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, 54625-54627 [2015-22743]

Download as PDF Federal Register / Vol. 80, No. 175 / Thursday, September 10, 2015 / Notices credits for these transactions will be higher, they will only be assessed against the portion of the order that executes against a response in the auctions. The Exchange believes that participants submitting responses in these auctions are willing to pay a higher fee for liquidity discovery in less liquid names. Further, as stated above the fees and credits proposed are in line with the facilitation and solicitation fees and credits on at least one other options exchange. BOX believes that this proposal will enhance competition between exchanges because it is designed to allow the Exchange to better compete with other exchanges for Facilitation and Solicitation auction order flow. 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 22 and Rule 19b–4(f)(2) thereunder,23 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 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: 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–2015–29. 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– 2015–29, and should be submitted on or before October 1, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.24 Robert W. Errett, Deputy Secretary. [FR Doc. 2015–22741 Filed 9–9–15; 8:45 am] BILLING CODE 8011–01–P mstockstill on DSK4VPTVN1PROD with NOTICES Electronic Comments • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– BOX–2015–29 on the subject line. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–75828; File No. SR–BOX– 2015–30] 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 September 3, 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 September 1, 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. While changes to the fee schedule pursuant to this proposal will be effective upon filing, the changes will become operative on September 1, 2015. 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 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 22 15 23 17 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). VerDate Sep<11>2014 17:28 Sep 09, 2015 24 17 Jkt 235001 PO 00000 CFR 200.30–3(a)(12). Frm 00115 Fmt 4703 Sfmt 4703 54625 E:\FR\FM\10SEN1.SGM 10SEN1 54626 Federal Register / Vol. 80, No. 175 / Thursday, September 10, 2015 / Notices 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 mstockstill on DSK4VPTVN1PROD with NOTICES 1. Purpose The Exchange proposes to amend the Fee Schedule for trading on BOX to amend how PIP and COPIP Orders 5 executing on the BOX Book are treated within the BOX Fee Schedule. Specifically, the Exchange proposes to now treat both sides of these transactions as Non-Auction transactions in regards to both Exchange Fees (Section I) and Liquidity Fees and Credits (Section II). While this type of interaction is not common, the Exchange believes that doing so will add greater clarity to the Fee Schedule and reduce Participant confusion about how these executions are treated. The Exchange first proposes to add subsection 3 to Section I.B. (PIP and COPIP Orders Executed Against Orders on the BOX Book) and state that each PIP or COPIP Order which executes against an Unrelated Order on the BOX Book shall be treated as a Non-Auction transaction and be subject to Section I.A. Exchange Fees (Non-Auction Transactions).6 The Exchange then proposes to amend Section II.A. (PIP and COPIP Transactions) to add language which specifies that each PIP Order or COPIP Order that executes against an Unrelated Order on the BOX Book shall be treated as a Non-Auction transaction and deemed exempt from Liquidity Fees and Credits. The Exchange does not believe that this change will have a noticeable impact on the fees assessed on its Participants.7 Almost all PIP and COPIP Orders executing against orders on the BOX Book will be Public Customer orders, which are not assessed an Exchange fee. Similarly, under the NonAuction fee structure Public Customers are also never assessed a fee. The Exchange notes that the Public Customer in this scenario may actually 5 A PIP Order or COPIP Order is a Customer Order (an agency order for the account of either a customer or a broker-dealer) designated for the PIP or COPIP, respectively. 6 For the PIP, an Unrelated Order is a nonImprovement Order entered into the BOX market during a PIP. For the COPIP, an Unrelated Order is a non-Improvement Order entered on BOX during a COPIP or BOX Book Interest during a COPIP. 