Self-Regulatory Organizations; ISE Gemini, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Schedule of Fees, 14419-14421 [2015-06263]
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Federal Register / Vol. 80, No. 53 / Thursday, March 19, 2015 / Notices
Commission, Office of FOIA Services,
100 F Street NE., Washington, DC
20549–2736.
Rmajette on DSK2VPTVN1PROD with NOTICES
Extension: Rules 17Ad–6 and 17Ad–7.
SEC File No. 270–151, OMB Control No.
3235–0291.
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.) the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget
(‘‘OMB’’) a request for approval of
extension of the existing collection of
information provided for in the
following rules: Rule 17Ad–6 (17 CFR
240.17Ad–6) and Rule 17Ad–7 (17 CFR
240.17Ad–7) under the Securities
Exchange Act of 1934 (15 U.S.C. 78a et
seq.) (‘‘Exchange Act’’).
Rule 17Ad–6 under the Exchange Act
requires every registered transfer agent
to make and keep current records about
a variety of information, such as: (1)
Specific operational data regarding the
time taken to perform transfer agent
activities (to ensure compliance with
the minimum performance standards in
Rule 17Ad–2 (17 CFR 240.17Ad–2)); (2)
written inquiries and requests by
shareholders and broker-dealers and
response time thereto; (3) resolutions,
contracts, or other supporting
documents concerning the appointment
or termination of the transfer agent; (4)
stop orders or notices of adverse claims
to the securities; and (5) all canceled
registered securities certificates.
Rule 17Ad–7 under the Exchange Act
requires each registered transfer agent to
retain the records specified in Rule
17Ad–6 in an easily accessible place for
a period of six months to six years,
depending on the type of record or
document. Rule 17Ad–7 also specifies
the manner in which records may be
maintained using electronic, microfilm,
and microfiche storage methods.
These recordkeeping requirements are
designed to ensure that all registered
transfer agents are maintaining the
records necessary for transfer agents to
monitor and keep control over their own
performance and for the Commission to
adequately examine registered transfer
agents on an historical basis for
compliance with applicable rules.
The Commission estimates that
approximately 429 registered transfer
agents will spend a total of 214,500
hours per year complying with Rules
17Ad–6 and 17Ad–7 (500 hours per year
per transfer agent).
The retention period under Rule
17Ad–7 for the recordkeeping
requirements under Rule 17Ad–6 is six
months to six years, depending on the
particular record or document. The
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recordkeeping and retention
requirements under Rules 17Ad–6 and
17Ad–7 are mandatory to assist the
Commission and other regulatory
agencies with monitoring transfer agents
and ensuring compliance with the rules.
These rules do not involve the
collection of confidential information.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
under the PRA unless it displays a
currently valid OMB control number.
The public may view background
documentation for this information
collection at the following Web site:
www.reginfo.gov. Comments should be
directed to: (i) Desk Officer for the
Securities and Exchange Commission,
Office of Information and Regulatory
Affairs, Office of Management and
Budget, Room 10102, New Executive
Office Building, Washington, DC 20503,
or by sending an email to: Shagufta_
Ahmed@omb.eop.gov; and (ii) Pamela
Dyson, Director/Chief Information
Officer, Securities and Exchange
Commission, c/o Remi Pavlik-Simon,
100 F Street NE., Washington, DC
20549, or by sending an email to: PRA_
Mailbox@sec.gov. Comments must be
submitted to OMB within 30 days of
this notice.
Dated: March 13, 2015.
Brent J. Fields,
Secretary.
[FR Doc. 2015–06316 Filed 3–18–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–74505; File No. SR–
ISEGemini–2015–06]
Self-Regulatory Organizations; ISE
Gemini, LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend the Schedule
of Fees
March 13, 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 March 2,
2015, ISE Gemini, LLC (the ‘‘Exchange’’
or ‘‘ISE Gemini’’) 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 self-regulatory
organization. The Commission is
publishing this notice to solicit
1 15
2 17
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
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14419
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
ISE Gemini proposes to amend the
Schedule of Fees as described in more
detail below. The text of the proposed
rule change is available on the
Exchange’s Internet Web site at 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
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
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 Exchange proposes to amend the
Schedule of Fees to increase Priority
Customer 3 rebates in Penny Symbols 4
and SPY as well as related fees for nonPriority Customer orders trading against
Priority Customer orders in these
symbols.
