Self-Regulatory Organizations; Bats BYX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees for Use on Bats BYX Exchange, Inc., 10101-10102 [2017-02647]

Download as PDF Federal Register / Vol. 82, No. 26 / Thursday, February 9, 2017 / Notices Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant parts of such statements. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–79966; File No. SR– BatsBYX–2017–04] Self-Regulatory Organizations; Bats BYX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees for Use on Bats BYX Exchange, Inc. February 3, 2017. 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 February 2, 2017, Bats BYX Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BYX’’) 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 has designated the proposed rule change as one establishing or changing a member due, fee, or other charge imposed by the Exchange under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b–4(f)(2) thereunder,4 which renders the proposed rule change 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 Substance of the Proposed Rule Change The Exchange filed a proposal to amend the fee schedule applicable to Members 5 and non-members of the Exchange pursuant to BYX Rules 15.1(a) and (c). The text of the proposed rule change is available at the Exchange’s Web site at www.bats.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. sradovich on DSK3GMQ082PROD with NOTICES 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 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). 5 The term ‘‘Member’’ is defined as ‘‘any registered broker or dealer that has been admitted to membership in the Exchange.’’ See Exchange Rule 1.5(n). VerDate Sep<11>2014 18:11 Feb 08, 2017 Jkt 241001 (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 fee schedule applicable to the Exchange’s equities platform, effective immediately,6 to add Add Volume Tier 3 under footnote 1. Currently, the Exchange charges a standard rate of $0.0018 per share for orders that add liquidity that are appended with fee codes B, V or Y. Under footnote 1, Tier 1 the Exchange offers a reduced rate of $0.0014 for orders adding liquidity where a Member has an ADAV 7 of at least 0.30% of the TCV.8 Under footnote 1, Tier 2 the Exchange offers a reduced rate of $0.0013 for orders adding liquidity where a Member has an ADAV of at least 0.40% of the TCV. The Exchange proposes to add Tier 3 offering a reduced rate for orders adding liquidity of $0.0012 where a Member has an ADAV of at least 0.55% of the TCV. In connection with this change, the Exchange also proposes to renumber existing Tier 3 under footnote 1 as Tier 4. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with the objectives of Section 6 of the Act,9 in general, and furthers the objectives of Section 6(b)(4),10 in particular, as it is designed to provide for the equitable allocation of reasonable dues, fees and other charges among its Members and other persons using its facilities. Volume-based incentives such as those currently maintained on the Exchange have been widely adopted by equities and options exchanges and are equitable because they are open to all Members on an equal basis and provide additional benefits or discounts that are reasonably related to the value to an exchange’s market quality associated with higher levels of market activity, such as higher levels of liquidity provision and/or growth patterns, and introduction of 6 The Exchange initially submitted the proposed rule change on February 1, 2017. (SR–BatsBYX– 2017–03). On February 2, 2017, the Exchange withdrew SR–BatsBYX–2017–03 and submitted SR–BatsBYX–2017–04. 7 As defined in the Exchange’s fee schedule. 8 As defined in the Exchange’s fee schedule. 9 15 U.S.C. 78f. 10 15 U.S.C. 78f(b)(4). PO 00000 Frm 00119 Fmt 4703 Sfmt 4703 10101 higher volumes of orders into the price and volume discovery processes. In particular, the Exchange believes the addition of Tier 3 under footnote 1 is a reasonable means to encourage Members to increase their liquidity on the Exchange. The Exchange further believes that the proposed tier represents an equitable allocation of reasonable dues, fees, and other charges because the thresholds necessary to achieve the tiers encourages Members to add additional liquidity to the Exchange. Specifically, the Exchange notes that the criteria and reduced rate under proposed Tier 3 are equitable and reasonable as compared to other tiers offered by the Exchange, particularly Tiers 1 and 2, as described above. Therefore, the Exchange believes the proposed Tier 3 is consistent with Section 6(b)(4) 11 of the Act as the more stringent criteria correlates with the tier’s reduced rate. (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 