee of
$2,000 and a monthly Subscriber fee of $500. The
monthly License fee is in addition to the monthly
Distributor fee of $3,500 (for external usage), and
the $500 monthly Subscriber fee is assessed for
each Subscriber of a Managed Data Solution. See
Securities Exchange Act Release No. 70748 (Oct. 23,
2013), 78 FR 64569 (Oct. 29, 2013) (SR–Phlx–2013–
105).
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would apply to all data recipients that
choose to subscribe to Managed NonDisplay Services for NYSE MKT Order
Imbalances.
The fees are also equitable and not
unfairly discriminatory because they
will apply to all data recipients that
choose to subscribe to the feeds.
The Exchange notes that NYSE MKT
Order Imbalances is entirely optional.
The Exchange is not required to make
NYSE MKT Order Imbalances available
or to offer any specific pricing
alternatives to any customers, nor is any
firm required to purchase NYSE MKT
Order Imbalances. Firms that do
purchase NYSE MKT Order Imbalances
do so for the primary goals of using it
to increase revenues, reduce expenses,
and in some instances compete directly
with the Exchange (including for order
flow); those firms are able to determine
for themselves whether NYSE MKT
Order Imbalances or any other similar
products are attractively priced or not.
The Exchange notes that brokerdealers are not required to purchase
proprietary market data to comply with
their best execution obligations.12
Similarly, there is no requirement in
Regulation NMS or any other rule that
proprietary data be utilized for order
routing decisions, and some brokerdealers and alternative trading systems
(‘‘ATSs’’) have chosen not to do so.13
Firms that do not wish to purchase
NYSE MKT Order Imbalances at the
new price can choose similar alternative
products,14 or can choose to conduct
their business operations in ways that
do not use NYSE MKT Order
Imbalances data.
The decision of the United States
Court of Appeals for the District of
Columbia Circuit in NetCoalition v.
SEC, 615 F.3d 525 (D.C. Cir. 2010),
upheld reliance by the Securities and
Exchange Commission (‘‘Commission’’)
upon the existence of competitive
market mechanisms to set reasonable
and equitably allocated fees for
proprietary market data:
12 See In the Matter of the Application of
Securities Industry And Financial Markets
Association For Review of Actions Taken by SelfRegulatory Organizations, Release Nos. 34–72182;
AP–3–15350; AP–3–15351 (May 16, 2014).
13 For example, Goldman Sachs Execution and
Clearing, L.P. has disclosed that it does not use
proprietary market data in connection with Sigma
X, its ATS. See response to Question E3, available
at https://www.goldmansachs.com/media-relations/
in-the-news/current/pdf-media/gsec-orderhandling-practices-ats-specific.pdf. By way of
comparison, IEX has disclosed that it uses
proprietary market data feeds from all registered
stock exchanges and LavaFlow ECN. See https://
www.iextrading.com/about/.
14 See NASDAQ Rule 7023 (Nasdaq Totalview
and Openview).
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In fact, the legislative history indicates that
the Congress intended that the market system
‘evolve through the interplay of competitive
forces as unnecessary regulatory restrictions
are removed’ and that the SEC wield its
regulatory power ‘in those situations where
competition may not be sufficient,’ such as
in the creation of a ‘consolidated
transactional reporting system.’
Id. at 535 (quoting H.R. Rep. No. 94–229
at 92 (1975), as reprinted in 1975
U.S.C.C.A.N. 323). The court agreed
with the Commission’s conclusion that
‘‘Congress intended that ‘competitive
forces should dictate the services and
practices that constitute the U.S.
national market system for trading
equity securities.’ ’’ 15
As explained below in the Exchange’s
Statement on Burden on Competition,
the Exchange believes that there is
substantial evidence of competition in
the marketplace for proprietary market
data and that the Commission can rely
upon such evidence in concluding that
the fees established in this filing are the
product of competition and therefore
satisfy the relevant statutory standards.
As the NetCoalition decision noted,
the Commission is not required to
undertake a cost-of-service or
ratemaking approach. The Exchange
believes that, even if it were possible as
a matter of economic theory, cost-based
pricing for non-core market data would
be so complicated that it could not be
done practically or offer any significant
benefits.16
For these reasons, the Exchange
believes that the proposed fees are
reasonable, equitable, and not unfairly
discriminatory.
15 NetCoalition,
615 F.3d at 535.
Exchange believes that cost-based pricing
would be impractical because it would create
enormous administrative burdens for all parties,
including the Commission, to cost-regulate a large
number of participants and standardize and analyze
extraordinary amounts of information, accounts,
and reports. In addition, and as described below, it
is impossible to regulate market data prices in
isolation from prices charged by markets for other
services that are joint products. Cost-based rate
regulation would also lead to litigation and may
distort incentives, including those to minimize
costs and to innovate, leading to further waste.
Under cost-based pricing, the Commission would
be burdened with determining a fair rate of return,
and the industry could experience frequent rate
increases based on escalating expense levels. Even
in industries historically subject to utility
regulation, cost-based ratemaking has been
discredited. As such, the Exchange believes that
cost-based ratemaking would be inappropriate for
proprietary market data and inconsistent with
Congress’s direction that the Commission use its
authority to foster the development of the national
market system, and that market forces will continue
to provide appropriate pricing discipline. See
Appendix C to NYSE’s comments to the
Commission’s 2000 Concept Release on the
Regulation of Market Information Fees and
Revenues, which can be found on the Commission’s
Web site at https://www.sec.gov/rules/concept/
s72899/buck1.htm.
16 The
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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 that is not
necessary or appropriate in furtherance
of the purposes of the Act. An
exchange’s ability to price its
proprietary market data feed products is
constrained by actual competition for
the sale of proprietary market data
products, the joint product nature of
exchange platforms, and the existence of
alternatives to the Exchange’s
proprietary data.
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The Existence of Actual Competition
The market for proprietary data
products is currently competitive and
inherently contestable because there is
fierce competition for the inputs
necessary for the creation of proprietary
data and strict pricing discipline for the
proprietary products themselves.
Numerous exchanges compete with one
another for listings and order flow and
sales of market data itself, providing
ample opportunities for entrepreneurs
who wish to compete in any or all of
those areas, including producing and
distributing their own market data.
Proprietary data products are produced
and distributed by each individual
exchange, as well as other entities, in a
vigorously competitive market. Indeed,
the U.S. Department of Justice (‘‘DOJ’’)
(the primary antitrust regulator) has
expressly acknowledged the aggressive
actual competition among exchanges,
including for the sale of proprietary
market data. In 2011, the DOJ stated that
exchanges ‘‘compete head to head to
offer real-time equity data products.
