Self-Regulatory Organizations; NASDAQ BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding Fees and Rebates Applicable to Firms and To Adopt Tiers Applicable to Options Overlying SPY, 8558-8566 [2016-03392]
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<![CDATA[
8558
Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Register on December 30, 2015.3 On
January 15, 2016, the Exchange
submitted Amendment No. 1 to the
proposed rule change.4 On January 27,
2016, the Exchange submitted
Amendment No. 2 to the proposed rule
change.5 On February 11, 2016, the
Exchange submitted Amendment No. 3
to the proposed rule change.6 The
Commission has received no comments
on the proposal.
Section 19(b)(2) of the Act 7 provides
that within 45 days of the publication of
notice of the filing of a proposed rule
change, or within such longer period up
to 90 days as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding, or as to which the
self-regulatory organization consents,
the Commission shall either approve the
proposed rule change, disapprove the
proposed rule change, or institute
3 See Securities Exchange Act Release No. 76761
(December 23, 2015), 80 FR 81564.
4 In Amendment No. 1, which replaced and
superseded the original filing in its entirety, the
Exchange clarified the Funds’ direct and indirect
principal and other investments; the determination
of the value of certain underlying assets for
purposes of the Funds’ net asset value calculation;
and the availability of price information for certain
underlying assets. Because Amendment No. 1 is a
technical amendment that adds clarification to the
proposal and does not materially alter the substance
of the proposed rule change or raise unique or novel
regulatory issues, Amendment No. 1 is not subject
to notice and comment (Amendment No. 1 to the
proposed rule change is available at: https://
www.sec.gov/comments/sr-nysearca-2015-107/
nysearca2015107-1.pdf).
5 In Amendment No. 2, the Exchange made
additional clarifying changes regarding the Funds’
other investments; the availability of price
information for certain underlying assets; and the
dissemination of the Portfolio Indicative Value.
Because Amendment No. 2 is a technical
amendment that adds clarification to the proposal
and does not materially alter the substance of the
proposed rule change or raise unique or novel
regulatory issues, Amendment No. 2 is not subject
to notice and comment (Amendment No. 2 to the
proposed rule change is available at: https://
www.sec.gov/comments/sr-nysearca-2015-107/
nysearca2015107-2.pdf).
6 In Amendment No. 3, the Exchange expanded
the application of the criteria for non-U.S. equity
securities in the REX Gold Hedged FTSE Emerging
Markets ETF portfolio so that they will apply on a
continual basis. Because Amendment No. 3 does
not materially alter the substance of the proposed
rule change or raise unique or novel regulatory
issues, Amendment No. 3 is not subject to notice
and comment.
7 15 U.S.C. 78s(b)(2).
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Jkt 238001
proceedings to determine whether the
proposed rule change should be
disapproved. The 45th day after
publication of the notice for this
proposed rule change is February 13,
2016. The Commission is extending this
45-day time period.
The Commission finds it appropriate
to designate a longer period within
which to take action on the proposed
rule change so that it has sufficient time
to consider this proposed rule change.
Accordingly, the Commission, pursuant
to Section 19(b)(2) of the Act,8
designates March 29, 2016, as the date
by which the Commission shall either
approve or disapprove, or institute
proceedings to determine whether to
disapprove, the proposed rule change
(File No. SR–NYSEArca–2015–107), as
modified by Amendment Nos. 1, 2, and
3 thereto.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–03391 Filed 2–18–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–77129; File No. SR–BX–
2016–010]
Self-Regulatory Organizations;
NASDAQ BX, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Regarding Fees and
Rebates Applicable to Firms and To
Adopt Tiers Applicable to Options
Overlying SPY
February 12, 2016.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on February
1, 2016, NASDAQ BX, Inc. (‘‘BX’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission (‘‘SEC’’ or
‘‘Commission’’) the proposed rule
change as described in Items I, II, and
8 15
U.S.C. 78s(b)(2).
CFR 200.30–3(a)(31).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
9 17
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Frm 00085
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Sfmt 4703
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
Options Pricing at Chapter XV Section
2, entitled ‘‘BX Options Market—Fees
and Rebates,’’ which governs pricing for
BX members using the BX Options
Market (‘‘BX Options’’). The Exchange
proposes to modify certain fees and
rebates (per executed contract) to: (1)
Adopt fees and rebates applicable to
Firm 3 and (2) adopt tiers applicable to
options overlying Standard and Poor’s
Depositary Receipts/SPDRs (‘‘SPY’’).4
The text of the proposed rule change
is available on the Exchange’s Web site
at https://nasdaqomxbx.
cchwallstreet.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
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
3 The term ‘‘Firm’’ or (‘‘F’’) applies to any
transaction that is identified by a Participant for
clearing in the Firm range at OCC. BX Chapter XV.
4 SPY options are based on the SPDR exchangetraded fund (‘‘ETF’’), which is designed to track the
performance of the S&P 500 Index, and are Penny
Pilot Options. The Penny Pilot was established in
June 2012 and extended in 2015. See Securities
Exchange Act Release Nos. 67256 (June 26, 2012),
77 FR 39277 (July 2, 2012) (SR–BX–2012–030)
(order approving BX option rules and establishing
Penny Pilot); and 75326 (June 29, 2015), 80 FR
38481 (July 6, 2015) (SR–BX–2015–037) (notice of
filing and immediate effectiveness extending the
Penny Pilot through June 30, 2016).
E:\FR\FM\19FEN1.SGM
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Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend its
Chapter XV, Section 2 to modify
subsection (1) regarding certain fees and
rebates 5 (known as ‘‘fees and rebates’’)
to (1) adopt fees and rebates applicable
to Firm; and (2) adopt tiers applicable
to options overlying SPY (the ‘‘SPY
Option Tier Schedule’’). The proposed
modified fees and rebates (per executed
contract) and new SPY Option Tier
Schedule would apply to Customers,6
BX Options Market Makers,7 NonCustomers 8 and Firms.
Each specific change is described in
detail below.
Currently, Chapter XV, Section 2
subsection (1) reads as follows:
(1) Fees for Execution of Contracts on
the BX Options Market:
FEES AND REBATES
[Per executed contract]
BX Options
Market Maker
Customer
Penny Pilot Options:
Rebate to Add Liquidity ............................................................................................
Fee to Add Liquidity .................................................................................................
Rebate to Remove Liquidity .....................................................................................
Fee to Remove Liquidity ..........................................................................................
Non-Penny Pilot Options:
Rebate to Add Liquidity ............................................................................................
Fee to Add Liquidity .................................................................................................
Rebate to Remove Liquidity .....................................................................................
Fee to Remove Liquidity ..........................................................................................
2 $0.10
#
#
#
N/A
*
*
*
N/A
Non-Customer 1
N/A
$0.45
N/A
$0.46
3$0.39
N/A
#
N/A
N/A
$0.98
N/A
$0.89
5 $0.50/$0.95
N/A
*
1A
Non-Customer includes a Professional, Firm, Broker-Dealer and Non-BX Options Market Maker.
Rebate to Add Liquidity will be paid to a BX Options Market Maker only when the BX Options Market Maker is contra to a Non-Customer
or BX Options Market Maker.
3 The Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options Market Maker is contra to a Customer.
4 Reserved
5 The higher Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options Market Maker is contra to a
Customer.
2 The
# PENNY PILOT OPTIONS TIER SCHEDULE
Rebate to add
liquidity
Fee to add liquidity
Rebate to remove
liquidity
Fee to remove
liquidity
Fee to remove
liquidity
When ...................................................
Customer .............
Customer .............
Customer ..............
Trading with ........................................
Non-Customer or
BX Options Market Maker.
Customer ..............
Non-Customer, BX
Options Market
Maker, or Customer.
BX Options Market
Maker.
Customer ..............
BX Options Market
Maker.
Non-Customer or
BX Options Market Maker.
$0.00 ....................
$0.39 ....................
$0.00 ....................
$0.39 ....................
$0.46.
$0.10 ....................
$0.39 ....................
$0.25 ....................
$0.39 ....................
$0.46.
$0.20 ....................
$0.39 ....................
$0.35 ....................
$0.30 ....................
$0.46.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Tier 1:
Participant executes less than
0.05% of total industry customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to
less than 0.15% of total industry customer equity and ETF
option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or
more of total industry customer
equity and ETF option ADV
contracts per month.
5 Fees and rebates are per executed contract.
Chapter XV, Section 2(1).
6 The term ‘‘Customer’’ or (‘‘C’’) applies to any
transaction that is identified by a Participant for
clearing in the Customer range at The Options
Clearing Corporation (‘‘OCC’’) which is not for the
account of broker or dealer or for the account of a
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‘‘Professional’’ (as that term is defined in Chapter
I, Section 1(a)(48)). BX Chapter XV.
7 BX Options Market Makers may also be referred
to as ‘‘Market Makers’’. The term ‘‘BX Options
Market Maker’’ or (‘‘M’’) means a Participant that
has registered as a Market Maker on BX Options
pursuant to Chapter VII, Section 2, and must also
remain in good standing pursuant to Chapter VII,
PO 00000
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Fmt 4703
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Section 4. In order to receive Market Maker pricing
in all securities, the Participant must be registered
as a BX Options Market Maker in at least one
security. BX Chapter XV.
8 Note 1 to Chapter XV, Section 2 states: ‘‘1A NonCustomer includes a Professional, Firm, BrokerDealer and Non-BX Options Market Maker.’’ Firm
is proposed to be removed from the note.
E:\FR\FM\19FEN1.SGM
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Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
* NON-PENNY PILOT OPTIONS TIER SCHEDULE
Rebate to add
liquidity
Fee to add liquidity
Rebate to remove
liquidity
Fee to remove
liquidity
Fee to remove
liquidity
When ...................................................
Customer .............
Customer .............
Customer ..............
Trading with ........................................
Non-Customer or
BX Options Market Maker.
Customer ..............
Non-Customer, BX
Options Market
Maker, or Customer.
BX Options Market
Maker.
Customer ..............
BX Options Market
Maker.
Non-Customer or
BX Options Market Maker.
$0.00 ....................
$0.85 ....................
$0.80 ....................
$0.89 ....................
$0.89.
$0.10 ....................
$0.85 ....................
$0.80 ....................
$0.89 ....................
$0.89.
$0.20 ....................
$0.85 ....................
$0.80 ....................
$0.60 ....................
$0.89.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Tier 1:
Participant executes less than
0.05% of total industry customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to
less than 0.15% of total industry customer equity and ETF
option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or
more of total industry customer
equity and ETF option ADV
contracts per month.
Change 1—Penny Pilot Options: Modify
Fees and Rebates To Add Firm Column
In Change 1, the Exchange proposes
modifications to its fees and rebates for
Penny Pilot Options 9 and for NonPenny Pilot Options to add a new Firm
column. The proposed Firm column
would have exactly the same
assessments or rates as the current NonCustomer column, which now includes
Firm.10 The Exchange notes that by
adding the new Firm column it is not
changing any fees and rebates for Firm.