7 The Exchange notes that in almost all scenarios the PIP and COPIP Order would be considered a taker of liquidity for purposes of the Non-Auction transaction fee structure. VerDate Sep<11>2014 17:28 Sep 09, 2015 Jkt 235001 receive an additional rebate of up to $0.70 under Section I.A.1. (Tiered Volume Rebate for Non-Auction Transactions.) While unlikely that a Participant other than a Public Customer would be interacting with the order on the BOX Book, the Exchange notes that a Market Maker who submits a PIP or COPIP Order that executes against an order on the BOX Book would be charged anywhere from $0.05 to $0.55 in Penny Pilot Classes and $0.10 to $0.90 in NonPenny Pilot Classes depending on the Participant type that the Order interacted with. The Market Maker would also be eligible for the Tiered Volume Rebate of up to $0.10 per contract depending on its monthly average daily volume. Comparatively, the same Market Maker would be assessed a $0.20 Exchange fee for the PIP and COPIP Order and a credit for removing liquidity of $0.35 (Penny Pilot Classes) and $0.75 (Non-Penny Pilot Classes). A Professional Customer or Broker Dealer who submits a PIP or COPIP Order that executes against an order on the BOX Book could be charged anywhere from $0.40 to $0.64 in Penny Pilot Classes and $0.40 to $0.99 in NonPenny Pilot Classes. The same Professional Customer or Broker Dealer would be assessed a $0.37 Exchange fee for the PIP and COPIP Order and a credit for removing liquidity of $0.35 (Penny Pilot Classes) and $0.75 (NonPenny Pilot Classes). The Exchange also proposes to remove obsolete language in this subsection that references immediately marketable Unrelated Orders, specifically the language that states that ‘‘an Unrelated Order that is not immediately marketable will be charged as an Improvement Order when it executes against a PIP Order or a COPIP Order,’’ as well as ‘‘When a nonimmediately marketable order executes against a PIP Order or a COPIP Order, therefore becoming an Unrelated Order, it shall be charged as an Improvement Order.’’ Since the introduction of the pro-rata allocation algorithm within the PIP and COPIP,8 all Unrelated Orders are systematically treated as immediately marketable. Therefore the Exchange believes this language is no longer necessary and removing it will reduce participant confusion about how these executions are treated within the Fee Schedule. The Exchange also 8 See Securities Exchange Act Release No. 72848 (August 14, 2014), 79 FR 49361 (August 20, 2014)(Order Granting Approval of a Proposed Rule Change To Adopt New Trade Allocation Algorithms for Matching Trades at the Conclusion of the PIP and the COPIP). PO 00000 Frm 00116 Fmt 4703 Sfmt 4703 proposes to remove footnotes which are referenced in the text that is being removed. The Exchange notes that the fees for immediately marketable Unrelated Orders remain unchanged. These orders continue to be charged as Non-Auction transactions for purposes of the BOX Fee schedule. 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,9 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 proposed changes will allow the Exchange to be competitive with other exchanges and to apply fees and credits in a manner that is equitable among all BOX Participants. Further, the Exchange operates within a highly competitive market in which market participants can readily direct order flow to any other competing exchange if they determine fees at a particular exchange to be excessive. The Exchange believes treating PIP and COPIP Orders that execute against an Unrelated Order on the BOX Book as Non-Auction transactions is reasonable, equitable and not unfairly discriminatory. As the Exchange noted above, almost all PIP and COPIP Orders are from the accounts of Public Customers. If this type of interaction does take place the Public Customer will still not be charged a fee and may also receive a credit depending on its ADV for the month. Additionally, the Exchange believes it is reasonable to potentially assess Market Makers, Broker Dealers, and Professional Customers with higher fees if their PIP or COPIP Orders execute on the BOX Book. While this scenario is rare, the Exchange notes that it has adopted similar methodology for Complex Orders that execute on the BOX Book, and while the result of this structure is that the BOX Participant does not know the fee it will be charged when submitting a PIP or COPIP Order, the Participant must recognize that it could be charged the highest applicable fee on the exchange’s schedule. For example, while a Market Maker’s PIP Order in a Penny Pilot Class would currently expect to be charged a $0.20 exchange fee and receive a $0.35 removal ‘‘credit’’ if the Order executed 9 15 E:\FR\FM\10SEN1.SGM U.S.C. 78f(b)(4) and (5). 