Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the NYSE Arca Options Fee Schedule, 26532-26534 [2017-11749]

Download as PDF 26532 Federal Register / Vol. 82, No. 108 / Wednesday, June 7, 2017 / Notices • Send an email to rule-comments@ sec.gov. Please include File Number SR– BatsEDGX–2017–24 on the subject line. SECURITIES AND EXCHANGE COMMISSION Paper Comments [Release No. 34–80838; File No. SR– NYSEArca–2017–61] • 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–BatsEDGX–2017–24. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549, on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR– BatsEDGX–2017–24, and should be submitted on or before June 28, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.21 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–11744 Filed 6–6–17; 8:45 am] sradovich on DSK3GMQ082PROD with NOTICES BILLING CODE 8011–01–P Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the NYSE Arca Options Fee Schedule June 1, 2017. 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 May 31, 2017, NYSE Arca, Inc. (the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I, II, and III 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 the Substance of the Proposed Rule Change The Exchange proposes to amend the NYSE Arca Options Fee Schedule (‘‘Fee Schedule’’) with respect to the Lead Market Maker (‘‘LMM’’) Rights Fee. The Exchange proposes to implement the fee change effective June 1, 2017. The proposed rule change is available on the Exchange’s Web site at www.nyse.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 those 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. 1 15 U.S.C. 78s(b)(1). U.S.C. 78a. 3 17 CFR 240.19b–4. 2 15 21 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 16:37 Jun 06, 2017 Jkt 241001 PO 00000 Frm 00110 Fmt 4703 Sfmt 4703 A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The purpose of this filing is to modify the calculation of the threshold for qualification for the LMM Rights Fee discount. The LMM Rights Fee is charged ‘‘on a per issue basis to the OTP Firm acting as LMM in the issue.’’ 4 The Exchange charges a Rights Fee on each issue in a LMM’s allocation, with rates based on the Average National Daily Customer Contracts. LMMs are also able to achieve a 50% discount to their total monthly LMM Rights Fee by achieving an average daily volume (‘‘ADV’’) of 50,000 contracts, of which at least 10,000 are within its LMM Appointment (the ‘‘Discount’’).5 The Exchange proposes to replace the static minimum contract thresholds of 50,000 and 10,000 with market share criteria expressed as a percentage of Total Industry Customer Equity and exchange traded fund (‘‘ETF’’) option ADV (‘‘TCADV’’).6 The Exchange believes this proposed modification would enable Market Makers to achieve the Discount more consistently, despite monthly or seasonal fluctuations in industry volume. The Exchange is not proposing to adjust the source of the qualifying volume for each component of the Discount, as this criterion will remain the same. Specifically, the Exchange proposes the market share requirements for achieving the Discount as follows: ‘‘An LMM with daily contract volume traded electronically of at least 0.40% Total Industry Customer equity and ETF option ADV (‘TCADV’), of which 0.08% TCADV are within its LMM appointment, will be charged 50% of the monthly Lead Market Maker Rights Fee.’’ 7 The Exchange notes that the TCADV percentages proposed are a 4 See Fee Schedule, available here, https:// www.nyse.com/publicdocs/nyse/markets/arcaoptions/NYSE_Arca_Options_Fee_Schedule.pdf (NYSE Arca General Options and Trading Permit (OTP) Fee, Lead Market Maker Rights Fee). 5 See id., endnote 2. 6 The volume thresholds are based on Market Makers’ volume transacted electronically as a percentage of total industry Customer equity and ETF options volumes as reported by the Options Clearing Corporation (the ‘‘OCC’’). Total industry Customer equity and ETF option volume is comprised of those equity and ETF contracts that clear in the Customer account type at OCC and does not include contracts that clear in either the Firm or Market Maker account type at OCC or contracts overlying a security other than an equity or ETF security. See OCC Monthly Statistics Reports, available here, https://www.theocc.com/webapps/ monthly-volume-reports. 7 See proposed Fee Schedule, endnote 2. E:\FR\FM\07JNN1.SGM 07JNN1 Federal Register / Vol. 82, No. 108 / Wednesday, June 7, 2017 / Notices rough equivalent to the existing 50,000 and 10,000 ADV contract thresholds, based on TCADV for the First Quarter of 2017. The Exchange is not proposing any changes to the amount of the LMM Rights Fees or any of the other available per issue discounts to the LMM Rights Fee. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,8 in general, and furthers the objectives of Sections 6(b)(4) and (5) of the Act,9 in particular, because it provides for the equitable allocation of reasonable dues, fees, and other charges among its members, issuers and other persons using its facilities and does not unfairly discriminate between customers, issuers, brokers or dealers. The Exchange believes that modifying the qualification calculation for the Discount from a static monthly contract amount to a percentage of TCADV is reasonable, equitable, and not unfairly discriminatory because it would make the Discount more consistently achievable as the calculation will be more aligned with fluctuations in overall monthly industry volume. The Exchange believes the proposed change is not unfairly discriminatory because the proposed benchmark of TCADV is tied to the amount of monthly volume executed on the Exchange, which would incentivize and reward consistent order flow month-to-month. The Exchange notes that other options exchanges likewise utilize percentages of market share as a benchmark in determining eligibility for monthly [sic] certain credits or rebates.10 The Exchange also believes the proposed change would help to prevent LMMs from achieving the Discount only during periods of heavy volumes or from being penalized (i.e., not achieving the Discount) during months of overall lower volumes on the 8 15 U.S.C. 78f(b). U.S.C. 78f(b)(4) and (5). 