Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees Schedule, 22251-22254 [2015-09069]

Download as PDF tkelley on DSK3SPTVN1PROD with NOTICES Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices information by its employees.21 The Exchange states that the Adviser is not a broker-dealer, and is not affiliated with any broker-dealer. In addition, the Exchange states that in the event (a) the Adviser becomes affiliated with a broker-dealer or registers as a brokerdealer, or (b) any new adviser or subadviser is a registered broker-dealer or becomes affiliated with a broker-dealer, it will implement a fire wall with respect to its relevant personnel and/or such broker-dealer affiliate, as applicable, regarding access to information concerning the composition and/or changes to the portfolio and will be subject to procedures designed to prevent the use and dissemination of material nonpublic information regarding such portfolio.22 FINRA, on behalf of the Exchange, will communicate as needed regarding trading in the Shares and other exchange-traded securities with other markets and other entities that are ISG members, and FINRA, on behalf of the Exchange, may obtain trading information regarding trading in the Shares and other exchange-traded securities from such markets and other entities. In addition, the Exchange may obtain information regarding trading in the Shares and other exchange-traded securities from markets and other entities that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement.23 The Commission notes that the Fund and the Shares must comply with the requirements of Nasdaq Rule 5735 to be listed and traded on the Exchange. Nasdaq deems the Shares to be equity securities, thus rendering trading in the Shares subject to Nasdaq’s existing rules governing the trading of equity securities. In support of this proposal, the Exchange represented that: (1) The Shares will be subject to Nasdaq Rule 5735, which sets forth the initial and continued listing criteria applicable to Managed Fund Shares. (2) Trading in the Shares will be subject to the existing trading surveillances administered by both Nasdaq and FINRA on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws, and these procedures are adequate to properly monitor Exchange trading of the Shares in all trading sessions and to deter and detect violations of Exchange 21 See id. at 11508. 22 See supra note 7. 23 For a list of the current members of ISG, see www.isgportal.org. VerDate Sep<11>2014 18:07 Apr 20, 2015 Jkt 235001 rules and applicable federal securities laws. (3) The Exchange has appropriate rules to facilitate transactions in the Shares during all trading sessions. (4) Prior to the commencement of trading, the Exchange will inform its members in an Information Circular of the special characteristics and risks associated with trading the Shares. Specifically, the Information Circular will discuss the following: (a) The procedures for purchases and redemptions of Shares in Creation Units (and that Shares are not individually redeemable); (b) Nasdaq Rule 2111A, which imposes suitability obligations on Nasdaq members with respect to recommending transactions in the Shares to customers; (c) the dissemination of information regarding the Intraday Indicative Value through major index service providers such as NASDAQ OMX proprietary index data services or other major market proprietary index services; (d) the risks involved in trading the Shares during the Pre-Market and Post-Market Sessions when an updated Intraday Indicative Value will not be calculated or publicly disseminated; (e) the requirement that members deliver a prospectus to investors purchasing newly issued Shares prior to or concurrently with the confirmation of a transaction; (f) trading information; and (g) the dissemination of the Disclosed Portfolio through the Fund’s Web site. (5) For initial and/or continued listing, the Fund must be in compliance with Rule 10A–3 24 under the Act. (6) The Fund may invest up to 30% of its net assets in foreign equity securities of small cap companies traded on a U.S. exchange as ADRs, which may include companies in emerging markets. (7) The Fund may hold up to an aggregate amount of 15% of its net assets in illiquid securities or other illiquid assets (calculated at the time of investment). (8) The Fund may not invest more than 25% of the value of its total assets in securities of issuers in any one industry or group of industries. This restriction does not apply to obligations issued or guaranteed by the U.S. government, its agencies or instrumentalities, or securities of other registered investment companies. (9) Not more than 10% of the net assets of the Fund, in the aggregate, will be invested in unlisted equity securities or equity securities not listed on an exchange that is a member of the ISG or a party to a comprehensive surveillance sharing agreement with the Exchange. 24 See PO 00000 17 CFR 240.10A–3. Frm 00090 Fmt 4703 Sfmt 4703 22251 (10) A minimum of 100,000 Shares will be outstanding at the commencement of trading on the Exchange. This approval order is based on all of the Exchange’s representations, including those set forth above and in the Notice. For the foregoing reasons, the Commission finds that the proposed rule change is consistent with section 6(b)(5) of the Act 25 and the rules and regulations thereunder applicable to a national securities exchange. IV. Conclusion It is therefore ordered, pursuant to section 19(b)(2) of the Exchange Act,26 that the proposed rule change (SR– NASDAQ–2015–013) be, and it hereby is, approved. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.27 Brent J. Fields, Secretary. [FR Doc. 2015–09064 Filed 4–20–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–74733; File No. SR–C2– 2015–007] Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees Schedule April 15, 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 April 10, 2015, C2 Options Exchange, Incorporated (the ‘‘Exchange’’ or ‘‘C2’’) 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 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 its Fees Schedule. The text of the proposed rule change is available on the 25 15 U.S.C. 78f(b)(5). U.S.C. 78s(b)(2). 27 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 26 15 E:\FR\FM\21APN1.SGM 21APN1 22252 Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices Exchange’s Web site (https:// www.c2exchange.com/Legal/), at the Exchange’s Office of the Secretary, 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 tkelley on DSK3SPTVN1PROD with NOTICES 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. Maker fee/ (rebate) Public Customer ....... C2 Market-Maker ...... All Other Origins (Professional Customer, Firm, Broker/Dealer, nonC2 Market-Maker, JBO, etc.) .............. Trades on the Open * ($.75) .85 .85 .00 Exchange proposes to consolidate its Fees Schedule and add ‘‘equities’’ to Section 1A and the current Section 1C (which will now be renumbered as ‘‘B’’). * ($.75) .85 The Exchange believes the proposed rule change will make the Fees Schedule easier to read and alleviate potential confusion. The Exchange notes that no substantive changes are being made by this change. Taker fee/ (rebate) .85 .00 2. Statutory Basis The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the ‘‘Act’’) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.4 Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 5 requirements that the rules of an exchange be designed to prevent A. Self-Regulatory Organization’s fraudulent and manipulative acts and Statement of the Purpose of, and practices, to promote just and equitable Statutory Basis for, the Proposed Rule principles of trade, to foster cooperation Change and coordination with persons engaged in regulating, clearing, settling, 1. Purpose processing information with respect to, The Exchange proposes to amend its and facilitating transactions in Fees Schedule.3 Specifically, the securities, to remove impediments to Exchange proposes to amend its fees for and perfect the mechanism of a free and the Russell 2000 Index (‘‘RUT’’). As of open market and a national market April 1, 2015, RUT is listed exclusively system, and, in general, to protect RUT on C2 and Chicago Board Options investors and the public interest. Exchange, Incorporated (‘‘CBOE’’). As Public Customer ........................... $.15 Additionally, the Exchange believes the such, the Exchange proposes to make C2 Market-Maker .......................... .35 proposed rule change is consistent with conforming changes to its Fees All Other Origins (Professional Section 6(b)(4) of the Act,6 which Customer, Firm, Broker/Dealer, Schedule. requires that Exchange rules provide for non-C2 Market-Maker, JBO, the equitable allocation of reasonable Currently the Exchange assesses etc.) ........................................... .55 different fees and rebates for simple and Trades on the Open ..................... .00 dues, fees, and other charges among its Trading Permit Holders and other complex RUT orders. Specifically, for simple, non-complex RUT orders, the Additionally, the Exchange notes that persons using its facilities. Exchange assesses the following perit currently assesses an Index License The Exchange believes it is reasonable contract fees structure (rebates in Surcharge for RUT (‘‘RUT Surcharge’’) to charge different fee amounts to parentheses): of $0.30 per contract for all non-Public different user types in the manner Customer orders. The Exchange now proposed because the proposed fees are Maker Taker fee proposes to increase the RUT Surcharge consistent with the price differentiation from $0.30 to 0.45 per contract in order that exists today at other options Public Customer ....... * ($.75) $.80 to recoup the increased costs associated exchanges (for example, the proposed C2 Market-Maker ...... .00 .80 with the RUT license. The Exchange fees are comparable with fees for other All Other Origins will still be subsidizing the costs of the index option products, traded on CBOE (Professional CusRUT license. -including RUT 7). Additionally, while tomer, Firm, Finally, the Exchange proposes to the Exchange notes that the fee structure Broker/Dealer, nondelete sections (B) and (D) from Section for RUT is changing from a Maker-Taker C2 Market-Maker, JBO, etc.) .............. .50 .80 1 of the Fees Schedule. The Exchange structure to a standard transaction fees Trades on the Open .00 .00 notes that as of January 2015, the fees structure, the Exchange believes the for simple, non-complex orders in proposed fee amounts for RUT orders equities, multiply-listed index, ETF, and are reasonable because the proposed fee For complex orders in RUT, the ETN options classes are the same and amounts are within the range of Exchange currently assesses the the fees for complex orders in equities, standard transaction fee amounts following per-contract fees structure multiply-listed index, ETF, and ETN (rebates in parentheses): options classes are the same (i.e., there 4 15 U.S.C. 78f(b). is no longer a distinction between fees 5 15 U.S.C. 78f(b)(5). 