Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fee Schedule on the BOX Market LLC Options Facility, 7886-7888 [2015-02894]
Download as PDF
<![CDATA[
Rmajette on DSK2VPTVN1PROD with NOTICES
7886
Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices
the public as employing the Manager of
Managers Structure. The prospectus will
prominently disclose that the Adviser
has the ultimate responsibility, subject
to oversight by the Board, to oversee the
Subadvisers and recommend their
hiring, termination, and replacement.
3. Subadvised Funds will inform
shareholders of the hiring of a new
Subadviser within 90 days after the
hiring of the new Subadviser pursuant
to the Modified Notice and Access
Procedures.
4. The Adviser will not enter into a
Subadvisory Agreement with any
Affiliated Subadviser unless such
agreement, including the compensation
to be paid thereunder, has been
approved by the shareholders of the
applicable Subadvised Fund.
5. At all times, at least a majority of
the Board will be Independent
Directors, and the selection and
nomination of new or additional
Independent Directors will be placed
within the discretion of the thenexisting Independent Directors.
6. Independent Legal Counsel, as
defined in rule 0–1(a)(6) under the Act,
will be engaged to represent the
Independent Directors. The selection of
such counsel will be within the
discretion of the then-existing
Independent Directors.
7. Whenever a subadviser change is
proposed for a Subadvised Fund with
an Affiliated Subadviser, the Board,
including a majority of the Independent
Directors, will make a separate finding,
reflected in the Board minutes, that the
change is in the best interests of the
Subadvised Fund and its shareholders,
and does not involve a conflict of
interest from which the Adviser or the
Affiliated Subadviser derives an
inappropriate advantage.
8. Whenever a subadviser is hired or
terminated, the Adviser will provide the
Board with information showing the
expected impact on the profitability of
the Adviser.
9. The Adviser will provide the
Board, no less frequently than quarterly,
with information about the profitability
of the Adviser on a per Subadvised
Fund basis. The information will reflect
the impact on profitability of the hiring
or termination of any subadviser during
the applicable quarter.
10. The Adviser will provide general
management services to each
Subadvised Fund, including overall
supervisory responsibility for the
general management and investment of
the Subadvised Fund’s assets and,
subject to review and approval of the
Board, will: (i) Set the Subadvised
Fund’s overall investment strategies; (ii)
evaluate, select, and recommend
VerDate Sep<11>2014
13:54 Feb 11, 2015
Jkt 235001
Subadvisers to manage all or a portion
of the Subadvised Fund’s assets; (iii)
allocate and, when appropriate,
reallocate the Subadvised Fund’s assets
among Subadvisers; (iv) monitor and
evaluate the Subadvisers’ performance;
and (v) implement procedures
reasonably designed to ensure that
Subadvisers comply with the
Subadvised Fund’s investment
objective, policies and restrictions.
11. No Director or officer of a
Subadvised Fund or director, manager
or officer of the Adviser will own
directly or indirectly (other than
through a pooled investment vehicle
that is not controlled by such person)
any interest in a Subadviser except for
(i) ownership of interests in the Adviser
or any entity that controls, is controlled
by or is under common control with the
Adviser; or (ii) ownership of less than
1% of the outstanding securities of any
class of equity or debt of any publicly
traded company that is either a
Subadviser or an entity that controls, is
controlled by or is under common
control with a Subadviser.
12. Each Subadvised Fund will
disclose in its registration statement the
Aggregate Fee Disclosure.
13. In the event the Commission
adopts a rule under the Act providing
substantially similar relief to that in the
order requested in the application, the
requested order will expire on the
effective date of that rule.
14. Any new Subadvisory Agreement
or any changes to an Investment
Advisory Agreement or to a Subadvisory
Agreement that directly or indirectly
results in an increase in the aggregate
advisory rate charged to a Subadvised
Fund will be required to be approved by
the shareholders of the Subadvised
Fund.
For the Commission, by the Division of
Investment Management, under delegated
authority.
Brent J. Fields,
Secretary.
