Self-Regulatory Organizations; BOX Options Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fee Schedule To Adopt Participant Fees on the BOX Market LLC (“BOX”) Options Facility, 70214-70216 [2016-24423]
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70214
Federal Register / Vol. 81, No. 196 / Tuesday, October 11, 2016 / Notices
Investment Transaction for all purposes
and subject to the other conditions set
forth in the application.
9. The Non-Interested Directors of
each Regulated Fund will be provided
quarterly for review all information
concerning Potential Co-Investment
Transactions and Co-Investment
Transactions, including investments
made by other Regulated Funds or
Affiliated Funds that the Regulated
Fund considered but declined to
participate in, so that the Non-Interested
Directors may determine whether all
investments made during the preceding
quarter, including those investments
that the Regulated Fund considered but
declined to participate in, comply with
the conditions of the Order. In addition,
the Non-Interested Directors will
consider at least annually the continued
appropriateness for the Regulated Fund
of participating in new and existing CoInvestment Transactions.
10. Each Regulated Fund will
maintain the records required by section
57(f)(3) of the Act as if each of the
Regulated Funds were a BDC and each
of the investments permitted under
these conditions were approved by the
Required Majority under section 57(f) of
the Act.
11. No Non-Interested Director of a
Regulated Fund will also be a director,
general partner, managing member or
principal, or otherwise an ‘‘affiliated
person’’ (as defined in the Act) of an
Affiliated Fund.
12. The expenses, if any, associated
with acquiring, holding or disposing of
any securities acquired in a CoInvestment Transaction (including,
without limitation, the expenses of the
distribution of any such securities
registered for sale under the Securities
Act) will, to the extent not payable by
the Advisers under their respective
investment advisory agreements with
Affiliated Funds and the Regulated
Funds, be shared by the Regulated
Funds and the Affiliated Funds in
proportion to the relative amounts of the
securities held or to be acquired or
disposed of, as the case may be.
13. Any transaction fee 12 (including
break-up or commitment fees but
excluding broker’s fees contemplated by
section 17(e) or 57(k) of the Act, as
applicable), received in connection with
a Co-Investment Transaction will be
distributed to the participating
Regulated Funds and Affiliated Funds
on a pro rata basis based on the amounts
they invested or committed, as the case
12 Applicants are not requesting and the staff is
not providing any relief for transaction fees
received in connection with any Co-Investment
Transaction.
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may be, in such Co-Investment
Transaction. If any transaction fee is to
be held by an Adviser pending
consummation of the transaction, the
fee will be deposited into an account
maintained by such Adviser at a bank or
banks having the qualifications
prescribed in section 26(a)(1) of the Act,
and the account will earn a competitive
rate of interest that will also be divided
pro rata among the participating
Regulated Funds and Affiliated Funds
based on the amounts they invest in
such Co-Investment Transaction. None
of the Affiliated Funds, the Advisers,
the other Regulated Funds or any
affiliated person of the Regulated Funds
or Affiliated Funds will receive
additional compensation or
remuneration of any kind as a result of
or in connection with a Co-Investment
Transaction (other than (a) in the case
of the Regulated Funds and the
Affiliated Funds, the pro rata
transaction fees described above and
fees or other compensation described in
condition 2(c)(iii)(C); and (b) in the case
of an Adviser, investment advisory fees
paid in accordance with the agreement
between the Adviser and the Regulated
Fund or Affiliated Fund).
14. If the Holders own in the aggregate
more than 25% of the Shares of a
Regulated Fund, then the Holders will
vote such Shares as directed by an
independent third party when voting on
(1) the election of directors; (2) the
removal of one or more directors; or (3)
any other matter under either the Act or
applicable State law affecting the
Board’s composition, size or manner of
election.
For the Commission, by the Division of
Investment Management, under delegated
authority.
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–24428 Filed 10–7–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–79038; File No. SR–BOX–
2016–47]
Self-Regulatory Organizations; BOX
Options Exchange LLC; Notice of
Filing and Immediate Effectiveness of
a Proposed Rule Change To Amend
the Fee Schedule To Adopt Participant
Fees on the BOX Market LLC (‘‘BOX’’)
Options Facility
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
Frm 00130
Fmt 4703
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 adopt
Participant Fees 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
October 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 to
establish two Participant Fees; a
1 15
October 4, 2016.
PO 00000
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on
September 28, 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.
Sfmt 4703
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(ii).
4 17 CFR 240.19b–4(f)(2).
2 17
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Federal Register / Vol. 81, No. 196 / Tuesday, October 11, 2016 / Notices
monthly Participant Fee and a one-time
Initiation Fee applicable to all BOX
Participants.
First, the Exchange proposes to adopt
a Participant Fee of $1,500 per month,
applicable to all BOX Participants.