Currently, Priority Customer orders
that add liquidity on ISE Gemini are
provided a maker rebate in Penny
Symbols and SPY of $0.25 per contract
for Tier 1,5 $0.40 per contract for Tier
2, $0.46 per contract for Tier 3, $0.48
per contract for Tier 4, and $0.50 per
contract for Tier 5. In order to
incentivize members to bring their
Priority Customer orders to ISE Gemini,
the Exchange now proposes to provide
higher maker rebates to members that
achieve Tier 3 or higher. In particular,
the Exchange proposes to increase the
3 A ‘‘Priority Customer’’ is a person or entity that
is not a broker/dealer in securities, and does not
place more than 390 orders in listed options per day
on average during a calendar month for its own
beneficial account(s), as defined in Rule
100(a)(37A).
4 ‘‘Penny Symbols’’ are options overlying all
symbols listed on ISE Gemini that are in the Penny
Pilot Program.
5 This rebate is $0.32 per contract for members
that execute a Priority Customer Maker ADV of
5,000 to 19,999 contracts in a given month.
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Federal Register / Vol. 80, No. 53 / Thursday, March 19, 2015 / Notices
Priority Customer rebate in Penny
Symbols and SPY to $0.48 per contract
for Tier 3, $0.50 per contract for Tier 4,
and $0.52 per contract for Tier 5.
Market Maker,6 Non-ISE Gemini
Market Maker,7 Firm Proprietary 8/
Broker-Dealer,9 and Professional
Customer 10 (i.e. non-Priority Customer)
orders currently pay a taker fee of $0.49
per contract, subject to a discount to
$0.48 per contract for Market Makers
that achieve the highest tier. In
connection with the increased Priority
Customer rebates described above, the
Exchange further proposes to charge
non-Priority Customer orders a taker fee
of $0.50 per contract when trading
against a Priority Customer order.11
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2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the provisions of Section 6 of the Act,12
in general, and Section 6(b)(4) of the
Act,13 in particular, in that it is designed
to provide for the equitable allocation of
reasonable dues, fees, and other charges
among its members and other persons
using its facilities.
The Exchange believes that it is
reasonable and equitable to increase the
rebates offered to Priority Customer
orders in Penny Symbols and SPY, as
the proposed change is designed to
attract additional Priority Customer
volume to the Exchange. The Exchange
already provides enhanced rebates for
Priority Customer orders, and believes
that further increasing the rebates will
incentivize members to send additional
Priority Customer order flow to ISE
Gemini, creating additional liquidity to
the benefit of all members that trade on
the Exchange. The Exchange further
believes that it is reasonable and
equitable to increase the fee charged to
non-Priority Customers that trade
against a Priority Customer order as this
change is designed to offset the
6 The term Market Maker refers to ‘‘Competitive
Market Makers’’ and ‘‘Primary Market Makers’’
collectively. See Rule 100(a)(25).
7 A ‘‘Non-ISE Gemini Market Maker’’ is a market
maker as defined in Section 3(a)(38) of the
Securities Exchange Act of 1934, as amended,
registered in the same options class on another
options exchange.
8 A ‘‘Firm Proprietary’’ order is an order
submitted by a member for its own proprietary
account.
9 A ‘‘Broker-Dealer’’ order is an order submitted
by a member for a broker-dealer account that is not
its own proprietary account.
10 A ‘‘Professional Customer’’ is a person or entity
that is not a broker/dealer and is not a Priority
Customer.
11 The Exchange notes that there will be no Tier
5 Market Maker discount when trading against a
Priority Customer.
12 15 U.S.C. 78f.
13 15 U.S.C. 78f(b)(4).
