Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fee Schedule on the BOX Market LLC (“BOX”) Options Facility, 22133-22136 [2016-08559]
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Federal Register / Vol. 81, No. 72 / Thursday, April 14, 2016 / Notices
SECURITIES AND EXCHANGE
COMMISSION
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mstockstill on DSK4VPTVN1PROD with NOTICES
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Dated: April 8, 2016.
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–08550 Filed 4–13–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–77572; File No. SR–BOX–
2016–14]
Self-Regulatory Organizations; BOX
Options Exchange LLC; Notice of
Filing and Immediate Effectiveness of
a Proposed Rule Change To Amend
the Fee Schedule on the BOX Market
LLC (‘‘BOX’’) Options Facility
April 8, 2016.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on March 31,
2016, BOX Options Exchange LLC (the
‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
prepared by the Exchange. The
Exchange filed the proposed rule change
pursuant to Section 19(b)(3)(A)(ii) of the
Act,3 and Rule 19b–4(f)(2) thereunder,4
which renders the proposal effective
upon filing with the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
The Exchange is filing with the
Securities and Exchange Commission
(‘‘Commission’’) a proposed rule change
to amend the Fee Schedule to revise
certain qualification thresholds and fees
in Section I.B. of the BOX Fee Schedule
on the BOX Market LLC (‘‘BOX’’)
options facility. While changes to the
fee schedule pursuant to this proposal
will be effective upon filing, the changes
will become operative on April 1, 2016.
The text of the proposed rule change is
available from the principal office of the
Exchange, at the Commission’s Public
Reference Room and also on the
Exchange’s Internet Web site at https://
boxexchange.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in Sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend the
Fee Schedule for trading on BOX.
Specifically, the Exchange proposes to
revise certain qualification thresholds
and fees in Section I.B. of the BOX Fee
Schedule, the Tiered Fee Schedule for
Initiating Participants and BOX Volume
Rebate (‘‘BVR’’).
Under the Tiered Fee Schedule for
Initiating Participants, the Exchange
assesses a per contract execution fee to
all Primary Improvement Order
executions initiated by the particular
Initiating Participant. Percentage
thresholds are calculated on a monthly
basis by totaling the Initiating
Participant’s Primary Improvement
Order volume submitted to BOX,
relative to the total national Customer
volume in multiply-listed options
classes. The current tiered fee schedule
for Initiating Participants is as follows:
Tier
Percentage thresholds of national customer volume in multiply-listed options classes
(monthly)
1 .....................................
0.000%–0.079% ......................................................................................................................................
1 15
2 17
U.S.C. 78s(b)(1).
CFR 240.19b–4.
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3 15
4 17
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U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
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Per contract
fee
(all account
types)
$0.25
22134
Federal Register / Vol. 81, No. 72 / Thursday, April 14, 2016 / Notices
2
3
4
5
.....................................
.....................................
.....................................
.....................................
0.080%–0.159% ......................................................................................................................................
0.160%–0.339% ......................................................................................................................................
0.340%–0.849% ......................................................................................................................................
0.850% and Above ..................................................................................................................................
The Exchange proposes to adjust the
percentage thresholds in Tiers 3 through
5. Additionally, the Exchange proposes
to raise the fee associated with Tier 5
from $0.03 to $0.05. The new Tiered Fee
Schedule for Initiating Participants set
.....................................
.....................................
.....................................
.....................................
.....................................
Per contract
fee
(all account
types)
0.000%–0.079% ......................................................................................................................................
0.080%–0.159% ......................................................................................................................................
0.160%–0.499% ......................................................................................................................................
0.500%–0.999% ......................................................................................................................................
1.000% and Above ..................................................................................................................................
Next, the Exchange proposes to revise
certain qualification thresholds in the
BVR. Under the current BVR, the
Exchange offers a tiered per contract
rebate for all PIP Orders and COPIP
orders of 100 contracts and under.