Currently, the Exchange does not assess
BOX Participants a fee to access its
options market. The Exchange believes
the Participant Fee is competitive with
fees at other option exchanges.5
Next, the Exchange proposes to adopt
a one-time Initiation Fee of $2,500
which will be assessed to all new BOX
Participants upon their initial
connection to the options market, so the
Exchange can recoup some of the costs
associated with processing and
preparing technology in order for the
new BOX Participant to be able to trade
on BOX. The Exchange’s proposed onetime Initiation Fee is similar to and
generally lower than one time
application fees in place at other
options exchanges.6
2. Statutory Basis
asabaliauskas on DSK3SPTVN1PROD with NOTICES
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’s proposal to adopt a
BOX Options Participant Fee of $1,500
per month is reasonable because the
Exchange is seeking to recoup costs
related to membership administration.
5 See The Chicago Board Options Exchange,
Incorporated’s Fees Schedule. Per month a Market
Maker Trading Permit is $5,500, an SPX Tier
Appointment is $3,000, a VIX Tier Appointment is
$2,000, and an Electronic Access Permit is $1,600.
See also the International Securities Exchange
LLC’s Schedule of Fees. Per month an Electronic
Access Member is assessed $500.00 for membership
and a market maker is assessed from $2,000 to
$4,000 per membership depending on the type of
market maker. See also C2 Options Exchange,
Incorporated’s Fees Schedule. Per month, a marketmaker is assessed a $5,000 permit fee, an Electronic
Access Permit is assessed a $1,000 permit fee. See
also NYSE Arca, Inc.’s Fee Schedule. Per month, a
Clearing Firm is assessed a $1,000 per month fee
for the first Options Trading Permit (‘‘OTP’’) and
$250 thereafter, and a market maker is assessed a
permit based on the maximum number of OTPs
held by an OTP Firm or OTP Holder during a
calendar month ranging from $1,000 to $6,000 a
month.
6 The Chicago Board Options Exchange,
Incorporated (‘‘CBOE’’) charges $3,000 for an
individual applicant and $5,000 for an applicant
organization and at the International Securities
Exchange, LLC (‘‘ISE’’) charges $7,500 for a Primary
Market Maker, $5,500 for a Competitive Market
Maker and $3,500 for an Electronic Access Member.
7 15 U.S.C. 78f(b)(4) and (5).
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20:12 Oct 07, 2016
Jkt 241001
The proposed fee is competitive with
similar fees at other options exchanges.8
Lastly, the Exchange believes the
Participant Fee of $1,500 is equitable
and not unfairly discriminatory because
the Participant Fee will be assessed
uniformly to each BOX Participant,
regardless of Participant type.
The Exchange also believes that its
one-time Initiation Fee of $2,500 is
reasonable, equitable and not unfairly
discriminatory. As described above, the
one-time Initiation Fee is comparable to
other similar fees in place at other
options exchanges and is designed to
cover costs associated with processing
and preparing technology in order for a
Participant to begin trading on BOX.
The Exchange believes that the
Initiation Fee is equitable and not
unfairly discriminatory, as it will be
assessed uniformly to each new BOX
Options Participant, regardless of
Participant type.
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. 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’s proposal to adopt a BOX
Options Participant Fee of $1,500 per
month and a one-time Initiation Fee of
$2,500 does not impose an undue
burden on competition because the
Exchange would uniformly assess the
same Participant Fees to each BOX
Options Participant. If the changes
proposed herein are unattractive to
market participants, it is likely that the
Exchange will lose Participants.
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.
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 9 and
Rule 19b–4(f)(2) thereunder,10 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 rulecomments@sec.gov. Please include File
Number SR–BOX–2016–47 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–2016–47. 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
9 15
8 See
PO 00000
supra note 5.
Frm 00131
Fmt 4703
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
10 17
Sfmt 4703
70215
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70216
Federal Register / Vol. 81, No. 196 / Tuesday, October 11, 2016 / Notices
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549 on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of such
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–BOX–
2016–47, and should be submitted on or
before November 1, 2016.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016–24423 Filed 10–7–16; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–79036; File No. SR–IEX–
2016–16]
Self-Regulatory Organizations;
Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Adopt Rules
To Implement the Quoting and Trading
Provisions of the Tick Size Pilot
Program and To Describe Related
Changes to IEX System Functionality
asabaliauskas on DSK3SPTVN1PROD with NOTICES
October 4, 2016.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on October
3, 2016, the Investors Exchange LLC
(‘‘IEX’’ or the ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(the ‘‘Commission’’) the proposed rule
11 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
1 15
VerDate Sep<11>2014
20:12 Oct 07, 2016
Jkt 241001
change as described in Items I and II
below, which Items have been prepared
by the self-regulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
IEX is filing with the Commission a
proposed rule change to adopt rules
under IEX Rule 11.340 to implement the
quoting and trading provisions of the
Regulation NMS Plan to Implement a
Tick Size Pilot Program submitted to the
Commission pursuant to Rule 608 of
Regulation NMS 4 under the Act (the
‘‘Plan’’),5 and to describe changes to IEX
system functionality necessary to
implement the Plan. The proposed rule
change is substantially similar to
proposed rule changes published by the
Commission for the NASDAQ Stock
Market LLC (‘‘Nasdaq’’) to adopt
NASDAQ Rule 4770, which also
implemented the quoting and trading
provisions of the Plan.6 Accordingly,
the Exchange has designated this
proposal as a ‘‘non-controversial’’
proposed rule change pursuant to
Section 19(b)(3)(A) of the Act 7 and
provided the Commission with the
notice required by Rule 19b–4(f)(6)(iii)
under the Act.8
The text of the proposed rule change
is available at the Exchange’s Web site
at www.iextrading.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
self-regulatory organization 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 statement may be examined at
the places specified in Item IV below.
