Self-Regulatory Organizations; Cboe BYX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees, 28472-28474 [2018-13085]
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28472
Federal Register / Vol. 83, No. 118 / Tuesday, June 19, 2018 / Notices
daltland on DSKBBV9HB2PROD with NOTICES
(3) Publish notice of the computer
matching program in the Federal
Register;
(4) Furnish detailed reports about
matching programs to Congress and
OMB;
(5) Notify applicants and beneficiaries
that their records are subject to
matching; and
(6) Verify match findings before
reducing, suspending, terminating, or
denying a person’s benefits or
payments. The last notice for this
matching program was published in the
Federal Register on November 9, 2015
(80 FR 69253).
Participating agencies: Railroad
Retirement Board (RRB) and the Social
Security Administration (SSA), Match
#1007.
Authority for conducting the
matching program: Section 7(b)(7) of the
Railroad Retirement Act (45 U.S.C.
231f(b)(7)) provides that the Social
Security Administration shall supply
information necessary to administer the
Railroad Retirement Act. Sections 202,
205(o) and 215(f) of the Social Security
Act (42 U.S.C. 402, 405(o) and 415(f))
relate to benefit provisions, inclusion of
railroad compensation together with
wages for payment of benefits under
certain circumstances, and the recomputation of benefits.
Purposes
1. Daily exchanges:
a. The RRB will obtain from SSA a
record of the wages reported to SSA for
persons who have applied for benefits
under the Railroad Retirement Act and
a record of the amount of benefits paid
by that agency to persons who are
receiving or have applied for benefits
under the Railroad Retirement Act. The
wage information is needed to compute
the amount of the tier I annuity
component provided by sections 3(a),
4(a) and 4(f) of the Railroad Retirement
Act (45 U.S.C. 231b(a), 45 U.S.C. 231c(a)
and 45 U.S.C. 231c(f)). The benefit
information is needed to adjust the tier
I annuity component for the receipt of
the Social Security benefit. This
information is available from no other
source.
b. The RRB will receive from SSA the
amount of certain social security
benefits which the RRB pays on behalf
of SSA. Section 7(b)(2) of the Railroad
Retirement Act (45 U.S.C. 231f(b)(2))
provides that the RRB shall make the
payment of certain social security
benefits. The RRB also requires this
information in order to adjust the
amount of any annuity due to the
receipt of a social security benefit.
Section 10(a) of the Railroad Retirement
Act (45 U.S.C. 231i(a)) permits the RRB
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17:55 Jun 18, 2018
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to recover any overpayment from the
accrual of social security benefits. This
information is not available from any
other source.
c. The SSA will receive from RRB
earnings information on selected
individuals. The transfer of information
may be initiated either by RRB or by
SSA. SSA needs this information to
determine eligibility to Social Security
benefits and, if eligibility is met, to
determine the benefit amount payable.
Section 18 of the Railroad Retirement
Act (45 U.S.C. 231q(2)) requires that
earnings considered as compensation
under the Railroad Retirement Act be
considered as wages under the Social
Security Act for the purposes of
determining entitlement under the
Social Security Act if the person has
less than 10 years of railroad service or
has 10 or more years of service but does
not have a current connection with the
railroad industry at the time of his/her
death.
2. Weekly exchange: The SSA will
receive from the RRB earnings
information for all railroad employees.
SSA will match the identifying
information of the records furnished by
the RRB against the identifying
information contained in its Master
Benefit Record and its Master Earnings
File. If there is a match, SSA will use
the RRB earnings to adjust the amount
of Social Security benefits in its Annual
Earnings Reappraisal Operation. This
information is available from no other
source.
Yearly exchange: The RRB will
receive from SSA a copy of SSA’s
Master Benefit Record for earmarked
RRB annuitants. Section 7(b)(7)) of the
Railroad Retirement Act (45 U.S.C.
231f(b)(7)) requires that SSA provide the
requested information. The RRB needs
this information to make the necessary
cost-of-living computation adjustments
quickly and accurately for those RRB
annuitants who are also SSA
beneficiaries.
Categories of individuals: All
applicants for benefits under the
Railroad Retirement Act and current
beneficiaries will have a record of any
social security wages and the amount of
any social security benefits furnished to
the RRB by SSA. In addition, all persons
who ever worked in the railroad
industry after 1936 will have a record of
their service and compensation
furnished to SSA by RRB.