Rather, all fees and rebates applicable to
Firm are now in the new Firm column
but remain exactly the same as they are
currently for Firm when it is part of the
Non-Customer column. Commensurate
with the proposed Firm column, the
Exchange also proposes to change notes
1 and 2 so that these notes read
properly. The Exchange proposes to take
out ‘‘Firm’’ in note 1 and to add ‘‘Firm’’
in note 2.
The proposed change keeps current
fees and rebates assessments intact.
Thus, for Penny Pilot Options: The
Rebate to Add Liquidity would remain
at N/A for Non-Customer and would be
the same for Firm; the Fee to Add
Liquidity would remain at $0.45 for
Non-Customer and would be the same
for Firm; the Rebate to Remove
9 The greatest volume options traded on the
Exchange and in the options market are Penny Pilot
Options, and in particular SPY Options, and the
Exchange has taken this into account when
structuring and modifying its fee and rebate
schedule.
10 Currently, note 1 states: ‘‘A Non-Customer
includes a Professional, Firm, Broker-Dealer and
Non-BX Options Market Maker.’’
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Liquidity would remain at N/A for NonCustomer and would be the same for
Firm; and the Fee to Remove Liquidity
would remain at $0.46 for non-Customer
and would be the same for Firm. Thus,
for Non-Penny Pilot Options: The
Rebate to Add Liquidity would remain
at N/A for Non-Customer and would be
the same for Firm; the Fee to Add
Liquidity would remain at $0.98 for
non-Customer and would be the same
for Firm; the Rebate to Remove
Liquidity would remain at N/A for NonCustomer and would be the same for
Firm; and the Fee to Add Liquidity
would remain at $0.89 for non-Customer
and would be the same for Firm.
Chapter XV, Section 2 subsection (1)
reflecting the proposed new Firm
column is set forth below.
Market Maker, or Firm 11), Fee to Add
Liquidity for BX Market Maker (when
trading with Customer), Rebate to
Remove Liquidity for Customer (when
trading with Non-Customer, BX Options
Market Maker, Customer, or Firm), and
Fee to Remove Liquidity for BX Options
Market Maker (when trading with
Customer). The Exchange also proposes
several explanatory notes applicable to
the SPY Option Tier Schedule.
Proposed Tier 1 in the SPY Options
Tier Schedule will be where a BX
Participant (‘‘Participant’’) executes less
than 0.05% of total industry customer
equity and exchange traded fund
(‘‘ETF’’) option average daily volume
(‘‘ADV’’) contracts per month. Proposed
Tier 1 will range from a $0.00 rebate to
a $0.42 fee:
Change 2—Penny Pilot Options: Modify
Fees and Rebates To Add SPY Options
Tiers
—The new Rebate to Add Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
or Firm will be $0.00 (no rebate will
be paid); 12
In Change 2, the Exchange proposes
modifications to its current Penny Pilot
Options Tier Schedule to indicate that
this particular schedule does not apply
to SPY Options and that for SPY
Options pricing there will be a separate
SPY Options Tier Schedule. The
Exchange proposes new The Tier 1, Tier
2, and Tier 3 requirements which will
be similar to tiers in the current Penny
Pilot Options Tier Schedule; and a new
Tier 4.
Specifically, the Exchange proposes to
add SPY Options Tiers 1–4 for Rebate to
Add Liquidity for Customer (when
trading with Non-Customer, BX Options
PO 00000
Frm 00087
Fmt 4703
Sfmt 4703
11 Commensurate with establishing a Firm
column, and in particular indicating Firm in the
new SPY Options Tier Schedule, the Exchange
proposes to add Firm in the Non-Penny Pilot
Options Tier Schedule (e.g., Rebate to Add
Liquidity, Rebate to Remove Liquidity, Fee to
Remove Liquidity).
12 The new Rebate to Add Liquidity is similar to
what is in the current Penny Pilot Options Tier
Schedule. However, in the new rebate the Exchange
proposes to add that the rebate is also applicable
when trading with Firm, which is proposed to be
separate from Non-Customer. For purposes of
conformity, Firm is proposed to be added to the
Rebate to Add Liquidity for Customer in the Penny
Pilot Tier Schedule, the SPY Options Tier
Schedule, and the Non-Penny Pilot Tier Schedule.
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Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
—the new Fee to Add Liquidity when
BX Options Market Maker trading
with Customer will be $0.42; 13
—the new Rebate to Remove Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
Customer, or Firm will be $0.00; 14
and
—the new Fee to Remove Liquidity
when BX Options Market Maker
trading with Customer will be
$0.42.15
Proposed Tier 2 in the SPY Options
Tier Schedule will be where Participant
executes 0.05% to less than 0.15% of
total industry customer equity and ETF
option ADV contracts per month.
Proposed Tier 2 will range from a $0.25
rebate to a $0.42 fee:
—The new Rebate to Add Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
or Firm will be $0.10.16
—the new Fee to Add Liquidity when
BX Options Market Maker trading
with Customer will be $0.42; 17
—the new Rebate to Remove Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
Customer, or Firm will be $0.25; 18
and
—the new Fee to Remove Liquidity
when BX Options Market Maker
trading with Customer will be
$0.42.19
Proposed Tier 3 in the SPY Options
Tier Schedule will be where Participant
executes 0.15% or more of total industry
customer equity and ETF option ADV
contracts per month. Proposed Tier 3
will range from a $0.37 rebate to a $0.39
fee:
—The new Rebate to Add Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
or Firm will be $0.20.20
—the new Fee to Add Liquidity when
BX Options Market Maker trading
with Customer will be $0.39; 21
—the new Rebate to Remove Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
Customer, or Firm will be $0.37; 22
and
—the new Fee to Remove Liquidity
when BX Options Market Maker
trading with Customer will be
$0.39.23
Proposed Tier 4 in the SPY Options
Tier Schedule, which has no equivalent
in the Penny Pilot Options Tier
Schedule, will be where Participant
executes greater than 5,000 ADV in BX
Price Improvement Auction (‘‘PRISM’’)
Agency Contracts.24 If a Participant
qualifies for Tier 4 the rates applicable
to this tier will supersede any other SPY
tier rates that the Participant may that
[sic] qualify for. Proposed Tier 4 will
range from a $0.37 rebate to a $0.32 fee:
—The new Rebate to Add Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
or Firm will be $0.25.
—the new Fee to Add Liquidity when
BX Options Market Maker trading
with Customer will be $0.32;
—the new Rebate to Remove Liquidity
when Customer trading with NonCustomer, BX Options Market Maker,
Customer, or Firm will be $0.37; and
—the new Fee to Remove Liquidity
when BX Options Market Maker
trading with Customer will be $0.25.
In addition, the Exchange proposes
several explanatory notes at the end of
the SPY Options Tier Schedule:
—BX Options Market Maker fee to add
liquidity in SPY Options will be $0.00
when trading with Firm, NonCustomer, or BX Options Market
Maker;
—Firm fee to add liquidity and fee to
remove liquidity in SPY Options will
be $0.33 per contract, regardless of
counterparty;
—Non-Customer fee to add liquidity
and fee to remove liquidity in SPY
Options will be $0.46 per contract,
regardless of counterparty;
—BX Options Market Maker fee to
remove liquidity in SPY Options will
be $0.46 per contract when trading
with Firm, Non-Customer, or BX
Options Market Maker;
—Customer fee to add liquidity in SPY
Options when contra to another
Customer is $0.33 per contract; and
—Volume from all products listed on
BX Options will apply to the SPY
Options Tiers. Chapter XV, Section 2
subsection (1) reflecting all proposed
changes will read as follows:
(1) Fees for Execution of Contracts on
the BX Options Market:
FEES AND REBATES
[Per executed contract]
BX Options
Market
Maker
Customer
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Penny Pilot Options (Excluding Options in SPY):
Rebate to Add Liquidity ............................................................................
Fee to Add Liquidity .................................................................................
Rebate to Remove Liquidity .....................................................................
13 There is no similar fee in the current Penny
Pilot Options Tier Schedule.
14 The new Rebate to Remove Liquidity is similar
to what is in the current Penny Pilot Options Tier
Schedule. However, in the new rebate the Exchange
proposes to add that the rebate is also applicable
when trading with Firm, which is proposed to be
separate from Non-Customer. For purposes of
conformity, Firm is proposed to be added to the
Rebate to Add [sic] Liquidity for Customer in the
Penny Pilot Tier Schedule, the SPY Options Tier
Schedule, and the Non-Penny Pilot Tier Schedule.
15 The Fee to Remove Liquidity is $0.39 in the
current Penny Pilot Options Tier Schedule.
However, in the new rebate the Exchange proposes
to add that the rebate is also applicable when
trading with Firm, which is proposed to be separate
from Non-Customer. For purposes of conformity,
Firm is proposed to be added to the Rebate to Add
Liquidity for Customer in the Penny Pilot Tier
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17:59 Feb 18, 2016
Jkt 238001
#
#
#
Schedule, the SPY Options Tier Schedule, and the
Non-Penny Pilot Tier Schedule.
16 The new Rebate to Add Liquidity is similar to
what is in the current Penny Pilot Options Tier
Schedule.
17 There is no similar fee in the current Penny
Pilot Options Tier Schedule.
18 The new Rebate to Remove Liquidity is similar
to what is in the current Penny Pilot Options Tier
Schedule.
19 The Fee to Remove Liquidity is $0.39 in the
current Penny Pilot Options Tier Schedule.
20 The Rebate to Add Liquidity is similar to what
is in the current Penny Pilot Options Tier Schedule.
21 There is no similar fee in the current Penny
Pilot Options Tier Schedule.
22 The Rebate to Remove Liquidity is $0.35 in the
current Penny Pilot Options Tier Schedule.
23 The Fee to Remove Liquidity is $0.30 in the
current Penny Pilot Options Tier Schedule.
PO 00000
Frm 00088
Fmt 4703
Sfmt 4703
2 $0.10
3 $0.39
N/A
Non-Customer 1
N/A
$0.45
N/A
Firm
N/A
$0.45
N/A
24 PRISM is a Price Improvement Mechanism for
all-electronic BX Options whereby a buy and sell
order may be submitted in one order message to
initiate an auction at a stop price and seek potential
price improvement. Options are traded
electronically on BX Options, and all options
participants may respond to a PRISM Auction, the
duration of which is set at 200 milliseconds. PRISM
includes auto-match functionality in which a
Participant (an ‘‘Initiating Participant’’) may
electronically submit for execution an order it
represents as agent on behalf of customer, n6 [sic]
broker dealer, or any other entity (‘‘PRISM Order’’)
against principal interest or against any other order
it represents as agent (an ‘‘Initiating Order’’)
provided it submits the PRISM Order for electronic
execution into the PRISM Auction pursuant [sic].
See Chapter VI, Section 9; and Securities Exchange
Act Release No. 76301 (October 29, 2015), 80 FR
68347 (November 4, 2015) (SR–BX–2015–032)
(order approving BX PRISM).
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Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
FEES AND REBATES—Continued
[Per executed contract]
Customer
Fee to Remove Liquidity ...........................................................................
Non-Penny Pilot Options:
Rebate to Add Liquidity ............................................................................
Fee to Add Liquidity .................................................................................
