Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Change To Amend the NYSE American Options Proprietary Market Data Fee Schedule, 12748-12752 [2022-04673]
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Federal Register / Vol. 87, No. 44 / Monday, March 7, 2022 / Notices
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J. Matthew DeLesDernier,
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PLACE:
Self-Regulatory Organizations; NYSE
American LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Change To Amend the NYSE American
Options Proprietary Market Data Fee
Schedule
March 1, 2022.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934
(‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on February
23, 2022, NYSE American LLC (‘‘NYSE
American’’ or the ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the selfregulatory 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).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
36 17
CFR 200.30–3(a)(12).
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
NYSE American Options Proprietary
Market Data Fee Schedule (‘‘Fee
Schedule’’) to adopt fees for the NYSE
Options Open-Close Volume Summary
market data product, effective March 1,
2022. 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 Exchange proposes to amend the
Fee Schedule to adopt fees for the NYSE
Options Open-Close Volume Summary,4
which will be available for purchase by
any market participant, i.e., members 5
and non-members. The Exchange
proposes to implement fees for the
NYSE Options Open-Close Volume
Summary market data product on March
1, 2022. The proposed fees would be
applied equally to all market
participants and all market participants
would receive the same information in
the data feed.
Background
By way of background, pursuant to
the Product Filing, the Exchange
adopted two versions of the NYSE
Options Open-Close Volume Summary:
An End of Day Volume Summary
market data product and an Intra-Day
4 See Securities Exchange Act Release No. 93803
(December 16, 2021), 86 FR 72647 (December 22,
2021) (SR–NYSEAmerican–2021–46) (Notice of
Filing and Immediate Effectiveness of Proposed
Rule Change To Adopt a New Historical Market
Data Product To Be Known as the NYSE Options
Open-Close Volume Summary) (‘‘Product Filing’’).
5 Members of the Exchange are member
organizations, members, ETP Holders and ATP
Holders.
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Volume Summary market data product.
The Exchange will initially offer the
End of Day Volume Summary market
data product and the purpose of this
filing is to adopt fees for the End of Day
Volume Summary market data product.6
The End of Day Volume Summary
provides a volume summary of trading
activity on the Exchange at the option
level by origin (Customer, Professional
Customer, Firm, Broker-Dealer, and
Market Maker 7), side of the market (buy
or sell), contract volume, and
transaction type (opening or closing).
The Customer, Professional Customer,
Firm, Broker-Dealer, and Market Maker
volume is further broken down into
trade size buckets (less than 100
contracts, 100–199 contracts, greater
than 199 contracts). The NYSE Options
Open-Close Volume Summary is
proprietary Exchange trade data and
does not include trade data from any
other exchange. It is also a historical
data product and not a real-time data
feed.
The Exchange anticipates a wide
variety of market participants to
purchase the End of Day Volume
Summary data product, including, but
not limited to, individual customers,
buy-side investors, and investment
banks. The Exchange believes the End of
Day Volume Summary would provide
subscribers data that should enhance
their ability to analyze options trade and
volume data, and to create and test
trading models and analytical strategies.
The Exchange believes the End of Day
Volume Summary will be a valuable
tool that subscribers can use to gain
comprehensive insight into the trading
activity in a particular options series.
The End of Day Volume Summary is a
completely voluntary product, in that
the Exchange is not required by any rule
or regulation to make this data available
and that potential subscribers may
purchase it only if they voluntarily
choose to do so. The Exchange notes
that other exchanges offer a similar
product.8
6 The Exchange intends to offer the Intra-Day
Volume Summary market data product when the
NYSE American options market transitions to the
Pillar trading platform, anticipated for Q4 2022. The
Exchange will submit a separate proposed rule
change to establish fees for the Intra-Day Volume
Summary market data product prior to its launch.
7 The terms Customer, Professional Customer,
Firm and Market Maker are defined in Rule
900.2NY. Definitions.
8 See Securities Exchange Act Release Nos. 89497
(August 6, 2020), 85 FR 48747 (August 12, 2020)
(SR–CboeBZX–2020–059); 89498 (August 6, 2020),
85 FR 48735 (August 12, 2020) (SR–Cboe–EDGX–
2020–36);85817 (May 9, 2019), 84 FR 21863 (May
15, 2019) (SR–CBOE–2019–026); 89496 (August 6,
2020), 85 FR 48743 (August 12, 2020) (SR–C2–
2020–010); 89586 (August 17, 2020), 85 FR 51833
(August 21, 2020) (SR–C2–2020–012); 62887
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The End of Day Volume Summary is
subject to direct competition from
similar end of day options trading
summaries offered by other options
exchanges.9 All of these exchanges offer
essentially the same end of day options
trading summary information. The
options trading summary files offered by
the Exchange’s competitors are
substitutes, not complements. The End
of Day Volume Summary provides data
on options market activity which can be
used to infer longer-term trends. The
information provided by one exchange
is generally similar to that provided by
other exchanges because order flow can
move from one exchange to another, and
market sentiment trends that appear on
one exchange are likely to be similar to
the sentiment trends on other
exchanges. The key differentiator in the
quality of the data depends on the
volume of transactions on a given
exchange. The greater the volume of
transactions, the greater the value of the
data.