Systems of records: The applicable
RRB Privacy Act Systems of Records
and their Federal Register citation used
in the matching program are:
1. RRB–5, Master File of Railroad
Employees’ Creditable Compensation,
September 30, 2014 (79 FR 58877)
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2. RRB–22, Railroad Retirement,
Survivor, and Pensioner Benefit System,
May 15, 2015 (80 FR 28018)
The applicable SSA Privacy Act
Systems of Records used and their
Federal Register citation used in the
matching program are:
1. SSA 60–0058, Master Files of
Social Security Number (SSN) Holders
and SSN Applications (the Enumeration
System), last published on December 29,
2010 (75 FR 82121), July 5, 2013 (78 FR
40542), and February 13, 2014 (79 FR
8780).
2. SSA/OS, 60–0059, Earnings
Recording and Self-Employment Income
System (MEF), last published on
January 11, 2006 (71 FR 1819), July 5,
2013 (78 FR 40542).
3. SSA/ORSIS 60–0090, Master
Beneficiary Record (MBR), last
published on January 11, 2006 (71 FR
1826), December 10, 2007 (72 FR
69723), and July 5, 2013 (78 FR 40542).
4. SSA/ODISSIS 60–103,
Supplemental Security Income Record
and Special Veteran Benefits last
published on January 11, 2006 (71 FR
1830), December 10, 2007 (72 FR
69723).
5. SSA/OPB 60–0269, Prisoner
Update Processing System (PUPS), last
published on March 8, 1999 (64 FR
11076), December 10, 2007 (72 FR
69723), and July 5, 2013 (78 FR 40542).
Dated: June 14, 2018.
By authority of the Board.
Martha Rico-Parra,
Secretary to the Board.
[FR Doc. 2018–13103 Filed 6–18–18; 8:45 am]
BILLING CODE 7905–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–83426; File No. SR–
CboeBYX–2018–007]
Self-Regulatory Organizations; Cboe
BYX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change Related to Fees
June 13, 2018.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934,1 and
Rule 19b–4 thereunder,2 notice is
hereby given that on June 1, 2018, Cboe
BYX Exchange, Inc. (‘‘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
1 15
2 17
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
19JNN1
Federal Register / Vol. 83, No. 118 / Tuesday, June 19, 2018 / Notices
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 website at
www.markets.cboe.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
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1. Purpose
The Exchange proposes to amend its
fee schedule applicable to its equities
trading platform (‘‘BYX Equities’’) to (i)
eliminate Add Volume Tier 6 and (ii)
modify criteria in certain Add and
Remove Volume Tiers, effective June 1,
2018.
By way of background, for orders that
yield fee codes B, V, and Y, the
Exchange assesses a standard
transaction fee of $0.0019 per share for
orders that add liquidity for securities at
or above $1.00. The Exchange also
currently offers six tiers under footnote
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).
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1 that offer reduced fees for orders that
add liquidity yielding fee codes B, V,
and Y. The Exchange first proposes to
eliminate Add Volume Tier 6. Add
Volume Tier 6 currently provides
Members a reduced fee of $0.0017 per
share where a MPID (i) has an ADAV 6
of greater than or equal to 0.10% of the
TCV 7 and (ii) has a Step-Up ADAV 8 of
greater or equal to 0.05% of the TCV
from September 2017 baseline. The
Exchange no longer wishes to maintain
this tier level. As such, the Exchange
proposes to eliminate Add Volume Tier
6 from the Fees Schedule and renumber
the subsequent Volume Tiers
accordingly.
The Exchange next proposes to
modify the criteria for Add Volume
Tiers 2 and 3. Pursuant to Add Volume
Tier 2, a Member will be assessed a
reduced fee of $0.0013 per share where
a Member adds an ADAV greater than
or equal to 0.40% of the TCV. The
Exchange proposes to increase the
ADAV requirement to greater than or
equal to 0.45% of the TCV. Pursuant to
Add Volume Tier 3, a Member will be
assessed a reduced fee of $0.0012 per
share where a Member adds an ADAV
greater than or equal to 0.80% of the
TCV. The Exchange proposes to increase
the ADAV requirement to greater than
or equal to 1.00% of the TCV.
The Exchange next proposes to
modify the criteria for Remove Volume
Tiers 8 and 9. Currently, for orders that
yield fee codes N, W, and BB, the
Exchange provides a rebate of $0.0005
per share for orders that remove
liquidity for securities at or above $1.00.
The Exchange currently offers four tiers
under footnote 1 that offer enhanced
rebates for orders that remove liquidity
yielding fee codes BB, N, and W.