10SEN1 Federal Register / Vol. 80, No. 175 / Thursday, September 10, 2015 / Notices against a Primary Improvement Order or Improvement Order in the PIP or COPIP, if that Order interacted with an Unrelated Order on the BOX Book the Market Maker could now be charged anywhere from $0.00 to $0.51. Therefore, the Participant must recognize that it could be charged the highest applicable fee on the Exchange’s schedule, which may, instead, be lowered or changed depending upon how the PIP or COPIP Order interacts. This way, a Participant will never be charged a higher fee than they expected when submitting a PIP or COPIP Order. Further, a majority of PIP and COPIP Orders execute as intended in the PIP and COPIP mechanisms, so the Exchange believes that any increase in fees will be nominal at most. Finally, the Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing exchanges. In such an environment, the Exchange must continually review, and consider adjusting, its fees and credits to remain competitive with other exchanges. For the reasons described above, the Exchange believes that the proposed rule change reflects this competitive environment. mstockstill on DSK4VPTVN1PROD with NOTICES 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 also does not believe that this change would disincentivize a market participant from sending in a PIP or COPIP Order, as the proposed rule change is meant to provide clarity to the BOX Fee Schedule so that Participants understand the fees they can be charged in this scenario. Under the proposed change PIP and COPIP Orders that execute against an Unrelated Order on the BOX Book will be subject to fees already in place on the Exchange. Further, almost all these transactions the PIP or COPIP Order will be from the account of the Public Customer and there will be no change to the fees assessed on these Participants. In rare cases, Market Makers, Broker Dealers and Professional Customers could be assessed a higher fee but the Exchange believes any fees assessed would be nominal. Finally, the Exchange does not believes that treating PIP and COPIP Orders that execute against an Unrelated Order on the BOX Book as Non-Auction transactions will impose a burden on competition among various Exchange 17:28 Sep 09, 2015 Jkt 235001 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 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 B. Self-Regulatory Organization’s Statement on Burden on Competition VerDate Sep<11>2014 Participants because all Participants will be affected to the same extent. 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–2015–30 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–2015–30. 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– 2015–30, and should be submitted on or before October 1, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.12 Robert W. Errett, Deputy Secretary. [FR Doc. 2015–22743 Filed 9–9–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–75836; File No. SR–ICC– 2015–013] Self-Regulatory Organizations; ICE Clear Credit LLC; Notice of Designation of Longer Period for Commission Action on Proposed Rule Change To Provide for the Clearance of Additional Western European Sovereign Single Names September 3, 2015. On July 6, 2015, ICE Clear Credit LLC (‘‘ICC’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to provide the basis for ICC to clear additional credit default swap contracts (SR–ICC–2015– 013). The proposed rule change was published for comment in the Federal 12 17 10 15 U.S.C. 78s(b)(3)(A)(ii). 11 17 CFR 240.19b–4(f)(2). PO 00000 Frm 00117 Fmt 4703 Sfmt 4703 54627 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\10SEN1.SGM 10SEN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 80, Number 175 (Thursday, September 10, 2015)]
[Notices]
[Pages 54625-54627]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-22743]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75828; File No. SR-BOX-2015-30]