[FR Doc. 2015–02916 Filed 2–11–15; 8:45 am]
BILLING CODE 8011–01–P
PO 00000
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–74221; File No. SR–BOX–
2015–11]
Self-Regulatory Organizations; BOX
Options Exchange LLC; Notice of
Filing and Immediate Effectiveness of
a Proposed Rule Change To Amend
the Fee Schedule on the BOX Market
LLC Options Facility
February 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 January
30, 2015, BOX Options Exchange LLC
(the ‘‘Exchange’’) 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 filed the proposed rule change
pursuant to Section 19(b)(3)(A)(ii) of the
Act,3 and Rule 19b–4(f)(2) thereunder,4
which renders the proposal 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 is filing with the
Securities and Exchange Commission
(‘‘Commission’’) a proposed rule change
to amend the Fee Schedule on the BOX
Market LLC (‘‘BOX’’) options facility.
The text of the proposed rule change is
available from the principal office of the
Exchange, at the Commission’s Public
Reference Room and also on the
Exchange’s Internet Web site at https://
boxexchange.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
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 aspects of such
statements.
1 15
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).
2 17
Frm 00060
Fmt 4703
Sfmt 4703
E:\FR\FM\12FEN1.SGM
12FEN1
7887
Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend the
Fee Schedule for trading on BOX.
Specifically, the Exchange proposes to
amend the BOX Volume Rebate (‘‘BVR’’)
in Section I.B.2 of the Fee Schedule
(Auction Transactions).
Under the current BVR, the Exchange
offers a tiered per contract rebate for all
PIP Orders and COPIP Orders of 250
contracts and under. PIP and COPIP
executions of 250 contracts and under
are awarded a per contract rebate
according to the Participant’s Monthly
Average Daily Volume (‘‘ADV’’) in PIP
and COPIP transactions. Each
Participant’s monthly ADV is based on
PIP and COPIP quantity submitted and
calculated at the end of each month.5
The current per contract rebate for
Participants in PIP and COPIP
Transactions under the BVR is:
Per contract rebate
(all account types)
Monthly ADV in PIP and COPIP transactions
PIP
100,001 contracts and greater ....................................................................................................................
40,001 contracts to 100,000 contracts ........................................................................................................
20,001 contracts to 40,000 contracts ..........................................................................................................
1 contract to 20,000 contracts .....................................................................................................................
The Exchange proposes to adjust the
BVR contract threshold and now offer
the tiered per contract rebate for all PIP
Orders and COPIP Orders of 100
contracts and under. The quantity
submitted will remain based on a
Participant’s monthly ADV as calculated
at the end of each month.
Additionally, the Exchange proposes
to lower the rebates associated with
COPIP
($0.17)
(0.14)
(0.07)
(0.00)
each volume tier. The new BVR set forth
in Section I.B.2 of the BOX Fee
Schedule will be as follows:
Per contract rebate
(all account types)
Monthly ADV in PIP and COPIP transactions
PIP
100,001 contracts and greater ....................................................................................................................
40,001 contracts to 100,000 contracts ........................................................................................................
20,001 contracts to 40,000 contracts ..........................................................................................................
1 contract to 20,000 contracts .....................................................................................................................
Rmajette on DSK2VPTVN1PROD with NOTICES
2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the Act,
in general, and Section 6(b)(4) and
6(b)(5) of the Act,6 in particular, in that
it provides for the equitable allocation
of reasonable dues, fees, and other
charges among BOX Participants and
other persons using its facilities and
does not unfairly discriminate between
customers, issuers, brokers or dealers.
The Exchange believes the proposed
amendments to the BVR in Section I.B.2
are reasonable, equitable and nondiscriminatory. The BVR was adopted to
attract Public Customer order flow to
the Exchange by offering these
Participants incentives to submit their
PIP and COPIP Orders to the Exchange.
Other Exchange [sic] employ similar
incentive programs.7 The Exchange
believes it is reasonable and appropriate
to continue to provide incentives for
5 For purposes of calculating monthly ADV, BOX
will count as a half day any day that the market
closes early for a holiday observance.
6 15 U.S.C. 78f(b)(4) and (5).
7 See Section B of the Phlx Pricing Schedule
entitled ‘‘Customer Rebate Program’’ and CBOE’s
Volume Incentive Program (VIP). CBOE’s Volume
Incentive Program (‘‘VIP’’) pays certain tiered
VerDate Sep<11>2014
13:54 Feb 11, 2015
Jkt 235001
($0.08)
(0.06)
(0.04)
(0.00)
COPIP
($0.14)
(0.11)
(0.04)
(0.00)
($0.06)
(0.04)
(0.02)
(0.00)
Public Customers, which will result in
greater liquidity and ultimately benefit
all Participants trading on the Exchange.