10 See, e.g., Fee Schedule, supra note 4 (Customer and Professional Customer Monthly Posting Credit Tiers and Qualifications for Executions in Penny Pilot Issues and Customer and Professional Customer Posting Credit Tiers In Non Penny Pilot Issues, both based on percentage of TCADV); NASDAQ Options Market fee schedule, available at, https://www.nasdaqtrader.com/ Micro.aspx?id=optionsPricing (NOM Market Maker Rebate to Add Liquidity in Penny Pilot Options based on total industry customer equity and ETF option ADV contracts per day in a month); BATS Options Exchange fee schedule, available at, https:// www.batsoptions.com/support/fee_schedule/ (Market Maker and Non-BATS Market Maker Penny Pilot Add Volume Tiers Market Maker and NonBATS Market Maker Non Penny Pilot Add Volume Tiers, both based on percentage of total consolidated monthly volume calculated). sradovich on DSK3GMQ082PROD with NOTICES 9 15 VerDate Sep<11>2014 16:37 Jun 06, 2017 Jkt 241001 26533 Exchange. The Exchange notes that there is only one LMM per issue, and only LMMs are subject to the LMM Rights Fee, therefore the proposed discount is not unfairly discriminatory. For these reasons, the Exchange believes that the proposal is consistent with the Act. Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B) 14 of the Act to determine whether the proposed rule change should be approved or disapproved. B. Self-Regulatory Organization’s Statement on Burden on Competition 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: In accordance with Section 6(b)(8) of the Act,11 the Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. By adjusting the qualifications to a market share basis rather than per contract volume levels, the Exchange believes the proposed change encourages competition without undue burden by being based on a share of overall business rather than a static volume amount. The Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues. In such an environment, the Exchange must continually review, and consider adjusting, its fees and credits to remain competitive with other exchanges. For the reasons described above, the Exchange believes that the proposed rule change reflects this competitive environment. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change is effective upon filing pursuant to Section 19(b)(3)(A) 12 of the Act and subparagraph (f)(2) of Rule 19b–4 13 thereunder, because it establishes a due, fee, or other charge imposed by the Exchange. At any time within 60 days of the filing of such 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. If the 11 15 U.S.C. 78f(b)(8). U.S.C. 78s(b)(3)(A). 13 17 CFR 240.19b–4(f)(2). IV. Solicitation of Comments Electronic Comments • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– NYSEArca–2017–61 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–NYSEArca–2017–61. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s Internet Web site (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for Web site viewing and printing in the Commission’s Public Reference Room, 100 F Street NE., Washington, DC 20549 on official business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of such filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions 12 15 PO 00000 Frm 00111 Fmt 4703 Sfmt 4703 14 15 E:\FR\FM\07JNN1.SGM U.S.C. 78s(b)(2)(B). 07JNN1 26534 Federal Register / Vol. 82, No. 108 / Wednesday, June 7, 2017 / Notices should refer toFile Number SR– NYSEArca–2017–61, and should be submitted on or before June 28, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.15 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–11749 Filed 6–6–17; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–80840; File No. SR– NYSEArca–2017–33] Self-Regulatory Organizations; NYSE Arca, Inc.; Order Approving a Proposed Rule Change, as Modified by Amendment No. 2 Thereto, To List and Trade Shares of the Euro Gold Trust, Pound Gold Trust, and the Yen Gold Trust Under NYSE Arca Equities Rule 8.201 June 1, 2017. I. Introduction On March 31, 2017, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘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 Euro Gold Trust, Pound Gold Trust, and the Yen Gold Trust (each a ‘‘Fund’’ and, collectively, the ‘‘Funds’’) under NYSE Arca Equities Rule 8.201. On April 12, 2017, the Exchange filed Amendment No. 1 to the proposal, which amended and replaced the proposed rule change in its entirety. The proposed rule change, as modified by Amendment No. 1, was published for comment in the Federal Register on April 19, 2017.3 On May 23, 2017, the Exchange filed Amendment No. 2 to the proposed rule change,4 which amended 15 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 80457 (April 13, 2017), 82 FR 18492. 