Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Change To Modify the NYSE American Options Fee Schedule, 54611-54613 [2020-19326]

Download as PDF Federal Register / Vol. 85, No. 171 / Wednesday, September 2, 2020 / Notices A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change SECURITIES AND EXCHANGE COMMISSION [Release No. 34–89692; File No. SR– NYSEAMER–2020–65] Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Change To Modify the NYSE American Options Fee Schedule August 27, 2020. 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 August 26, 2020, NYSE American LLC (‘‘NYSE American’’ or the ‘‘Exchange’’) 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 selfregulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to modify the NYSE American Options Fee Schedule (‘‘Fee Schedule’’) to waive certain Floorbased fixed fees for September 2020. The Exchange proposes to implement the fee change effective August 26, 2020. The proposed change is available on the Exchange’s website at www.nyse.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. jbell on DSKJLSW7X2PROD 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 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 VerDate Sep<11>2014 17:33 Sep 01, 2020 Jkt 250001 1. Purpose The purpose of this filing is to modify the Fee Schedule to waive certain Floorbased fixed fees for September 2020 for market participants that have been unable to resume their Floor operations to a certain capacity level, as discussed below. The Exchange proposes to implement the fee change effective August 26, 2020. On March 18, 2020, the Exchange announced that it would temporarily close the Trading Floor, effective Monday, March 23, 2020, as a precautionary measure to prevent the potential spread of COVID–19. Following the temporary closure of the Trading Floor, the Exchange temporarily modified certain fees for April, May and June 2020 (the ‘‘fee waiver’’).4 Although the Trading Floor partially reopened on May 26, 2020 and Floor-based open outcry activity is supported, certain participants have been unable to resume pre-Floor closure levels of operations. As a result, the Exchange extended the fee waiver through July, and later August, 2020, but only for Floor Broker firms that were unable to operate at more than 50% of their March 2020 onFloor staffing levels and for Market Maker firms that have vacant or ‘‘unmanned’’ Podia for the entire month due to COVID–19 related considerations (the ‘‘Qualifying Firms’’).5 Because the Trading Floor will continue to operate with reduced capacity, the Exchange proposes to extend the August fee waiver for Qualifying Firms through September 2020. Specifically, the proposed fee waiver covers the following fixed fees for Qualifying Firms, which relate directly to Floor operations, are charged only to Floor participants and do not apply to 4 See Securities Exchange Act Release Nos. 88595 (April 8, 2020), 85 FR 20737 (April 14, 2020) (SR– NYSEAMER–2020–25) (waiving Floor-based fixed fees); 88840 (May 8, 2020), 85 FR 28992 (May 14, 2020) (SR–NYSEAMER–2020–37) (extending April 2020 fee changes through May 2020); and 89049 (June 11, 2020), 85 FR 36649 (June 17, 2020) (SR– NYSEAMER–2020–44) (extending April and May fee changes through June 2020). See also Fee Schedule, Section III. Monthly Trading Permit, Rights, Floor Access and Premium Product Fees, and IV. Monthly Floor Communication, Connectivity, Equipment and Booth or Podia Fees. 5 See Securities Exchange Act Release Nos. 89241 (July 7, 2020), 85 FR 42034 (July 13, 2020) (SR– NYSEAMER–2020–47); 89482 (August 5, 2020), 85 FR 48577 (August 11, 2020) (SR–NYSEAMER– 2020–55) (the ‘‘August fee waiver’’). See also Fee Schedule, Section III., Monthly Trading Permit, Rights, Floor Access and Premium Product Fees, and IV. Monthly Floor Communication, Connectivity, Equipment and Booth or Podia Fees. PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 54611 participants that conduct business offFloor: • Floor Access Fee; • Floor Broker Handheld • Transport Charges • Floor Market Maker Podia; • Booth Premises; and • Wire Services.6 Like the August fee waiver, the proposed fee change is designed to reduce monthly costs for Qualifying Firms whose operations continue to be disrupted, despite the fact that the Trading Floor has partially reopened. In reducing this monthly financial burden, the proposed change would allow Qualifying Firms to reallocate funds to assist with the cost of shifting and maintaining their prior fully-staffed onFloor operations to off-Floor and recoup losses as a result of the partial reopening of the Floor. Absent this change, such participants may experience an unexpected increase in the cost of doing business on the Exchange.7 The Exchange believes that all Qualifying Firms would benefit from this proposed fee change. 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 operates in a highly competitive market. The Commission has repeatedly expressed its preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. In Regulation NMS, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system ‘‘has been remarkably successful in promoting market competition in its 6 See proposed Fee Schedule, Section III., Monthly Trading Permit, Rights, Floor Access and Premium Product Fees, and IV. Monthly Floor Communication, Connectivity, Equipment and Booth or Podia Fees. 7 The Exchange will refund participants of the Floor Broker Prepayment Program for any prepaid September 2020 fees that are waived. See proposed Fee Schedule, Section III.E.1 (providing that ‘‘the Exchange will refund certain of the prepaid Eligible Fixed costs that were waived for July through September 2020 for Qualifying Firms, as defined, and set forth in, Sections III.B and IV’’). 