These data products include the best bid
and offer of every exchange and
information on each equity trade,
including the last sale.’’ 17
Moreover, competitive markets for
listings, order flow, executions, and
transaction reports provide pricing
discipline for the inputs of proprietary
data products and therefore constrain
markets from overpricing proprietary
market data. Broker-dealers send their
order flow and transaction reports to
multiple venues, rather than providing
them all to a single venue, which in turn
reinforces this competitive constraint.
17 Press Release, U.S. Department of Justice,
Assistant Attorney General Christine Varney Holds
Conference Call Regarding NASDAQ OMX Group
Inc. and IntercontinentalExchange Inc. Abandoning
Their Bid for NYSE Euronext (May 16, 2011),
available at https://www.justice.gov/iso/opa/atr/
speeches/2011/at-speech-110516.html; see also
Complaint in U.S. v. Deutsche Borse AG and NYSE
Euronext, Case No. 11–cv–2280 (D.C. Dist.) ¶ 24
(‘‘NYSE and Direct Edge compete head-to-head . . .
in the provision of real-time proprietary equity data
products.’’).
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As a 2010 Commission Concept Release
noted, the ‘‘current market structure can
be described as dispersed and complex’’
with ‘‘trading volume . . . dispersed
among many highly automated trading
centers that compete for order flow in
the same stocks’’ and ‘‘trading centers
offer[ing] a wide range of services that
are designed to attract different types of
market participants with varying trading
needs.’’ 18 More recently, SEC Chair
Mary Jo White has noted that
competition for order flow in exchangelisted equities is ‘‘intense’’ and divided
among many trading venues, including
exchanges, more than 40 alternative
trading systems, and more than 250
broker-dealers.19
If an exchange succeeds in its
competition for quotations, order flow,
and trade executions, then it earns
trading revenues and increases the value
of its proprietary market data products
because they will contain greater quote
and trade information. Conversely, if an
exchange is less successful in attracting
quotes, order flow, and trade
executions, then its market data
products may be less desirable to
customers using them in support of
order routing and trading decisions in
light of the diminished content; data
products offered by competing venues
may become correspondingly more
attractive. Thus, competition for
quotations, order flow, and trade
executions puts significant pressure on
an exchange to maintain both execution
and data fees at reasonable levels.
In addition, in the case of products
that are distributed through market data
vendors, such as Bloomberg and
Thompson Reuters, the vendors
themselves provide additional price
discipline for proprietary data products
because they control the primary means
of access to certain end users. These
vendors impose price discipline based
upon their business models. For
example, vendors that assess a
18 Concept Release on Equity Market Structure,
Securities Exchange Act Release No. 61358 (Jan. 14,
2010), 75 FR 3594 (Jan. 21, 2010) (File No. S7–02–
10). This Concept Release included data from the
third quarter of 2009 showing that no market center
traded more than 20% of the volume of listed
stocks, further evidencing the dispersal of and
competition for trading activity. Id. at 3598. Data
available on ArcaVision show that from June 30,
2013 to June 30, 2014, no exchange traded more
than 12% of the volume of listed stocks by either
trade or dollar volume, further evidencing the
continued dispersal of and fierce competition for
trading activity. See https://www.arcavision.com/
Arcavision/arcalogin.jsp.
19 Mary Jo White, Enhancing Our Equity Market
Structure, Sandler O’Neill & Partners, L.P. Global
Exchange and Brokerage Conference (June 5, 2014)
(available on the Commission Web site), citing
Tuttle, Laura, 2014, ‘‘OTC Trading: Description of
Non-ATS OTC Trading in National Market System
Stocks,’’ at 7–8.
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1563
surcharge on data they sell are able to
refuse to offer proprietary products that
their end users do not or will not
purchase in sufficient numbers. Vendors
will not elect to make available NYSE
MKT Order Imbalances unless their
customers request it, and customers will
not elect to pay the proposed fees unless
NYSE MKT Order Imbalances can
provide value by sufficiently increasing
revenues or reducing costs in the
customer’s business in a manner that
will offset the fees. All of these factors
operate as constraints on pricing
proprietary data products.
Joint Product Nature of Exchange
Platform
Transaction execution and proprietary
data products are complementary in that
market data is both an input and a
byproduct of the execution service. In
fact, proprietary market data and trade
executions are a paradigmatic example
of joint products with joint costs. The
decision of whether and on which
platform to post an order will depend
on the attributes of the platforms where
the order can be posted, including the
execution fees, data availability and
quality, and price and distribution of
their data products. Without a platform
to post quotations, receive orders, and
execute trades, exchange data products
would not exist.
The costs of producing market data
include not only the costs of the data
distribution infrastructure, but also the
costs of designing, maintaining, and
operating the exchange’s platform for
posting quotes, accepting orders, and
executing transactions and the cost of
regulating the exchange to ensure its fair
operation and maintain investor
confidence. The total return that a
trading platform earns reflects the
revenues it receives from both products
and the joint costs it incurs.
Moreover, an exchange’s brokerdealer customers generally view the
costs of transaction executions and
market data as a unified cost of doing
business with the exchange. A brokerdealer will only choose to direct orders
to an exchange if the revenue from the
transaction exceeds its cost, including
the cost of any market data that the
broker-dealer chooses to buy in support
of its order routing and trading
decisions. If the costs of the transaction
are not offset by its value, then the
broker-dealer may choose instead not to
purchase the product and trade away
from that exchange. There is substantial
evidence of the strong correlation
between order flow and market data
purchases. For example, in November
2014 more than 80% of the transaction
volume on each of NYSE MKT, and the
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NYSE’s affiliates, New York Stock
Exchange LLC (‘‘NYSE’’) and NYSE
Arca, Inc. (‘‘NYSE Arca’’), was executed
by market participants that purchased
one or more proprietary market data
products (the 20 firms were not the
same for each market). A supracompetitive increase in the fees for
either executions or market data would
create a risk of reducing an exchange’s
revenues from both products.
Other market participants have noted
that proprietary market data and trade
executions are joint products of a joint
platform and have common costs.20 The
Exchange agrees with and adopts those
discussions and the arguments therein.