Percentage thresholds are calculated on
a monthly basis by totaling the
Participant’s PIP and COPIP volume
submitted to BOX, relative to the total
Per contract rebate
(all account types)
PIP
1
2
3
4
................................
................................
................................
................................
0.000%
0.160%
0.340%
0.850%
to 0.159% ............................................................................................................
to 0.339% ............................................................................................................
to 0.849% ............................................................................................................
and Above ...........................................................................................................
The Exchange proposes to adjust the
BVR percentage threshold for Tier 3 to
‘‘0.340% to 0.99%’’ and Tier 4 to
‘‘1.00% and Above.’’ The quantity
submitted will continue to be calculated
on a monthly basis by totaling the
Participant’s PIP and COPIP volume
submitted to BOX, relative to the total
national Customer volume in multiplylisted options classes.
($0.00)
($0.04)
($0.11)
($0.14)
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................................
................................
................................
................................
0.000% to 0.159% ............................................................................................................
0.160% to 0.339% ............................................................................................................
0.340% to 0.99% ..............................................................................................................
1.00% and Above .............................................................................................................
Lastly, the Exchange is proposing to
remove reference and information
relating to Mini Options, as the
Exchange no longer lists or trades Mini
Options and has no current plans to do
so.
The Exchange added rules relating to
the listing of Mini Options (options
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17:56 Apr 13, 2016
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($0.00)
($0.02)
($0.04)
($0.06)
Per contract rebate
(all account types)
PIP
1
2
3
4
COPIP
The new BVR set forth in Section
I.B.2 of the BOX Fee Schedule will be
as follows:
Percentage thresholds of national customer volume in multiply-listed options classes
(monthly)
Tier
$0.25
0.20
0.12
0.07
0.05
national Customer volume in multiplylisted options classes.
The current per contract rebate for
Participants in PIP and COPIP
Transactions under the BVR is:
Percentage thresholds of national customer volume in multiply-listed options classes
(monthly)
Tier
0.20
0.12
0.07
0.03
forth in Section I.B.1. of the BOX Fee
Schedule will be as follows:
Percentage thresholds of national customer volume in multiply-listed options classes
(monthly)
Tier
1
2
3
4
5
Per contract
fee
(all account
types)
Percentage thresholds of national customer volume in multiply-listed options classes
(monthly)
Tier
($0.00)
($0.04)
($0.11)
($0.14)
COPIP
($0.00)
($0.02)
($0.04)
($0.06)
overlying 10 shares of stock) in 2013 5
and later changed its Fee Schedule to
address the treatment of Mini Options,
including establishing transactions fees
for these products.6 However, the
Exchange no longer lists or trades Mini
Option series, and has no current plans
to do so and proposes to strip
references, and charges related to, Mini
Options from the Fee Schedule.
5 See Securities Exchange Act Release No. 68771
(January 30, 2013), 78 FR 8208 (February 5, 2013)
(Notice of Filing and Immediate Effectiveness SR–
BOX–2013–07).
6 See Securities Exchange Act Release No. 69202
(March 21, 2013), 78 FR 18642 (March 27, 2013)
(Notice of Filing and Immediate Effectiveness SR–
BOX–2013–15).
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2. Statutory Basis
The Exchange believes that the
proposal is consistent with the
requirements of Section 6(b) of the Act,
in general, and Section 6(b)(4) and
6(b)(5) of the Act,7 in particular, in that
it provides for the equitable allocation
of reasonable dues, fees, and other
charges among BOX Participants and
other persons using its facilities and
does not unfairly discriminate between
customers, issuers, brokers or dealers.