8 15 U.S.C. 78f(b). 9 15 U.S.C. 78f(b)(4) and (5). E:\FR\FM\02SEN1.SGM 02SEN1 54612 Federal Register / Vol. 85, No. 171 / Wednesday, September 2, 2020 / Notices jbell on DSKJLSW7X2PROD with NOTICES broader forms that are most important to investors and listed companies.’’ 10 There are currently 16 registered options exchanges competing for order flow. Based on publicly-available information, and excluding index-based options, no single exchange has more than 16% of the market share of executed volume of multiply-listed equity and ETF options trades.11 Therefore, currently no exchange possesses significant pricing power in the execution of multiply-listed equity & ETF options order flow. More specifically, in June 2020, the Exchange had less than 10% market share of executed volume of multiply-listed equity & ETF options trades.12 This proposed fee change is reasonable, equitable, and not unfairly discriminatory because it would reduce monthly costs for Qualifying Firms whose operations have been disrupted despite the fact that the Trading Floor has partially reopened because of the social distancing requirements and/or other health concerns related to resuming operation on the Floor. In reducing this monthly financial burden, the proposed change would allow Qualifying Firms to reallocate funds to assist with the cost of shifting and maintaining their prior fully-staffed onFloor operations to off-Floor and recoup losses as a result of the partial reopening. Absent this change, such participants may experience an unexpected increase in the cost of doing business on the Exchange. The Exchange believes the proposed rule change is an equitable allocation of its fees and credits as it merely continues the August fee waiver, which affects fees charged only to Floor participants and does not apply to participants that conduct business offFloor. The Exchange believes it is an equitable allocation of fees and credits to extend this fee waiver to Qualifying Firms because such firms have either less than half of their Floor staff (March 2020) levels or have vacant podia—and this reduction in physical capacity on the Floor impacts the speed, volume and efficiency with which these firms can operate, which is to their detriment. The Exchange believes that the proposal is not unfairly discriminatory because the proposed continuation of 10 See Securities Exchange Act Release No. 51808 (June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) (S7–10–04) (‘‘Reg NMS Adopting Release’’). 11 The OCC publishes options and futures volume in a variety of formats, including daily and monthly volume by exchange, available here: https:// www.theocc.com/market-data/volume/default.jsp. 12 Based on OCC data, see id., the Exchange’s market share in equity-based options increased slightly from 8.20% for the month of June 2019 to 8.32% for the month of June 2020. VerDate Sep<11>2014 17:33 Sep 01, 2020 Jkt 250001 the fee waiver would affect all similarlysituated market participants on an equal and non-discriminatory basis. Finally, the Exchange believes that it is subject to significant competitive forces, as described below in the Exchange’s statement regarding the burden on competition. B. Self-Regulatory Organization’s Statement on Burden on Competition In accordance with Section 6(b)(8) of the Act, the Exchange does not believe that the proposed rule change would impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange believes that the proposed changes would encourage the continued participation of Qualifying Firms, thereby promoting market depth, price discovery and transparency and enhancing order execution opportunities for all market participants. As a result, the Exchange believes that the proposed change furthers the Commission’s goal in adopting Regulation NMS of fostering integrated competition among orders, which promotes ‘‘more efficient pricing of individual stocks for all types of orders, large and small.’’ 13 Intramarket Competition. The proposed change, which continues the fee waiver in place when the Floor was temporarily closed but only for Qualifying Firms, is designed to reduce monthly costs for Floor participants whose operations continue to be impacted, despite the fact that the Trading Floor has partially reopened. In reducing this monthly financial burden, the proposed change would allow Qualifying Firms to reallocate funds to assist with the cost of shifting and maintaining their previously on-Floor operations to off-Floor. Absent this change, such Qualifying Firms may experience an unintended increase in the cost of doing business on the Exchange, given that the Floor has only reopened in a limited capacity. The Exchange believes that the proposed waiver of fees for Qualifying Firms would not impose a disparate burden on competition among market participants on the Exchange because off-Floor market participants are not subject to these Floor-based fixed fees, and Floorbased firms that are not subject to the extent of staffing shortfalls as the Qualifying Firms—i.e., have at least 50% of their March 2020 staffing levels on the Floor and/or have no vacant Podia during September 2020, do not face the same operational disruption 13 See Reg NMS Adopting Release, supra note 10, at 37499. PO 00000 Frm 00081 Fmt 4703 Sfmt 4703 and potential financial impact during the partial reopening of the Floor. Intermarket Competition. The Exchange operates in a highly competitive market in which market participants can readily favor one of the 16 competing option exchanges if they deem fee levels at a particular venue to be excessive. In such an