3 C2 initially filed the proposed fee change on and rebates for equities options class 6 15 U.S.C. 78f(b)(4). March 31, 2015 (SR–C2–2015–004). On April 10, and multiply-listed index, ETF, and 7 See CBOE Fees Schedule, Specified Proprietary 2015, C2 withdrew that filing and submitted this ETN options classes). As such, the Index Options Rate Table. filing. VerDate Sep<11>2014 18:07 Apr 20, 2015 Jkt 235001 The Exchange notes that for both simple and complex RUT orders, rebates do not apply to orders that trade with Public Customer complex orders. In such circumstances, there is no fee or rebate. In light of the new licensing arrangement for RUT, the Exchange seeks to amend its RUT fees structure. Specifically, the Exchange seeks to eliminate the Maker-Taker fee structure for RUT and instead adopt standard transaction fees. The Exchange also proposes to eliminate the Public Customer rebates for RUT, as well as change the current fee amounts assessed. The Exchange notes that Trades on the Open will continue to not be assessed a fee or rebate. For both simple and non-complex RUT orders, the Exchange proposes to assess the following per-contract fees: PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 E:\FR\FM\21APN1.SGM 21APN1 tkelley on DSK3SPTVN1PROD with NOTICES Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices charged for RUT at another exchange (i.e., CBOE).8 The Exchange believes it is reasonable, equitable and not unfairly discriminatory to eliminate the rebates for Public Customers for RUT transactions because the Exchange devotes a lot of resources to developing and maintain an exclusively-listed product and therefore does not desire to offer a rebate associated with exclusively-listed products. The Exchange notes that this proposed change will apply to all Public Customers for all RUT transactions. The Exchange also believes that it is equitable and not unfairly discriminatory to assess lower fees to Public Customers as compared to other market participants because Public Customer order flow enhances liquidity on the Exchange for the benefit of all market participants. Specifically, Public Customer liquidity benefits all market participants by providing more trading opportunities, which attracts MarketMakers. An increase in the activity of these market participants in turn facilitates tighter spreads, which may cause an additional corresponding increase in order flow from other market participants. Moreover, the options industry has a long history of providing preferential pricing to Public Customers, and the Exchange’s current Fees Schedule currently does so in many places, as do the fees structures of many other exchanges. Finally, all fee amounts listed as applying to Public Customers will be applied equally to all Public Customers (meaning that all Public Customers will be assessed the same amount). The Exchange believes that it is equitable and not unfairly discriminatory to, assess lower fees to Market-Makers as compared to other market participants other than Public Customers because Market-Makers, unlike other market participants, take on a number of obligations, including quoting obligations, that other market participants do not have. Further, these lower fees offered to Market-Makers are intended to incent Market-Makers to quote and trade more on C2, thereby providing more trading opportunities for all market participants. Finally, all fee amounts listed as applying to Market-Makers will be applied equally to all Market-Makers (meaning that all Market-Makers will be assessed the same amount). Similarly, the Exchange notes that the RUT fee amounts for each 8 See CBOE Fees Schedule, Specified Proprietary Index Options Rate Table, which shows that standard transaction fees for RUT orders range from $0.18 per contract to $0.65 per contract. VerDate Sep<11>2014 18:07 Apr 20, 2015 Jkt 235001 separate type of other market participants will be assessed equally to all such market participants (i.e. all Broker-Dealer orders will be assessed the same amount, all Joint Back-Office orders will be assessed the same amount, etc.). The Exchange believes increasing the RUT Surcharge is reasonable because the Exchange still pays more for the RUT license than the amount of the proposed RUT Surcharge (meaning that the Exchange is, and will still be, subsidizing the costs of the RUT license). This increase is equitable and not unfairly discriminatory because the increased amount will be assessed to all market participants to whom the RUT Surcharge applies. Not applying the RUT Index License Surcharge Fee to Public Customer orders is equitable and not unfairly discriminatory because this is designed to attract Public Customer RUT orders, which increases liquidity and provides greater trading opportunities to all market participants. The Exchange believes that the proposed new fee structure for simple and complex RUT options is equitable and not unfairly discriminatory because the structure and fee amounts are identical for both simple and complex RUT orders. Finally, the Exchange believes that eliminating sections B and D of Section 1 of the Fees Schedule and consolidating it with current sections A and C, respectively, maintains clarity in the Fees Schedule and promotes just and equitable principles of trade by eliminating potential confusion and removing impediments to and perfecting the mechanism of a free and open market and a national market system. B. Self-Regulatory Organization’s Statement on Burden on Competition C2 does not believe that the proposed rule changes will impose any burden on competition that are not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe that the proposed rule change will impose any burden on intramarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because, while different fees are assessed to different market participants in some circumstances, these different market participants have different obligations and different circumstances as discussed above. For example, MarketMakers have quoting obligations that other market participants do not have. Further, the proposed fees structure for RUT is intended to encourage more trading of RUT, which brings liquidity PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 22253 to the Exchange and benefits all market participants. The Exchange does not believe that the proposed rule changes will impose any burden on intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act because RUT will now be exclusively listed on C2 (and CBOE). To the extent that the proposed changes make C2 a more attractive marketplace for market participants at other exchanges, such market participants are welcome to become C2 market participants. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 9 and paragraph (f) of Rule 19b–4 10 thereunder. 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. If the Commission takes such action, the Commission will institute proceedings to determine whether the proposed rule change 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– C2–2015–007 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. 9 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f). 10 17 E:\FR\FM\21APN1.SGM 21APN1 22254 Federal Register / Vol. 80, No. 76 / Tuesday, April 21, 2015 / Notices All submissions should refer to File Number SR–C2–2015–007. 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 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–C2– 2015–007 and should be submitted on or before May 12, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.11 Brent J. Fields, Secretary. [FR Doc. 2015–09069 Filed 4–20–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION tkelley on DSK3SPTVN1PROD with NOTICES Sunshine Act Meeting Notice is hereby given, pursuant to the provisions of the Government in the Sunshine Act, Public Law 94–409, that the Securities and Exchange Commission will hold a Closed Meeting on Thursday, April 23, 2015 at 2 p.m. Commissioners, Counsel to the Commissioners, the Secretary to the Commission, and recording secretaries will attend the Closed Meeting. Certain staff members who have an interest in the matters also may be present. The General Counsel of the Commission, or her designee, has 11 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 18:07 Apr 20, 2015 Jkt 235001 certified that, in her opinion, one or more of the exemptions set forth in 5 U.S.C. 552b(c)(3), (5), (7), 9(B) and (10) and 17 CFR 200.402(a)(3), (5), (7), 9(ii) and (10), permit consideration of the scheduled matter at the Closed Meeting. Commissioner Piwowar, as duty officer, voted to consider the items listed for the Closed Meeting in closed session, and determined that no earlier notice thereof was possible. The subject matter of the Closed Meeting will be: Institution and settlement of injunctive actions; Institution and settlement of administrative proceedings; and Other matters relating to enforcement proceedings. At times, changes in Commission priorities require alterations in the scheduling of meeting items. For further information and to ascertain what, if any, matters have been added, deleted or postponed, please contact the Office of the Secretary at (202) 551–5400. Dated: April 16, 2015. Brent J. Fields, Secretary. [FR Doc. 2015–09320 Filed 4–17–15; 11:15 am] BILLING CODE 8011–01–P SMALL BUSINESS ADMINISTRATION Data Collection Available for Public Comments 60-day notice and request for comments. ACTION: The Small Business Administration (SBA) intends to request approval, from the Office of Management and Budget (OMB) for the collection of information described below. The Paperwork Reduction Act (PRA) of 1995, 44 U.S.C. chapter 35 requires federal agencies to publish a notice in the Federal Register concerning each proposed collection of information before submission to OMB, and to allow 60 days for public comment in response to the notice. This notice complies with that requirement. DATES: Submit comments on or before June 22, 2015. ADDRESSES: Send all comments to Melinda Edwards, Program Analyst, Office of Business Development, Small Business Administration, 409 3rd Street, 8th Floor, Washington, DC 20416. FOR FURTHER INFORMATION CONTACT: Melinda Edwards, Program Analyst, Business Development, Melinda.edwards@sba.gov 202–619– 1843, or Curtis B. Rich, Management SUMMARY: PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 Analyst, 202–205–7030, curtis.rich@ sba.gov. SUPPLEMENTARY INFORMATION: All 8(a) participants are required to provide semiannual information on any agents, representatives, attorneys, and accounts receiving compensation to assist in obtaining a Federal contract for the participant. The information addresses the amount of compensation received and description of the activities performed in return for such compensation. The information is used to ensure that participants do not engage in any improper or illegal activity in connection with obtaining a contract. Solicitation of Public Comments SBA is requesting comments on (a) Whether the collection of information is necessary for the agency to properly perform its functions; (b) whether the burden estimates are accurate; (c) whether there are ways to minimize the burden, including through the use of automated techniques or other forms of information technology; and (d) whether there are ways to enhance the quality, utility, and clarity of the information. Summary of Information Collection Title: Representatives Used and Compensation Paid for Services in Connection with Obtaining Federal Contracts. Description of Respondents: 8(a) Program Participants. Form Number: SBA Form 1790. Total Estimated Annual Responses: 15,628. Total Estimated Annual Hour Burden: 3,907. Curtis B. Rich, Management Analyst. [FR Doc. 2015–09205 Filed 4–20–15; 8:45 am] BILLING CODE 8025–01–P SMALL BUSINESS ADMINISTRATION [Disaster Declaration #14276 and #14277] Rhode Island Disaster #RI–00014 U.S. Small Business Administration. ACTION: Notice. AGENCY: This is a Notice of the Presidential declaration of a major disaster for Public Assistance Only for the State of Rhode Island (FEMA–4212– DR), dated 04/03/2015. Incident: Severe Winter Storm and Snowstorm. Incident Period: 01/26/2015 through 01/28/2015 Effective Date: 04/03/2015. Physical Loan Application Deadline Date: 06/02/2015. SUMMARY: E:\FR\FM\21APN1.SGM 21APN1

