Self-Regulatory Organizations; Nasdaq PHLX LLC; Suspension of and Order Instituting Proceedings To Determine Whether To Approve or Disapprove Proposed Rule Change To Amend the Exchange's Fees for Top of PHLX Options (TOPO), PHLX Orders, and TOPO Plus Orders, 45036-45044 [2024-11168]
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Federal Register / Vol. 89, No. 100 / Wednesday, May 22, 2024 / Notices
to Add International Priority Airmail,
Commercial ePacket, Priority Mail
Express International & Priority Mail
International Contract 9 to Competitive
Product List and Notice of Filing
Materials Under Seal; Filing Acceptance
Date: May 16, 2024; Filing Authority: 39
U.S.C. 3642, 39 CFR 3040.130 through
3040.135, and 39 CFR 3035.105; Public
Representative: Jennaca D. Upperman;
Comments Due: May 24, 2024.
2. Docket No(s).: MC2024–302 and
CP2024–310; Filing Title: USPS Request
to Add Priority Mail Express, Priority
Mail & USPS Ground Advantage
Contract 68 to Competitive Product List
and Notice of Filing Materials Under
Seal; Filing Acceptance Date: May 16,
2024; Filing Authority: 39 U.S.C. 3642,
39 CFR 3040.130 through 3040.135, and
39 CFR 3035.105; Public Representative:
Arif Hafiz; Comments Due: May 24,
2024.
3. Docket No(s).: MC2024–303 and
CP2024–311; Filing Title: USPS Request
to Add Priority Mail & USPS Ground
Advantage Contract 261 to Competitive
Product List and Notice of Filing
Materials Under Seal; Filing Acceptance
Date: May 16, 2024; Filing Authority: 39
U.S.C. 3642, 39 CFR 3040.130 through
3040.135, and 39 CFR 3035.105; Public
Representative: Nikki Brendemuehl;
Comments Due: May 24, 2024.
This Notice will be published in the
Federal Register.
Erica A. Barker,
Secretary.
[FR Doc. 2024–11212 Filed 5–21–24; 8:45 am]
BILLING CODE 7710–FW–P
[FR Doc. 2024–11227 Filed 5–21–24; 8:45 am]
On March 20, 2024, Nasdaq PHLX
LLC (‘‘Phlx’’ or ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’ or ‘‘SEC’’),
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2 a
proposed rule change (File Number SR–
Phlx–2024–15) to increase fees for
certain market data products
(‘‘Proposal’’). The proposed rule change
was immediately effective upon filing
with the Commission pursuant to
Section 19(b)(3)(A) of the Act.3 The
proposed rule change was published for
comment in the Federal Register on
March 28, 2024.4 Pursuant to Section
19(b)(3)(C) of the Act,5 the Commission
is hereby: (1) temporarily suspending
the proposed rule change; and (2)
instituting proceedings to determine
whether to approve or disapprove the
proposed rule change.
BILLING CODE 7710–12–P
POSTAL SERVICE
International Product Change—
International Priority Airmail,
Commercial ePacket, Priority Mail
Express International & Priority Mail
International Agreement
AGENCY:
ACTION:
The Postal Service gives
notice of filing a request with the Postal
Regulatory Commission to add an
International Priority Airmail,
Commercial ePacket, Priority Mail
Express International & Priority Mail
International contract to the list of
Negotiated Service Agreements in the
Competitive Product List in the Mail
Classification Schedule.
DATES: Date of notice: May 22, 2024.
FOR FURTHER INFORMATION CONTACT:
Christopher C. Meyerson, (202) 268–
7820.
Jkt 262001
Postal ServiceTM.
Notice.
The Postal Service gives
notice of filing a request with the Postal
Regulatory Commission to add an
International Priority Airmail,
Commercial ePacket, Priority Mail
Express International & Priority Mail
International contract to the list of
Negotiated Service Agreements in the
Competitive Product List in the Mail
Classification Schedule.
SUMMARY:
Date of notice: May 22, 2024.
The
United States Postal Service® hereby
gives notice that, pursuant to 39 U.S.C.
3642 and 3632(b)(3), on May 14, 2024,
it filed with the Postal Regulatory
Commission a USPS Request to Add
International Priority Airmail,
Commercial ePacket, Priority Mail
Express International & Priority Mail
International Contract 7 to Competitive
Product List. Documents are available at
www.prc.gov, Docket Nos. MC2024–297
and CP2024–304.
SUPPLEMENTARY INFORMATION:
Postal ServiceTM.
Notice.
SUMMARY:
khammond on DSKJM1Z7X2PROD with NOTICES
May 16, 2024.
Christopher C. Meyerson, (202) 268–
7820.
AGENCY:
17:06 May 21, 2024
Colleen Hibbert-Kapler,
Attorney, Ethics and Legal Compliance.
FOR FURTHER INFORMATION CONTACT:
International Product Change—
International Priority Airmail,
Commercial ePacket, Priority Mail
Express International & Priority Mail
International Agreement
VerDate Sep<11>2014
SECURITIES AND EXCHANGE
COMMISSION
DATES:
POSTAL SERVICE
ACTION:
The
United States Postal Service® hereby
gives notice that, pursuant to 39 U.S.C.
3642 and 3632(b)(3), on May 16, 2024,
it filed with the Postal Regulatory
Commission a USPS Request to Add
International Priority Airmail,
Commercial ePacket, Priority Mail
Express International & Priority Mail
International Contract 9 to Competitive
Product List. Documents are available at
www.prc.gov, Docket Nos. MC2024–301
and CP2024–309.
SUPPLEMENTARY INFORMATION:
Christopher Doyle,
Attorney, Ethics & Legal Compliance.
[FR Doc. 2024–11202 Filed 5–21–24; 8:45 am]
BILLING CODE 7710–12–P
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[Release No. 34–100160; File No. SR–Phlx–
2024–15]
Self-Regulatory Organizations; Nasdaq
PHLX LLC; Suspension of and Order
Instituting Proceedings To Determine
Whether To Approve or Disapprove
Proposed Rule Change To Amend the
Exchange’s Fees for Top of PHLX
Options (TOPO), PHLX Orders, and
TOPO Plus Orders
I. Introduction
II. Background and Description of the
Proposed Rule Change
The Exchange states that the purpose
of the proposed rule change is to amend
the Exchange’s proprietary data fees for
Top of PHLX Options (‘‘TOPO’’),6 PHLX
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A). A proposed rule change
may take effect upon filing with the Commission if
it is designated by the exchange as ‘‘establishing or
changing a due, fee, or other charge imposed by the
self-regulatory organization on any person, whether
or not the person is a member of the self-regulatory
organization.’’ 15 U.S.C. 78s(b)(3)(A)(ii).
4 See Securities Exchange Act Release No. 99841
(March 22, 2024), 89 FR 21648 (‘‘Notice’’). The
Commission has received one comment letter on
the proposed rule change. See Letter from Brookes
Ross, received April 29, 2024 (‘‘Ross Letter’’).
Comments received on the Proposal are available at:
https://www.sec.gov/comments/sr-phlx-2024-15/
srphlx202415.htm.
5 15 U.S.C. 78s(b)(3)(C).
6 See Notice, 89 FR at 21648 (citing Options 3,
Section 23(a)(1) (‘‘Top of PHLX Options (‘TOPO’) is
a direct data feed product that includes the
Exchange’s best bid and offer price, with aggregate
size, based on displayable order and quoting
interest on Phlx and last sale information for trades
executed on Phlx. The data contained in the TOPO
2 17
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Federal Register / Vol. 89, No. 100 / Wednesday, May 22, 2024 / Notices
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Orders,7 and TOPO Plus Orders at
Options 7, Section 10.8
The Exchange states that TOPO is a
direct data feed that provides
subscribers with PHLX Best Bid and
Offer (‘‘BBO’’) 9 and last sale
information.10 The Exchange also states
that the data distributed on TOPO is
identical to the data simultaneously sent
to the Options Price Reporting
Authority (‘‘OPRA’’).11 The Exchange
states that TOPO feed also provides
administrative information to facilitate
trading on the Exchange such as, for
example, the list of symbols trading on
a particular day.12 The Exchange states
that TOPO reduces the transmission and
data feed is identical to the data simultaneously
sent to the processor for the OPRA and subscribers
of the data feed. The data provided for each options
series includes the symbols (series and underlying
security), put or call indicator, expiration date, the
strike price of the series, and whether the option
series is available for trading on Phlx and identifies
if the series is available for closing transactions
only.’’)).
7 See Notice, 89 FR at 21648 (citing Options 3,
Section 23(a)(1) (‘‘PHLX Orders is a real-time full
Limit Order book data feed that provides pricing
information for orders on the PHLX Order book for
displayed order types as well as market participant
capacity. PHLX Orders is currently provided as part
of the TOPO Plus Orders data product. PHLX
Orders provides real-time information to enable
users to keep track of the single and complex order
book(s). The data provided for each options series
includes the symbols (series and underlying
security), put or call indicator, expiration date, the
strike price of the series, leg information on
complex strategies and whether the option series is
available for trading on Phlx and identifies if the
series is available for closing transactions only. The
feed also provides auction and exposure
notifications and order imbalances on opening/
reopening (size of matched contracts and size of the
imbalance)’’)).
8 The proposed changes were initially filed on
November 16, 2023, as SR–Phlx–2023–51. On
December 5, 2023, SR–Phlx–2023–51 was
withdrawn and replaced with SR–Phlx–2023–57.
On January 29, 2024, SR–Phlx–2023–57 was
withdrawn and replaced with SR–Phlx 2024–03. On
March 20, 2024, SR–Phlx–2024–03 was withdrawn
and replaced with the instant filing to provide
additional detail regarding the proposal. See Notice,
89 FR at 21648.
9 See Notice, 89 FR at 21648. The Exchange states
that Best Bid and Offer includes aggregate size
information based on displayable order and quoting
interest on the Exchange. Id. at n.6.
10 See Notice, 89 FR at 21648 (citing PHLX, ‘‘Top
of Phlx Options,’’ available at https://www.nasdaq
trader.com/Micro.aspx?id=TOPO#:∼:text=Top%20
of%20PHLX%20Options%20(TOPO,in%20the%20
consolidated%20market%20feed).
11 See Notice, 89 FR at 21648 (citing Options 3
(Options Trading Rules), Section 23(a)(1) (Data
Feeds and Trade Information) (‘‘The data contained
in the TOPO data feed is identical to the data
simultaneously sent to the processor for the OPRA
and subscribers of the data feed.’’)).
12 See Notice, 89 FR at 21648 (citing Nasdaq,
‘‘Top of Phlx Options Interface Specifications,
Version 3.4’’ Section 4.3 available at https://
www.nasdaqtrader.com/content/technicalsupport/
specifications/dataproducts/topofphlx.pdf
(describing the start of day options directory
message, which lists all symbols eligible for the
auction process)).
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17:06 May 21, 2024
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processing latencies for top of book
information relative to the OPRA feed
by avoiding the latencies generated by
the latter in consolidating data.13 The
Exchange states that monthly fees for
TOPO are currently $2,000 for Internal
Distributors,14 $2,500 for External
Distributors,15 $1 for a Non-Professional
Subscriber,16 and $40 for a Professional
Subscriber.17 The Exchange further
states that none of these fees have
changed for over a decade since January
2013.18
The Exchange states that PHLX
Orders is a real-time order book feed
with pricing information for displayed
orders on the PHLX order book.19 The
Exchange states that the data provided
for each options series includes the
symbols (series and underlying
security), a put or call indicator,
expiration date, and the strike price of
the series.20 The Exchange states that it
also provides the real-time status of
simple and complex orders 21 on the
13 See
Notice, 89 FR at 21648.
Notice, 89 FR at 21648 (citing Options 7,
Section 10 (Proprietary Data Feed Fees) (Top of
PHLX Options) (‘‘A ‘distributor’ of Nasdaq PHLX
data is any entity that receives a feed or data file
. . . directly from Nasdaq PHLX or indirectly
through another entity and then distributes it either
internally (within that entity) or externally (outside
that entity). All distributors execute a Nasdaq PHLX
distributor agreement.’’)).
15 See Notice, 89 FR at 21648 (citing Options 7,
Section 10 (Proprietary Data Feed Fees) (Top of
PHLX Options)).
16 See Notice, 89 FR at 21648 (citing Options 7,
Section 10 (Proprietary Data Feed Fees) (Top of
PHLX Options) (‘‘A Non-Professional Subscriber is
a natural person who is neither: (i) registered or
qualified in any capacity with the Commission, the
Commodities Futures Trading Commission, any
state securities agency, any securities exchange or
association, or any commodities or futures contract
market or association; (ii) engaged as an ‘investment
adviser’ as that term is defined in Section 201(11)
of the Investment Advisors Act of 1940 (whether or
not registered or qualified under that Act); nor (iii)
employed by a bank or other organization exempt
from registration under federal or state securities
laws to perform functions that would require
registration or qualification if such functions were
performed for an organization not so exempt. A
Non-Professional Subscriber may only use the data
provided for personal purposes and not for any
commercial purpose.’’)).
17 See Notice, 89 FR at 21648 (citing Options 7,
Section 10 (Proprietary Data Feed Fees) (Top of
PHLX Options) (‘‘A Professional Subscriber is any
Subscriber that is not a Non-Professional
Subscriber. If the Nasdaq Subscriber agreement is
signed in the name of a business or commercial
entity, such entity would be considered a
Professional Subscriber.’’)).
18 See Notice, 89 FR at 21649 (citing Securities
Exchange Act Release No. 68576 (January 3, 2013),
78 FR 1886 (January 9, 2013) (SR–Phlx–2012–145)).
19 See Notice, 89 FR at 21649 (citing Options 3
(Options Trading Rules), Section 23(a)(2) (Data
Feeds and Trade Information)).
20 See Notice, 89 FR at 21649.
21 See Notice, 89 FR at 21649 (citing Options 3
(Options Trading Rules), Section 23(a)(2) (Data
Feeds and Trade Information); Section 14(a)(i)
(‘‘Complex Order. For purposes of the electronic
14 See
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45037
order book, including new orders and
changes to orders resting on the PHLX
book for all PHLX-listed options.22 The
Exchange states that PHLX Orders feed
includes data on the opening imbalance,
Price Improvement XL (PIXL),23 and
Complex Order Live Auction (COLA).24
The Exchange further states that a
notification message is sent for symbols
entering an auction.25 The Exchange
states that PHLX Orders also furnishes
an historical record of all simple and
complex order message data from the
PHLX Orders data feed and that PHLX
Orders information is not sent to
OPRA.26
The Exchange states that PHLX
Orders is an alternative to PHLX Depth
of Market and is an optimized technical
channel designed to lower technology
costs, reduce processing time, and
facilitate the ingestion of data while still
providing customers insight beyond the
top of book by viewing active buy and
sell orders.27 The Exchange further
states that PHLX Orders excludes
quotations by market makers and other
authorized entities that is included in
PHLX Depth of Market.28 Regarding the
trading of Complex Orders, a Complex Order is an
order involving the simultaneous purchase and/or
sale of two or more different options series in the
same underlying security, priced as a net debit or
credit based on the relative prices of the individual
components, for the same account, for the purpose
of executing a particular investment strategy.’’)).