The Exchange believes the proposed
amendments to the Tiered Fee Schedule
for Initiating Participants in Section
I.B.1. of the BOX Fee Schedule are
reasonable, equitable and nondiscriminatory. The reduced fees related
to trading activity in BOX Auction
Transactions are available to all BOX
Options Participants that initiate
Auction Transactions, and they may
choose whether or not to trade on BOX
to take advantage of the discounted fees
for doing so. The Exchange also believes
adjusting certain percentage thresholds
within the tiers and a fee associated
with a tier is reasonable and
appropriate, as this Tiered Fee Schedule
is in place to provide incentives to BOX
Participants to submit their customer
order into the PIP for potential price
improvement. Further, the Exchange
believes the proposed thresholds and
fees remain competitive when compared
to the auction transaction fees on other
exchanges.8
The Exchange also believes the
proposed amendments to the BVR in
Section I.B of the BOX Fee Schedule are
reasonable, equitable and nondiscriminatory. The BVR was adopted to
attract Public Customer order flow to
the Exchange by offering these
Participants incentives to submit their
PIP and COPIP Orders to the Exchange
and the Exchange believes it is
appropriate to now amend the BVR. The
Exchange believes it is equitable and not
unfairly discriminatory to amend the
BVR, as all Participants have the ability
to qualify for a rebate, and rebates are
provided equally to qualifying
Participants. Finally, the Exchange
believes it is reasonable and appropriate
to continue to provide incentives for
Public Customers, which will result in
greater liquidity and ultimately benefit
all Participants trading on the Exchange.
BOX believes it is reasonable,
equitable and not unfairly
7 15
U.S.C. 78f(b)(4) and (5).
fees at other exchanges range from
$0.05 to $0.30. See Section IV of the Phlx Pricing
Schedule entitled ‘‘PIXL Pricing’’; International
Securities Exchange (‘‘ISE’’) Schedule of Fees,
Section I. Regular Order Fees and Rebates ‘‘Select
Symbols.’’
discriminatory to adjust the monthly
Percentage Thresholds of National
Customer Volume in Multiply-Listed
Options Classes. The volume thresholds
and applicable rebates are meant to
incentivize Participants to direct order
flow to the Exchange to obtain the
benefit of the rebate, which will in turn
benefit all market participants by
increasing liquidity on the Exchange.
Other exchanges employ similar
incentive programs; 9 and the Exchange
believes that the proposed changes to
the volume thresholds and rebates are
reasonable and competitive when
compared to incentive structures at
other exchanges.
Lastly, the Exchange believes the
proposed change to remove references
and information relating to Mini
Options from the Fee Schedule is
reasonable, equitable, and not unfairly
discriminatory, as the Exchange no
longer lists or trades Mini-option series
and has no intention to do so at this
time. Thus, removing outmoded
references on the Fee Schedule would
alleviate potential investor confusion
and improve the clarity and
transparency of the Fee Schedule. The
proposed change is also reasonable,
equitable, and not unfairly
discriminatory as it applies to all market
participants.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act. The
Exchange is simply proposing to revise
certain qualification thresholds and fees
in the Section I.B. of the BOX Fee
Schedule. The Exchange believes that
the volume based rebates and fees
increase intermarket and intramarket
competition by incenting Participants to
direct their order flow to the exchange,
which benefits all participants by
providing more trading opportunities
and improves competition on the
Exchange. The Exchange also believes
the removal of references to Mini
Options will not impose any burden on
competition but will serve to promote
regulatory clarity and consistency,
thereby reducing burdens on the
marketplace and facilitating investor
protection.
8 Comparative
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17:56 Apr 13, 2016
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9 See Section B of the PHLX Pricing Schedule
entitled ‘‘Customer Rebate Program;’’ ISE Gemini’s
Qualifying Tier Thresholds (page 6 of the ISE
Gemini Fee Schedule); and CBOE’s Volume
Incentive Program (VIP).
PO 00000
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22135
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Exchange Act 10
and Rule 19b–4(f)(2) thereunder,11
because it establishes or changes a due,
or fee.