The Exchange believes providing a
rebate to Participants that reach a
certain volume threshold is equitable
and non-discriminatory as the rebate
will apply to all Participants uniformly.
The Exchange believes it is
reasonable, equitable and nondiscriminatory to restrict the BVR to PIP
and COPIP Orders of 100 contracts and
under. The BVR is intended to
incentivize Participants to direct
Customer order flow to the Exchange,
which is typically comprised of small
order sizes. The Exchange has found
that orders of more than 100 contracts
are typically larger institutional orders.
Further, these larger orders are
encouraged to use the Facilitation and
Solicitation Auction mechanisms.8 The
Exchange believes restricting the BVR to
PIP and COPIP Orders of 100 contracts
and under is equitable and nondiscriminatory as this will apply to all
Participants uniformly.
The Exchange believes that lowering
the rebates associated with each volume
tier is reasonable and competitive when
compared to rebate structures at other
exchanges.9 Once the volume threshold
is met, the Exchange will continue [sic]
pay the rebates on applicable PIP and
COPIP Orders. The Exchange also
believes the proposed rebates are
equitable and not unfairly
discriminatory because Participants are
eligible to receive a rebate provided they
meet both the volume and order type
requirements. The Exchange believes
that applying the rebate to PIP and
COPIP Orders will continue to provide
these Participants with an added
incentive to transact a greater number of
Public Customer Orders on the
Exchange to the benefit of all market
participants.
rebates to Trading Permit Holders for electronically
executed multiply-listed option orders which
include AIM orders. Note that these exchanges base
these rebate programs on the percentage of total
national Public Customer volume traded on their
respective exchanges, which the Exchange is not
proposing to do.
8 The Faciliation [sic] Auction and Solicitation
Auction were designed to give market participants
mechanisms for large block orders. See Securities
Exchange Act Release No. 65387 (September 23,
2011), 76 FR 60569 (September 29, 2011) (Order
Approving Proposed Rule Change of SR–BX–2011–
034).
9 See supra, note 7.
PO 00000
Frm 00061
Fmt 4703
Sfmt 4703
E:\FR\FM\12FEN1.SGM
12FEN1
7888
Federal Register / Vol. 80, No. 29 / Thursday, February 12, 2015 / Notices
Finally, the Exchange believes that it
is equitable and not unfairly
discriminatory to continue to provide a
higher rebate for PIP Orders than COPIP
Orders. The rebate is intended to
incentivize Participants to submit PIP
and COPIP Orders to the Exchange and
the Exchange believes that COPIP
Orders do not need the same level of
incentivization. The Exchange believes
the lower COPIP rebate will still provide
greater liquidity and trading
opportunities for all market
participants.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act. The
Exchange believes the proposed fee
changes are reasonably designed to
enhance competition in BOX
transactions, particularly auction
transactions.
The proposed rule change modifies
the contract threshold and tiered rebates
awarded to Participants based on their
monthly ADV in PIP and COPIP. BOX
notes that its market model and fees are
generally intended to benefit retail
customers by providing incentives for
Participants to submit their customer
order flow to BOX, and to the PIP and
COPIP in particular. The Exchange does
not believe that the proposed fee change
burdens competition and will instead
help promote competition by continuing
to providing [sic] incentives for market
participants to submit customer order
flow to BOX and thus, create a greater
opportunity for retail customers to
receive additional price improvement.
Rmajette on DSK2VPTVN1PROD with NOTICES
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Exchange Act 10
and Rule 19b–4(f)(2) thereunder,11
because it establishes or changes a due,
or fee.
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend the rule change if
10 15
11 17
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
VerDate Sep<11>2014
13:54 Feb 11, 2015
Jkt 235001
it appears to the Commission that the
action is necessary or appropriate in the
public interest, for the protection of
investors, or would otherwise further
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
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–
BOX–2015–11 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–BOX–2015–11. 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–BOX–
PO 00000
Frm 00062
Fmt 4703
Sfmt 4703
2015–11, and should be submitted on or
before March 5, 2015.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Brent J. Fields,
Secretary.