22 See Notice, 89 FR at 21649 (citing Nasdaq,
‘‘PHLX Orders,’’ available at https://
www.nasdaqtrader.com/Micro.aspx?
id=PHLXOrders).
23 See Notice, 89 FR at 21649 (citing Options 3
(Options Trading Rules), Section 23(a)(2); Section
13 (Price Improvement XL) (‘‘A member may
electronically submit for execution an order it
represents as agent on behalf of a Public Customer,
broker-dealer, or any other entity (‘PIXL Order’)
against principal interest or against any other order
(except as provided in sub-paragraph (a)(6) below)
it represents as agent (an ‘Initiating Order’)
provided it submits the PIXL Order for electronic
execution into the PIXL Auction (‘Auction’)
pursuant to this Rule.’’)).
24 See Notice, 89 FR at 21649 (citing Options 3,
Section 14(e) which describes the process for the
Complex Order Live Auction (‘‘COLA’’)).
25 Notice, 89 FR at 21649 (citing Nasdaq, ‘‘PHLX
Orders Interface Specification,’’ (Version 1.92)
available at https://www.nasdaqtrader.com/content/
technicalsupport/specifications/dataproducts/
topoplusorders.pdf (describing auction notification
message)).
26 See Notice, 89 FR at 21649 (citing Limited
Liability Company Agreement of Options Price
Reporting Authority, LLC Article V, Section 5.2(c)(i)
(January 1, 2010), available at https://assets.websitefiles.com/5ba40927ac854d8c97bc92d7/
5d0bd57d87d3ccca102102d7lOPRA%20Plan%20
with%20Updated%20Exhibit%20A%20-%2006-192019.pdf (describing last sale and best bid and offer
information disseminated by OPRA)).
27 See Notice, 89 FR at 21649.
28 See Notice, 89 FR at 21649 (citing Options 3
(Options Trading Rules), Section 23(a)(3) (Data
Feeds and Trade Information) (‘‘PHLX Depth of
Market is a data product that provides: (i) order and
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45038
Federal Register / Vol. 89, No. 100 / Wednesday, May 22, 2024 / Notices
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utility of an orders-only data feed, the
Exchange states that it provides
customers with the opportunity to
reduce bandwidth (and therefore data
processing costs) by several orders of
magnitude relative to the full depth of
book feed, while retaining a view of
market participant orders (setting aside
symbols where participants have not
placed orders).29
The Exchange states that the
December 2023 bandwidth report shows
that the PHLX Depth of Market feed
transmitted a maximum of 14.3 billion
messages per day during the month of
December, while the PHLX Orders feed
transmitted a maximum of 53.6 million
messages over the same period (41.5
million messages for simple orders, and
12.1 million messages for complex
orders).30 The Exchange states that it’s
full depth of book feed requires the
customer to process over 200 times
more messages than the orders feed over
the course of a day; replacing a depth
of book feed with an orders feed allows
a customer to reduce the maximum
number of daily messages it receives by
99.6%.31 The Exchange states that, to
cite another example, the 1 millisecond
bandwidth peak for PHLX Depth of
Market was 13.96 million messages; the
comparable number of messages for
orders was 1.45 million (891 thousand
for simple and 561 thousand for
complex orders).32 The Exchange states
that replacing depth of book with orders
can therefore reduce the number of
messages processed at peak at the 1
millisecond bandwidth by nearly
90%.33 The Exchange further states that
approximately 56% of customers who
take any data feed at all from the PHLX
exchange take an orders feed (either
Orders only or TOPO Plus Orders)
without depth of book, another 38% of
customers take both orders and depth
feeds, and the remaining 6% take either
top of book or depth of book alone.34
The Exchange states that in general,
firms that only need information on
actively trading options takes an order
quotation information for individual quotes and
orders on the order book . . .’’) (emphasis added);
Section 4(b) (Entry and display of Quotes)
(identifying the market participants authorized to
submit quotes to the Exchange)).
29 See Notice, 89 FR at 21649.
30 See Notice, 89 FR at 21649 (citing Nasdaq,
‘‘December 2023 Bandwidth Report,’’ available at
https://view.officeapps.live.com/op/
view.aspx?src=https%3A%2F%2
Fwww.nasdaqtrader.com%2Fcontent%2
Ftechnicalsupport%2Fspecifications%2
Fdataproducts%2Fbandwidthreport.xls&wdOrigin=
BROWSELINK).
31 See Notice, 89 FR at 21649.
32 See Notice, 89 FR at 21649.
33 See Notice, 89 FR at 21649.
34 See Notice, 89 FR at 21649.
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feed in lieu of depth.35 The Exchange
explains that there are a great number of
use cases that fit this broad description,
but, for purposes of illustration, the
Exchange is aware of at least two such
types of customers.36 The Exchange
states that the first is the market
participant that does not engage in order
routing—and that these are broker
dealers that use third parties to route
orders, either because the originating
broker-dealer is not a member of the
exchange or to save costs.37 The
Exchanges states that without the need
for additional information to inform
routing decisions, such customers often
focus on active trading alone, and
therefore purchase the orders feed.38
The Exchange states that a second
category of customers are those that use
options data to analyze trends in other
markets.39 The Exchange explains that
one example of this type of customer is
the equity trader that analyzes equitybased options to gauge market sentiment
in the underlying equity.40 The
Exchange states that for such customers,
there is relatively little utility in the full
depth feed, given that market sentiment
is best gauged using options that are
being actively traded, rather than those
that are dormant.41
The Exchange states that there are
some customers that purchase both
orders and depth and that vendors are
one example of this type of customer,
purchasing market data solely for resale,
not for trading on behalf of themselves
or others.42 The Exchange explains that
another example is the firm that uses
orders for analysis and depth for order
routing.43 The Exchange states that the
orders feed can be useful for assessing
sentiment in equity markets, while
depth is often used in order routing
decisions.44 The Exchange states that
firms that engage in both functions can
lower overall processing requirements
by using orders for analytics and depth
for routing.45
The Exchange states that purchase of
PHLX Orders is optional and that
customers can obtain all of the data
contained in PHLX Orders from PHLX
Depth of Market feed, and may purchase
the latter if they do not realize the cost
savings offered by PHLX Orders.46 The
35 See
Notice, 89 FR at 21649.
Notice, 89 FR at 21649.
37 See Notice, 89 FR at 21649.
38 See Notice, 89 FR at 21649.
39 See Notice, 89 FR at 21649.
40 See Notice, 89 FR at 21649.
41 See Notice, 89 FR at 21649.
42 See Notice, 89 FR at 21649.
43 See Notice, 89 FR at 21649.
44 See Notice, 89 FR at 21649.
45 See Notice, 89 FR at 21649.
46 See Notice, 89 FR at 21650.
36 See
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Fmt 4703
Sfmt 4703
Exchange states that PHLX Orders is a
derivative product designed as a lowercost alternative to a depth of book
feed.47 The Exchange further states that
it is not a complement to any other
product offered by the Exchange or any
of its competitors.48 The Exchange
explains that customers are free to
purchase PHLX Orders or not, and can
reject the feed for any reason, including
the fee charged.49 The Exchange states
that the current monthly fees for PHLX
Orders are $3,000 for Internal
Distributors, $3,500 for External
Distributors, $1 for a Non-Professional
Subscriber, and $40 for a Professional
Subscriber.50 The Exchange further
states that none of these fees have
changes for over a decade since January
2013.51
The Exchange states that TOPO Plus
is a direct market data product that
offers subscribers both TOPO and PHLX
Orders for a consolidated fee that is less
than the combined fee of the two
products.52 The Exchange states that the
monthly fees for TOPO Plus Orders are
currently $4,500 for Internal
Distributors, $5,000 for External
Distributors, $1 for a Non-Professional
Subscriber, and $40 for a Professional
Subscriber.53 The Exchange states that
Internal Distributor fees for TOPO Plus
Orders were modified in January 2018,
over five years ago,54 but the other
TOPO Plus Orders fees have not
changed since January 2013.55
The Exchange states that different
types of market participants purchase
TOPO, PHLX Orders and TOPO Plus
Orders, including market makers,
vendors, banks, proprietary traders,
agency brokers (brokers that route trades
on behalf of other market participants),
hedge funds, index providers and other
firms.56 The Exchange states that in
characterizing market participants, it
must be clear that firms use data feeds
for multiple tasks.57 The Exchange
states that a market maker, for example,
may use market data for order routing,
47 See
Notice, 89 FR at 21650.
Notice, 89 FR at 21650.
49 See Notice, 89 FR at 21650.
50 See Notice, 89 FR at 21650.
51 See Notice, 89 FR at 21650 (citing Securities
Exchange Act Release No. 68576 (January 3, 2013),
78 FR 1886 (January 9, 2013) (SR–Phlx–2012–145)).
52 See Notice, 89 FR at 21650 (citing PHLX, TOPO
Plus PHLX Orders, available at https://www.nasdaq
trader.com/Micro.aspx?id=TOPOPlusOrders).
53 See Notice, 89 FR at 21650.
54 See Notice, 89 FR at 21650 (citing Securities
Exchange Act Release No. 82495 (January 12, 2018),
83 FR 2839 (January 19, 2018) (SR–Phlx–2018–08)).
55 See Notice, 89 FR at 21650 (citing Securities
Exchange Act Release No. 68576 (January 3, 2013),
78 FR 1886 (January 9, 2013) (SR–Phlx–2012–145)).
56 See Notice, 89 FR at 21650.
57 See Notice, 89 FR at 21650.
48 See
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Federal Register / Vol. 89, No. 100 / Wednesday, May 22, 2024 / Notices
or for risk analysis used in quoting in
their assigned option series.58 The
Exchange states that banks may use
market data for prime brokerage
services, proprietary trading, or risk
management.59 The Exchange states that
market data vendors do not directly use
the data at all, but rather disseminate
data to market participants that use the
data for a multiplicity of purposes.60
The Exchange states that other firms
purchase options data to assess the
value of equity securities.61
The Exchange explains that,
characterizing firms based on what the
Exchange understands to be their
primary market activity, and
understanding that firms play multiple
roles, the Exchange estimates that
approximately half of the customers that
take top of book data in any form, in
combination with other products or
alone, are market makers, and the
remaining half are market data vendors,
banks, proprietary traders, agency
brokers, hedge funds, index providers,
and others.62 The Exchange explains
that roughly the same distribution
applies to customers that purchase
PHLX Orders, whether alone or in
combination with other products.63 The
Exchange states that although the
distributions are roughly similar,
different customers are purchasing
different products in different
combinations.64
The Exchange states that firms
generally purchase PHLX Orders rather
than depth of book data to lower
technology costs and reduce processing
time, while still providing customers
insight into open executable orders that
could impact the BBO.65 The Exchange
states that a more specific explanation
of how TOPO, PHLX Orders and TOPO
Plus Orders is used will vary based on
use case, with many firms employing
multiple use cases.66 The Exchange
states that market makers, banks, hedge
funds, and proprietary traders often use
top of book and orders feeds for trading,
order routing and analysis.67 The
Exchange states that banks may use
58 See
Notice, 89 FR at 21650.
Notice, 89 FR at 21650.
60 See Notice, 89 FR at 21650.
61 See Notice, 89 FR at 21650. The Exchange
states that it does not include ‘‘High Frequency
Trading Firm’’ as a distinct category because many
market participant may engage in low latency
trading strategies to some degree, but the Exchange
does not have sufficient information to be able to
characterize any particular firm as a high frequency
trader. Id.
62 See Notice, 89 FR at 21650.
63 See Notice, 89 FR at 21650.
64 See Notice, 89 FR at 21650.
65 See Notice, 89 FR at 21650.
66 See Notice, 89 FR at 21650.
67 See Notice, 89 FR at 21650.
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market data for prime brokerage
services, proprietary trading, or risk
management.68 The Exchange states that
clients of market data vendors will
utilize the data for many different
purposes.69 The Exchange explains that
it does not have sufficient visibility into
customers’ businesses and proprietary
processes to be able to determine
precise data usage by customer
category.70
The Exchange states that: for TOPO, it
proposes to increase the monthly charge
for Internal Distributors from $2,000 to
$2,500, and the monthly charge for
External Distributors from $2,500 to
$3,000; For PHLX Orders, it proposes to
increase the monthly charge for Internal
Distributors from $3,000 to $3,500, and
the monthly charge for External
Distributors from $3,500 to $4,000; and
for TOPO Plus Orders, it proposes to
increase the monthly charge for Internal
Distributors from $4,500 to $5,500, and
the monthly charge for External
Distributors from $5,000 to $6,000.71
The Exchange states that no changes are
proposed for Non-Professional and
Professional Subscriber fees for TOPO,
Phlx Orders, or TOPO Plus.72 The
Exchange further states that the
proposed changes are designed to
update data fees to reflect their current
value, rather than their value when
these fees were set 5 or 10 years ago.73
III. Suspension of the Proposed Rule
Change
Pursuant to Section 19(b)(3)(C) of the
Act,74 at any time within 60 days of the
date of filing of an immediately effective
proposed rule change pursuant to
Section 19(b)(1) of the Act,75 the
Commission summarily may
temporarily suspend the change in the
rules of a self-regulatory organization
(‘‘SRO’’) 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. A temporary suspension of the
proposed rule changes is necessary and
appropriate to allow for additional
analysis of the proposed rule change’s
consistency with the Act and the rules
thereunder.
Notice, 89 FR at 21650.
Notice, 89 FR at 21650.
70 See Notice, 89 FR at 21650.
71 See Notice, 89 FR at 21650.
72 See Notice, 89 FR at 21650.
73 See Notice, 89 FR at 21650.
74 15 U.S.C. 78s(b)(3)(C).
75 15 U.S.C. 78s(b)(1).
A. Exchange Statements in Support of
the Proposal
In support of the Proposal, the
Exchange states that it believes that its
proposal is consistent with Section 6(b)
of the Act,76 in general, and furthers the
objectives of Sections 6(b)(4) and 6(b)(5)
of the Act,77 in particular, in that it
provides for the equitable allocation of
reasonable dues, fees and other charges
among members and issuers and other
persons using any facility, and is not
designed to permit unfair
discrimination between customers,
issuers, brokers, or dealers.78 The
Exchange explains that this belief is
based on several factors: First, the
Exchange states that exchange fees are
constrained because market participants
can choose among seventeen different
venues for options trading, and
therefore no single venue can charge
excessive fees without losing customers
and market share.79 Second, the
Exchange states that fees for TOPO are
constrained because the identical top of
book data is sent to OPRA, and certain
market participants may choose to rely
exclusively on OPRA rather than
purchasing the proprietary data
product.80 Third, the Exchange states
that the purchase of PHLX Orders is
optional, that it is designed as a lowercost alternative to depth of book—and,
as such, is not a complement to any
other product offered by the Exchange
or any of its competitors, and that
customers may purchase PHLX Orders
or not, and can reject the feed for any
reason—including the fee charged.81
Fourth, the Exchange states that the
proposed fees are comparable to, and in
some cases less than, those of similarly
situated exchanges.82 Fifth, the
Exchange states that the current fees do
not properly reflect the value of the
underlying product, as fees for the
products in question have been static in
nominal terms, and therefore falling in
real terms (due to inflation), while the
amount of information transmitted in
those fees have more than doubled in
just the past five years, reflecting a
substantial increase in customer value
due to the significantly higher levels of
liquidity currently available on the
Exchange.83 Sixth, the Exchange states
that higher fees for the external
distribution of TOPO, PHLX Orders, and
TOPO Plus Orders are based on the
68 See
76 15
69 See
77 15
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U.S.C. 78f(b).