The Exchange also notes that the
economics literature confirms that there
is no way to allocate common costs
between joint products that would shed
any light on competitive or efficient
pricing.21
Analyzing the cost of market data
product production and distribution in
isolation from the cost of all of the
inputs supporting the creation of market
data and market data products will
inevitably underestimate the cost of the
data and data products because it is
impossible to obtain the data inputs to
create market data products without a
fast, technologically robust, and wellregulated execution system, and system
and regulatory costs affect the price of
both obtaining the market data itself and
creating and distributing market data
20 See Securities Exchange Act Release No. 72153
(May 12, 2014), 79 FR 28575, 28578 n.15 (May 16,
2014) (SR–NASDAQ–2014–045) (‘‘[A]ll of the
exchange’s costs are incurred for the unified
purposes of attracting order flow, executing and/or
routing orders, and generating and selling data
about market activity. The total return that an
exchange earns reflects the revenues it receives
from the joint products and the total costs of the
joint products.’’). See also Securities Exchange Act
Release No. 62907 (Sept. 14, 2010), 75 FR 57314,
57317 (Sept. 20, 2010) (SR–NASDAQ–2010–110),
and Securities Exchange Act Release No. 62908
(Sept. 14, 2010), 75 FR 57321, 57324 (Sept. 20,
2010) (SR–NASDAQ–2010–111).
21 See generally Mark Hirschey, Fundamentals of
Managerial Economics, at 600 (2009) (‘‘It is
important to note, however, that although it is
possible to determine the separate marginal costs of
goods produced in variable proportions, it is
impossible to determine their individual average
costs. This is because common costs are expenses
necessary for manufacture of a joint product.
Common costs of production—raw material and
equipment costs, management expenses, and other
overhead—cannot be allocated to each individual
by-product on any economically sound basis. . . .
Any allocation of common costs is wrong and
arbitrary.’’). This is not new economic theory. See,
e.g., F. W. Taussig, ‘‘A Contribution to the Theory
of Railway Rates,’’ Quarterly Journal of Economics
V(4) 438, 465 (July 1891) (‘‘Yet, surely, the division
is purely arbitrary. These items of cost, in fact, are
jointly incurred for both sorts of traffic; and I cannot
share the hope entertained by the statistician of the
Commission, Professor Henry C. Adams, that we
shall ever reach a mode of apportionment that will
lead to trustworthy results.’’).
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products. It would be equally
misleading, however, to attribute all of
an exchange’s costs to the market data
portion of an exchange’s joint products.
Rather, all of an exchange’s costs are
incurred for the unified purposes of
attracting order flow, executing and/or
routing orders, and generating and
selling data about market activity. The
total return that an exchange earns
reflects the revenues it receives from the
joint products and the total costs of the
joint products.
As noted above, the level of
competition and contestability in the
market is evident in the numerous
alternative venues that compete for
order flow, including 12 equities selfregulatory organization (‘‘SRO’’)
markets, as well as various forms of
ATSs, including dark pools and
electronic communication networks
(‘‘ECNs’’), and internalizing brokerdealers. SRO markets compete to attract
order flow and produce transaction
reports via trade executions, and two
FINRA-regulated Trade Reporting
Facilities compete to attract transaction
reports from the non-SRO venues.22
Competition among trading platforms
can be expected to constrain the
aggregate return that each platform
earns from the sale of its joint products,
but different trading platforms may
choose from a range of possible, and
equally reasonable, pricing strategies as
the means of recovering total costs. For
example, some platforms may choose to
pay rebates to attract orders, charge
relatively low prices for market data
products (or provide market data
products free of charge), and charge
relatively high prices for accessing
posted liquidity. Other platforms may
choose a strategy of paying lower
rebates (or no rebates) to attract orders,
setting relatively high prices for market
data products, and setting relatively low
prices for accessing posted liquidity. For
example, BATS and Direct Edge, which
previously operated as ATSs and
obtained exchange status in 2008 and
2010, respectively, have provided
certain market data at no charge on their
Web sites in order to attract more order
flow, and use revenue rebates from
resulting additional executions to
maintain low execution charges for their
users.23 Similarly, LavaFlow ECN
22 FINRA’s Alternative Display Facility also
receives over-the-counter trade reports that it sends
to CTA.
23 This is simply a securities market-specific
example of the well-established principle that in
certain circumstances more sales at lower margins
can be more profitable than fewer sales at higher
margins; this example is additional evidence that
market data is an inherent part of a market’s joint
platform.
PO 00000
Frm 00072
Fmt 4703
Sfmt 4703
provides market data to its subscribers
at no charge.24 In this environment,
there is no economic basis for regulating
maximum prices for one of the joint
products in an industry in which
suppliers face competitive constraints
with regard to the joint offering.
Existence of Alternatives
The large number of SROs, ATSs, and
internalizing broker-dealers that
currently produce proprietary data or
are currently capable of producing it
provides further pricing discipline for
proprietary data products. Each SRO,
ATS, and broker-dealer is currently
permitted to produce and sell
proprietary data products, and many
currently do or have announced plans to
do so, including but not limited to the
Exchange, NYSE, NYSE Arca, NASDAQ
OMX, BATS, and Direct Edge.
The fact that proprietary data from
ATSs, internalizing broker-dealers, and
vendors can bypass SROs is significant
in two respects. First, non-SROs can
compete directly with SROs for the
production and sale of proprietary data
products. By way of example, BATS and
NYSE Arca both published proprietary
data on the Internet before registering as
exchanges. Second, because a single
order or transaction report can appear in
an SRO proprietary product, a non-SRO
proprietary product, or both, the amount
of data available via proprietary
products is greater in size than the
actual number of orders and transaction
reports that exist in the marketplace.
With respect to NYSE MKT Order
Imbalances, competitors offer similar
data.25 Because market data users can
find suitable substitutes for most
proprietary market data products, a
market that overprices its market data
products stands a high risk that users
may substitute another source of market
data information for its own.
Those competitive pressures imposed
by available alternatives are evident in
the Exchange’s proposed pricing, and
indeed in the fact that the changes here
have the effect of lowering the price for
NYSE MKT Order Imbalances.
In addition to the competition and
price discipline described above, the
market for proprietary data products is
also highly contestable because market
entry is rapid and inexpensive. The
history of electronic trading is replete
with examples of entrants that swiftly
grew into some of the largest electronic
trading platforms and proprietary data
producers: Archipelago, Bloomberg
24 See ‘‘LavaFlow—ADF Migration,’’ available at
https://www.lavatrading.com/news/pdf/LavaFlow_
ADF_Migration.pdf.