[FR Doc. 2015–02894 Filed 2–18–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–74222; File No. SR–NYSE–
2015–05]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Include
Internet Protocol Network Connections
and Fiber Cross Connects Between a
User’s Cabinet and Non-User’s
Equipment as Co-Location Services
February 6, 2015.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that on January
26, 2015, New York Stock Exchange
LLC (‘‘NYSE’’ or the ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the selfregulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend its
rules to provide that the co-location
services offered by the Exchange
include 1 Gigabit (‘‘Gb’’) and 10 Gb
Internet Protocol (‘‘IP’’) network
connections in the Exchange’s data
center and fiber cross connects (‘‘cross
connects’’) between a Users’ [sic]
cabinet and non-User’s equipment. In
addition, the proposed rule change
reflects changes to the Exchange’s Price
List related to these co-location services.
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.
12 17
CFR 200.30–3(a)(12).
U.S.C.78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
1 15
E:\FR\FM\12FEN1.SGM
12FEN1
]]>Agencies
[Federal Register Volume 80, Number 29 (Thursday, February 12, 2015)]
[Notices]
[Pages 7886-7888]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-02894]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-74221; File No. SR-BOX-2015-11]
Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend the Fee Schedule on the BOX Market LLC Options Facility
February 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 January 30, 2015, BOX Options Exchange LLC (the ``Exchange'')
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 filed the
proposed rule change pursuant to Section 19(b)(3)(A)(ii) of the Act,\3\
and Rule 19b-4(f)(2) thereunder,\4\ which renders the proposal
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 is filing with the Securities and Exchange Commission
(``Commission'') a proposed rule change to amend the Fee Schedule on
the BOX Market LLC (``BOX'') options facility. The text of the proposed
rule change is available from the principal office of the Exchange, at
the Commission's Public Reference Room and also on the Exchange's
Internet Web site at https://boxexchange.com.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the 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 aspects of such
statements.
[[Page 7887]]
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the Fee Schedule for trading on BOX.
Specifically, the Exchange proposes to amend the BOX Volume Rebate
(``BVR'') in Section I.B.2 of the Fee Schedule (Auction Transactions).
Under the current BVR, the Exchange offers a tiered per contract
rebate for all PIP Orders and COPIP Orders of 250 contracts and under.
PIP and COPIP executions of 250 contracts and under are awarded a per
contract rebate according to the Participant's Monthly Average Daily
Volume (``ADV'') in PIP and COPIP transactions. Each Participant's
monthly ADV is based on PIP and COPIP quantity submitted and calculated
at the end of each month.\5\
---------------------------------------------------------------------------
\5\ For purposes of calculating monthly ADV, BOX will count as a
half day any day that the market closes early for a holiday
observance.
---------------------------------------------------------------------------
The current per contract rebate for Participants in PIP and COPIP
Transactions under the BVR is:
------------------------------------------------------------------------
Per contract rebate (all account
Monthly ADV in PIP and COPIP types)
transactions -------------------------------------
PIP COPIP
------------------------------------------------------------------------
100,001 contracts and greater..... ($0.17) ($0.08)
40,001 contracts to 100,000 (0.14) (0.06)
contracts........................
20,001 contracts to 40,000 (0.07) (0.04)
contracts........................
1 contract to 20,000 contracts.... (0.00) (0.00)
------------------------------------------------------------------------
The Exchange proposes to adjust the BVR contract threshold and now
offer the tiered per contract rebate for all PIP Orders and COPIP
Orders of 100 contracts and under. The quantity submitted will remain
based on a Participant's monthly ADV as calculated at the end of each
month.
Additionally, the Exchange proposes to lower the rebates associated
with each volume tier. The new BVR set forth in Section I.B.2 of the
BOX Fee Schedule will be as follows:
------------------------------------------------------------------------
Per contract rebate (all account
Monthly ADV in PIP and COPIP types)
transactions -------------------------------------
PIP COPIP
------------------------------------------------------------------------
100,001 contracts and greater..... ($0.14) ($0.06)
40,001 contracts to 100,000 (0.11) (0.04)
contracts........................
20,001 contracts to 40,000 (0.04) (0.02)
contracts........................
1 contract to 20,000 contracts.... (0.00) (0.00)
------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act, in general, and Section
6(b)(4) and 6(b)(5) of the Act,\6\ in particular, in that it provides
for the equitable allocation of reasonable dues, fees, and other
charges among BOX Participants and other persons using its facilities
and does not unfairly discriminate between customers, issuers, brokers
or dealers.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------
The Exchange believes the proposed amendments to the BVR in Section
I.B.2 are reasonable, equitable and non-discriminatory. The BVR was
adopted to attract Public Customer order flow to the Exchange by
offering these Participants incentives to submit their PIP and COPIP
Orders to the Exchange. Other Exchange [sic] employ similar incentive
programs.\7\ The Exchange believes it is reasonable and appropriate to
continue to provide incentives for Public Customers, which will result
in greater liquidity and ultimately benefit all Participants trading on
the Exchange. The Exchange believes providing a rebate to Participants
that reach a certain volume threshold is equitable and non-
discriminatory as the rebate will apply to all Participants uniformly.