Rebate to Remove Liquidity .....................................................................
Fee to Remove Liquidity ...........................................................................
BX Options
Market
Maker
N/A
*
*
*
N/A
Non-Customer 1
Firm
#
$0.46
$0.46
N/A
N/A
$0.98
N/A
$0.89
N/A
$0.98
N/A
$0.89
5 $0.50/$0.95
N/A
*
1A
Non-Customer includes a Professional, Broker-Dealer and Non-BX Options Market Maker.
Rebate to Add Liquidity will be paid to a BX Options Market Maker only when the BX Option Market Maker is contra to a Non-Customer,
Firm, or BX Options Market Maker.
3 The Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options Market Maker is contra to a Customer.
4 Reserved.
5 The higher Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options Market Maker is contra to a
Customer.
2 The
# PENNY PILOT OPTIONS TIER SCHEDULE
[Excluding SPY Options]
Rebate to add
liquidity
Fee to add liquidity
Rebate to remove
liquidity
Fee to remove
liquidity
Fee to remove
liquidity
When:
Customer ..............
Customer .............
Customer ..............
Trading with:
Non-Customer, BX
Options Market
Maker, or Firm.
Customer ..............
Non-Customer, BX
Options Market
Maker, Customer, or Firm.
BX Options Market
Maker.
Customer ..............
BX Options Market
Maker.
Non-Customer, BX
Options Market
Maker, or Firm.
$0.00 ....................
$0.39 ....................
$0.00 ....................
$0.39 ....................
$0.46.
$0.10 ....................
$0.39 ....................
$0.25 ....................
$0.39 ....................
$0.46.
$0.20 ....................
$0.39 ....................
$0.35 ....................
$0.30 ....................
$0.46.
Tier 1:
Participant executes less than
0.05% of total industry customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to
less than 0.15% of total industry customer equity and ETF
option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or
more of total industry customer
equity and ETF option ADV
contracts per month.
SPY OPTIONS TIER SCHEDULE
Fee to add liquidity
Rebate to remove
liquidity
When:
Customer ...................
Non-Customer, BX
Options Market
Maker, or Firm.
BX Options Market
Maker.
Customer ...................
Customer ...................
Trading with:
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Rebate to add liquidity
Tier 1:
Participant executes less than 0.05% of
total industry customer equity and
ETF option ADV contracts per month.
Tier 2:
Participant executes 0.05% to less than
0.15% of total industry customer equity and ETF option ADV contracts
per month.
Tier 3:
Participant executes 0.15% or more of
total industry customer equity and
ETF option ADV contracts per month.
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Non-Customer, BX
Options Market
Maker, Customer,
or Firm.
Fee to remove
liquidity
BX Options Market
Maker.
Customer.
$0.00 ..........................
$0.42 ..........................
$0.00 ..........................
$0.42.
$0.10 ..........................
$0.42 ..........................
$0.25 ..........................
$0.42.
$0.20 ..........................
$0.39 ..........................
$0.37 ..........................
$0.39.
PO 00000
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8563
Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
SPY OPTIONS TIER SCHEDULE—Continued
Rebate to add liquidity
Tier 4:
Participant executes greater than 5,000
ADV in PRISM Agency Contracts.
Fee to add liquidity
Rebate to remove
liquidity
$0.25 ..........................
$0.32 ..........................
$0.37 ..........................
Fee to remove
liquidity
$0.25.
• BX Options Market Maker fee to add liquidity in SPY Options will be $0.00 when trading with Firm, Non-Customer, or BX Options Market
Maker.
• Firm fee to add liquidity and fee to remove liquidity in SPY Options will be $0.33 per contract, regardless of counterparty.
• Non-Customer fee to add liquidity and fee to remove liquidity in SPY Options will be $0.46 per contract, regardless of counterparty.
• BX Options Market Maker fee to remove liquidity in SPY Options will be $0.46 per contract when trading with Firm, Non-Customer, or BX
Options Market Maker.
• Customer fee to add liquidity in SPY Options when contra to another Customer is $0.33 per contract.
• Volume from all products listed on BX Options will apply to the SPY Options Tiers.
* NON-PENNY PILOT OPTIONS TIER SCHEDULE
Rebate to add
liquidity
Fee to add liquidity
Rebate to remove
liquidity
Fee to remove
liquidity
Fee to remove
liquidity
When:
Customer ..............
Customer .............
Customer ..............
Trading with:
Non-Customer, BX
Options Market
Maker, or Firm.
Customer ..............
Non-Customer, BX
Options Market
Maker, Customer, or Firm.
BX Options Market
Maker.
Customer ..............
BX Options Market
Maker.
Non-Customer, BX
Options Market
Maker, or Firm.
$0.00 ....................
$0.85 ....................
$0.80 ....................
$0.89 ....................
$0.89.
$0.10 ....................
$0.85 ....................
$0.80 ....................
$0.89 ....................
$0.89.
$0.20 ....................
$0.85 ....................
$0.80 ....................
$0.60 ....................
$0.89.
Tier 1:
Participant executes less than
0.05% of total industry customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to
less than 0.15% of total industry customer equity and ETF
option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or
more of total industry customer
equity and ETF option ADV
contracts per month.
The Exchange is proposing fees and
rebate changes and adopting the SPY
Options Tier Schedule at this time
because it believes that this will provide
incentives for execution of contracts,
and in particular SPY Options contracts,
on the BX Options Market.
The Exchange also believes that its
proposal should provide increased
opportunities for participation in
executions on the Exchange, facilitating
the ability of the Exchange to bring
together participants and encourage
more robust competition for orders.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
2. Statutory Basis
The Exchange believes that its
proposal to amend its Pricing Schedule
is consistent with Section 6(b) of the
Act,25 in general, and furthers the
objectives of Section 6(b)(4) and (b)(5) of
the Act,26 in particular, in that it
provides for the equitable allocation of
25 15
26 15
27 Securities
Exchange Act Release No. 51808 at
37499 (June 9, 2005) (‘‘Regulation NMS Adopting
Release’’).
U.S.C. 78f(b).
U.S.C. 78f(b)(4), (5).
VerDate Sep<11>2014
17:59 Feb 18, 2016
reasonable dues, fees and other charges
among members and issuers and other
persons using any facility or system
which the Exchange operates or
controls, and is not designed to permit
unfair discrimination between
customers, issuers, brokers, or dealers.
The Commission and the courts have
repeatedly expressed their preference
for competition over regulatory
intervention in determining prices,
products, and services in the securities
markets. In Regulation NMS, while
adopting a series of steps to improve the
current market model, the Commission
highlighted the importance of market
forces in determining prices and SRO
revenues* [sic] and, also, recognized
that current regulation of the market
system ‘‘has been remarkably successful
in promoting market competition in its
broader forms that are most important to
investors and listed companies.’’ 27
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PO 00000
Frm 00090
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Likewise, in NetCoalition v. Securities
and Exchange Commission 28
(‘‘NetCoalition’’) the D.C. Circuit upheld
the Commission’s use of a market-based
approach in evaluating the fairness of
market data fees against a challenge
claiming that Congress mandated a costbased approach.29 As the court
emphasized, the Commission ‘‘intended
in Regulation NMS that ‘market forces,
rather than regulatory requirements’
play a role in determining the market
data . . . to be made available to
investors and at what cost.’’ 30
Further, ‘‘[n]o one disputes that
competition for order flow is ‘fierce.’
. . . As the SEC explained, ‘[i]n the U.S.
national market system, buyers and
sellers of securities, and the brokerdealers that act as their order-routing
agents, have a wide range of choices of
where to route orders for execution’;
28 NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir.
2010).
29 See id. at 534–535.
30 See id. at 537.
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[and] ‘no exchange can afford to take its
market share percentages for granted’
because ‘no exchange possesses a
monopoly, regulatory or otherwise, in
the execution of order flow from broker
dealers’. . . .’’ 31 Although the court and
the SEC were discussing the cash
equities markets, the Exchange believes
that these views apply with equal force
to the options markets.
The Exchange proposes to amend its
Chapter XV, Section 2 to modify
subsection (1) to adopt fees and rebates
applicable to Firm, and to adopt a new
SPY Option Tier Schedule. The
proposed modified fees and rebates and
new SPY Option Tier Schedule would,
as discussed, apply to Customers, BX
Options Market Makers, NonCustomers, and Firms. The Exchange
believes that its proposal is reasonable,
equitable, and not unfairly
discriminatory and should provide
increased opportunities for participation
in executions on the Exchange,
facilitating the ability of the Exchange to
bring together participants and
encourage more robust competition for
orders.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
Change 1—Penny Pilot Options: Modify
Fees and Rebates To Add Firm Column
In Change 1, the Exchange proposes
modifications to its fees and rebates for
Penny Pilot Options and for Non-Penny
Pilot Options to add a new Firm
column; and to make changes to notes
to properly reflect the use of the new
Firm column. The proposed Firm
column would have exactly the same
assessments or rates as the current NonCustomer column, which now includes
Firm.
The proposed change is reasonable
because it simply establishes a new
Firm column but keeps current fees and
rebate assessments intact. The proposed
rule change is reasonable because it
continues to encourage market
participant behavior through the fees
and rebates system, which is an
accepted methodology among options
exchanges.32 The proposed change is
also reasonable because it continues,
through the fees and rebates schedule,
to incentivize Participants to direct
Penny Pilot Options liquidity33 and
31 Id. at 539 (quoting Securities Exchange [sic]
Release No. 59039 (December 2, 2008), 73 FR 74770
(December 9, 2008) (SR–NYSEArca–2006–21) at 73
FR at 74782–74783).
32 See, e.g., fee and rebate schedules of other
options exchanges, including, but not limited to,
NASDAQ Options Market (‘‘NOM’’), NASDAQ
PHLX LLC (‘‘Phlx’’), and Chicago Board Options
Exchange (‘‘CBOE’’).
33 Penny Pilot Options, and in particular SPY
Options, represent the greatest volume options
traded on the Exchange and in the options market
and the Exchange has taken this into account when
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Jkt 238001
Non-Penny Pilot Options liquidity to
the Exchange.
The proposed rule change to fees and
rebates for Penny Pilot Options and for
Non-Penny Pilot Options to add a new
Firm column, and to make changes to
notes to properly reflect the use of the
new Firm column, is equitable and not
unfairly discriminatory. This is because
the Exchange’s proposal keeps current
fees and rebate assessments intact, and
the fees and rebates schedule will
continue to apply uniformly to all
similarly situated Participants.
The fees and rebates schedule as
proposed continues to reflect
differentiation among different market
participants. The Exchange believes that
the differentiation is equitable and not
unfairly discriminatory, as well as
reasonable, and notes that some market
participants like BX Options Market
Makers commit to various obligations.
For example, transactions of a BX
Options Market Maker must constitute a
course of dealings reasonably calculated
to contribute to the maintenance of a
fair and orderly market, and BX Options
Market Makers should not make bids or
offers or enter into transactions that are
inconsistent with such course of
dealings. Further, all BX Options Market
Makers are designated as specialists on
BX for all purposes under the Act or
rules thereunder.34
The Exchange believes that by making
the proposed Firm column change, it is
continuing to incentivize Participants to
execute more volume on the Exchange
to further enhance liquidity in this
market.