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend the rule change if
it appears to the Commission that the
action is necessary or appropriate in the
public interest, for the protection of
investors, or would otherwise further
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
BOX–2016–14 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BOX–2016–14. 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
10 15
11 17
E:\FR\FM\14APN1.SGM
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
14APN1
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Federal Register / Vol. 81, No. 72 / Thursday, April 14, 2016 / Notices
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–BOX–
2016–14, and should be submitted on or
before May 5, 2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.12
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–08559 Filed 4–13–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–77571; File No. SR–
NYSEArca–2016–28]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Designation of a
Longer Period for Commission Action
on a Proposed Rule Change, as
Modified by Amendment No. 1, To List
and Trade of Shares of RiverFront
Dynamic US Dividend Advantage ETF
and RiverFront Dynamic US Flex-Cap
ETF Under NYSE Arca Equities Rule
8.600
Register on February 25, 2016.3 On
April 7, 2016, the Exchange submitted
Amendment No. 1 to the proposed rule
change.4 The Commission received no
comment letters on the proposed rule
change.
Section 19(b)(2) of the Act 5 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
proceedings to determine whether the
proposed rule change should be
disapproved. The Commission is
extending this 45-day time period.
The Commission finds that it is
appropriate to designate a longer period
within which to take action on the
proposed rule change so that it has
sufficient time to consider the proposed
rule change. Accordingly, the
Commission, pursuant to Section
19(b)(2) of the Act,6 designates May 25,
2016, as the date by which the
Commission should either approve or
disapprove or institute proceedings to
determine whether to disapprove the
proposed rule change (File Number SR–
NYSEArca–2016–28), as modified
byAmendment No. 1.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–08558 Filed 4–13–16; 8:45 am]
BILLING CODE 8011–01–P
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April 8, 2016.
On February 5, 2016, NYSE Arca, Inc.
(‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (‘‘Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change to
list and trade shares (‘‘Shares’’) of the
following under NYSE Arca Equities
Rule 8.600: RiverFront Dynamic US
Dividend Advantage ETF and
RiverFront Dynamic US Flex-Cap ETF.
The Commission published notice of the
proposed rule change in the Federal
12 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–77565; File No. SR–FINRA–
2016–005]
Self-Regulatory Organizations;
Financial Industry Regulatory
Authority, Inc.; Order Approving a
Proposed Rule Change To Reduce the
Synchronization Tolerance for
Computer Clocks That Are Used To
Record Events in NMS Securities and
OTC Equity Securities
April 8, 2016.
I. Introduction
On February 9, 2016, the Financial
Industry Regulatory Authority, Inc.
(‘‘FINRA’’) filed with the Securities and
Exchange Commission (‘‘Commission’’)
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a
proposed rule change to reduce the
synchronization tolerance for computer
clocks that are used to record events in
NMS Securities, including standardized
options and OTC Equity Securities. The
proposed rule change was published for
comment in the Federal Register on
February 25, 2016.3 Four comments
were received in response to the
proposal.4 This order approves the
proposed rule change.
II. Description of the Proposed Rule
Change
FINRA rules require that firms
synchronize their business clocks in
conformity with procedures prescribed
by FINRA. Specifically, FINRA Rule
7430 requires that firms synchronize
their business clocks that are used for
purposes of recording the date and time
of any event that must be recorded
pursuant to the FINRA By-Laws or other
FINRA rules (i.e., the time a trade was
executed or the time an order was
received or routed), with reference to a
time source as designated by FINRA.
Current OATS technical specifications
provide that all computer system clocks
and mechanical time stamping devices
must be synchronized to within one
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See Securities Exchange Act Release No. 77196
(Feb. 19, 2016), 81 FR 9550 (‘‘Notice’’).
4 See Letter from Kermit Kubitz, dated March 18,
2016 (‘‘Kubitz Letter’’); Letter from Dave Lauer,
Chairman, Healthy Markets Association, to Brent J.
Fields, Secretary, Commission, dated March 17,
2016 (‘‘Healthy Markets Letter); Letter from
Manisha Kimmel, Chief Regulatory Officer, Wealth
Management, Thompson Reuters, to Brent J. Fields,
Secretary, Commission, dated March 17, 2015
(‘‘Reuters Letter’’); Letter from Mary Lou Von
Kaenel, Managing Director, Financial Information
Forum, to Brent J. Fields, Secretary, Commission,
dated March 22, 2016 (‘‘FIF Letter’’).