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enhanced rebates offered to incentivize
the other side of the trade. As explained
above, the Exchange believes that all
members will benefit from the
additional liquidity created by the
higher Priority Customer rebates.
Furthermore, the proposed taker fee for
non-Priority Customer orders trading
against a Priority Customer is within the
range of fees charged by other options
exchanges, including the BOX Options
Exchange (‘‘BOX’’), which charges as
much as $0.59 per contract for noncustomer orders in penny pilot symbols
that trade against a public customer.14
In addition, while the Exchange is
increasing Priority Customer rebates as
well as corresponding fees for nonPriority Customers trading against
Priority Customer orders, the Exchange
does not believe that these proposed
changes are unfairly discriminatory. As
has historically been the case, Priority
Customer orders remain entitled to more
favorable fees and rebates than other
market participants in order to
encourage this order flow. A Priority
Customer is by definition not a broker
or dealer in securities, and does not
place more than 390 orders in listed
options per day on average during a
calendar month for its own beneficial
account(s). This limitation does not
apply to participants whose behavior is
substantially similar to that of market
professionals, including Professional
Customers, who will generally submit a
higher number of orders (many of which
do not result in executions) than
Priority Customers.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
In accordance with Section 6(b)(8) of
the Act,15 the Exchange does not believe
that the proposed rule change will
impose any burden on intermarket or
intramarket competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
proposed changes to fees and rebates in
Penny Symbols and SPY are designed to
attract additional order flow to the
Exchange. The Exchange believes that
the proposed fees and rebates are
competitive with fees and rebates
offered to orders executed on other
options exchanges. The Exchange
operates in a highly competitive market
in which market participants can
readily direct their order flow to
competing venues. In such an
environment, the Exchange must
continually review, and consider
adjusting, its fees and rebates to remain
14 See BOX Fee Schedule, Section 1, Exchange
Fees, A. Non-Auction Transactions.
15 15 U.S.C. 78f(b)(8).
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competitive with other exchanges. For
the reasons described above, the
Exchange believes that the proposed fee
changes reflect this competitive
environment.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
members or other interested parties.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act,16 and
subparagraph (f)(2) of Rule 19b–4
thereunder,17 because it establishes a
due, fee, or other charge imposed by ISE
Gemini.
At any time within 60 days of the
filing of such proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. 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–
ISEGemini–2015–06 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–ISEGemini-2015–06. This
file number should be included on the
16 15
17 17
E:\FR\FM\19MRN1.SGM
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
19MRN1
Federal Register / Vol. 80, No. 53 / Thursday, March 19, 2015 / Notices
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–
ISEGemini–2015–06, and should be
submitted on or before April 9, 2015.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Brent J. Fields,
Secretary.
[FR Doc. 2015–06263 Filed 3–18–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–74507; File Nos. SR–NYSE–
2011–55; SR–NYSEAmex–2011–84]
Self-Regulatory Organizations; New
York Stock Exchange LLC; NYSE MKT
LLC; Order Granting an Extension to
Limited Exemptions From Rule 612(c)
of Regulation NMS in Connection With
the Exchanges’ Retail Liquidity
Programs Until September 30, 2015
Rmajette on DSK2VPTVN1PROD with NOTICES
March 13, 2015.
On July 3, 2012, the Securities and
Exchange Commission (‘‘Commission’’)
issued an order pursuant to its authority
under Rule 612(c) of Regulation NMS
(‘‘Sub-Penny Rule’’) 1 that granted the
New York Stock Exchange LLC
18 17
1 17
CFR 200.30–3(a)(12).
CFR 242.612(c).