U.S.C. 78f(b)(4) and (5).
78 See Notice, 89 FR at 21650.
79 See Notice, 89 FR at 21650.
80 See Notice, 89 FR at 21650.
81 See Notice, 89 FR at 21650.
82 See Notice, 89 FR at 21650.
83 See Notice, 89 FR at 21650–51.
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additional value vendors receive from
distributing data to their own customers
and typically charging for the service.84
The Exchange states that customers
face many choices in where to trade
options. The Exchange explains that
until recently, sixteen exchanges have
offered options trading services, and
they are now being joined by a 17th
member.85 The Exchange states that not
a single options exchange trades more
than 11 percent of the options market by
volume.86 The Exchange states that
PHLX, the second largest options
exchange by volume, only has 9 percent
of the options market.87 The Exchange
states that only one of the 17 options
exchanges have a market share over 10
percent.88 The Exchange states that this
broad dispersion of market share
demonstrates that market participants
can and do exercise choice in options
trading venues.89 The Exchange also
states that as the number of exchanges
continues to grow, competition will
become fiercer and customer choice will
continue to expand.90
The Exchange states that most option
contracts on the TOPO, TOPO Plus, and
Orders data feeds are traded on multiple
exchanges.91 The Exchange states that a
sample of trading on March 7, 2024,
from The Options Clearing Corporation
shows that 5,836 symbols were traded
on PHLX’s options exchange, of which
only 53 symbols were listed on the
PHLX options exchange only, and
another 33 symbols were listed on
multiple Nasdaq-affiliated options
exchanges.92
The Exchange states that, in order to
remain competitive with other options
84 See
Notice, 89 FR at 21651.
Notice, 89 FR at 21651 (citing OPRA Plan,
list of OPRA Participant Exchanges, available at
https://www.opraplan.com/faqs, and Securities
Exchange Act Release No. 98388 (September 14,
2023), 88 FR 64963 (September 20, 2023) (File No.
4–443) (‘‘Joint Industry Plan; Notice of Filing and
Immediate Effectiveness of Amendment to the Plan
for the Purpose of Developing and Implementing
Procedures Designed To Facilitate the Listing and
Trading of Standardized Options To Add MEMX
LLC as a Plan Sponsor’’)). The Exchange states that
all options exchanges are members of the OPRA
Plan. Id.
86 See Notice, 89 FR at 21651 (citing Nasdaq,
Options Market Statistics (Last updated November
3, 2023), available at https://www.nasdaq
trader.com/Trader.aspx?id=OptionsVolume
Summary). The Exchange states that on November
3, 2023, the total percentage of options market
volume by exchange was as follows: ARCA: 11%;
PHLX: 9%; CBOE: 9%; BOX: 8%; ISE: 7%; EDGX:
7%; AMEX: 7%; MIAX: 7%; MPRL: 7%; NOM: 6%;
BATS: 6%; C2: 5%; EMLD: 4%; MRX: 3%; GEMX:
3%; BXOP: 3%; MEMX: 0%. Id.
87 See Notice, 89 FR at 21651.
88 See Notice, 89 FR at 21651.
89 See Notice, 89 FR at 21651.
90 See Notice, 89 FR at 21651.
91 See Notice, 89 FR at 21651.
92 See Notice, 89 FR at 21651.
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exchanges, PHLX, like some options
exchanges, offers several proprietary
options products that are only traded on
Nasdaq-affiliated exchanges.93 The
Exchange states that these include
products based on the Nasdaq 100®
Index, such as NDX (Nasdaq 100 Index
on PHLX, Nasdaq GEMX, LLC
(‘‘GEMX’’) and Nasdaq ISE, LLC
(‘‘ISE’’)), XND (Nasdaq 100 Micro Index
on PHLX and ISE), and NQX (Nasdaq
100 Micro Index on ISE), as well as
volatility products such as VOLQ
(Nasdaq-100® Volatility Index), foreign
currency options, and other products.94
The Exchange states that some Nasdaq
option proprietary products are subject
to direct, substitution-based competition
from other options exchanges and that
all Nasdaq option proprietary products
are subject to the competition among
exchanges for membership and market
share.95 The Exchange states that
examples of substitution-based
competition include the VOLQ, which
can be substituted with the Cboe
Volatility Index® (‘‘VIX’’).96 The
Exchange states that NDX (listed in
PHLX, GEMX and ISE), XND (listed on
PHLX and ISE) and NQX (listed on ISE)
all offer different ways of gaining
exposure to the Nasdaq 100® Index, are
therefore each serves as a direct
substitute for the others.97 The
Exchange also states that the Nasdaq
100® Index products also have
alternatives among other exchanges.98
93 See
Notice, 89 FR at 21651.
Notice, 89 FR at 21651. The Exchange
states that the NASDAQ–100 is an index which
includes 100 of the world’s largest non-financial
companies listed on the wider NASDAQ Stock
market, based on their market capitalization. See
Notice, 89 FR at 21651.
95 See Notice, 89 FR at 21651.
96 See Notice, 89 FR at 21651 (citing Securities
Exchange Act Release No. 95170 (June 29, 2022), 87
FR 40295 (July 6, 2022) (SR–Phlx–2022–27)
(explaining that the Nasdaq-100® Volatility Index
(‘‘VOLQ’’) is subject to ‘‘significant substitutionbased competitive forces; market participants can
substitute options on VOLQ for products offered by
other exchanges, for example, the options on the
Cboe Volatility Index® (‘‘VIX’’).’’)).
97 See Notice, 89 FR at 21651 (citing Securities
Exchange Act Release No. 99141 (December 12,
2023), 88 FR 87466 (December 18, 2023) (SR–Phlx–
2023–55) (‘‘[M]arket participants are offered
different ways to gain exposure to the Nasdaq 100
Index, whether through the Exchange’s proprietary
products like options overlying NDX, NDPX, or
XND, or separately through multi-listed options
overlying Invesco QQQ Trust (‘‘QQQ’’); Securities
Exchange Act Release No. 99171 (December 14,
2023), 88 FR 88206 (December 20, 2023) (SR–ISE–
2023–36) (explaining that NDX, XND and NQX
provide ‘‘market participants with a variety of
choices in selecting the product they desire to
utilize in order to gain exposure to the Nasdaq 100
Index.’’)).
98 See Notice, 89 FR at 21651 (citing Securities
Exchange Act Release No. 99141 n.7 (December 12,
2023), 88 FR 87466 (December 18, 2023) (SR–Phlx–
2023–55) (explaining that the fees for NDX and
94 See
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The Exchange states that exchange
proprietary products are also subject to
competition among exchanges for
membership and market share.99 The
Exchange states that there are many
factors that may cause a market
participant to decide to become a
member of a particular exchange; among
these are product offerings.100 The
Exchange states that introducing new
and innovative products to the
marketplace designed to meet customer
demands may attract market
participants to become a member of a
particular options venue by allowing
market participants greater trading
opportunities and new avenues to
manage risks.101 The Exchange states
that an exchange’s proprietary product
offering may attract order flow to a
particular exchange to trade a particular
options product and generally make that
exchange a more desirable venue to
transaction options, thereby attracting
membership to that exchange.102
The Exchange states that, in light of
the number of trading venues available
to customers, the Exchange must price
its products, including TOPO, PHLX
Orders, and TOPO Plus Orders (as well
as other products), competitively,
otherwise customers would move to
other venues.103 The Exchange states
that, ‘‘[i]f competitive forces are
operative, the self-interest of the
exchanges themselves will work
powerfully to constrain unreasonable or
unfair behavior’’ and, accordingly, ‘‘the
existence of significant competition
provides a substantial basis for finding
that the terms of an exchange’s fee
proposal are equitable, fair, reasonable,
and not unreasonably or unfairly
discriminatory.’’ 104
The Exchange states that the top of
book data in TOPO is sent to OPRA;
under OPRA rules, proprietary options
information is available to customers
that have equivalent access to OPRA
information, and therefore is
supplementary to the OPRA feed.105
NDXP are in line with fees assessed by Cboe on its
MXEA and MXEF options products)).
99 See Notice, 89 FR at 21651 (citing Securities
Exchange Act Release No. 95170 (June 29, 2022), 87
FR 40295 (July 6, 2022) (SR–Phlx–2022–27)
(discussing the role of proprietary data products in
the competition among exchanges)).
100 See Notice, 89 FR at 21651.
101 See Notice, 89 FR at 21651.
102 See Notice, 89 FR at 21651.
103 See Notice, 89 FR at 21651.
104 See Notice, 89 FR at 21651 (citing Securities
Exchange Act Release No. 59039 (December 2,
2008), 73 FR 74,770 (December 9, 2008) (SR–
NYSEArca–2006–21)).
105 See Notice, 89 FR at 21651 (citing Limited
Liability Company Agreement of Options Price
Reporting Authority, LLC § 5.2(c)(iii) (January 1,
2010), available at https://assets.website-files.com/
5ba40927ac854d8c97bc92d7/
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The Exchange states that, specifically,
Section 5.2(c)(iii) of the OPRA Plan
provides that ‘‘[a] Member [of the OPRA
Plan] may disseminate its Proprietary
Information,’’ provided that ‘‘such
dissemination is limited to other
Members and to persons who also have
equivalent access to consolidated
Options Information disseminated by
OPRA for the same classes or series of
options that are included in the
Proprietary Information. . . .’’ 106 The
Exchange states that ‘‘Consolidated
Options Information’’ refers to
‘‘consolidated Last Sale Reports
combined with either consolidated
Quotation Information or the BBO
furnished by OPRA’’ and that access is
deemed to be ‘‘equivalent’’ ‘‘if both if
both kinds of information are equally
accessible on the same terminal or work
station. . . .’’ 107
The Exchange states that any
customer that purchases proprietary
options data from the Exchange,
including TOPO and TOPO Plus Orders,
must also have equivalent access to the
OPRA Plan.108 The Exchange states that
the best bid and offer and last sale
information available from TOPO and
TOPO Plus Orders fees is identical to
the information simultaneously sent to
OPRA by the Exchange and that OPRA
provides NBBO and last sale
information on options transactions.109
The Exchange states that TOPO and
TOPO Plus Orders provide additional
administrative information unique to
trading on the Exchange, and also
reduce the transmission and processing
latencies generated through the process
of consolidating data into the OPRA
feed.110 The Exchange states that
because top of book and last sale
information is available on OPRA as
5d0bd57d87d3ccca102102d7_
OPRA%20Plan%20with%20Updated%20
Exhibit%20A%20-%2006-19-2019.pdf (‘‘OPRA
Plan’’)).
106 See Notice, 89 FR at 21651 (citing Section
5.2(c)(iii) of the OPRA Plan).
107 See Notice, 89 FR at 21652 (citing Section
5.2(c)(iii) of the OPRA Plan).
108 See Notice, 89 FR at 21652.
109 See Notice, 89 FR at 21652. The Exchange
states that the TOPO feed includes administrative
information (but not data) that is not provided on
the OPRA feed, such as symbol directory messages.
See Notice, 89 FR at 21652 (citing Nasdaq, ‘‘Top of
Phlx Options Interface Specifications, Version 3.4’’
Section 4.3 available at https://www.nasdaq
trader.com/content/technicalsupport/
specifications/dataproducts/topofphlx.pdf
(describing the start of day options directory
message, which lists all symbols eligible for the
auction process)).
110 See Notice, 89 FR at 21652. The Exchange
states that bid and offer and last sale information
provided with the TOPO Plus Orders product is
identical to the data sent to OPRA, although the
‘‘orders’’ component of TOPO Plus Orders is not.
Id.
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well as TOPO, and customers who
purchase TOPO have equivalent access
to the OPRA feed, certain customers
may choose to rely on the OPRA feed in
lieu of purchasing PHLX data, thereby
limiting the ability of the Exchange from
charging excessive fees for its TOPO and
TOPO Plus Orders feeds.111
The Exchange states that purchase of
PHLX Orders is optional and that
customers can obtain all of the data
contained in PHLX Orders from PHLX
Depth of Market feed, and may purchase
the latter if they do not realize the cost
savings offered by PHLX Orders.112 The
Exchange states that PHLX Orders is not
a complement to any other product
offered by the Exchange or any of its
competitors; customers are free to
purchase PHLX Orders or not, and can
reject the feed for any reason, including
the fee charged.113
The Exchange states that the proposed
fees are comparable to, and in some
cases less than, those of other similarly
situated exchange fees.114 The Exchange
states that options market statistics
show that PHLX has a market share of
approximately 9%, and that ARCA, with
an 11% market share, and CBOE, with
a 9% market share, are its closest
competitors.115 The Exchange states that
to obtain top of book and depth of book
information for internal distribution
(including both simple and complex
options) from ARCA, a customer would
be required to pay an Access Fee of
$3,000 per month, a Non-Display fee of
at least $5,000 per month for simple
options, and a Non-Display fee of $1,000
for Complex Options, for a total of
$9,000 per month.116 The Exchange
states that to obtain the same
information from PHLX under the new
proposal, a customer would pay the
Internal Distributor fee of $2,500 for
TOPO, and an Internal Distributor fee of
$4,000 for PHLX Depth Data, for a total
of $6,500 per month.117 The Exchange
111 See
Notice, 89 FR at 21652.
Notice, 89 FR at 21652.
113 See Notice, 89 FR at 21652.
114 See Notice, 89 FR at 21652.
115 See Notice, 89 FR at 21652 (citing Nasdaq,
Options Market Statistics (Last updated November
3, 2023), available at https://www.nasdaq
trader.com/Trader.aspx?id=OptionsVolume
Summary).
116 See Notice, 89 FR at 21652 (citing NYSE Arca
Options Proprietary Market Data Fees (as of July 3,
2023), available at https://www.nyse.com/
publicdocs/nyse/data/NYSE_Arca_Options_
Proprietary_Data_Fee_Schedule.pdf).
117 See Notice, 89 FR at 21652 (citing Options 7,
Section 10 (Proprietary Data Feed Fees) (PHLX
Depth Data)). The Exchange states that ARCA does
not charge separately for top of book and depth of
book. Id. The Exchange states that although PHLX
is not proposing to change fees for depth of book
information, PHLX depth of book information is
included here to maintain comparability. Id.
112 See
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45041
states that to obtain comparable
information for Cboe Options, a
customer would be required to pay a
combined fee of $9,000 per month.118
The Exchange states that a PHLX
customer would pay the Internal
Distributor fee of $2,500 for TOPO, and
an Internal Distributor fee of $4,000 for
PHLX Depth Data, for a total of $6,500
per month.119 The Exchange states that
as such, the proposed fees are
comparable to fees charged by industry
peers, and therefore presumptively
reasonable.120
The Exchange states that the Internal
Distributor fee for TOPO Plus Orders
was increased in 2018, while none of
the other fees have changed for over a
decade, since January 2013, and that
this means that fees for TOPO, PHLX
Orders, and TOPO Plus Orders have
fallen in real terms due to inflation.121
The Exchange explains that, using data
generated by the Department of
Commerce to estimate inflation in the
market for portfolio management and
investment services, inflation has
increased prices by 63.9% since January
2013, when most of the fees at issue
were set, and 15.7% since January 2018,
when internal distributor fees for TOPO
Plus Orders were last modified.122 The
Exchange states that, at the same time,
the average daily message count of
PHLX has more than doubled in just
five years, from approximately 3.0
billion messages per day in 2018 to
approximately 8.2 billion messages in
2023.123 The Exchange states that PHLX
118 See Notice, 89 FR at 21652 (citing Cboe Data
Services (CDS), Market Data Product Price List
(updated July 1, 2023), available at https://
cdn.cboe.com/resources/membership/US_Market_
Data_Product_Price_List.pdf).