Proposed Rule Change
The Exchange proposes to adopt
subscription fees for the purchase of the
End of Day Volume Summary on a
monthly basis. The Exchange proposes
to assess a fee of $750 per month for
subscribing to the End of Day Volume
Summary. The Exchange also proposes
that for mid-month subscriptions, new
subscribers will be charged for the full
calendar month for which they
subscribe and will be provided NYSE
Options Open-Close Volume Summary
data for each trading day of the calendar
month in which they subscribed. The
proposed monthly fees will apply to all
market participants. The Exchange notes
that other exchanges provide similar
data products that may be purchased on
a monthly basis and are comparably
priced.10
(September 10, 2010), 75 FR 57092 (September 17,
2010) (SR–Phlx–2010–121); 65587 (October 18,
2011), 76 FR 65765 (October 24, 2011) (SR–
NASDAQ–2011–144); 61317 (January 8, 2010), 75
FR 2915 (January 19, 2010) (SR–ISE–2009–103);
81632 (September 15, 2017), 82 FR 44235
(September 21, 2017) (SR–GEMX–2017–42); 91963
(May 21, 2021), 86 FR 28662 (May 27, 2021) (SR–
EMERALD–2021–18); 91964 (May 21, 2012), 86 FR
28667 (May 27, 2021) (SR–PEARL–2021–24); and
91965 (May 21, 2021), 86 FR 28665 (May 27, 2021)
(SR–MIAX–2021–18).
9 See note 8, supra.
10 See Price List—U.S. Derivatives Data for
Nasdaq PHLX, LLC (‘‘PHLX’’), The Nasdaq Stock
Market, LLC (‘‘Nasdaq’’), Nasdaq ISE, LLC (‘‘ISE’’),
and Nasdaq GEMX, LLC (‘‘GEMX’’), available at
https://www.nasdaqtrader.com/Trader.aspx?
id=DPPriceListOptions#web. Particularly, PHLX
offers ‘‘Nasdaq PHLX Options Trade Outline
(PHOTO)’’ and assesses $750 per month for an end
of day subscription; Nasdaq offers the ‘‘Nasdaq
Options Trade Outline (NOTO)’’ and assesses $500
per month for an end of day subscription; ISE offers
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2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,11 in general, and
furthers the objectives of Section 6(b)(5)
of the Act,12 in particular, in that it is
designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system, and to protect investors and the
public interest, and that it is not
designed to permit unfair
discrimination among customers,
brokers, or dealers. The Exchange also
believes that its proposal to adopt fees
for the End of Day Volume Summary
market data product is consistent with
Section 6(b) of the Act 13 in general, and
furthers the objectives of Section 6(b)(4)
of the Act 14 in particular, in that it is
an equitable allocation of dues, fees and
other charges among its members and
other recipients of Exchange data.
In adopting Regulation NMS, the
Commission granted self-regulatory
organizations (‘‘SROs’’) and brokerdealers increased authority and
flexibility to offer new and unique
market data to the public. It was
believed that this authority would
expand the amount of data available to
users and consumers of such data and
also spur innovation and competition
for the provision of market data.
Particularly, the End of Day Volume
Summary further broadens the
availability of U.S. options market data
to investors consistent with the
principles of Regulation NMS.
the ‘‘Nasdaq ISE Open/Close Trade Profile’’ and
assesses $750 per month for an end of day
subscription; and GEMX offers the ‘‘Nasdaq GEMX
Open/Close Trade Profile’’ and assesses $500 per
month for an end of day subscription. Cboe EDGX
Exchange, Inc. (‘‘EDGX’’) assesses $500 per month
for an end of day subscription and Cboe BZX
Exchange, Inc. (‘‘BZX’’) assesses $500 per month for
an end of day subscription. See EDGX fee schedule
available at https://markets.cboe.com/us/options/
membership/fee_schedule/edgx/; and BZX fee
schedule available at https://markets.cboe.com/us/
options/membership/fee_schedule/bzx/. Miami
International Securities Exchange, LLC (‘‘MIAX’’),
MIAX Emerald, LLC (‘‘Emerald’’) and MIAX
PEARL, LLC (‘‘PEARL’’) each assesses $600 per
month for an end of day subscription. See MIAX
Fee Schedule, available at https://
www.miaxoptions.com/sites/default/files/fee_
schedule-files/MIAX_Options_Fee_Schedule_
09282021.pdf; Emerald Fee Schedule, available at
https://www.miaxoptions.com/sites/default/files/
fee_schedule-files/MIAX_Emerald_Fee_Schedule_
09282021.pdf; and PEARL Fee Schedule, available
at https://www.miaxoptions.com/sites/default/files/
fee_schedule-files/MIAX_Pearl_Options_Fee_
Schedule_092821.pdf.
11 15 U.S.C. 78f(b).
12 15 U.S.C. 78f(b)(5).
13 15 U.S.C. 78f(b).
14 15 U.S.C. 78f(b)(4).
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Subscribers to the data may also be able
to enhance their ability to analyze
options trade and volume data and
create and test trading models and
analytical strategies. The Exchange
believes the End of Day Volume
Summary would provide a valuable tool
that subscribers can use to gain
comprehensive insight into the trading
activity in a particular series, but also
emphasizes such data is not necessary
for trading. Moreover, other exchanges
offer a similar data product.15
The Exchange operates in a highly
competitive market. Indeed, 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.16
Therefore, currently no exchange
possesses significant pricing power in
the execution of multiply-listed equity
and ETF options order flow. More
specifically, in November 2021, the
Exchange had less than 8% market
share of executed volume of multiplylisted equity and ETF options trades.17
The Commission has repeatedly
expressed its preference for competition
over regulatory intervention in
determining prices, products, and
services in the securities markets.
Specifically, 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
broader forms that are most important to
investors and listed companies.’’ 18
With respect to market data, the
decision of the United States Court of
Appeals for the District of Columbia
Circuit in NetCoalition v. SEC upheld
the Commission’s reliance on the
existence of competitive market
mechanisms to evaluate the
reasonableness and fairness of fees for
proprietary market data:
15 See
note 8, supra.