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15:18 Mar 18, 2015
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(‘‘NYSE’’) and NYSE MKT LLC 2
(‘‘NYSE MKT’’ and, together with
NYSE, the ‘‘Exchanges’’) limited
exemptions from the Sub-Penny Rule in
connection with the operation of the
Exchanges’ respective Retail Liquidity
Programs (the ‘‘Programs’’).3 The
limited exemptions were granted
concurrently with the Commission’s
approval of the Exchanges’ proposals to
adopt their respective Programs for oneyear pilot terms.4 The exemptions were
granted coterminous with the
effectiveness of the pilot Programs; both
the pilot Programs and exemptions are
scheduled to expire on March 31, 2015.5
The Exchanges now seek to extend
the exemptions until September 30,
2015.6 The Exchanges’ request was
made in conjunction with immediately
effective filings that extend the
operation of the Programs through the
same date.7 In their request to extend
the exemptions, the Exchanges note that
the participation in the Programs has
increased more recently. Accordingly,
the Exchanges have asked for additional
time to allow themselves and the
Commission to analyze more robust data
concerning the Programs, which the
Exchanges committed to provide to the
2 At the time it filed the original proposal to adopt
the Retail Liquidity Program, NYSE MKT went by
the name NYSE Amex LLC. On May 14, 2012, the
Exchange filed a proposed rule change,
immediately effective upon filing, to change its
name from NYSE Amex LLC to NYSE MKT LLC.
See Securities Exchange Act Release No. 67037
(May 21, 2012), 77 FR 31415 (May 25, 2012) (SR–
NYSEAmex–2012–32).
3 See Securities Exchange Act Release No. 67347
(July 3, 2012), 77 FR 40673 (July 10, 2012) (SR–
NYSE–2011–55; SR–NYSEAmex–2011–84)
(‘‘Order’’).
4 See id.
5 The pilot term of the Programs was originally
scheduled to end on July 31, 2013, but the
Exchanges initially extended the term for an
additional year, through July 31, 2014, see
Securities Exchange Act Release Nos. 70096
(August 2, 2013), 78 FR 48520 (August 8, 2013)
(SR–NYSE–2013–48), and 70100 (August 2, 2013),
78 FR 48535 (August 8, 2013) (SR–NYSEMKT–
2013–60), and then subsequently extended the term
again through March 31, 2015, see Securities
Exchange Act Release Nos. 72629 (July 16, 2014),
79 FR 42564 (July 22, 2014) (SR–NYSE–2014–35),
and 72625 (July 16, 2014), 79 FR 42566 (July 22,
2014) (SR–NYSEMKT–2014–60). Each time the
pilot term of the Programs was extended, the
Commission granted the Exchanges’ requests to also
extend the Sub-Penny Exemption through July 31,
2014, see Securities Exchange Act Release No.
70085 (July 31, 2013), 78 FR 47807 (August 6,
2013), and March 31, 2015, see Securities Exchange
Act Release No. 72732 (July 31, 2014), 79 FR 45851
(August 6, 2014), respectively.
6 See Letter from Martha Redding, Senior
Counsel, NYSE, to Brent J. Fields, Secretary,
Securities and Exchange Commission, dated
February 27, 2015.
7 See Securities Exchange Act Release Nos. 34–
74454 (March 6, 2015), 80 FR 13054 (March 12,
2015) (SR–NYSE–2015–10), and 34–74455 (March
6, 2015), 80 FR 13047 (March 12, 2015) (SR–
NYSEMKT–2015–14).
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14421
Commission.8 For this reason and the
reasons stated in the Order originally
granting the limited exemptions, the
Commission finds that extending the
exemptions, pursuant to its authority
under Rule 612(c) of Regulation NMS, is
appropriate in the public interest and
consistent with the protection of
investors.
Therefore, it is hereby ordered that,
pursuant to Rule 612(c) of Regulation
NMS, each Exchange is granted a
limited exemption from Rule 612 of
Regulation NMS that allows it to accept
and rank orders priced equal to or
greater than $1.00 per share in
increments of $0.001, in connection
with the operation of its Retail Liquidity
Program, until September 30, 2015.
The limited and temporary
exemptions extended by this Order are
subject to modification or revocation if
at any time the Commission determines
that such action is necessary or
appropriate in furtherance of the
purposes of the Securities Exchange Act
of 1934. Responsibility for compliance
with any applicable provisions of the
Federal securities laws must rest with
the persons relying on the exemptions
that are the subject of this Order.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Brent J. Fields,
Secretary.