119 See Notice, 89 FR at 21652 (citing Options 7,
Section 10 (Proprietary Data Feed Fees) (PHLX
Depth Data)). The Exchange states that ARCA does
not charge separately for top of book and depth of
book. Although PHLX is not proposing to change
fees for depth of book information, PHLX depth of
book information is included here to ensure
comparability. Id.
120 See Notice, 89 FR at 21652.
121 See Notice, 89 FR at 21652 (citing Securities
Exchange Act Release No. 82495 (January 12, 2018),
83 FR 2839 (January 19, 2018) (SR–Phlx–2018–08)
and Securities Exchange Act Release No. 68576
(January 3, 2013), 78 FR 1886 (January 9, 2013) (SR–
Phlx–2012–145)).
122 See Notice, 89 FR at 21652 (citing Bureau of
Economic Analysis, U.S. Department of Commerce,
‘‘Personal Consumption Expenditures Price Index,’’
available at https://www.bea.gov/data/personalconsumption-expenditures-price-index).
123 See Notice, 89 FR at 21652 (citing PHLX Data
(Average Daily Message Count was
2,979,919,551.32 in 2018, and 8,243,516,029.17
thus far in 2023)). The Exchange states that the
significant increases in data traffic have also
required technological upgrades to manage the
larger traffic volume and to respond to overall
technological change in the industry. See Notice, 89
FR at 21652 (citing See, e.g., Securities Exchange
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grew in conjunction with options
trading overall, which in the aggregate
grew at a faster pace than PHLX alone—
specifically stating that between January
2018 and December 2023, options
volume on PHLX grew by 31%, while
options volume on all exchanges nearly
doubled, from 467 million options to
912 million instruments.124
The Exchange states that growth in
options trading means better value for
the consumer, that the greater variety of
options contracts traded means that
customers have more choice, and that
the greater number of buyers and sellers
in the market means that there is more
liquidity, resulting in tighter spreads
and better consumer value on each
trade.125 The Exchange further states
that greater choice and tighter spreads
mean that the consumer obtains more
value from options markets overall,
which should be reflected in fees for
exchange services, including market
data.126 The Exchange concludes that
the proposal is therefore reasonable in
light of the substantial increase in
customer value generate by the higher
levels of liquidity now available on the
Exchange, coupled with the fall in real
prices due to inflation.127
The Exchange states that External
Distributors receive additional value not
available to Internal Distributors by
disseminating information externally
and typically charging for the service
and that this additional value supports
higher fees for external distribution for
TOPO, PHLX Orders, and TOPO Plus
Orders.128 The Exchange states that
higher fees for external distribution of
data are common throughout the
industry, and nearly universal among
exchanges and that the difference in
value between internal and external
distribution is also reflected in the
current fee schedule.129
The Exchange states that, in summary,
the proposal represents an equitable
allocation of reasonable dues, fees and
other charges because: (i) customers
have a choice in trading venue, and will
exercise that choice and trade at another
venue if exchange fees are not set
competitively; (ii) the top of book data
sent in the TOPO feed are also sent to
Act Release No. 82495 (January 12, 2018), 83 FR
2839 (January 19, 2018) (SR–Phlx–2018–08)
(discussing a number of functional enhancements to
both TOPO and PHLX Orders)).
124 See Notice, 89 FR at 21652 (citing Options
Clearing Corporation, ‘‘Volume and Open Interest,’’
available at https://www.theocc.com/market-data/
market-data-reports/volume-and-open-interest/
volume-by-exchange).
125 See Notice, 89 FR at 21652.
126 See Notice, 89 FR at 21652.
127 See Notice, 89 FR at 21652–53.
128 See Notice, 89 FR at 21653.
129 See Notice, 89 FR at 21653.
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OPRA, and customers have the option of
relying on OPRA data; (iii) the purchase
of PHLX Orders is entirely optional as
it is a low-cost alternative to the PHLX
Depth of Market product; (iv) the
proposed fees are comparable to those of
other exchanges; (v) exchange fees have
fallen in real terms while the amount of
liquidity available on the exchange has
increased, and (vi) external vendors
receive additional value from
distributing data to their own customers
and typically charging for the service,
and therefore charging higher fees for
external distribution is fair and
reasonable.130
The Exchange also states that the
Proposal is not unfairly
discriminatory.131 The Exchange states
that the three market data feeds at issue
here—TOPO, PHLX Orders, and TOPO
Plus Orders—are used by a variety of
market participants for a variety of
purposes, and states that users include
regulators, market makers, competing
exchanges, media, retail, academics,
portfolio managers.132 The Exchange
states that market data feeds will be
available to members of all of these
groups on a non-discriminatory basis.133
The Exchange also does not believe that
the proposed rule change will impose
any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act.134 The
Exchange states that nothing in the
Proposal burdens inter-market
competition (the competition among
self-regulatory organizations) because
approval of the Proposal does not
impose any burden on the ability of
other options exchanges to compete.135
The Exchange states that PHLX fees are
comparable to, and in some cases less
than, those of other exchanges.136 The
Exchange finally states that nothing in
the Proposal burdens intra-market
competition (the competition among
consumers of exchange data) because
PHLX market data is available to any
customer under the same fee schedule
as any other customer, and any market
participant that wishes to purchase
PHLX market data can do so on a nondiscriminatory basis.137
provide a statement supporting the
proposal’s basis under the Act and the
rules and regulations thereunder
applicable to the exchange.138 The
instructions to Form 19b–4, on which
exchanges file their proposed rule
changes, specify that such statement
‘‘should be sufficiently detailed and
specific to support a finding that the
proposed rule change is consistent with
[those] requirements.’’ 139
Section 6 of the Act, including
Sections 6(b)(4), (5), and (8), require the
rules of an exchange to: (1) provide for
the equitable allocation of reasonable
fees among members, issuers, and other
persons using the exchange’s
facilities; 140 (2) perfect the mechanism
of a free and open market and a national
market system, protect investors and the
public interest, and not be designed to
permit unfair discrimination between
customers, issuers, brokers, or
dealers; 141 and (3) not impose any
burden on competition not necessary or
appropriate in furtherance of the
purposes of the Act.142
In temporarily suspending the
Exchange’s proposed rule change, the
Commission intends to further consider
whether the Proposal to increase market
data fees is consistent with the statutory
requirements applicable to a national
securities exchange under the Act. In
particular, the Commission will
consider whether the proposed rule
change satisfies the standards under the
Act and the rules thereunder requiring,
among other things, that an exchange’s
rules provide for the equitable
allocation of reasonable fees among
members, issuers, and other persons
using its facilities; not permit unfair
discrimination between customers,
issuers, brokers or dealers; and do not
impose any burden on competition not
necessary or appropriate in furtherance
of the purposes of the Act.143
Therefore, the Commission finds that
it is appropriate in the public interest,
for the protection of investors, and
otherwise in furtherance of the purposes
of the Act, to temporarily suspend the
proposed rule change.144
B. Suspension
When exchanges file their proposed
rule changes with the Commission,
including fee filings like the Exchange’s
present proposal, they are required to
138 See 17 CFR 240.19b–4 (Item 3 entitled ‘‘SelfRegulatory Organization’s Statement of the Purpose
of, and Statutory Basis for, the Proposed Rule
Change’’). To date, the Commission has received
one comment letter on proposed rule change, which
does not appear to be relevant to the instant filing.
See Ross Letter.
139 See id.
140 15 U.S.C. 78f(b)(4).
141 15 U.S.C. 78f(b)(5).
142 15 U.S.C. 78f(b)(8).
143 See 15 U.S.C. 78f(b)(4), (5), and (8),
respectively.
144 For purposes of temporarily suspending the
proposed rule change, the Commission has
considered the proposed rule’s impact on
130 See
Notice, 89 FR at 21653.
Notice, 89 FR at 21653.
132 See Notice, 89 FR at 21653.
133 See Notice, 89 FR at 21653.
134 See Notice, 89 FR at 21653.
135 See Notice, 89 FR at 21653.
136 See Notice, 89 FR at 21653.
137 See Notice, 89 FR at 21653.
131 See
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khammond on DSKJM1Z7X2PROD with NOTICES
IV. Proceedings To Determine Whether
To Approve or Disapprove the
Proposed Rule Changes
In addition to temporarily suspending
the Proposal, the Commission also
hereby institutes proceedings pursuant
to Sections 19(b)(3)(C) 145 and
19(b)(2)(B) of the Act 146 to determine
whether the Exchange’s proposed rule
change should be approved or
disapproved. Institution of proceedings
does not indicate that the Commission
has reached any conclusions with
respect to any of the issues involved.
Rather, the Commission seeks and
encourages interested persons to
provide additional comment on the
proposed rule change to inform the
Commission’s analysis of whether to
approve or disapprove the proposed
rule change.
Pursuant to Section 19(b)(2)(B) of the
Act,147 the Commission is providing
notice of the grounds for possible
disapproval under consideration:
• Whether the Exchange has
demonstrated how the proposed fees are
consistent with Section 6(b)(4) of the
Act, which requires that the rules of a
national securities exchange ‘‘provide
for the equitable allocation of reasonable
dues, fees, and other charges among its
members and issuers and other persons
using its facilities’’; 148
• Whether the Exchange has
demonstrated how the proposed fees are
consistent with Section 6(b)(5) of the
Act, which requires, among other
things, that the rules of a national
securities exchange not be ‘‘designed to
permit unfair discrimination between
customers, issuers, brokers, or
dealers’’; 149 and
• Whether the Exchange has
demonstrated how the proposed fees are
consistent with Section 6(b)(8) of the
Act, which requires that the rules of a
national securities exchange ‘‘not
impose any burden on competition not
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
145 15 U.S.C. 78s(b)(3)(C). Once the Commission
temporarily suspends a proposed rule change,
Section 19(b)(3)(C) of the Act requires that the
Commission institute proceedings under Section
19(b)(2)(B) to determine whether a proposed rule
change should be approved or disapproved.
146 15 U.S.C. 78s(b)(2)(B).
147 Id. Section 19(b)(2)(B) of the Act also provides
that proceedings to determine whether to
disapprove a proposed rule change must be
concluded within 180 days of the date of
publication of notice of the filing of the proposed
rule change. See id. The time for conclusion of the
proceedings may be extended for up to 60 days if
the Commission finds good cause for such
extension and publishes its reasons for so finding,
or if the exchange consents to the longer period. See
id.
148 15 U.S.C. 78f(b)(4).
149 15 U.S.C. 78f(b)(5).
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necessary or appropriate in furtherance
of the purposes of [the Act].’’ 150
As discussed in Section III above, the
Exchange made various arguments in
support of the Proposal. There are
questions as to whether the Exchange
has provided sufficient information to
demonstrate that the proposed fees are
consistent with the Act and the rules
thereunder. The Commission will
specifically consider, among other
things, whether the Exchange has
provided sufficient evidence to
demonstrate that the proposed market
data fees are reasonable and equitably
allocated, are not unfairly
discriminatory, and do not impose any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.
Under the Commission’s Rules of
Practice, the ‘‘burden to demonstrate
that a proposed rule change is
consistent with the [Act] and the rules
and regulations issued thereunder . . .
is on the [SRO] that proposed the rule
change.’’ 151 The description of a
proposed rule change, its purpose and
operation, its effect, and a legal analysis
of its consistency with applicable
requirements must all be sufficiently
detailed and specific to support an
affirmative Commission finding,152 and
any failure of an SRO to provide this
information may result in the
Commission not having a sufficient
basis to make an affirmative finding that
a proposed rule change is consistent
with the Act and the applicable rules
and regulations.153
The Commission is instituting
proceedings to allow for additional
consideration and comment on the
issues raised herein, including as to
whether the proposed fees are
consistent with the Act, and
specifically, with its requirements that
exchange fees be reasonable and
equitably allocated, not be unfairly
discriminatory, and not impose any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.154
V. Commission’s Solicitation of
Comments
The Commission requests written
views, data, and arguments with respect
to the concerns identified above as well
as any other relevant concerns. Such
comments should be submitted by June
12, 2024. Rebuttal comments should be
submitted by June 26, 2024. Although
150 15
U.S.C. 78f(b)(8).
CFR 201.700(b)(3).
152 See id.
153 See id.
154 See 15 U.S.C. 78f(b)(4), (5), and (8).
151 17
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45043
there do not appear to be any issues
relevant to approval or disapproval that
would be facilitated by an oral
presentation of views, data, and
arguments, the Commission will
consider, pursuant to Rule 19b–4, any
request for an opportunity to make an
oral presentation.155
The Commission asks that
commenters address the sufficiency and
merit of the Exchange’s statements in
support of the Proposal, in addition to
any other comments they may wish to
submit about the proposed rule changes.
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include file number SR–
Phlx–2024–15 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–Phlx–2024–15. 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
155 15 U.S.C. 78s(b)(2). Section 19(b)(2) of the Act
grants the Commission flexibility to determine what
type of proceeding—either oral or notice and
opportunity for written comments—is appropriate
for consideration of a particular proposal by an
SRO. See Securities Acts Amendments of 1975,
Report of the Senate Committee on Banking,
Housing and Urban Affairs to Accompany S. 249,
S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975).
E:\FR\FM\22MYN1.SGM
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Federal Register / Vol. 89, No. 100 / Wednesday, May 22, 2024 / Notices
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–Phlx–2024–15 and should be
submitted on or before June 12, 2024.
Rebuttal comments should be submitted
by June 26, 2024.
VI. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(3)(C) of the Act,156 that
File No. SR–Phlx–2024–15, be and
hereby is, temporarily suspended. In
addition, the Commission is instituting
proceedings to determine whether the
proposed rule change should be
approved or disapproved.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.157
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024–11168 Filed 5–21–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Sunshine Act Meetings
FEDERAL REGISTER CITATION OF PREVIOUS
ANNOUNCEMENT: To be published.
PREVIOUSLY ANNOUNCED TIME AND DATE OF
THE MEETING: Thursday, May 23, 2024, at
2:00 p.m.
The Closed
Meeting scheduled for Thursday, May
23, 2024, at 2:00 p.m., has been
cancelled.
CHANGES IN THE MEETING:
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration #20314 and #20315;
KANSAS Disaster Number KS–20005]
Administrative Declaration of a
Disaster for the State of Kansas
U.S. Small Business
Administration.
ACTION: Notice.
AGENCY:
This is a notice of an
Administrative declaration of a disaster
for the State of Kansas dated 05/16/
2024.
Incident: Westmoreland Tornado.
Incident Period: 04/30/2024.
DATES: Issued on 05/16/2024.
Physical Loan Application Deadline
Date: 07/15/2024.
Economic Injury (EIDL) Loan
Application Deadline Date: 02/18/2025.