25 See supra note 14.
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Federal Register / Vol. 80, No. 7 / Monday, January 12, 2015 / Notices
Tradebook, Island, RediBook, Attain,
TrackECN, BATS Trading and Direct
Edge. As noted above, BATS launched
as an ATS in 2006 and became an
exchange in 2008, while Direct Edge
began operations in 2007 and obtained
exchange status in 2010. As noted
above, LavaFlow ECN provides market
data to its subscribers at no charge.26
In setting the proposed fees, the
Exchange considered the
competitiveness of the market for
proprietary data and all of the
implications of that competition. The
Exchange believes that it has considered
all relevant factors and has not
considered irrelevant factors in order to
establish fair, reasonable, and not
unreasonably discriminatory fees and an
equitable allocation of fees among all
users. The existence of numerous
alternatives to the Exchange’s products,
including proprietary data from other
sources, ensures that the Exchange
cannot set unreasonable fees, or fees
that are unreasonably discriminatory,
when vendors and subscribers can elect
these alternatives or choose not to
purchase a specific proprietary data
product if the attendant fees are not
justified by the returns that any
particular vendor or data recipient
would achieve through the purchase.
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 with respect to the proposed
rule change.
tkelley on DSK3SPTVN1PROD with NOTICES
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)(ii) of the Act27 and
paragraph (f)(2) of Rule 19b–4
thereunder.28 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:
SECURITIES AND EXCHANGE
COMMISSION
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–
NYSEMKT–2014–114 on the subject
line.
[Release No. 34–74004; File No. SR–ISE–
2014–56]
Self-Regulatory Organizations;
International Securities Exchange,
LLC; Notice of Filing and Immediate
Effectiveness of a Proposed Rule
Change Regarding Complex Orders
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–NYSEMKT–2014–114. 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 NYSE MKT. 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–
NYSEMKT–2014–114 and should be
submitted on or before February 2, 2015.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.29
Brent J. Fields,
Secretary.
[FR Doc. 2015–00214 Filed 1–9–15; 8:45 am]
supra note 24.
U.S.C. 78s(b)(3)(A)(ii).
28 17 CFR 240.19b–4(f)(2).
27 15
VerDate Sep<11>2014
17:35 Jan 09, 2015
January 6, 2015.
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
23, 2014 the International Securities
Exchange, LLC (the ‘‘Exchange’’ or the
‘‘ISE’’) filed with the Securities and
Exchange Commission the proposed
rule change, as described in Items I and
II 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 ISE proposes to amend its rules
to permit a greater number of complex
orders to leg into the regular market.
The text of the proposed rule change is
available on the Exchange’s Web site
(https://www.ise.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
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
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The purpose of this proposed rule
change is to permit a greater number of
complex orders to leg into the regular
market. The Exchange currently
BILLING CODE 8011–01–P
26 See
1 15
29 17
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1565
PO 00000
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Frm 00073
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2 17
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
12JAN1
]]>Agencies
[Federal Register Volume 80, Number 7 (Monday, January 12, 2015)]
[Notices]
[Pages 1560-1565]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-00214]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73995; File No. SR-NYSEMKT-2014-114]
Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and
Immediate Effectiveness of Proposed Rule Change Amending the Fees for
NYSE MKT Order Imbalances
January 6, 2015.
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 23, 2014, NYSE MKT LLC (``NYSE MKT'' or the
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend the fees for NYSE MKT Order
Imbalances to establish eligibility requirements for redistribution on
a managed non-display basis and an access fee for managed non-display
data recipients, operative on January 1, 2015. The text of the proposed
rule change is available on the Exchange's Web site at www.nyse.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 self-regulatory organization
included
[[Page 1561]]
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 those 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 establish eligibility requirements for
redistribution of NYSE MKT Order Imbalances on a managed non-display
basis and to establish an access fee for managed non-display data
recipients of NYSE MKT Order Imbalances, operative January 1, 2015.
Non-Display Use of NYSE MKT market data means accessing,
processing, or consuming NYSE MKT market data delivered via direct and/
or Redistributor \3\ data feeds for a purpose other than in support of
a data recipient's display or further internal or external
redistribution. A Redistributor approved for Managed Non-Display
Services manages and controls the access to NYSE MKT Order Imbalances
and does not allow for further internal distribution or external
redistribution of NYSE MKT Order Imbalances by the data recipients.
Managed Non-Display Services Fees apply when a data recipient's non-
display applications are hosted by a Redistributor that has been
approved for Managed Non-Display Services.
---------------------------------------------------------------------------
\3\ ``Redistributor'' means a vendor or any other person that
provides an NYSE data product to a data recipient or to any system
that a data recipient uses, irrespective of the means of
transmission or access.
---------------------------------------------------------------------------
A Redistributor approved for Managed Non-Display Services is
required to report to the Exchange on a monthly basis the data
recipients that are receiving NYSE MKT Order Imbalances through the
Redistributor's Managed Non-Display Service. A data recipient receiving
NYSE MKT Order Imbalances through a Redistributor's Managed Non-Display
Service does not have any reporting requirements.
Currently, to be approved for Managed Non-Display Services, a
Redistributor of the Managed Non-Display Services must be approved
under the Exchange's Unit-of-Count policy.\4\ The Exchange is proposing
to retire the Unit-of-Count Policy,\5\ and as a result, eligibility for
Managed Non-Display Services of NYSE MKT Order Imbalances would no
longer be based on eligibility under the Unit-of-Count Policy. The
Exchange proposes instead to establish eligibility requirements
specifically for the redistribution of market data for Managed Non-
Display Services. The Exchange also proposes to add an access fee that
would apply to a data recipient that receives NYSE MKT Order Imbalances
from an approved Redistributor of Managed Non-Display Services.
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release Nos. 61936 (Apr. 16,
2010), 75 FR 21088 (Apr. 22, 2010)(SR-NYSEAmex-2010-30 (notice) and
62187 (May 27, 2010), 75 FR 31500 (June 2, 2014) (SR-NYSEAmex-2010-
35) (approval order) (Unit-of-Count Policy filing). See also
Securities Exchange Act Release Nos. 69285 (April 3, 2013), 78 FR
21172(Apr. 9, 2013) (SR-NYSEMKT-2013-32) and 72020 (Sept. 9, 2014),
79 FR 55040 (Sept. 15, 2014) (SR-NYSEMKT-2014-72) (establishing fees
for non-display use of NYSE MKT Order Imbalances). The Unit-of-Count
Policy currently applies to NYSE MKT OpenBook, NYSE MKT Trades and
NYSE MKT BBO as a method for counting Users. For NYSE MKT Order
Imbalances, the Policy sets the criteria for eligibility for Managed
Non-Display Services.