environment, the Exchange must continually adjust its fees to remain competitive with other exchanges and to attract order flow to the Exchange. Based on publiclyavailable information, and excluding index-based options, no single exchange currently has more than 16% of the market share of executed volume of multiply-listed equity and ETF options trades.14 Therefore, currently no exchange possesses significant pricing power in the execution of multiplylisted equity & ETF options order flow. More specifically, in June 2020, the Exchange had less than 10% market share of executed volume of multiplylisted equity & ETF options trades.15 The Exchange believes that the proposed rule change reflects this competitive environment because it waives fees for Qualifying Firms and is designed to reduce monthly costs for Floor participants whose operations continue to be disrupted despite the fact that the Trading Floor has partially reopened. In reducing this monthly financial burden, the proposed change would allow affected participants to reallocate funds to assist with the cost of shifting and maintaining their prior fully-staffed on-Floor operations to offFloor. Absent this change, Qualifying Firms may experience an unintended increase in the cost of doing business on the Exchange, which would make the Exchange a less competitive venue on which to trade as compared to other options exchanges. 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) 16 of the Act and 14 See supra note 11. on OCC data, supra note 12, the Exchange’s market share in equity-based options was 8.20% for the month of June 2019 and 8.32% for the month of June 2020. 16 15 U.S.C. 78s(b)(3)(A). 15 Based E:\FR\FM\02SEN1.SGM 02SEN1 Federal Register / Vol. 85, No. 171 / Wednesday, September 2, 2020 / Notices subparagraph (f)(2) of Rule 19b–4 17 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 Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B) 18 of the Act to determine whether the proposed rule change should be approved or disapproved. 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–NYSEAMER–2020–65, and should be submitted on or before September 23, 2020. 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: For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 Jill M. Peterson, Assistant Secretary. jbell on DSKJLSW7X2PROD with NOTICES 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– NYSEAMER–2020–65 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–NYSEAMER–2020–65. 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 17 17 18 15 CFR 240.19b–4(f)(2). U.S.C. 78s(b)(2)(B). VerDate Sep<11>2014 17:33 Sep 01, 2020 [FR Doc. 2020–19326 Filed 9–1–20; 8:45 am] BILLING CODE 8011–01–P SMALL BUSINESS ADMINISTRATION Claritas Capital Specialty Debt Fund, L.P.; License No. 04/04–0310; Surrender of License of Small Business Investment Company Pursuant to the authority granted to the United States Small Business Administration under the Small Business Investment Act of 1958, as amended, under Section 309 of the Act and Section 107.1900 of the Small Business Administration Rules and Regulations (13 CFR 107.1900) to function as a small business investment company under the Small Business Investment Company License No. 04/ 04–0310 issued to Claritas Capital Specialty Debt Fund, L.P. said license is hereby declared null and void. U.S. Small Business Administration. Christopher L. Weaver, Acting Associate Administrator, Office of Investment and Innovation. [FR Doc. 2020–18849 Filed 9–1–20; 8:45 am] BILLING CODE P 19 17 Jkt 250001 PO 00000 CFR 200.30–3(a)(12). Frm 00082 Fmt 4703 Sfmt 4703 54613 DEPARTMENT OF STATE [Public Notice 11196] 60-Day Notice of Proposed Information Collection: Request To Change EndUser, End-Use and/or Destination of Hardware Notice of request for public comment. ACTION: The Department of State is seeking Office of Management and Budget (OMB) approval for the information collection described below. In accordance with the Paperwork Reduction Act of 1995, we are requesting comments on this collection from all interested individuals and organizations. The purpose of this notice is to allow 60 days for public comment preceding submission of the collection to OMB. DATES: The Department will accept comments from the public up to November 2, 2020. ADDRESSES: You may submit comments by any of the following methods: • Web: Persons with access to the internet may comment on this notice by going to www.Regulations.gov. You can search for the document by entering ‘‘Docket Number: DOS–2020–0038’’ in the Search field. Then click the ‘‘Comment Now’’ button and complete the comment form. • Email: DDTCPublicComments@ state.gov, ATTN: Advisory Opinion Form. • Regular Mail: Send written comments to: Directorate of Defense Trade Controls, Department of State; 2401 E St. NW, Suite H1205, Washington, DC 20522. You must include the DS form number (if applicable), information collection title, and the OMB control number in any correspondence. FOR FURTHER INFORMATION CONTACT: Direct requests for additional information regarding the collection listed in this notice, including requests for copies of the proposed collection instrument and supporting documents, to Andrea Battista, Directorate of Defense Trade Controls, Department of State, who may be reached at BattistaAl@state.gov or 202–663–3136 (please include subject line ‘‘ATTN: Advisory Opinion Form’’). SUPPLEMENTARY INFORMATION: • Title of Information Collection: Request to Change End-User, End-Use and/or Destination of Hardware. • OMB Control Number: 1405–0173. • Type of Request: Revision of a Currently Approved Collection. • Originating Office: T/PM/DDTC. SUMMARY: E:\FR\FM\02SEN1.SGM 02SEN1