---------------------------------------------------------------------------
\7\ See Section B of the Phlx Pricing Schedule entitled
``Customer Rebate Program'' and CBOE's Volume Incentive Program
(VIP). CBOE's Volume Incentive Program (``VIP'') pays certain tiered
rebates to Trading Permit Holders for electronically executed
multiply-listed option orders which include AIM orders. Note that
these exchanges base these rebate programs on the percentage of
total national Public Customer volume traded on their respective
exchanges, which the Exchange is not proposing to do.
---------------------------------------------------------------------------
The Exchange believes it is reasonable, equitable and non-
discriminatory to restrict the BVR to PIP and COPIP Orders of 100
contracts and under. The BVR is intended to incentivize Participants to
direct Customer order flow to the Exchange, which is typically
comprised of small order sizes. The Exchange has found that orders of
more than 100 contracts are typically larger institutional orders.
Further, these larger orders are encouraged to use the Facilitation and
Solicitation Auction mechanisms.\8\ The Exchange believes restricting
the BVR to PIP and COPIP Orders of 100 contracts and under is equitable
and non-discriminatory as this will apply to all Participants
uniformly.
---------------------------------------------------------------------------
\8\ The Faciliation [sic] Auction and Solicitation Auction were
designed to give market participants mechanisms for large block
orders. See Securities Exchange Act Release No. 65387 (September 23,
2011), 76 FR 60569 (September 29, 2011) (Order Approving Proposed
Rule Change of SR-BX-2011-034).
---------------------------------------------------------------------------
The Exchange believes that lowering the rebates associated with
each volume tier is reasonable and competitive when compared to rebate
structures at other exchanges.\9\ Once the volume threshold is met, the
Exchange will continue [sic] pay the rebates on applicable PIP and
COPIP Orders. The Exchange also believes the proposed rebates are
equitable and not unfairly discriminatory because Participants are
eligible to receive a rebate provided they meet both the volume and
order type requirements. The Exchange believes that applying the rebate
to PIP and COPIP Orders will continue to provide these Participants
with an added incentive to transact a greater number of Public Customer
Orders on the Exchange to the benefit of all market participants.
---------------------------------------------------------------------------
\9\ See supra, note 7.
---------------------------------------------------------------------------
[[Page 7888]]
Finally, the Exchange believes that it is equitable and not
unfairly discriminatory to continue to provide a higher rebate for PIP
Orders than COPIP Orders. The rebate is intended to incentivize
Participants to submit PIP and COPIP Orders to the Exchange and the
Exchange believes that COPIP Orders do not need the same level of
incentivization. The Exchange believes the lower COPIP rebate will
still provide greater liquidity and trading opportunities for all
market participants.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange believes the
proposed fee changes are reasonably designed to enhance competition in
BOX transactions, particularly auction transactions.
The proposed rule change modifies the contract threshold and tiered
rebates awarded to Participants based on their monthly ADV in PIP and
COPIP. BOX notes that its market model and fees are generally intended
to benefit retail customers by providing incentives for Participants to
submit their customer order flow to BOX, and to the PIP and COPIP in
particular. The Exchange does not believe that the proposed fee change
burdens competition and will instead help promote competition by
continuing to providing [sic] incentives for market participants to
submit customer order flow to BOX and thus, create a greater
opportunity for retail customers to receive additional price
improvement.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Exchange Act \10\ and Rule 19b-4(f)(2)
thereunder,\11\ because it establishes or changes a due, or fee.
---------------------------------------------------------------------------
\10\ 15 U.S.C. 78s(b)(3)(A)(ii).
\11\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend the rule
change if it appears to the Commission that the action is necessary or
appropriate in the public interest, for the protection of investors, or
would otherwise further the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.
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-BOX-2015-11 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-BOX-2015-11. 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-BOX-2015-11, and should be
submitted on or before March 5, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
---------------------------------------------------------------------------
\12\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Brent J. Fields,
Secretary.
[FR Doc. 2015-02894 Filed 2-18-15; 8:45 am]
BILLING CODE 8011-01-P