does not believe the proposed tier will impose an undue burden on competition because the Exchange will uniformly offer the reduced fee to all qualifying Members. In fact, the Exchange believes the proposed tier enhances competition, as it is intended to increase the competitiveness of and draw additional volume to the Exchange. The Exchange does not believe that the proposed change represents a significant departure from the Exchange’s current pricing structure, but instead, is merely another incentive offered by the Exchange to encourage Members to contribute to the growth of the Exchange. Additionally, Members may opt to disfavor the Exchange’s pricing if they believe that alternatives offer them better value or if they view the fees as excessive. Further, excessive fees would serve to impair an exchange’s ability to compete for order flow and members rather than burdening competition. (C) Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others The Exchange has not solicited, and does not intend to solicit, comments on this proposed rule change. The Exchange has not received any 11 15 E:\FR\FM\09FEN1.SGM U.S.C. 78f(b)(4). 09FEN1 10102 Federal Register / Vol. 82, No. 26 / Thursday, February 9, 2017 / Notices unsolicited written comments from Members or other interested parties. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 12 and paragraph (f) of Rule 19b–4 thereunder.13 At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. 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: sradovich on DSK3GMQ082PROD with NOTICES Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– BatsBYX–2017–04 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–BatsBYX–2017–04. 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 (http://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 12 15 13 17 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f). VerDate Sep<11>2014 18:11 Feb 08, 2017 Jkt 241001 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– BatsBYX–2017–04 and should be submitted on or before March 2, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.14 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–02647 Filed 2–8–17; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–79956; File No. SR– BatsBZX–2017–05] Self-Regulatory Organizations; Bats BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Adopt a New Type of Logical Port Known as a Purge Port February 3, 2017. 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 January 23, 2017, Bats BZX Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BZX’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange has designated this proposal as a ‘‘noncontroversial’’ proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f)(6)(iii) thereunder,4 which renders it 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 Substance of the Proposed Rule Change The Exchange filed a proposal to amend Exchange Rule 22.11, Mass Cancellation of Trading Interest, to 14 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(6)(iii). PO 00000 Frm 00120 Fmt 4703 Sfmt 4703 reflect the proposed Purge Port functionality. The text of the proposed changes to Exchange Rule 22.11 is attached as Exhibit 5A. The proposed changes to the fee schedule are attached as Exhibit 5B. The text of the proposed rule change is available at the Exchange’s Web site at www.bats.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 parts 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 also offers a bulkquoting interface which allows Users of BZX Options to submit and update multiple bids and offers in one message through logical ports enabled for bulkquoting. Purge Ports The Exchange now proposes to modify the BZX Options fee schedule to identify fees for Purge Ports, a new type of logical port which would enable Options Members 5 to cancel/purge all open orders, or a subset thereof, across multiple logical ports through a single cancel/purge message. The Exchange also proposes to amend Exchange Rule 22.11, Mass Cancellation of Trading Interest, to reflect the proposed Purge Port functionality. The proposed ports are designed to assist Options Members, including Market Makers, in the management of, and risk control over, their quotes, particularly if the Options Member is dealing with a large number of options. For example, if an Options Member detects market indications that may influence the direction or bias of 5 ‘‘Options Member’’ is defined as ‘‘a firm, or organization that is registered with the Exchange pursuant to Chapter XVII of these Rules for purposes of participating in options trading on EDGX Options as an ‘Options Order Entry Firm’ or ‘Options Market Maker.’ ’’ See Exchange Rule 16.1(a)(38). E:\FR\FM\09FEN1.SGM 09FEN1