\5\ The Exchange has separately proposed to retire the Unit-of-
Count Policy and modify the eligibility requirements for Managed
Non-Display Services for all of its proprietary market data
products, including NYSE MKT Order Imbalances, and thereby harmonize
the eligibility requirements for all NYSE MKT data products that
have Managed Non-Display fees. See SR-NYSEMKT-2014-113 (amending
fees for NYSE MKT OpenBook) and SR-NYSEMKT-2014-115 (amending fees
for NYSE MKT BBO and NYSE MKT Trades) (collectively, ``NYSE MKT 2014
Filings'').
---------------------------------------------------------------------------
The proposed eligibility requirements for the provision of Managed
Non-Display Services would be similar to the eligibility requirements
for the Unit-of-Count Policy in that they would require the
Redistributor to manage and control the access to NYSE MKT Order
Imbalances for data recipients' non-display applications and not allow
for further internal distribution or external redistribution of the
information by data recipients. In addition, to be eligible to provide
Managed Non-Display Services, the Redistributor would be required to
(a) host the data recipients' non-display applications in equipment
located in the Redistributor's data center and/or hosted space/cage and
(b) offer NYSE MKT Order Imbalances in the Redistributor's own
messaging formats (rather than using raw NYSE message formats) by
reformatting and/or altering NYSE MKT Order Imbalances prior to
retransmission without affecting the integrity of NYSE MKT Order
Imbalances and without rendering NYSE MKT Order Imbalances inaccurate,
unfair, uninformative, fictitious, misleading or discriminatory. The
proposed eligibility requirements are similar to data distribution
models currently in use and align the Exchange with other markets.\6\
---------------------------------------------------------------------------
\6\ See Securities Exchange Act Release Nos. 70748 (Oct. 23,
2013), 70748 (Oct. 23, 2013), 78 FR 64569 (Oct. 29, 2013) (SR-Phlx-
2013-105) (notice of filing and immediate effectiveness of proposed
rule change to establish non-display Managed Data Solution for
NASDAQ OMX Phlx (``Phlx'')); 70269 (Aug. 27, 2013), 78 FR 54336
(Sept. 3, 2013) (SR-NASDAQ-2013-106) (notice of filing and immediate
effectiveness of proposed rule change to establish non-display
Managed Data Solution for NASDAQ Stock Market (``NASDAQ'')); and
69182 (Mar. 19, 2013), 78 FR 18378 (Mar. 26, 2013) (SR-Phlx-2013-28)
(notice of filing and immediate effectiveness of proposed rule
change to establish non-display Managed Data Solution for Phlx
equities market PSX).
---------------------------------------------------------------------------
The reporting requirements associated with the Managed Non-Display
Service would not change. A Redistributor approved for Managed Non-
Display Service would be required to report to the Exchange on a
monthly basis the data recipients that are receiving NYSE MKT Order
Imbalances through the Redistributor's Managed Non-Display Service. A
data recipient receiving NYSE MKT Order Imbalances through a
Redistributor's Managed Non-Display Service would continue not to have
any reporting requirements.
In addition, the Exchange proposes to adopt an Access Fee of $250/
month applicable only to data recipients that receive NYSE MKT Order
Imbalances from an approved Redistributor of Managed Non-Display
Services, operative January 1, 2015. Currently, all data recipients,
including recipients of Managed Non-Display Services, are required to
pay an Access Fee of $500/month to receive NYSE MKT Order Imbalances.
Because the purpose of an access fee is to charge data recipients for
access to the Exchange's proprietary market data, the Exchange believes
it is appropriate to charge an access fee to all data recipients.\7\ In
recognition that data recipients of Managed Non-Display Services
receive NYSE MKT Order Imbalances in a controlled format, the Exchange
proposes to reduce the Access Fee by half for those data recipients
that only receive Managed Non-Display Services for NYSE MKT Order
Imbalances. In connection with this change, the Exchange also proposes
to amend the NYSE MKT LLC Equities Proprietary Market Data Fees
Schedule to specify that the current Access Fee of $500/month is
charged to data recipients other than those receiving data through
Managed Non-Display Services. The proposed Managed Non-
[[Page 1562]]
Display Access Fee would be in addition to the current Managed Non-
Display Services Fee of $100/month by each data recipient.
---------------------------------------------------------------------------
\7\ In order to harmonize its approach to fees for its market
data products, the Exchange is proposing to establish access fees
for Managed Non-Display Services for NYSE MKT OpenBook, NYSE MKT
BBO, and NYSE MKT Trades that is also half of the existing access
fee for each respective data feed. See NYSE MKT 2014 Filings, supra
note 5.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\8\ in general, and
Sections 6(b)(4) and 6(b)(5) of the Act,\9\ in particular, in that it
provides an equitable allocation of reasonable fees among users and
recipients of the data and is not designed to permit unfair
discrimination among customers, issuers, and brokers.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(4), (5).
---------------------------------------------------------------------------
The Exchange believes that revising the eligibility requirements
for Managed Non-Display Services so that the requirements are more
closely aligned with the nature of the services being provided is
reasonable. The proposed additional requirements for hosting in the
Redistributor's data center and for reformatting and/or altering the
market data prior to retransmission are also consistent with similar
requirements of other markets for the provision of managed data.\10\
---------------------------------------------------------------------------
\10\ See supra note 6.
---------------------------------------------------------------------------
The Exchange believes that the proposed Access Fee for Managed Non-
Display Services is reasonable, because the data is of value to
recipients, and it is reasonable to charge them a lower access fee
because they are receiving the data through a Redistributor in a
controlled form rather than from the Exchange in raw form. The Exchange
believes that the proposed fee directly and appropriately reflects the
significant value of using non-display data in a wide range of
computer-automated functions relating to both trading and non-trading
activities and that the number and range of these functions continue to
grow through innovation and technology developments. NASDAQ and Phlx
also both offer managed non-display data solutions and charge access
fees for such services.\11\ The fee is also equitable and not unfairly
discriminatory because it would apply to all data recipients that
choose to subscribe to Managed Non-Display Services for NYSE MKT Order
Imbalances.
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\11\ See supra note 6. NASDAQ offers a Managed Data Solution
that assesses a monthly Managed Data Solution Administration fee of
$1,500 and monthly Subscriber fees of $60 for non-professionals to
$300 for professionals. See NASDAQ Rule 7026(b). Phlx charges a
monthly Managed Data Solution Administration fee of $2,000 and a
monthly Subscriber fee of $500. The monthly License fee is in
addition to the monthly Distributor fee of $3,500 (for external
usage), and the $500 monthly Subscriber fee is assessed for each
Subscriber of a Managed Data Solution. See Securities Exchange Act
Release No. 70748 (Oct. 23, 2013), 78 FR 64569 (Oct. 29, 2013) (SR-
Phlx-2013-105).