Options Clearing Corporation (‘‘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/Market-Data-Reports/Volume-andOpen-Interest/Monthly-Weekly-Volume-Statistics.
17 Based on OCC data for monthly volume of
equity-based options and monthly volume of ETFbased options, see id., the Exchange’s market share
in multiply-listed equity and ETF options was
9.09% for the month of November 2020 and 7.06%
for the month of November 2021.
18 See Securities Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005).
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In fact, the legislative history indicates that
the Congress intended that the market system
‘‘evolve through the interplay of competitive
forces as unnecessary regulatory restrictions
are removed’’ and that the SEC wield its
regulatory power ‘‘in those situations where
competition may not be sufficient,’’ such as
in the creation of a ‘‘consolidated
transactional reporting system.’’ 19
The court agreed with the
Commission’s conclusion that
‘‘Congress intended that ‘competitive
forces should dictate the services and
practices that constitute the U.S.
national market system for trading
equity securities.’ ’’ 20
More recently, the Commission
confirmed that it applies a ‘‘marketbased’’ test in its assessment of market
data fees, and that under that test:
The Commission considers whether the
exchange was subject to significant
competitive forces in setting the terms of its
proposal for [market data], including the
level of any fees. If an exchange meets this
burden, the Commission will find that its fee
rule is consistent with the Act unless there
is a substantial countervailing basis to find
that the terms of the rule violate the Act or
the rules thereunder.21
Making similar historic data products
available to market participants fosters
competition in the marketplace, and
constrains the ability of exchanges to
charge supra-competitive fees. In the
event that a market participant views
one exchange’s data product as more or
less attractive than the competition they
can and do switch between similar
products. The proposed fees are a result
of the competitive environment, as the
Exchange seeks to adopt fees to attract
purchasers of the End of Day Volume
Summary data product.
The Exchange believes the proposed
fees are reasonable as they are
comparable to the fees assessed by other
exchanges that provide similar data
products.22 Indeed, proposing fees that
are excessively higher than established
fees for similar data products would
simply serve to reduce demand for the
Exchange’s data product, which as
noted, is entirely optional. Like the End
of Day Volume Summary, other
exchanges offer similar data products
that each provide insight into trading on
those markets and may likewise aid in
19 NetCoalition v. SEC, 615 F.3d 525, 535 (D.C.
Cir. 2010) (quoting H.R. Rep. No. 94–229 at 92
(1975), as reprinted in 1975 U.S.C.C.A.N. 323).
20 Id. at 535.
21 See Securities Exchange Act Release No. 34–
90217 (October 16, 2020), 85 FR 67392 (October 22,
2020) (SR–NYSENAT–2020–05) (internal quotation
marks omitted), quoting Securities Exchange Act
Release No. 59039 (December 2, 2008), 73 FR
74770, 74781 (December 9, 2008) (ArcaBook
Approval Order).
22 See, note 10, supra.
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assessing investor sentiment. Although
each of these similar data products
provide only proprietary trade data and
not trade data from other exchanges, it
is possible investors are still able to
gauge overall investor sentiment across
different option series based on open
and closing interest on any one
exchange. Similarly, market participants
may be able to analyze option trade and
volume data, and create and test trading
models and analytical strategies using
only the End of Day Volume Summary
data relating to trading activity on one
or more of the other markets that
provide similar data products. As such,
if a market participant views another
exchange’s data as more attractive than
the Exchange’s data product, then such
market participant can merely choose
not to purchase the Exchange’s data
product and instead purchase another
exchange’s product, which offer similar
data points, albeit based on that other
market’s trading activity.
The Exchange also believes the
proposed fees are reasonable as they
would support the introduction of a
new historic market data product that is
designed to aid investors by providing
insight into trading on the Exchange.
Once the End of Day Volume Summary
is made available, it would provide
options market participants with
valuable information about opening and
closing transactions executed on the
Exchange throughout the trading day,
similar to other trade data products
offered by competing options
exchanges. In turn, this data would
assist market participants in gauging
investor sentiment and trading activity,
resulting in potentially better-informed
trading decisions. As noted above,
subscribers may also use such data to
create and test trading models and
analytical strategies.
Selling historic market data is also a
means by which exchanges compete to
attract business. To the extent that the
Exchange is successful in attracting
subscribers to the Exchange’s historic
data product, it may earn trading
revenues and further enhance the value
of its data products. If the market deems
the proposed fees to be unfair or
inequitable, subscribers can diminish or
discontinue their use of the historic data
and/or avail themselves of similar
products offered by other exchanges.23
The Exchange therefore believes that the
proposed fees reflect the competitive
environment and would be properly and
equally assessed to all subscribers. The
Exchange also believes the proposed
fees are equitable and not unfairly
discriminatory as the fees would apply
23 See,
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equally to all subscribers who choose to
purchase such data. Nothing in this
proposal treats any category of market
participant any differently from any
other category of market participant.
The End of Day Volume Summary is
available to all market participants, i.e.,
members and non-members, and all
market participants would receive the
same information in the data feed.
As noted above, the Exchange
anticipates a wide variety of market
participants to purchase the Exchange’s
data product, including but not limited
to individual customers, buy-side
investors and investment banks. The
Exchange reiterates that the decision as
to whether or not to purchase the End
of Day Volume Summary is entirely
optional for all potential subscribers.
Indeed, no market participant is
required to purchase the data product,
and the Exchange is not required to
make the data product available to
market participants. Rather, the
Exchange is voluntarily making the End
of Day Volume Summary data product
available, as requested by customers,
and market participants may choose to
receive (and pay for) this data based on
their own business needs. Potential
subscribers may request the data at any
time if they believe it to be valuable or
may decline to purchase such data.