Agencies

[Federal Register Volume 85, Number 171 (Wednesday, September 2, 2020)]
[Notices]
[Pages 54611-54613]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-19326]



[[Page 54611]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-89692; File No. SR-NYSEAMER-2020-65]


Self-Regulatory Organizations; NYSE American LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Change To Modify the 
NYSE American Options Fee Schedule

August 27, 2020.
    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 August 26, 2020, NYSE American LLC (``NYSE American'' or 
the ``Exchange'') 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.
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    \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 Substance 
of the Proposed Rule Change

    The Exchange proposes to modify the NYSE American Options Fee 
Schedule (``Fee Schedule'') to waive certain Floor-based fixed fees for 
September 2020. The Exchange proposes to implement the fee change 
effective August 26, 2020. The proposed change is available on the 
Exchange's website 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of this filing is to modify the Fee Schedule to waive 
certain Floor-based fixed fees for September 2020 for market 
participants that have been unable to resume their Floor operations to 
a certain capacity level, as discussed below. The Exchange proposes to 
implement the fee change effective August 26, 2020.
    On March 18, 2020, the Exchange announced that it would temporarily 
close the Trading Floor, effective Monday, March 23, 2020, as a 
precautionary measure to prevent the potential spread of COVID-19. 
Following the temporary closure of the Trading Floor, the Exchange 
temporarily modified certain fees for April, May and June 2020 (the 
``fee waiver'').\4\ Although the Trading Floor partially reopened on 
May 26, 2020 and Floor-based open outcry activity is supported, certain 
participants have been unable to resume pre-Floor closure levels of 
operations. As a result, the Exchange extended the fee waiver through 
July, and later August, 2020, but only for Floor Broker firms that were 
unable to operate at more than 50% of their March 2020 on-Floor 
staffing levels and for Market Maker firms that have vacant or 
``unmanned'' Podia for the entire month due to COVID-19 related 
considerations (the ``Qualifying Firms'').\5\ Because the Trading Floor 
will continue to operate with reduced capacity, the Exchange proposes 
to extend the August fee waiver for Qualifying Firms through September 
2020.
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    \4\ See Securities Exchange Act Release Nos. 88595 (April 8, 
2020), 85 FR 20737 (April 14, 2020) (SR-NYSEAMER-2020-25) (waiving 
Floor-based fixed fees); 88840 (May 8, 2020), 85 FR 28992 (May 14, 
2020) (SR-NYSEAMER-2020-37) (extending April 2020 fee changes 
through May 2020); and 89049 (June 11, 2020), 85 FR 36649 (June 17, 
2020) (SR-NYSEAMER-2020-44) (extending April and May fee changes 
through June 2020). See also Fee Schedule, Section III. Monthly 
Trading Permit, Rights, Floor Access and Premium Product Fees, and 
IV. Monthly Floor Communication, Connectivity, Equipment and Booth 
or Podia Fees.
    \5\ See Securities Exchange Act Release Nos. 89241 (July 7, 
2020), 85 FR 42034 (July 13, 2020) (SR-NYSEAMER-2020-47); 89482 
(August 5, 2020), 85 FR 48577 (August 11, 2020) (SR-NYSEAMER-2020-
55) (the ``August fee waiver''). See also Fee Schedule, Section 
III., Monthly Trading Permit, Rights, Floor Access and Premium 
Product Fees, and IV. Monthly Floor Communication, Connectivity, 
Equipment and Booth or Podia Fees.
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    Specifically, the proposed fee waiver covers the following fixed 
fees for Qualifying Firms, which relate directly to Floor operations, 
are charged only to Floor participants and do not apply to participants 
that conduct business off-Floor:
     Floor Access Fee;
     Floor Broker Handheld
     Transport Charges
     Floor Market Maker Podia;
     Booth Premises; and
     Wire Services.\6\
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    \6\ See proposed Fee Schedule, Section III., Monthly Trading 
Permit, Rights, Floor Access and Premium Product Fees, and IV. 
Monthly Floor Communication, Connectivity, Equipment and Booth or 
Podia Fees.
---------------------------------------------------------------------------