Agencies

[Federal Register Volume 80, Number 76 (Tuesday, April 21, 2015)]
[Notices]
[Pages 22251-22254]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-09069]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74733; File No. SR-C2-2015-007]


Self-Regulatory Organizations; C2 Options Exchange, Incorporated; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
To Amend the Fees Schedule

April 15, 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 April 10, 2015, C2 Options Exchange, Incorporated (the 
``Exchange'' or ``C2'') 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 
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 its Fees Schedule. The text of the 
proposed rule change is available on the

[[Page 22252]]

Exchange's Web site (https://www.c2exchange.com/Legal/), at the 
Exchange's Office of the Secretary, and at the Commission's Public 
Reference Room.

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

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant 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 its Fees Schedule.\3\ Specifically, 
the Exchange proposes to amend its fees for the Russell 2000 Index 
(``RUT''). As of April 1, 2015, RUT is listed exclusively on C2 and 
Chicago Board Options Exchange, Incorporated (``CBOE''). As such, the 
Exchange proposes to make conforming changes to its Fees Schedule.
---------------------------------------------------------------------------

    \3\ C2 initially filed the proposed fee change on March 31, 2015 
(SR-C2-2015-004). On April 10, 2015, C2 withdrew that filing and 
submitted this filing.
---------------------------------------------------------------------------

    Currently the Exchange assesses different fees and rebates for 
simple and complex RUT orders. Specifically, for simple, non-complex 
RUT orders, the Exchange assesses the following per-contract fees 
structure (rebates in parentheses):

------------------------------------------------------------------------
                                                      Maker    Taker fee
------------------------------------------------------------------------
Public Customer...................................   * ($.75)       $.80
C2 Market-Maker...................................       .00         .80
All Other Origins (Professional Customer, Firm,          .50         .80
 Broker/Dealer, non-C2 Market-Maker, JBO, etc.)...
Trades on the Open................................       .00         .00
------------------------------------------------------------------------

    For complex orders in RUT, the Exchange currently assesses the 
following per-contract fees structure (rebates in parentheses):