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

September 3, 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 September 1, 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. While changes to the fee
schedule pursuant to this proposal will be effective upon filing, the
changes will become operative on September 1, 2015. 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

[[Page 54626]]

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 the Fee Schedule for trading on BOX
to amend how PIP and COPIP Orders \5\ executing on the BOX Book are
treated within the BOX Fee Schedule. Specifically, the Exchange
proposes to now treat both sides of these transactions as Non-Auction
transactions in regards to both Exchange Fees (Section I) and Liquidity
Fees and Credits (Section II). While this type of interaction is not
common, the Exchange believes that doing so will add greater clarity to
the Fee Schedule and reduce Participant confusion about how these
executions are treated.
---------------------------------------------------------------------------

\5\ A PIP Order or COPIP Order is a Customer Order (an agency
order for the account of either a customer or a broker-dealer)
designated for the PIP or COPIP, respectively.
---------------------------------------------------------------------------

The Exchange first proposes to add subsection 3 to Section I.B.
(PIP and COPIP Orders Executed Against Orders on the BOX Book) and
state that each PIP or COPIP Order which executes against an Unrelated
Order on the BOX Book shall be treated as a Non-Auction transaction and
be subject to Section I.A. Exchange Fees (Non-Auction Transactions).\6\
The Exchange then proposes to amend Section II.A. (PIP and COPIP
Transactions) to add language which specifies that each PIP Order or
COPIP Order that executes against an Unrelated Order on the BOX Book
shall be treated as a Non-Auction transaction and deemed exempt from
Liquidity Fees and Credits.
---------------------------------------------------------------------------

\6\ For the PIP, an Unrelated Order is a non-Improvement Order
entered into the BOX market during a PIP. For the COPIP, an
Unrelated Order is a non-Improvement Order entered on BOX during a
COPIP or BOX Book Interest during a COPIP.
---------------------------------------------------------------------------

The Exchange does not believe that this change will have a
noticeable impact on the fees assessed on its Participants.\7\ Almost
all PIP and COPIP Orders executing against orders on the BOX Book will
be Public Customer orders, which are not assessed an Exchange fee.
Similarly, under the Non-Auction fee structure Public Customers are
also never assessed a fee. The Exchange notes that the Public Customer
in this scenario may actually receive an additional rebate of up to
$0.70 under Section I.A.1. (Tiered Volume Rebate for Non-Auction
Transactions.)
---------------------------------------------------------------------------

\7\ The Exchange notes that in almost all scenarios the PIP and
COPIP Order would be considered a taker of liquidity for purposes of
the Non-Auction transaction fee structure.
---------------------------------------------------------------------------

While unlikely that a Participant other than a Public Customer
would be interacting with the order on the BOX Book, the Exchange notes
that a Market Maker who submits a PIP or COPIP Order that executes
against an order on the BOX Book would be charged anywhere from $0.05
to $0.55 in Penny Pilot Classes and $0.10 to $0.90 in Non-Penny Pilot
Classes depending on the Participant type that the Order interacted
with. The Market Maker would also be eligible for the Tiered Volume
Rebate of up to $0.10 per contract depending on its monthly average
daily volume. Comparatively, the same Market Maker would be assessed a
$0.20 Exchange fee for the PIP and COPIP Order and a credit for
removing liquidity of $0.35 (Penny Pilot Classes) and $0.75 (Non-Penny
Pilot Classes).
A Professional Customer or Broker Dealer who submits a PIP or COPIP
Order that executes against an order on the BOX Book could be charged
anywhere from $0.40 to $0.64 in Penny Pilot Classes and $0.40 to $0.99
in Non-Penny Pilot Classes. The same Professional Customer or Broker
Dealer would be assessed a $0.37 Exchange fee for the PIP and COPIP
Order and a credit for removing liquidity of $0.35 (Penny Pilot
Classes) and $0.75 (Non-Penny Pilot Classes).
The Exchange also proposes to remove obsolete language in this
subsection that references immediately marketable Unrelated Orders,
specifically the language that states that ``an Unrelated Order that is
not immediately marketable will be charged as an Improvement Order when
it executes against a PIP Order or a COPIP Order,'' as well as ``When a
non-immediately marketable order executes against a PIP Order or a
COPIP Order, therefore becoming an Unrelated Order, it shall be charged
as an Improvement Order.'' Since the introduction of the pro-rata
allocation algorithm within the PIP and COPIP,\8\ all Unrelated Orders
are systematically treated as immediately marketable. Therefore the
Exchange believes this language is no longer necessary and removing it
will reduce participant confusion about how these executions are
treated within the Fee Schedule. The Exchange also proposes to remove
footnotes which are referenced in the text that is being removed.
---------------------------------------------------------------------------