In sum, the fierce competition for
order flow constrains any exchange
from pricing its historic market data at
a supra-competitive price, and
constrains the Exchange here in setting
its fees for the End of Day Volume
Summary data product. As described
above, the Exchange’s data product
competes head-to-head with numerous
products currently available in the
marketplace. These products each serve
as reasonable substitutes for one another
as they are each designed to provide
data on options market activity which
can be used to infer longer-term trends.
The information provided by one
exchange is generally similar to that
provided by other exchanges because
order flow can move from one exchange
to another, and market sentiment trends
that appear on one exchange are likely
to be similar to the sentiment trends on
other exchanges. The key differentiator
in the quality of the data depends on the
volume of transactions on a given
exchange. The greater the volume of
transactions, the greater the value of the
historic data. The proposed fees are
therefore reasonable because in setting
them, the Exchange is constrained by
the availability of numerous substitute
venues offering historic market data
products and trading. Such substitutes
need not be identical, but only
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substantially similar to the product at
hand.
More specifically, in setting fees for
the End of Day Volume Summary, the
Exchange is constrained by the fact that,
if its pricing is unattractive to
subscribers, subscribers have their pick
of an increasing number of alternative
venues to use instead of the Exchange.
The existence of numerous alternatives
to the Exchange ensures that the
Exchange cannot set unreasonable fees
for historic market data without
suffering the negative effects of that
decision in the fiercely competitive
market in which it operates.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will result in
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
Exchange also does not believe the
proposed fees would cause any
unnecessary or inappropriate burden on
intermarket competition as other
exchanges are free to introduce their
own comparable historic data product
and adopt fees to better compete with
the Exchange’s offering. Rather, the
Exchange believes that the proposal will
promote competition by permitting the
Exchange to sell a data product similar
to those offered by other competitor
options exchanges.24 The Exchange is
offering the End of Day Volume
Summary in order to keep pace with
changes in the industry and evolving
customer needs, and believes the data
product will contribute to robust
competition among national securities
exchanges. At least eight other U.S.
options exchanges offer a market data
product that is substantially similar to
the Exchange’s offering. As a result, the
Exchange believes this proposed rule
change permits fair competition among
national securities exchanges.
Furthermore, the Exchange operates
in a highly competitive environment,
and its ability to price End of Day
Volume Summary is constrained by
competition among exchanges that offer
similar data products to their customers.
As discussed above, there are currently
a number of similar products available
to market participants and investors. At
least eight other U.S. options exchanges
offer a market data product that is
substantially similar to the Exchange’s
offering, which the Exchange must
consider in its pricing discipline in
order to compete effectively.25 For
example, proposing fees that are
excessively higher than established fees
for similar data products would simply
serve to reduce demand for the
Exchange’s data product, which as
discussed, market participants are under
no obligation to utilize or purchase. In
this competitive environment, potential
purchasers are free to choose which, if
any, similar product to purchase to
satisfy their need for market
information. As a result, the Exchange
believes this proposed rule change
permits fair competition among national
securities exchanges.
The Exchange does not believe the
proposed rule change would cause any
unnecessary or inappropriate burden on
intramarket competition. Particularly,
the proposed fees would apply
uniformly to any subscriber, in that the
Exchange would not differentiate
between subscribers that purchase the
End of Day Volume Summary and all
subscribers would receive the same
information in the data feed. The
Exchange believes the proposed fees are
set at a modest level that would allow
interested subscribers to purchase such
data based on their business needs.
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) 26 of the Act and
subparagraph (f)(2) of Rule 19b–4 27
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) 28 of the Act to
determine whether the proposed rule
change should be approved or
disapproved.
26 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(2).
28 15 U.S.C. 78s(b)(2)(B).
27 17
24 Id.
25 See,
PO 00000
note 10, supra.
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12752
Federal Register / Vol. 87, No. 44 / Monday, March 7, 2022 / Notices
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:
• 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–2022–11 on the subject
line.
Paper Comments
khammond on DSKJM1Z7X2PROD with NOTICES
• 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–2022–11. 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–2022–11 and
should be submitted on or before March
28, 2022.
17:50 Mar 04, 2022
Jkt 256001
Dated: March 3, 2022.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2022–04922 Filed 3–3–22; 4:15 pm]
BILLING CODE 8011–01–P
[FR Doc. 2022–04673 Filed 3–4–22; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
SECURITIES AND EXCHANGE
COMMISSION
Electronic Comments
VerDate Sep<11>2014
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.29
J. Matthew DeLesDernier,
Assistant Secretary.
Sunshine Act Meetings
2 p.m. on Thursday,
March 10, 2022.
PLACE: The meeting will be held via
remote means and/or at the
Commission’s headquarters, 100 F
Street NE, Washington, DC 20549.
STATUS: This meeting will be closed to
the public.
MATTERS TO BE CONSIDERED:
Commissioners, Counsel to the
Commissioners, the Secretary to the
Commission, and recording secretaries
will attend the closed meeting. Certain
staff members who have an interest in
the matters also may be present.
In the event that the time, date, or
location of this meeting changes, an
announcement of the change, along with
the new time, date, and/or place of the
meeting will be posted on the
Commission’s website at https://
www.sec.gov.
The General Counsel of the
Commission, or his designee, has
certified that, in his opinion, one or
more of the exemptions set forth in 5
U.S.C. 552b(c)(3), (5), (6), (7), (8), 9(B)
and (10) and 17 CFR 200.402(a)(3),
(a)(5), (a)(6), (a)(7), (a)(8), (a)(9)(ii) and
(a)(10), permit consideration of the
scheduled matters at the closed meeting.