2 17
3 See Securities Exchange Act Release No. 34–
77183 (February 19, 2016), 81 FR 9535 (February
25, 2016) (NYSEArca–2016–28).
4 Amendment No. 1 replaced and superseded the
original filing in its entirety.
5 15 U.S.C. 78s(b)(2).
6 Id.
7 17 CFR 200.30–3(a)(31).
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]]>Agencies
[Federal Register Volume 81, Number 72 (Thursday, April 14, 2016)]
[Notices]
[Pages 22133-22136]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-08559]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-77572; File No. SR-BOX-2016-14]
Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend the Fee Schedule on the BOX Market LLC (``BOX'') Options Facility
April 8, 2016.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on March 31, 2016, BOX Options Exchange LLC (the ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I, II, and III below, which
Items have been prepared by the Exchange. The Exchange filed the
proposed rule change pursuant to Section 19(b)(3)(A)(ii) of the Act,\3\
and Rule 19b-4(f)(2) thereunder,\4\ which renders the proposal
effective upon filing with the Commission. The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
The Exchange is filing with the Securities and Exchange Commission
(``Commission'') a proposed rule change to amend the Fee Schedule to
revise certain qualification thresholds and fees in Section I.B. of the
BOX Fee Schedule on the BOX Market LLC (``BOX'') options facility.
While changes to the fee schedule pursuant to this proposal will be
effective upon filing, the changes will become operative on April 1,
2016. The text of the proposed rule change is available from the
principal office of the Exchange, at the Commission's Public Reference
Room and also on the Exchange's Internet Web site at https://boxexchange.com.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the Fee Schedule for trading on BOX.
Specifically, the Exchange proposes to revise certain qualification
thresholds and fees in Section I.B. of the BOX Fee Schedule, the Tiered
Fee Schedule for Initiating Participants and BOX Volume Rebate
(``BVR'').
Under the Tiered Fee Schedule for Initiating Participants, the
Exchange assesses a per contract execution fee to all Primary
Improvement Order executions initiated by the particular Initiating
Participant. Percentage thresholds are calculated on a monthly basis by
totaling the Initiating Participant's Primary Improvement Order volume
submitted to BOX, relative to the total national Customer volume in
multiply-listed options classes. The current tiered fee schedule for
Initiating Participants is as follows:
------------------------------------------------------------------------
Percentage thresholds
of national customer Per contract
Tier volume in multiply- fee (all
listed options classes account types)
(monthly)
------------------------------------------------------------------------
1.............................. 0.000%-0.079%.......... $0.25
[[Page 22134]]
2.............................. 0.080%-0.159%.......... 0.20
3.............................. 0.160%-0.339%.......... 0.12
4.............................. 0.340%-0.849%.......... 0.07
5.............................. 0.850% and Above....... 0.03
------------------------------------------------------------------------
The Exchange proposes to adjust the percentage thresholds in Tiers
3 through 5. Additionally, the Exchange proposes to raise the fee
associated with Tier 5 from $0.03 to $0.05. The new Tiered Fee Schedule
for Initiating Participants set forth in Section I.B.1. of the BOX Fee
Schedule will be as follows:
------------------------------------------------------------------------
Percentage thresholds
of national customer Per contract
Tier volume in multiply- fee (all
listed options classes account types)
(monthly)
------------------------------------------------------------------------
1.............................. 0.000%-0.079%.......... $0.25
2.............................. 0.080%-0.159%.......... 0.20
3.............................. 0.160%-0.499%.......... 0.12
4.............................. 0.500%-0.999%.......... 0.07
5.............................. 1.000% and Above....... 0.05
------------------------------------------------------------------------
Next, the Exchange proposes to revise certain qualification
thresholds in the BVR. Under the current BVR, the Exchange offers a
tiered per contract rebate for all PIP Orders and COPIP orders of 100
contracts and under. Percentage thresholds are calculated on a monthly
basis by totaling the Participant's PIP and COPIP volume submitted to
BOX, relative to the total national Customer volume in multiply-listed
options classes.