The self-regulatory organization has
prepared summaries, set forth in
Sections A, B, and C below, of the most
significant aspects of such statements.
4 17
CFR 242.608.
Securities and Exchange Act Release No.
74892 (May 6, 2015), 80 FR 27513 (File No. 4–657)
(‘‘Tick Plan Approval Order’’). See also Securities
and Exchange Act Release No. 76382 (November 6,
2015) (File No. 4–657), 80 FR 70284 (File No. 4–
657) (November 13, 2015), which extended the pilot
period commencement date from May 6, 2015 to
October 3, 2016.
6 See Securities and Exchange Act Release No.
78251 (July 7, 2016); 81 FR 45315 (July 13, 2016.
7 15 U.S.C. 78s(b)(3)(a).
8 17 CFR 240.19b–4(f)(6)(iii).
5 See
PO 00000
Frm 00132
Fmt 4703
Sfmt 4703
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to establish
rules to require its members to comply
with the requirements of the Plan,
which is designed to study and assess
the impact of increment conventions on
the liquidity and trading of the common
stocks of small capitalization
companies. The Exchange proposes
changes to its rules for a two-year pilot
period that coincides with the Pilot
Period for the Plan, which is currently
scheduled as a two-year pilot to begin
on October 3, 2016.
Background
On August 25, 2014, NYSE Group,
Inc., on behalf of BATS Exchange, Inc.,
BATS Y-Exchange, Inc., Chicago Stock
Exchange, Inc., EDGA Exchange, Inc.,
EDGX Exchange, Inc., Financial
Industry Regulatory Authority, Inc.
(‘‘FINRA’’), NASDAQ OMX BX, Inc.,
NASDAQ OMX PHLX LLC, the Nasdaq
Stock Market LLC, New York Stock
Exchange LLC (‘‘NYSE’’), NYSE MKT
LLC, and NYSE Arca, Inc. (collectively
‘‘Participants’’), filed with the
Commission, pursuant to Section 11A of
the Act 9 and Rule 608 of Regulation
NMS thereunder, the Plan to Implement
a Tick Size Pilot Program (‘‘Pilot’’).10
The Participants filed the Plan to
comply with an order issued by the
Commission on June 24, 2014 (the ‘‘June
2014 Order’’).11 The Plan 12 was
published for comment in the Federal
Register on November 7, 2014,13 and
approved by the Commission, as
modified, on May 6, 2015.14 An
amendment to the Plan adding IEX as a
Participant became effective on August
5, 2016.15
The Plan is designed to allow the
Commission, market participants, and
the public to study and assess the
impact of increment conventions on the
9 15
U.S.C. 78k–1
Letter from Brendon J. Weiss, Vice
President, Intercontinental Exchange, Inc., to
Secretary, Commission, dated August 25, 2014.
11 See Securities Exchange Act Release No. 72460
(June 24, 2014), 79 FR 36840 (June 30, 2014).
12 Unless otherwise specified, capitalized terms
used in this rule filing are based on the defined
terms of the Plan.
13 See Securities Exchange Act Release No. 72460
(June 24, 2014), 79 FR 36840 (June 30, 2014).
14 See Tick Plan Approval Order, supra note 5.
See also Securities Exchange Act Release No. 77277
(March 3, 2016), 81 FR 12162 (March 8, 2016) (File
No. 4–657), which amended the Plan to add
National Stock Exchange, Inc. as a Participant.
15 See Securities Exchange Act Release No. 78703
(August 26, 2016; 81 FR 60397 (September 1, 2016)
(File No. 4–631).