Change 2—Penny Pilot Options: Modify
Fees and Rebates To Add SPY Options
Tiers
In Change 2, the Exchange proposes
modifications to its current Penny Pilot
Options Tier Schedule to indicate that
this particular schedule does not apply
to SPY Options, and that for SPY
Options pricing there will be a separate
SPY Options Tier Schedule. The Tier 1,
Tier 2, and Tier 3 requirements in the
proposed SPY Options Tier Schedule
will be similar to the current Penny
Pilot Options Tier Schedule. The
Exchange also proposes a new Tier 4 for
the SPY Options Tier Schedule.
Specifically, the Exchange proposes to
add SPY Options Tiers 1–4 for Rebate to
Add Liquidity for Customer (when
trading with Non-Customer, BX Options
Market Maker, or Firm), Fee to Add
Liquidity for BX Market Maker (when
structuring and modifying its fee and rebate
schedule.
34 See Chapter VII, Section 5, entitled
‘‘Obligations of Market Makers.’’
PO 00000
Frm 00091
Fmt 4703
Sfmt 4703
trading with Customer), Rebate to
Remove Liquidity for Customer (when
trading with Non-Customer, BX Options
Market Maker, Customer, or Firm), and
Fee to Remove Liquidity or [sic] BX
Options Market Maker (when trading
with Customer). The Exchange also
proposes several explanatory notes
applicable to the SPY Option Tier
Schedule.
The Exchange believes that excluding
SPY Options pricing form the Penny
Pilot Options Tier Schedule and
establishing a separate SPY Options Tier
Schedule is reasonable because of the
nature of SPY options. These are most
heavily traded options on the Exchange
as well as in the industry.
The Exchange believes that the
proposed SPY Options Tier Schedule is
reasonable because it is not a novel,
untested structure but rather is similar
to what is offered by other options
markets,35 and, is based on the
Exchange’s Penny Pilot Options Tier
Schedule. The proposed Tiers in the
SPY Options Tier Schedule clearly
reflect the progressively increasing
nature of Participant executions
structured for the purpose of attracting
order flow to the Exchange. This
encourages market participant behavior
through progressive tiered fees and
rebates using an accepted methodology
among options exchanges.36 Tier 1 in
the SPY Options Tier Schedule is,
similarly to Tier 1 in the Penny Pilot
Options Tier Schedule, set up to enable
a Participant to earn a Rebate to Add
Liquidity or pay a Fee to Add Liquidity
in SPY where the Participant executes
less than 0.05% of total industry
customer equity and ETF option ADV
contracts per month. Tier 2 in the SPY
Options Tier Schedule is, similarly to
Tier 2 in the Penny Pilot Options Tier
Schedule, set up to enable a Participant
to earn a Rebate to Add Liquidity or pay
a Fee to Add Liquidity in SPY where the
Participant executes 0.05% to less than
0.15% of total industry customer equity
and ETF option ADV contracts per
month. And Tier 3 in the SPY Options
Tier Schedule is, similarly to Tier 3 in
the Penny Pilot Options Tier Schedule,
set up to [sic] Participant executes
0.15% or more of total industry
customer equity and ETF option ADV
contracts per month. The fees and
rebates that BX Options Market Makers
and Customers are assessed are, as has
been discussed at length, comparable to
35 See, e.g., the pricing schedule of Phlx. See also,
e.g., the pricing schedule of NASDAQ Options
Market (‘‘NOM’’).
36 See, e.g., fee and rebate schedules of other
options exchanges, including, but not limited to,
NOM, Phlx, and Chicago Board Options Exchange
(‘‘CBOE’’).
E:\FR\FM\19FEN1.SGM
19FEN1
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Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
the fees and rebates in the Penny Pilot
Options Tier Schedule. The Exchange
believes that it is reasonable to also
establish Tier 4 in the in the [sic] SPY
Options Tier Schedule in order to
enable a Participant to earn a Rebate to
Add Liquidity or pay a Fee to Add
Liquidity in SPY where the Participant
executes greater than 5,000 ADV in
certain PRISM Contracts. By so doing,
the Exchange encourages Participants to
trade Prism Contracts, which have been
recently approved for trading.37
In addition, the Exchange believes
that making changes to add the SPY
Options Tier Schedule in terms of
Rebate to Add Liquidity and Fee to Add
Liquidity, and Rebate to Remove
Liquidity and Fee to Remove Liquidity,
is reasonable because it encourages the
desired Customer behavior by attracting
Customer interest to the Exchange.
Customer activity enhances liquidity on
the Exchange for the benefit of all
market participants and 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.
The SPY Options Tier Schedule is
reasonable in that it is, like the Penny
Pilot Options Tier Schedule, set up to
incentivize Participants to direct
liquidity to the Exchange; using volume
from all products listed on BX Options
will further incentivize Participants. As
Participants execute more of total
industry customer equity and ETF
option ADV contracts per month on the
Exchange, they can in certain categories
earn higher rebates and be assessed
lower fees. For example, in the SPY
Options Tier Schedule the Tier 3 Rebate
to Add Liquidity when Customer
trading with Non-Customer, BX Options
Market Maker, or Firm is higher ($0.20)
than the Penny Pilot [sic] Tier 1 Rebate
to Add Liquidity ($0.00); and the Tier 3
Rebate to Remove Liquidity when
Customer trading with Non-Customer,
BX Options Market Maker, Customer, or
Firm is higher ($0.37) that [sic] the Tier
2 Rebate to Remove Liquidity ($0.25).
Similarly, the Fee to Add Liquidity
when BX Option Market Maker trading
with Customer is lesser for Tier 3
($0.39) than for Tier 1 ($0.42); and the
Fee to Remove Liquidity when BX
Option Market Maker trading with
Customer is less for Tier 3 ($0.39) than
for Tier 1 ($0.42).
37 See Securities Exchange Act Release No. 76301
(October 29, 2015), 80 FR 68347 (November 4, 2015)
(SR–BX–2015–032) (order approving BX PRISM).
VerDate Sep<11>2014
17:59 Feb 18, 2016
Jkt 238001
The Exchange believes that it is
reasonable to add notes to the SPY
Options Tier Schedule as they are
explanatory in nature. Five such notes
explain that unlike how new Tiers 1–4
function, certain fees (e.g. BX Options
Market Maker, Firm, Non-Customer, and
Customer) remain the same regardless of
counterparty. The Exchanges believes
that it is also reasonable for conformity
to indicate Firm across fees and rebates,
the new SPY Options Tier Schedule, the
Penny Pilot Options Tier Schedule, and
the Non-Penny Pilot Options Tier
Schedule.
Establishing the SPY Options Tier
Schedule, which includes new Tiers 1–
4, is equitable and not unfairly
discriminatory. This is because the
Exchange’s proposal to assess fees and
pay rebates according to Tiers 1, 2, 3,
and 4 will apply uniformly to all
similarly situated Participants.
Customers would earn a Rebate to Add
Liquidity and be assessed a Fee to Add
Liquidity according to the Tiers, and BX
Market Makers would earn a Rebate to
Remove Liquidity [sic] and a Fee to
Remove Liquidity according to the same
Tiers per the SPY Options Tier
Schedule; and certain fees would be the
same regardless of counterparty. The fee
and rebate schedule as proposed
continues to reflect differentiation
among different market participants.
The Exchange believes that the
differentiation is equitable and not
unfairly discriminatory, as well as
reasonable, because some market
participants like BX Options Market
Makers commit to obligations such as
that transactions must constitute a
course of dealings reasonably calculated
to contribute to the maintenance of a
fair and orderly market, and BX Options
Market Makers should not make bids or
offers or enter into transactions that are
inconsistent with such course of
dealings.
The Exchange believes that by making
the proposed Penny Pilot Options
changes it is incentivizing Participants
to execute more volume on the
Exchange to further enhance liquidity in
this market.
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. Specifically,
the Exchange does not believe that its
proposal to make changes to its Penny
Pilot Options and Non-Penny Pilot
Options fees and rebates and to
establish a SPY Options Tiers Schedule
PO 00000
Frm 00092
Fmt 4703
Sfmt 4703
8565
will impose any undue burden on
competition, as discussed below.
The Exchange operates in a highly
competitive market in which many
sophisticated and knowledgeable
market participants can readily and do
send order flow to competing exchanges
if they deem fee levels or rebate
incentives at a particular exchange to be
excessive or inadequate. Additionally,
new competitors have entered the
market and still others are reportedly
entering the market shortly. These
market forces ensure that the Exchange’s
fees and rebates remain competitive
with the fee structures at other trading
platforms. In that sense, the Exchange’s
proposal is actually pro-competitive
because the Exchange is simply
continuing its fees and rebates and [sic]
for Penny Pilot Options and Non-Penny
Pilot Options and establishing a SPY
Options Tiers Schedule in order to
remain competitive in the current
environment.
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. In terms of
inter-market competition, the Exchange
notes that it operates in a highly
competitive market in which market
participants can readily favor competing
venues if they deem fee levels at a
particular venue to be excessive, or
rebate opportunities available at other
venues to be more favorable. In such an
environment, the Exchange must
continually adjust its fees to remain
competitive with other exchanges and
with alternative trading systems that
have been exempted from compliance
with the statutory standards applicable
to exchanges. Because competitors are
free to modify their own fees in
response, and because market
participants may readily adjust their
order routing practices, the Exchange
believes that the degree to which fee
changes in this market may impose any
burden on competition is extremely
limited. In terms of intra-market
competition, the Exchange notes that
price differentiation among different
market participants operating on the
Exchange (e.g., Customer and BX
Options Market Maker) is reasonable.
Customer activity, for example,
enhances liquidity on the Exchange for
the benefit of all market participants
and benefits all market participants by
providing more trading opportunities,
which attracts market makers. An
increase in the activity of these market
participants (particularly in response to
pricing) in turn facilitates tighter
spreads, which may cause an additional
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Federal Register / Vol. 81, No. 33 / Friday, February 19, 2016 / Notices
corresponding increase in order flow
from other market participants.
Moreover, unlike others market
participants each BX Options Market
Maker commits to various obligations.
These obligations include, for example,
transactions of a BX Market Maker must
constitute a course of dealings
reasonably calculated to contribute to
the maintenance of a fair and orderly
market, and Market Makers should not
make bids or offers or enter into
transactions that are inconsistent with
such course of dealings.38
In this instance, the proposed changes
to the fees and rebates for Penny Pilot
Options and for Non-Penny Pilot
Options to add a new Firm column, and
establishing a SPY Options Tiers
Schedule, do not impose a burden on
competition because the Exchange’s
execution and routing services are
completely voluntary and subject to
extensive competition both from other
exchanges and from off-exchange
venues. If the changes proposed herein
are unattractive to market participants,
it is likely that the Exchange will lose
market share as a result. Accordingly,
the Exchange does not believe that the
proposed changes will impair the ability
of members or competing order
execution venues to maintain their
competitive standing in the financial
markets. Additionally, the changes
proposed herein are pro-competitive to
the extent that they continue to allow
the Exchange to promote and maintain
order executions.
asabaliauskas on DSK5VPTVN1PROD with NOTICES
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Pursuant to Section 19(b)(3)(A)(ii) of
the Act,39 the Exchange has designated
this proposal as establishing or changing
a due, fee, or other charge imposed by
the self-regulatory organization on any
person, whether or not the person is a
member of the self-regulatory
organization, which renders the
proposed rule change effective upon
filing.