[FR Doc. 2015–06265 Filed 3–18–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–74496; File No. SR–MIAX–
2015–03]
Self-Regulatory Organizations; Miami
International Securities Exchange LLC;
Order Granting Approval to Proposed
Rule Change, as Modified by
Amendment No. 1 Thereto, To Adopt a
‘‘Risk Protection Monitor’’
Functionality Under Proposed MIAX
Rule 519A and Amend the ‘‘Aggregate
Risk Monitor’’ Functionality Under
MIAX Rule 612
March 13, 2015.
I. Introduction
On January 8, 2015, Miami
International Securities Exchange LLC
(‘‘MIAX’’ or ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’), pursuant to section
19(b)(1) of the Securities Exchange Act
8 See
9 17
Order, supra note 3, 77 FR at 40681.
CFR 200.30–3(a)(83).
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]]>Agencies
[Federal Register Volume 80, Number 53 (Thursday, March 19, 2015)]
[Notices]
[Pages 14419-14421]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-06263]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-74505; File No. SR-ISEGemini-2015-06]
Self-Regulatory Organizations; ISE Gemini, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend the
Schedule of Fees
March 13, 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 March 2, 2015, ISE Gemini, LLC (the ``Exchange'' or ``ISE
Gemini'') 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 self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
ISE Gemini proposes to amend the Schedule of Fees as described in
more detail below. The text of the proposed rule change is available on
the Exchange's Internet Web site at 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 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 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 Exchange proposes to amend the Schedule of Fees to increase
Priority Customer \3\ rebates in Penny Symbols \4\ and SPY as well as
related fees for non-Priority Customer orders trading against Priority
Customer orders in these symbols.
---------------------------------------------------------------------------
\3\ A ``Priority Customer'' is a person or entity that is not a
broker/dealer in securities, and does not place more than 390 orders
in listed options per day on average during a calendar month for its
own beneficial account(s), as defined in Rule 100(a)(37A).
\4\ ``Penny Symbols'' are options overlying all symbols listed
on ISE Gemini that are in the Penny Pilot Program.
---------------------------------------------------------------------------
Currently, Priority Customer orders that add liquidity on ISE
Gemini are provided a maker rebate in Penny Symbols and SPY of $0.25
per contract for Tier 1,\5\ $0.40 per contract for Tier 2, $0.46 per
contract for Tier 3, $0.48 per contract for Tier 4, and $0.50 per
contract for Tier 5. In order to incentivize members to bring their
Priority Customer orders to ISE Gemini, the Exchange now proposes to
provide higher maker rebates to members that achieve Tier 3 or higher.
In particular, the Exchange proposes to increase the
[[Page 14420]]
Priority Customer rebate in Penny Symbols and SPY to $0.48 per contract
for Tier 3, $0.50 per contract for Tier 4, and $0.52 per contract for
Tier 5.
---------------------------------------------------------------------------
\5\ This rebate is $0.32 per contract for members that execute a
Priority Customer Maker ADV of 5,000 to 19,999 contracts in a given
month.
---------------------------------------------------------------------------
Market Maker,\6\ Non-ISE Gemini Market Maker,\7\ Firm Proprietary
\8\/Broker-Dealer,\9\ and Professional Customer \10\ (i.e. non-Priority
Customer) orders currently pay a taker fee of $0.49 per contract,
subject to a discount to $0.48 per contract for Market Makers that
achieve the highest tier. In connection with the increased Priority
Customer rebates described above, the Exchange further proposes to
charge non-Priority Customer orders a taker fee of $0.50 per contract
when trading against a Priority Customer order.\11\
---------------------------------------------------------------------------
\6\ The term Market Maker refers to ``Competitive Market
Makers'' and ``Primary Market Makers'' collectively. See Rule
100(a)(25).
\7\ A ``Non-ISE Gemini Market Maker'' is a market maker as
defined in Section 3(a)(38) of the Securities Exchange Act of 1934,
as amended, registered in the same options class on another options
exchange.