ADDRESSES: Visit the MySBA Loan
Portal at https://lending.sba.gov to
apply for a disaster assistance loan.
FOR FURTHER INFORMATION CONTACT:
Vanessa Morgan, Office of Disaster
Recovery & Resilience, U.S. Small
Business Administration, 409 3rd Street
SW, Suite 6050, Washington, DC 20416,
(202) 205–6734.
SUPPLEMENTARY INFORMATION: Notice is
hereby given that as a result of the
Administrator’s disaster declaration,
applications for disaster loans may be
submitted online using the MySBA
Loan Portal https://lending.sba.gov or
other locally announced locations.
Please contact the SBA disaster
assistance customer service center by
email at disastercustomerservice@
sba.gov or by phone at 1–800–659–2955
for further assistance.
The following areas have been
determined to be adversely affected by
the disaster:
Primary Counties: Pottawatomie
Contiguous Counties:
Kansas: Jackson, Marshall, Nemaha,
Riley, Shawnee, Wabaunsee
The Interest Rates are:
SUMMARY:
CONTACT PERSON FOR MORE INFORMATION:
For further information, please contact
Vanessa A. Countryman from the Office
of the Secretary at (202) 551–5400.
khammond on DSKJM1Z7X2PROD with NOTICES
(Authority: 5 U.S.C. 552b.)
Dated: May 17, 2024.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–11298 Filed 5–20–24; 11:15 am]
BILLING CODE 8011–01–P
156 15
157 17
U.S.C. 78s(b)(3)(C).
CFR 200.30–3(a)(57).
VerDate Sep<11>2014
17:06 May 21, 2024
Jkt 262001
For Physical Damage:
Homeowners with Credit Available Elsewhere ......................
Homeowners without Credit
Available Elsewhere ..............
Businesses with Credit Available Elsewhere ......................
Businesses without Credit
Available Elsewhere ..............
Non-Profit Organizations with
Credit Available Elsewhere ...
Non-Profit Organizations without Credit Available Elsewhere .....................................
For Economic Injury:
PO 00000
Frm 00089
Fmt 4703
Sfmt 4703
Percent
Business and Small Agricultural
Cooperatives without Credit
Available Elsewhere ..............
Non-Profit Organizations without Credit Available Elsewhere .....................................
4.000
3.250
The number assigned to this disaster
for physical damage is 20314C and for
economic injury is 203150.
The State which received an EIDL
Declaration is Kansas.
(Catalog of Federal Domestic Assistance
Number 59008)
Isabella Guzman,
Administrator.
[FR Doc. 2024–11209 Filed 5–21–24; 8:45 am]
BILLING CODE 8026–09–P
SMALL BUSINESS ADMINISTRATION
[Disaster Declaration #20318 and #20319;
IOWA Disaster Number IA–20002]
Presidential Declaration of a Major
Disaster for the State of Iowa
U.S. Small Business
Administration.
ACTION: Notice.
AGENCY:
This is a Notice of the
Presidential declaration of a major
disaster for the State of Iowa (FEMA–
4779–DR), dated 05/14/2024.
Incident: Severe Storms and
Tornadoes.
Incident Period: 04/26/2024 through
04/27/2024.
DATES: Issued on 05/14/2024.
Physical Loan Application Deadline
Date: 07/15/2024.
Economic Injury (EIDL) Loan
Application Deadline Date: 02/14/2025.
ADDRESSES: Visit the MySBA Loan
Portal at https://lending.sba.gov to
apply for a disaster assistance loan.
FOR FURTHER INFORMATION CONTACT:
Alan Escobar, Office of Disaster
Recovery & Resilience, U.S. Small
Business Administration, 409 3rd Street
Percent
SW, Suite 6050, Washington, DC 20416,
(202) 205–6734.
SUPPLEMENTARY INFORMATION: Notice is
5.375 hereby given that as a result of the
President’s major disaster declaration on
2.688 05/14/2024, applications for disaster
loans may be submitted online using the
8.000 MySBA Loan Portal https://
lending.sba.gov or other locally
4.000 announced locations. Please contact the
SBA disaster assistance customer
3.250
service center by email at
disastercustomerservice@sba.gov or by
3.250 phone at 1–800–659–2955 for further
assistance.
SUMMARY:
E:\FR\FM\22MYN1.SGM
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]]>Agencies
[Federal Register Volume 89, Number 100 (Wednesday, May 22, 2024)]
[Notices]
[Pages 45036-45044]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-11168]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-100160; File No. SR-Phlx-2024-15]
Self-Regulatory Organizations; Nasdaq PHLX LLC; Suspension of and
Order Instituting Proceedings To Determine Whether To Approve or
Disapprove Proposed Rule Change To Amend the Exchange's Fees for Top of
PHLX Options (TOPO), PHLX Orders, and TOPO Plus Orders
May 16, 2024.
I. Introduction
On March 20, 2024, Nasdaq PHLX LLC (``Phlx'' or ``Exchange'') filed
with the Securities and Exchange Commission (``Commission'' or
``SEC''), pursuant to Section 19(b)(1) of the Securities Exchange Act
of 1934 (``Act''),\1\ and Rule 19b-4 thereunder,\2\ a proposed rule
change (File Number SR-Phlx-2024-15) to increase fees for certain
market data products (``Proposal''). The proposed rule change was
immediately effective upon filing with the Commission pursuant to
Section 19(b)(3)(A) of the Act.\3\ The proposed rule change was
published for comment in the Federal Register on March 28, 2024.\4\
Pursuant to Section 19(b)(3)(C) of the Act,\5\ the Commission is
hereby: (1) temporarily suspending the proposed rule change; and (2)
instituting proceedings to determine whether to approve or disapprove
the proposed rule change.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A). A proposed rule change may take
effect upon filing with the Commission if it is designated by the
exchange as ``establishing or changing a due, fee, or other charge
imposed by the self-regulatory organization on any person, whether
or not the person is a member of the self-regulatory organization.''
15 U.S.C. 78s(b)(3)(A)(ii).
\4\ See Securities Exchange Act Release No. 99841 (March 22,
2024), 89 FR 21648 (``Notice''). The Commission has received one
comment letter on the proposed rule change. See Letter from Brookes
Ross, received April 29, 2024 (``Ross Letter''). Comments received
on the Proposal are available at: https://www.sec.gov/comments/sr-phlx-2024-15/srphlx202415.htm.
\5\ 15 U.S.C. 78s(b)(3)(C).
---------------------------------------------------------------------------
II. Background and Description of the Proposed Rule Change
The Exchange states that the purpose of the proposed rule change is
to amend the Exchange's proprietary data fees for Top of PHLX Options
(``TOPO''),\6\ PHLX
[[Page 45037]]
Orders,\7\ and TOPO Plus Orders at Options 7, Section 10.\8\
---------------------------------------------------------------------------
\6\ See Notice, 89 FR at 21648 (citing Options 3, Section
23(a)(1) (``Top of PHLX Options (`TOPO') is a direct data feed
product that includes the Exchange's best bid and offer price, with
aggregate size, based on displayable order and quoting interest on
Phlx and last sale information for trades executed on Phlx. The data
contained in the TOPO data feed is identical to the data
simultaneously sent to the processor for the OPRA and subscribers of
the data feed. The data provided for each options series includes
the symbols (series and underlying security), put or call indicator,
expiration date, the strike price of the series, and whether the
option series is available for trading on Phlx and identifies if the
series is available for closing transactions only.'')).
\7\ See Notice, 89 FR at 21648 (citing Options 3, Section
23(a)(1) (``PHLX Orders is a real-time full Limit Order book data
feed that provides pricing information for orders on the PHLX Order
book for displayed order types as well as market participant
capacity. PHLX Orders is currently provided as part of the TOPO Plus
Orders data product. PHLX Orders provides real-time information to
enable users to keep track of the single and complex order book(s).
The data provided for each options series includes the symbols
(series and underlying security), put or call indicator, expiration
date, the strike price of the series, leg information on complex
strategies and whether the option series is available for trading on
Phlx and identifies if the series is available for closing
transactions only. The feed also provides auction and exposure
notifications and order imbalances on opening/reopening (size of
matched contracts and size of the imbalance)'')).
\8\ The proposed changes were initially filed on November 16,
2023, as SR-Phlx-2023-51. On December 5, 2023, SR-Phlx-2023-51 was
withdrawn and replaced with SR-Phlx-2023-57. On January 29, 2024,
SR-Phlx-2023-57 was withdrawn and replaced with SR-Phlx 2024-03. On
March 20, 2024, SR-Phlx-2024-03 was withdrawn and replaced with the
instant filing to provide additional detail regarding the proposal.
See Notice, 89 FR at 21648.
---------------------------------------------------------------------------
The Exchange states that TOPO is a direct data feed that provides
subscribers with PHLX Best Bid and Offer (``BBO'') \9\ and last sale
information.\10\ The Exchange also states that the data distributed on
TOPO is identical to the data simultaneously sent to the Options Price
Reporting Authority (``OPRA'').\11\ The Exchange states that TOPO feed
also provides administrative information to facilitate trading on the
Exchange such as, for example, the list of symbols trading on a
particular day.\12\ The Exchange states that TOPO reduces the
transmission and processing latencies for top of book information
relative to the OPRA feed by avoiding the latencies generated by the
latter in consolidating data.\13\ The Exchange states that monthly fees
for TOPO are currently $2,000 for Internal Distributors,\14\ $2,500 for
External Distributors,\15\ $1 for a Non-Professional Subscriber,\16\
and $40 for a Professional Subscriber.\17\ The Exchange further states
that none of these fees have changed for over a decade since January
2013.\18\
---------------------------------------------------------------------------
\9\ See Notice, 89 FR at 21648. The Exchange states that Best
Bid and Offer includes aggregate size information based on
displayable order and quoting interest on the Exchange. Id. at n.6.
\10\ See Notice, 89 FR at 21648 (citing PHLX, ``Top of Phlx
Options,'' available at https://www.nasdaqtrader.com/
Micro.aspx?id=TOPO#:~:text=Top%20of%20PHLX%20Options%20(TOPO,in%20the
%20consolidated%20market%20feed).
\11\ See Notice, 89 FR at 21648 (citing Options 3 (Options
Trading Rules), Section 23(a)(1) (Data Feeds and Trade Information)
(``The data contained in the TOPO data feed is identical to the data
simultaneously sent to the processor for the OPRA and subscribers of
the data feed.'')).
\12\ See Notice, 89 FR at 21648 (citing Nasdaq, ``Top of Phlx
Options Interface Specifications, Version 3.4'' Section 4.3
available at https://www.nasdaqtrader.com/content/technicalsupport/specifications/dataproducts/topofphlx.pdf (describing the start of
day options directory message, which lists all symbols eligible for
the auction process)).
\13\ See Notice, 89 FR at 21648.
\14\ See Notice, 89 FR at 21648 (citing Options 7, Section 10
(Proprietary Data Feed Fees) (Top of PHLX Options) (``A
`distributor' of Nasdaq PHLX data is any entity that receives a feed
or data file . . . directly from Nasdaq PHLX or indirectly through
another entity and then distributes it either internally (within
that entity) or externally (outside that entity). All distributors
execute a Nasdaq PHLX distributor agreement.'')).
\15\ See Notice, 89 FR at 21648 (citing Options 7, Section 10
(Proprietary Data Feed Fees) (Top of PHLX Options)).
\16\ See Notice, 89 FR at 21648 (citing Options 7, Section 10
(Proprietary Data Feed Fees) (Top of PHLX Options) (``A Non-
Professional Subscriber is a natural person who is neither: (i)
registered or qualified in any capacity with the Commission, the
Commodities Futures Trading Commission, any state securities agency,
any securities exchange or association, or any commodities or
futures contract market or association; (ii) engaged as an
`investment adviser' as that term is defined in Section 201(11) of
the Investment Advisors Act of 1940 (whether or not registered or
qualified under that Act); nor (iii) employed by a bank or other
organization exempt from registration under federal or state
securities laws to perform functions that would require registration
or qualification if such functions were performed for an
organization not so exempt. A Non-Professional Subscriber may only
use the data provided for personal purposes and not for any
commercial purpose.'')).
\17\ See Notice, 89 FR at 21648 (citing Options 7, Section 10
(Proprietary Data Feed Fees) (Top of PHLX Options) (``A Professional
Subscriber is any Subscriber that is not a Non-Professional
Subscriber. If the Nasdaq Subscriber agreement is signed in the name
of a business or commercial entity, such entity would be considered
a Professional Subscriber.'')).
\18\ See Notice, 89 FR at 21649 (citing Securities Exchange Act
Release No. 68576 (January 3, 2013), 78 FR 1886 (January 9, 2013)
(SR-Phlx-2012-145)).
---------------------------------------------------------------------------
The Exchange states that PHLX Orders is a real-time order book feed
with pricing information for displayed orders on the PHLX order
book.\19\ The Exchange states that the data provided for each options
series includes the symbols (series and underlying security), a put or
call indicator, expiration date, and the strike price of the
series.\20\ The Exchange states that it also provides the real-time
status of simple and complex orders \21\ on the order book, including
new orders and changes to orders resting on the PHLX book for all PHLX-
listed options.\22\ The Exchange states that PHLX Orders feed includes
data on the opening imbalance, Price Improvement XL (PIXL),\23\ and
Complex Order Live Auction (COLA).\24\ The Exchange further states that
a notification message is sent for symbols entering an auction.\25\ The
Exchange states that PHLX Orders also furnishes an historical record of
all simple and complex order message data from the PHLX Orders data
feed and that PHLX Orders information is not sent to OPRA.\26\
---------------------------------------------------------------------------
\19\ See Notice, 89 FR at 21649 (citing Options 3 (Options
Trading Rules), Section 23(a)(2) (Data Feeds and Trade
Information)).
\20\ See Notice, 89 FR at 21649.
\21\ See Notice, 89 FR at 21649 (citing Options 3 (Options
Trading Rules), Section 23(a)(2) (Data Feeds and Trade Information);
Section 14(a)(i) (``Complex Order. For purposes of the electronic
trading of Complex Orders, a Complex Order is an order involving the
simultaneous purchase and/or sale of two or more different options
series in the same underlying security, priced as a net debit or
credit based on the relative prices of the individual components,
for the same account, for the purpose of executing a particular
investment strategy.'')).
\22\ See Notice, 89 FR at 21649 (citing Nasdaq, ``PHLX Orders,''
available at https://www.nasdaqtrader.com/Micro.aspx?id=PHLXOrders).
\23\ See Notice, 89 FR at 21649 (citing Options 3 (Options
Trading Rules), Section 23(a)(2); Section 13 (Price Improvement XL)
(``A member may electronically submit for execution an order it
represents as agent on behalf of a Public Customer, broker-dealer,
or any other entity (`PIXL Order') against principal interest or
against any other order (except as provided in sub-paragraph (a)(6)
below) it represents as agent (an `Initiating Order') provided it
submits the PIXL Order for electronic execution into the PIXL
Auction (`Auction') pursuant to this Rule.'')).
\24\ See Notice, 89 FR at 21649 (citing Options 3, Section 14(e)
which describes the process for the Complex Order Live Auction
(``COLA'')).
\25\ Notice, 89 FR at 21649 (citing Nasdaq, ``PHLX Orders
Interface Specification,'' (Version 1.92) available at https://www.nasdaqtrader.com/content/technicalsupport/specifications/dataproducts/topoplusorders.pdf (describing auction notification
message)).