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
38 See Chapter VII, Section 5, entitled
‘‘Obligations of Market Makers’’.
39 15 U.S.C. 78s(b)(3)(A)(ii).
VerDate Sep<11>2014
17:59 Feb 18, 2016
Jkt 238001
action is: (i) Necessary or appropriate in
the public interest; (ii) for the protection
of investors; or (iii) 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
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–
BX–2016–010 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–BX–2016–010. 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–BX–
Frm 00093
Fmt 4703
Sfmt 4703
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.40
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–03392 Filed 2–18–16; 8:45 am]
BILLING CODE 8011–01–P
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:
PO 00000
2016–010 and should be submitted on
or before March 11, 2016.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–77122; File No. 4–697]
Program for Allocation of Regulatory
Responsibilities Pursuant to Rule 17d–
2; Notice of Filing of Proposed Plan for
the Allocation of Regulatory
Responsibilities Between the Financial
Industry Regulatory Authority, Inc. and
ISE Mercury, LLC
February 11, 2016.
Pursuant to Section 17(d) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 17d–2 thereunder,2
notice is hereby given that on February
9, 2016, ISE Mercury, LLC (‘‘ISE
Mercury’’) and the Financial Industry
Regulatory Authority, Inc. (‘‘FINRA’’)
(together with ISE Mercury, the
‘‘Parties’’) filed with the Securities and
Exchange Commission (‘‘Commission’’
or ‘‘SEC’’) a plan for the allocation of
regulatory responsibilities, dated
February 8, 2016 (‘‘17d–2 Plan’’ or the
‘‘Plan’’). The Commission is publishing
this notice to solicit comments on the
17d–2 Plan from interested persons.
I. Introduction
Section 19(g)(1) of the Act,3 among
other things, requires every selfregulatory organization (‘‘SRO’’)
registered as either a national securities
exchange or national securities
association to examine for, and enforce
compliance by, its members and persons
associated with its members with the
Act, the rules and regulations
thereunder, and the SRO’s own rules,
unless the SRO is relieved of this
responsibility pursuant to Section 17(d)
or Section 19(g)(2) of the Act.4 Without
this relief, the statutory obligation of
each individual SRO could result in a
pattern of multiple examinations of
broker-dealers that maintain
memberships in more than one SRO
(‘‘common members’’) for compliance
with certain rules that are substantially
40 17
CFR 200.30–3(a)(12).
U.S.C. 78q(d).
2 17 CFR 240.17d–2.
3 15 U.S.C. 78s(g)(1).
4 15 U.S.C. 78q(d) and 15 U.S.C. 78s(g)(2),
respectively.
1 15
E:\FR\FM\19FEN1.SGM
19FEN1
]]>Agencies
[Federal Register Volume 81, Number 33 (Friday, February 19, 2016)]
[Notices]
[Pages 8558-8566]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-03392]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-77129; File No. SR-BX-2016-010]
Self-Regulatory Organizations; NASDAQ BX, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change Regarding Fees and
Rebates Applicable to Firms and To Adopt Tiers Applicable to Options
Overlying SPY
February 12, 2016.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on February 1, 2016, NASDAQ BX, Inc. (``BX'' or ``Exchange'') filed
with the Securities and Exchange Commission (``SEC'' or ``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 Options Pricing at Chapter XV
Section 2, entitled ``BX Options Market--Fees and Rebates,'' which
governs pricing for BX members using the BX Options Market (``BX
Options''). The Exchange proposes to modify certain fees and rebates
(per executed contract) to: (1) Adopt fees and rebates applicable to
Firm \3\ and (2) adopt tiers applicable to options overlying Standard
and Poor's Depositary Receipts/SPDRs (``SPY'').\4\
---------------------------------------------------------------------------
\3\ The term ``Firm'' or (``F'') applies to any transaction that
is identified by a Participant for clearing in the Firm range at
OCC. BX Chapter XV.
\4\ SPY options are based on the SPDR exchange-traded fund
(``ETF''), which is designed to track the performance of the S&P 500
Index, and are Penny Pilot Options. The Penny Pilot was established
in June 2012 and extended in 2015. See Securities Exchange Act
Release Nos. 67256 (June 26, 2012), 77 FR 39277 (July 2, 2012) (SR-
BX-2012-030) (order approving BX option rules and establishing Penny
Pilot); and 75326 (June 29, 2015), 80 FR 38481 (July 6, 2015) (SR-
BX-2015-037) (notice of filing and immediate effectiveness extending
the Penny Pilot through June 30, 2016).
---------------------------------------------------------------------------
The text of the proposed rule change is available on the Exchange's
Web site at https://nasdaqomxbx.cchwallstreet.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 Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
[[Page 8559]]
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 Chapter XV, Section 2 to modify
subsection (1) regarding certain fees and rebates \5\ (known as ``fees
and rebates'') to (1) adopt fees and rebates applicable to Firm; and
(2) adopt tiers applicable to options overlying SPY (the ``SPY Option
Tier Schedule''). The proposed modified fees and rebates (per executed
contract) and new SPY Option Tier Schedule would apply to Customers,\6\
BX Options Market Makers,\7\ Non-Customers \8\ and Firms.
---------------------------------------------------------------------------
\5\ Fees and rebates are per executed contract. Chapter XV,
Section 2(1).
\6\ The term ``Customer'' or (``C'') applies to any transaction
that is identified by a Participant for clearing in the Customer
range at The Options Clearing Corporation (``OCC'') which is not for
the account of broker or dealer or for the account of a
``Professional'' (as that term is defined in Chapter I, Section
1(a)(48)). BX Chapter XV.
\7\ BX Options Market Makers may also be referred to as ``Market
Makers''. The term ``BX Options Market Maker'' or (``M'') means a
Participant that has registered as a Market Maker on BX Options
pursuant to Chapter VII, Section 2, and must also remain in good
standing pursuant to Chapter VII, Section 4. In order to receive
Market Maker pricing in all securities, the Participant must be
registered as a BX Options Market Maker in at least one security. BX
Chapter XV.
\8\ Note 1 to Chapter XV, Section 2 states: ``\1\A Non-Customer
includes a Professional, Firm, Broker-Dealer and Non-BX Options
Market Maker.'' Firm is proposed to be removed from the note.
---------------------------------------------------------------------------
Each specific change is described in detail below.
Currently, Chapter XV, Section 2 subsection (1) reads as follows:
(1) Fees for Execution of Contracts on the BX Options Market:
Fees and Rebates
[Per executed contract]
----------------------------------------------------------------------------------------------------------------
BX Options
Customer Market Maker Non-Customer \1\
----------------------------------------------------------------------------------------------------------------
Penny Pilot Options:
Rebate to Add Liquidity............................... # \2\ $0.10 N/A
Fee to Add Liquidity.................................. # \3\$0.39 $0.45
Rebate to Remove Liquidity............................ # N/A N/A
Fee to Remove Liquidity............................... N/A # $0.46
Non-Penny Pilot Options:
Rebate to Add Liquidity............................... * N/A N/A
Fee to Add Liquidity.................................. * \5\ $0.50/$0.95 $0.98
Rebate to Remove Liquidity............................ * N/A N/A
Fee to Remove Liquidity............................... N/A * $0.89
----------------------------------------------------------------------------------------------------------------
\1\ A Non-Customer includes a Professional, Firm, Broker-Dealer and Non-BX Options Market Maker.
\2\ The Rebate to Add Liquidity will be paid to a BX Options Market Maker only when the BX Options Market Maker
is contra to a Non-Customer or BX Options Market Maker.
\3\ The Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options Market Maker
is contra to a Customer.
\4\ Reserved
\5\ The higher Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options
Market Maker is contra to a Customer.
# Penny Pilot Options Tier Schedule
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rebate to add Rebate to remove Fee to remove Fee to remove
liquidity Fee to add liquidity liquidity liquidity liquidity
--------------------------------------------------------------------------------------------------------------------------------------------------------
When............................... Customer.............. Customer.............. Customer............. BX Options Market BX Options Market
Maker. Maker.
Trading with....................... Non-Customer or BX Customer.............. Non-Customer, BX Customer............. Non-Customer or BX
Options Market Maker. Options Market Options Market
Maker, or Customer. Maker.
Tier 1:
Participant executes less than $0.00................. $0.39................. $0.00................ $0.39................ $0.46.
0.05% of total industry
customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to $0.10................. $0.39................. $0.25................ $0.39................ $0.46.
less than 0.15% of total
industry customer equity and
ETF option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or $0.20................. $0.39................. $0.35................ $0.30................ $0.46.
more of total industry
customer equity and ETF option
ADV contracts per month.
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 8560]]
* Non-Penny Pilot Options Tier Schedule
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rebate to add Rebate to remove Fee to remove Fee to remove
liquidity Fee to add liquidity liquidity liquidity liquidity
--------------------------------------------------------------------------------------------------------------------------------------------------------
When............................... Customer.............. Customer.............. Customer............. BX Options Market BX Options Market
Maker. Maker.
Trading with....................... Non-Customer or BX Customer.............. Non-Customer, BX Customer............. Non-Customer or BX
Options Market Maker. Options Market Options Market
Maker, or Customer. Maker.
Tier 1:
Participant executes less than $0.00................. $0.85................. $0.80................ $0.89................ $0.89.
0.05% of total industry
customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to $0.10................. $0.85................. $0.80................ $0.89................ $0.89.
less than 0.15% of total
industry customer equity and
ETF option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or $0.20................. $0.85................. $0.80................ $0.60................ $0.89.
more of total industry
customer equity and ETF option
ADV contracts per month.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Change 1--Penny Pilot Options: Modify Fees and Rebates To Add Firm
Column
In Change 1, the Exchange proposes modifications to its fees and
rebates for Penny Pilot Options \9\ and for Non-Penny Pilot Options to
add a new Firm column. The proposed Firm column would have exactly the
same assessments or rates as the current Non-Customer column, which now
includes Firm.\10\ The Exchange notes that by adding the new Firm
column it is not changing any fees and rebates for Firm. Rather, all
fees and rebates applicable to Firm are now in the new Firm column but
remain exactly the same as they are currently for Firm when it is part
of the Non-Customer column. Commensurate with the proposed Firm column,
the Exchange also proposes to change notes 1 and 2 so that these notes
read properly. The Exchange proposes to take out ``Firm'' in note 1 and
to add ``Firm'' in note 2.
---------------------------------------------------------------------------
\9\ The greatest volume options traded on the Exchange and in
the options market are Penny Pilot Options, and in particular SPY
Options, and the Exchange has taken this into account when
structuring and modifying its fee and rebate schedule.