    Like the August fee waiver, the proposed fee change is designed to 
reduce monthly costs for Qualifying Firms whose operations continue to 
be disrupted, despite the fact that the Trading Floor has partially 
reopened. In reducing this monthly financial burden, the proposed 
change would allow Qualifying Firms to reallocate funds to assist with 
the cost of shifting and maintaining their prior fully-staffed on-Floor 
operations to off-Floor and recoup losses as a result of the partial 
reopening of the Floor. Absent this change, such participants may 
experience an unexpected increase in the cost of doing business on the 
Exchange.\7\ The Exchange believes that all Qualifying Firms would 
benefit from this proposed fee change.
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    \7\ The Exchange will refund participants of the Floor Broker 
Prepayment Program for any prepaid September 2020 fees that are 
waived. See proposed Fee Schedule, Section III.E.1 (providing that 
``the Exchange will refund certain of the prepaid Eligible Fixed 
costs that were waived for July through September 2020 for 
Qualifying Firms, as defined, and set forth in, Sections III.B and 
IV'').
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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 operates in a highly competitive market. The 
Commission has repeatedly expressed its preference for competition over 
regulatory intervention in determining prices, products, and services 
in the securities markets. In Regulation NMS, the Commission 
highlighted the importance of market forces in determining prices and 
SRO revenues and, also, recognized that current regulation of the 
market system ``has been remarkably successful in promoting market 
competition in its

[[Page 54612]]

broader forms that are most important to investors and listed 
companies.'' \10\
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    \10\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37496, 37499 (June 29, 2005) (S7-10-04) (``Reg NMS 
Adopting Release'').
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    There are currently 16 registered options exchanges competing for 
order flow. Based on publicly-available information, and excluding 
index-based options, no single exchange has more than 16% of the market 
share of executed volume of multiply-listed equity and ETF options 
trades.\11\ Therefore, currently no exchange possesses significant 
pricing power in the execution of multiply-listed equity & ETF options 
order flow. More specifically, in June 2020, the Exchange had less than 
10% market share of executed volume of multiply-listed equity & ETF 
options trades.\12\
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    \11\ The OCC publishes options and futures volume in a variety 
of formats, including daily and monthly volume by exchange, 
available here: https://www.theocc.com/market-data/volume/default.jsp.
    \12\ Based on OCC data, see id., the Exchange's market share in 
equity-based options increased slightly from 8.20% for the month of 
June 2019 to 8.32% for the month of June 2020.
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    This proposed fee change is reasonable, equitable, and not unfairly 
discriminatory because it would reduce monthly costs for Qualifying 
Firms whose operations have been disrupted despite the fact that the 
Trading Floor has partially reopened because of the social distancing 
requirements and/or other health concerns related to resuming operation 
on the Floor. In reducing this monthly financial burden, the proposed 
change would allow Qualifying Firms to reallocate funds to assist with 
the cost of shifting and maintaining their prior fully-staffed on-Floor 
operations to off-Floor and recoup losses as a result of the partial 
reopening. Absent this change, such participants may experience an 
unexpected increase in the cost of doing business on the Exchange.
    The Exchange believes the proposed rule change is an equitable 
allocation of its fees and credits as it merely continues the August 
fee waiver, which affects fees charged only to Floor participants and 
does not apply to participants that conduct business off-Floor. The 
Exchange believes it is an equitable allocation of fees and credits to 
extend this fee waiver to Qualifying Firms because such firms have 
either less than half of their Floor staff (March 2020) levels or have 
vacant podia--and this reduction in physical capacity on the Floor 
impacts the speed, volume and efficiency with which these firms can 
operate, which is to their detriment.
    The Exchange believes that the proposal is not unfairly 
discriminatory because the proposed continuation of the fee waiver 
would affect all similarly-situated market participants on an equal and 
non-discriminatory basis.
    Finally, the Exchange believes that it is subject to significant 
competitive forces, as described below in the Exchange's statement 
regarding the burden on competition.