The current per contract rebate for Participants in PIP and COPIP
Transactions under the BVR is:
----------------------------------------------------------------------------------------------------------------
Per contract rebate (all
Percentage thresholds of national account types)
Tier customer volume in multiply-listed -------------------------------
options classes (monthly) PIP COPIP
----------------------------------------------------------------------------------------------------------------
1.......................................... 0.000% to 0.159%................... ($0.00) ($0.00)
2.......................................... 0.160% to 0.339%................... ($0.04) ($0.02)
3.......................................... 0.340% to 0.849%................... ($0.11) ($0.04)
4.......................................... 0.850% and Above................... ($0.14) ($0.06)
----------------------------------------------------------------------------------------------------------------
The Exchange proposes to adjust the BVR percentage threshold for
Tier 3 to ``0.340% to 0.99%'' and Tier 4 to ``1.00% and Above.'' The
quantity submitted will continue to be calculated on a monthly basis by
totaling the Participant's PIP and COPIP volume submitted to BOX,
relative to the total national Customer volume in multiply-listed
options classes.
The new BVR set forth in Section I.B.2 of the BOX Fee Schedule will
be as follows:
----------------------------------------------------------------------------------------------------------------
Per contract rebate (all
Percentage thresholds of national account types)
Tier customer volume in multiply-listed -------------------------------
options classes (monthly) PIP COPIP
----------------------------------------------------------------------------------------------------------------
1.......................................... 0.000% to 0.159%................... ($0.00) ($0.00)
2.......................................... 0.160% to 0.339%................... ($0.04) ($0.02)
3.......................................... 0.340% to 0.99%.................... ($0.11) ($0.04)
4.......................................... 1.00% and Above.................... ($0.14) ($0.06)
----------------------------------------------------------------------------------------------------------------
Lastly, the Exchange is proposing to remove reference and
information relating to Mini Options, as the Exchange no longer lists
or trades Mini Options and has no current plans to do so.
The Exchange added rules relating to the listing of Mini Options
(options overlying 10 shares of stock) in 2013 \5\ and later changed
its Fee Schedule to address the treatment of Mini Options, including
establishing transactions fees for these products.\6\ However, the
Exchange no longer lists or trades Mini Option series, and has no
current plans to do so and proposes to strip references, and charges
related to, Mini Options from the Fee Schedule.
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\5\ See Securities Exchange Act Release No. 68771 (January 30,
2013), 78 FR 8208 (February 5, 2013) (Notice of Filing and Immediate
Effectiveness SR-BOX-2013-07).
\6\ See Securities Exchange Act Release No. 69202 (March 21,
2013), 78 FR 18642 (March 27, 2013) (Notice of Filing and Immediate
Effectiveness SR-BOX-2013-15).
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[[Page 22135]]
2. Statutory Basis
The Exchange believes that the proposal is consistent with the
requirements of Section 6(b) of the Act, in general, and Section
6(b)(4) and 6(b)(5) of the Act,\7\ in particular, in that it provides
for the equitable allocation of reasonable dues, fees, and other
charges among BOX Participants and other persons using its facilities
and does not unfairly discriminate between customers, issuers, brokers
or dealers.
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\7\ 15 U.S.C. 78f(b)(4) and (5).
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The Exchange believes the proposed amendments to the Tiered Fee
Schedule for Initiating Participants in Section I.B.1. of the BOX Fee
Schedule are reasonable, equitable and non-discriminatory. The reduced
fees related to trading activity in BOX Auction Transactions are
available to all BOX Options Participants that initiate Auction
Transactions, and they may choose whether or not to trade on BOX to
take advantage of the discounted fees for doing so. The Exchange also
believes adjusting certain percentage thresholds within the tiers and a
fee associated with a tier is reasonable and appropriate, as this
Tiered Fee Schedule is in place to provide incentives to BOX
Participants to submit their customer order into the PIP for potential
price improvement. Further, the Exchange believes the proposed
thresholds and fees remain competitive when compared to the auction
transaction fees on other exchanges.\8\
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\8\ Comparative fees at other exchanges range from $0.05 to
$0.30. See Section IV of the Phlx Pricing Schedule entitled ``PIXL
Pricing''; International Securities Exchange (``ISE'') Schedule of
Fees, Section I. Regular Order Fees and Rebates ``Select Symbols.''