\10\ Currently, note 1 states: ``A Non-Customer includes a
Professional, Firm, Broker-Dealer and Non-BX Options Market Maker.''
---------------------------------------------------------------------------
The proposed change keeps current fees and rebates assessments
intact. Thus, for Penny Pilot Options: The Rebate to Add Liquidity
would remain at N/A for Non-Customer and would be the same for Firm;
the Fee to Add Liquidity would remain at $0.45 for Non-Customer and
would be the same for Firm; the Rebate to Remove Liquidity would remain
at N/A for Non-Customer and would be the same for Firm; and the Fee to
Remove Liquidity would remain at $0.46 for non-Customer and would be
the same for Firm. Thus, for Non-Penny Pilot Options: The Rebate to Add
Liquidity would remain at N/A for Non-Customer and would be the same
for Firm; the Fee to Add Liquidity would remain at $0.98 for non-
Customer and would be the same for Firm; the Rebate to Remove Liquidity
would remain at N/A for Non-Customer and would be the same for Firm;
and the Fee to Add Liquidity would remain at $0.89 for non-Customer and
would be the same for Firm.
Chapter XV, Section 2 subsection (1) reflecting the proposed new
Firm column is set forth below.
Change 2--Penny Pilot Options: Modify Fees and Rebates To Add SPY
Options Tiers
In Change 2, the Exchange proposes modifications to its current
Penny Pilot Options Tier Schedule to indicate that this particular
schedule does not apply to SPY Options and that for SPY Options pricing
there will be a separate SPY Options Tier Schedule. The Exchange
proposes new The Tier 1, Tier 2, and Tier 3 requirements which will be
similar to tiers in the current Penny Pilot Options Tier Schedule; and
a new Tier 4.
Specifically, the Exchange proposes to add SPY Options Tiers 1-4
for Rebate to Add Liquidity for Customer (when trading with Non-
Customer, BX Options Market Maker, or Firm \11\), Fee to Add Liquidity
for BX Market Maker (when trading with Customer), Rebate to Remove
Liquidity for Customer (when trading with Non-Customer, BX Options
Market Maker, Customer, or Firm), and Fee to Remove Liquidity for BX
Options Market Maker (when trading with Customer). The Exchange also
proposes several explanatory notes applicable to the SPY Option Tier
Schedule.
---------------------------------------------------------------------------
\11\ Commensurate with establishing a Firm column, and in
particular indicating Firm in the new SPY Options Tier Schedule, the
Exchange proposes to add Firm in the Non-Penny Pilot Options Tier
Schedule (e.g., Rebate to Add Liquidity, Rebate to Remove Liquidity,
Fee to Remove Liquidity).
---------------------------------------------------------------------------
Proposed Tier 1 in the SPY Options Tier Schedule will be where a BX
Participant (``Participant'') executes less than 0.05% of total
industry customer equity and exchange traded fund (``ETF'') option
average daily volume (``ADV'') contracts per month. Proposed Tier 1
will range from a $0.00 rebate to a $0.42 fee:
--The new Rebate to Add Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, or Firm will be $0.00 (no rebate
will be paid); \12\
---------------------------------------------------------------------------
\12\ The new Rebate to Add Liquidity is similar to what is in
the current Penny Pilot Options Tier Schedule. However, in the new
rebate the Exchange proposes to add that the rebate is also
applicable when trading with Firm, which is proposed to be separate
from Non-Customer. For purposes of conformity, Firm is proposed to
be added to the Rebate to Add Liquidity for Customer in the Penny
Pilot Tier Schedule, the SPY Options Tier Schedule, and the Non-
Penny Pilot Tier Schedule.
---------------------------------------------------------------------------
[[Page 8561]]
--the new Fee to Add Liquidity when BX Options Market Maker trading
with Customer will be $0.42; \13\
---------------------------------------------------------------------------
\13\ There is no similar fee in the current Penny Pilot Options
Tier Schedule.
---------------------------------------------------------------------------
--the new Rebate to Remove Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, Customer, or Firm will be $0.00;
\14\ and
---------------------------------------------------------------------------
\14\ The new Rebate to Remove Liquidity is similar to what is in
the current Penny Pilot Options Tier Schedule. However, in the new
rebate the Exchange proposes to add that the rebate is also
applicable when trading with Firm, which is proposed to be separate
from Non-Customer. For purposes of conformity, Firm is proposed to
be added to the Rebate to Add [sic] Liquidity for Customer in the
Penny Pilot Tier Schedule, the SPY Options Tier Schedule, and the
Non-Penny Pilot Tier Schedule.
---------------------------------------------------------------------------
--the new Fee to Remove Liquidity when BX Options Market Maker trading
with Customer will be $0.42.\15\
---------------------------------------------------------------------------
\15\ The Fee to Remove Liquidity is $0.39 in the current Penny
Pilot Options Tier Schedule. However, in the new rebate the Exchange
proposes to add that the rebate is also applicable when trading with
Firm, which is proposed to be separate from Non-Customer. For
purposes of conformity, Firm is proposed to be added to the Rebate
to Add Liquidity for Customer in the Penny Pilot Tier Schedule, the
SPY Options Tier Schedule, and the Non-Penny Pilot Tier Schedule.
Proposed Tier 2 in the SPY Options Tier Schedule will be where
Participant executes 0.05% to less than 0.15% of total industry
customer equity and ETF option ADV contracts per month. Proposed Tier 2
---------------------------------------------------------------------------
will range from a $0.25 rebate to a $0.42 fee:
--The new Rebate to Add Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, or Firm will be $0.10.\16\
---------------------------------------------------------------------------
\16\ The new Rebate to Add Liquidity is similar to what is in
the current Penny Pilot Options Tier Schedule.
---------------------------------------------------------------------------
--the new Fee to Add Liquidity when BX Options Market Maker trading
with Customer will be $0.42; \17\
---------------------------------------------------------------------------
\17\ There is no similar fee in the current Penny Pilot Options
Tier Schedule.
---------------------------------------------------------------------------
--the new Rebate to Remove Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, Customer, or Firm will be $0.25;
\18\ and
---------------------------------------------------------------------------
\18\ The new Rebate to Remove Liquidity is similar to what is in
the current Penny Pilot Options Tier Schedule.
---------------------------------------------------------------------------
--the new Fee to Remove Liquidity when BX Options Market Maker trading
with Customer will be $0.42.\19\
---------------------------------------------------------------------------
\19\ The Fee to Remove Liquidity is $0.39 in the current Penny
Pilot Options Tier Schedule.
Proposed Tier 3 in the SPY Options Tier Schedule will be where
Participant executes 0.15% or more of total industry customer equity
and ETF option ADV contracts per month. Proposed Tier 3 will range from
---------------------------------------------------------------------------
a $0.37 rebate to a $0.39 fee:
--The new Rebate to Add Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, or Firm will be $0.20.\20\
---------------------------------------------------------------------------
\20\ The Rebate to Add Liquidity is similar to what is in the
current Penny Pilot Options Tier Schedule.
---------------------------------------------------------------------------
--the new Fee to Add Liquidity when BX Options Market Maker trading
with Customer will be $0.39; \21\
---------------------------------------------------------------------------
\21\ There is no similar fee in the current Penny Pilot Options
Tier Schedule.
---------------------------------------------------------------------------
--the new Rebate to Remove Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, Customer, or Firm will be $0.37;
\22\ and
---------------------------------------------------------------------------
\22\ The Rebate to Remove Liquidity is $0.35 in the current
Penny Pilot Options Tier Schedule.
---------------------------------------------------------------------------
--the new Fee to Remove Liquidity when BX Options Market Maker trading
with Customer will be $0.39.\23\
---------------------------------------------------------------------------
\23\ The Fee to Remove Liquidity is $0.30 in the current Penny
Pilot Options Tier Schedule.
Proposed Tier 4 in the SPY Options Tier Schedule, which has no
equivalent in the Penny Pilot Options Tier Schedule, will be where
Participant executes greater than 5,000 ADV in BX Price Improvement
Auction (``PRISM'') Agency Contracts.\24\ If a Participant qualifies
for Tier 4 the rates applicable to this tier will supersede any other
SPY tier rates that the Participant may that [sic] qualify for.
Proposed Tier 4 will range from a $0.37 rebate to a $0.32 fee:
---------------------------------------------------------------------------
\24\ PRISM is a Price Improvement Mechanism for all-electronic
BX Options whereby a buy and sell order may be submitted in one
order message to initiate an auction at a stop price and seek
potential price improvement. Options are traded electronically on BX
Options, and all options participants may respond to a PRISM
Auction, the duration of which is set at 200 milliseconds. PRISM
includes auto-match functionality in which a Participant (an
``Initiating Participant'') may electronically submit for execution
an order it represents as agent on behalf of customer, n6 [sic]
broker dealer, or any other entity (``PRISM Order'') against
principal interest or against any other order it represents as agent
(an ``Initiating Order'') provided it submits the PRISM Order for
electronic execution into the PRISM Auction pursuant [sic]. See
Chapter VI, Section 9; and Securities Exchange Act Release No. 76301
(October 29, 2015), 80 FR 68347 (November 4, 2015) (SR-BX-2015-032)
(order approving BX PRISM).
--The new Rebate to Add Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, or Firm will be $0.25.
--the new Fee to Add Liquidity when BX Options Market Maker trading
with Customer will be $0.32;
--the new Rebate to Remove Liquidity when Customer trading with Non-
Customer, BX Options Market Maker, Customer, or Firm will be $0.37; and
--the new Fee to Remove Liquidity when BX Options Market Maker trading
with Customer will be $0.25.
In addition, the Exchange proposes several explanatory notes at the
end of the SPY Options Tier Schedule:
--BX Options Market Maker fee to add liquidity in SPY Options will be
$0.00 when trading with Firm, Non-Customer, or BX Options Market Maker;
--Firm fee to add liquidity and fee to remove liquidity in SPY Options
will be $0.33 per contract, regardless of counterparty;
--Non-Customer fee to add liquidity and fee to remove liquidity in SPY
Options will be $0.46 per contract, regardless of counterparty;
--BX Options Market Maker fee to remove liquidity in SPY Options will
be $0.46 per contract when trading with Firm, Non-Customer, or BX
Options Market Maker;
--Customer fee to add liquidity in SPY Options when contra to another
Customer is $0.33 per contract; and
--Volume from all products listed on BX Options will apply to the SPY
Options Tiers. Chapter XV, Section 2 subsection (1) reflecting all
proposed changes will read as follows:
(1) Fees for Execution of Contracts on the BX Options Market:
Fees and Rebates
[Per executed contract]
----------------------------------------------------------------------------------------------------------------
BX Options Non-Customer
Customer Market Maker \1\ Firm
----------------------------------------------------------------------------------------------------------------
Penny Pilot Options (Excluding Options in SPY):
Rebate to Add Liquidity..................... # \2\ $0.10 N/A N/A
Fee to Add Liquidity........................ # \3\ $0.39 $0.45 $0.45
Rebate to Remove Liquidity.................. # N/A N/A N/A
[[Page 8562]]
Fee to Remove Liquidity..................... N/A # $0.46 $0.46
Non-Penny Pilot Options:
Rebate to Add Liquidity..................... * N/A N/A N/A
Fee to Add Liquidity........................ * \5\ $0.50/ $0.98 $0.98
$0.95
Rebate to Remove Liquidity.................. * N/A N/A N/A
Fee to Remove Liquidity..................... N/A * $0.89 $0.89
----------------------------------------------------------------------------------------------------------------
\1\ A Non-Customer includes a Professional, Broker-Dealer and Non-BX Options Market Maker.