\26\ See Notice, 89 FR at 21649 (citing Limited Liability
Company Agreement of Options Price Reporting Authority, LLC Article
V, Section 5.2(c)(i) (January 1, 2010), available at https://assets.website-files.com/5ba40927ac854d8c97bc92d7/5d0bd57d87d3ccca102102d7_OPRA%20Plan%20with%20Updated%20Exhibit%20A%20-%2006-19-2019.pdf
(describing last sale and best bid and offer information
disseminated by OPRA)).
---------------------------------------------------------------------------
The Exchange states that PHLX Orders is an alternative to PHLX
Depth of Market and is an optimized technical channel designed to lower
technology costs, reduce processing time, and facilitate the ingestion
of data while still providing customers insight beyond the top of book
by viewing active buy and sell orders.\27\ The Exchange further states
that PHLX Orders excludes quotations by market makers and other
authorized entities that is included in PHLX Depth of Market.\28\
Regarding the
[[Page 45038]]
utility of an orders-only data feed, the Exchange states that it
provides customers with the opportunity to reduce bandwidth (and
therefore data processing costs) by several orders of magnitude
relative to the full depth of book feed, while retaining a view of
market participant orders (setting aside symbols where participants
have not placed orders).\29\
---------------------------------------------------------------------------
\27\ See Notice, 89 FR at 21649.
\28\ See Notice, 89 FR at 21649 (citing Options 3 (Options
Trading Rules), Section 23(a)(3) (Data Feeds and Trade Information)
(``PHLX Depth of Market is a data product that provides: (i) order
and quotation information for individual quotes and orders on the
order book . . .'') (emphasis added); Section 4(b) (Entry and
display of Quotes) (identifying the market participants authorized
to submit quotes to the Exchange)).
\29\ See Notice, 89 FR at 21649.
---------------------------------------------------------------------------
The Exchange states that the December 2023 bandwidth report shows
that the PHLX Depth of Market feed transmitted a maximum of 14.3
billion messages per day during the month of December, while the PHLX
Orders feed transmitted a maximum of 53.6 million messages over the
same period (41.5 million messages for simple orders, and 12.1 million
messages for complex orders).\30\ The Exchange states that it's full
depth of book feed requires the customer to process over 200 times more
messages than the orders feed over the course of a day; replacing a
depth of book feed with an orders feed allows a customer to reduce the
maximum number of daily messages it receives by 99.6%.\31\ The Exchange
states that, to cite another example, the 1 millisecond bandwidth peak
for PHLX Depth of Market was 13.96 million messages; the comparable
number of messages for orders was 1.45 million (891 thousand for simple
and 561 thousand for complex orders).\32\ The Exchange states that
replacing depth of book with orders can therefore reduce the number of
messages processed at peak at the 1 millisecond bandwidth by nearly
90%.\33\ The Exchange further states that approximately 56% of
customers who take any data feed at all from the PHLX exchange take an
orders feed (either Orders only or TOPO Plus Orders) without depth of
book, another 38% of customers take both orders and depth feeds, and
the remaining 6% take either top of book or depth of book alone.\34\
---------------------------------------------------------------------------
\30\ See Notice, 89 FR at 21649 (citing Nasdaq, ``December 2023
Bandwidth Report,'' available at https://view.officeapps.live.com/op/view.aspx?src=https%3A%2F%2Fwww.nasdaqtrader.com%2Fcontent%2Ftechnicalsupport%2Fspecifications%2Fdataproducts%2Fbandwidthreport.xls&wdOrigin=BROWSELINK).
\31\ See Notice, 89 FR at 21649.
\32\ See Notice, 89 FR at 21649.
\33\ See Notice, 89 FR at 21649.
\34\ See Notice, 89 FR at 21649.
---------------------------------------------------------------------------
The Exchange states that in general, firms that only need
information on actively trading options takes an order feed in lieu of
depth.\35\ The Exchange explains that there are a great number of use
cases that fit this broad description, but, for purposes of
illustration, the Exchange is aware of at least two such types of
customers.\36\ The Exchange states that the first is the market
participant that does not engage in order routing--and that these are
broker dealers that use third parties to route orders, either because
the originating broker-dealer is not a member of the exchange or to
save costs.\37\ The Exchanges states that without the need for
additional information to inform routing decisions, such customers
often focus on active trading alone, and therefore purchase the orders
feed.\38\ The Exchange states that a second category of customers are
those that use options data to analyze trends in other markets.\39\ The
Exchange explains that one example of this type of customer is the
equity trader that analyzes equity-based options to gauge market
sentiment in the underlying equity.\40\ The Exchange states that for
such customers, there is relatively little utility in the full depth
feed, given that market sentiment is best gauged using options that are
being actively traded, rather than those that are dormant.\41\
---------------------------------------------------------------------------
\35\ See Notice, 89 FR at 21649.
\36\ See Notice, 89 FR at 21649.
\37\ See Notice, 89 FR at 21649.
\38\ See Notice, 89 FR at 21649.
\39\ See Notice, 89 FR at 21649.
\40\ See Notice, 89 FR at 21649.
\41\ See Notice, 89 FR at 21649.
---------------------------------------------------------------------------
The Exchange states that there are some customers that purchase
both orders and depth and that vendors are one example of this type of
customer, purchasing market data solely for resale, not for trading on
behalf of themselves or others.\42\ The Exchange explains that another
example is the firm that uses orders for analysis and depth for order
routing.\43\ The Exchange states that the orders feed can be useful for
assessing sentiment in equity markets, while depth is often used in
order routing decisions.\44\ The Exchange states that firms that engage
in both functions can lower overall processing requirements by using
orders for analytics and depth for routing.\45\
---------------------------------------------------------------------------
\42\ See Notice, 89 FR at 21649.
\43\ See Notice, 89 FR at 21649.
\44\ See Notice, 89 FR at 21649.
\45\ See Notice, 89 FR at 21649.
---------------------------------------------------------------------------
The Exchange states that purchase of PHLX Orders is optional and
that customers can obtain all of the data contained in PHLX Orders from
PHLX Depth of Market feed, and may purchase the latter if they do not
realize the cost savings offered by PHLX Orders.\46\ The Exchange
states that PHLX Orders is a derivative product designed as a lower-
cost alternative to a depth of book feed.\47\ The Exchange further
states that it is not a complement to any other product offered by the
Exchange or any of its competitors.\48\ The Exchange explains that
customers are free to purchase PHLX Orders or not, and can reject the
feed for any reason, including the fee charged.\49\ The Exchange states
that the current monthly fees for PHLX Orders are $3,000 for Internal
Distributors, $3,500 for External Distributors, $1 for a Non-
Professional Subscriber, and $40 for a Professional Subscriber.\50\ The
Exchange further states that none of these fees have changes for over a
decade since January 2013.\51\
---------------------------------------------------------------------------
\46\ See Notice, 89 FR at 21650.
\47\ See Notice, 89 FR at 21650.
\48\ See Notice, 89 FR at 21650.
\49\ See Notice, 89 FR at 21650.
\50\ See Notice, 89 FR at 21650.
\51\ See Notice, 89 FR at 21650 (citing Securities Exchange Act
Release No. 68576 (January 3, 2013), 78 FR 1886 (January 9, 2013)
(SR-Phlx-2012-145)).
---------------------------------------------------------------------------
The Exchange states that TOPO Plus is a direct market data product
that offers subscribers both TOPO and PHLX Orders for a consolidated
fee that is less than the combined fee of the two products.\52\ The
Exchange states that the monthly fees for TOPO Plus Orders are
currently $4,500 for Internal Distributors, $5,000 for External
Distributors, $1 for a Non-Professional Subscriber, and $40 for a
Professional Subscriber.\53\ The Exchange states that Internal
Distributor fees for TOPO Plus Orders were modified in January 2018,
over five years ago,\54\ but the other TOPO Plus Orders fees have not
changed since January 2013.\55\
---------------------------------------------------------------------------
\52\ See Notice, 89 FR at 21650 (citing PHLX, TOPO Plus PHLX
Orders, available at https://www.nasdaqtrader.com/Micro.aspx?id=TOPOPlusOrders).
\53\ See Notice, 89 FR at 21650.
\54\ See Notice, 89 FR at 21650 (citing Securities Exchange Act
Release No. 82495 (January 12, 2018), 83 FR 2839 (January 19, 2018)
(SR-Phlx-2018-08)).
\55\ See Notice, 89 FR at 21650 (citing Securities Exchange Act
Release No. 68576 (January 3, 2013), 78 FR 1886 (January 9, 2013)
(SR-Phlx-2012-145)).
---------------------------------------------------------------------------
The Exchange states that different types of market participants
purchase TOPO, PHLX Orders and TOPO Plus Orders, including market
makers, vendors, banks, proprietary traders, agency brokers (brokers
that route trades on behalf of other market participants), hedge funds,
index providers and other firms.\56\ The Exchange states that in
characterizing market participants, it must be clear that firms use
data feeds for multiple tasks.\57\ The Exchange states that a market
maker, for example, may use market data for order routing,
[[Page 45039]]
or for risk analysis used in quoting in their assigned option
series.\58\ The Exchange states that banks may use market data for
prime brokerage services, proprietary trading, or risk management.\59\
The Exchange states that market data vendors do not directly use the
data at all, but rather disseminate data to market participants that
use the data for a multiplicity of purposes.\60\ The Exchange states
that other firms purchase options data to assess the value of equity
securities.\61\
---------------------------------------------------------------------------
\56\ See Notice, 89 FR at 21650.
\57\ See Notice, 89 FR at 21650.
\58\ See Notice, 89 FR at 21650.
\59\ See Notice, 89 FR at 21650.
\60\ See Notice, 89 FR at 21650.
\61\ See Notice, 89 FR at 21650. The Exchange states that it
does not include ``High Frequency Trading Firm'' as a distinct
category because many market participant may engage in low latency
trading strategies to some degree, but the Exchange does not have
sufficient information to be able to characterize any particular
firm as a high frequency trader. Id.
---------------------------------------------------------------------------
The Exchange explains that, characterizing firms based on what the
Exchange understands to be their primary market activity, and
understanding that firms play multiple roles, the Exchange estimates
that approximately half of the customers that take top of book data in
any form, in combination with other products or alone, are market
makers, and the remaining half are market data vendors, banks,
proprietary traders, agency brokers, hedge funds, index providers, and
others.\62\ The Exchange explains that roughly the same distribution
applies to customers that purchase PHLX Orders, whether alone or in
combination with other products.\63\ The Exchange states that although
the distributions are roughly similar, different customers are
purchasing different products in different combinations.\64\
---------------------------------------------------------------------------
\62\ See Notice, 89 FR at 21650.
\63\ See Notice, 89 FR at 21650.
\64\ See Notice, 89 FR at 21650.
---------------------------------------------------------------------------
The Exchange states that firms generally purchase PHLX Orders
rather than depth of book data to lower technology costs and reduce
processing time, while still providing customers insight into open
executable orders that could impact the BBO.\65\ The Exchange states
that a more specific explanation of how TOPO, PHLX Orders and TOPO Plus
Orders is used will vary based on use case, with many firms employing
multiple use cases.\66\ The Exchange states that market makers, banks,
hedge funds, and proprietary traders often use top of book and orders
feeds for trading, order routing and analysis.\67\ The Exchange states
that banks may use market data for prime brokerage services,
proprietary trading, or risk management.\68\ The Exchange states that
clients of market data vendors will utilize the data for many different
purposes.\69\ The Exchange explains that it does not have sufficient
visibility into customers' businesses and proprietary processes to be
able to determine precise data usage by customer category.\70\
---------------------------------------------------------------------------
\65\ See Notice, 89 FR at 21650.
\66\ See Notice, 89 FR at 21650.
\67\ See Notice, 89 FR at 21650.
\68\ See Notice, 89 FR at 21650.
\69\ See Notice, 89 FR at 21650.
\70\ See Notice, 89 FR at 21650.
---------------------------------------------------------------------------
The Exchange states that: for TOPO, it proposes to increase the
monthly charge for Internal Distributors from $2,000 to $2,500, and the
monthly charge for External Distributors from $2,500 to $3,000; For
PHLX Orders, it proposes to increase the monthly charge for Internal
Distributors from $3,000 to $3,500, and the monthly charge for External
Distributors from $3,500 to $4,000; and for TOPO Plus Orders, it
proposes to increase the monthly charge for Internal Distributors from
$4,500 to $5,500, and the monthly charge for External Distributors from
$5,000 to $6,000.\71\ The Exchange states that no changes are proposed
for Non-Professional and Professional Subscriber fees for TOPO, Phlx
Orders, or TOPO Plus.\72\ The Exchange further states that the proposed
changes are designed to update data fees to reflect their current
value, rather than their value when these fees were set 5 or 10 years
ago.\73\
---------------------------------------------------------------------------
\71\ See Notice, 89 FR at 21650.
\72\ See Notice, 89 FR at 21650.
\73\ See Notice, 89 FR at 21650.
---------------------------------------------------------------------------
III. Suspension of the Proposed Rule Change
Pursuant to Section 19(b)(3)(C) of the Act,\74\ at any time within
60 days of the date of filing of an immediately effective proposed rule
change pursuant to Section 19(b)(1) of the Act,\75\ the Commission
summarily may temporarily suspend the change in the rules of a self-
regulatory organization (``SRO'') 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. A temporary suspension of the proposed rule changes is
necessary and appropriate to allow for additional analysis of the
proposed rule change's consistency with the Act and the rules
thereunder.
---------------------------------------------------------------------------
\74\ 15 U.S.C. 78s(b)(3)(C).
\75\ 15 U.S.C. 78s(b)(1).
---------------------------------------------------------------------------
A. Exchange Statements in Support of the Proposal
In support of the Proposal, the Exchange states that it believes
that its proposal is consistent with Section 6(b) of the Act,\76\ in
general, and furthers the objectives of Sections 6(b)(4) and 6(b)(5) of
the Act,\77\ in particular, in that it provides for the equitable
allocation of reasonable dues, fees and other charges among members and
issuers and other persons using any facility, and is not designed to
permit unfair discrimination between customers, issuers, brokers, or
dealers.\78\ The Exchange explains that this belief is based on several
factors: First, the Exchange states that exchange fees are constrained
because market participants can choose among seventeen different venues
for options trading, and therefore no single venue can charge excessive
fees without losing customers and market share.\79\ Second, the
Exchange states that fees for TOPO are constrained because the
identical top of book data is sent to OPRA, and certain market
participants may choose to rely exclusively on OPRA rather than
purchasing the proprietary data product.\80\ Third, the Exchange states
that the purchase of PHLX Orders is optional, that it is designed as a
lower-cost alternative to depth of book--and, as such, is not a
complement to any other product offered by the Exchange or any of its
competitors, and that customers may purchase PHLX Orders or not, and
can reject the feed for any reason--including the fee charged.\81\
Fourth, the Exchange states that the proposed fees are comparable to,
and in some cases less than, those of similarly situated exchanges.\82\
Fifth, the Exchange states that the current fees do not properly
reflect the value of the underlying product, as fees for the products
in question have been static in nominal terms, and therefore falling in
real terms (due to inflation), while the amount of information
transmitted in those fees have more than doubled in just the past five
years, reflecting a substantial increase in customer value due to the
significantly higher levels of liquidity currently available on the
Exchange.\83\ Sixth, the Exchange states that higher fees for the
external distribution of TOPO, PHLX Orders, and TOPO Plus Orders are
based on the
[[Page 45040]]
additional value vendors receive from distributing data to their own
customers and typically charging for the service.\84\
---------------------------------------------------------------------------
\76\ 15 U.S.C. 78f(b).