------------------------------------------------------------------------
                                                    Maker fee/ Taker fee/
                                                     (rebate)   (rebate)
------------------------------------------------------------------------
Public Customer...................................   * ($.75)   * ($.75)
C2 Market-Maker...................................       .85        .85
All Other Origins (Professional Customer, Firm,          .85        .85
 Broker/Dealer, non-C2 Market-Maker, JBO, etc.)...
Trades on the Open................................       .00        .00
------------------------------------------------------------------------

    The Exchange notes that for both simple and complex RUT orders, 
rebates do not apply to orders that trade with Public Customer complex 
orders. In such circumstances, there is no fee or rebate. In light of 
the new licensing arrangement for RUT, the Exchange seeks to amend its 
RUT fees structure. Specifically, the Exchange seeks to eliminate the 
Maker-Taker fee structure for RUT and instead adopt standard 
transaction fees. The Exchange also proposes to eliminate the Public 
Customer rebates for RUT, as well as change the current fee amounts 
assessed. The Exchange notes that Trades on the Open will continue to 
not be assessed a fee or rebate. For both simple and non-complex RUT 
orders, the Exchange proposes to assess the following per-contract 
fees:

------------------------------------------------------------------------
                             RUT
------------------------------------------------------------------------
Public Customer..............................................       $.15
C2 Market-Maker..............................................        .35
All Other Origins (Professional Customer, Firm, Broker/              .55
 Dealer, non-C2 Market-Maker, JBO, etc.).....................
Trades on the Open...........................................        .00
------------------------------------------------------------------------

    Additionally, the Exchange notes that it currently assesses an 
Index License Surcharge for RUT (``RUT Surcharge'') of $0.30 per 
contract for all non-Public Customer orders. The Exchange now proposes 
to increase the RUT Surcharge from $0.30 to 0.45 per contract in order 
to recoup the increased costs associated with the RUT license. The 
Exchange will still be subsidizing the costs of the RUT license.
    Finally, the Exchange proposes to delete sections (B) and (D) from 
Section 1 of the Fees Schedule. The Exchange notes that as of January 
2015, the fees for simple, non-complex orders in equities, multiply-
listed index, ETF, and ETN options classes are the same and the fees 
for complex orders in equities, multiply-listed index, ETF, and ETN 
options classes are the same (i.e., there is no longer a distinction 
between fees and rebates for equities options class and multiply-listed 
index, ETF, and ETN options classes). As such, the Exchange proposes to 
consolidate its Fees Schedule and add ``equities'' to Section 1A and 
the current Section 1C (which will now be renumbered as ``B''). The 
Exchange believes the proposed rule change will make the Fees Schedule 
easier to read and alleviate potential confusion. The Exchange notes 
that no substantive changes are being made by this change.
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations thereunder applicable to the Exchange and, in particular, 
the requirements of Section 6(b) of the Act.\4\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \5\ requirements that the rules of an exchange be 
designed to prevent fraudulent and manipulative acts and practices, to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in regulating, clearing, 
settling, processing information with respect to, and facilitating 
transactions in securities, 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. Additionally, 
the Exchange believes the proposed rule change is consistent with 
Section 6(b)(4) of the Act,\6\ which requires that Exchange rules 
provide for the equitable allocation of reasonable dues, fees, and 
other charges among its Trading Permit Holders and other persons using 
its facilities.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(b)(5).
    \6\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes it is reasonable to charge different fee 
amounts to different user types in the manner proposed because the 
proposed fees are consistent with the price differentiation that exists 
today at other options exchanges (for example, the proposed fees are 
comparable with fees for other index option products, traded on CBOE -
including RUT \7\). Additionally, while the Exchange notes that the fee 
structure for RUT is changing from a Maker-Taker structure to a 
standard transaction fees structure, the Exchange believes the proposed 
fee amounts for RUT orders are reasonable because the proposed fee 
amounts are within the range of standard transaction fee amounts