\2\ The Rebate to Add Liquidity will be paid to a BX Options Market Maker only when the BX Option Market Maker
is contra to a Non-Customer, Firm, or BX Options Market Maker.
\3\ The Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options Market Maker
is contra to a Customer.
\4\ Reserved.
\5\ The higher Fee to Add Liquidity will be assessed to a BX Options Market Maker only when the BX Options
Market Maker is contra to a Customer.
# Penny Pilot Options Tier Schedule
[Excluding SPY Options]
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rebate to add Rebate to remove Fee to remove Fee to remove
liquidity Fee to add liquidity liquidity liquidity liquidity
--------------------------------------------------------------------------------------------------------------------------------------------------------
When: Customer.............. Customer.............. Customer............. BX Options Market BX Options Market
Maker. Maker.
Trading with: Non-Customer, BX Customer.............. Non-Customer, BX Customer............. Non-Customer, BX
Options Market Maker, Options Market Options Market
or Firm. Maker, Customer, or Maker, or Firm.
Firm.
Tier 1:
Participant executes less than $0.00................. $0.39................. $0.00................ $0.39................ $0.46.
0.05% of total industry
customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to $0.10................. $0.39................. $0.25................ $0.39................ $0.46.
less than 0.15% of total
industry customer equity and
ETF option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or $0.20................. $0.39................. $0.35................ $0.30................ $0.46.
more of total industry
customer equity and ETF option
ADV contracts per month.
--------------------------------------------------------------------------------------------------------------------------------------------------------
SPY Options Tier Schedule
----------------------------------------------------------------------------------------------------------------
Rebate to add Fee to add Rebate to remove Fee to remove
liquidity liquidity liquidity liquidity
----------------------------------------------------------------------------------------------------------------
When: Customer.......... BX Options Market Customer.......... BX Options Market
Maker. Maker.
Trading with: Non-Customer, BX Customer.......... Non-Customer, BX Customer.
Options Market Options Market
Maker, or Firm. Maker, Customer,
or Firm.
Tier 1:
Participant executes less $0.00............. $0.42............. $0.00............. $0.42.
than 0.05% of total
industry customer equity
and ETF option ADV
contracts per month.
Tier 2:
Participant executes 0.05% $0.10............. $0.42............. $0.25............. $0.42.
to less than 0.15% of total
industry customer equity
and ETF option ADV
contracts per month.
Tier 3:
Participant executes 0.15% $0.20............. $0.39............. $0.37............. $0.39.
or more of total industry
customer equity and ETF
option ADV contracts per
month.
[[Page 8563]]
Tier 4:
Participant executes greater $0.25............. $0.32............. $0.37............. $0.25.
than 5,000 ADV in PRISM
Agency Contracts.
----------------------------------------------------------------------------------------------------------------
BX Options Market Maker fee to add liquidity in SPY Options will be $0.00 when trading with Firm, Non-
Customer, or BX Options Market Maker.
Firm fee to add liquidity and fee to remove liquidity in SPY Options will be $0.33 per contract,
regardless of counterparty.
Non-Customer fee to add liquidity and fee to remove liquidity in SPY Options will be $0.46 per
contract, regardless of counterparty.
BX Options Market Maker fee to remove liquidity in SPY Options will be $0.46 per contract when trading
with Firm, Non-Customer, or BX Options Market Maker.
Customer fee to add liquidity in SPY Options when contra to another Customer is $0.33 per contract.
Volume from all products listed on BX Options will apply to the SPY Options Tiers.
* Non-Penny Pilot Options Tier Schedule
--------------------------------------------------------------------------------------------------------------------------------------------------------
Rebate to add Rebate to remove Fee to remove Fee to remove
liquidity Fee to add liquidity liquidity liquidity liquidity
--------------------------------------------------------------------------------------------------------------------------------------------------------
When: Customer.............. Customer.............. Customer............. BX Options Market BX Options Market
Maker. Maker.
Trading with: Non-Customer, BX Customer.............. Non-Customer, BX Customer............. Non-Customer, BX
Options Market Maker, Options Market Options Market
or Firm. Maker, Customer, or Maker, or Firm.
Firm.
Tier 1:
Participant executes less than $0.00................. $0.85................. $0.80................ $0.89................ $0.89.
0.05% of total industry
customer equity and ETF option
ADV contracts per month.
Tier 2:
Participant executes 0.05% to $0.10................. $0.85................. $0.80................ $0.89................ $0.89.
less than 0.15% of total
industry customer equity and
ETF option ADV contracts per
month.
Tier 3:
Participant executes 0.15% or $0.20................. $0.85................. $0.80................ $0.60................ $0.89.
more of total industry
customer equity and ETF option
ADV contracts per month.
--------------------------------------------------------------------------------------------------------------------------------------------------------
The Exchange is proposing fees and rebate changes and adopting the
SPY Options Tier Schedule at this time because it believes that this
will provide incentives for execution of contracts, and in particular
SPY Options contracts, on the BX Options Market.
The Exchange also believes that its proposal should provide
increased opportunities for participation in executions on the
Exchange, facilitating the ability of the Exchange to bring together
participants and encourage more robust competition for orders.
2. Statutory Basis
The Exchange believes that its proposal to amend its Pricing
Schedule is consistent with Section 6(b) of the Act,\25\ in general,
and furthers the objectives of Section 6(b)(4) and (b)(5) of the
Act,\26\ in particular, in that it provides for the equitable
allocation of reasonable dues, fees and other charges among members and
issuers and other persons using any facility or system which the
Exchange operates or controls, and is not designed to permit unfair
discrimination between customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------
\25\ 15 U.S.C. 78f(b).
\26\ 15 U.S.C. 78f(b)(4), (5).
---------------------------------------------------------------------------
The Commission and the courts have repeatedly expressed their
preference for competition over regulatory intervention in determining
prices, products, and services in the securities markets. In Regulation
NMS, while adopting a series of steps to improve the current market
model, the Commission highlighted the importance of market forces in
determining prices and SRO revenues* [sic] and, also, recognized that
current regulation of the market system ``has been remarkably
successful in promoting market competition in its broader forms that
are most important to investors and listed companies.'' \27\ Likewise,
in NetCoalition v. Securities and Exchange Commission \28\
(``NetCoalition'') the D.C. Circuit upheld the Commission's use of a
market-based approach in evaluating the fairness of market data fees
against a challenge claiming that Congress mandated a cost-based
approach.\29\ As the court emphasized, the Commission ``intended in
Regulation NMS that `market forces, rather than regulatory
requirements' play a role in determining the market data . . . to be
made available to investors and at what cost.'' \30\
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\27\ Securities Exchange Act Release No. 51808 at 37499 (June 9,
2005) (``Regulation NMS Adopting Release'').
\28\ NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010).
\29\ See id. at 534-535.
\30\ See id. at 537.
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Further, ``[n]o one disputes that competition for order flow is
`fierce.' . . . As the SEC explained, `[i]n the U.S. national market
system, buyers and sellers of securities, and the broker-dealers that
act as their order-routing agents, have a wide range of choices of
where to route orders for execution';
[[Page 8564]]
[and] `no exchange can afford to take its market share percentages for
granted' because `no exchange possesses a monopoly, regulatory or
otherwise, in the execution of order flow from broker dealers'. . . .''
\31\ Although the court and the SEC were discussing the cash equities
markets, the Exchange believes that these views apply with equal force
to the options markets.
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\31\ Id. at 539 (quoting Securities Exchange [sic] Release No.
59039 (December 2, 2008), 73 FR 74770 (December 9, 2008) (SR-
NYSEArca-2006-21) at 73 FR at 74782-74783).
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The Exchange proposes to amend its Chapter XV, Section 2 to modify
subsection (1) to adopt fees and rebates applicable to Firm, and to
adopt a new SPY Option Tier Schedule. The proposed modified fees and
rebates and new SPY Option Tier Schedule would, as discussed, apply to
Customers, BX Options Market Makers, Non-Customers, and Firms. The
Exchange believes that its proposal is reasonable, equitable, and not
unfairly discriminatory and should provide increased opportunities for
participation in executions on the Exchange, facilitating the ability
of the Exchange to bring together participants and encourage more
robust competition for orders.
Change 1--Penny Pilot Options: Modify Fees and Rebates To Add Firm
Column
In Change 1, the Exchange proposes modifications to its fees and
rebates for Penny Pilot Options and for Non-Penny Pilot Options to add
a new Firm column; and to make changes to notes to properly reflect the
use of the new Firm column. The proposed Firm column would have exactly
the same assessments or rates as the current Non-Customer column, which
now includes Firm.
The proposed change is reasonable because it simply establishes a
new Firm column but keeps current fees and rebate assessments intact.
The proposed rule change is reasonable because it continues to
encourage market participant behavior through the fees and rebates
system, which is an accepted methodology among options exchanges.\32\
The proposed change is also reasonable because it continues, through
the fees and rebates schedule, to incentivize Participants to direct
Penny Pilot Options liquidity\33\ and Non-Penny Pilot Options liquidity
to the Exchange.
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\32\ See, e.g., fee and rebate schedules of other options
exchanges, including, but not limited to, NASDAQ Options Market
(``NOM''), NASDAQ PHLX LLC (``Phlx''), and Chicago Board Options
Exchange (``CBOE'').
\33\ Penny Pilot Options, and in particular SPY Options,
represent the greatest volume options traded on the Exchange and in
the options market and the Exchange has taken this into account when
structuring and modifying its fee and rebate schedule.
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The proposed rule change to fees and rebates for Penny Pilot
Options and for Non-Penny Pilot Options to add a new Firm column, and
to make changes to notes to properly reflect the use of the new Firm
column, is equitable and not unfairly discriminatory. This is because
the Exchange's proposal keeps current fees and rebate assessments
intact, and the fees and rebates schedule will continue to apply
uniformly to all similarly situated Participants.
The fees and rebates schedule as proposed continues to reflect
differentiation among different market participants. The Exchange
believes that the differentiation is equitable and not unfairly
discriminatory, as well as reasonable, and notes that some market
participants like BX Options Market Makers commit to various
obligations. For example, transactions of a BX Options Market Maker
must constitute a course of dealings reasonably calculated to
contribute to the maintenance of a fair and orderly market, and BX
Options Market Makers should not make bids or offers or enter into
transactions that are inconsistent with such course of dealings.
Further, all BX Options Market Makers are designated as specialists on
BX for all purposes under the Act or rules thereunder.\34\
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\34\ See Chapter VII, Section 5, entitled ``Obligations of
Market Makers.''