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The fees are also equitable and not unfairly discriminatory because
they will apply to all data recipients that choose to subscribe to the
feeds.
The Exchange notes that NYSE MKT Order Imbalances is entirely
optional. The Exchange is not required to make NYSE MKT Order
Imbalances available or to offer any specific pricing alternatives to
any customers, nor is any firm required to purchase NYSE MKT Order
Imbalances. Firms that do purchase NYSE MKT Order Imbalances do so for
the primary goals of using it to increase revenues, reduce expenses,
and in some instances compete directly with the Exchange (including for
order flow); those firms are able to determine for themselves whether
NYSE MKT Order Imbalances or any other similar products are
attractively priced or not.
The Exchange notes that broker-dealers are not required to purchase
proprietary market data to comply with their best execution
obligations.\12\ Similarly, there is no requirement in Regulation NMS
or any other rule that proprietary data be utilized for order routing
decisions, and some broker-dealers and alternative trading systems
(``ATSs'') have chosen not to do so.\13\ Firms that do not wish to
purchase NYSE MKT Order Imbalances at the new price can choose similar
alternative products,\14\ or can choose to conduct their business
operations in ways that do not use NYSE MKT Order Imbalances data.
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\12\ See In the Matter of the Application of Securities Industry
And Financial Markets Association For Review of Actions Taken by
Self-Regulatory Organizations, Release Nos. 34-72182; AP-3-15350;
AP-3-15351 (May 16, 2014).
\13\ For example, Goldman Sachs Execution and Clearing, L.P. has
disclosed that it does not use proprietary market data in connection
with Sigma X, its ATS. See response to Question E3, available at
https://www.goldmansachs.com/media-relations/in-the-news/current/pdf-media/gsec-order-handling-practices-ats-specific.pdf. By way of
comparison, IEX has disclosed that it uses proprietary market data
feeds from all registered stock exchanges and LavaFlow ECN. See
https://www.iextrading.com/about/.
\14\ See NASDAQ Rule 7023 (Nasdaq Totalview and Openview).
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The decision of the United States Court of Appeals for the District
of Columbia Circuit in NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir.
2010), upheld reliance by the Securities and Exchange Commission
(``Commission'') upon the existence of competitive market mechanisms to
set reasonable and equitably allocated fees for proprietary market
data:
In fact, the legislative history indicates that the Congress
intended that the market system `evolve through the interplay of
competitive forces as unnecessary regulatory restrictions are
removed' and that the SEC wield its regulatory power `in those
situations where competition may not be sufficient,' such as in the
creation of a `consolidated transactional reporting system.'
Id. at 535 (quoting H.R. Rep. No. 94-229 at 92 (1975), as reprinted in
1975 U.S.C.C.A.N. 323). The court agreed with the Commission's
conclusion that ``Congress intended that `competitive forces should
dictate the services and practices that constitute the U.S. national
market system for trading equity securities.' '' \15\
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\15\ NetCoalition, 615 F.3d at 535.
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As explained below in the Exchange's Statement on Burden on
Competition, the Exchange believes that there is substantial evidence
of competition in the marketplace for proprietary market data and that
the Commission can rely upon such evidence in concluding that the fees
established in this filing are the product of competition and therefore
satisfy the relevant statutory standards.
As the NetCoalition decision noted, the Commission is not required
to undertake a cost-of-service or ratemaking approach. The Exchange
believes that, even if it were possible as a matter of economic theory,
cost-based pricing for non-core market data would be so complicated
that it could not be done practically or offer any significant
benefits.\16\
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\16\ The Exchange believes that cost-based pricing would be
impractical because it would create enormous administrative burdens
for all parties, including the Commission, to cost-regulate a large
number of participants and standardize and analyze extraordinary
amounts of information, accounts, and reports. In addition, and as
described below, it is impossible to regulate market data prices in
isolation from prices charged by markets for other services that are
joint products. Cost-based rate regulation would also lead to
litigation and may distort incentives, including those to minimize
costs and to innovate, leading to further waste. Under cost-based
pricing, the Commission would be burdened with determining a fair
rate of return, and the industry could experience frequent rate
increases based on escalating expense levels. Even in industries
historically subject to utility regulation, cost-based ratemaking
has been discredited. As such, the Exchange believes that cost-based
ratemaking would be inappropriate for proprietary market data and
inconsistent with Congress's direction that the Commission use its
authority to foster the development of the national market system,
and that market forces will continue to provide appropriate pricing
discipline. See Appendix C to NYSE's comments to the Commission's
2000 Concept Release on the Regulation of Market Information Fees
and Revenues, which can be found on the Commission's Web site at
https://www.sec.gov/rules/concept/s72899/buck1.htm.
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For these reasons, the Exchange believes that the proposed fees are
reasonable, equitable, and not unfairly discriminatory.
[[Page 1563]]
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 that is not necessary or appropriate
in furtherance of the purposes of the Act. An exchange's ability to
price its proprietary market data feed products is constrained by
actual competition for the sale of proprietary market data products,
the joint product nature of exchange platforms, and the existence of
alternatives to the Exchange's proprietary data.
The Existence of Actual Competition
The market for proprietary data products is currently competitive
and inherently contestable because there is fierce competition for the
inputs necessary for the creation of proprietary data and strict
pricing discipline for the proprietary products themselves. Numerous
exchanges compete with one another for listings and order flow and
sales of market data itself, providing ample opportunities for
entrepreneurs who wish to compete in any or all of those areas,
including producing and distributing their own market data. Proprietary
data products are produced and distributed by each individual exchange,
as well as other entities, in a vigorously competitive market. Indeed,
the U.S. Department of Justice (``DOJ'') (the primary antitrust
regulator) has expressly acknowledged the aggressive actual competition
among exchanges, including for the sale of proprietary market data. In
2011, the DOJ stated that exchanges ``compete head to head to offer
real-time equity data products. These data products include the best
bid and offer of every exchange and information on each equity trade,
including the last sale.'' \17\
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\17\ Press Release, U.S. Department of Justice, Assistant
Attorney General Christine Varney Holds Conference Call Regarding
NASDAQ OMX Group Inc. and IntercontinentalExchange Inc. Abandoning
Their Bid for NYSE Euronext (May 16, 2011), available at https://www.justice.gov/iso/opa/atr/speeches/2011/at-speech-110516.html; see
also Complaint in U.S. v. Deutsche Borse AG and NYSE Euronext, Case
No. 11-cv-2280 (D.C. Dist.) ] 24 (``NYSE and Direct Edge compete
head-to-head . . . in the provision of real-time proprietary equity
data products.'').