\8\ A ``Firm Proprietary'' order is an order submitted by a
member for its own proprietary account.
\9\ A ``Broker-Dealer'' order is an order submitted by a member
for a broker-dealer account that is not its own proprietary account.
\10\ A ``Professional Customer'' is a person or entity that is
not a broker/dealer and is not a Priority Customer.
\11\ The Exchange notes that there will be no Tier 5 Market
Maker discount when trading against a Priority Customer.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\12\ in general, and
Section 6(b)(4) of the Act,\13\ in particular, in that it is designed
to provide for the equitable allocation of reasonable dues, fees, and
other charges among its members and other persons using its facilities.
---------------------------------------------------------------------------
\12\ 15 U.S.C. 78f.
\13\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
The Exchange believes that it is reasonable and equitable to
increase the rebates offered to Priority Customer orders in Penny
Symbols and SPY, as the proposed change is designed to attract
additional Priority Customer volume to the Exchange. The Exchange
already provides enhanced rebates for Priority Customer orders, and
believes that further increasing the rebates will incentivize members
to send additional Priority Customer order flow to ISE Gemini, creating
additional liquidity to the benefit of all members that trade on the
Exchange. The Exchange further believes that it is reasonable and
equitable to increase the fee charged to non-Priority Customers that
trade against a Priority Customer order as this change is designed to
offset the enhanced rebates offered to incentivize the other side of
the trade. As explained above, the Exchange believes that all members
will benefit from the additional liquidity created by the higher
Priority Customer rebates. Furthermore, the proposed taker fee for non-
Priority Customer orders trading against a Priority Customer is within
the range of fees charged by other options exchanges, including the BOX
Options Exchange (``BOX''), which charges as much as $0.59 per contract
for non-customer orders in penny pilot symbols that trade against a
public customer.\14\
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\14\ See BOX Fee Schedule, Section 1, Exchange Fees, A. Non-
Auction Transactions.
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In addition, while the Exchange is increasing Priority Customer
rebates as well as corresponding fees for non-Priority Customers
trading against Priority Customer orders, the Exchange does not believe
that these proposed changes are unfairly discriminatory. As has
historically been the case, Priority Customer orders remain entitled to
more favorable fees and rebates than other market participants in order
to encourage this order flow. A Priority Customer is by definition not
a broker or dealer in securities, and does not place more than 390
orders in listed options per day on average during a calendar month for
its own beneficial account(s). This limitation does not apply to
participants whose behavior is substantially similar to that of market
professionals, including Professional Customers, who will generally
submit a higher number of orders (many of which do not result in
executions) than Priority Customers.
B. Self-Regulatory Organization's Statement on Burden on Competition
In accordance with Section 6(b)(8) of the Act,\15\ the Exchange
does not believe that the proposed rule change will impose any burden
on intermarket or intramarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The proposed
changes to fees and rebates in Penny Symbols and SPY are designed to
attract additional order flow to the Exchange. The Exchange believes
that the proposed fees and rebates are competitive with fees and
rebates offered to orders executed on other options exchanges. The
Exchange operates in a highly competitive market in which market
participants can readily direct their order flow to competing venues.
In such an environment, the Exchange must continually review, and
consider adjusting, its fees and rebates to remain competitive with
other exchanges. For the reasons described above, the Exchange believes
that the proposed fee changes reflect this competitive environment.
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\15\ 15 U.S.C. 78f(b)(8).
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act,\16\ and subparagraph (f)(2) of Rule 19b-4
thereunder,\17\ because it establishes a due, fee, or other charge
imposed by ISE Gemini.
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\16\ 15 U.S.C. 78s(b)(3)(A)(ii).
\17\ 17 CFR 240.19b-4(f)(2).
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At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. 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-ISEGemini-2015-06 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-ISEGemini-2015-06. This
file number should be included on the
[[Page 14421]]
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-ISEGemini-2015-06, and should be submitted on or before
April 9, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-06263 Filed 3-18-15; 8:45 am]
BILLING CODE 8011-01-P