The subject matter of the closed
meeting will consist of the following
topics:
Institution and settlement of
injunctive actions;
Institution and settlement of
administrative proceedings;
Resolution of litigation claims; and
Other matters relating to examinations
and enforcement proceedings.
At times, changes in Commission
priorities require alterations in the
scheduling of meeting agenda items that
may consist of adjudicatory,
examination, litigation, or regulatory
matters.
CONTACT PERSON FOR MORE INFORMATION:
For further information; please contact
Vanessa A. Countryman from the Office
of the Secretary at (202) 551–5400.
Authority: 5 U.S.C. 552b.
TIME AND DATE:
[Release No. 34–94336; File No. SR–
NYSEArca–2022–09]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend the NYSE Arca
Options Proprietary Market Data Fee
Schedule
March 1, 2022.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934
(‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on February
23, 2022, NYSE Arca, Inc. (‘‘NYSE
Arca’’ 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 self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
NYSE Arca Options Proprietary Market
Data Fee Schedule (‘‘Fee Schedule’’) to
adopt fees for the NYSE Options OpenClose Volume Summary market data
product, effective March 1, 2022. The
proposed rule 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,
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
29 17
PO 00000
CFR 200.30–3(a)(12).
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]]>Agencies
[Federal Register Volume 87, Number 44 (Monday, March 7, 2022)]
[Notices]
[Pages 12748-12752]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-04673]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-94334; File No. SR-NYSEAMER-2022-11]
Self-Regulatory Organizations; NYSE American LLC; Notice of
Filing and Immediate Effectiveness of Proposed Change To Amend the NYSE
American Options Proprietary Market Data Fee Schedule
March 1, 2022.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that, on February 23, 2022, NYSE American LLC (``NYSE American'' or the
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the 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.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend the NYSE American Options
Proprietary Market Data Fee Schedule (``Fee Schedule'') to adopt fees
for the NYSE Options Open-Close Volume Summary market data product,
effective March 1, 2022. 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 Exchange proposes to amend the Fee Schedule to adopt fees for
the NYSE Options Open-Close Volume Summary,\4\ which will be available
for purchase by any market participant, i.e., members \5\ and non-
members. The Exchange proposes to implement fees for the NYSE Options
Open-Close Volume Summary market data product on March 1, 2022. The
proposed fees would be applied equally to all market participants and
all market participants would receive the same information in the data
feed.
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release No. 93803 (December 16,
2021), 86 FR 72647 (December 22, 2021) (SR-NYSEAmerican-2021-46)
(Notice of Filing and Immediate Effectiveness of Proposed Rule
Change To Adopt a New Historical Market Data Product To Be Known as
the NYSE Options Open-Close Volume Summary) (``Product Filing'').
\5\ Members of the Exchange are member organizations, members,
ETP Holders and ATP Holders.
---------------------------------------------------------------------------
Background
By way of background, pursuant to the Product Filing, the Exchange
adopted two versions of the NYSE Options Open-Close Volume Summary: An
End of Day Volume Summary market data product and an Intra-Day
[[Page 12749]]
Volume Summary market data product. The Exchange will initially offer
the End of Day Volume Summary market data product and the purpose of
this filing is to adopt fees for the End of Day Volume Summary market
data product.\6\ The End of Day Volume Summary provides a volume
summary of trading activity on the Exchange at the option level by
origin (Customer, Professional Customer, Firm, Broker-Dealer, and
Market Maker \7\), side of the market (buy or sell), contract volume,
and transaction type (opening or closing). The Customer, Professional
Customer, Firm, Broker-Dealer, and Market Maker volume is further
broken down into trade size buckets (less than 100 contracts, 100-199
contracts, greater than 199 contracts). The NYSE Options Open-Close
Volume Summary is proprietary Exchange trade data and does not include
trade data from any other exchange. It is also a historical data
product and not a real-time data feed.
---------------------------------------------------------------------------
\6\ The Exchange intends to offer the Intra-Day Volume Summary
market data product when the NYSE American options market
transitions to the Pillar trading platform, anticipated for Q4 2022.
The Exchange will submit a separate proposed rule change to
establish fees for the Intra-Day Volume Summary market data product
prior to its launch.
\7\ The terms Customer, Professional Customer, Firm and Market
Maker are defined in Rule 900.2NY. Definitions.
---------------------------------------------------------------------------
The Exchange anticipates a wide variety of market participants to
purchase the End of Day Volume Summary data product, including, but not
limited to, individual customers, buy-side investors, and investment
banks. The Exchange believes the End of Day Volume Summary would
provide subscribers data that should enhance their ability to analyze
options trade and volume data, and to create and test trading models
and analytical strategies. The Exchange believes the End of Day Volume
Summary will be a valuable tool that subscribers can use to gain
comprehensive insight into the trading activity in a particular options
series. The End of Day Volume Summary is a completely voluntary
product, in that the Exchange is not required by any rule or regulation
to make this data available and that potential subscribers may purchase
it only if they voluntarily choose to do so. The Exchange notes that
other exchanges offer a similar product.\8\
---------------------------------------------------------------------------
\8\ See Securities Exchange Act Release Nos. 89497 (August 6,
2020), 85 FR 48747 (August 12, 2020) (SR-CboeBZX-2020-059); 89498
(August 6, 2020), 85 FR 48735 (August 12, 2020) (SR-Cboe-EDGX-2020-
36);85817 (May 9, 2019), 84 FR 21863 (May 15, 2019) (SR-CBOE-2019-
026); 89496 (August 6, 2020), 85 FR 48743 (August 12, 2020) (SR-C2-
2020-010); 89586 (August 17, 2020), 85 FR 51833 (August 21, 2020)
(SR-C2-2020-012); 62887 (September 10, 2010), 75 FR 57092 (September
17, 2010) (SR-Phlx-2010-121); 65587 (October 18, 2011), 76 FR 65765
(October 24, 2011) (SR-NASDAQ-2011-144); 61317 (January 8, 2010), 75
FR 2915 (January 19, 2010) (SR-ISE-2009-103); 81632 (September 15,
2017), 82 FR 44235 (September 21, 2017) (SR-GEMX-2017-42); 91963
(May 21, 2021), 86 FR 28662 (May 27, 2021) (SR-EMERALD-2021-18);
91964 (May 21, 2012), 86 FR 28667 (May 27, 2021) (SR-PEARL-2021-24);
and 91965 (May 21, 2021), 86 FR 28665 (May 27, 2021) (SR-MIAX-2021-
18).