[[Page 22253]]

charged for RUT at another exchange (i.e., CBOE).\8\
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    \7\ See CBOE Fees Schedule, Specified Proprietary Index Options 
Rate Table.
    \8\ See CBOE Fees Schedule, Specified Proprietary Index Options 
Rate Table, which shows that standard transaction fees for RUT 
orders range from $0.18 per contract to $0.65 per contract.
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    The Exchange believes it is reasonable, equitable and not unfairly 
discriminatory to eliminate the rebates for Public Customers for RUT 
transactions because the Exchange devotes a lot of resources to 
developing and maintain an exclusively-listed product and therefore 
does not desire to offer a rebate associated with exclusively-listed 
products. The Exchange notes that this proposed change will apply to 
all Public Customers for all RUT transactions. The Exchange also 
believes that it is equitable and not unfairly discriminatory to assess 
lower fees to Public Customers as compared to other market participants 
because Public Customer order flow enhances liquidity on the Exchange 
for the benefit of all market participants. Specifically, Public 
Customer liquidity benefits all market participants by providing more 
trading opportunities, which attracts Market-Makers. An increase in the 
activity of these market participants in turn facilitates tighter 
spreads, which may cause an additional corresponding increase in order 
flow from other market participants. Moreover, the options industry has 
a long history of providing preferential pricing to Public Customers, 
and the Exchange's current Fees Schedule currently does so in many 
places, as do the fees structures of many other exchanges. Finally, all 
fee amounts listed as applying to Public Customers will be applied 
equally to all Public Customers (meaning that all Public Customers will 
be assessed the same amount).
    The Exchange believes that it is equitable and not unfairly 
discriminatory to, assess lower fees to Market-Makers as compared to 
other market participants other than Public Customers because Market-
Makers, unlike other market participants, take on a number of 
obligations, including quoting obligations, that other market 
participants do not have. Further, these lower fees offered to Market-
Makers are intended to incent Market-Makers to quote and trade more on 
C2, thereby providing more trading opportunities for all market 
participants. Finally, all fee amounts listed as applying to Market-
Makers will be applied equally to all Market-Makers (meaning that all 
Market-Makers will be assessed the same amount). Similarly, the 
Exchange notes that the RUT fee amounts for each separate type of other 
market participants will be assessed equally to all such market 
participants (i.e. all Broker-Dealer orders will be assessed the same 
amount, all Joint Back-Office orders will be assessed the same amount, 
etc.).
    The Exchange believes increasing the RUT Surcharge is reasonable 
because the Exchange still pays more for the RUT license than the 
amount of the proposed RUT Surcharge (meaning that the Exchange is, and 
will still be, subsidizing the costs of the RUT license). This increase 
is equitable and not unfairly discriminatory because the increased 
amount will be assessed to all market participants to whom the RUT 
Surcharge applies. Not applying the RUT Index License Surcharge Fee to 
Public Customer orders is equitable and not unfairly discriminatory 
because this is designed to attract Public Customer RUT orders, which 
increases liquidity and provides greater trading opportunities to all 
market participants.
    The Exchange believes that the proposed new fee structure for 
simple and complex RUT options is equitable and not unfairly 
discriminatory because the structure and fee amounts are identical for 
both simple and complex RUT orders.
    Finally, the Exchange believes that eliminating sections B and D of 
Section 1 of the Fees Schedule and consolidating it with current 
sections A and C, respectively, maintains clarity in the Fees Schedule 
and promotes just and equitable principles of trade by eliminating 
potential confusion and removing impediments to and perfecting the 
mechanism of a free and open market and a national market system.

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

    C2 does not believe that the proposed rule changes will impose any 
burden on competition that are not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange does not believe 
that the proposed rule change will impose any burden on intramarket 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act because, while different fees are assessed to 
different market participants in some circumstances, these different 
market participants have different obligations and different 
circumstances as discussed above. For example, Market-Makers have 
quoting obligations that other market participants do not have. 
Further, the proposed fees structure for RUT is intended to encourage 
more trading of RUT, which brings liquidity to the Exchange and 
benefits all market participants.
    The Exchange does not believe that the proposed rule changes will 
impose any burden on intermarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act because RUT will 
now be exclusively listed on C2 (and CBOE). To the extent that the 
proposed changes make C2 a more attractive marketplace for market 
participants at other exchanges, such market participants are welcome 
to become C2 market participants.

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

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

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \9\ and paragraph (f) of Rule 19b-4 \10\ 
thereunder. 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. If the Commission 
takes such action, the Commission will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-C2-2015-007 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.


[[Page 22254]]


All submissions should refer to File Number SR-C2-2015-007. 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 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-C2-2015-007 and should be 
submitted on or before May 12, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-09069 Filed 4-20-15; 8:45 am]
 BILLING CODE 8011-01-P
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