Pursuant to Remove Volume Tier 8
(proposed to be renumbered to Remove
Volume Tier 7), a Member will receive
an enhanced rebate of $0.0016 per share
where a Member (i) has a Step-Up
Remove 9 TCV from July 2017 greater
than or equal to 0.05% and (ii) has a
6 ‘‘ADAV’’ means average daily volume calculated
as the number of shares added per day. ADAV is
calculated on a monthly basis. See BYX Equities
Exchange Fee Schedule.
7 ‘‘TCV’’ means total consolidated volume
calculated as the volume reported by all exchanges
and trade reporting facilities to a consolidated
transaction reporting plan for the month for which
the fees apply. See BYX Equities Exchange Fee
Schedule.
8 ‘‘Step-Up ADAV’’ means ADAV in the relevant
baseline month subtracted from current ADAV. See
BYX Equities Exchange Fee Schedule.
9 ‘‘Step-Up Remove TCV’’ means remove ADV as
a percentage of TCV in the relevant baseline month
subtracted from current remove ADV as a
percentage of TCV. See BYX Equities Exchange Fee
Schedule.
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28473
remove ADV 10 greater than or equal to
0.20% of TCV. The Exchange proposes
to modify the second prong to increase
the ADV requirement to greater than or
equal to 0.25% of the TCV.
Pursuant to Remove Volume Tier 9
(proposed to be renumbered Remove
Volume Tier 8), a Member will receive
an enhanced rebate of $0.0017 per share
where a Member (i) has a Step-Up
Remove TCV from December 2017
greater than or equal to 0.075% and (ii)
has an ADV greater than or equal to
0.10% of TCV. The Exchange proposes
to modify the first prong to increase the
Step-Up Remove TCV from 0.075% to
0.10% of TCV. The Exchange notes that
the modification to the first prong
renders the second prong unnecessary,
as the second prong criteria will always
be met if the proposed first prong
criteria is met. The Exchange therefore
proposes to eliminate the second prong
of Remove Volume Tier 9.
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the
Securities Exchange Act of 1934 (the
‘‘Act’’) and the rules and regulations
thereunder applicable to the Exchange
and, in particular, the requirements of
Section 6(b) of the Act.11 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 12 requirements that the rules of
an exchange be designed to prevent
fraudulent and manipulative acts and
practices, to promote just and equitable
principles of trade, to foster cooperation
and coordination with persons engaged
in regulating, clearing, settling,
processing information with respect to,
and facilitating transactions in
securities, to remove impediments to
and perfect the mechanism of a free and
open market and a national market
system, and, in general, to protect
investors and the public interest.
Additionally, the Exchange believes the
proposed rule change is consistent with
Section 6(b)(4) of the Act,13 which
requires that Exchange rules provide for
the equitable allocation of reasonable
dues, fees, and other charges among its
Members and other persons using its
facilities.
The Exchange believes that the
proposal to eliminate Add Volume Tier
6 is reasonable, fair, and equitable
because the current tier is not providing
the desired result of incentivizing
10 ‘‘ADV’’ means average daily volume calculated
as the number of shares added or removed,
combined, per day. ADV is calculated on a monthly
basis. See BYX Equities Exchange Fee Schedule.
11 15 U.S.C. 78f(b).
12 15 U.S.C. 78f(b)(5).
13 15 U.S.C. 78f(b)(4).
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28474
Federal Register / Vol. 83, No. 118 / Tuesday, June 19, 2018 / Notices
Members to increase their participation
in BYX Equities. Therefore, eliminating
the tier will have a negligible effect on
order flow and market behavior. The
Exchange believes the proposed change
is not unfairly discriminatory because it
will apply equally to all Members.
The Exchange next notes that volumebased discounts such as those currently
maintained on the Exchange have been
widely adopted by exchanges and are
equitable and non-discriminatory
because they are open to all Members on
an equal basis and provide additional
benefits or discounts that are reasonably
related to the value of 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. While
the proposed modification to Add/
Remove Volume Tiers 2, 3, 8 and 9
makes such tiers slightly more difficult
to attain, it is intended to incentivize
Members to send additional volume to
the Exchange in an effort to qualify or
continue to qualify for the reduced fees
and enhanced rebates, as applicable,
made available by the tiers. As such, the
Exchange also believes that the
proposed changes are reasonable. The
Exchange notes that increased volume
on the Exchange provides greater
trading opportunities for all market
participants.
daltland on DSKBBV9HB2PROD with NOTICES
(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 that any of
the proposed change to the Exchange’s
tiered pricing structure burden
competition, but instead, that they
enhance competition as they are
intended to increase the
competitiveness of BYX by modifying
pricing incentives in order to attract
order flow and incentivize participants
to increase their participation on the
Exchange. The Exchange notes that it
operates in a highly competitive market
in which market participants can
readily direct order flow to competing
venues if they deem fee structures to be
unreasonable or excessive. The
Exchange does not believe the proposed
amendments would burden intramarket
competition as they would be available
to all Members uniformly.