---------------------------------------------------------------------------
The End of Day Volume Summary is subject to direct competition from
similar end of day options trading summaries offered by other options
exchanges.\9\ All of these exchanges offer essentially the same end of
day options trading summary information. The options trading summary
files offered by the Exchange's competitors are substitutes, not
complements. The End of Day Volume Summary provides data on options
market activity which can be used to infer longer-term trends. The
information provided by one exchange is generally similar to that
provided by other exchanges because order flow can move from one
exchange to another, and market sentiment trends that appear on one
exchange are likely to be similar to the sentiment trends on other
exchanges. The key differentiator in the quality of the data depends on
the volume of transactions on a given exchange. The greater the volume
of transactions, the greater the value of the data.
---------------------------------------------------------------------------
\9\ See note 8, supra.
---------------------------------------------------------------------------
Proposed Rule Change
The Exchange proposes to adopt subscription fees for the purchase
of the End of Day Volume Summary on a monthly basis. The Exchange
proposes to assess a fee of $750 per month for subscribing to the End
of Day Volume Summary. The Exchange also proposes that for mid-month
subscriptions, new subscribers will be charged for the full calendar
month for which they subscribe and will be provided NYSE Options Open-
Close Volume Summary data for each trading day of the calendar month in
which they subscribed. The proposed monthly fees will apply to all
market participants. The Exchange notes that other exchanges provide
similar data products that may be purchased on a monthly basis and are
comparably priced.\10\
---------------------------------------------------------------------------
\10\ See Price List--U.S. Derivatives Data for Nasdaq PHLX, LLC
(``PHLX''), The Nasdaq Stock Market, LLC (``Nasdaq''), Nasdaq ISE,
LLC (``ISE''), and Nasdaq GEMX, LLC (``GEMX''), available at https://www.nasdaqtrader.com/Trader.aspx?id=DPPriceListOptions#web.
Particularly, PHLX offers ``Nasdaq PHLX Options Trade Outline
(PHOTO)'' and assesses $750 per month for an end of day
subscription; Nasdaq offers the ``Nasdaq Options Trade Outline
(NOTO)'' and assesses $500 per month for an end of day subscription;
ISE offers the ``Nasdaq ISE Open/Close Trade Profile'' and assesses
$750 per month for an end of day subscription; and GEMX offers the
``Nasdaq GEMX Open/Close Trade Profile'' and assesses $500 per month
for an end of day subscription. Cboe EDGX Exchange, Inc. (``EDGX'')
assesses $500 per month for an end of day subscription and Cboe BZX
Exchange, Inc. (``BZX'') assesses $500 per month for an end of day
subscription. See EDGX fee schedule available at https://markets.cboe.com/us/options/membership/fee_schedule/edgx/; and BZX
fee schedule available at https://markets.cboe.com/us/options/membership/fee_schedule/bzx/. Miami International Securities
Exchange, LLC (``MIAX''), MIAX Emerald, LLC (``Emerald'') and MIAX
PEARL, LLC (``PEARL'') each assesses $600 per month for an end of
day subscription. See MIAX Fee Schedule, available at https://www.miaxoptions.com/sites/default/files/fee_schedule-files/MIAX_Options_Fee_Schedule_09282021.pdf; Emerald Fee Schedule,
available at https://www.miaxoptions.com/sites/default/files/fee_schedule-files/MIAX_Emerald_Fee_Schedule_09282021.pdf; and PEARL
Fee Schedule, available at https://www.miaxoptions.com/sites/default/files/fee_schedule-files/MIAX_Pearl_Options_Fee_Schedule_092821.pdf.
---------------------------------------------------------------------------
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\11\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\12\ in particular, in that it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and
a national market system, and to protect investors and the public
interest, and that it is not designed to permit unfair discrimination
among customers, brokers, or dealers. The Exchange also believes that
its proposal to adopt fees for the End of Day Volume Summary market
data product is consistent with Section 6(b) of the Act \13\ in
general, and furthers the objectives of Section 6(b)(4) of the Act \14\
in particular, in that it is an equitable allocation of dues, fees and
other charges among its members and other recipients of Exchange data.
---------------------------------------------------------------------------
\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(5).
\13\ 15 U.S.C. 78f(b).
\14\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
In adopting Regulation NMS, the Commission granted self-regulatory
organizations (``SROs'') and broker-dealers increased authority and
flexibility to offer new and unique market data to the public. It was
believed that this authority would expand the amount of data available
to users and consumers of such data and also spur innovation and
competition for the provision of market data. Particularly, the End of
Day Volume Summary further broadens the availability of U.S. options
market data to investors consistent with the principles of Regulation
NMS.