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The Exchange believes that by making the proposed Firm column
change, it is continuing to incentivize Participants to execute more
volume on the Exchange to further enhance liquidity in this market.
Change 2--Penny Pilot Options: Modify Fees and Rebates To Add SPY
Options Tiers
In Change 2, the Exchange proposes modifications to its current
Penny Pilot Options Tier Schedule to indicate that this particular
schedule does not apply to SPY Options, and that for SPY Options
pricing there will be a separate SPY Options Tier Schedule. The Tier 1,
Tier 2, and Tier 3 requirements in the proposed SPY Options Tier
Schedule will be similar to the current Penny Pilot Options Tier
Schedule. The Exchange also proposes a new Tier 4 for the SPY Options
Tier Schedule. Specifically, the Exchange proposes to add SPY Options
Tiers 1-4 for Rebate to Add Liquidity for Customer (when trading with
Non-Customer, BX Options Market Maker, or Firm), Fee to Add Liquidity
for BX Market Maker (when trading with Customer), Rebate to Remove
Liquidity for Customer (when trading with Non-Customer, BX Options
Market Maker, Customer, or Firm), and Fee to Remove Liquidity or [sic]
BX Options Market Maker (when trading with Customer). The Exchange also
proposes several explanatory notes applicable to the SPY Option Tier
Schedule.
The Exchange believes that excluding SPY Options pricing form the
Penny Pilot Options Tier Schedule and establishing a separate SPY
Options Tier Schedule is reasonable because of the nature of SPY
options. These are most heavily traded options on the Exchange as well
as in the industry.
The Exchange believes that the proposed SPY Options Tier Schedule
is reasonable because it is not a novel, untested structure but rather
is similar to what is offered by other options markets,\35\ and, is
based on the Exchange's Penny Pilot Options Tier Schedule. The proposed
Tiers in the SPY Options Tier Schedule clearly reflect the
progressively increasing nature of Participant executions structured
for the purpose of attracting order flow to the Exchange. This
encourages market participant behavior through progressive tiered fees
and rebates using an accepted methodology among options exchanges.\36\
Tier 1 in the SPY Options Tier Schedule is, similarly to Tier 1 in the
Penny Pilot Options Tier Schedule, set up to enable a Participant to
earn a Rebate to Add Liquidity or pay a Fee to Add Liquidity in SPY
where the Participant executes less than 0.05% of total industry
customer equity and ETF option ADV contracts per month. Tier 2 in the
SPY Options Tier Schedule is, similarly to Tier 2 in the Penny Pilot
Options Tier Schedule, set up to enable a Participant to earn a Rebate
to Add Liquidity or pay a Fee to Add Liquidity in SPY where the
Participant executes 0.05% to less than 0.15% of total industry
customer equity and ETF option ADV contracts per month. And Tier 3 in
the SPY Options Tier Schedule is, similarly to Tier 3 in the Penny
Pilot Options Tier Schedule, set up to [sic] Participant executes 0.15%
or more of total industry customer equity and ETF option ADV contracts
per month. The fees and rebates that BX Options Market Makers and
Customers are assessed are, as has been discussed at length, comparable
to
[[Page 8565]]
the fees and rebates in the Penny Pilot Options Tier Schedule. The
Exchange believes that it is reasonable to also establish Tier 4 in the
in the [sic] SPY Options Tier Schedule in order to enable a Participant
to earn a Rebate to Add Liquidity or pay a Fee to Add Liquidity in SPY
where the Participant executes greater than 5,000 ADV in certain PRISM
Contracts. By so doing, the Exchange encourages Participants to trade
Prism Contracts, which have been recently approved for trading.\37\
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\35\ See, e.g., the pricing schedule of Phlx. See also, e.g.,
the pricing schedule of NASDAQ Options Market (``NOM'').
\36\ See, e.g., fee and rebate schedules of other options
exchanges, including, but not limited to, NOM, Phlx, and Chicago
Board Options Exchange (``CBOE'').
\37\ See Securities Exchange Act Release No. 76301 (October 29,
2015), 80 FR 68347 (November 4, 2015) (SR-BX-2015-032) (order
approving BX PRISM).
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In addition, the Exchange believes that making changes to add the
SPY Options Tier Schedule in terms of Rebate to Add Liquidity and Fee
to Add Liquidity, and Rebate to Remove Liquidity and Fee to Remove
Liquidity, is reasonable because it encourages the desired Customer
behavior by attracting Customer interest to the Exchange. Customer
activity enhances liquidity on the Exchange for the benefit of all
market participants and 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.
The SPY Options Tier Schedule is reasonable in that it is, like the
Penny Pilot Options Tier Schedule, set up to incentivize Participants
to direct liquidity to the Exchange; using volume from all products
listed on BX Options will further incentivize Participants. As
Participants execute more of total industry customer equity and ETF
option ADV contracts per month on the Exchange, they can in certain
categories earn higher rebates and be assessed lower fees. For example,
in the SPY Options Tier Schedule the Tier 3 Rebate to Add Liquidity
when Customer trading with Non-Customer, BX Options Market Maker, or
Firm is higher ($0.20) than the Penny Pilot [sic] Tier 1 Rebate to Add
Liquidity ($0.00); and the Tier 3 Rebate to Remove Liquidity when
Customer trading with Non-Customer, BX Options Market Maker, Customer,
or Firm is higher ($0.37) that [sic] the Tier 2 Rebate to Remove
Liquidity ($0.25). Similarly, the Fee to Add Liquidity when BX Option
Market Maker trading with Customer is lesser for Tier 3 ($0.39) than
for Tier 1 ($0.42); and the Fee to Remove Liquidity when BX Option
Market Maker trading with Customer is less for Tier 3 ($0.39) than for
Tier 1 ($0.42).
The Exchange believes that it is reasonable to add notes to the SPY
Options Tier Schedule as they are explanatory in nature. Five such
notes explain that unlike how new Tiers 1-4 function, certain fees
(e.g. BX Options Market Maker, Firm, Non-Customer, and Customer) remain
the same regardless of counterparty. The Exchanges believes that it is
also reasonable for conformity to indicate Firm across fees and
rebates, the new SPY Options Tier Schedule, the Penny Pilot Options
Tier Schedule, and the Non-Penny Pilot Options Tier Schedule.
Establishing the SPY Options Tier Schedule, which includes new
Tiers 1-4, is equitable and not unfairly discriminatory. This is
because the Exchange's proposal to assess fees and pay rebates
according to Tiers 1, 2, 3, and 4 will apply uniformly to all similarly
situated Participants. Customers would earn a Rebate to Add Liquidity
and be assessed a Fee to Add Liquidity according to the Tiers, and BX
Market Makers would earn a Rebate to Remove Liquidity [sic] and a Fee
to Remove Liquidity according to the same Tiers per the SPY Options
Tier Schedule; and certain fees would be the same regardless of
counterparty. The fee and rebate schedule as proposed continues to
reflect differentiation among different market participants. The
Exchange believes that the differentiation is equitable and not
unfairly discriminatory, as well as reasonable, because some market
participants like BX Options Market Makers commit to obligations such
as that transactions must constitute a course of dealings reasonably
calculated to contribute to the maintenance of a fair and orderly
market, and BX Options Market Makers should not make bids or offers or
enter into transactions that are inconsistent with such course of
dealings.
The Exchange believes that by making the proposed Penny Pilot
Options changes it is incentivizing Participants to execute more volume
on the Exchange to further enhance liquidity in this market.
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. Specifically, the Exchange does
not believe that its proposal to make changes to its Penny Pilot
Options and Non-Penny Pilot Options fees and rebates and to establish a
SPY Options Tiers Schedule will impose any undue burden on competition,
as discussed below.
The Exchange operates in a highly competitive market in which many
sophisticated and knowledgeable market participants can readily and do
send order flow to competing exchanges if they deem fee levels or
rebate incentives at a particular exchange to be excessive or
inadequate. Additionally, new competitors have entered the market and
still others are reportedly entering the market shortly. These market
forces ensure that the Exchange's fees and rebates remain competitive
with the fee structures at other trading platforms. In that sense, the
Exchange's proposal is actually pro-competitive because the Exchange is
simply continuing its fees and rebates and [sic] for Penny Pilot
Options and Non-Penny Pilot Options and establishing a SPY Options
Tiers Schedule in order to remain competitive in the current
environment.
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. In terms of inter-market
competition, the Exchange notes that it operates in a highly
competitive market in which market participants can readily favor
competing venues if they deem fee levels at a particular venue to be
excessive, or rebate opportunities available at other venues to be more
favorable. In such an environment, the Exchange must continually adjust
its fees to remain competitive with other exchanges and with
alternative trading systems that have been exempted from compliance
with the statutory standards applicable to exchanges. Because
competitors are free to modify their own fees in response, and because
market participants may readily adjust their order routing practices,
the Exchange believes that the degree to which fee changes in this
market may impose any burden on competition is extremely limited. In
terms of intra-market competition, the Exchange notes that price
differentiation among different market participants operating on the
Exchange (e.g., Customer and BX Options Market Maker) is reasonable.
Customer activity, for example, enhances liquidity on the Exchange for
the benefit of all market participants and benefits all market
participants by providing more trading opportunities, which attracts
market makers. An increase in the activity of these market participants
(particularly in response to pricing) in turn facilitates tighter
spreads, which may cause an additional
[[Page 8566]]
corresponding increase in order flow from other market participants.
Moreover, unlike others market participants each BX Options Market
Maker commits to various obligations. These obligations include, for
example, transactions of a BX Market Maker must constitute a course of
dealings reasonably calculated to contribute to the maintenance of a
fair and orderly market, and Market Makers should not make bids or
offers or enter into transactions that are inconsistent with such
course of dealings.\38\
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\38\ See Chapter VII, Section 5, entitled ``Obligations of
Market Makers''.
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In this instance, the proposed changes to the fees and rebates for
Penny Pilot Options and for Non-Penny Pilot Options to add a new Firm
column, and establishing a SPY Options Tiers Schedule, do not impose a
burden on competition because the Exchange's execution and routing
services are completely voluntary and subject to extensive competition
both from other exchanges and from off-exchange venues. If the changes
proposed herein are unattractive to market participants, it is likely
that the Exchange will lose market share as a result. Accordingly, the
Exchange does not believe that the proposed changes will impair the
ability of members or competing order execution venues to maintain
their competitive standing in the financial markets. Additionally, the
changes proposed herein are pro-competitive to the extent that they
continue to allow the Exchange to promote and maintain order
executions.
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
Pursuant to Section 19(b)(3)(A)(ii) of the Act,\39\ the Exchange
has designated this proposal as establishing or changing a due, fee, or
other charge imposed by the self-regulatory organization on any person,
whether or not the person is a member of the self-regulatory
organization, which renders the proposed rule change effective upon
filing.
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\39\ 15 U.S.C. 78s(b)(3)(A)(ii).
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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: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) 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-BX-2016-010 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-BX-2016-010. 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-BX-2016-010 and should be
submitted on or before March 11, 2016.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\40\
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\40\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-03392 Filed 2-18-16; 8:45 am]
BILLING CODE 8011-01-P