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17:55 Jun 18, 2018
Jkt 244001
(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
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 14 and paragraph (f) of Rule
19b–4 thereunder.15 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:
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–
CboeBYX–2018–007 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–CboeBYX–2018–007. 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 website (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 website 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.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–CboeBYX–2018–007 and
should be submitted on or before July
10, 2018.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018–13085 Filed 6–18–18; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–83421; File No. SR–
NASDAQ–2018–044]
Self-Regulatory Organizations; The
Nasdaq Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend The
Nasdaq Options Market LLC (‘‘NOM’’)
Rules at Supplementary Material to
Chapter III, Section 7, Entitled
‘‘Position Limits,’’ and Section 9,
Entitled ‘‘Exercise Limits’’
June 13, 2018.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on June 11,
2018, The Nasdaq Stock Market LLC
(‘‘Nasdaq’’ or ‘‘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
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
16 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
14 15
U.S.C. 78s(b)(3)(A).
15 17 CFR 240.19b–4(f).
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Agencies
[Federal Register Volume 83, Number 118 (Tuesday, June 19, 2018)]
[Notices]
[Pages 28472-28474]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-13085]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-83426; File No. SR-CboeBYX-2018-007]
Self-Regulatory Organizations; Cboe BYX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change Related to
Fees
June 13, 2018.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of
1934,\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that on
June 1, 2018, Cboe BYX Exchange, Inc. (``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
[[Page 28473]]
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).
---------------------------------------------------------------------------
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
website at www.markets.cboe.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 its
equities trading platform (``BYX Equities'') to (i) eliminate Add
Volume Tier 6 and (ii) modify criteria in certain Add and Remove Volume
Tiers, effective June 1, 2018.
By way of background, for orders that yield fee codes B, V, and Y,
the Exchange assesses a standard transaction fee of $0.0019 per share
for orders that add liquidity for securities at or above $1.00. The
Exchange also currently offers six tiers under footnote 1 that offer
reduced fees for orders that add liquidity yielding fee codes B, V, and
Y. The Exchange first proposes to eliminate Add Volume Tier 6. Add
Volume Tier 6 currently provides Members a reduced fee of $0.0017 per
share where a MPID (i) has an ADAV \6\ of greater than or equal to
0.10% of the TCV \7\ and (ii) has a Step-Up ADAV \8\ of greater or
equal to 0.05% of the TCV from September 2017 baseline. The Exchange no
longer wishes to maintain this tier level. As such, the Exchange
proposes to eliminate Add Volume Tier 6 from the Fees Schedule and
renumber the subsequent Volume Tiers accordingly.
---------------------------------------------------------------------------
\6\ ``ADAV'' means average daily volume calculated as the number
of shares added per day. ADAV is calculated on a monthly basis. See
BYX Equities Exchange Fee Schedule.
\7\ ``TCV'' means total consolidated volume calculated as the
volume reported by all exchanges and trade reporting facilities to a
consolidated transaction reporting plan for the month for which the
fees apply. See BYX Equities Exchange Fee Schedule.
\8\ ``Step-Up ADAV'' means ADAV in the relevant baseline month
subtracted from current ADAV. See BYX Equities Exchange Fee
Schedule.
---------------------------------------------------------------------------
The Exchange next proposes to modify the criteria for Add Volume
Tiers 2 and 3. Pursuant to Add Volume Tier 2, a Member will be assessed
a reduced fee of $0.0013 per share where a Member adds an ADAV greater
than or equal to 0.40% of the TCV. The Exchange proposes to increase
the ADAV requirement to greater than or equal to 0.45% of the TCV.
Pursuant to Add Volume Tier 3, a Member will be assessed a reduced fee
of $0.0012 per share where a Member adds an ADAV greater than or equal
to 0.80% of the TCV. The Exchange proposes to increase the ADAV
requirement to greater than or equal to 1.00% of the TCV.