4 In Amendment No. 2, the Exchange: (1) Described further the methodology for each underlying index; (2) provided additional information regarding Solactive AG, the ‘‘Index Provider;’’ (3) further supported its position that market makers in the Shares will be able to trade the Shares at prices that are not at a material discount or premium to net asset value (‘‘NAV’’) per Share; and (4) made additional statements regarding the continued listing requirements applicable to the Shares. The amendments to the proposed rule change are available at: https://www.sec.gov/ comments/sr-nysearca-2017-33/ nysearca201733.htm. Amendment No. 2 is not subject to notice and comment because it is a sradovich on DSK3GMQ082PROD with NOTICES 1 15 VerDate Sep<11>2014 16:37 Jun 06, 2017 Jkt 241001 and replaced the proposed rule change as modified by Amendment No. 1. The Commission has not received any comments on the proposed rule change. This order approves the proposed rule change, as modified by Amendment No. 2. II. The Description of the Proposed Rule Change, as Modified by Amendment No. 2 5 The Exchange proposes to list and trade the Shares, which are a series of the World Currency Gold Trust (‘‘Trust’’), under NYSE Arca Equities Rule 8.201.6 Under NYSE Arca Equities Rule 8.201, the Exchange may list and trade, or trade pursuant to unlisted trading privileges, Commodity-Based Trust Shares.7 The Sponsor of the Funds and the Trust will be WGC USA Asset Management Company, LLC (‘‘Sponsor’’).8 BNY Mellon Asset Servicing, a division of The Bank of New York Mellon (‘‘BNYM’’), will be the Funds’ administrator (‘‘Administrator’’) and transfer agent and will not be affiliated with the Trust, the Funds, or the Sponsor. BNYM will also serve as the custodian of the Funds’ cash, if any. HSBC Bank plc will be the custodian of the Funds’ gold. The Euro Gold Trust will be designed to track the performance of the Solactive GLD® EUR Gold Index, less the expenses of the Fund’s operations. The Solactive GLD® EUR Gold Index seeks to track the daily performance of a long position in physical gold (as represented by the Gold Price, which generally is the London Bullion Markets Association technical amendment that does not materially alter the substance of the proposed rule change or raise any novel regulatory issues. 5 A more detailed description of the Funds, the Shares, the Indexes and the Gold Delivery Agreement (as defined in the Notice), as well as investment risks, creation and redemption procedures, NAV calculation, availability of values and other information regarding the Funds, and fees, among other things, is included in the Registration Statement, infra note 6, and Amendment No. 2, supra note 4. 6 On March 30, 2017, the Trust filed with the Commission its initial registration statement on Form S–1 under the Securities Act of 1933 relating to the Funds (File No. 333–217041) (‘‘Registration Statement’’). 7 Commodity-Based Trust Shares are securities issued by a trust that represent investors’ discrete identifiable and undivided beneficial ownership interest in the commodities deposited into the Trust. 8 The Trust will be a Delaware statutory trust consisting of multiple series, each of which will issue common units of beneficial interest, which represent units of fractional undivided beneficial interest in and ownership of such series. The term of the Trust and each series will be perpetual (unless terminated earlier in certain circumstances). The sole trustee of the Trust will be Delaware Trust Company. PO 00000 Frm 00112 Fmt 4703 Sfmt 4703 (‘‘LBMA’’) Gold Price AM 9) and a short position in the Euro (i.e., a long U.S. dollar (‘‘USD’’) exposure versus the Euro). The Pound Gold Trust will be designed to track the performance of the Solactive GLD® GBP Gold Index, less the expenses of the Fund’s operations. The Solactive GLD® GBP Gold Index seeks to track the daily performance of a long position in physical gold (as represented by the Gold Price) and a short position in the British Pound Sterling (i.e., a long USD exposure versus the British Pound Sterling). The Yen Gold Trust will be designed to track the performance of the Solactive GLD® JPY Gold Index, less the expenses of the Fund’s operations. The Solactive GLD® JPY Gold Index seeks to track the daily performance of a long position in physical gold (as represented by the Gold Price) and a short position in the Japanese Yen (i.e., a long USD exposure versus the Japanese Yen). The Japanese Yen, the Euro and the British Pound Sterling are referred to collectively as the ‘‘Reference Currencies.’’ Each of the Solactive GLD® EUR Gold Index, Solactive GLD® GBP Gold Index, and Solactive GLD® JPY Gold Index are each referred to as an ‘‘Index,’’ and are referred to collectively as the ‘‘Indexes.’’ Generally, each Fund’s holdings will consist entirely of Gold Bullion.10 Substantially all of each Fund’s Gold Bullion holdings will delivered by Authorized Participants 11 in exchange for Fund Shares. The Funds’ Gold Bullion holdings will not be managed and the Funds will not have any investment discretion. The Funds will not hold their respective Reference Currencies. The Funds generally will not hold USDs (except from time to time in very limited amounts to pay Fund expenses). 9 The ‘‘LBMA Gold Price’’ means the price per troy ounce of gold stated in USDs as set via an electronic auction process run twice daily at 10:30 a.m. and 3:00 p.m. London time each Business Day as calculated and administered by the ICE Benchmark Administration Limited and published by the LBMA on its Web site. The ‘‘LBMA Gold Price AM’’ is the 10:30 a.m. LBMA Gold Price. See Amendment No. 2, supra note 4, at 8–9. 10 Gold Bullion means (a) gold meeting the requirements of ‘‘London Good Delivery Standards’’ or (b) credit to an ‘‘Unallocated Account’’ representing the right to receive Gold Bullion meeting the requirements of London Good Delivery Standards. London Good Delivery Standards are the specifications for weight dimensions, fineness (or purity), identifying marks and appearance set forth in ‘‘The Good Delivery Rules for Gold and Silver Bars’’ published by the LBMA. See id. at 6, n.19. 11 According to the Exchange, Authorized Participants are the only persons that may place orders to create and redeem Creation Units and such persons must enter into a Participant Agreement. See id. at 18. E:\FR\FM\07JNN1.SGM 07JNN1