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Moreover, competitive markets for listings, order flow, executions,
and transaction reports provide pricing discipline for the inputs of
proprietary data products and therefore constrain markets from
overpricing proprietary market data. Broker-dealers send their order
flow and transaction reports to multiple venues, rather than providing
them all to a single venue, which in turn reinforces this competitive
constraint. As a 2010 Commission Concept Release noted, the ``current
market structure can be described as dispersed and complex'' with
``trading volume . . . dispersed among many highly automated trading
centers that compete for order flow in the same stocks'' and ``trading
centers offer[ing] a wide range of services that are designed to
attract different types of market participants with varying trading
needs.'' \18\ More recently, SEC Chair Mary Jo White has noted that
competition for order flow in exchange-listed equities is ``intense''
and divided among many trading venues, including exchanges, more than
40 alternative trading systems, and more than 250 broker-dealers.\19\
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\18\ Concept Release on Equity Market Structure, Securities
Exchange Act Release No. 61358 (Jan. 14, 2010), 75 FR 3594 (Jan. 21,
2010) (File No. S7-02-10). This Concept Release included data from
the third quarter of 2009 showing that no market center traded more
than 20% of the volume of listed stocks, further evidencing the
dispersal of and competition for trading activity. Id. at 3598. Data
available on ArcaVision show that from June 30, 2013 to June 30,
2014, no exchange traded more than 12% of the volume of listed
stocks by either trade or dollar volume, further evidencing the
continued dispersal of and fierce competition for trading activity.
See https://www.arcavision.com/Arcavision/arcalogin.jsp.
\19\ Mary Jo White, Enhancing Our Equity Market Structure,
Sandler O'Neill & Partners, L.P. Global Exchange and Brokerage
Conference (June 5, 2014) (available on the Commission Web site),
citing Tuttle, Laura, 2014, ``OTC Trading: Description of Non-ATS
OTC Trading in National Market System Stocks,'' at 7-8.
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If an exchange succeeds in its competition for quotations, order
flow, and trade executions, then it earns trading revenues and
increases the value of its proprietary market data products because
they will contain greater quote and trade information. Conversely, if
an exchange is less successful in attracting quotes, order flow, and
trade executions, then its market data products may be less desirable
to customers using them in support of order routing and trading
decisions in light of the diminished content; data products offered by
competing venues may become correspondingly more attractive. Thus,
competition for quotations, order flow, and trade executions puts
significant pressure on an exchange to maintain both execution and data
fees at reasonable levels.
In addition, in the case of products that are distributed through
market data vendors, such as Bloomberg and Thompson Reuters, the
vendors themselves provide additional price discipline for proprietary
data products because they control the primary means of access to
certain end users. These vendors impose price discipline based upon
their business models. For example, vendors that assess a surcharge on
data they sell are able to refuse to offer proprietary products that
their end users do not or will not purchase in sufficient numbers.
Vendors will not elect to make available NYSE MKT Order Imbalances
unless their customers request it, and customers will not elect to pay
the proposed fees unless NYSE MKT Order Imbalances can provide value by
sufficiently increasing revenues or reducing costs in the customer's
business in a manner that will offset the fees. All of these factors
operate as constraints on pricing proprietary data products.
Joint Product Nature of Exchange Platform
Transaction execution and proprietary data products are
complementary in that market data is both an input and a byproduct of
the execution service. In fact, proprietary market data and trade
executions are a paradigmatic example of joint products with joint
costs. The decision of whether and on which platform to post an order
will depend on the attributes of the platforms where the order can be
posted, including the execution fees, data availability and quality,
and price and distribution of their data products. Without a platform
to post quotations, receive orders, and execute trades, exchange data
products would not exist.
The costs of producing market data include not only the costs of
the data distribution infrastructure, but also the costs of designing,
maintaining, and operating the exchange's platform for posting quotes,
accepting orders, and executing transactions and the cost of regulating
the exchange to ensure its fair operation and maintain investor
confidence. The total return that a trading platform earns reflects the
revenues it receives from both products and the joint costs it incurs.
Moreover, an exchange's broker-dealer customers generally view the
costs of transaction executions and market data as a unified cost of
doing business with the exchange. A broker-dealer will only choose to
direct orders to an exchange if the revenue from the transaction
exceeds its cost, including the cost of any market data that the
broker-dealer chooses to buy in support of its order routing and
trading decisions. If the costs of the transaction are not offset by
its value, then the broker-dealer may choose instead not to purchase
the product and trade away from that exchange. There is substantial
evidence of the strong correlation between order flow and market data
purchases. For example, in November 2014 more than 80% of the
transaction volume on each of NYSE MKT, and the
[[Page 1564]]
NYSE's affiliates, New York Stock Exchange LLC (``NYSE'') and NYSE
Arca, Inc. (``NYSE Arca''), was executed by market participants that
purchased one or more proprietary market data products (the 20 firms
were not the same for each market). A supra-competitive increase in the
fees for either executions or market data would create a risk of
reducing an exchange's revenues from both products.
Other market participants have noted that proprietary market data
and trade executions are joint products of a joint platform and have
common costs.\20\ The Exchange agrees with and adopts those discussions
and the arguments therein. The Exchange also notes that the economics
literature confirms that there is no way to allocate common costs
between joint products that would shed any light on competitive or
efficient pricing.\21\
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\20\ See Securities Exchange Act Release No. 72153 (May 12,
2014), 79 FR 28575, 28578 n.15 (May 16, 2014) (SR-NASDAQ-2014-045)
(``[A]ll of the exchange's costs are incurred for the unified
purposes of attracting order flow, executing and/or routing orders,
and generating and selling data about market activity. The total
return that an exchange earns reflects the revenues it receives from
the joint products and the total costs of the joint products.'').
See also Securities Exchange Act Release No. 62907 (Sept. 14, 2010),
75 FR 57314, 57317 (Sept. 20, 2010) (SR-NASDAQ-2010-110), and
Securities Exchange Act Release No. 62908 (Sept. 14, 2010), 75 FR
57321, 57324 (Sept. 20, 2010) (SR-NASDAQ-2010-111).
\21\ See generally Mark Hirschey, Fundamentals of Managerial
Economics, at 600 (2009) (``It is important to note, however, that
although it is possible to determine the separate marginal costs of
goods produced in variable proportions, it is impossible to
determine their individual average costs. This is because common
costs are expenses necessary for manufacture of a joint product.