[[Page 12750]]
Subscribers to the data may also be able to enhance their ability to
analyze options trade and volume data and create and test trading
models and analytical strategies. The Exchange believes the End of Day
Volume Summary would provide a valuable tool that subscribers can use
to gain comprehensive insight into the trading activity in a particular
series, but also emphasizes such data is not necessary for trading.
Moreover, other exchanges offer a similar data product.\15\
---------------------------------------------------------------------------
\15\ See note 8, supra.
---------------------------------------------------------------------------
The Exchange operates in a highly competitive market. Indeed, 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.\16\
Therefore, currently no exchange possesses significant pricing power in
the execution of multiply-listed equity and ETF options order flow.
More specifically, in November 2021, the Exchange had less than 8%
market share of executed volume of multiply-listed equity and ETF
options trades.\17\
---------------------------------------------------------------------------
\16\ The Options Clearing Corporation (``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/Market-Data-Reports/Volume-and-Open-Interest/Monthly-Weekly-Volume-Statistics.
\17\ Based on OCC data for monthly volume of equity-based
options and monthly volume of ETF-based options, see id., the
Exchange's market share in multiply-listed equity and ETF options
was 9.09% for the month of November 2020 and 7.06% for the month of
November 2021.
---------------------------------------------------------------------------
The Commission has repeatedly expressed its preference for
competition over regulatory intervention in determining prices,
products, and services in the securities markets. Specifically, 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 broader forms that
are most important to investors and listed companies.'' \18\
---------------------------------------------------------------------------
\18\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005).
---------------------------------------------------------------------------
With respect to market data, the decision of the United States
Court of Appeals for the District of Columbia Circuit in NetCoalition
v. SEC upheld the Commission's reliance on the existence of competitive
market mechanisms to evaluate the reasonableness and fairness of fees
for proprietary market data:
In fact, the legislative history indicates that the Congress
intended that the market system ``evolve through the interplay of
competitive forces as unnecessary regulatory restrictions are
removed'' and that the SEC wield its regulatory power ``in those
situations where competition may not be sufficient,'' such as in the
creation of a ``consolidated transactional reporting system.'' \19\
---------------------------------------------------------------------------
\19\ NetCoalition v. SEC, 615 F.3d 525, 535 (D.C. Cir. 2010)
(quoting H.R. Rep. No. 94-229 at 92 (1975), as reprinted in 1975
U.S.C.C.A.N. 323).
The court agreed with the Commission's conclusion that ``Congress
intended that `competitive forces should dictate the services and
practices that constitute the U.S. national market system for trading
equity securities.' '' \20\
---------------------------------------------------------------------------
\20\ Id. at 535.
---------------------------------------------------------------------------
More recently, the Commission confirmed that it applies a ``market-
based'' test in its assessment of market data fees, and that under that
test:
The Commission considers whether the exchange was subject to
significant competitive forces in setting the terms of its proposal
for [market data], including the level of any fees. If an exchange
meets this burden, the Commission will find that its fee rule is
consistent with the Act unless there is a substantial countervailing
basis to find that the terms of the rule violate the Act or the
rules thereunder.\21\
---------------------------------------------------------------------------
\21\ See Securities Exchange Act Release No. 34-90217 (October
16, 2020), 85 FR 67392 (October 22, 2020) (SR-NYSENAT-2020-05)
(internal quotation marks omitted), quoting Securities Exchange Act
Release No. 59039 (December 2, 2008), 73 FR 74770, 74781 (December
9, 2008) (ArcaBook Approval Order).
Making similar historic data products available to market
participants fosters competition in the marketplace, and constrains the
ability of exchanges to charge supra-competitive fees. In the event
that a market participant views one exchange's data product as more or
less attractive than the competition they can and do switch between
similar products. The proposed fees are a result of the competitive
environment, as the Exchange seeks to adopt fees to attract purchasers
of the End of Day Volume Summary data product.
The Exchange believes the proposed fees are reasonable as they are
comparable to the fees assessed by other exchanges that provide similar
data products.\22\ Indeed, proposing fees that are excessively higher
than established fees for similar data products would simply serve to
reduce demand for the Exchange's data product, which as noted, is
entirely optional. Like the End of Day Volume Summary, other exchanges
offer similar data products that each provide insight into trading on
those markets and may likewise aid in assessing investor sentiment.
Although each of these similar data products provide only proprietary
trade data and not trade data from other exchanges, it is possible
investors are still able to gauge overall investor sentiment across
different option series based on open and closing interest on any one
exchange. Similarly, market participants may be able to analyze option
trade and volume data, and create and test trading models and
analytical strategies using only the End of Day Volume Summary data
relating to trading activity on one or more of the other markets that
provide similar data products. As such, if a market participant views
another exchange's data as more attractive than the Exchange's data
product, then such market participant can merely choose not to purchase
the Exchange's data product and instead purchase another exchange's
product, which offer similar data points, albeit based on that other
market's trading activity.
---------------------------------------------------------------------------
\22\ See, note 10, supra.
---------------------------------------------------------------------------
The Exchange also believes the proposed fees are reasonable as they
would support the introduction of a new historic market data product
that is designed to aid investors by providing insight into trading on
the Exchange. Once the End of Day Volume Summary is made available, it
would provide options market participants with valuable information
about opening and closing transactions executed on the Exchange
throughout the trading day, similar to other trade data products
offered by competing options exchanges. In turn, this data would assist
market participants in gauging investor sentiment and trading activity,
resulting in potentially better-informed trading decisions. As noted
above, subscribers may also use such data to create and test trading
models and analytical strategies.