Agencies

[Federal Register Volume 82, Number 108 (Wednesday, June 7, 2017)]
[Notices]
[Pages 26532-26534]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-11749]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80838; File No. SR-NYSEArca-2017-61]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the NYSE 
Arca Options Fee Schedule

June 1, 2017.
    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 May 31, 2017, NYSE Arca, Inc. (the ``Exchange'' or 
``NYSE Arca'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I, II, 
and III 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of the 
Substance of the Proposed Rule Change

    The Exchange proposes to amend the NYSE Arca Options Fee Schedule 
(``Fee Schedule'') with respect to the Lead Market Maker (``LMM'') 
Rights Fee. The Exchange proposes to implement the fee change effective 
June 1, 2017. The proposed rule change is available on the Exchange's 
Web site at www.nyse.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 those 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 purpose of this filing is to modify the calculation of the 
threshold for qualification for the LMM Rights Fee discount.
    The LMM Rights Fee is charged ``on a per issue basis to the OTP 
Firm acting as LMM in the issue.'' \4\ The Exchange charges a Rights 
Fee on each issue in a LMM's allocation, with rates based on the 
Average National Daily Customer Contracts. LMMs are also able to 
achieve a 50% discount to their total monthly LMM Rights Fee by 
achieving an average daily volume (``ADV'') of 50,000 contracts, of 
which at least 10,000 are within its LMM Appointment (the 
``Discount'').\5\
---------------------------------------------------------------------------

    \4\ See Fee Schedule, available here, https://www.nyse.com/publicdocs/nyse/markets/arca-options/NYSE_Arca_Options_Fee_Schedule.pdf (NYSE Arca General Options and 
Trading Permit (OTP) Fee, Lead Market Maker Rights Fee).
    \5\ See id., endnote 2.
---------------------------------------------------------------------------

    The Exchange proposes to replace the static minimum contract 
thresholds of 50,000 and 10,000 with market share criteria expressed as 
a percentage of Total Industry Customer Equity and exchange traded fund 
(``ETF'') option ADV (``TCADV'').\6\ The Exchange believes this 
proposed modification would enable Market Makers to achieve the 
Discount more consistently, despite monthly or seasonal fluctuations in 
industry volume. The Exchange is not proposing to adjust the source of 
the qualifying volume for each component of the Discount, as this 
criterion will remain the same.
---------------------------------------------------------------------------