10 See
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]]>Agencies
[Federal Register Volume 81, Number 196 (Tuesday, October 11, 2016)]
[Notices]
[Pages 70214-70216]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-24423]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-79038; File No. SR-BOX-2016-47]
Self-Regulatory Organizations; BOX Options Exchange LLC; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend the Fee Schedule To Adopt Participant Fees on the BOX Market LLC
(``BOX'') Options Facility
October 4, 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 September 28, 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
adopt Participant Fees 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
October 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
to establish two Participant Fees; a
[[Page 70215]]
monthly Participant Fee and a one-time Initiation Fee applicable to all
BOX Participants.
First, the Exchange proposes to adopt a Participant Fee of $1,500
per month, applicable to all BOX Participants. Currently, the Exchange
does not assess BOX Participants a fee to access its options market.
The Exchange believes the Participant Fee is competitive with fees at
other option exchanges.\5\
---------------------------------------------------------------------------
\5\ See The Chicago Board Options Exchange, Incorporated's Fees
Schedule. Per month a Market Maker Trading Permit is $5,500, an SPX
Tier Appointment is $3,000, a VIX Tier Appointment is $2,000, and an
Electronic Access Permit is $1,600. See also the International
Securities Exchange LLC's Schedule of Fees. Per month an Electronic
Access Member is assessed $500.00 for membership and a market maker
is assessed from $2,000 to $4,000 per membership depending on the
type of market maker. See also C2 Options Exchange, Incorporated's
Fees Schedule. Per month, a market-maker is assessed a $5,000 permit
fee, an Electronic Access Permit is assessed a $1,000 permit fee.
See also NYSE Arca, Inc.'s Fee Schedule. Per month, a Clearing Firm
is assessed a $1,000 per month fee for the first Options Trading
Permit (``OTP'') and $250 thereafter, and a market maker is assessed
a permit based on the maximum number of OTPs held by an OTP Firm or
OTP Holder during a calendar month ranging from $1,000 to $6,000 a
month.
---------------------------------------------------------------------------
Next, the Exchange proposes to adopt a one-time Initiation Fee of
$2,500 which will be assessed to all new BOX Participants upon their
initial connection to the options market, so the Exchange can recoup
some of the costs associated with processing and preparing technology
in order for the new BOX Participant to be able to trade on BOX. The
Exchange's proposed one-time Initiation Fee is similar to and generally
lower than one time application fees in place at other options
exchanges.\6\
---------------------------------------------------------------------------
\6\ The Chicago Board Options Exchange, Incorporated (``CBOE'')
charges $3,000 for an individual applicant and $5,000 for an
applicant organization and at the International Securities Exchange,
LLC (``ISE'') charges $7,500 for a Primary Market Maker, $5,500 for
a Competitive Market Maker and $3,500 for an Electronic Access
Member.
---------------------------------------------------------------------------
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.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------
The Exchange's proposal to adopt a BOX Options Participant Fee of
$1,500 per month is reasonable because the Exchange is seeking to
recoup costs related to membership administration. The proposed fee is
competitive with similar fees at other options exchanges.\8\ Lastly,
the Exchange believes the Participant Fee of $1,500 is equitable and
not unfairly discriminatory because the Participant Fee will be
assessed uniformly to each BOX Participant, regardless of Participant
type.
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\8\ See supra note 5.
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The Exchange also believes that its one-time Initiation Fee of
$2,500 is reasonable, equitable and not unfairly discriminatory. As
described above, the one-time Initiation Fee is comparable to other
similar fees in place at other options exchanges and is designed to
cover costs associated with processing and preparing technology in
order for a Participant to begin trading on BOX. The Exchange believes
that the Initiation Fee is equitable and not unfairly discriminatory,
as it will be assessed uniformly to each new BOX Options Participant,
regardless of Participant type.
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. 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's proposal to
adopt a BOX Options Participant Fee of $1,500 per month and a one-time
Initiation Fee of $2,500 does not impose an undue burden on competition
because the Exchange would uniformly assess the same Participant Fees
to each BOX Options Participant. If the changes proposed herein are
unattractive to market participants, it is likely that the Exchange
will lose Participants. 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.
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 \9\ and Rule 19b-4(f)(2)
thereunder,\10\ because it establishes or changes a due, or fee.
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\9\ 15 U.S.C. 78s(b)(3)(A)(ii).
\10\ 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-2016-47 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-2016-47. 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
[[Page 70216]]
post all comments on the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent
amendments, all written statements with respect to the proposed rule
change that are filed with the Commission, and all written
communications relating to the proposed rule change between the
Commission and any person, other than those that may be withheld from
the public in accordance with the provisions of 5 U.S.C. 552, will be
available for Web site viewing and printing in the Commission's Public
Reference Room, 100 F Street NE., Washington, DC 20549 on official
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of
such filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-BOX-2016-47, and should be submitted on or before
November 1, 2016.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2016-24423 Filed 10-7-16; 8:45 am]
BILLING CODE 8011-01-P