Selling historic market data is also a means by which exchanges
compete to attract business. To the extent that the Exchange is
successful in attracting subscribers to the Exchange's historic data
product, it may earn trading revenues and further enhance the value of
its data products. If the market deems the proposed fees to be unfair
or inequitable, subscribers can diminish or discontinue their use of
the historic data and/or avail themselves of similar products offered
by other exchanges.\23\ The Exchange therefore believes that the
proposed fees reflect the competitive environment and would be properly
and equally assessed to all subscribers. The Exchange also believes the
proposed fees are equitable and not unfairly discriminatory as the fees
would apply
[[Page 12751]]
equally to all subscribers who choose to purchase such data. Nothing in
this proposal treats any category of market participant any differently
from any other category of market participant. The End of Day Volume
Summary is available to all market participants, i.e., members and non-
members, and all market participants would receive the same information
in the data feed.
---------------------------------------------------------------------------
\23\ See, note 8, supra.
---------------------------------------------------------------------------
As noted above, the Exchange anticipates a wide variety of market
participants to purchase the Exchange's data product, including but not
limited to individual customers, buy-side investors and investment
banks. The Exchange reiterates that the decision as to whether or not
to purchase the End of Day Volume Summary is entirely optional for all
potential subscribers. Indeed, no market participant is required to
purchase the data product, and the Exchange is not required to make the
data product available to market participants. Rather, the Exchange is
voluntarily making the End of Day Volume Summary data product
available, as requested by customers, and market participants may
choose to receive (and pay for) this data based on their own business
needs. Potential subscribers may request the data at any time if they
believe it to be valuable or may decline to purchase such data.
In sum, the fierce competition for order flow constrains any
exchange from pricing its historic market data at a supra-competitive
price, and constrains the Exchange here in setting its fees for the End
of Day Volume Summary data product. As described above, the Exchange's
data product competes head-to-head with numerous products currently
available in the marketplace. These products each serve as reasonable
substitutes for one another as they are each designed to provide data
on options market activity which can be used to infer longer-term
trends. The information provided by one exchange is generally similar
to that provided by other exchanges because order flow can move from
one exchange to another, and market sentiment trends that appear on one
exchange are likely to be similar to the sentiment trends on other
exchanges. The key differentiator in the quality of the data depends on
the volume of transactions on a given exchange. The greater the volume
of transactions, the greater the value of the historic data. The
proposed fees are therefore reasonable because in setting them, the
Exchange is constrained by the availability of numerous substitute
venues offering historic market data products and trading. Such
substitutes need not be identical, but only substantially similar to
the product at hand.
More specifically, in setting fees for the End of Day Volume
Summary, the Exchange is constrained by the fact that, if its pricing
is unattractive to subscribers, subscribers have their pick of an
increasing number of alternative venues to use instead of the Exchange.
The existence of numerous alternatives to the Exchange ensures that the
Exchange cannot set unreasonable fees for historic market data without
suffering the negative effects of that decision in the fiercely
competitive market in which it operates.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The Exchange
also does not believe the proposed fees would cause any unnecessary or
inappropriate burden on intermarket competition as other exchanges are
free to introduce their own comparable historic data product and adopt
fees to better compete with the Exchange's offering. Rather, the
Exchange believes that the proposal will promote competition by
permitting the Exchange to sell a data product similar to those offered
by other competitor options exchanges.\24\ The Exchange is offering the
End of Day Volume Summary in order to keep pace with changes in the
industry and evolving customer needs, and believes the data product
will contribute to robust competition among national securities
exchanges. At least eight other U.S. options exchanges offer a market
data product that is substantially similar to the Exchange's offering.
As a result, the Exchange believes this proposed rule change permits
fair competition among national securities exchanges.
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\24\ Id.
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Furthermore, the Exchange operates in a highly competitive
environment, and its ability to price End of Day Volume Summary is
constrained by competition among exchanges that offer similar data
products to their customers. As discussed above, there are currently a
number of similar products available to market participants and
investors. At least eight other U.S. options exchanges offer a market
data product that is substantially similar to the Exchange's offering,
which the Exchange must consider in its pricing discipline in order to
compete effectively.\25\ For example, proposing fees that are
excessively higher than established fees for similar data products
would simply serve to reduce demand for the Exchange's data product,
which as discussed, market participants are under no obligation to
utilize or purchase. In this competitive environment, potential
purchasers are free to choose which, if any, similar product to
purchase to satisfy their need for market information. As a result, the
Exchange believes this proposed rule change permits fair competition
among national securities exchanges.
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\25\ See, note 10, supra.
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The Exchange does not believe the proposed rule change would cause
any unnecessary or inappropriate burden on intramarket competition.
Particularly, the proposed fees would apply uniformly to any
subscriber, in that the Exchange would not differentiate between
subscribers that purchase the End of Day Volume Summary and all
subscribers would receive the same information in the data feed. The
Exchange believes the proposed fees are set at a modest level that
would allow interested subscribers to purchase such data based on their
business needs.
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) \26\ of the Act and subparagraph (f)(2) of Rule
19b-4 \27\ thereunder, because it establishes a due, fee, or other
charge imposed by the Exchange.
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\26\ 15 U.S.C. 78s(b)(3)(A).
\27\ 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) \28\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\28\ 15 U.S.C. 78s(b)(2)(B).
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[[Page 12752]]
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-2022-11 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-2022-11. 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-2022-11 and should be submitted
on or before March 28, 2022.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\29\
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\29\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-04673 Filed 3-4-22; 8:45 am]
BILLING CODE 8011-01-P