    \6\ The volume thresholds are based on Market Makers' volume 
transacted electronically as a percentage of total industry Customer 
equity and ETF options volumes as reported by the Options Clearing 
Corporation (the ``OCC''). Total industry Customer equity and ETF 
option volume is comprised of those equity and ETF contracts that 
clear in the Customer account type at OCC and does not include 
contracts that clear in either the Firm or Market Maker account type 
at OCC or contracts overlying a security other than an equity or ETF 
security. See OCC Monthly Statistics Reports, available here, https://www.theocc.com/webapps/monthly-volume-reports.
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    Specifically, the Exchange proposes the market share requirements 
for achieving the Discount as follows: ``An LMM with daily contract 
volume traded electronically of at least 0.40% Total Industry Customer 
equity and ETF option ADV (`TCADV'), of which 0.08% TCADV are within 
its LMM appointment, will be charged 50% of the monthly Lead Market 
Maker Rights Fee.'' \7\ The Exchange notes that the TCADV percentages 
proposed are a

[[Page 26533]]

rough equivalent to the existing 50,000 and 10,000 ADV contract 
thresholds, based on TCADV for the First Quarter of 2017.
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    \7\ See proposed Fee Schedule, endnote 2.
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    The Exchange is not proposing any changes to the amount of the LMM 
Rights Fees or any of the other available per issue discounts to the 
LMM Rights Fee.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\8\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\9\ in particular, 
because it provides for the equitable allocation of reasonable dues, 
fees, and other charges among its members, issuers and other persons 
using its facilities and does not unfairly discriminate between 
customers, issuers, brokers or dealers.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    The Exchange believes that modifying the qualification calculation 
for the Discount from a static monthly contract amount to a percentage 
of TCADV is reasonable, equitable, and not unfairly discriminatory 
because it would make the Discount more consistently achievable as the 
calculation will be more aligned with fluctuations in overall monthly 
industry volume. The Exchange believes the proposed change is not 
unfairly discriminatory because the proposed benchmark of TCADV is tied 
to the amount of monthly volume executed on the Exchange, which would 
incentivize and reward consistent order flow month-to-month. The 
Exchange notes that other options exchanges likewise utilize 
percentages of market share as a benchmark in determining eligibility 
for monthly [sic] certain credits or rebates.\10\ The Exchange also 
believes the proposed change would help to prevent LMMs from achieving 
the Discount only during periods of heavy volumes or from being 
penalized (i.e., not achieving the Discount) during months of overall 
lower volumes on the Exchange. The Exchange notes that there is only 
one LMM per issue, and only LMMs are subject to the LMM Rights Fee, 
therefore the proposed discount is not unfairly discriminatory.
---------------------------------------------------------------------------

    \10\ See, e.g., Fee Schedule, supra note 4 (Customer and 
Professional Customer Monthly Posting Credit Tiers and 
Qualifications for Executions in Penny Pilot Issues and Customer and 
Professional Customer Posting Credit Tiers In Non Penny Pilot 
Issues, both based on percentage of TCADV); NASDAQ Options Market 
fee schedule, available at, https://www.nasdaqtrader.com/Micro.aspx?id=optionsPricing (NOM Market Maker Rebate to Add 
Liquidity in Penny Pilot Options based on total industry customer 
equity and ETF option ADV contracts per day in a month); BATS 
Options Exchange fee schedule, available at, https://www.batsoptions.com/support/fee_schedule/ (Market Maker and Non-BATS 
Market Maker Penny Pilot Add Volume Tiers Market Maker and Non-BATS 
Market Maker Non Penny Pilot Add Volume Tiers, both based on 
percentage of total consolidated monthly volume calculated).
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    For these reasons, the Exchange believes that the proposal is 
consistent with the Act.

B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with Section 6(b)(8) of the Act,\11\ the Exchange 
does not believe that the proposed rule change will impose any burden 
on competition that is not necessary or appropriate in furtherance of 
the purposes of the Act. By adjusting the qualifications to a market 
share basis rather than per contract volume levels, the Exchange 
believes the proposed change encourages competition without undue 
burden by being based on a share of overall business rather than a 
static volume amount.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    The Exchange notes that it operates in a highly competitive market 
in which market participants can readily favor competing venues. In 
such an environment, the Exchange must continually review, and consider 
adjusting, its fees and credits to remain competitive with other 
exchanges. For the reasons described above, the Exchange believes that 
the proposed rule change reflects this competitive environment.

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

    No written comments were solicited or received with respect to the 
proposed rule change.

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

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \12\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \13\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such 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. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \14\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \14\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

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-NYSEArca-2017-61 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-NYSEArca-2017-61. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549 on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of such filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions

[[Page 26534]]

should refer to File Number SR-NYSEArca-2017-61, and should be 
submitted on or before June 28, 2017.
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    \15\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-11749 Filed 6-6-17; 8:45 am]
 BILLING CODE 8011-01-P
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