\77\ 15 U.S.C. 78f(b)(4) and (5).
\78\ See Notice, 89 FR at 21650.
\79\ See Notice, 89 FR at 21650.
\80\ See Notice, 89 FR at 21650.
\81\ See Notice, 89 FR at 21650.
\82\ See Notice, 89 FR at 21650.
\83\ See Notice, 89 FR at 21650-51.
\84\ See Notice, 89 FR at 21651.
---------------------------------------------------------------------------
The Exchange states that customers face many choices in where to
trade options. The Exchange explains that until recently, sixteen
exchanges have offered options trading services, and they are now being
joined by a 17th member.\85\ The Exchange states that not a single
options exchange trades more than 11 percent of the options market by
volume.\86\ The Exchange states that PHLX, the second largest options
exchange by volume, only has 9 percent of the options market.\87\ The
Exchange states that only one of the 17 options exchanges have a market
share over 10 percent.\88\ The Exchange states that this broad
dispersion of market share demonstrates that market participants can
and do exercise choice in options trading venues.\89\ The Exchange also
states that as the number of exchanges continues to grow, competition
will become fiercer and customer choice will continue to expand.\90\
---------------------------------------------------------------------------
\85\ See Notice, 89 FR at 21651 (citing OPRA Plan, list of OPRA
Participant Exchanges, available at https://www.opraplan.com/faqs,
and Securities Exchange Act Release No. 98388 (September 14, 2023),
88 FR 64963 (September 20, 2023) (File No. 4-443) (``Joint Industry
Plan; Notice of Filing and Immediate Effectiveness of Amendment to
the Plan for the Purpose of Developing and Implementing Procedures
Designed To Facilitate the Listing and Trading of Standardized
Options To Add MEMX LLC as a Plan Sponsor'')). The Exchange states
that all options exchanges are members of the OPRA Plan. Id.
\86\ See Notice, 89 FR at 21651 (citing Nasdaq, Options Market
Statistics (Last updated November 3, 2023), available at https://www.nasdaqtrader.com/Trader.aspx?id=OptionsVolumeSummary). The
Exchange states that on November 3, 2023, the total percentage of
options market volume by exchange was as follows: ARCA: 11%; PHLX:
9%; CBOE: 9%; BOX: 8%; ISE: 7%; EDGX: 7%; AMEX: 7%; MIAX: 7%; MPRL:
7%; NOM: 6%; BATS: 6%; C2: 5%; EMLD: 4%; MRX: 3%; GEMX: 3%; BXOP:
3%; MEMX: 0%. Id.
\87\ See Notice, 89 FR at 21651.
\88\ See Notice, 89 FR at 21651.
\89\ See Notice, 89 FR at 21651.
\90\ See Notice, 89 FR at 21651.
---------------------------------------------------------------------------
The Exchange states that most option contracts on the TOPO, TOPO
Plus, and Orders data feeds are traded on multiple exchanges.\91\ The
Exchange states that a sample of trading on March 7, 2024, from The
Options Clearing Corporation shows that 5,836 symbols were traded on
PHLX's options exchange, of which only 53 symbols were listed on the
PHLX options exchange only, and another 33 symbols were listed on
multiple Nasdaq-affiliated options exchanges.\92\
---------------------------------------------------------------------------
\91\ See Notice, 89 FR at 21651.
\92\ See Notice, 89 FR at 21651.
---------------------------------------------------------------------------
The Exchange states that, in order to remain competitive with other
options exchanges, PHLX, like some options exchanges, offers several
proprietary options products that are only traded on Nasdaq-affiliated
exchanges.\93\ The Exchange states that these include products based on
the Nasdaq 100[supreg] Index, such as NDX (Nasdaq 100 Index on PHLX,
Nasdaq GEMX, LLC (``GEMX'') and Nasdaq ISE, LLC (``ISE'')), XND (Nasdaq
100 Micro Index on PHLX and ISE), and NQX (Nasdaq 100 Micro Index on
ISE), as well as volatility products such as VOLQ (Nasdaq-100[supreg]
Volatility Index), foreign currency options, and other products.\94\
---------------------------------------------------------------------------
\93\ See Notice, 89 FR at 21651.
\94\ See Notice, 89 FR at 21651. The Exchange states that the
NASDAQ-100 is an index which includes 100 of the world's largest
non-financial companies listed on the wider NASDAQ Stock market,
based on their market capitalization. See Notice, 89 FR at 21651.
---------------------------------------------------------------------------
The Exchange states that some Nasdaq option proprietary products
are subject to direct, substitution-based competition from other
options exchanges and that all Nasdaq option proprietary products are
subject to the competition among exchanges for membership and market
share.\95\ The Exchange states that examples of substitution-based
competition include the VOLQ, which can be substituted with the Cboe
Volatility Index[supreg] (``VIX'').\96\ The Exchange states that NDX
(listed in PHLX, GEMX and ISE), XND (listed on PHLX and ISE) and NQX
(listed on ISE) all offer different ways of gaining exposure to the
Nasdaq 100[supreg] Index, are therefore each serves as a direct
substitute for the others.\97\ The Exchange also states that the Nasdaq
100[supreg] Index products also have alternatives among other
exchanges.\98\
---------------------------------------------------------------------------
\95\ See Notice, 89 FR at 21651.
\96\ See Notice, 89 FR at 21651 (citing Securities Exchange Act
Release No. 95170 (June 29, 2022), 87 FR 40295 (July 6, 2022) (SR-
Phlx-2022-27) (explaining that the Nasdaq-100[supreg] Volatility
Index (``VOLQ'') is subject to ``significant substitution-based
competitive forces; market participants can substitute options on
VOLQ for products offered by other exchanges, for example, the
options on the Cboe Volatility Index[supreg] (``VIX'').'')).
\97\ See Notice, 89 FR at 21651 (citing Securities Exchange Act
Release No. 99141 (December 12, 2023), 88 FR 87466 (December 18,
2023) (SR-Phlx-2023-55) (``[M]arket participants are offered
different ways to gain exposure to the Nasdaq 100 Index, whether
through the Exchange's proprietary products like options overlying
NDX, NDPX, or XND, or separately through multi-listed options
overlying Invesco QQQ Trust (``QQQ''); Securities Exchange Act
Release No. 99171 (December 14, 2023), 88 FR 88206 (December 20,
2023) (SR-ISE-2023-36) (explaining that NDX, XND and NQX provide
``market participants with a variety of choices in selecting the
product they desire to utilize in order to gain exposure to the
Nasdaq 100 Index.'')).
\98\ See Notice, 89 FR at 21651 (citing Securities Exchange Act
Release No. 99141 n.7 (December 12, 2023), 88 FR 87466 (December 18,
2023) (SR-Phlx-2023-55) (explaining that the fees for NDX and NDXP
are in line with fees assessed by Cboe on its MXEA and MXEF options
products)).
---------------------------------------------------------------------------
The Exchange states that exchange proprietary products are also
subject to competition among exchanges for membership and market
share.\99\ The Exchange states that there are many factors that may
cause a market participant to decide to become a member of a particular
exchange; among these are product offerings.\100\ The Exchange states
that introducing new and innovative products to the marketplace
designed to meet customer demands may attract market participants to
become a member of a particular options venue by allowing market
participants greater trading opportunities and new avenues to manage
risks.\101\ The Exchange states that an exchange's proprietary product
offering may attract order flow to a particular exchange to trade a
particular options product and generally make that exchange a more
desirable venue to transaction options, thereby attracting membership
to that exchange.\102\
---------------------------------------------------------------------------
\99\ See Notice, 89 FR at 21651 (citing Securities Exchange Act
Release No. 95170 (June 29, 2022), 87 FR 40295 (July 6, 2022) (SR-
Phlx-2022-27) (discussing the role of proprietary data products in
the competition among exchanges)).
\100\ See Notice, 89 FR at 21651.
\101\ See Notice, 89 FR at 21651.
\102\ See Notice, 89 FR at 21651.
---------------------------------------------------------------------------
The Exchange states that, in light of the number of trading venues
available to customers, the Exchange must price its products, including
TOPO, PHLX Orders, and TOPO Plus Orders (as well as other products),
competitively, otherwise customers would move to other venues.\103\ The
Exchange states that, ``[i]f competitive forces are operative, the
self-interest of the exchanges themselves will work powerfully to
constrain unreasonable or unfair behavior'' and, accordingly, ``the
existence of significant competition provides a substantial basis for
finding that the terms of an exchange's fee proposal are equitable,
fair, reasonable, and not unreasonably or unfairly discriminatory.''
\104\
---------------------------------------------------------------------------
\103\ See Notice, 89 FR at 21651.
\104\ See Notice, 89 FR at 21651 (citing Securities Exchange Act
Release No. 59039 (December 2, 2008), 73 FR 74,770 (December 9,
2008) (SR-NYSEArca-2006-21)).
---------------------------------------------------------------------------
The Exchange states that the top of book data in TOPO is sent to
OPRA; under OPRA rules, proprietary options information is available to
customers that have equivalent access to OPRA information, and
therefore is supplementary to the OPRA feed.\105\
[[Page 45041]]
The Exchange states that, specifically, Section 5.2(c)(iii) of the OPRA
Plan provides that ``[a] Member [of the OPRA Plan] may disseminate its
Proprietary Information,'' provided that ``such dissemination is
limited to other Members and to persons who also have equivalent access
to consolidated Options Information disseminated by OPRA for the same
classes or series of options that are included in the Proprietary
Information. . . .'' \106\ The Exchange states that ``Consolidated
Options Information'' refers to ``consolidated Last Sale Reports
combined with either consolidated Quotation Information or the BBO
furnished by OPRA'' and that access is deemed to be ``equivalent'' ``if
both if both kinds of information are equally accessible on the same
terminal or work station. . . .'' \107\
---------------------------------------------------------------------------
\105\ See Notice, 89 FR at 21651 (citing Limited Liability
Company Agreement of Options Price Reporting Authority, LLC Sec.
5.2(c)(iii) (January 1, 2010), available at https://assets.website-files.com/5ba40927ac854d8c97bc92d7/5d0bd57d87d3ccca102102d7_OPRA%20Plan%20with%20Updated%20Exhibit%20A%20-%2006-19-2019.pdf (``OPRA Plan'')).
\106\ See Notice, 89 FR at 21651 (citing Section 5.2(c)(iii) of
the OPRA Plan).
\107\ See Notice, 89 FR at 21652 (citing Section 5.2(c)(iii) of
the OPRA Plan).
---------------------------------------------------------------------------
The Exchange states that any customer that purchases proprietary
options data from the Exchange, including TOPO and TOPO Plus Orders,
must also have equivalent access to the OPRA Plan.\108\ The Exchange
states that the best bid and offer and last sale information available
from TOPO and TOPO Plus Orders fees is identical to the information
simultaneously sent to OPRA by the Exchange and that OPRA provides NBBO
and last sale information on options transactions.\109\ The Exchange
states that TOPO and TOPO Plus Orders provide additional administrative
information unique to trading on the Exchange, and also reduce the
transmission and processing latencies generated through the process of
consolidating data into the OPRA feed.\110\ The Exchange states that
because top of book and last sale information is available on OPRA as
well as TOPO, and customers who purchase TOPO have equivalent access to
the OPRA feed, certain customers may choose to rely on the OPRA feed in
lieu of purchasing PHLX data, thereby limiting the ability of the
Exchange from charging excessive fees for its TOPO and TOPO Plus Orders
feeds.\111\
---------------------------------------------------------------------------
\108\ See Notice, 89 FR at 21652.
\109\ See Notice, 89 FR at 21652. The Exchange states that the
TOPO feed includes administrative information (but not data) that is
not provided on the OPRA feed, such as symbol directory messages.
See Notice, 89 FR at 21652 (citing Nasdaq, ``Top of Phlx Options
Interface Specifications, Version 3.4'' Section 4.3 available at
https://www.nasdaqtrader.com/content/technicalsupport/specifications/dataproducts/topofphlx.pdf (describing the start of
day options directory message, which lists all symbols eligible for
the auction process)).
\110\ See Notice, 89 FR at 21652. The Exchange states that bid
and offer and last sale information provided with the TOPO Plus
Orders product is identical to the data sent to OPRA, although the
``orders'' component of TOPO Plus Orders is not. Id.
\111\ See Notice, 89 FR at 21652.
---------------------------------------------------------------------------
The Exchange states that purchase of PHLX Orders is optional and
that customers can obtain all of the data contained in PHLX Orders from
PHLX Depth of Market feed, and may purchase the latter if they do not
realize the cost savings offered by PHLX Orders.\112\ The Exchange
states that PHLX Orders is not a complement to any other product
offered by the Exchange or any of its competitors; customers are free
to purchase PHLX Orders or not, and can reject the feed for any reason,
including the fee charged.\113\
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\112\ See Notice, 89 FR at 21652.
\113\ See Notice, 89 FR at 21652.
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The Exchange states that the proposed fees are comparable to, and
in some cases less than, those of other similarly situated exchange
fees.\114\ The Exchange states that options market statistics show that
PHLX has a market share of approximately 9%, and that ARCA, with an 11%
market share, and CBOE, with a 9% market share, are its closest
competitors.\115\ The Exchange states that to obtain top of book and
depth of book information for internal distribution (including both
simple and complex options) from ARCA, a customer would be required to
pay an Access Fee of $3,000 per month, a Non-Display fee of at least
$5,000 per month for simple options, and a Non-Display fee of $1,000
for Complex Options, for a total of $9,000 per month.\116\ The Exchange
states that to obtain the same information from PHLX under the new
proposal, a customer would pay the Internal Distributor fee of $2,500
for TOPO, and an Internal Distributor fee of $4,000 for PHLX Depth
Data, for a total of $6,500 per month.\117\ The Exchange states that to
obtain comparable information for Cboe Options, a customer would be
required to pay a combined fee of $9,000 per month.\118\ The Exchange
states that a PHLX customer would pay the Internal Distributor fee of
$2,500 for TOPO, and an Internal Distributor fee of $4,000 for PHLX
Depth Data, for a total of $6,500 per month.\119\ The Exchange states
that as such, the proposed fees are comparable to fees charged by
industry peers, and therefore presumptively reasonable.\120\
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\114\ See Notice, 89 FR at 21652.
\115\ See Notice, 89 FR at 21652 (citing Nasdaq, Options Market
Statistics (Last updated November 3, 2023), available at https://www.nasdaqtrader.com/Trader.aspx?id=OptionsVolumeSummary).
\116\ See Notice, 89 FR at 21652 (citing NYSE Arca Options
Proprietary Market Data Fees (as of July 3, 2023), available at
https://www.nyse.com/publicdocs/nyse/data/NYSE_Arca_Options_Proprietary_Data_Fee_Schedule.pdf).
\117\ See Notice, 89 FR at 21652 (citing Options 7, Section 10
(Proprietary Data Feed Fees) (PHLX Depth Data)). The Exchange states
that ARCA does not charge separately for top of book and depth of
book. Id. The Exchange states that although PHLX is not proposing to
change fees for depth of book information, PHLX depth of book
information is included here to maintain comparability. Id.