Agencies

[Federal Register Volume 82, Number 26 (Thursday, February 9, 2017)]
[Notices]
[Pages 10101-10102]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-02647]



[[Page 10101]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-79966; File No. SR-BatsBYX-2017-04]


Self-Regulatory Organizations; Bats BYX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change Related to 
Fees for Use on Bats BYX Exchange, Inc.

February 3, 2017.
    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 February 2, 2017, Bats BYX Exchange, Inc. (the ``Exchange'' or 
``BYX'') 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 has designated the proposed rule change as one establishing or 
changing a member due, fee, or other charge imposed by the Exchange 
under Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) 
thereunder,\4\ which renders the proposed rule change 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).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend the fee schedule applicable 
to Members \5\ and non-members of the Exchange pursuant to BYX Rules 
15.1(a) and (c).
---------------------------------------------------------------------------

    \5\ The term ``Member'' is defined as ``any registered broker or 
dealer that has been admitted to membership in the Exchange.'' See 
Exchange Rule 1.5(n).
---------------------------------------------------------------------------

    The text of the proposed rule change is available at the Exchange's 
Web site at www.bats.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 parts of such 
statements.

(A) Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its fee schedule applicable to the 
Exchange's equities platform, effective immediately,\6\ to add Add 
Volume Tier 3 under footnote 1. Currently, the Exchange charges a 
standard rate of $0.0018 per share for orders that add liquidity that 
are appended with fee codes B, V or Y. Under footnote 1, Tier 1 the 
Exchange offers a reduced rate of $0.0014 for orders adding liquidity 
where a Member has an ADAV \7\ of at least 0.30% of the TCV.\8\ Under 
footnote 1, Tier 2 the Exchange offers a reduced rate of $0.0013 for 
orders adding liquidity where a Member has an ADAV of at least 0.40% of 
the TCV. The Exchange proposes to add Tier 3 offering a reduced rate 
for orders adding liquidity of $0.0012 where a Member has an ADAV of at 
least 0.55% of the TCV. In connection with this change, the Exchange 
also proposes to re-number existing Tier 3 under footnote 1 as Tier 4.
---------------------------------------------------------------------------

    \6\ The Exchange initially submitted the proposed rule change on 
February 1, 2017. (SR-BatsBYX-2017-03). On February 2, 2017, the 
Exchange withdrew SR-BatsBYX-2017-03 and submitted SR-BatsBYX-2017-
04.
    \7\ As defined in the Exchange's fee schedule.
    \8\ As defined in the Exchange's fee schedule.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the objectives of Section 6 of the Act,\9\ in general, and 
furthers the objectives of Section 6(b)(4),\10\ in particular, as it is 
designed to provide for the equitable allocation of reasonable dues, 
fees and other charges among its Members and other persons using its 
facilities. Volume-based incentives such as those currently maintained 
on the Exchange have been widely adopted by equities and options 
exchanges and are equitable because they are open to all Members on an 
equal basis and provide additional benefits or discounts that are 
reasonably related to the value to an exchange's market quality 
associated with higher levels of market activity, such as higher levels 
of liquidity provision and/or growth patterns, and introduction of 
higher volumes of orders into the price and volume discovery processes.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

    In particular, the Exchange believes the addition of Tier 3 under 
footnote 1 is a reasonable means to encourage Members to increase their 
liquidity on the Exchange. The Exchange further believes that the 
proposed tier represents an equitable allocation of reasonable dues, 
fees, and other charges because the thresholds necessary to achieve the 
tiers encourages Members to add additional liquidity to the Exchange. 
Specifically, the Exchange notes that the criteria and reduced rate 
under proposed Tier 3 are equitable and reasonable as compared to other 
tiers offered by the Exchange, particularly Tiers 1 and 2, as described 
above. Therefore, the Exchange believes the proposed Tier 3 is 
consistent with Section 6(b)(4) \11\ of the Act as the more stringent 
criteria correlates with the tier's reduced rate.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

(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 does not believe 
the proposed tier will impose an undue burden on competition because 
the Exchange will uniformly offer the reduced fee to all qualifying 
Members. In fact, the Exchange believes the proposed tier enhances 
competition, as it is intended to increase the competitiveness of and 
draw additional volume to the Exchange. The Exchange does not believe 
that the proposed change represents a significant departure from the 
Exchange's current pricing structure, but instead, is merely another 
incentive offered by the Exchange to encourage Members to contribute to 
the growth of the Exchange. Additionally, Members may opt to disfavor 
the Exchange's pricing if they believe that alternatives offer them 
better value or if they view the fees as excessive. Further, excessive 
fees would serve to impair an exchange's ability to compete for order 
flow and members rather than burdening competition.

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

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any

[[Page 10102]]

unsolicited written comments from Members or other interested parties.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \12\ and paragraph (f) of Rule 19b-4 
thereunder.\13\ At any time within 60 days of the filing of the 
proposed rule change, the Commission summarily may temporarily suspend 
such rule change if it appears to the Commission that such action is 
necessary or appropriate in the public interest, for the protection of 
investors, or otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-BatsBYX-2017-04 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-BatsBYX-2017-04. 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 (http://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-BatsBYX-2017-04 and should 
be submitted on or before March 2, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-02647 Filed 2-8-17; 8:45 am]
BILLING CODE 8011-01-P