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

    In accordance with Section 6(b)(8) of the Act, the Exchange does 
not believe that the proposed rule change would impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. The Exchange believes that the proposed changes 
would encourage the continued participation of Qualifying Firms, 
thereby promoting market depth, price discovery and transparency and 
enhancing order execution opportunities for all market participants. As 
a result, the Exchange believes that the proposed change furthers the 
Commission's goal in adopting Regulation NMS of fostering integrated 
competition among orders, which promotes ``more efficient pricing of 
individual stocks for all types of orders, large and small.'' \13\
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    \13\ See Reg NMS Adopting Release, supra note 10, at 37499.
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    Intramarket Competition. The proposed change, which continues the 
fee waiver in place when the Floor was temporarily closed but only for 
Qualifying Firms, is designed to reduce monthly costs for Floor 
participants whose operations continue to be impacted, despite the fact 
that the Trading Floor has partially reopened. In reducing this monthly 
financial burden, the proposed change would allow Qualifying Firms to 
reallocate funds to assist with the cost of shifting and maintaining 
their previously on-Floor operations to off-Floor. Absent this change, 
such Qualifying Firms may experience an unintended increase in the cost 
of doing business on the Exchange, given that the Floor has only 
reopened in a limited capacity. The Exchange believes that the proposed 
waiver of fees for Qualifying Firms would not impose a disparate burden 
on competition among market participants on the Exchange because off-
Floor market participants are not subject to these Floor-based fixed 
fees, and Floor-based firms that are not subject to the extent of 
staffing shortfalls as the Qualifying Firms--i.e., have at least 50% of 
their March 2020 staffing levels on the Floor and/or have no vacant 
Podia during September 2020, do not face the same operational 
disruption and potential financial impact during the partial reopening 
of the Floor.
    Intermarket Competition. The Exchange operates in a highly 
competitive market in which market participants can readily favor one 
of the 16 competing option exchanges if they deem fee levels at a 
particular venue to be excessive. In such an environment, the Exchange 
must continually adjust its fees to remain competitive with other 
exchanges and to attract order flow to the Exchange. Based on publicly-
available information, and excluding index-based options, no single 
exchange currently has more than 16% of the market share of executed 
volume of multiply-listed equity and ETF options trades.\14\ Therefore, 
currently no exchange possesses significant pricing power in the 
execution of multiply-listed equity & ETF options order flow. More 
specifically, in June 2020, the Exchange had less than 10% market share 
of executed volume of multiply-listed equity & ETF options trades.\15\
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    \14\ See supra note 11.
    \15\ Based on OCC data, supra note 12, the Exchange's market 
share in equity-based options was 8.20% for the month of June 2019 
and 8.32% for the month of June 2020.
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    The Exchange believes that the proposed rule change reflects this 
competitive environment because it waives fees for Qualifying Firms and 
is designed to reduce monthly costs for Floor participants whose 
operations continue to be disrupted despite the fact that the Trading 
Floor has partially reopened. In reducing this monthly financial 
burden, the proposed change would allow affected participants to 
reallocate funds to assist with the cost of shifting and maintaining 
their prior fully-staffed on-Floor operations to off-Floor. Absent this 
change, Qualifying Firms may experience an unintended increase in the 
cost of doing business on the Exchange, which would make the Exchange a 
less competitive venue on which to trade as compared to other options 
exchanges.

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) \16\ of the Act and

[[Page 54613]]

subparagraph (f)(2) of Rule 19b-4 \17\ thereunder, because it 
establishes a due, fee, or other charge imposed by the Exchange.
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    \16\ 15 U.S.C. 78s(b)(3)(A).
    \17\ 17 CFR 240.19b-4(f)(2).
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    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) \18\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \18\ 15 U.S.C. 78s(b)(2)(B).
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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-NYSEAMER-2020-65 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-NYSEAMER-2020-65. 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-NYSEAMER-2020-65, and should be 
submitted on or before September 23, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2020-19326 Filed 9-1-20; 8:45 am]
BILLING CODE 8011-01-P
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