\118\ See Notice, 89 FR at 21652 (citing Cboe Data Services
(CDS), Market Data Product Price List (updated July 1, 2023),
available at https://cdn.cboe.com/resources/membership/US_Market_Data_Product_Price_List.pdf).
\119\ See Notice, 89 FR at 21652 (citing Options 7, Section 10
(Proprietary Data Feed Fees) (PHLX Depth Data)). The Exchange states
that ARCA does not charge separately for top of book and depth of
book. Although PHLX is not proposing to change fees for depth of
book information, PHLX depth of book information is included here to
ensure comparability. Id.
\120\ See Notice, 89 FR at 21652.
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The Exchange states that the Internal Distributor fee for TOPO Plus
Orders was increased in 2018, while none of the other fees have changed
for over a decade, since January 2013, and that this means that fees
for TOPO, PHLX Orders, and TOPO Plus Orders have fallen in real terms
due to inflation.\121\ The Exchange explains that, using data generated
by the Department of Commerce to estimate inflation in the market for
portfolio management and investment services, inflation has increased
prices by 63.9% since January 2013, when most of the fees at issue were
set, and 15.7% since January 2018, when internal distributor fees for
TOPO Plus Orders were last modified.\122\ The Exchange states that, at
the same time, the average daily message count of PHLX has more than
doubled in just five years, from approximately 3.0 billion messages per
day in 2018 to approximately 8.2 billion messages in 2023.\123\ The
Exchange states that PHLX
[[Page 45042]]
grew in conjunction with options trading overall, which in the
aggregate grew at a faster pace than PHLX alone--specifically stating
that between January 2018 and December 2023, options volume on PHLX
grew by 31%, while options volume on all exchanges nearly doubled, from
467 million options to 912 million instruments.\124\
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\121\ See Notice, 89 FR at 21652 (citing Securities Exchange Act
Release No. 82495 (January 12, 2018), 83 FR 2839 (January 19, 2018)
(SR-Phlx-2018-08) and Securities Exchange Act Release No. 68576
(January 3, 2013), 78 FR 1886 (January 9, 2013) (SR-Phlx-2012-145)).
\122\ See Notice, 89 FR at 21652 (citing Bureau of Economic
Analysis, U.S. Department of Commerce, ``Personal Consumption
Expenditures Price Index,'' available at https://www.bea.gov/data/personal-consumption-expenditures-price-index).
\123\ See Notice, 89 FR at 21652 (citing PHLX Data (Average
Daily Message Count was 2,979,919,551.32 in 2018, and
8,243,516,029.17 thus far in 2023)). The Exchange states that the
significant increases in data traffic have also required
technological upgrades to manage the larger traffic volume and to
respond to overall technological change in the industry. See Notice,
89 FR at 21652 (citing See, e.g., Securities Exchange Act Release
No. 82495 (January 12, 2018), 83 FR 2839 (January 19, 2018) (SR-
Phlx-2018-08) (discussing a number of functional enhancements to
both TOPO and PHLX Orders)).
\124\ See Notice, 89 FR at 21652 (citing Options Clearing
Corporation, ``Volume and Open Interest,'' available at https://www.theocc.com/market-data/market-data-reports/volume-and-open-interest/volume-by-exchange).
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The Exchange states that growth in options trading means better
value for the consumer, that the greater variety of options contracts
traded means that customers have more choice, and that the greater
number of buyers and sellers in the market means that there is more
liquidity, resulting in tighter spreads and better consumer value on
each trade.\125\ The Exchange further states that greater choice and
tighter spreads mean that the consumer obtains more value from options
markets overall, which should be reflected in fees for exchange
services, including market data.\126\ The Exchange concludes that the
proposal is therefore reasonable in light of the substantial increase
in customer value generate by the higher levels of liquidity now
available on the Exchange, coupled with the fall in real prices due to
inflation.\127\
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\125\ See Notice, 89 FR at 21652.
\126\ See Notice, 89 FR at 21652.
\127\ See Notice, 89 FR at 21652-53.
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The Exchange states that External Distributors receive additional
value not available to Internal Distributors by disseminating
information externally and typically charging for the service and that
this additional value supports higher fees for external distribution
for TOPO, PHLX Orders, and TOPO Plus Orders.\128\ The Exchange states
that higher fees for external distribution of data are common
throughout the industry, and nearly universal among exchanges and that
the difference in value between internal and external distribution is
also reflected in the current fee schedule.\129\
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\128\ See Notice, 89 FR at 21653.
\129\ See Notice, 89 FR at 21653.
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The Exchange states that, in summary, the proposal represents an
equitable allocation of reasonable dues, fees and other charges
because: (i) customers have a choice in trading venue, and will
exercise that choice and trade at another venue if exchange fees are
not set competitively; (ii) the top of book data sent in the TOPO feed
are also sent to OPRA, and customers have the option of relying on OPRA
data; (iii) the purchase of PHLX Orders is entirely optional as it is a
low-cost alternative to the PHLX Depth of Market product; (iv) the
proposed fees are comparable to those of other exchanges; (v) exchange
fees have fallen in real terms while the amount of liquidity available
on the exchange has increased, and (vi) external vendors receive
additional value from distributing data to their own customers and
typically charging for the service, and therefore charging higher fees
for external distribution is fair and reasonable.\130\
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\130\ See Notice, 89 FR at 21653.
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The Exchange also states that the Proposal is not unfairly
discriminatory.\131\ The Exchange states that the three market data
feeds at issue here--TOPO, PHLX Orders, and TOPO Plus Orders--are used
by a variety of market participants for a variety of purposes, and
states that users include regulators, market makers, competing
exchanges, media, retail, academics, portfolio managers.\132\ The
Exchange states that market data feeds will be available to members of
all of these groups on a non-discriminatory basis.\133\ The Exchange
also does not believe that the proposed rule change will impose any
burden on competition not necessary or appropriate in furtherance of
the purposes of the Act.\134\ The Exchange states that nothing in the
Proposal burdens inter-market competition (the competition among self-
regulatory organizations) because approval of the Proposal does not
impose any burden on the ability of other options exchanges to
compete.\135\ The Exchange states that PHLX fees are comparable to, and
in some cases less than, those of other exchanges.\136\ The Exchange
finally states that nothing in the Proposal burdens intra-market
competition (the competition among consumers of exchange data) because
PHLX market data is available to any customer under the same fee
schedule as any other customer, and any market participant that wishes
to purchase PHLX market data can do so on a non-discriminatory
basis.\137\
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\131\ See Notice, 89 FR at 21653.
\132\ See Notice, 89 FR at 21653.
\133\ See Notice, 89 FR at 21653.
\134\ See Notice, 89 FR at 21653.
\135\ See Notice, 89 FR at 21653.
\136\ See Notice, 89 FR at 21653.
\137\ See Notice, 89 FR at 21653.
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B. Suspension
When exchanges file their proposed rule changes with the
Commission, including fee filings like the Exchange's present proposal,
they are required to provide a statement supporting the proposal's
basis under the Act and the rules and regulations thereunder applicable
to the exchange.\138\ The instructions to Form 19b-4, on which
exchanges file their proposed rule changes, specify that such statement
``should be sufficiently detailed and specific to support a finding
that the proposed rule change is consistent with [those]
requirements.'' \139\
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\138\ See 17 CFR 240.19b-4 (Item 3 entitled ``Self-Regulatory
Organization's Statement of the Purpose of, and Statutory Basis for,
the Proposed Rule Change''). To date, the Commission has received
one comment letter on proposed rule change, which does not appear to
be relevant to the instant filing. See Ross Letter.
\139\ See id.
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Section 6 of the Act, including Sections 6(b)(4), (5), and (8),
require the rules of an exchange to: (1) provide for the equitable
allocation of reasonable fees among members, issuers, and other persons
using the exchange's facilities; \140\ (2) perfect the mechanism of a
free and open market and a national market system, protect investors
and the public interest, and not be designed to permit unfair
discrimination between customers, issuers, brokers, or dealers; \141\
and (3) not impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act.\142\
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\140\ 15 U.S.C. 78f(b)(4).
\141\ 15 U.S.C. 78f(b)(5).
\142\ 15 U.S.C. 78f(b)(8).
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In temporarily suspending the Exchange's proposed rule change, the
Commission intends to further consider whether the Proposal to increase
market data fees is consistent with the statutory requirements
applicable to a national securities exchange under the Act. In
particular, the Commission will consider whether the proposed rule
change satisfies the standards under the Act and the rules thereunder
requiring, among other things, that an exchange's rules provide for the
equitable allocation of reasonable fees among members, issuers, and
other persons using its facilities; not permit unfair discrimination
between customers, issuers, brokers or dealers; and do not impose any
burden on competition not necessary or appropriate in furtherance of
the purposes of the Act.\143\
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\143\ See 15 U.S.C. 78f(b)(4), (5), and (8), respectively.
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Therefore, the Commission finds that it is appropriate in the
public interest, for the protection of investors, and otherwise in
furtherance of the purposes of the Act, to temporarily suspend the
proposed rule change.\144\
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\144\ For purposes of temporarily suspending the proposed rule
change, the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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[[Page 45043]]
IV. Proceedings To Determine Whether To Approve or Disapprove the
Proposed Rule Changes
In addition to temporarily suspending the Proposal, the Commission
also hereby institutes proceedings pursuant to Sections 19(b)(3)(C)
\145\ and 19(b)(2)(B) of the Act \146\ to determine whether the
Exchange's proposed rule change should be approved or disapproved.
Institution of proceedings does not indicate that the Commission has
reached any conclusions with respect to any of the issues involved.
Rather, the Commission seeks and encourages interested persons to
provide additional comment on the proposed rule change to inform the
Commission's analysis of whether to approve or disapprove the proposed
rule change.
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\145\ 15 U.S.C. 78s(b)(3)(C). Once the Commission temporarily
suspends a proposed rule change, Section 19(b)(3)(C) of the Act
requires that the Commission institute proceedings under Section
19(b)(2)(B) to determine whether a proposed rule change should be
approved or disapproved.
\146\ 15 U.S.C. 78s(b)(2)(B).
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Pursuant to Section 19(b)(2)(B) of the Act,\147\ the Commission is
providing notice of the grounds for possible disapproval under
consideration:
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\147\ Id. Section 19(b)(2)(B) of the Act also provides that
proceedings to determine whether to disapprove a proposed rule
change must be concluded within 180 days of the date of publication
of notice of the filing of the proposed rule change. See id. The
time for conclusion of the proceedings may be extended for up to 60
days if the Commission finds good cause for such extension and
publishes its reasons for so finding, or if the exchange consents to
the longer period. See id.
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Whether the Exchange has demonstrated how the proposed
fees are consistent with Section 6(b)(4) of the Act, which requires
that the rules of a national securities exchange ``provide for the
equitable allocation of reasonable dues, fees, and other charges among
its members and issuers and other persons using its facilities''; \148\
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\148\ 15 U.S.C. 78f(b)(4).
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Whether the Exchange has demonstrated how the proposed
fees are consistent with Section 6(b)(5) of the Act, which requires,
among other things, that the rules of a national securities exchange
not be ``designed to permit unfair discrimination between customers,
issuers, brokers, or dealers''; \149\ and
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\149\ 15 U.S.C. 78f(b)(5).
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Whether the Exchange has demonstrated how the proposed
fees are consistent with Section 6(b)(8) of the Act, which requires
that the rules of a national securities exchange ``not impose any
burden on competition not necessary or appropriate in furtherance of
the purposes of [the Act].'' \150\
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\150\ 15 U.S.C. 78f(b)(8).
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As discussed in Section III above, the Exchange made various
arguments in support of the Proposal. There are questions as to whether
the Exchange has provided sufficient information to demonstrate that
the proposed fees are consistent with the Act and the rules thereunder.
The Commission will specifically consider, among other things, whether
the Exchange has provided sufficient evidence to demonstrate that the
proposed market data fees are reasonable and equitably allocated, are
not unfairly discriminatory, and do not impose any burden on
competition that is not necessary or appropriate in furtherance of the
purposes of the Act.
Under the Commission's Rules of Practice, the ``burden to
demonstrate that a proposed rule change is consistent with the [Act]
and the rules and regulations issued thereunder . . . is on the [SRO]
that proposed the rule change.'' \151\ The description of a proposed
rule change, its purpose and operation, its effect, and a legal
analysis of its consistency with applicable requirements must all be
sufficiently detailed and specific to support an affirmative Commission
finding,\152\ and any failure of an SRO to provide this information may
result in the Commission not having a sufficient basis to make an
affirmative finding that a proposed rule change is consistent with the
Act and the applicable rules and regulations.\153\
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\151\ 17 CFR 201.700(b)(3).
\152\ See id.
\153\ See id.
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The Commission is instituting proceedings to allow for additional
consideration and comment on the issues raised herein, including as to
whether the proposed fees are consistent with the Act, and
specifically, with its requirements that exchange fees be reasonable
and equitably allocated, not be unfairly discriminatory, and not impose
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.\154\
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\154\ See 15 U.S.C. 78f(b)(4), (5), and (8).
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V. Commission's Solicitation of Comments
The Commission requests written views, data, and arguments with
respect to the concerns identified above as well as any other relevant
concerns. Such comments should be submitted by June 12, 2024. Rebuttal
comments should be submitted by June 26, 2024. Although there do not
appear to be any issues relevant to approval or disapproval that would
be facilitated by an oral presentation of views, data, and arguments,
the Commission will consider, pursuant to Rule 19b-4, any request for
an opportunity to make an oral presentation.\155\
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\155\ 15 U.S.C. 78s(b)(2). Section 19(b)(2) of the Act grants
the Commission flexibility to determine what type of proceeding--
either oral or notice and opportunity for written comments--is
appropriate for consideration of a particular proposal by an SRO.
See Securities Acts Amendments of 1975, Report of the Senate
Committee on Banking, Housing and Urban Affairs to Accompany S. 249,
S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975).
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The Commission asks that commenters address the sufficiency and
merit of the Exchange's statements in support of the Proposal, in
addition to any other comments they may wish to submit about the
proposed rule changes.
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-Phlx-2024-15 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-Phlx-2024-15. 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
[[Page 45044]]
business days between the hours of 10 a.m. and 3 p.m. Copies of the
filing also will be available for inspection and copying at the
principal office of the Exchange. Do not include personal identifiable
information in submissions; you should submit only information that you
wish to make available publicly. We may redact in part or withhold
entirely from publication submitted material that is obscene or subject
to copyright protection. All submissions should refer to file number
SR-Phlx-2024-15 and should be submitted on or before June 12, 2024.
Rebuttal comments should be submitted by June 26, 2024.
VI. Conclusion
It is therefore ordered, pursuant to Section 19(b)(3)(C) of the
Act,\156\ that File No. SR-Phlx-2024-15, be and hereby is, temporarily
suspended. In addition, the Commission is instituting proceedings to
determine whether the proposed rule change should be approved or
disapproved.
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\156\ 15 U.S.C. 78s(b)(3)(C).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\157\
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\157\ 17 CFR 200.30-3(a)(57).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-11168 Filed 5-21-24; 8:45 am]
BILLING CODE 8011-01-P