Common costs of production--raw material and equipment costs,
management expenses, and other overhead--cannot be allocated to each
individual by-product on any economically sound basis. . . . Any
allocation of common costs is wrong and arbitrary.''). This is not
new economic theory. See, e.g., F. W. Taussig, ``A Contribution to
the Theory of Railway Rates,'' Quarterly Journal of Economics V(4)
438, 465 (July 1891) (``Yet, surely, the division is purely
arbitrary. These items of cost, in fact, are jointly incurred for
both sorts of traffic; and I cannot share the hope entertained by
the statistician of the Commission, Professor Henry C. Adams, that
we shall ever reach a mode of apportionment that will lead to
trustworthy results.'').
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Analyzing the cost of market data product production and
distribution in isolation from the cost of all of the inputs supporting
the creation of market data and market data products will inevitably
underestimate the cost of the data and data products because it is
impossible to obtain the data inputs to create market data products
without a fast, technologically robust, and well-regulated execution
system, and system and regulatory costs affect the price of both
obtaining the market data itself and creating and distributing market
data products. It would be equally misleading, however, to attribute
all of an exchange's costs to the market data portion of an exchange's
joint products. Rather, all of an exchange's costs are incurred for the
unified purposes of attracting order flow, executing and/or routing
orders, and generating and selling data about market activity. The
total return that an exchange earns reflects the revenues it receives
from the joint products and the total costs of the joint products.
As noted above, the level of competition and contestability in the
market is evident in the numerous alternative venues that compete for
order flow, including 12 equities self-regulatory organization
(``SRO'') markets, as well as various forms of ATSs, including dark
pools and electronic communication networks (``ECNs''), and
internalizing broker-dealers. SRO markets compete to attract order flow
and produce transaction reports via trade executions, and two FINRA-
regulated Trade Reporting Facilities compete to attract transaction
reports from the non-SRO venues.\22\
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\22\ FINRA's Alternative Display Facility also receives over-
the-counter trade reports that it sends to CTA.
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Competition among trading platforms can be expected to constrain
the aggregate return that each platform earns from the sale of its
joint products, but different trading platforms may choose from a range
of possible, and equally reasonable, pricing strategies as the means of
recovering total costs. For example, some platforms may choose to pay
rebates to attract orders, charge relatively low prices for market data
products (or provide market data products free of charge), and charge
relatively high prices for accessing posted liquidity. Other platforms
may choose a strategy of paying lower rebates (or no rebates) to
attract orders, setting relatively high prices for market data
products, and setting relatively low prices for accessing posted
liquidity. For example, BATS and Direct Edge, which previously operated
as ATSs and obtained exchange status in 2008 and 2010, respectively,
have provided certain market data at no charge on their Web sites in
order to attract more order flow, and use revenue rebates from
resulting additional executions to maintain low execution charges for
their users.\23\ Similarly, LavaFlow ECN provides market data to its
subscribers at no charge.\24\ In this environment, there is no economic
basis for regulating maximum prices for one of the joint products in an
industry in which suppliers face competitive constraints with regard to
the joint offering.
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\23\ This is simply a securities market-specific example of the
well-established principle that in certain circumstances more sales
at lower margins can be more profitable than fewer sales at higher
margins; this example is additional evidence that market data is an
inherent part of a market's joint platform.
\24\ See ``LavaFlow--ADF Migration,'' available at https://www.lavatrading.com/news/pdf/LavaFlow_ADF_Migration.pdf.
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Existence of Alternatives
The large number of SROs, ATSs, and internalizing broker-dealers
that currently produce proprietary data or are currently capable of
producing it provides further pricing discipline for proprietary data
products. Each SRO, ATS, and broker-dealer is currently permitted to
produce and sell proprietary data products, and many currently do or
have announced plans to do so, including but not limited to the
Exchange, NYSE, NYSE Arca, NASDAQ OMX, BATS, and Direct Edge.
The fact that proprietary data from ATSs, internalizing broker-
dealers, and vendors can bypass SROs is significant in two respects.
First, non-SROs can compete directly with SROs for the production and
sale of proprietary data products. By way of example, BATS and NYSE
Arca both published proprietary data on the Internet before registering
as exchanges. Second, because a single order or transaction report can
appear in an SRO proprietary product, a non-SRO proprietary product, or
both, the amount of data available via proprietary products is greater
in size than the actual number of orders and transaction reports that
exist in the marketplace. With respect to NYSE MKT Order Imbalances,
competitors offer similar data.\25\ Because market data users can find
suitable substitutes for most proprietary market data products, a
market that overprices its market data products stands a high risk that
users may substitute another source of market data information for its
own.
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\25\ See supra note 14.
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Those competitive pressures imposed by available alternatives are
evident in the Exchange's proposed pricing, and indeed in the fact that
the changes here have the effect of lowering the price for NYSE MKT
Order Imbalances.
In addition to the competition and price discipline described
above, the market for proprietary data products is also highly
contestable because market entry is rapid and inexpensive. The history
of electronic trading is replete with examples of entrants that swiftly
grew into some of the largest electronic trading platforms and
proprietary data producers: Archipelago, Bloomberg
[[Page 1565]]
Tradebook, Island, RediBook, Attain, TrackECN, BATS Trading and Direct
Edge. As noted above, BATS launched as an ATS in 2006 and became an
exchange in 2008, while Direct Edge began operations in 2007 and
obtained exchange status in 2010. As noted above, LavaFlow ECN provides
market data to its subscribers at no charge.\26\
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\26\ See supra note 24.
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In setting the proposed fees, the Exchange considered the
competitiveness of the market for proprietary data and all of the
implications of that competition. The Exchange believes that it has
considered all relevant factors and has not considered irrelevant
factors in order to establish fair, reasonable, and not unreasonably
discriminatory fees and an equitable allocation of fees among all
users. The existence of numerous alternatives to the Exchange's
products, including proprietary data from other sources, ensures that
the Exchange cannot set unreasonable fees, or fees that are
unreasonably discriminatory, when vendors and subscribers can elect
these alternatives or choose not to purchase a specific proprietary
data product if the attendant fees are not justified by the returns
that any particular vendor or data recipient would achieve through the
purchase.
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 with respect to 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)(ii) of the Act\27\ and paragraph (f)(2) of Rule 19b-4
thereunder.\28\ 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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\27\ 15 U.S.C. 78s(b)(3)(A)(ii).
\28\ 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:
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-NYSEMKT-2014-114 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-NYSEMKT-2014-114. 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 NYSE MKT. 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-NYSEMKT-2014-114 and should
be submitted on or before February 2, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\29\
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\29\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-00214 Filed 1-9-15; 8:45 am]
BILLING CODE 8011-01-P