---------------------------------------------------------------------------
The Exchange also believes the proposed amendments to the BVR in
Section I.B of the BOX Fee Schedule are reasonable, equitable and non-
discriminatory. The BVR was adopted to attract Public Customer order
flow to the Exchange by offering these Participants incentives to
submit their PIP and COPIP Orders to the Exchange and the Exchange
believes it is appropriate to now amend the BVR. The Exchange believes
it is equitable and not unfairly discriminatory to amend the BVR, as
all Participants have the ability to qualify for a rebate, and rebates
are provided equally to qualifying Participants. Finally, the Exchange
believes it is reasonable and appropriate to continue to provide
incentives for Public Customers, which will result in greater liquidity
and ultimately benefit all Participants trading on the Exchange.
BOX believes it is reasonable, equitable and not unfairly
discriminatory to adjust the monthly Percentage Thresholds of National
Customer Volume in Multiply-Listed Options Classes. The volume
thresholds and applicable rebates are meant to incentivize Participants
to direct order flow to the Exchange to obtain the benefit of the
rebate, which will in turn benefit all market participants by
increasing liquidity on the Exchange. Other exchanges employ similar
incentive programs; \9\ and the Exchange believes that the proposed
changes to the volume thresholds and rebates are reasonable and
competitive when compared to incentive structures at other exchanges.
---------------------------------------------------------------------------
\9\ See Section B of the PHLX Pricing Schedule entitled
``Customer Rebate Program;'' ISE Gemini's Qualifying Tier Thresholds
(page 6 of the ISE Gemini Fee Schedule); and CBOE's Volume Incentive
Program (VIP).
---------------------------------------------------------------------------
Lastly, the Exchange believes the proposed change to remove
references and information relating to Mini Options from the Fee
Schedule is reasonable, equitable, and not unfairly discriminatory, as
the Exchange no longer lists or trades Mini-option series and has no
intention to do so at this time. Thus, removing outmoded references on
the Fee Schedule would alleviate potential investor confusion and
improve the clarity and transparency of the Fee Schedule. The proposed
change is also reasonable, equitable, and not unfairly discriminatory
as it applies to all market participants.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange is simply
proposing to revise certain qualification thresholds and fees in the
Section I.B. of the BOX Fee Schedule. The Exchange believes that the
volume based rebates and fees increase intermarket and intramarket
competition by incenting Participants to direct their order flow to the
exchange, which benefits all participants by providing more trading
opportunities and improves competition on the Exchange. The Exchange
also believes the removal of references to Mini Options will not impose
any burden on competition but will serve to promote regulatory clarity
and consistency, thereby reducing burdens on the marketplace and
facilitating investor protection.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Exchange Act \10\ and Rule 19b-4(f)(2)
thereunder,\11\ because it establishes or changes a due, or fee.
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\10\ 15 U.S.C. 78s(b)(3)(A)(ii).
\11\ 17 CFR 240.19b-4(f)(2).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend the rule
change if it appears to the Commission that the action is necessary or
appropriate in the public interest, for the protection of investors, or
would otherwise further the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-BOX-2016-14 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-BOX-2016-14. 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
[[Page 22136]]
Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for Web site viewing and printing in
the Commission's Public Reference Room, 100 F Street NE., Washington,
DC 20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of such filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change; the Commission does not edit
personal identifying information from submissions. You should submit
only information that you wish to make available publicly. All
submissions should refer to File Number SR-BOX-2016-14, and should be
submitted on or before May 5, 2016.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-08559 Filed 4-13-16; 8:45 am]
BILLING CODE 8011-01-P