\8\ See Securities Exchange Act Release No. 72848 (August 14,
2014), 79 FR 49361 (August 20, 2014)(Order Granting Approval of a
Proposed Rule Change To Adopt New Trade Allocation Algorithms for
Matching Trades at the Conclusion of the PIP and the COPIP).
---------------------------------------------------------------------------

The Exchange notes that the fees for immediately marketable
Unrelated Orders remain unchanged. These orders continue to be charged
as Non-Auction transactions for purposes of the BOX Fee schedule.
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,\9\ 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 proposed changes will allow the Exchange to be
competitive with other exchanges and to apply fees and credits in a
manner that is equitable among all BOX Participants. Further, the
Exchange operates within a highly competitive market in which market
participants can readily direct order flow to any other competing
exchange if they determine fees at a particular exchange to be
excessive.
---------------------------------------------------------------------------

\9\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

The Exchange believes treating PIP and COPIP Orders that execute
against an Unrelated Order on the BOX Book as Non-Auction transactions
is reasonable, equitable and not unfairly discriminatory. As the
Exchange noted above, almost all PIP and COPIP Orders are from the
accounts of Public Customers. If this type of interaction does take
place the Public Customer will still not be charged a fee and may also
receive a credit depending on its ADV for the month.
Additionally, the Exchange believes it is reasonable to potentially
assess Market Makers, Broker Dealers, and Professional Customers with
higher fees if their PIP or COPIP Orders execute on the BOX Book. While
this scenario is rare, the Exchange notes that it has adopted similar
methodology for Complex Orders that execute on the BOX Book, and while
the result of this structure is that the BOX Participant does not know
the fee it will be charged when submitting a PIP or COPIP Order, the
Participant must recognize that it could be charged the highest
applicable fee on the exchange's schedule. For example, while a Market
Maker's PIP Order in a Penny Pilot Class would currently expect to be
charged a $0.20 exchange fee and receive a $0.35 removal ``credit'' if
the Order executed

[[Page 54627]]

against a Primary Improvement Order or Improvement Order in the PIP or
COPIP, if that Order interacted with an Unrelated Order on the BOX Book
the Market Maker could now be charged anywhere from $0.00 to $0.51.
Therefore, the Participant must recognize that it could be charged the
highest applicable fee on the Exchange's schedule, which may, instead,
be lowered or changed depending upon how the PIP or COPIP Order
interacts. This way, a Participant will never be charged a higher fee
than they expected when submitting a PIP or COPIP Order. Further, a
majority of PIP and COPIP Orders execute as intended in the PIP and
COPIP mechanisms, so the Exchange believes that any increase in fees
will be nominal at most.
Finally, the Exchange notes that it operates in a highly
competitive market in which market participants can readily favor
competing exchanges. In such an environment, the Exchange must
continually review, and consider adjusting, its fees and credits to
remain competitive with other exchanges. For the reasons described
above, the Exchange believes that the proposed rule change reflects
this competitive environment.

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 also does not
believe that this change would disincentivize a market participant from
sending in a PIP or COPIP Order, as the proposed rule change is meant
to provide clarity to the BOX Fee Schedule so that Participants
understand the fees they can be charged in this scenario. Under the
proposed change PIP and COPIP Orders that execute against an Unrelated
Order on the BOX Book will be subject to fees already in place on the
Exchange. Further, almost all these transactions the PIP or COPIP Order
will be from the account of the Public Customer and there will be no
change to the fees assessed on these Participants. In rare cases,
Market Makers, Broker Dealers and Professional Customers could be
assessed a higher fee but the Exchange believes any fees assessed would
be nominal.
Finally, the Exchange does not believes that treating PIP and COPIP
Orders that execute against an Unrelated Order on the BOX Book as Non-
Auction transactions will impose a burden on competition among various
Exchange Participants because all Participants will be affected to the
same extent.

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-2015-30 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-2015-30. 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-2015-30, and should be
submitted on or before October 1, 2015.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-22743 Filed 9-9-15; 8:45 am]
BILLING CODE 8011-01-P

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