The Exchange next proposes to modify the criteria for Remove Volume
Tiers 8 and 9. Currently, for orders that yield fee codes N, W, and BB,
the Exchange provides a rebate of $0.0005 per share for orders that
remove liquidity for securities at or above $1.00. The Exchange
currently offers four tiers under footnote 1 that offer enhanced
rebates for orders that remove liquidity yielding fee codes BB, N, and
W. Pursuant to Remove Volume Tier 8 (proposed to be renumbered to
Remove Volume Tier 7), a Member will receive an enhanced rebate of
$0.0016 per share where a Member (i) has a Step-Up Remove \9\ TCV from
July 2017 greater than or equal to 0.05% and (ii) has a remove ADV \10\
greater than or equal to 0.20% of TCV. The Exchange proposes to modify
the second prong to increase the ADV requirement to greater than or
equal to 0.25% of the TCV.
---------------------------------------------------------------------------
\9\ ``Step-Up Remove TCV'' means remove ADV as a percentage of
TCV in the relevant baseline month subtracted from current remove
ADV as a percentage of TCV. See BYX Equities Exchange Fee Schedule.
\10\ ``ADV'' means average daily volume calculated as the number
of shares added or removed, combined, per day. ADV is calculated on
a monthly basis. See BYX Equities Exchange Fee Schedule.
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Pursuant to Remove Volume Tier 9 (proposed to be renumbered Remove
Volume Tier 8), a Member will receive an enhanced rebate of $0.0017 per
share where a Member (i) has a Step-Up Remove TCV from December 2017
greater than or equal to 0.075% and (ii) has an ADV greater than or
equal to 0.10% of TCV. The Exchange proposes to modify the first prong
to increase the Step-Up Remove TCV from 0.075% to 0.10% of TCV. The
Exchange notes that the modification to the first prong renders the
second prong unnecessary, as the second prong criteria will always be
met if the proposed first prong criteria is met. The Exchange therefore
proposes to eliminate the second prong of Remove Volume Tier 9.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\11\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \12\ requirements that the rules of an exchange be
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest. Additionally,
the Exchange believes the proposed rule change is consistent with
Section 6(b)(4) of the Act,\13\ which requires that Exchange rules
provide for the equitable allocation of reasonable dues, fees, and
other charges among its Members and other persons using its facilities.
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\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(5).
\13\ 15 U.S.C. 78f(b)(4).
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The Exchange believes that the proposal to eliminate Add Volume
Tier 6 is reasonable, fair, and equitable because the current tier is
not providing the desired result of incentivizing
[[Page 28474]]
Members to increase their participation in BYX Equities. Therefore,
eliminating the tier will have a negligible effect on order flow and
market behavior. The Exchange believes the proposed change is not
unfairly discriminatory because it will apply equally to all Members.
The Exchange next notes that volume-based discounts such as those
currently maintained on the Exchange have been widely adopted by
exchanges and are equitable and non-discriminatory because they are
open to all Members on an equal basis and provide additional benefits
or discounts that are reasonably related to the value of 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. While the proposed modification to Add/Remove
Volume Tiers 2, 3, 8 and 9 makes such tiers slightly more difficult to
attain, it is intended to incentivize Members to send additional volume
to the Exchange in an effort to qualify or continue to qualify for the
reduced fees and enhanced rebates, as applicable, made available by the
tiers. As such, the Exchange also believes that the proposed changes
are reasonable. The Exchange notes that increased volume on the
Exchange provides greater trading opportunities for all market
participants.
(B) Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. The Exchange does not believe
that any of the proposed change to the Exchange's tiered pricing
structure burden competition, but instead, that they enhance
competition as they are intended to increase the competitiveness of BYX
by modifying pricing incentives in order to attract order flow and
incentivize participants to increase their participation on the
Exchange. The Exchange notes that it operates in a highly competitive
market in which market participants can readily direct order flow to
competing venues if they deem fee structures to be unreasonable or
excessive. The Exchange does not believe the proposed amendments would
burden intramarket competition as they would be available to all
Members uniformly.
(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 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 \14\ and paragraph (f) of Rule 19b-4
thereunder.\15\ 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.
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f).
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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 [email protected]. Please include
File Number SR-CboeBYX-2018-007 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-CboeBYX-2018-007. 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 website (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 website 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. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-CboeBYX-2018-007 and should be submitted
on or before July 10, 2018.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-13085 Filed 6-18-18; 8:45 am]
BILLING CODE 8011-01-P